A surprise from China

Market Line February 23, 2008 Friday’s drop in stocks pressured grains and wheat closed lower but came off its lows with a late rally. Weekly export sales were better than expected. And there were reports of a surprise purchase by China of 30-thousand metric tons of U.S. soft red wheat with China saying it needed some quality grain. After the close Egypt tendered for wheat. Brian Hoops of Midwest Market Solutions thinks Kansas City wheat will lead wheat higher. Hoops: “As we have smaller acreage than last year and I think crop conditions are going to start declining as there is the dry forecast and some of that winter wheat is breaking dormancy.� On Friday Chicago May wheat was down a half cent at 5-30 ½. May corn down three at 3-59. Portland soft white wheat any protein and maximum 10.5 percent protein five to ten cents higher at mostly 5-69. August new crop bids dropped as much as 15 cents to 5-32 to 5-40. Club wheat 7-19. HRW 11.5 % protein two to three cents higher at 6-05. DNS 14% protein down seven cents at 7-70. No Portland barley bids. Cattle futures went back to triple digit losses Friday on the lower stock market and pre-Cattle on Feed report nervousness. April live cattle down 132 at 83-42. April feeders down 205 at 89-82. The USDA report pegged the February one feedlot inventory down 5.6 percent from a year ago, January placements up four percent and marketings last month down six percent. Analysts says beef’s problem isn’t supply, it’s demand. Also of note, JBS has called off its purchase of National Beef. In dairy, April Class III milk down four cents at 10-48. I’m Bob Hoff and that’s Market Line on the Northwest Ag Information Network. Now this.