Early Call On Chicago

22/02/12 -- The overnight grains closed lower with beans falling around 4-6 cents and wheat and corn 2-3 cents weaker. Crude is down a tad and the dollar is slightly firmer.

The USDA have announced the sale of 175,000 MT of new crop soybeans to China.

The USDA's Annual Outlook Conference will take place on Thursday and Friday, with the final day giving us some early thoughts on US plantings for this year's harvest. The trade is expecting 94 million acres for corn, 74 million for soybeans and 56.5 million for wheat.

A return to anything close to trendline yields would give us a record corn crop in 2012.

Evidence is building that corn demand from the all important ethanol sector is starting to get choked off with corn at these levels and the blenders' tax credit now history.

Concerns over dryness in the northern Plains hampering spring plantings should be partially alleviated by forecast precipitation this week and into the first half of next week.

Tunisia is tendering for 50,000 MT of optional origin soft wheat, Bangladesh is in for 60,000 MT and Taiwan has bought 58,000 MT of Brazilian soybeans.

European weather has warmed up, fostering belief that any potential winter kill damage will not have been any worse than in a normal year.

Early calls for this afternoon's CBOT session: beans down 4-6 cents, corn and wheat 1-3 cents lower.