Early Call On Chicago

29/03/12 -- The overnight grains saw beans 2-3 cents higher, with corn 3-5 cents lower and wheat down a cent or so.

Crude oil is a bit weaker on talk that France, the US and the UK are in discussions with the International Energy Agency about a potential release of strategic oil reserves.

In addition US stocks rose by 7.1 million barrels to 353.4 mln last week, the biggest weekly increase since July 2010 and inventories are now at their highest level in seven months.

The USDA reported weekly export sales for wheat of a combined 403,100 MT, below expectations of 450-750 TMT. Shipments of of 440,900 MT were down 20 percent from the previous week.

For corn we got old crop sales of 130,700 MT - a marketing-year low - and new crop sales of only 27,000 MT. That's way below the anticipated 600-900 TMT.

Soybean sales of 471,900 MT for old crop and 120,400 MT for new crop were within the range of trade estimates of 450-750 TMT. China took 209,900 MT of the old crop and 55,000 MT of the new crop. In addition, the USDA have reported 120,000 MT of soybeans sold to China overnight under the daily reporting system.

Despite the funds having already liquidated an estimated 35-40,000 corn contracts heading into tomorrow's USDA reports these numbers may encourage some further load lightening this afternoon. In addition, despite plenty of rumours to the contrary, there was no sign of China as a featured corn buyer.

That may drag wheat a bit lower with it as US weather remains non-threatening with no frost in the 7-10 day forecast. We also have very favourable conditions for fieldwork in the Midwest and beneficial rains in the Southern Plains having improved HRW wheat conditions substantially in recent weeks.

Concerns remain over Western European dryness though, some moisture is in the forecast for Eastern Europe in the week ahead.

The USDA have just reported the sale of 120,000 MT of US corn to unknown. Interesting. There are all sorts of things you could read into that.

Early calls for this afternoon's CBOT session: corn down 3-5 cents, wheat down 1-3 cents, beans up 2-4 cents.