THE ALLENDALE ADVISORY REPORT

Prepared by Allendale, Inc.

Commodity Wrap-Up For November 17, 2000

Japanese Corn Buying

(November 17, 2000) We promised to show you what impact StarLink could have on limiting corn sales to Japan this new 2000/01 marketing year. Both in mid-September and mid-October, the U.S. corn sales were reported well over 400 K tonnes or 15.7 million bushels. However, as discussions between Japanese corn buying companies and the USDA did build into the middle of this year's corn harvest when price pressure was heavy, Japan's buying trend began to fade significantly. Of the 10.054 billion bushels of corn produced in 2000, about 6% of the total demand is estimated to come from our number one corn buying customer, Japan. Do remember total usage for exports of this year's production is estimated to be 22.6%. As you have witnessed through our research in the past, you know the heaviest total usage comes in the first quarter of the U.S. marketing year. Thus far this marketing year, corn sales to Japan are 2,522,000 tonnes versus year-ago levels of 3,746,000. This represents a drop of 33%! And once again this is at a time when the heaviest use is typically September/October/November of the new marketing year. Overall total exports are now running 11% behind last year and 13% behind the five-year average, very similar to the wheat export sales pace. We remain long March puts to buy futures against near a potential low, which according to our study on March futures, could come by mid-December before the end of this year. However the overall run could be limited according to the study. We are also short one March corn call based on the same study which suggest a sell off is possible headed into late November.
 

	9/14	9/21	9/28
Corn Sales	289	415	299
Corn Exports	271	255	419
	10/5	10/12	10/19
Corn Sales	274	352	488
Corn Exports	463	219	265
	10/26	11/2	11/9
Corn Sales	85	165	148
Corn Exports	139	429	156

November 17, 2000

Allendale, Inc.

4506 Prime Parkway, McHenry, Illinois

800-262-7538

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