Bird Flu Background Worry in Ag markets

CHICAGO - Mar 9/06 - SNS -- International agricultural commodity markets remain relatively quiet, judging from the level of overnight activity reported.

In business, there are reports the Philippines bought 20,000 metric tons (MT) of corn and 25,000 MT of soybean meal from Argentina, while South Korea bought 52,500 MT of South American meal.

Ongoing news reports about the spread of avian influenza and crossover from birds to other animal species continue to create background anxiety in markets. On the plus side of the ledger, there have been no major new discoveries to grab international headlines and refocus market attention on the issue.

Even so, analyst at the Chicago Board of Trade remind us, "The spread of bird flu across Asia, Europe, the Middle East and Africa could dent corn demand for the coming year if the poultry producers in these areas do not recover and if grains and/or grazing beef displace the poultry in consumer diets.

"French officials raised their corn ending stocks estimate yesterday to 2.79 million MT from 2.47 million last month due to slower poultry production. They believe that use of all grains for animal feed could drop up to 6% this year. Poultry meat sales in France have dropped up to 30% this year. News that China corn stocks were revised higher by 9.4 million MT added to the demand concerns."

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