Analysis: Corn

Canadian Planting Intentions

Apr 21, 3:46 pm | Corn, Soybeans, Wheat

Canadian farmers intend to plant 1.63 Mil more Hectares than last year’s final area, with most of the expansion in oilseeds. Combined canola and soybean seeding intention were pegged by Stats Canada this AM at a record 11.9 Mil HAs, up 1.4 Mil (14%) from last year, and with limited expansion in crush capacity additional supplies will find their way to the world market. ARC does note that cool/wet weather into early May will limit seeding progress, and so weather in May is much more important, but today’s report leans a bit bearish. Canadian wheat seedings at 9.4 Mil HAs are unchanged from last year, and so are slightly higher than expected. Winter wheat seedings in E Canada are down,…

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Corn Ends Day Unchanged, Ends Week Down $.14

Apr 21, 3:40 pm | Corn

Corn futures ended within fractions of unchanged across the board, and funds are now testing short positions seen at recent seasonal lows. Farmer selling has all but halted, and with a bulk of the speculative trade now short, ARC fully expects new selling to be limited until trend/above yields can be confirmed in late summer.   Managed funds on Tuesday were short a net 172,00 contracts, up 14,000 on the previous week and we estimated their net short today at closer to 185,000. Such a short has only been exceeded in 4 weeks previously since 2006 – when managed fund record keeping began – and with the US forecast rather wet in early May, and with S American production having…

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Corn Follows Wheat Lower; Argentine Harvest Advances Normally

Apr 20, 3:24 pm | Corn

July corn fell 4 cents, and the market as a whole is testing the lows of recent weeks. New contracts lows in KC wheat is cited, and major climate threats through spring are so far not anticipated, but just how much selling is left is uncertain as managed funds currently hold a net short position of 175,000 contracts, which has only been exceed a few times since 2006.   Fundamental input today is mixed. The extended US forecast includes soaking rainfall across the SW Midwest – and potential flooding there – and ARC maintains that planting progress by late April is very unlikely to exceed 30% complete. US weekly export sales through April 13th were an unexciting 30 Mil Bu,…

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Corn Settles Exactly Unchanged; Market Stuck in Short Term

Apr 19, 4:34 pm | Corn

  July corn settled completely unchanged, while new crop contract rallied fractionally, and overall breaking news is absent. Even minor fundamental updates are mixed.   It doesn’t pay to be short (along with much of the speculative trade) ahead of planting and earl summer weather. Rallies, however, will struggle as Argentina’s harvest advances, HRW yield potential rises, and as there are no signs yet of adverse heat and dryness across Central Brazil through early May. Expect choppy trading to continue, perhaps through late May, though we do calculate managed funds’ net short position at 163,000 contracts, vs. a net short of just 31,000 on this week a year ago. Interior basis is also improving slightly on a lack of selling….

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Corn Continues to Falter on Drier Central Midwest Forecast

Apr 18, 4:33 pm | Corn

  Short positioning/long liquidation continues as the EU & GFS weather models offer a trend drier across the Midwest in the last week of April. ARC’s climate work suggests that, overall, a wet spring is likely to continue but there do look to be periods of warmth & dryness in the next two weeks. Planting will resume across the E Midwest by next week. There’s also talk of Mexico and Argentina re-working trade deals to include Ag products by late year.   However, enlarged demand is expected through the next 45-60 days. Despite rising South American production estimates – which are validated by improving Brazilian rainfall through late April – US Gulf corn is still the world’s low cost origin…

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Corn Futures Extract Weather Premium; End Down 4-5 Cents

Apr 17, 4:30 pm | Corn

Fund selling resumed following the worldwide Easter holiday, which was mostly a function of weather. Funds remain very short in Chicago (ARC pegs managed funds’ net short today 150,000 contracts), but the market lacks the spark needed to trigger any lasting short covering effort.   The Central US forecast through the next week or so is drier in key parts of the Corn Belt, which along with adequate soil temps (60+ across MO, IL and much of the Eastern Corn Belt) will allow for regional planting activity in the second half of April. But we also mention improved forecasts for South America. Favorable dryness is expected across Argentina through the next 10 days, and in Brazil normal/above normal precip is…

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Corn Rallies, but Struggles at Tech Resistance

Apr 12, 4:48 pm | Corn

Funds bought/covered another 12,000 contracts in Chicago, following Tuesday’s rally. May corn struggled to exceed its 20-day moving average, and recent action suggests a sideways price trend is most probable heading into early summer. Fundamentally, there’s still a battle between a lack of US planting expected through late April and improving South American weather.   This week’s EIA report is viewed as supportive, as ethanol stocks decline, ethanol export demand improved, and production margins continue to surge. US ethanol production through the week ending April 7th fell sharply (290 Mil Gal, vs. 300 Mil during the previous week). Ethanol inventories fell 34 Mil Gal. Residual disappearance (exports likely) totaled 57 Mil Gal, vs. just 11 Mil in the prior week….

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Corn Rallies 7-8 Cents; Funds Pare Massive Short Position

Apr 10, 4:07 pm | Corn

  AgResource estimates that managed funds this morning were short a net 160,000 contracts (vs. 150,000 as of last Tuesday, reported by the CFTC), and a modest short covering rally unfolded today. Advances in planting will be only regional in nature over the next week, and the GFS operational includes hints of another round of soaking precip April 20-24. This, by itself, is not overly bullish but in the context of a large established short position, additional risk premium could be added until a prolonged pattern of dryness is advertised.   US corn planting through Sunday reached 3% complete, right at average and compared to 4% complete on this day a year ago. Seeding in TX is ahead of schedule;…

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