Analysis: Corn

South American Corn Supply & Demand

Mar 22, 4:31 pm | Corn

It’s time to update South American corn balance sheets. USDA/CONAB production estimates look a bit understated given weather to date.

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Corn Falls for Third Day Despite Solid Ethanol Production

Mar 22, 4:21 pm | Corn

Corn’s slide continues amid rising South American production estimates – and thus rising competition for export demand – and ongoing massive feedgrain alternatives. Ethanol production was better than expected, and rather large, but even this suggests additional DDGs will flood the market. A weather scare is needed to spark better interest from speculators.   Weekly US ethanol production through last Friday totaled 307 Mil Bu, barely changed from the previous week and up 14 Mil from the same week in 2016. Year-to-date weekly ethanol production rests at 8.7 Bil Bu, up a hefty 4.9% from a year ago, and while the USDA’s ethanol demand draw is still some 25-50 Mil Bu too low, this may be offset by lower feed…

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Corn Dragged Further by Wheat; South American Crops Likely Understated

Mar 21, 4:32 pm | Corn

We’ve highlighted in recent days the complete lack of any evidence that a hot/dry pattern lies in the offing in Brazil into the early part of April. The lack of dryness in turn promotes a rather mild temp profile, and it’s possible the South American crop estimates are still 1-3 MMTs too low. As such, the Gulf market needs to find demand, which it’s working towards, but a weak cash market does little to promote speculative interest in futures. Gulf basis for June rests at the lowest level since 2010.   Otherwise, Wednesday’s ethanol production figure is expected at 298-302 Mil Gal, vs. 307 Mil a week ago but just 293 Mil on the same week in 2016. Enlarged end…

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Corn Corrects on Wheat, Boost in US Soil Moisture

Mar 20, 4:34 pm | Corn

Friday’s CFTC report failed to spark any new buying or short covering, and rather Central US weather seemed to be the focused. In the context of a faster than expected pace of Argentine corn harvesting, and ongoing rainfall in Center-West Brazil, there’s just little bullish news available.   Should KC wheat futures drop further, cash HRW will again compete with corn for domestic feed use. Note also that Gulf SRW will be offered for spot delivery this evening at $180/MT, which is still well above Gulf corn offers but does serve as a reminder that the two markets are competing for some of the same demand. HRW conditions are expected to improve substantially in the weeks ahead, and amid trend…

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Price Response Following NASS’s March Reports

Mar 20, 1:37 pm | Corn, Soybeans

  There’s no real tendency for corn and soybean futures to rally or fall after the release of the March Grain Stocks & Prospective Plantings reports. At the start of the biofuel era, when stocks were tight and markets were still adjusting to new found corn demand and strong Chinese soybean import demand, the reports tended to produce rather volatile price responses in both cash and futures prices. Price responses have been less dramatic in the last 3 years, though volatility has remained above the pre biofuel era.   In the last decade, it’s often been the old crop quarterly stocks figure that has moved markets, and new crop prices have followed the old crop trends. In 2016, with the…

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Corn Rallies Modestly Again; Funds Now Short:

Mar 17, 3:56 pm | Corn

The corn market continues to rebound from lows posted last week, and funds have been much bigger net sellers than expected. As of Tuesday, the CFTC pegged managed funds’ net position at a short 24,000 contracts (compared to an estimated modest net long position), and funds are short for the first time since mid-January. With funds short, a neutral price pattern is likely to hold into planting.   But AgResource’s medium term outlook is little changed, and rallies will struggle on a lack of global weather threats. Corn harvest will be pretty steady in Argentina in the next two weeks, and should reach 30% complete by early April. In the US, dry weather across the far South, along with warming…

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March 1st US Corn Stocks

Mar 17, 10:02 am | Corn

AgResource breaks down Dec-Feb US corn supply and demand, and compares it to the USDA’s annual forecast.

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Corn Ends 3 Cents Higher; Export Sales Better than Expected

Mar 16, 3:46 pm | Corn

The market continues to find demand on the break from post-harvest highs. Recall ethanol demand through the week ending March 10th was much higher than anticipated, and now weekly export sales exceeded the higher end of trade guesses by 10 Mil Bu. May corn last week found buying at major technical support, and key on Friday is whether the contract can trade through its 100-day moving average at $3.67.   The graphic attached displays US export commitments as a percent of the annual total, or in the case of 2016/17 as a percent of the USDA’s forecast. Cumulative export commitments as of March 9th rest at 1,788 Mil Bu, 80% of the USDA’s forecast, and sales through early March have…

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Corn Rallies Further on Weekly Ethanol Data

Mar 15, 3:26 pm | Corn

CBOT corn futures remain stable amid tech-based support and as ethanol production data this week exceeded expectations rather substantially. Production margins have been increasing while corn futures have been falling, and plants responded quickly to up-tick in revenue. Funds were net buyers of 2,500 contracts.   Through week ending March 10th, US ethanol production totaled 307 Mil Gallons, up 7 Mil on the previous week and up 14 Mil from the same week in 2016. Using EIA weekly data, ARC pegs Feb corn used for ethanol at 425 Mil Gal, a record for the month, and estimates March demand at 467 Mil, by a record for the month. Total Sep-Mar ethanol demand is then calculated at 3,185 Mil, up 4.5%…

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