CBOT corn futures fell 5-6 cents, and are again testing recent lows – which have so far held rather well. Brazilian corn exporters are relatively better positioned to capture demand this summer amid a weaker real, but ARC notes political chaos doesn’t change physical supply and demand. NOAA’s updated climate forecast is completely lacking of drought emergence, though the issue in the near term is too much rain and the lack of heat. We maintain that choppy trading will persist and we advise against chasing today’s break.
Argentina’s corn harvest this week has reached 33% complete, up just 1.3% on the week and slightly below average. Argentine producers will now focus more on gathering beans, and heavy isolated showers are forecast in Buenos Aires & La Pampa through the weekend. ARC expects corn harvest there to advance just 3-5% in the next several weeks, which will likely keep Argentina’s cash market well supported.
Managed funds are net short an estimated 212,000 contracts, vs. 209,000 last week, a new record. No new sales are advised with the market leaning so bearish, and a test of $3.95-4.15,Dec, can be expected amid any perceived weather threat this summer.
