Corn futures ended slightly higher, as actual yield data is just weeks away. Following the flood of bearish news since early Aug, combine reports much confirm NASS’s expectation to renew bearish sentiment. Crude is again approaching $50/barrel, and a push to produce elevated levels of gasoline lies in the offing following two devastating hurricanes. Note that US gasoline inventories through the week ending Sep 8th were down a hefty 8.4 Mil Barrels to 218.3 Mil, a new 1.5-year low. As such, ethanol production and blending margins remain rather stout.
However, US export demand continues to suffer, particularly to non-traditional destinations such as Mexico. New crop weekly sales through last Thursday totaled 41.2 Mil, a sizeable total, but cumulative 17/18 commitments rest at 414 Mil, down 38% from last year and the lowest since 2012.
Reduced yield prospects continue to battle against the loss of export demand, and ARC maintains a neutral outlook. Seasonal lows have likely been scored and, fundamentally, the next bear leg will hinge upon favorable S American crop establishment, which is far from certain. Argentine planting progress is delayed amid ongoing rainfall. Patience is advised.