Corn Weekly Comments July 5

Corn Weekly Comments July 5

Corn traded back and forth in a choppy session on Monday and ended the session right around unchanged. Bargain buying after Friday’s steep losses supported corn. Non-threatening weather forecasts limited corn’s gains. Last week’s export shipments were in the range of trade expectations but a 21-week low. Friday’s stocks report showed 60% of total stocks on-farm, which is a record percentage. Mexico’s new ag minister said the government will drop the previous administration’s goal of reduce yellow corn imports for animal feed, largely imported from the US. Brazil’s safrinha corn harvest is estimated at 30% complete, sharply higher than the 5-year average of 14%. Corn’s crop condition rating dropped 2% to 67% g/e. That was 1% lower than expected.

In Tuesday’s session corn opened the overnight session higher and extended session gains throughout the night. Early support came from technical buying as corn has closed lower for the past 8 sessions in a row and is in need of a technical correction. Light support was also due to a bit of a troubling forecast for the major growing region in the US as cool wet conditions are expected to linger in the western and central Corn Belt while hot and moist conditions are expected in the eastern Corn Belt. Monday’s Crop Progress report did not bring much to the table as conditions dropped 2%, 1% more than anticipated. Losses were kept in check from reports Columbia bought 100 TMT of US corn. Dr Cordonnier is now estimating US corn production at 14.77 BB with planted acreage at 91.5 million, harvested acreage at 82.54 million (lowered by 952,000 acres due to heavy rains) with yield at 179 bus. He left Brazil and Argentina production estimates steady.

On Wednesday corn traded back and forth in a choppy session and closed just a couple of cents below unchanged. Hot and dry conditions are returning to the Black Sea region and at this point that will mainly affect the corn crop. Agroconsult completed a tour of Brazil’s safrinha corn crop and increased their production estimate by 3.8 MMT to 100.5 MMT vs. 111.5 MMT last year. The increase was based on a 1.0 million acre increase in acres. Agroconsult also estimated Brazil’s entire corn production at 126.5 MMT vs. USDA’s 122.0 MMT. There are reports that Argentina will ship corn to China for the first time in 15 years. Last week’s ethanol production saw an increase of 21,000 barrels per day to 1.064 million barrels per day. That was slightly higher than expected. But stocks also were increased more than expected.

For the week, Sept corn was at $4.105 up 3.0 cents. Dec corn was at $4.24 up 3.25 cents.