Corn Weekly Comments May 10

Corn Weekly Comments May 10

To start the week corn opened the overnight session lower and extended session losses throughout the night. Early selling spilled over from a sharply lower wheat complex as well as from improving weather forecasts, which have pulled out some of the rain for the Corn Belt and increased temps. But once the day session started corn reversed direction, following the soybean complex higher. Support was due to production concerns in SA as flooding continues to impact the potential production of corn in RGDS while hot and dry conditions impact the central region. Argentina also saw temps get cold enough to cause frost damage to immature corn. As of May 3, Brazil first crop corn harvest was estimated at 82% complete vs 79% last week and 87% average.

On Tuesday corn opened the overnight session lower and continued to trade with small losses throughout the night. Early selling pressure was tied to Monday afternoon’s Crop Progress report which showed slow planting progress, but nothing that traders feel can’t be caught up with once weather turns drier. Light selling was also tied to weather forecasts calling for a drier spell once the last of the rain systems move through tomorrow. Technical selling was also evident as corn traded above its 100-day moving average yesterday, which brought out profit taking today. Corn was able to trim session losses later in the day session with support spilling over from a stronger soybean complex.

Corn opened Wednesday’s session steady but slipped to trade slightly in the red throughout most of the night due to spill over pressure from the lower wheat and soybeans. Technical selling was also evident as weak longs started to take profits on trade once corn failed to hold gains Tuesday. Forecasts calling for a window of opportunity for producers to return to the field and plant this weekend added pressure. Dr Cordonnier lowered his Argentina corn production estimate to 47 MMT but left Brazil’s corn production estimate unchanged at 112 MMT.

Last week’s ethanol production estimate slipped lower coming in at 965,000 barrels, a decline of 22,000 barrels from the previous week. Stocks were estimated at 24.2 million barrels, a sharp decline of 1.29 million barrels from the previous week putting stocks at their lowest level in 14 weeks. Gas demand did see a slight improvement as well.

In Thursday’s session corn opened the overnight session steady but managed to follow wheat higher during the night session. But corn lost its gains once the day session started with corn switching to follow the soybeans complex. Early support came from technical buying as corn bounced off support. Light support as due to news that Mexico was in and bought 132,080 MT of US corn overnight with 60,960 MT being old crop while 71,120 MT was new crop. Light support was also due to Rosario Grain trimming Argentina corn production 2.5 MMT to 47.5 MMT. Corn faded its gains and turned to trade lower once the day session started with selling tied to forecasts calling for a window of planting opportunity for much of the Corn Belt and Northern Plains.

Producers should continue to target $5.15 Dec to advance sales of both old and new crop.

Support for July corn is at $4.35 while resistance is at $4. 93..

For the week, July corn was at $4.695 up 9.5 cents. Dec corn was at $4.92 up 9.25 cents.