Corn Weekly Comments

Corn Weekly Comments

Corn started the week by opening the overnight session lower and then extended session losses throughout the session. Early selling spilled over from a lower wheat complex. Losses were kept in check early from reports of two export sales. Japan was in and bought 110 TMT of US corn while an unknown destination was in and bought 182.4 TMT of US corn. Still no confirmation on any China business. As of March 3, Brazil is reporting harvest progress for their first corn crop at 35% complete vs 41% average. Planting of the second corn crop was estimated at 57% complete vs 65% average. Brazil now has 90 separate firms approved to ship corn to China. SA weather forecasts continue to be supportive, but corn needs something else to help give traders a reason to buy, as Argentina’s news is getting stale.

In Tuesday’s session corn opened the overnight session higher and held its gains throughout most of the overnight session. Just like wheat, corn’s overnight trading range was tight and lackluster with most months only seeing a 2-cent range. Early support was tied to reports of more rain in the forecast for Parana and MGDS, which will delay harvest and delay planting of the second corn crop. TX is reporting corn planting progress at 20% completed as of March 5, vs 5% the previous week and 13% average. Light selling spilled over from a sharply lower crude oil market. It appears that Chairman Powell’s speech in front of Congress was not well received by the financial district as it resulted in a sharp drop in the Dow, crude oil, and gold, and a sharp rally in the dollar. Light selling was also due to expectations that the Black Sea Initiative will be extended.

On Wednesday corn opened the overnight session higher and managed to hold one gains throughout the session. Early activity was tied to last minute position squaring ahead of today’s reports. Corn did see a bit of set back before the report due to comments from Mexico’s president stating that Mexico will not import GMO corn for human consumption after 2024, and that there is no compromise.

USDA’s March Crop Production report was negative corn. The only adjustment USDA made was to decrease exports by 75 MB, which in turn increased corn stocks by the same, putting stocks at 1.342 BB, 37 MB above expectations. On the world stage, corn’s end stocks estimate came in at 296.5 MMT, up 3.3 MMT from expectations and up 1.2 MMT from the previous month. USDA left Brazil’s production unchanged at 126 MMT but dramatically reduced Argentina’s production 7 MMT to 40.0 MMT, 3.3 MMT below estimates.

Last week’s ethanol production came in at 1.01 million barrels, a 7,000-barrel increase from the previous week. Stocks were estimated at 25.32 million barrels, up 545,000 barrels from the previous week, Gas stocks increased slightly.

In Thursday’s session corn opened the overnight session steady but managed to push higher throughout the night session. Early support spilled over from a higher wheat complex as well as from technical buying as traders try to correct an oversold condition. May corn has lost ground 8 of 10 sessions since Feb 22 losing 48.75 cents. Light support came from this morning’s strong export sales estimate, which broke above 1 MMT. CONAB’s corn estimate for Brazil is now at 124.7 MMT vs 123.7 MMT previously. Rosario’s Argentina corn production estimate is at 35 MMT vs 42.5 MMT previous.

May corn support is at $6.35 while resistance is at $6.85. Dec corn support is at $5.45 while resistance is at $5.95.

For the week, May corn was at $6.1725 down 22.5 cents. Dec corn was at $5.5925 down 13.25 cents.