Corn Fades to Red after USDA Data

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Corn finished the last trade day of the week with fractional to 2 ½ cent losses across the front months. That left the March contract at just a ¾ cent gain for the week’s trade. USDA did not adjust the cash average price, still at $4.85. 

USDA’s weekly Ethanol report showed the cash average price was UNCH to 13 cents/gal weaker from $1.54 to $1.80/gal regionally. The regional DDGS markets saw trade from $170-$190 in MI to $240 in KS, mostly $5 to $20 weaker for the week. The cash corn oil market was mostly 1 to 4 cents/lb cheaper, from 53 to 56 cents/lb regionally. 

Weekly CFTC data showed corn spec traders were closing shorts and adding longs during the week that ended 12/5. That left the group with a 160,533 contract net short. The commercial hedgers were closing longs through the week, flipping them back to net short by 39,754 contracts. 

USDA announced a 165k MT corn sale to unknown destinations this morning. The main news, however, was USDA’s monthly WASDE report.  It showed a 25 mbu increase for the U.S. corn export program. That came out of carryout, dropping it to 2.131 bbu. The trade was looking for a 3 mbu trim on the average going in. Prices spiked on the first couple ticks after that news, but proceeded to “buy the rumor and sell the fact”. 

Global corn adjustments saw a 1.3 MMT increase to corn production (Ukraine +1 MMT, Egypt +200k, Canada -200k MT) to 1.222 billion MT. Both Brazil and Argentina were left UNCH. Brazil’s CONAB reduced projected corn production there by 530,000 MT to 118.53 MMT. That is both for summer crop (mostly planted now) and winter crop (which won’t be planted for the most part until soybeans come off in January and February). USDA doesn’t typically adjust their numbers this early in the growing season, and today was no exception. 

Dec 23 Corn  closed at $4.65 3/4, down 2 1/2 cents,

Nearby Cash   was $4.55 1/1, down 2 3/8 cents,

Mar 24 Corn  closed at $4.85 1/2, down 2 1/2 cents,

May 24 Corn  closed at $4.97 1/2, down 2 cents,

On the date of publication, Alan Brugler did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.