The corn market entered the week with a five-session losing streak. The last higher day was on July 2. Just last week December corn futures lost about 62 cents per bushel.
This past Monday the latest World Ag Supply and Demand estimates from USDA were a little bit bearish. Ending stocks and this year’s production both had figures a little bit higher than market expectations.
And yet, here we are sharply higher the first three days of the week. Wednesday’s gains have been the greatest so far, up 18 cents for corn and 31 cents for November soybeans. It appears news around the world has been supporting domestic prices.
“We can look straight at South America; that is where the majority of our support came from,” said Karl Setzer at AgriVisor. “Brazil possibly bought up to eight cargoes of Argentine corn. There’s more to the story than that, Brazil had some commitments from Argentina on the books, they’re taking delivery of them. But the simple fact that they’re taking them all at once shows that Brazil may be a little bit concerned over their corn supply already.”
This news comes around the same time that Rabobank projected Brazilian corn exports to be down 12 million metric tons. Crop production projections continue to fall as the year goes on, starting with a late planting season and multiple weather issues in recent months. Brazil’s corn harvest has also been running behind schedule.
Other commodity support has come from Canadian crop concerns. Ag Resources reports that spring wheat production is experiencing its worst year since 1988. Terrible heat and insufficient rainfall has also led to concerns for other crops such as corn and canola.
This could all change tomorrow, but this week’s push to the plus side has put December corn futures better than $5.50 at a time when a lot of the state’s corn is tasseling. For those who haven’t yet made any marketing decisions with this year’s crop, today’s prices provide a very good starting point.