The corn market saw two sided trading on Tuesday as traders prepare for the USDA report on Thursday. The corn market closed slightly higher after trading lower most of the session. The corn market opened slightly higher before trading as much as 5 cents higher before a quick reversal later in the morning pushed corn over 13 cents off the highs. Once again we saw pretty aggressive selling on an attempt to rally corn, or maybe it was a lack of buying when the selling started. Eventually, the corn market did find some buying or maybe it was the lack of selling, but it inched its way higher to close higher. The new crop December held up better than the old crop closing 3 higher as it didn’t trade as low as the old crop. There isn’t a lot of new news out right now, just position squaring ahead of the USDA report with most traders/hedgers trying to take neutral or reduced risk positions into the report. There were some big option trades yesterday tying to establish defined risk positions. The volume was only 276,000 with a lot of that as spread trade and funds were small buyers.
Overnight, the corn market closed slightly higher on a relatively quiet night session of only 3 ½ cents. The consensus estimate for corn acres tomorrow is 91.84 mil and the quarterly grain stocks is 6.69 bil bushels. In talking to traders/analysts, the market is leaning toward a surprise for higher acres and higher stocks which would be bearish for both old and new crop. The incentive to plant corn over beans is still very big especially with the $6.01 price guarantee, so the market expects farmers to plant more corn acres. Now this is just planting intentions and that can change if the weather doesn’t want to cooperate this spring, especially in the northern parts of the Midwest. The higher stocks number is anticipated because of the greater efficiency in live stock feeding and probably in ethanol production. We are hearing from numerous feeders that they are getting good weight gain on less corn because of the superior quality from last fall. Regardless, we just need to get this report behind us. We also get export sales tomorrow morning which could affect corn prices because of the uncertainty in unknown sales from Monday. The next thing to talk about is weather as it is still cold and wet across a lot of the Midwest, but as we know, that can change tomorrow and a forecast for 2 weeks of warmer/drier weather will open everything up.
Globex Overnight Contract Last Net Change High Low Volume ZCK11 673^0 1^2 675^0 671^4 5867 ZCN11 679^4 0^6 681^6 678^4 3293 ZCU11 634^2 1^6 635^0 632^0 231 ZCZ11 603^4 3^2 605^0 598^4 1487
LaSalle Street News Early Opening Calls: 1-2 cents better
LaSalle Street News Top News -- Dalian Jan. Corn futures were up +1 @ 2,397 yuan/mt. -- Liffe Jun. Corn futures were up +.50 @ 223.50 euros/mt. -- Globex Corn Vol: 240,066; Pit Vol: 26,424; Open Interest change: - 17,258 -- Weather: 6-10 Day Forecast: Normal to Below Temps. Normal to Below Precip West, Above East. -- Outside markets: Energy Complex -0.25 at $104.54; Gold & Silver: +12.1 at $1429.6 & +0.733 at $37.720; US $ -0.022 at $76.480
LaSalle Street News Cash Markets -- CIF Corn off 1, up 2. Mar. +49 to +54, Apr. +54 to +56, May +57 to +62, J/J +58 to +63, Aug. +90 to +1.00, Sept. +53 to +58, O/N +55 to +56
TREND: Corn managed to eek out small gains. This contract has been the short leg in many inter-commodity spreads because of concerns about bigger stocks and bigger acres expected in the crop report.
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