Corn is currently up 6 and soybeans are up 18 to start the day.
Corn futures went from 16 higher ot 8 lower yesterday showed the uncertainty of corn demand at these price levels. Exports are slow and US ethanol demand is not a real strong driving force for prices at these levels. Soybeans saw a similar selloff as they were trading 38 higher and closed 21 lower on the day. We broke thru resistance levels and set new highs in both commodities but failed to maintain.
Argentina’s Buenos Aires Grains Exchange yesterday cut their 2021/22 corn production estimate from 57 to 51 MMT; the Rosario Exchange last month reduced their own number from 56 to 48 MMT and is warning of further potential cuts due to low early yields and ongoing dryness. The Rosario Exchange warned of a possible soybean disaster on par with 2018 due to continue La Nina conditions, with their estimate down sharply last month to 40.5 MMT, compared to a 38 MMT harvest in 2018. The B.A. Exchange has ’21/22 soybeans pegged at 42.0 MMT, down two million tonnes last week.
The Biden Administration announced it would not be using the enforcement measures of the Phase1 deal and was instead building “a coalition to show a united front against China”. A relatively unspecific response after the Administration showed ire in the fact the deal was not being honored in its eyes. The expected cancellation of corn by China showed up in the Export Sales report today, along with 145 tmt of unknown, it cut the total net sales for the week to 589 tmt, which was very near to the bottom of expectation and nearly 1/3 the volume of a year ago on the same week.
Have a Safe Day!