Corn Sees Front Month Strength on Export Business

Corn is posting 3 to 6 ½ cent gains in the front months so far on Wednesday, Deferred new crop contracts fractionally mixed, with December down ½ cent.

USDA announced another export sale of 667,000 MT of corn to China for 22/23 delivery this morning. If you couple the sales this week, it would be the largest sale at least on a weekly basis to China since May 2021. Analysts are expecting Thursday’s weekly Export Sales report to show 0.7-1.5 MMT of 22/23 corn bookings in the week that ended on 3/9. New crop sales are seen at 0-200,000 MT. 

The weekly EIA report indicated a 4,000 barrel per day increase in ethanol production for the week that ended on 3/17 to 1.014 million bpd. Stocks were also on the rise, up 1.074 million barrels to 26.394 million barres. Over half (553,000 barrels) of the build was in the Gulf, with another 328,000 barrels increase for the East Coast, implying a stock up for exports. 

Another delayed Commitment of Traders report was released on Tuesday as CFTC is still in catch up mode. The report showed spec funds liquidating a record 147,293 contracts from their corn net long position in the week ending Feb 28. That took the position to a net long of just 68,635 contracts, the smallest since September 2020. Nearby futures dropped 51 cents per bushel during that liquidation. Commercial ownership was also the smallest since 9/2020, with the net short at 267,972 contracts on that Tuesday. End users did increase long hedges as prices declined, but commercial shorts shrank as farmer selling dried up. 

May 23 Corn  is at $6.27 1/4, up 6 1/2 cents,

Nearby Cash   is at $6.29 3/4, up 6 1/2 cents,

Jul 23 Corn  is at $6.13 1/4, up 3 1/2 cents,

Sep 23 Corn  is at $5.68, up 1/2 cent,