It has been a slow late winter in the grains market. Corn has been slow to move due to slow flat price and no interest in selling at these values by the producer. The cash market has stayed relatively firm despite a carry-out of 1.837 billion bushels. South America weather did not offer hope for the U.S. producer as the growing season, although there were some concerns at times, was fairly benign. Now the market will focus its attention on U.S. weather going into the spring planting season.
The February WASDE report offered little new information. U.S. corn carryout increased to 1.837 billion bushels, up 35 billion bushels from the December report. In comparison the last two years carryout was 1.731 and 1.232 billion bushels respectively. Demand was altered in this report. Export demand decreased by 50 million bushels in the February report. Ethanol demand increased by 25 million bushels to 5.225 billion bushels. One thing that did not catch trader’s eyes as quickly was the 10 million bushels increase in corn imports. Corn imports are projected to be 50 million bushels this year compared to 40 million bushels in previous estimates and 32 million bushels last year. The short crop in the ECB and firm cash market has led to more corn imports into the eastern and southeastern coast. Ultimately carryout was able to increase. World corn carryout was constant this month at 208 MMt. Brazil production increased from 81.5 to 84 MMt and Argentina corn production increased from 25.6 MMt to 27.0 MMt.
Corn prices wait for spring weather with little bounces expected due to slow movement and short position covering by managed money.
* Comments in this column are market commentary and are not to be construed as market advice.
|(May Futures, $)|
|February 22, 2016||3.7225||132.95|
|January 22, 2016||3.7475||133.84|
|February 23, 2015||3.8675||138.13|