Parts of the market got a little reprieve from recent beatings yesterday and part of it didn’t. Dec corn got hit with a double whammy of new recent lows and big time support being violated, along with dropping below the “3” handle. That’s the first time since 2020 that a Dec futures contract traded below $4 in the expiring year.
To date, front end corn and MGEX wheat were the only two in the grains that hadn’t hit a new low water mark and in the past two days it finally happened unfortunately. It’s hard to fight funds jumping back on the sell side after only a brief reprieve after covering some of the record short positions in beans and corn, but they’ve been back at it again.
Weekly EIA ethanol data continued the recent trend of bullish production numbers. A new weekly record was set with 1.109 mln barrels per day of production and if this was the average for a full marketing year, we’d use 5.8 bln bushels of corn in the ethanol grind. That’s WAY over USDA’s 5.45 bln bushel number being used in the S&D’s. Of course, we also know the odds of the grind continuing this large are kinda slim. Regardless, production up 1% this week, blender demand only up .1% and stocks up 1.1%. Big time bullish production number, but stocks and blender demand are not bullish.
Weekly export sales in the grains for the old crop totals gave us friendly soybean and milo numbers and bearish wheat and corn. New crop numbers were friendly corn and beans and nonexistent in milo and wheat. Corn sales were 6.6 mln bushels of old crop and 28 mln new, along with 6.4 mln old crop milo sales and zero new. Soybeans gave us 13.8 mln old crop sales and 23.2 mln new. Wheat was 10.5 mln in old crop and zero new. Top buyers on the old crop side were Indonesia in wheat, Mexico in corn, China in milo and Germany in soybeans.
Funds yesterday were estimated sellers of 7500 corn and on the buy side of 1k wheat and 1k beans.
8am daily export reporting yesterday gave us a little over 104k mt’s of new crop corn sales to unknown destination. Today, USDA reported 132k mt’s of new crop US soybean sales to China.
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