Corn futures fell 3-4 cents following a disappointing US holiday export sales number. Funds were huge sellers on the break of just under 7,000 contracts. CBOT corn is caught in a range trade with support under $3.70 and resistance above $3.80 March. Fresh fundamental input is needed to break the market out of the range.
US export sales through Jan 3rd totaled 18 Mil Bu, down 2 Mil from the prior week and well below the pace needed to hit USDA’s annual target. Grain sales tend to drag in late Dec/early Jan, but a heavier burden lies on next week’s data dump, which will include sales from and entire month of Jan 10-Feb 14. Large sales are expected given the US’s discount to all other origins in Jan & early February which will be supportive.
Argentina’s corn crop is seeded. Crop ratings there this week rest at 61% GD/EX. The Buenos Aires exchange mentioned solid yield potential despite falling moisture reserves in La Pampa and Southern Buenos Aires. Argentine fob basis is at left. Premiums are in decline as early harvest starts in 3-4 weeks
Crosscurrents abound. US/exporter stocks stay tight without favorable N Hemisphere. Chinese demand for US corn lingers in the background. The Central US is the wettest in mid-February for nearly 2 decades. The risk is to the upside.
