December corn was trading 1 1/4 cents lower near 7:00 am cst and Dalian corn saw marginal loses, and is down 0.34%. Equity markets were the catalyst for the lower commodity trade once again after worse than expected corporate earnings for Apple yesterday afternoon. Asian equity markets followed lower and US stock futures saw significant losses overnight. The US dollar is trading modestly higher against the Euro as investors await the release of the US Q3 GDP which will likely set the tone for the markets today. Grains are weaker across the board as energies and metals sink.
Another round of poor corporate earnings and bad demand data for the corn market triggered profit taking and sent December corn to a fresh 7 day low this morning. Additional pressure was added as large holders of long positions roll to deferred contracts as First Notice Day draws closer. Technical sell signals added to the downside momentum yesterday. Yesterday's volume was recorded at 213,657 contracts and open interest increased by 997 contracts on the lower trade. Funds were estimated to have sold close to 10,000 contracts on the day.
Farmer selling continues to stall at current price levels and basis on the river and Gulf of Mexico is steady to firm. Afloat barges were bid 75 over the December yesterday and October was bid 72 cents over. Processor bids remain mixed with Decatur, IL holding steady at 15 cents over the December contract and Burns Harbor, IN paying 12 cents over. Blair, NE bids fell by 7 cents per bushel to 35 over the December contract. Trade in the world market was steady yesterday with the US still priced at a considerable premium to South America. Argentina was last quoted near a $35 per tonne discount to US offers and Brazilian offers were thin past December. Cash levels remain firm in Brazil on reports that more corn is being pushed into Europe. Export sales were rather disappointing once again yesterday with only 142,300 tonnes reported for the week ending October 18th vs. 166,800 the week prior. The market was expecting 150-375,000 tonnes. Japan bought 115,000 tonnes and there was a reduction of 120,000 tonnes to China. Cumulative sales are running 5% behind the 5-year average.
A high pressure ridge is still forecasted to set up in central Brazil this week and into the weekend. The ridge will break down early next week which could bring showers in behind it. Showers are expected to be scattered with no general soaking but will still provide relief to some dry areas. Temperatures are expected to reach the high 90's to over 100 the next 5 days in Mato Grosso. Most of Argentina saw drier weather in the middle of this week with heavy rainfall expected to return by the weekend with some areas seeing 0.25-.75 inches. Argentina's Buenos Aires Exchange pegged corn planting at 37% seeded vs. 55% last year.
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