Corn market tumbles with bigger supply
Higher grain stocks and lower than expected demand has sent the commodity market tumbling.
The latest grain stocks report overshadowed the planting intentions report that came out from the US Department of Agriculture last Thursday. USDA estimates US corn stocks at 5.4 billion bushels. Farm Futures Market Analyst Paul Burgener says that was 400 million bushels greater than market predictions.
Burgener says that number just beat the corn price up. On Thursday, the price went limit down on nearby corn futures. The market was closed the next day for the Good Friday Holiday. Burgener says it took another 50 cents off when the market opened on Monday, so the corn price really took a beating. The soybean and wheat prices also dipped after Thursday's report. Burgener attributes that to the bigger than expected stock numbers for those crops, so that also drove those prices down.
After the big market drop, Burgener anticipates it will take a couple days for the market to recover. He anticipates it will take til midweek for speculators to recover from the big market shift.
In terms of exports, wheat has seen above average shipments for the past 8 weeks. After this week's significant drop in commodity prices, Burgener says that brought other importers back into the market. On the soybean side, Burgener says there isn't much move there with the tight supplies, but there is some renewed interest in the US corn crop. He says there are rumblings that maybe China will interested in buying some more corn from the US.
But the big wild card will be the large corn and soybean crops coming out of South America. The first of the weekly crop progress reports came out from USDA on Monday. Burgener says going forward weather will become a more significant market driver.
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