Chicago Board of Trade Market News
Outlook: USDA’s March 31 Planting Intentions report shocked the market and prompted an all-time record volume that day of 930,250 corn contracts traded. Funds were reportedly short 1 billion bushels. However, a 93.6-million-acre corn planting number is unsustainable. It includes proposed increases such as 24 percent more corn acres in dry, short-season North Dakota. The number will likely drop by one to two million acres and then there is the uncertainty of weather and yield. However, it would take an unlikely [emphasis] large yield drop to achieve a corn ending supply number less than the current marketing year. Only time will tell whether too many farmers were short-sighted in not better forward selling and thus hedging their 2016 crop.
Still, there are bargain hunters and the market has just managed five straight days of gains, climbing 10 cents on the May contract since last week’s bearish USDA report. Meanwhile, South America has been pricing its corn aggressively but heavy rains in Argentina have slowed harvest and getting corn to the ports, which has spiked the spot market.