Chicago Board of Trade Market News
Outlook: Fund managers had built a sizable long position in corn contracts and the approach of February meant that they needed to reduce their positions in the nearby March contract. The lack of any new bullish catalyst meant that buyers could continue to step back and purchase at steadily lower levels. The result has been the recent sell-off. This circumstance is currently presenting end-users of corn a chance to cover spring needs at favorable price levels.
The arrival of February has more significance than just the need for traders to adjust their positions. Planting intentions normally become a dominant topic of market conversation around the middle of February. The general consensus seems to be that U.S. corn acreage will be lower this spring than a year ago. However, estimates may widely vary because the price ratio between November 2015 soybeans and December 2015 corn is currently not a good indicator about the extent of any decline in U.S. corn acreage. As always, spring weather and rotation patterns will also influence plantings.
USDA will give a preliminary estimate of crop acreages at the Agricultural Outlook Forum that will occur on February 19-20, 2015 in Arlington Virginia. There, the results of actual planting intention surveys will be published in the Prospective Plantings report on March 31. Afterward, the actual acreage estimates will be published on June 30, 2015.