Corn commentary: Futures fall softened by fresh export sales

Corn prices continued to trail the rest of the agriculture complex Wednesday, as hefty falls seen on soybean and wheat extended modest losses to CBOT corn futures contracts as well.

Corn prices have been dragged aloft by both wheat and soybean in recent sessions, but a raft of supportive data cushioned corn from some of the heavier falls seen elsewhere.

The front-month CBOT corn futures contract reached 18:30 London time half a cent lower, versus the five cent losses seen on wheat and soybean, as the USDA revealed the fourth consecutive private sales announcement and the EIA revealed a hefty fall on ethanol stocks.

The March contract stood at $3.61/bu with May also down half a cent at $3.6925/bu.

EIA data showed ethanol production fell marginally but remained high enough to keep the ethanol outlet open wide enough to set the industry on course to exceed the USDA’s corn for ethanol estimates, which set total corn demand at 5.525 billion bushels.

Alongside that, US private export sales confirmed a further 145,000 mt of corn heading to unknown destinations, taking private export sales to over half a million mt since Friday.

That, and the economics that make the US the go-to origin for corn, boosted expectations of decent export sales in tomorrow’s weekly data release, with analysts’ expectations focused on a wide range of between 1 million to 1.7 million mt.

Of physical markets, indications in the Black Sea remained elusive, with new crop November corn heard offered at 63 cents over the December contract – around $156/mt – but only limited indications heard for February and March.

Freight sources also saw the ice situation in the Azov Sea as ‘moderate’ for the time of year, with no major issues around finding berths, although a lack of spot tonnage has seen rates firm.

Buying interest from Egypt was heard in the range of $190-$193/mt, with April corn bid 85 over the May contract basis a panamax port, equating to around $178/mt.

Typically, handy-size panamax port indications command a $2/mt premium over handy-size vessels, equating to an April offer at $176/mt in a market that remains in carry.

As such, Agricensus nudged the assessment down marginally to $174/mt, a fall of 50 cents.

Values elsewhere were broadly unchanged day-on-day, although March differentials in the Argentine FOB Up-River market were heard slightly firmer on the day, with Agricensus assessing at 66 cents over the March contract – up 2 cents and adding 50 cents to the Up River outright assessment at $168.25/mt.