Corn Futures Rise on Speculation Supply Could Tighten
By Kirk Maltais
--Corn for December delivery rose 1.2% to $4.13 3/4 a bushel on
the Chicago Board of Trade on Wednesday, its highest close since
July 2019 amid speculation that U.S. corn yields could be lower
than previously forecast as the harvest nears completion.
--Soybeans for November delivery rose 0.8% to $10.72 a
--Wheat for December delivery fell 0.4% to $6.29 3/4 a
Slim Fit: Corn traders bet that next month's WASDE report could
show falling yields. "Hearing of some lower test weights than
expected across the U.S., which may have an impact on national
yields," Marex Spectron said. In October's WASDE, the USDA reduced
its outlook for the corn yield this year by just 0.1 bushel per
acre to 178.4 bushels an acre. "The market was surprised by the
USDA action of not bringing down yields in the October WASDE, and
some areas may not be quite as good as first thought," Marex
Southern Comfort: Grains traders again focused on the prospect
of planting delays in South America, the chief competitor to the
U.S. on the grains export market, according to Karl Setzer of
AgriVisor. "Planting is delayed in Brazil but is starting to gain
momentum, and will soon be at normal rates according to sources in
the country," Mr. Setzer said.
Covid Boomerang: Data released by the EIA on Wednesday showed
that both U.S. ethanol production and inventories are down from the
previous week, which was seen by some traders as a possible sign of
states amping up restrictions to limit a resurgence of the new
coronavirus during this year's flu season. "President Trump
promised that there would not be another national shutdown, but
some high-driving states are threatening localized shutdowns that
risk seeing lower ethanol demand at least partially offset the
strong export demand that we are seeing this year," said Arlan
Suderman of StoneX.
Bounce Back: Grain traders surveyed by The Wall Street Journal
predict U.S. corn export sales will post a rebound in Thursday's
weekly USDA report. They anticipate sales to be anywhere from
800,000 metric tons to 1.4 million tons, well up from last week's
total of 655,200 tons. This week, the USDA has announced multiple
flash sales of U.S. corn to Mexico. Additionally, China is
speculated to have an interest in buying U.S. corn due to weather
issues affecting its own crop.
--Ethanol producer Valero Energy Corp. will release its
third-quarter earnings report before the stock market opens on
--The USDA will release its latest weekly export sales numbers
at 8:30 a.m. ET Thursday.
--The USDA will release its monthly cold storage report at 3
p.m. ET Thursday.
--The USDA will release its monthly livestock slaughter report
at 3 p.m. ET Thursday.
Write to Kirk Maltais at firstname.lastname@example.org
(END) Dow Jones Newswires
October 21, 2020 15:46 ET (19:46 GMT)
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