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Corn cements itself into $7 market | Wednesday, May 5, 2021

Mexico buys, China cancels orders of U.S. corn.

On Wednesday, the CME Group's farm markets go strong into the night.

At the close, the July corn futures finished 11 3/4¢ higher at $7.08 3/4. New crop September futures finished 20 3/4¢ higher at $7.08 1/2. December corn futures ended 24 1/4¢ higher at $6.04 1/4. 
July soybean futures settled 4¢ higher at $15.42 3/4. August soybean futures ended 9 1/2¢ higher at $14.91 1/2. New crop November soybean futures closed 19 1/4¢ higher at $13.82 1/4.

July wheat futures closed 17 3/4¢ higher at $7.44 3/4. 

July soymeal futures finished $2.90 short ton higher at $424.40.

July soy oil futures closed -0.12 lower at 63.46¢ per pound.

In the outside markets, the NYMEX crude oil market is -0.21 lower (-0.32%) at $65.48. The U.S. dollar is higher, and the Dow Jones Industrials are 184 points higher (+0.54%) at 34,317 points.

On Wednesday, private exporters reported to the USDA the following activity:

  • Export sales of 184,100 metric tons of corn for delivery to Mexico during the 2021/2022 marketing year;
  • Export sales of 147,320 metric tons of corn for delivery to unknown destination.  Of the total, 45,720 metric tons is for delivery during the 2020/2021 marketing year and 101,600 metric tons is for delivery during the 2021/2022 marketing year; and
  • Cancellations export sales of 140,000 metric tons (5.5 million bushels) of corn for delivery to China during the 2020/2021 marketing year. 
  • The marketing year for corn began Sept. 1.

Bob Linneman, Kluis Advisors, says that monthly export data is positive, but weekly sales numbers are important to the market too. 

“March corn export data proved to be a new all-time monthly record, displacing the May 2018 record. For the current marketing year on corn, exports (to this point) are the second-largest on the books. This all sounds great for the corn bulls, but we still need to see the weekly export reports post strong numbers to maintain the rally. Soybean traders were excited to see that U.S exports for the current marketing year are on a record pace, and Brazilian exports for April were a new record. However, some traders are getting nervous about the rumors of a slowdown of imports to China. They are trying to determine the impact of the resurgence of African Swine Fever across the country," Linneman stated in a note to customers.  

Linneman added, "It is unusual to see how prices have reached the $7 mark in corn and $15.50 in soybeans--and the market has paused. Daily ranges have been wild, but traders seem content at these higher prices."

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