- US export data has been released as follows:
- The current price rally has seen some huge cash corn sales by US farmers who are happy to part with stored stocks, and cash basis has declined as the market takes on board test additional supplies and end users as well as exporters add to their forward coverage. The market awaits the potential for new crop supplies and we would suspect that cash basis could weaken further as S America takes over export demand from the US beyond July.
- Chicago markets have extended the overnight rally with spring wheat leading the charge. Front month (July ’17) corn futures are flirting with $3.90/bu technical resistance whilst wheat futures break through, which is triggering further fund short covering. The midday weather model is little changed from this morning, though the GFS continues to fail to bring meaningful rainfall forward in time. The EU model in recent days has maintained near complete dryness throughout the next ten days, and in the short term the burden of proof is on the bears.
- It feels as if funds will continue to short cover and/or buy until such time as we see improved US weather conditions actually materialise.