Morning Futures Roundup

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Asian Buying Lifts Corn Futures


 Fundamentals

The recent sell-off in Corn prices certainly piqued the interest of Corn buyers in Asia, as an unexpected purchase of U.S. Corn by China sent Corn futures prices soaring. Many traders believe that China was the purchaser of 116,000 metric tons of old-crop Corn reported by the USDA on Thursday. Some traders were not expecting China to be in the market for Corn, but the recent price decline was perhaps enough to entice China back into the market. In addition to China, South Korea was also a large buyer of Corn, with just over 450,000 tons purchased the past week. Corn futures also received a boost when the widely watched private forecaster Informa Economics projected that U.S. producers will plant 91.8 million acres to Corn this coming year. This was slightly below the USDA estimate of 92 million acres. Next up for grain traders will be the highly anticipated USDA Prospective Plantings report due out on March 31st. This report could set the tone for Corn prices early in the season, at least until traders turn their focus to growing conditions and the weather once summer begins.


 Technical Notes

Taking a look the daily chart for the July/December Corn spread, we first notice that prices seemed to find good support once the spread fell to a 75.00 July premium. The recent rally took the spread back above the 50-day moving average, which currently is near the 96.00 July premium level. The next resistance point in the spread is seen at the 20-day moving average near the 107.00 area.



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