Afternoon Corn: A rare island of stability in a sea of market chaos
<div class=\"default-font-wrapper\" style=\"line-height: 1;font-size: 12pt; font-family: Verdana, Geneva, sans-serif;\"><div style=\"line-height: 1;\"><span style=\"font-size: 12pt; font-family: Verdana, Geneva, sans-serif;\">Afternoon Corn: <br id=\"isPasted\"> <br>Corn futures were a rare island of stability in a sea of market chaos. On the lows, May Corn was ten cents lower, but the day session ushered in more measured trade. Futures finished the day steady to two cents lower. Funds are believed net long roughly 80,000 delta-adjusted corn after aggressively paring back length over the past month; the CFTC is due to opine tomorrow afternoon. Cash corn trade was steady to perhaps a touch easier.<br> <br>To little surprise, the story of the day was the hefty duties imposed by the White House on many world trading partners Wednesday evening. The primary focus appeared to be Asia, sparing neighbors Mexico (#1 US corn importer) and Canada (#1 US corn-ethanol importer) harsh new levies? Indeed, we think the corn market took comfort from subdued Mexican statements released mid-morning? Despite potential stasis on the Mexico front, there are many large US corn importers who took a large tariff lump and are likely mulling retaliatory action. Two big names to watch from that standpoint are Japan (~10 mmt US corn importer) and South Korea (~3 mmt US corn importer). This story has not yet been fully written; keep your news man close!<br> <br>On to the more mundane, the weekly export sales report was surprisingly strong for corn, easily topping 1 mmt. Old crop corn sales for w/e 3/27 were 1.173 million metric tons (mmt), while new crop chipped-in 0.165 mmt. Total sold and shipped for the current marketing year is 54.23 mmt versus 43.85 mmt last year; the current pace is easily on track to meet USDA sales objectives of 62.2. Note roughly 30% of corn commitments have not yet shipped. In theory, some of that could be a target for tariff retaliation? Export news remains very quiet in the short-term. South Korea’s KFA bought a cargo of optional origin corn overnight.<br> <br>Elsewhere, outside markets were understandably perturbed. Tech and economically-sensitive stocks took a shellacking. Crude Oil crashed nearly $5/bbl. The news wasn’t all bad; the US Dollar finished the day nearly 2% lower. A weaker dollar should help US competitiveness, at least to trading partners still willing to do business?!? End-user markets were also under pressure. The next monthly USDA report (April WASDE) is exactly one week today, and we would expect news services to publish analyst estimates tomorrow or Monday.<br> <br>In the options, volatility was a little weaker today as corn broadly shrugged off the day’s tariff jitters. Calendar spreads bounced back a little after a rough couple days. Corn gained a lot on the beans today but was mixed versus various wheat positions. Looking at the charts, early month lows ($4.42 CK) continue to offer meaningful support for corn futures. On the charts, we see continued minor resistance starting at $4.60 CK (which we pushed above briefly today), then more difficult levels every dime higher. CZ also continues to hold support in roughly the same area. We also see resistance for the moment at $4.50 CZ; closing above $4.60 would endanger a short-term downtrend that has developed in that month. Corn’s RSI is neither overbought nor oversold, hanging out in the mid 40’s. <br> <br>KJ</span></div></div>