Corn commentary: Futures fall amid prospect of S. American competition
Corn futures dumped the gains made in the previous day's trading as Wednesday brought a weaker Brazilian real and the prospect that US supply could be met by glut of Brazil's safrinha crop later in the year.
By 1300 Eastern time, the May contract was trading at $5.344/bu, down $0.104/bu on the day with the July contract changing hands at $5.232/bu, down $0.094/bu.
Brazil's currency, the real, weakened by close to 1.5% against the US dollar to BRL 5.76, giving importers more incentive to buy Brazilian corn.
And with talk emerging that the US crop would come on line as soon as August in the southern states, this would likely converge with the start of Brazil's export season, delayed by a month owing to heavy rainfall in recent months.
In the cash markets, US Gulf cash premium offers continued to hold amid an absence of strong demand with the April assessment for the Gulf made at 80 c/bu over May futures, unchanged on the day.
Further south, Argentina's Up River complex offers fell by 1 c/bu with April assessed at 47 c/bu over May futures.
In Asia, corn futures on the Dalian exchange were broadly stable since yesterday, with the May contract recorded at CNY2,776/mt ($429.05/mt).
Trading activity in South Korea remained quiet with no trades heard over the day.
Cash offers to Vietnam for May loading moved up 1.6% since yesterday and were captured at $290.70/mt delivered to Phu My and Cai Mep in the south, and at $293.7/mt CFR Hai Phong in the north.
At the time, the levels reflected premiums of 197 and 205 cents over the May contract respectively, with CBOT futures in red.
Few changes could be discerned in Ukraine's corn market Wednesday, with the lowest offers reported on the day heard at $266/mt FOB HIPP, while at the same time an offer for a panamax into China was reported at $267/mt Mykolaiv with a top off option in Ochakiv.
Offers for new crop corn November loading were heard at around $227/mt FOB HIPP, but a lack of bids was reported.
In Romania, offers for April loading were maintained at €221/mt FOB CVB and at around €184/mt for new crop October-November loading.
Elsewhere, Algerian state grain importer ONAB announced a tender for 30,000 mt of corn to be delivered by April 15, with the tender set to close on March 4.
Brokers thought the corn would most likely be sourced from Argentina.