As I've eluded the past couple of weeks, we absolutely can't afford to see the strong demand story start to unravel. I personally don't see that being the case, but I'm also aware of the fact I might be viewing the field from my own perspective, which is with a bullish lens.
Earlier this week, we had a little down tick in ethanol production and a further build in surplus. Yesterday, we were hit with the weakest weekly export data of the new marketing year and well below market expectations. Not only was the sales number extremely weak, but we also had to digest a sizable cancellation from an "unknown" destination. Mexico, Japan, Columbia, Egypt and South Korea remained buyers of U.S. corn, but in small quantity.
Bulls argue it's only a temporary blip, as river barge freight to the Gulf during the heavy rains, pushed U.S. prices to higher levels compared to competition from Argentina and Ukraine. Remember, Ukraine's crop is now thought to be over 50% harvested. Let’s also keep in mind, here at home, we've seen about a +30 cent rally the past few weeks off the lows.
To receive more of my thoughts on the +30 cent rally, click HERE.
The opinions of the author are not necessarily those of Corn+Soybean Digest or Farm Progress.