Corn firms after 3 days of losses, dismal ethanol demand caps gains
Chicago corn futures ticked higher on Wednesday, recouping some of the sharp losses suffered earlier this week, although prices remained near more than a decade low on weak demand for the grain-based fuel ethanol.
Wheat slid, falling for three of four sessions, while soybeans ticked higher.
“Corn crop-outlook in most exporting nations looks pretty good. U.S. planting progress is going on very well,” said a Singapore-based grains trader.
“At the same time there is a lack of demand for ethanol.”
The most-active corn contract on the Chicago Board Of Trade was up 0.1% at $3.12-1/4 a bushel by 0334 GMT. The contract was not far from its weakest since 2009 reached last week at $3.09 a bushel.
Corn has lost 20% so far in 2020 because of a plunge in demand for ethanol as shelter-in-place orders keep drivers at home.
Wheat fell 0.4% to $5.23-3/4 a bushel on Wednesday and soybeans were up 0.1% at $8.32-3/4 a bushel.
U.S. farmers planted 27% of intended corn acres as of Sunday, the U.S. Department of Agriculture said late Monday, topping most analysts’ expectations and the five-year average of 20%.
U.S. farmers have gotten a solid start on their corn and soybean planting efforts this spring after making impressive progress last week, which is much welcomed after last year’s historic difficulties, Karen Braun, a market analyst for Reuters, wrote in a column.
Meanwhile, hopes for a recovery in corn demand got a boost as U.S. President Donald Trump on Tuesday ordered meat-processing plants to stay open to protect the food supply in the United States, despite concerns about the coronavirus outbreak.
Restrictions have also caused restaurants’ meat consumption to dive, dissipating the need for feedgrains such as corn, soybeans and wheat.
In Argentina, farmers have suspended soybean and corn harvesting in the country’s central grains belt due to heavy rains, while the extra moisture was expected to help wheat planting scheduled to start in May, growers and analysts said on Tuesday.
Commodity funds were net sellers of Chicago Board of Trade corn, soybean, and soymeal futures contracts and net buyers or soyoil and wheat futures, traders said.
Source: Reuters (Reporting by Naveen Thukral; Editing by Aditya Soni)