On March 31 we noted:
Yes friends, we're on the WASDE beat. It comes out on April 8th, here's the WASDE site.
Here's the March 10 report.
From DTN:
Watch WASDE for Corn "Ending Stocks
Friday's supply-demand report should show a lower domestic ending stocks number and stocks-to-use falling below 5 percent, reaching a new record-low, said DTN Grains Analyst John Sanow, on the heels of today's strong usage....
My best gut feel (and that's all it is) is that this will be the last positive news for all eternity (or 30 days, which in the pits equals the same time period).
This gut-feel is probably informed by three things:
The chart from Tuesday, note the big gap at $6.92 from the date of the last report:
Secondly, this chart from Yesterday's Smart Money Europe showing the double top on the monthly:
That's not to say that we won't eventually go higher, just that this is a spot where markets might want to take a break.
Finally the small decline yesterday combined with the tentative action this morning reassures me that the giant traders, Cargill, Dreyfus, Glencore etc. don't have an advance read on what we'll see tomorrow.
One word of caution, The Smart Money article concludes:
Win lose or draw, we'll probably have more to say on all this.
This gut-feel is probably informed by three things:
The chart from Tuesday, note the big gap at $6.92 from the date of the last report:
Secondly, this chart from Yesterday's Smart Money Europe showing the double top on the monthly:
That's not to say that we won't eventually go higher, just that this is a spot where markets might want to take a break.
Finally the small decline yesterday combined with the tentative action this morning reassures me that the giant traders, Cargill, Dreyfus, Glencore etc. don't have an advance read on what we'll see tomorrow.
One word of caution, The Smart Money article concludes:
...As a consequence, many traders and analysts have upped their price expectations. Recent surveying by Bloomberg showed a large percentage bullishness. For instance, Goldman Sachs raised their short-term price target to 8.6 USD/bushel (3 month), which would lift prices by another 13 percent in the next months.Here's the World Supply and Demand Estimates site.
Now, we would normally get reserved when seeing large numbers of bulls for a commodity. But with the current powerful fundamentals for corn, we also have difficulty to come up with bearish scenarios that could slam the price on a short term notice, black swan events left aside. The underlying pressure is just too high. Maybe corn prices of 9-to-10 dollars per bushel (or more) could provide some relief to the markets. Until then the price of corn will be popping on a regular basis. For now, sit back, relax and enjoy the movie!
Win lose or draw, we'll probably have more to say on all this.
