corn market usd dollar In May, the US Increased the Use of Corn for Ethanol

Corn Futures Are Down-Global Economic Worries

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Chicago Board of Trade Market News

Outlook: Corn futures are down 25 ¾ cents (3.8 percent) this week as a combination of global economic worries and managed money selling pressured commodity markets. Commodity and equity markets received bearish news early this week as several analysts increased their expected odds of an economic recession occurring in the U.S. and around the world in 2023.

This week’s economic data, however, held a mix of positive and negative implications and a recession, which could be bearish raw commodity demand, is still far from certain. Regardless, funds took the opportunity to liquidate long CBOT holdings, which pushed futures lower. Additionally, farmers used the December rallies in corn, soybeans, and wheat to make cash sales, which added pressure to the market.

The weekly Export Sales report is delayed until Friday, 6 January due to the New Year’s holiday, but Tuesday’s Export Inspections report featured 0.667 MMT of corn inspections for the last week of December. That volume was expectedly down from the prior week due to the holidays and YTD inspections for the 2022/23 marketing year total 9.58 MMT, down 27 percent.

Ethanol production was down 19 percent for the week ending 30 December as the holidays and cold weather reduced run rates. Ethanol stocks slipped 0.8 percent from the prior week but are 14 percent greater than this time in 2021.

Grain Crushing Numbers

USDA’s monthly Grain Crushing numbers reported 11.37 MMT (447.4 million bushels) of corn was used for fuel ethanol in November 2022, down fractionally from the prior month and down 4.2 percent from the prior year. Corn used for industrial and beverage ethanol also slipped from the prior year but beverage ethanol usage was just below the five-year high set in 2021. DDGS production in November totaled 1.615 MMT (1.78 million short tons), up 1.9 percent from October but down 11 percent from 2021.

From a technical standpoint, March corn is pulling back from trendline resistance near $6.83 that it tested at the end of December but was unable to break. On Thursday, the contract caught a bid a few cents below the psychologically-important $6.50 level as commercials became more active buyers. Technical support still lies at $6.48-6.50, followed by long-term support at the 7 December daily low of $6.35.

Import/Export Statistics

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