From The Linn Group
April 12, 2012
Linn Corn: Higher with Supportive Outside Markets
Overnight, the corn market closed slightly higher on a relatively quiet night with a small trading range. The export sales this morning were strong at almost 1.0mil and it was the usual suspects, Japan, Mexico, So Korea doing most of the buying with China only buying 60,000mt. We haven’t heard about China buying any US corn lately and we got the confirmation last week on China sales. The outside markets will be supportive this morning with the US$ down about 40 points and crude and stocks are higher. There isn’t a story in corn like there is in beans, so it should be difficult for corn to really get up and make new highs unless we get some news. I would suspect corn is settled into a trading range until we get done with corn planting and figure out how the crop looks. There is some dry areas across the Midwest, but the majority of the Midwest looks good. There will be some rains moving across the Midwest this weekend which will park some planters, but many farmers will welcome the range and remind themselves that it is only April 15th this weekend and still very early. The corn market will be called to open around where it closed overnight, but I expect it will be a little higher.
Cash corn again supportive to spreads and front month flat price. Hard to press when corn is hard to replace. This should resurrect the spreads immediately. New crop corn has faltered at the breakout at 5.55. This should continue to be a tough area for flat price. Try to extend new crop sales on test of this level.
GLOBEX Overnight Contract Last Net Change High Low Volume ZCK12 638^2 2^2 639^4 636^4 10180 ZCN12 628^6 1^6 630^0 627^0 8963 ZCU12 566^0 1^6 566^6 562^6 1065 ZCZ12 548^2 1^4 548^6 544^4 4468
LaSalle Street News Early Opening Calls:
LaSalle Street News Top News
*** USDA Corn 11/12 Export Sales Net: 959,100 mt; 12/13 Net: 16,700 mt; expected 450k-850k mt
*** Grain merchandisers said overnight that Nonghyup Feed of S Korea bought 55,000 mt of Corn for a reported $2.37/bu over December 2012 futures, the corn is for early October delivery.
*** In a tender that closed earlier this week, traders report S Korea’s MFG group bought 132,000 mt of Corn from Toepfer and Cargill for July-August delivery. Prices were between $305.98/mt and $324.80/mt
*** CEO of Argentina Rosario Grain Exchange said he hasn’t seen any improvement to local markets because of the country’s exports regulation reforms that were implemented back in January, acc. to a down Jones interview.
*** USDA weekly data shows broiler type egg sets down 4% from the eggs set the corresponding week a year earlier, broiler type chicks placed down -4% from the year ago week
*** Average Midwest Spot Ethanol Profitability improved off yesterday’s corn break, and is viewed largely breakeven, with small losses of 5-10 c/bu possible – all calculations include fixed costs & basis, acc. to analysts
*** Western Plains Ethanol in Kansas said they expect to receive $5 mil in USDA funding to build an anaerobic digester, which would replace fossil fuel usage
*** Grain buyers confirm Vivergo’s 100 mil gal/yr UK wheat-to-ethanol plant received its first grain deliveries; Vivergo is a joint venture that includes oil giant BP & DuPont
*** Pending Tender: Japan’s Ag Ministry announced yet another SBS tender on Wednesday seeking 200,000 mt of feed Barley and 120,000 mt of feed grade Wheat in a tender that closes on April 18th
*** Pending Tender: Qatar on Wednesday announced a tender for 134,400 mt of optional origin feed grade Barley with a tender deadline of April 23rd
*** Dalian Sept. Corn futures were down – 1 @ 2,432 yuan/mt.
*** CBOT Corn Volume & Open Interest for April 11th 2012 was 400,852; Open interest decreased -1,135 to 1,348,458.
*** CBOT Ethanol Volume & Open Interest for April 11th 2012 was 939; Open Interest decreased -73 to 11,802.
*** Weather: 6-10 Day Forecast: Above Temps East, Normal to Below West. Above Precip East, Below West
*** Outside markets. Crude Oil up 42c @ $103.12; Gold off -$6.10 @ $1652.90 ; Silver off -1c @ $31.51 ; US $ index off 31 pts @ 79.67
LaSalle Street News Cash Markets
*** CIF Corn steady up 3. April +64 to +66, May +62 to +65, June +63 to +??, July +60 to +63, Aug. +80 to +105, Sept. +59 to +65, OND +59 to +63
Copyright 2011 The Linn Group, Inc.
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