Friday, 28 April 2017

Corn firms after deep losses, concerns about exports to Mexico

In Commodity News 28/04/2017

Chicago corn futures edged higher on Thursday as the market took a breather following deep decline in the last session on concerns over exports to Mexico should the United States withdraw from the North American Free Trade Agreement.
Wheat and soybean edged higher on bargain buying.
The Chicago Board Of Trade most-active corn contract rose 0.2 percent to $3.67-1/2 a bushel by 0257 GMT, having closed down 1.3 percent in the previous session.
Soybeans climbed 0.2 percent to $9.58-3/4 a bushel, having closed down 0.9 percent on Wednesday, and wheat gained 0.2 percent to $4.27-1/2 a bushel, having closed down 0.1 percent in the previous session.
The corn market is likely to struggle to rally as U.S. weather improves for planting the crop.
“Meteorologists removed some of the rain in their extended forecasts for the U.S. Midwest, which prompted traders to also remove some of their weather premium,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
“We suspect a media blitz yesterday regarding U.S. trade policy was probably also a contributor to the day’s falls.”
Corn was pressured on Wednesday by jitters about U.S. exports to Mexico after a senior Trump administration official said a draft executive order to withdraw the United States from NAFTA, a U.S., Mexico and Canada trade pact, is under consideration.
Soybeans faced additional pressure from weakness in Brazil’s currency, the real, which could prompt Brazilian farmers to sell more of their record-large soybean harvest.
Wheat drew some support from concerns about unfavourable weather expected in the southern Plains this weekend that could damage developing winter wheat.
Commodity funds were net sellers of CBOT corn and soybean futures contracts on Wednesday, traders said. They were net even in wheat and net buyers of soyoil.

Source: Reuters (Reporting by Naveen Thukral; Editing by Subhranshu Sahu)