Nataly Kambur
Stock exchange news, corn. Corn prices have been rising during the previous week after the decline caused by the reaction to January report of USDA. The reasons of the rise are slightly smaller dollar rate and high export demand for American corn. Weekly export sales have amounted to 958 mln.t.
Current bearish factors include:
1) Rise, according to January report, of expected US production from 12.310 to 12.358 bln.bushes and of global production to the record of 868.06 mln.t during the season of 2011/12.
2) Rise of expected ending stocks to 128.14 mln.t
3) Rise of China crop in 2011 by 8.2% to the record point of 192 mln.t, which can mean the decline of China’s demand for American corn.
4) Decline of domestic demand for fodder corn after USDA report about the number of chicken that has dropped to 50.2 mln. as of November 1st, which is the minimal point for the last 15 years.
Current bullish factors include:
1) Fear of drought in South America. According to Agroconsult agency, over 11 mln.t of corn crop is already lost in Argentina and Brazil – second and third largest world producers accordingly. At the same time, Mexico, the fourth largest producer, has lowered its expectations of 2012 crop from 24.5 to 22 mln.t because of drought.
2) January report shows that export of American corn in 2012 is expected to rise from 1.6 to 1.65 mln.t
3) Record ethanol production in the USA, the volume of which at the beginning of the year amounted to 963000 barrels daily.
According to the analytics of the Department of Derivatives Trading within Masterforex-V Academy, following the seasonal tendency, consolidation will continue to February 7th or around. This will be followed by a rising trend that will last till March.
Nataly Kambur
