This past week had plenty of news in the corn arena, which is typical for a WASDE week. However, WASDE took a back seat to the derecho weather event last Monday, confirmation of corn acreage prevented from planting, a sizeable net short covering, and strong exports.
The market received confirmation Wednesday of record potential for this year’s crop, with USDA increasing projected yield to a hefty 181.8 bushel per acre. This is 3.3 bushels higher than the July/trendline yield figure and on the higher end of analyst expectations. Even so, the market had already priced in a lot of this bearish supply scenario, and Monday’s derecho that tore through the Midwest fueled doubt that we may lose some production in future reports.
After the WASDE report failed to produce any bearish momentum, the bulls jumped in, covering a large portion of their nearly 200,000 net short positions.