Some fundamental information came out last week to drive corn futures prices, but the dominant market factor was the risk-off/risk-on trades of the speculative community. This allowed corn to drop to short-term support around $4 for the Mar-21 contract before retracing to near $4.20 and settling at 4.1375 for the week.
Supply-side bullishness remains as analysts are increasingly challenged to project production for 2020/21 ahead of the November WASDE report. In the U.S., Informa reduced its yield estimate to 175.7 bushels per acre. If realized, domestic production could fall by about 200 million bushels. The Ukrainian situation appears to be even more dire than initially expected: USDA’s projection—as of now anyway—appears to be significantly overstated. Forecasters have estimated Ukraine’s corn crop as low as just under 30 MMT compared to USDA’s 36.5 MMT.
South American production also remains a question. USDA is likely to reduce that figure by at least a couple million metric tons to be more in line with CONAB‘s Brazilian forecast, closer to 105 MMT. Though less likely, USDA may lower Argentina’s production by a couple MMT.