May-21 corn futures briefly test $5 after weeks-long rally
Corn futures have posted an astounding rally that began in the middle of December and accelerated through the first week of January. Supported by expectations of an additional downward revision to 2020/21 domestic and Argentine production and a weak dollar’s perceived impact on export demand, the prevailing market view is that prices will remain elevated.
Fundamentally, all eyes are on tomorrow’s WASDE—and arguably more concern exists for soybean forecasts (and how they will ultimately impact corn prices). Expecting a drop in yield, analysts’ average corn production expectation is around 14.45 billion bushels, down about 50 million bushels from the December report. The average ending stocks projection is just shy of 1.6 billion bushels which would be about a 100-million-bushel drop from last month’s report. Grain stocks at the beginning of December are estimated to have been 11.75 billion bushels, but there is far less in the way of consensus among analysts on this number. The range of forecast was as low as 8.2 billion bushels to as much as 12.27 billion in Bloomberg’s survey.
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