Corn futures have halted its $1.20 downtrend since mid-June as Reuters has broken the news about China planning to cut corn production. Corn futures are up a mere .01 cent today currently trading at $3.36 per bushel for December delivery at the Chicago Board of Trade.
This would be China’s first cut in corn production in 13 years which is reported to be by 3.29M acres, but according to the USDA, China still has 37M hectares devoted to corn – 14M hectares more since 2001. This cut in production is said to be an attempt to reduce massive stockpiles of about 250M tons in inventory.
Danielle Bourbeau, a commodity broker for Capital Trading Group in Chicago, shared her fundamental view of the corn futures market by stating, “Its obvious to see with so much corn in China’s inventory, there won’t be any imports of corn for them any time soon.” Bourbeau adds, “Now what will this do for our corn (futures) market?”
Corn futures trend is “down” with no bottom yet in sight. In my opinion, corn futures prices are treading near production costs so farmers may be wanting to do something about this…
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
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