WEEKLY CORN REVIEW: Has the Worm Finally Turned?
Positive reaction to USDA report.
Bryce Knorr
Published: Dec 15, 2008
After a bruising second half of 2008, the corn market finally showed signs of life at the end of last week.
There was much to find positive, led by the bullish reaction to Thursday's bearish USDA report. While the government's decision to slash its forecast of corn needed to make ethanol was not a surprise, it's timing was, because most traders believed the change wouldn't come until January. Instead, USDA got most of the bad news out of the way, though both exports and ethanol face an uphill struggle the rest of the marketing year.
Of course, corn's initial rally wasn't really about a bullish reaction. Instead, corn appeared to be merely doing what it's done more than 90% of the time since prices peaked: follow crude oil.
The real deal seemed to come on Friday after Informa released its estimate of 2009 acreage. The consulting firm, like USDA, had been predicting an increase in corn plantings in the spring. It finally came around to the position found first in Farm Futures August survey, and again by our updated survey released Thursday afternoon, namely that producers are ready to cut corn acreage due to high production costs. In fact, the Informa numbers were even more bullish than the Farm Futures estimate. To read Bryce Knorr's complete weekly corn review, click HERE.
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Tagged: usda, farm, farm futures, ethanol, farmfutures
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