Brazil Weather Concerns and Strong Export Demand Drive Corn Price Fluctuations

The corn market is currently observing developments in South America, particularly in Brazil, where there's a possibility of a drier pattern that might affect crop yields. In the United States, Allendale Inc.'s survey, a commodities research and brokerage, indicates a slightly higher corn planted area for 2024 compared to previous estimates. Despite this, corn production is projected to be slightly lower due to a trend line yield. Export demand and corn for ethanol use in the U.S. are surpassing USDA projections, with ethanol production slightly lower but still robust compared to the previous year.

Internationally, there are shifts in coarse grain production forecasts, with reductions in some regions offset by increases in others. Weather conditions in Brazil, particularly in Mato Grosso, are being closely monitored, as dry weather patterns could impact crop yields. Ethanol exports from Brazil are expected to remain strong in 2024, driven by increased corn ethanol production.

In Ukraine, corn prices are rising on world markets due to heightened demand from various countries including China, Turkey, Egypt, and the EU. The expectation of a decrease in prices with the arrival of new corn crops from other countries has not materialized, indicating continued demand for Ukrainian corn.

In the U.S., corn futures experienced fluctuations driven by technical trading and weather concerns in Brazil. May 2024 corn futures have seen a price rally since late February, testing short-term resistance levels near $4.45. Despite recent price rallies in corn futures, market stability is influenced by factors such as carryout levels and weather uncertainties.

U.S. farmers plan to reduce corn plantings by about 1.2% this year while expanding soybean plantings by 2.7%. The market is relatively stable with limited fresh demand and no significant market-moving news. Corn futures may receive support from hot, dry weather in Brazil, potentially impacting yields.

The corn price has seen positive momentum, approaching the anticipated target at 449.20. A specific pattern on the chart suggests a potential breach of this level, leading to further gains reaching 461.90. The bullish trend is expected to continue as long as the price remains above 433.50, with a daily close below it signaling a shift in trend. The projected trading range for this period is between 438.00 support and 453.00 resistance.

Data for Technical Analysis (15Min) CFD US Corn Futures - May 24 (ZCK4)

Resistance : 440.46, 440.58, 440.77

Support : 440.08, 439.96, 439.77                 

15Min Outlook  

Source: Investing.com                                         

Buy/Long 1 If the support at the price range 439.78 - 440.08 is touched, but the support at 440.08 cannot be broken, the TP may be set around 440.46 and the SL around 439.63, or up to the risk appetite.

Buy/Long 2 If the resistance can be broken at the price range of 440.46 - 440.76, TP may be set around 440.94 and SL around 439.93, or up to the risk appetite.       

Sell/Short 1 If the resistance at the price range 440.46 - 440.76 is touched, but the resistance at 440.46 cannot be broken, the TP may be set around 439.94 and the SL around 440.91, or up to the risk appetite.

Sell/Short 2 If the support can be broken at the price range of 439.78 - 440.08, TP may be set around 439.40 and SL around 440.61, or up to the risk appetite.       

Pivot Points Mar 14, 2024 02:46AM GMT