Funds start covering Corn Shorts

Overnight- Grain and oil seeds are solidly higher overnight.

Funds covered 45,000 net shorts in the corn market on the last CFTC report and the market response was less than robust.

You still lost 9 cents on the 5 sessions included in this report.

You were running up against first notice day and there were a lot of March basis contracts to be priced or rolled and once you got past that we got a 12 cent rally.

We are still looking for a close in May corn over 4.35.

Soybeans, however, added 24K shorts (-160,653) and are currently 8000 contracts from a record short.

We are seeing rising soybean basis in Brazil in the short term which will be helpful if we can get a longer run.

Bottomline

If we are going to see a real short covering of corn, we might have a shot at a 40 to 50 cent rally. Soybeans will need to see higher prices in Brazil along with shrinking production to get a decent price recovery. We will be focusing on US weather going into planting season and possibly build in some risk premium. NFC Grain Comments Options -new (13)