While overbought and vulnerable to a short-term correction due to rains in Argentina, the trend in the corn market looks to remain up, as demand out of the US is strong and global supply should be tightening as well. China has boosted corn processing capacity by a whopping 33 million tonnes in the past year to 137 million tonnes overall.  This is bullish as more and more of China’s corn moves to ethanol production.  May corn settled down 3 cents on the session Friday, which left the market up 5 cents on the week.

Looking ahead to the US 2018/2019 crop season, if we use an estimated planted area of 89 million acres, a yield of 169 bushels per acre, beginning stocks of 2.127 billion bushels and with the outlook boards demand numbers, ending stocks would come in at 1.347 billion bushels.

At the end of 2017, managed money traders were net short 230K contracts, now they are long 163,534.  The record for net long is 429,189 contracts.  Corn should remain supported by strong demand.  Support in corn futures comes in at 386 with resistance at 400.

Corn May ’18 Daily Chart