By Joanna Newman
FOLLOWING the sell-off in the wake of last weeks bearish production reports, US maize prices have stagnated in recent days.
South America is very much the driving factor at this time of year, and there is little news coming out of the Southern hemisphere to cheer American farmers.
In Argentina and Brazil, the maize crop is at the crucial stage of pollination. Both countries are enjoying ample rain, with forecasts of more to come, which will boost crop yields.
Meanwhile the Brazilian currency devaluation earlier this month has made Brazilian exports more competitive. This will mostly impact global soya bean shipments, but is clearly putting pressure on all US grain commodity prices, including maize.
The Chicago March futures contract settled at 215.00¢/bushel on 20 January. Little had changed from 215.25¢ a week ago, while the cash market has also been flat.
US producers have been reluctant to bring their stocks to market because of low prices, and this trend has had the desired effect of preventing further erosion.
Meanwhile, logistical problems have leant some price support, as icy conditions hamper domestic river barges from reaching the coast.