Bearish sentiment lingers for US corn after Friday reports

US corn futures start the week lower, extending losses from Friday following bearish acreage data released after the World Agricultural Supply and Demand Estimates (Wasde) report.

In its annual acreage report, the US Department of Agriculture (USDA)'s Farm Service Agency (FSA) declared that total US planted corn acres, including failed acres, amounted to 93.03 million acres.

The sum of planted acres at 92.99 million acres, which excludes volunteer and failed acres, raises the potential that the USDA will increase its planted area estimate in next month's report and supported a bearish sentiment in the market.

"The FSA numbers that came out on Friday implied that the final acreage could be as much as 1.8 million acres higher than the present USDA acreage assessment, " Charlie​ Sernatinger of Marex Capital told Agricensus.

According to the USDA's annual Prospective Plantings data released at the end of June, the current corn planted area for all purposes in 2023 is estimated at 94.1 million acres, the third largest since 1944.

Corn production for 2023/24 is currently forecast at 15.11 billion bushels (384 million mt), which would result in the second highest on record behind 2016/17.

The USDA's current projected yield per harvested acre is 175.1 bpa, which was lowered from 177.5 bpa in the July report.

Advance Trading's Larry Shonkwiler advised, however, that suggestions indicate that the 175.1 bpa estimate is the lowest number the market will see this summer.

Beneficial rains over the past month have improved drought conditions within corn production areas, which has fueled expectations of improved yield potential.

"We have had extremely good weather for the crops for the past month and a half, and the corn market went through its critical yield-determining phase of pollination with no stress to the crop," Charlie​ Sernatinger said.

According to the US Drought Monitor, as of the week ending August 8, approximately 49% of corn production is within an area experiencing drought, down from 57% the previous week and from the high of 70% recorded in late June.

Kelly Herrick, another US-based analyst with Advance Trading advised that, while the US might not have the bumper-type yields across the entire corn belt, the risk of a crop disaster is probably off the table.

"The supply/demand picture looks comfortable at a 2+ billion bushels carry out," he added.

Following the data releases Friday, the latest weekly data from the Commodity Futures Trading Commission showed that investors of US corn overturned a net long position in the week to August 8.

The complex has shifted between net long and net short seven times since March, when it emerged from a dominant net long position that had stretched back to August 2020.

At 0955 Eastern time, the CME September and December nearby futures contracts were down by 5 c/bu to $4.69/bu and $4.82/bu, respectively.