Export ports in some countries may limit their work due to coronavirus
The main reason for the increase in grain prices is the return of China to the US market. As part of the first phase of the trade deal between the two countries, China pledged to buy agricultural products from the US worth $12.5 billion in 2020 and $19.5 billion. in 2021. U.S. Agriculture Department reported that so far, China has bought 756 thousand tons of American corn with delivery in the 2019/20 marketing year. This is the biggest deal since 2017. Also, an important reason for the growth of all agricultural products in price can be dockers’ strikes in the ports of developing exporting countries. They are afraid of getting infected by coronavirus and require quarantine. Particularly, the strike may begin in the largest Brazilian port of Santos in Sao Paulo. A similar demand was made by dockers of the Argentine port of Rosario and dockers of ports of South Africa. Note that corn quotes are now under pressure from low world oil prices. In the United States, 39% of corn is processed into ethanol and bio-fuels, which compete with oil. Accordingly, a rise in hydrocarbon prices may have a positive effect on corn quotes.
Summary of technical analysis
|Buy stop||Above 359|
|Stop loss||Below 331|
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