Last week the Beijing bureau of the US Department of Agriculture was happy to announce that “the [Chinese] government has now abandoned price support policies for all commodities except rice and wheat”. Dalian corn futures traders obviously knew this was coming as prices have been in retreat since peaking in September 2014 at 2,770 yuan per tonne. Simultaneously, open interest soared to a record 2.51 million contracts as they hedged inventory on the way down. Dropping as an A, B, C-type correction with record volume during March’s price slump and becoming oversold on the RSI, last week’s bounce suggests we are starting to try to base. Target 1,900 yuan and then probably 2,100.
