May Corn closed 1 ¾ cents higher ($3.04 ½), July 2 ½ cents higher ($3.14 ½) & Dec 3 ½ cents higher ($3.33 ½)
May Chgo Ethanol closed $0.064 cents a gallon higher ($0.975), June $0.092 cents higher ($1.031)
Weekly Corn Export – old crop vs. 700 K – 1.200 M T. expected – new crop vs. 200-450 K T. expected
Weekly Ethanol Grind – 537 K bpd vs. 563 K previous week – Stocks – 26.3 million bbls vs. 27.7 million previous week
May corn registers new contract lows but $3.00 holds and the market finishes higher on the day. July corn comes within a ¼ cent of its contract low and it too finishes higher on the day. The ethanol grind can be assessed one of two ways; the grind is still coming down but stocks are starting to come down. May deliveries start tomorrow and the May/July spread moves out to a 10 cent carry. The thought of deliveries goes both ways – the prospect of market making demand (the lack thereof) suggests sizable deliveries but the other side of that is does the commercial want to give away the large carry. Weekly export sales are out in the morning and thoughts are we should see some pretty decent sales. World corn prices are some of the cheapest we have seen in years. The question then becomes how much business the US will see.
The interior corn basis has a steady but firm look to it. River locations are mostly steady but with a firm undertone. Where ethanol plants are still operating they are standing in for corn. Country movement remains minimal. The midday posting for export bumps up a bit but overall hasn’t done much over the past two weeks. As I mentioned earlier spreads continue to put more carry into the price structure. Many of the corn spreads are either at contract lows or at wide levels not seen for quite some time.
Old crop corn either makes new lows or challenges recent contract lows and closes modestly higher on the day. I have to think the make-up of deliveries and export sales will dictate near term direction. I would like to say today’s suggested upside reversal is something we can hang our hats on but we have seen these suggestive reversals before. There’s an old adage that suggests big deliveries in a depressed market opens the door for a turn around as the thought is it can’t get any worse. Coming into this week my idea was if we see corn prices with a “2” in front of it I would take a speculative shot at ownership (just missed it today).
Daily Support & Resistance 4/30
July Corn $3.10 – $3.20
Dec Corn $3.28 – $3.38
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