Dec Corn closed 3 ¼ cents lower ($3.66 ¾), March 3 ½ cents lower ($3.77 ¼) & July 3 ¼ cents lower ($3.89 ¼)
December Chgo Ethanol closed 0.001 cents a gallon higher ($1.405) & Jan $0.001 cents higher ($1.381)
Weekly Ethanol Grind – 1.033 million bpd vs. 1.030 million bpd week ago – Stocks – 20.5 million bbls vs. 21.0 million week ago
Weekly Corn Export Sales – old crop vs. 400-900 K T. expected – new crop vs. none expected
The path of least resistance continues to be lower in the corn market. Granted we’ve seen a couple of “announced” sales this week it’s just not enough to stem the tide. It is being reported that S. Korea, so far this month, has bought 750.0 K T. of corn mostly from SA and Ukraine. It wasn’t that long ago S. Korea could be depended on to be a good customer of the US as far as corn buying was concerned. It remains my thought that a good portion of this week’s selling can be tied to December corn options expiration on Friday ( a lot of high priced short puts). There is a bright side to all of this; the grind for ethanol continues to improve. I would hate to think where prices would be without this improvement (8 weeks in a row now).
As harvest gradually rolls along the interior river locations are starting to take some hits. Processors are also more hesitant to reach for corn. The Gulf basis is down almost 10 cents from last Friday’s posting. Nearby corn spreads have softened noticeably from where they were mid last week. Old crop continues to lose to the new crop.
The other day I mentioned there is a gap on the weekly continuation corn charts from $3.58 ½ to $3.65 ¾. Today’s low in Dec corn tapped at the high side of that gap. I’m told that once we get into the New Year demand for US corn will improve as SA supply starts to run low. My question is what do we do in the meantime? Some will say it’s the lack of a trade deal with China. My answer to that is China doesn’t need any corn from the US given its decimated hog herd. If China is going to buy any corn they will go to Ukraine first. In summation – I would like to think the aforementioned gap on the weekly charts should represent some sort of support.
Daily Support & Resistance for 11/21
Dec Corn: $3.63 – $3.72
March Corn: $3.73 ½ – $3.82 ½
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