Dec Corn closed 1 ½ cents lower ($3.72), March ¾ cent lower ($3.81 ¼) & July 1 ½ cents higher ($3.91 ¾)
December Chgo Ethanol closed unchanged ($1.469) & Jan $0.024 cents a gallon lower ($1.385)
The idea that 4.9 million acres of corn has yet to be harvested did little for the corn market on Tuesday; just an inside day of Monday. The trade would still like to believe that as we move into the New Year US corn exports will improve due to declining Brazilian corn stocks. This may be true but at this point in time it remains speculation as recent sales and shipments are not yet there.
Interior river locations continue to show increasing basis levels. Central Midwest processors rolled out of Dec basis into March at a 10 cent spread. Eastern Midwest processors are now showing the best basis levels. The midday posting at the Gulf suggests steady at recent highs. I’m told movement remains nothing to write home about other than previously contracted sales. We have yet to see any deliveries against the December contract. Spreads involving the Dec were firm early in the session and then sagged suggesting we just might see some deliveries sooner vs. later. Corn spreads ran mixed March forward; March loses to July while July gains on the Dec 2020.
Today’s inside day does not negate the recent attempt to rally. It seemed like intra-market spreading dominated the flat price trade. Given our lack of market making business vs. 4.9 million acres of unharvested corn I’m beginning to lean towards a mini trading affair for the near term. As of this writing I don’t we have enough to prompt the spec shorts to cover but then again we don’t have enough for them to add to their net shorts.
Daily Support & Resistance for 12/04
March Corn: $3.77 – $3.87
July Corn: $3.87 – $3.97
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.