Corn Commentary


Corn – Just My Opinion

Dec Corn closed 3 ¼ cents lower ($3.65 ½), March 1 ¾ cents lower ($3.76 ¾) & July 2 ¼ cents lower ($3.87)

January Chgo Ethanol closed $0.003 cents a gallon higher ($1.374) & Feb $0.005 cents higher ($1.390)

Weekly Corn Export Sales – 546.1 K T. old crop vs. 500-900 K T. expected – 2.4 K T. new crop vs. none expected

Weekly corn export sales were disappointing to those expecting a pick-up in exports sooner vs. later. The thought is that Brazil will run out of exportable corn supplies sooner vs. later due to huge export sales so far this season as well as big-time demand from their local cattle feeders. Brazil has had an excellent beef export program with China which in turn has been driving local corn prices higher. Adding to the idea of better US corn exports is the fear Argentina will enact an increase in export taxes as earlier as next week. I’m starting to hear of a pick-up in cash movement as many feel the recently stout basis levels will erode once we get into the New Year.

Processors continue to stand in for cash corn. River locations, however, are starting to ease. The Gulf has been easing as well. Spreads are acting funky once again. Dec loses to March forward from the idea that corn deliveries could increase. March, however, gains on May and July. The current crop year eases for the second day in a row vs. the 20/21 crop year.

Not a very spiffy looking performance for the flat price corn market on Thursday. Given the idea that exports will soon improve flat price corn will do well for itself to honor the suspected support area, $3.75 to $3.70 (March), which was established in early September. The spec trade remains a sizable short while it is the producer that is the sizable long.

Daily Support & Resistance for 12/06

March Corn: $3.73 ¾ – $3.81     

July Corn: $3.84 – $3.91

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.