March corn closed 3 ¾ cents higher ($3.91 ½), July 3 cents higher ($4.04) & Dec 2 cents higher ($4.04 ½)
January Chgo ethanol closed $0.015 cents a gallon lower ($1.360), Feb $0.022 cents lower ($1.371)
Weekly Corn Export Sales – old crop vs. 300-750 K T. expected – new crop vs. 0-25 K T. expected
Flat price corn matches its most recent high; $3.92 made this past Monday. What is different about today vs. Monday is that the corn market today was able to hold on to its intra-day gains. March corn gives us its best close dating back to early November. Today’s buying is thought to be short covering from the spec/fund sector. Trade chatter talks about the possibility of a bullish production report from the USDA on the 10th. The talk also mentions the potential for Chinese buying once the trade accord is officially signed; thought to be on Jan 15th. Last but not least is the idea that US corn exports will improve as SA winds down its export program as it is thought they have exhausted its old crop exportable supply.
Interior cash corn markets continue to show strength from mostly slow producer movement. The Gulf market too remains firm. I have to think the producer wants to see the USDA Jan 10th production report as well as the signing of the Chinese trade accord at mid-month. Bull spreads were working not only in the old crop but old crop was a noticeable gainer vs. the new crop. One word of caution here; Chgo ethanol prices area real dog vs. corn prices. I have to question just how long the ethanol processor is willing to pay up for corn given its poor ethanol margins.
I can’t imagine the corn market not having a firm bias going into the USDA report on Jan 10th. Just how firm remains to be seen. The mid-$3.90’s represents some good-looking congestive type of resistance. For you moving average fans March corn has now closed above or at its 100-day MA for the past 4 days of trading.
Daily Support & Resistance for Jan 3rd
March Corn: $3.87 – $3.95
July Corn: $3.99 ½ – $4.07 ½
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