Corn Commentary


Corn – Just My Opinion

May Corn closed 8 ¼ cents higher ($3.17 ½), July 7 ½ cents higher ($3.24 ¾) & Dec 4 ¾ cents higher ($3.36 ¾)

May Chgo Ethanol closed $0.027 cents a gallon higher ($0.910), June $0.027 cents higher ($0.941)

Weekly Ethanol Grind Production 563 K bpd vs. 570 K bpd previous week Stocks 27.7 million bbls vs. 27.5 million previous week

Weekly Corn Export Sales old crop vs. 600 K 1.100 M T. expected new crop vs. 50-300 K T. expected

Short covering was the MO for Wednesdays corn trade. A good portion of this was prompted from yesterday’s challenge of the 2016 low which held. News of note to prompt today’s run of short covering was the weekly ethanol grind not as dour as some had expected. The rebound in crude oil prices lent support as well. In addition Chinese rumors returned not only talking about corn purchases but also soy and cotton. Inter-market spreading was noted against US wheat futures. Talk is beginning to increase around the ongoing dry conditions for Brazil’s second season corn crop. Offsetting some of this friendly looking news are more reports of animal processing facilities shutting down the latest being Tyson in Waterloo, IA and Tyson in Logansport, IN.

The interior river basis continues to improve. Ethanol plants that are still operating are also showing a firming basis. The midday Gulf basis posting shows unchanged vs. the past few days. Bull spreads were working noticeably. How much of this is spec short covering vs. actual new demand remains to be seen.

Old crop has now bounced 18-19 cents, yesterday’s low to today’s high. I’m not sure much more is warranted as prices have rebounded into recently established technical resistance levels. New crop corn has rebounded about 15 cents in the same time frame and it too is now challenging recently established resistance levels.

Daily Support & Resistance 4/23

July Corn $3.19 – $3.29

Dec Corn $3.32 – $3.42

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.