March Corn closed 2 ½ cents lower ($3.63 ¾), July 2 ¼ cents lower ($3.82 ¼) & Dec 1 ¾ cents lower ($3.94 ½)
March Chgo Ethanol closed $0.002 cents a gallon higher ($1.339) & April $0.003 cents lower ($1.354)
Weekly Ethanol Grind – 1.028 million bpd vs. 996 K previous week – Stocks – 23.7 million bbls vs. 23.9 million previous week
Weekly Corn Export Sales – old crop vs. 700 K – 1.200 M T. expected – new crop vs. 0-100 K T. expected
Speculative based selling continues!! Call it 1st Notice Day fears. Call it month end!! Call it remarks from the USTR suggesting China is not going to buy their way into a trade deal!! Call it a lack of announced export sales!! Call it what you want but the fact remains the spec side of the trade is amassing a fair sized short position. Just in the last three days the daily fund tracker shows 66 K contracts of corn sold. Since the last CFTC report (Feb 12th) funds have sold nearly 79 K contracts. From Monday’s high to today’s low may corn has broken 15 cents. Most old crop corn spreads are in new low ground. The July/Dec corn spread traded within 1 cent of its contract lows. Needless to say that after today’s action the corn market is looking pretty grim. Can the delivery make-up turn things around? Can a new month on Friday turn things around? Weekly export sales are out in the morning and they will be current with last Thursday. China says they are still looking at corn offers.
Corn processors continue to reach for corn; from the eastern Midwest to the western Midwest. Interior river bids appear to be steady to easier. The Gulf is firm but easing from the highs seen over the past couple of days. Corn spreads have the look of a sewer shot. How much of that is 1st Notice Day fears remains to be seen. Trade speculation is suggesting 400-800 March corn deliveries. One source suggests little to none. Coming into today there were 1186 contracts registered for delivery. 4:00 PM today is the cut-off for any changes.
It’s easy to say the spring rally can start any day now given the depressed look of the market. What’s out there to prompt it remains to be seen. Will it be export announcements? Will it be planting condition worries? Will it be the trade just got too short? Prices are yet to challenge the “make it or break it” support levels. The mid-$3.60’s is that level for May corn, the mid to low $3.70’s for July corn and the mid-$3.80’s for December corn. So far there is nothing in the price action that suggests we are not headed for those levels.
Daily Support & Resistance for 02/28
July Corn: $3.80 ($3.75) – $3.87 Dec Corn: $3.91 ($3.88) – $3.99
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