July Corn closed ¾ cent lower ($3.29 ¼), Sept ¾ cent lower ($3.33 ¾) & Dec 1 ½ cents lower ($3.41 ½)
July Chgo Ethanol closed $0.038 cents a gallon lower ($1.160), August $0.018 lower ($1.140)
Weekly Corn Export Inspections – 910.5 K T. vs. 950 K – 1.250 M T. expected
USDA rates US corn condition at 71% GE (-4%) vs. 75% expected vs. 59% year ago
The “macro” economic markets had a fair amount of influence on today’s intra-day trade direction. In the early going these outside markets were sharply lower and as the day went on they moved sharply higher. This was pretty much the price action we saw in the grain markets but to a much lesser extent. To start the day good crop conditions were discussed with stress being seen by mid-week and then relief by week’s end. Corn export inspections were decent looking but below expectations. The sharply lower US Dollar further enhances the idea that US origination for corn exports is the best deal out there.
Interior cash corn (basis) markets in the Midwest ran mixed on the day. Cedar Rapids, IA was 2 cents better, Savanna, IL 2 cents easier and Linden, IN 3 cents better. The midday posting for the Gulf was unchanged with late Friday’s but it should be noted that Friday’s late posting was 3-4 cents lower vs. Thursday. The July/Dec corn spread showed a bullish bias by 3/4’s of a cent while the Dec/May lost fractionally.
Despite the minor losses on the day flat price corn, both old crop and new crop, continue to trade within the near 2 month old sideways to higher channel. As of this writing we have two major opposing forces at work here – a near record short speculative position vs. a good looking crop with a non- threatening weather outlook. At the end of the month the USDA will update acres. The thought today is that corn acreage will decline by nearly 2 million acres and the quarterly stocks report will confirm a more than ample old crop corn situation. The bottom line to all of this is that in the near term the corn market goes nowhere fast.
Daily Support & Resistance – 6/16
July Corn: $3.26 – $3.35
Dec Corn $3.39 – $3.46
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.