Corn Commentary


Corn – Just My Opinion

July Corn closed ¾  cent lower ($3.24 ¼), Sept 2 cents lower ($3.27) & Dec 3 cents lower ($3.33 ¾)

July Chgo Ethanol closed $0.034 cents a gallon higher ($1.274), August $0.036 lower ($1.164)

Weekly Ethanol Grind – 893 K bpd vs. 841 K bpd week ago – Stocks – 21.0 million bbls vs. 21.3 million week ago

Weekly Corn Export Sales – old crop vs. 300-800 K T. expected – new crop vs. 100-300 K T. expected

Horrible price action (higher early, lower late) despite the ethanol grind continuing to improve (with lower stocks) and a rumor that China may be looking for some US and/or Ukraine corn. The only redeeming fact to today’s trade was the improvement in the bull spreads led by the July which suggests a lack of deliveries on the 30th as well some credence to the Chinese rumor. Current weather conditions and forecasts continue to suggest a great start to this year’s corn crop. News wires’ estimates for Tuesday’s USDA Stocks and Acreage are starting to come out. The Bloomberg survey is suggesting corn acres could decline by 1.8 million acres from the March estimate but up 5.44 million vs. last year. The Quarterly Stocks estimate is suggesting 4.959 billion bu. vs. 5.202 billion one year ago.

The interior Midwestern corn basis remains steady to firm with the exception of an Illinois River location dropping out of the market. This is due to a series of lock and dam closures scheduled to begin in July. The gulf basis shows a noticeable jump at its afternoon posting suggesting the Chinese rumor might be something more than a rumor.  Bull spreads were working led by the July contract. I’m thinking this is tied to the idea we won’t see many if any corn deliveries against the July contract on Tuesday, the 30th as well as some possible export business with the Chinese.

As I mentioned earlier the price action is really bad. Tuesday’s efforts to try and reject its early in the day lows failed miserable today. The sideways to higher drift that started in early May is now advertising failure.

Daily Support & Resistance – 6/25

July Corn: $3.20 – $3.27  

Dec Corn $3.30- $3.36 1/2  

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