Sept Corn closed 5 cents lower ($3.20), Dec 4 ½ cents lower ($3.30) & March 4 ¼ cents lower ($3.41 ¼)
August Chgo Ethanol closed $0.050 cents a gallon higher($1.200), Sept $0.040 higher ($1.190)
Flat price corn dives down to levels not seen since June 29th prompted by the 3% pts jump in crop conditions to 72% GE on a national level. I have to think this will have the trade thinking a national yield in the 181-182 bpa range (if not higher) for the USDA August 12th production report. If true the next question is how the USDA could offset this with demand. Given recent Chinese business (and the possibility for more) and a larger US animal herd some of this hike in supply could be easily offset. I’m not sure the USDA could justify a hike in ethanol usage. The bottom line is that the projected carryout will increase.
The interior Midwestern corn basis has a steady to mixed look. Cedar Rapids, IA has been bumping their basis higher for the past few days while interior river locations have been back off on their basis. The gulf eases a bit but still looking firm. Corn spreads continue to show a widening bias. It has been thought that once the producer feels he has had a successful pollination he will start moving his old crop. This appears to be the case. I’m also hearing that the Delta corn harvest has started in spots; not quite yet wide open.
Needless to say the flat price corn charts aren’t looking to spiffy. The only remaining technical support on the daily charts are the June lows: roughly $3.25 – $3.22 (Dec). Weekly charts based on the nearby Sept show a fair amount of room and momentum to move lower. In recent weeks the daily activity has been one to trade supply in the first half of the week and then try to rally for the last half of the week. I’m not wild about selling into today’s break but the rationale for ownership remains lacking.
Wishing and hoping has some sales’ announcements forth coming given the break we’ve had this week.
Daily Support & Resistance – 7/29
Sept Corn: $3.16 – $3.24
Dec Corn $3.26 – $3.34
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