Sept Corn closed ¼ cent higher ($3.11 ¼), Dec ½ cent higher ($3.23 ¾) & March unchanged ($3.35 ½)
Sept Chgo Ethanol closed $0.055 cents a gallon higher ($1.160), Oct $0.055 higher ($1.159)
Weekly Corn Export Sales – 101.5 K T. old crop vs. 100-600 K T. expected – 2.599 M T. new crop vs. 2.000-2.600 M T. expected
I’m told that new crop corn sales on the books are at a record high for this time of year; almost 20% of the projected sales total. And here we sit. Over the next few days leading up to the 12th the trade will mull over the probability of a higher supply and whether or not the USDA can hike demand enough to offset. This I believe could lead to some modest short covering over the near term. Don’t hold your breath for anything major on my for some short covering as the mid-low $3.30’s represents some decent looking resistance. If the demand side of the equation is indeed hiked I have to think the majority will come from the export sector as its doubtful we see an increase in ethanol usage. Feed demand should stay relatively steady.
The interior Midwestern corn basis continues to show a soft tone as does the Gulf. Sept corn continues to lose to the Dec as it appears there is some old crop corn moving or anticipated to be moving rather soon. The Dec forward spreads did show some fractional tightening reflecting the idea of a good export program for the first quarter of the new marketing year.
As I said earlier – so here we sit. Short term inter-day charts suggest minor resistance begins at $3.26-$3.28 (Dec). After that it’s the mid-low $3.30’s. Weather forecasts continue to show nothing real threatening to crop development. For what it’s worth the latest Drought Monitor map shows the dryness in west central Iowa trending to the extreme. This item may limit selling but not inspiring buying.
Daily Support & Resistance – 8/07
Sept Corn: $3.07 ½ – $3.14 ½
Dec Corn: $3.20 – $3.27
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