Sept Corn closed 9 cents higher ($3.40 ¾), Dec 9 ½ cents higher ($3.54 ½) & March 9 ¼ cents higher ($3.66 ¼)
Sept Chgo Ethanol closed $0.005 cents a gallon higher ($1.285), Oct $0.005 higher ($1.275)
USDA announces corn export sales – 408.0 K T. to China, 100.0 K T. to Japan
In a phone call on Monday between the trade representatives representing China and the US China reaffirms its commitment to the Phase One trade deal. On the heels of that phone call China buys 408.0 K T. of US corn. Couple this news with the lower than expected downgrade of the US corn crop yesterday afternoon prices gapped higher Monday evening and kept moving/grinding higher all day long. Given this week’s heat and dryness the trade is already talking about another downgrade to the crop next Monday.
The Midwestern cash corn market continues to give me a mixed look. The midday posting at the Gulf eases from last night but is still firm. Sept corn loses to the Dec ahead of Friday’s 1st Notice Day. Dec forward spreads were tightening with the flat price buying as well as from the idea the corn crop is shrinking along with the prospect of better export business.
Yesterday I talked about Dec corn now in line to challenge the $3.50 level. Well $3.50 came and went like a hot knife through butter. The July rally saw a cluster of closes from $3.52 to $3.56 – we’re there now. The July high for Dec corn was $3.63. The July rally stemmed from the acreage report showing less acres than originally thought. Have we lost some of those acres in Iowa due to the windstorm? Is the yield now back under the initial thought of 178.5 bpa? Given today’s price action I have to think the next level of resistance is $3.60 to $3.63. Last week’s intra-week correction measures to $3.56 ½.
Daily Support & Resistance – 8/26
Sept Corn: $3.36 – $3.46
Dec Corn: $3.50 – $3.60
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