March Corn closed 5 ½ cents higher ($5.59 ¼), July 4 ¾ cents higher ($5.47 ¼) & Dec 7 cents higher ($4.76 ¾)
Weekly Ethanol Grind – 658 K bpd vs. 911 K week ago – Stocks – 22.8 M bbls vs. 24.3 M week ago
Weekly Corn Export Sales – old crop vs. 500 K – 1/300 M T. expected – new crop vs. 50-300 K T. expected
Old crop corn continues to flag higher as it follows the rest of the Ag sector. The weekly ethanol grind registers its biggest week-to-week drop but that was discounted in the trade as we were in the throes of a deep freeze last week. The grind for next week will be expected to rebound sharply. The idea is that going forward ethanol usage will improve as the economy opens back up as the other energy markets (crude, RBOB, heat) are advertising. New crop corn continues to move into new contract high ground as it fights for acres vs. new crop soybeans. The current price ratio of new crop corn to new crop soybeans stands at 2.59:1 which I believe favors additional acres to soybeans. Adding to the strength in the corn market is the idea that the ideal planting window for 2nd season corn in Brazil is slowly closing. Brazil says they will offset that with additional acres. Argentina would like to see additional amounts of water for their developing corn crop as many forecasters are leading towards a drier bias in the coming days.
Interior Midwestern cash corn markets are easing in many locations. This holds true for the Gulf as well. March gains on May as we approach 1st Notice day on Friday. May forward spreads are showing a bearish bias as we haven’t seen that much export interest and a lot of the spec focus has moved to the new crop.
Old crop corn has been flagging higher for the past two weeks but we have not yet come close to challenging the highs we saw on February 9th. Maybe it’s just me but I’m not impressed with this price action. What is impressive is the price action in new crop corn. A monthly Dec corn continuation charts suggested resistance as the $4.75 level. We have now eclipsed that level so we are now looking at something closer to the $5.00-$5.10 level.
Daily Support & Resistance – 02/25
May Corn : $5.50 – $5.62
Dec Corn: $4.70 – ???
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