July Corn closed 11 cents lower ($6.53 ¼), Sept 1 ¾ cents lower ($5.49 ¼) & Dec ¼ cent higher ($5.36)
Weekly Corn Export Sales – 216.3 K T. old crop vs. 0-400 K T. expected – 310.8 K T. new crop vs. 200-500 K T. expected
The rain event we’ve all been waiting for began last night in eastern Nebraska and has been traversing across Iowa this past morning. This rain event will be in the central areas of the Corn Belt for the next few days. Weekly export sales, I thought, were no big deal as they were pretty much mid-range of expectations. IGC did announce an increase in global corn production; 1.201 B T. vs. last month’s USDA at 1.189 B T. Included in the increase IGC raised China production to 272.8 M T. vs. the most recent USDA at 268.0 M T. The reaction to all of this had Dec corn diving to levels not seen since May 26th when the interim low was established at $5.00 ¼. Today’s low was $5.14 ¼. Within 15-20 minutes of that low being made the market had already bounced 10 cents. The bounce continued all the way up to $5.41 ¾. All in all it looked like a classic case of “sell the rumor / buy the fact”. In this case the “rumor” was the rainfall
Today’s price action in the December is trying to suggest we may have gone low enough for now given everything we know. We have factored in the next few days of rainfall getting into Iowa and points east. I think forecasts still have the Dakotas coming up short from this event. On June 30th we are expecting to some sort of increase in planted acres. I have yet to see any of the survey results but I’m thinking most thoughts are in the range of 2.5 to 3.5 million additional acres planted to corn. So with all of this said I would like to think we will settle into a minor trading range affair between $5.20 and $5.60 between now and the 30th.
Daily Support & Resistance – 06/25
July Corn: $6.40 – $6.70
Dec Corn: $5.20 – $5.60
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