July Corn closed 19 cents higher ($6.94 ½), Sept 1 cent higher ($5.59 ¼) & Dec 1 ¼ cents higher ($5.48 ½)
It looks like July corn is getting ready for zero deliveries and a friendly looking Quarterly Stocks report. Old crop corn already has an excellent export program and now it looks like it will last longer than originally thought due to the drought stricken 2nd season corn crop in Brazil now getting further damaged from frost. Couple this with a renewed ethanol program and it suggests old crop corn could stay extremely tight. If memory serves me correct in 2013 the July/Sept corn spread traded out to a $1.56 inverse.
New crop corn goes into a mini consolidation phase as it waits for tomorrow’s acreage update. Yes, the trade is expecting to see additional acres planted to corn but the wild card will be where these additional acres are coming from. If the lion’s share are coming from the Dakotas they will be discounted by the ongoing drought in that area. Forecasts are calling for hot & dry to rebuild in that area by mid to late next week.
Now we play the waiting game until 11:00 AM CDST tomorrow. One thing we can be sure of and that is the volatility will stay quite high no matter what the data suggests.
Daily Support & Resistance – 06/29
Sept Corn: $5.30 – $5.90
Dec Corn: $5.20 – $5.85
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.