Corn Commentary


Corn – Just My Opinion

July Corn closed 25 ½ cents higher ($7.20), Sept 40 cents higher ($5.99 ¼) & Dec 40 cents higher ($5.88 ½)

Weekly Ethanol Grind – 1.058 M bpd vs. 1.048 M week ago – Stocks – 21.6 M bbls vs. 21.1 M week ago

Weekly Corn Export Sales – old crop vs. -100 +400 K T. expected – new crop vs. 150-650 K T. expected

USDA Quarterly Corn Stocks – 4.112 B bu. vs. 4.144 B expected

USDA Corn Acreage Update – 92.692 M vs. 93.787 M expected vs. 91.144 M in March

There was nothing bearish about the quarterly corn stocks report it just wasn’t as bullish as the acreage report. Given the ongoing export program and the renewed demand for ethanol old crop corn is not going to go away silently. The drought stricken 2nd season corn crop in Brazil, now getting heavily frosted, should add to the US export program going forward. As far as the corn acreage report is concerned it suggests to me we are going to have higher prices for some time to come. The World is going to have to used to high priced US corn and they won’t have the 2nd season Brazilian corn crop to fall back on.  Acres increased by 1.548 M from the March figure. What’s important here is that 1.200 M of that increase came from the Dakotas and Minnesota; some of the worst condition corn we have currently growing out there. The USDA is suggesting we will have 84.5 M harvested corn acres. Given what’s going on in the aforementioned areas that figure should come down as we move forward.

Now that we have set the acres and the old crop stocks nearly 100% of the trade’s focus will now be about the weather and its impact on the developing corn crop. The latest 6-10 day and 8-14 day from the NWS suggests the Dakotas staying warm and dry, Minnesota & Iowa staying warm while mixed as to moisture and Illinois east warm and wet.

Daily Support & Resistance – 07/01

Sept Corn: $5.90 – $6.30  

Dec Corn: $5.80 – $6.10

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.