Corn Commentary


Corn – Just My Opinion

May Corn closed 3 ¾ cents lower ($3.59), July 3 ¾ cents lower ($3.67 ¾) & Dec 3 ¼ cents lower ($3.87 ½)

May Chgo Ethanol closed $0.012 cents a gallon lower ($1.323) & June $0.011 cents lower ($1.335)

Updated short term forecasts are suggesting the western Midwest will see warming temps with a drier bias. These short term forecasts suggest the central and eastern Midwest will see the majority of moisture. Flat price wheat getting hammered also weighs on corn prices. Monday’s thought that we might be getting close to a trade deal with China was nowhere to be found on Tuesday. Now the question becomes just how short are the specs willing to get as they are record levels as we speak.

The interior corn basis continues to show a firmer trend. As the flat price goes lower it will be harder and harder for the elevator, processor and river stations to secure fresh sales of corn. The producer remains an unwilling seller. At this point in time I can’t imagine him selling anything new at least until his new crop has been planted and up out of the ground. The recent slide at the Gulf appears to have abated for the time being. Despite the firming of the interior basis the May/July corn spread run unchanged and old crop edges lower vs. the new crop.

Corn prices have moved into a 2 week old minor trading range. Since March 29th July corn has traded from $3.75 ¼ to $3.64. Dec corn trades similarly but within a slightly tighter range. Going forward its going to be all about planting conditions. There will be some small windows of opportunity over the near term. History tells us we have seen a number of slow starts to planting in the latter part of April into early May. Come the second week of May the trade will stand up and take notice if planting rates continue to be slow. Unless the near term forecasts for an active pattern fail to materialize I have to think flat price corn will hold in the recent aforementioned ranges.    

Daily Support & Resistance for 04/17

July Corn: $3.64 – $3.72    Dec Corn: $3.84 – $3.91  

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.