Corn Commentary

storck

Corn – Just My Opinion

March Corn closed 11 ½ cents lower ($5.87 ½), July 10 ¼ cents lower ($5.87 ¾) & Dec ½ cent lower ($5.57 ¾)

Weekly Corn Export Sales – 457.7 K T. old crop vs. 500 K – 1.500 M T. expected – no new crop vs. 0-100 K T. expected

Weekly corn export sales rebound from last week’s dismal number but they are still not enough to spark any enthusiasm. The extreme hot & dry continues in areas of southern Brazil and Argentina but forecasts suggest relief is on the way as early as this weekend and into next week. Most feel these forecasted rains and cooler temps will stop the bleeding (yield loss) but undoubtedly damage has been down. The question is how much. Stories abound touting lower yields but actual losses won’t be known for a while. Despite the lower yield reports us corn futures move lower prompted by the forecasts for the weekend and next week. I’ve yet to see any forecaster tout that the anticipated rains and cooler temps will represent a trend change from the current hot & dry. The US Climate Prediction Center (CPC) stated this morning the current La Nina could remain in place through March-May (67% chance) and then move to neutral April-June (51% chance). It is the La Nina weather pattern that is causing the hot & dry in southern Brazil, Argentina and the dry winter here in the US.

Interior cash corn prices read mixed. Selected river locations involved with export read a bit easier. The midday posting at the gulf continues to read strong. Spreads within the old crop run a bit easier while old crop falls out of bed vs. the new crop. The collapse of the old crop/new crop spreads are reflective of the overall liquidation.

Tomorrow is Friday and we’ve traded the forecasted relief for the hot & dry areas of southern Brazil and Argentina. What do we do for an encore ahead of the 3-day weekend? If March corn is going to give us total technical failure we’re headed for the $5.50 level. Weekly corn chart suggests the bullishly inclined will not want to see a weekly close below the $5.76 level.

Daily Support & Resistance – 01/14

March Corn: $5.81 (?) – $5.96

July Corn: $5.82 – $5.97

The risk of trading futures and options can be be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.