Corn Commentary


Corn – Just My Opinion

July Corn closed 12 cents higher ($4.42), Sept 9 ½ cents higher ($4.47 ¾) & Dec 7 ¼ cents higher ($4.55 ¾)

July Chgo Ethanol closed $0.037 cents a gallon higher ($1.549) & August $0.037 cents a gallon higher ($1.554)

Weekly Corn Export Sales – 168.5 K T. old crop vs. 250-550 K T. expected – 94.1 K T. new crop vs. 100-300 K T. expected

USDA announces 175.0 K T. new crop corn sold to Mexico

Flat price corn continues to move higher led by the nearby July contract. Spreads led by the July contract literally exploded starting in the Wednesday night session. The best rationale for this, that I have heard, is that the southeastern feeder is worried that the eastern Corn Belt will be dramatically short new crop corn supplies due to the short corn acres as well as the call for renewed flooding in this area over the next couple of weeks. To cover himself against this happening he gets long the nearby contract and stands in for delivery. If all of this comes to fruition it sets the stage for a “delivery squeeze”.

Other than a couple of river locations that continue to be snarled by high water basis levels are higher. Fears that the eastern Corn Belt won’t have much of crop have just about all involved reaching for cash corn. Needless to say it’s the eastern locations that have the best bids. The Gulf continues to grind higher with its basis. Yes, the Gulf still sees slow originations due to high water upriver but now it has competition from the eastern Corn Belt as their end-users are running scared. It has been quite some time I have seen corn spreads this strong.

Weekly corn charts, based off of the nearby, are the highest they have been dating back to early July of 2014 when the market was moving lower. July (2019 contract) corn’s contract high is $4.45 made in late May of 2018. Its best close was $4.42 ¼ and tonight’s close is ¼ cent shy of that mark. A weekly Dec corn continuation chart is the highest it’s been since June of 2014. Dec corn finishes in new contract high ground with a new contract high close. All of the corn charts are fairly impressive looking following the near two weeks of consolidation. Using the simple “flip” method of charting July corn measures to $4.69 and December measures to $4.83.

Daily Support & Resistance for 06/14

July Corn: $4.30 – $4.45 (?)  

Dec Corn: $4.45 – $4.60 (?)

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