July Corn closed 1 ¾ cents higher ($4.54 ¾), Sept 3 ¼ cents higher ($4.61 ½) & Dec 5 cents higher ($4.68 ½)
July Chgo Ethanol closed $0.037 cents a gallon higher ($1.549) & August $0.037 cents a gallon higher ($1.554)
Weekly Corn Export Inspections – 653.8 K T. vs. 600-900 K T. expected
Weekly Corn Crop Progress & Conditions – Planted – 92% vs. 92% expected vs. 100% 5-year average – Emerged – 79% vs. 97% 5-year average – Condition – 59% GE (unch) vs. 59% expected vs. 78% year ago
New highs for the current rally were seen during the Sunday night session. The Monday day session brought us some minor profit taking due to the idea of a short term (intra-day & inter-day) overbought. Last week it was the bull spreads leading the corn market higher. Today saw the bull spreads retreating a bit and I think that may have prompted some of the flat price profit taking. It should be noted that during the run of profit taking only the old crop corn (July & Sept) traded lower on the day; new crop did not. The eastern Corn Belt continues to be a soggy mess while the western Corn Belt not so much. Near term forecasts continue to suggest the eastern Corn Belt will continue to be a soggy mess. Temps will continue to cooler than normal until sometime mid next week. Heat is extremely necessary to spur growth of the late planted. Some are trying to say that as we end the month of June and move into July warm and dryer conditions will develop. The latest from the NWS goes along with the warmer but not the dryer. As far as crop conditions are concerned the western corn seems to be “okay” for now while the eastern corn appears just too water-logged. I don’t know how to gauge planting progress due to the unknown around lost acres.
Interior cash corn markets continue to be strong as it seems the producer is just as bullish as the speculator. The Gulf market continues to edge higher as high water continues to inhibit product reaching the Gulf in a timely fashion. Export inspections favored the low end of guesstimates but then again this market is not about export demand. We are in a full blown supply scare market and the bull spreaders are end-users that are fearful of not having enough eastern Corn Belt corn to draw on once the marketing year starts. Granted the old crop carryout appears more than substantial but many are with the frame of mind it will be needed given the idea that this new crop year may feature a dramatically short corn crop.
Although the market finished higher I get the idea we may in for some short term consolidation/correction. I’m getting this feeling from the retreat on the bull spreads. I say short term as no one has a good handle on just how many acres have been lost and/or planted fields in the east that are drowned out. It’s too late to try and plant these drowned out fields. For what it is worth I have an objective of $4.69 for July corn and $4.83 for Dec corn. I’m not saying these will be the highs just some near term objectives for the current rally.
Daily Support & Resistance for 06/18
July Corn: $4.42 – $4.64 ($4.69)
Dec Corn: $4.56 – $4.78 ($4.83)
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