July Corn closed 13 ½ cents higher ($4.47 ¾), Sept 9 ¼ cents higher ($4.44 ¼) & Dec 8 ½ cents higher ($4.48)
August Chgo Ethanol closed $0.044 cents a gallon higher ($1.549) & Sept $0.044 cents higher ($1.557)
Weekly Corn Export Sales – 505.4 K T. old crop vs. 150-400 K T. expected – -108.4 K T. new crop vs. 100-300 K T. expected
On “the surface” there was nothing friendly to the corn supply-demand balance sheets (see attached S&D tables). Since no one believes the acreage numbers coupled with possibility of a weather market developing the initial break was very well received. Within moments after the report was released Dec corn was down 8 cents; just minutes later prices traded unchanged to higher on the day and that higher trend stayed with us right to the end of the day. Some weather forecasters are hinting at the possibility of a “hot & dry” scenario developing as we move further into the month of July. Earlier in the week it was thought that the developing tropical storm in the Gulf may bring needed to moisture to the Corn Belt. The latest guidance systems are now suggesting the storm track will move further east and stay south of the Corn Belt. Support was also garnered from a surging wheat market.
Interior cash corn markets continue to be quite strong led by the eastern Corn Belt locations. Producer selling remains non-existent. Producers won’t sell until they have a better handle on their new crop. The Gulf too has a firm tone due to slow origination as well as fears from the developing tropical storm that could hamper loading. Needless to say corn spreads continue to show a firming bias all the way out to the 2020/21 crop year.
Dec corn flat price now appears ready to challenge its resistance in the mid $4.50’s. How/when we plow through that resistance will depend on how forecasts develop as we move further through the month of July. The recent corrective mode has alleviated any thoughts of overbought which in turn opens the door for higher prices.
Daily Support & Resistance for 07/12
Sept Corn: $4.38 – $4.58
Dec Corn: $4.42 – $4.62
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.