Sept Corn closed 5 cents higher ($3.72 ¼), Dec 5 ¼ cents higher ($3.86 ½) & March 5 ¼ cents higher ($3.97)
August Chgo Ethanol closed 0.016 cents a gallon higher ($1.453), Sept 0.013 cents higher ($1.450)
Despite the USDA suggesting corn conditions ran unchanged last week at 72% GE it was hard to ignore that the majority of the 18 states within that report saw lower ratings. It appears that the ratings for Nebraska (#3 in acreage) and S. Dakota (#5 in acreage) carried the ball to sustain the unchanged national ratings. The suspect ratings along with surging soy and wheat prices had corn trading to levels not seen since mid-June. The bottom line is that the shorts are on the run. Since last Tuesday I have the funds buying nearly 55 k contract of corn.
River corn continues to be on the defensive with one exception, Savanna, IL. Their bid was up 7 cents but then again they had one of the poorest bids on the river. Processors still show the best bids out there but given the current rally in the flat price they are not reaching. The Gulf is mostly steady. The Sept/Dec spread remains wide while Dec forward spreads continue to inch narrower. The narrowing of the forward spreads continues to suggest the probability of better business down the road.
The next hurdle of resistance for Dec corn is now the mid-$3.90’s. The best looking near term support is $3.75. With the shorts on the run and the rest of the Ag complex surging higher I have to think that level will be challenged sooner vs. later. For what it is worth Dec corn is now on a 38 cent run from its July 12th low. Daily momentum indicators are beginning to flirt with overbought while the 14-day RSI says we are not even close to being overbought
Daily Support & Resistance for 08/01
Sept Corn: $3.66 – $3.78 ($3.82)
Dec Corn: $3.80 – $3.92 ($3.96)
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.