Dec Corn closed 2 cents lower ($3.68 ¼), March 2 cents lower ($3.80 ½) & July 1 ¾ cents lower ($3.94)
Nov Chgo Ethanol closes $0.009 cents a gallon higher ($1.277), Dec 0.006 cents higher ($1.293)
Weekly Ethanol Grind – 1.024 million bpd vs. 1.011 million last week – Stocks – 23.9 million bbls vs. 24.1 million last week
Weekly Corn Export Sales – old crop vs. 400-800 K T. expected – new crop vs. none expected
The idea of decent harvest progress this week, weakness elsewhere in the grain complex and a stronger US Dollar all worked together to keep the corn market under wraps on Wednesday. A weak export basis adds to the recent pessimism.
I’ve been gone for the past week and a half so I get a good flavor on the interior basis. What I’ve seen is that interior corn basis trades all over the place depending upon location. The Ohio River has seen a 2 cent improvement. The Chgo basis is 5 cents better. Processors are steady to better especially where harvest has come and gone (Decatur, IL is up 20 cents and Cedar Rapids up 16 cents). River bids continue to show a weak bias as does the Gulf. That suggests we have plenty corn available to meet the current export demand. Spreads have softened over the past week and a half; almost in step with the flat price.
The price action suggests the corn market is going nowhere fast. 15% volatility says that. Sure, earlier this month the USDA said are crop is not as great as originally thought but that rally failed to sustain itself. Long story short – it’s a trading range affair and I don’t think we’ve tested the low side of the trading range. As long as spreads are sagging I have to think the flat price will sag as well. As far as trading opportunities are concerned; watch the shorter term inter-day charts for short term extremes. Fading these short term extremes can create some decent short term trading opportunities.
Daily Support & Resistance for 10/25
Dec Corn: $3.65 – $3.72
March Corn: $3.77 – $3.84
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.