Corn Commentary

storck

Just My Opinion

Dec closes 3 cents lower ($3.38 ½), March 2 ¾ cents lower ($3.46 ½) and July 3 ¼ cents lower ($3.60 ¼)
December Chgo Ethanol closes 1.1 cents a gallon lower (1.520), Jan 1.1 cents lower (1.459)
Weekly Ethanol Grind – 1.017 million bpd vs. 1.002 last week – Stocks – 18.6 million bbls vs. 19.2 last week
Weekly Corn Export Sales – old crop vs. 900 K – 1.200 M T. expected – new crop vs. none expected
Spinning wheels go round and round – down on Monday, up on Tuesday and down on Wednesday – the end result is a big nothing. Then again with volatility between 17% and 18% not much is expected to happen. These levels of volatility suggest a lack of uncertainty. When there is a lack of uncertainty markets go nowhere fast if not lower. If we are to see anything sustained on the upside it will have to come out of SA weather worries. Without something like that we will be stuck dealing with the imbalance of too much supply vs. not enough demand.
The majority of interior corn basis locations continue to show a tightening bias. There is always an exception – in this case Cedar Rapids broke their basis 6 cents today. The gulf market appears stable against recent lows. Corn spreads ran mixed on the day with only fractional changes.
The technical look hasn’t really changed. The daily trend is still lower but the rate of descent has slowed. We can still see lower prices but they will come in a grinding type fashion. The low implied volatility suggests an emphasis on the “grinding” description of the trade. I will admit that after Tuesday’s attempt at a reversal Wednesday’s trade was very disappointing. Tomorrow is Thursday and that means weekly export sales – whatever they come in at and whatever the outside markets are doing will dictate the trade direction.
Daily Support & Resistance Dec Corn: $3.36 – $3.44

 

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