Corn Commentary
Dec Corn closes cents higher ($3.49), March 3 ¼ cents higher ($3.62 ¾) and July 3 ½ cents higher ($3.79 ¼)
November Chgo Ethanol closes 0.001 cents a gallon higher ($1.426), Dec 0.001 cents higher ($1.413)
USDA announces 120.0 K T. of corn sold to Mexico
Weekly Corn Export Sales – old crop vs. 800 K – 1.100 M T. expected – new crop vs. none expected
Personally I did not see anything friendly from the USDA as to US corn production and its respective demand outlook (see USDA October attachment) yet the market rallied anyway. I think it came from the spec sector being too short as well as the sharp strength in the soybean/soybean meal market. World ending stocks, lower than expected, opens the door for yet lower ending stocks as we move forward. Brazil’s start to the growing season is a bit shaky right now as some will say its too wet in the southeast and too dry in the center west. Granted it’s early but if the pattern continues it opens the door for lower Brazilian production. Earlier today there was a blurb out of China suggesting their crop size is closer to 210.0 M T. not the 215.0 the USDA is stating. The bottomline – the trade was too short coming into this report and the door has been opened for possible lower World production.
Corn processor bids remain fully steady. River bids continue to recover. The Gulf market is mostly steady. Bear spreads continue to work within the old crop while bull spreads are working old crop to new crop.
Flat price corn registers some smart looking upside reversals on Thursday. We saw an outside day with higher closes. I can’t call Dec corn a key reversal as we closed at Wednesday’s high. March corn did register a key reversal as it did close above Wednesday’s high and it did register a new contract low. May forward are considered simple reversals as they did not register new contract lows but they were outside days closing above the previous day’s highs. These reversals should be good enough to stop the bleeding for the near term.
Daily Support & Resistance for 10/13
Dec Corn: $3.45 ½ – $3.56
March Corn: $3.59 – $3.69
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