Corn Commentary
Dec Corn closes ¾ cent lower ($3.38 ¼), March ½ cent higher ($3.51) and July ¼ cent higher ($3.67)
December Chgo Ethanol closes 0.003 cents a gallon higher ($1.408), Jan 0.003 higher ($1.398)
Weekly Ethanol Grind – 1.054 million bpd vs. 1.057 week ago – Stocks – 21.5 million bbls vs. 21.3 week ago
Weekly Corn Export Sales – 1.200-1.700 M T. old crop expected – 0-200 K T. new crop expected
It was a slow day for corn trading; barely a 2 cent daily range. It appears the trade has become a bit hesitant to press prices at current levels given the idea that the spec is now a record sized net short. Interior cash corn markets have been firming (spreads inching in). I believe that has calmed some of the selling for now. The weekly ethanol grind continues to be nothing short of robust. Overall domestic demand is no slouch. To get this market off of its can we need better exports and/or weather problems in SA. As of this writing I see no problems in Brazil while some want to talk up their positions by saying Argentina may be getting a bit dry. My “however” to the Argentine dryness story is that the forecasted dry spell is not expected to last very long. Currently it appears there are enough scattered rains around down there to keep the bulls at bay.
Interior cash corn markets continue with their recent steady to higher bias. While the Gulf market is not roaring higher it hangs tough. Corn spreads are inching in. Next week we’ll start talking about December corn delivery possibilities. As of this writing I don’t think they’ll be all that great as I’m showing a prominent central Illinois processor about to go “over” with his bid for corn.
Charts look ugly. Wednesday’s minor consolidation alleviated some of the recent inter-day oversold. I’m fully aware that over the past few days the managed money spec has probably amassed a record size net short position. I don’t blame him as what’s out there right now that says he is wrong? I’ll concede there is room for a retracement bounce back to the low side of the trading we broke down from last Thursday. As of this writing any attempt to rally will be technical in nature due to thoughts of too many shorts and/or oversold. Volatility levels have been coming down with the recent break. The lack of volatility suggests trading will remain slow for some time to come.
Daily Support & Resistance for 11/16
Dec Corn: $3.35 – $3.43
March Corn: $3.48 – $3.56
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.