Corn Commentary
March closes 6 ¼ cents lower ($3.63 ¼), July 5 ¾ cents lower ($3.77 ½) and Dec 5 cents lower ($3.91)
Feb Chgo Ethanol closes 3.1 cents a gallon higher ($1.461), March 2.6 cents lower ($1.489)
USDA announces 125 K T. old crop corn sold to Mexico
Informa suggests next year’s planted corn acreage will be 90.489 million acres vs. 94.004 last year
Flat price corn gives up the ship on Tuesday in regards to its current rally. New highs were made in the Monday night session and then failed rather hard during Tuesday’s day session. I did not see any particular news item to prompt the break. News wires will talk about US trade worries – personally I don’t think the man will fool with the grain trade. I know the recent weather play in SA has gone by the wayside for the time being. Ethanol margins are declining – ethanol prices have been in a general decline dating back to the 2nd week of December while corn prices have been sideways to higher in the same time frame.
The interior corn basis ran steady to better on Tuesday. Slightly better basis bids were noted at selected river locations. Processor bids ran unchanged vs. recent postings. The Gulf appears to be steady with its past two days’ postings. Corn spreads ran weaker within the current crop year as well against the new crop. I saw little reaction to the Informa new crop acreage ideas other than the bear spreads; old crop to new crop.
Flat price corn had been banging up against it 200 day MA the past couple of days. This average was violated during the Monday night session but failed to follow through during the day session. This failure prompted the additional selling as the day went on. The end result was a decent looking reversal for the recent rally – new highs, an outside day and closing below the previous day’s low. I would think this reversal type activity will be tough to overcome in the near term without some sort of news that has a bullish bias. The bottomline to the corn trade – the trading range affair lives on!!!!
Daily Support & Resistance for 01/25
March Corn: $3.60 – $3.68
July Corn: $3.74 – $3.82
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