Corn Commentary
May Corn closes 2 ½ cents lower ($3.58 ¾), July 2 ¼ cents lower ($3.66 ½) and Dec 2 ½ cents lower ($3.82)
April Chgo Ethanol closes 1.5 cents a gallon higher ($1.537), May 1.3 cents lower ($1.556)
Ethanol Stats for Week Ending 3/17 – 1.044 million bpd vs. 1.045 last week – Stocks – 22.6 million bbls vs. 22.8 last week
Weekly corn Export Sales – old crop vs. 900 K – 1.200 M T. expected – new crop vs. 100-300 K T. expected
The short term bias for flat price corn continues to be lower as we grind into new lows. New low closes, for the current sell-off. New overnight news continues to be slight. The weekly ethanol data looked solid to me but was barely noticed when released. Adding to the plight of the corn market is the fact that other feed stuffs (wheat and soybean meal) are moving lower as well. I have yet to see a consensus of estimates for next week’s Quarterly Stocks report but so far the market action is suggesting a big number. The idea of lower corn acres on the Prospective Plantings report is falling on deaf ears – the rationale on that is the SA crop looks more than sufficiently large.
Interior cash corn markets don’t do a whole lot despite the lack of any fresh producer sales. Gulf values have been grinding easier since last Thursday. This is not a very positive scenario – a stagnant domestic market, easier export values and lower futures to boot. Corn spreads on the day ran fractionally mixed while staying relatively wide.
July corn is now at levels not seen since early January. New crop corn is not far behind. We can talk about short term inter-day technical data flirting with oversold but daily technical data is not. I find it interesting the decline in the US dollar has done little in offering support. We have a big report coming out one week from this coming Friday. I fully expect to see some stabilization, short covering ahead of this report but as of this writing it looks like it is going to come later vs. sooner. Tomorrow is export sales day – we’ll see if they can offer any support. Maybe I’m out in left field but I’d be a bit leery of selling current levels. What can rally the market in the very short term – how about better ethanol margins.
Daily Support & Resistance for 03/23
July Corn: $3.65 – $3.72
Dec Corn: $3.80 – $3.87
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