Corn Commentary
July Corn closes 16 cents lower ($3.76 ¼), Sept 16 ¼ cents lower ($3.85 ½) and Dec 15 ½ cents lower ($3.98 ¾)
August Chgo Ethanol closes 0.008 cents a gallon lower ($1.561), Sept 0.010 cents lower ($1.562)
The trade was expecting to see modest increases in US ending stocks for both old crop and new crop – what they got was healthy increases. The trade was looking for modest increases in World ending stocks – what they got were more than healthy increases (see the attached July Supply-Demand for net changes). The trade tried to reject the initial break from the report (rallied 7 cents) but it was unsuccessful as prices broke down to new lows for the day. The inability to sustain the rejection attempt, I think, is due to the recent short term weather. Over the past few days we have seen some scattered rains move through some areas that have been of concern. Yes, it’s still supposed to get hot next week but we have been trying to trade that forecast for the past 6 days. With all of this said we now get to spend the next 30 days hemming and hawing about where corn pollination has been successful vs. areas where it wasn’t.
Most interior cash corn markets remain on the defensive and this holds true for the Gulf as well. Movement, I’m told, has been fairly heavy over the past couple of days. Spreads were soft all the way out to Dec 2019.
The other day I talked about whether the charts were making a top or just the pause that refreshes. After Wednesday’s price action suggests we may have seen our highs for the near term. We have to remember that a good portion of the trading funds base their ideas on price action and after Wednesday’s performance the price action leaves a lot to be desired.
Daily Support & Resistance for 07/13
Sept Corn: $3.78 – $3.94
Dec Corn: $3.90 – $4.07
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.