March closes 1 cent higher ($3.58 ¼), July¾ cent higher ($3.71 ¾) and Dec ¼ cent higher ($3.86)
Feb Chgo Ethanol closes 1.7 cents a gallon lower ($1.475), March 1.4 cents lower ($1.497)
Weekly Corn Export Sales – 603.3 K T. old crop vs. 500-800 K T. expected – 151.7 K T. new crop vs. 0-50 K T. expected
USDA announces 253.5 K T. old crop corn sold to unknown; 110.0 K T. old crop corn sold to Japan
Here’s the long and short of the USDA corn reports – it was basically a neutral reaction. See the attached tables within the email for “actuals vs. estimates” as well as the Supply-Demand update. Because the corn report was deemed as mostly neutral it took the brunt of inter-market spreading against long soybeans and long wheat. US Production came in lower than expected. The projected US carryout came in lower than expected and the World projected carryout came in lower than expected. The kicker here is that the Quarterly Corn Stocks came in higher than expected. That’s about demand and the US demand tables show total US usage declining. This one item is my rationale as to why the corn market gave us such a sluggish performance vs. the wheat and soybean markets. Going forward focus should now move to the growing conditions of the Argentine crop as well as the 2nd season Brazilian corn crop.
What changes that are being seen in the interior corn cash markets are higher. 3 of the 11 locations that I track are reporting higher basis levels; 2 of these 3 are river locations. The gulf reports 2 cent increases in its bid. March corn gained a fraction within the crop year; old crop gains on new crop.
The technical look still suggests the corn market is still a broad trading range affair. Reading between the lines the short term bias remains for higher prices; at least a challenge of recent highs. If the soybean and wheat markets continue to move higher corn prices will tag along for the ride but to a much lesser extent. Given the beating the corn market took on the inter-market spreads on Thursday some re-alignment on Friday should not be a surprise.
Daily Support & Resistance for 01/13
March Corn: $3.52 – $3.63
July Corn: $3.66 – $3.76
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.