Corn Commentary
Sept Corn closes 4 ¼ cents higher ($3.44 ¼), Dec 3¼ cents higher ($3.58 ½) and March 3 ¼ cents higher ($3.71)
Sept Chgo Ethanol closes 0.009 cents a gallon higher ($1.565), Oct 0.011 cents higher ($1.505)
USDA announces 143.6 K T. corn sold to Mexico
Weekly Corn Export Inspections – 797.5 K T. vs. 650-850 K T. expected
Weekly Corn Crop Ratings & Progress – 61% GE vs. 62% expected vs. 74% year ago – 60% Dented vs. 68% 5-year average – 12% Mature vs. 18% 5-year average
Corn futures scored an inside day of Friday. Short covering was the majority of the day’s trade prompted by some weather fears; possible frost in the north, northwest reaches of the Corn Belt over the next two mornings. There is talk that depending upon where Hurricane Irma hits late this weekend, early next week could impact some corn in the southeast. Adding to the firmer bias was a sharp rally in the soybean and soybean meal markets. A weaker US Dollar was also mentioned. For whatever the reason you want to latch onto to rationalize today’s rally it was all about the spec trade being just too short.
Interior cash corn bids are showing a mixed look today. Recent old crop movement has satisfied demand for the near term. Last week we saw old crop elevator stored corn move as most producers did want to pay additional storage charges. Once that was consummated movement has shut down. The producer has time to assess whether he wants to move some new crop or sit and wait. My Opinion; he’ll sit on his new crop until he sees minimally a 15-20 cent rally from current levels; something closer to $3.75-$3.80 Dec futures. Dec forward spreads ran unchanged all the way out Sept 2018.
The technical look is suggesting we have made lows for the time being. The trade appears to be taking their cue from the “key” reversal that was registered last Thursday. The first level of decent looking resistance is $3.70 followed by better looking resistance at $3.75 to $3.83. I don’t think the market will go straight up from here but rather advance in a grinding type motion. The mid-low $3.50’s should be viewed as near term support.
Daily Support & Resistance for 09/06
Dec Corn: $3.52 – $3.63
March Corn: $3.65 – $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.