May Corn closed 4 ¾ cents lower ($3.41 ¼), July 4 ¼ cents lower ($3.47 ½) & Dec cents 4 ½ cents lower ($3.59 ¾)
April Chgo Ethanol closed $0.001 cents a gallon higher ($0.940), May $0.022 lower ($0.964)
Weekly Corn Export Inspections – 1.269 M T. vs. 700 K – 1,000 M T. expected (857.9 K T. last week)
Flat price corn stays under pressure from the continued sinking in the energy sector despite the good looking weekly export inspections. The price action is telling us that increased exports will not/cannot offset the loss of disappearance for ethanol usage. As each day goes by stories mount around the ethanol sector continuing to retract. Either plants are cutting back if not shutting down. Stories circulate that some plants that have recently shuttered are down for good, not to reopen. Adding to the bearish are fears ahead of the Quarterly Stocks report scheduled for release tomorrow morning. The fear is that it will come in larger than expected (8.125 billion bu. currently expected). Additionally the USDA will report Prospective Corn Plantings; expected at 94.328 million acres. Given the problems with ethanol many will say we don’t need that many acres planted to corn.
The interior corn basis is trying to stabilize after last week’s “beat down”.The Gulf basis, too, is stabilizing after its sell-off late last week. Corn spreads continue to show a widening bias in the old crop (additional carry within the price structure) and now new crop spreads are showing the same tendency.
July corn has two short term support levels to look at: $3.44 and the contract low at $3.38. The spec trade is already a healthy short so it will be interesting to see just how much more they can beat on this market. If the USDA shows us bullish surprises we’ll look at $3.60 followed by $3.70. As far as I’m concerned the only long left in the market are the commercials and the farmer.
Daily Support & Resistance – 3/31
July Corn – $3.38 – $3.60
Dec Corn – $3.55 (?) – $3.71
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