Dec Corn closed 1 ¾ cents lower ($3.72 ½), March ¾ cent lower ($3.84 ¾) & July 1 cent lower ($3.97 ½)
October Chgo Ethanol closes $0.009 cents a gallon higher ($1.444) & Nov $0.006 cents lower ($1.385)
Weekly Corn Export Sales – 494.0 K T. old crop vs. 600 K – 1.100 M T. expected – no new crop vs. none expected
Weekly export sales continue to disappoint. The current pace of sales is lagging last year’s rate by 9.1 M T. Originations out of SA continues to dominate the global export market as prices out of both Brazil and Argentina undercut US offering prices. If the US Dollar continues to strengthen US corn exports will continue to suffer until SA runs out. The corn crops from SA this past season were quite large so it could be sometime before the US regains market share. The biggest feature that I saw on the day was some stop loss selling when Dec traded below $3.70 but prices were able to recover to just minor losses on the day. The next number of days is going to be rather wet for central, west central areas of the Midwest. Frost talk for the US Northern Plains next week appears to be diminishing. Overall the unknown around yield and harvested acres continues to lend support. In summation; many in the trade would like to believe the corn crop is not as big as recently alluded to by the USDA but the lack of demand is an offsetting issue for now.
Not much change is being seen in the day-to-day changes with the interior corn basis. Processors still show the best basis. The interior river basis fluctuates back and forth based on who needs corn vs. those who don’t need it. The low looking Gulf basis acts as a reminder of just how poor export demand is currently running. Corn spreads show a widening bias. It was just the other day the Dec/March corn spread traded 10 ¾ cents; today it traded out to 12 ½ cents.
The flat price action of late suggests the corn market has moved into a “waiting” mode. It’s basically waiting for something to come along to move us in one directions of the other. As of this writing the lack of demand is resistance while the unknown around supply is support. I’m not sure this is going to change in the near term. The Stocks report on Monday will act as a reminder we have a large carryin that will work to offset some of the ideas of lower production.
Daily Support & Resistance for 09/27
Dec Corn: $3.69 – $3.76
March Corn: $3.81 – $3.88
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