Dec Corn closed 4 ¾ cents lower ($3.87 ¾), March 4 ¾ cents lower ($3.99 ¾) & July 4 ½ cents lower ($4.07 ¼)
October Chgo Ethanol closes $0.013 cents a gallon lower ($1.485) & Nov $0.028 cents lower ($1.420)
Weekly Ethanol Grind – 958 K bpd vs. 943 K bpd last week – Stocks – 23.4 million bbls vs. 22.5 million bbls last week
Weekly Corn Export Sales – old crop vs. 400-800 K T. expected – new crop vs. none expected
For the time being we’re going to call Wednesday’s price action as a technical correction in lieu of the sharp run-up stemming from Monday’s bullishly construed quarterly Stocks’ report. As we move towards next Wednesday’s crop production and supply-demand update the trade will incorporate the lower carryin vs. the possibility of a slightly higher production figure. Private estimates, so far, are suggesting a slight rise in production. On the weather front; it’s excessively wet right now in parts of the Corn Belt; west central, west and north. Forecasts for next week and into mid-month are suggesting a drier bias which should help spark harvest where the crop is ready. Demand or lack thereof continues to nag at the market suggesting the potential for much higher prices may not develop unless SA has problems during its growing season. Argentina has already suggested lower corn acres in response to its economic woes.
With the exception of Linden, IN all other interior corn basis locations are showing a steady to easier bias. Where harvest is getting close basis levels are easier. Corn processers still show the best bids but many are showing an easier bias. The latest weekly ethanol grind did show a slight rebound from the previous week’s low numbers but stocks rebounded even more. Corn spreads ran steady to easier within the current crop year and gave back minor amounts of what they gained during the Monday-Tuesday rally. I do find it interesting the nearby corn spread could not hold its gains from Monday’s rally – is it that harvest is looming and demand is less than desirable?
Dec corn fills its August 12th-13th gap exactly and turns back down. Ideas of better harvesting conditions developing next week and beyond coupled with less than desirable exports has the recent buyers thinking twice as to just how much higher can prices go over the near term. It’s easy to say any challenge of the low $4.00’s will attract some cash related selling. As of this writing I wouldn’t be surprised to see some further backing and filling of the Monday, Tuesday rally.
Daily Support & Resistance for 10/03
Dec Corn: $3.83 – $3.93
March Corn: $3.95 – $4.05
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