March Corn closed 1 ½ cents lower ($3.80 ¾), July 1 ½ cents lower ($3.91) & Dec ¼ cent lower ($3.92 ½)
February Chgo Ethanol expired unchanged ($1.353), March closed $0.015 cents a gallon lower ($1.352)
Weekly Ethanol Grind – 1.081 million bpd vs. 1.029 previous week – Stocks – 23.5 million bbls vs. 24.2 million previous week
Weekly Corn Export Sales – old crop vs. 600 K – 1/300 M T. expected – new crop vs. 100-150 K T. expected
What new news I saw today that would impact the US corn was not friendly. China has announced they would start their state reserve corn auctions early this year due to the ongoing transportation issues resulting from the coronavirus. A relatively prominent analytic firm here the US that was one of the first to use satellite technology is suggesting this year’s planted corn acreage could be as large as 95.7 million acres. The other day one of the US trade advisers said China’s implementation of the Phase One agreement may get off to a slow start due to ramifications stemming from the coronavirus. Countering that statement was word out of Ukraine stating they have not run into any issues delivering corn to China because of the coronavirus. The bottom line to all of the aforementioned is (in my opinion) the US corn market will do well for itself just to maintain the current interim sideways trend. The strong looking weekly ethanol grind did absolutely nothing for the corn market today.
The interior corn basis continues to hold firm. Producer selling remains minimal. The Gulf market is holding steady vs. values we saw mid last week. Corn spreads within the current crop year ran steady to fractionally better. It was hard not to notice the old crop losing to the new crop.
For the near term flat price corn continues to be a trading range affair. I’m starting think the longer this lasts the greater the odds of this market breaking down. As of this writing we are supposed to have the best prices (cheapest) corn prices in the World. Unfortunately the recent strength in the US Dollar has to be viewed as a partial offsetting issue. Tomorrow is export sales day. The past two weeks we’ve seen decent looking sales numbers – will that continue? The steady to nothing export basis suggests maybe not.
Daily Support & Resistance – 2/06
March Corn – $3.76 – $3.84
July Corn – $3.876 – $3.94
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.