May Corn closed 1 ¼ cents lower ($3.33 ½), July ¼ cent lower ($3.38 ½) & Dec cents 2 ½ cents higher ($3.49 ¾)
April Chgo Ethanol closed $0.025 cents a gallon higher ($0.845), May $0.029 higher ($0.865)
Weekly Corn Export Sales – 1.075 M T. old crop vs. 700 K – 1.200 M T. expected – 20.3 K T. new crop vs. 0-100 K T. expected
The misery continues!! Old crop corn spikes higher with the sharp rally in crude oil only to finish at its low end of the day. At one point old crop corn was 7-8 cents higher. If I had to guess there is a wall of cash related selling sitting just over the market. Adding to the misery bear spreads were working despite the idea US corn is probably the cheapest on the global export market. Algeria bought a load of US corn for the first time in two years. The bear spreading is just another indication of the dour situation as it puts additional amounts of carry into the price structure.
The interior corn processor basis continues to be on the defensive. River locations involved with export are showing steady to better basis levels. The midday posting at the Gulf suggests it is holding on to its recent strength. Despite what appears to be better export potential bear spreads still work.
It was not a warm and fuzzy performance today especially since old crop corn at one point was 7-9 cents higher only to finish marginally lower. As long as the “stay at home” order is upheld travel will remain diminished and that means processing for ethanol will stay depressed. Even though export prospects appear to be improving export disappearance only accounts for about 11% of total usage while processing for ethanol accounts for 34% of total usage. Downside targets for old crop corn (the nearby) is still the mid-high $3.20’s.
Daily Support & Resistance – 4/03
July Corn – $3.35 – $3.45
Dec Corn – $3.45 – $3.55
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.