Sept Corn closed 5 ½ cents lower ($4.18 ½), Dec 3 ¼ cents lower ($4.27 ½) & March 2 ½ cents lower ($4.37 ¼)
August Chgo Ethanol closed $0.010 cents a gallon lower ($1.492) & Sept $0.013 cents lower ($1.490)
Weekly Corn Export Sales – 121.2 K T. old crop vs. 150-400 K T. expected – 386.6 K T. new crop vs. 100-300 K T. expected
The corn market saw a fair amount of “push/pull” factors early Thursday before succumbing to the downside. Weekly old crop corn sales were nothing to write home about then no one was looking for much given how SA has taken over the role of the major world corn supplier. New crop corn sales were a bit better vs. expectations but still lagging last year’s pace by 2.4 M T. The nearby Sept/Dec corn spread continues to sag suggesting better farmer selling. Higher wheat prices tried to lend support but this was offset by lower soybean/soybean meal prices. The bulls still tout dramatically lower acres while the bears tout the lack of demand. Dry areas in the Corn Belt are minimal. Recent moderate temps aid what corn is going through pollination. Forecasts for the time being do not look threatening.
Processor bids are starting to slip. As of this writing only the Ohio River basis is holding its head up. Illinois River basis ran unchanged on the day. The nearby corn spread, Sept/Dec, has taken a beating the last two days. On Tuesday this spread was quoted at a 4 ½ cent carry; today it traded out to a 9 ¼ cent carry. Dec forward spreads also showed a bearish bias. Traders that got long the year-to-year spreads (2019-20 vs. 2020-21) are also taking their lumps. For whatever he reason unbeknownst to me the Gulf basis holds on to its recent strength.
Fund liquidation continues to be the name of the game. It now looks like $4.20 here we come. I can’t justify selling current levels due to short term technical considerations but I get the impression we are going to flush any longs that got into the market after May 24th.
Daily Support & Resistance for 07/26
Sept Corn: $4.13 (?) – $4.26
Dec Corn: $4.24 ($4.20) – $4.35
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.