Corn Commentary
March closes ¼ cent lower ($3.69 ½), July¼ cent higher ($3.83 ¼) and Dec ¼ cent higher ($3.96)
Feb Chgo Ethanol closes 0.2 cents a gallon higher ($1.492), March 0.3 cents lower ($1.515)
Weekly Corn Export Inspections – 963.8 K T. vs. 800 K – 1.000 M T. expected
Flat price corn stands in at its recent upper end. During the day on Monday the flat price tried to sell-off a couple of times only to come right back. Support is being garnered from the lower US Dollar (even though US corn is the market to the world right now) and spec shorts continuing to cover. Weekly corn export inspections were deemed solid vs. expectations. Going forward I anticipate an extremely healthy export shipment program. Adding additional support to the flat price is the notion that we need a bit of a weather premium as Brazil moves into planting its 2nd season corn crop. The weather scenario for Argentina has been taken off of the forefront for now but given how extreme the early part of the season has been its understandable the need for additional weather premium.
Interior corn basis levels if not steady are lower. It is thought the current rally has induced some cash corn to move. Processors show the best basis levels but they are too are exhibiting some easiness. The Gulf eased vs. Friday but still higher vs. one week ago. Corn spreads eased fractionally within the current crop year and ran steady to better vs. the new crop. Given my idea of good physical shipments as we move forward I’m with the idea that corn spreads really don’t have to widen any further vs. what we early last week.
The intra-day and inter-day price action of late suggests the flat price of corn is not yet done probing the upside. Daily charts still read higher but suggest not for long. As of this writing I’m thinking $3.75 should do it for the March ’17 contract.
Daily Support & Resistance for 01/24
March Corn: $3.65 – $3.75
July Corn: $3.79 – $3.89
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