Corn Commentary
March closes 1 ¾ cents lower ($3.58 ¼), July 1 ½ cents lower ($3.72 ½) and Dec 1 cents lower ($3.86 ½)
Feb Chgo Ethanol closes 2.7 cents a gallon lower ($1.524), March 2.3 cents lower ($1.540)
USDA announces 130 K T. old crop corn sold to Taiwan, 91.3 K T. old crop corn sold to unknown, 150 K T. new crop corn sold to unknown
CONAB suggests the Brazilian corn crop is 84.5 M T. vs. 83.8 last month – 1st season corn crop 28.4 M T., 2nd season corn crop 56.1 M T.
It was a consolidating type trade for corn prices on Tuesday. The daily price range for Tuesday stayed inside of Monday’s range. As far as index fund rebalancing is concerned – it was there but it has been so well advertised the daily trade was waiting for it so whatever buying they did had minimal effect. The announced USDA corn sales were good for some chatter but that was about it. The Brazilian corn crop estimate fell on deaf ears as most in the trade realize it’s the 2nd season corn crop that makes or breaks their production total. It was last year’s 2nd season corn crop that got hit hard with dryness and that in turn brought their crop size down.
Little to no change was seen with the interior corn basis on Tuesday. The only change that I saw was the Ohio River down 2 cents. The Gulf market, too, was a shade easier, down 1 cent. Corn spreads ran steady to fractionally easier within the current year; old crop edges lower to the new crop.
The trading range affair continues for corn prices. It is doubtful that the price action will give us any major move/directional signal ahead of the USDA reports on Thursday. I have attached the table of estimates for your convenience.
Daily Support & Resistance for 01/11
March Corn: $3.55 – $3.61
July Corn: $3.69 – $3.76
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.