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Corn Market - Just My Opinion

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USDA (OCE) is suggesting corn planted acres for 2018-19 will be 91.0 million (90.4 year ago) leading to a crop size of 14.520 billion bu. (yield 173.5 bpa) and a carryout of 2.607 billion bu. (current projection for 2017-18 is 2.487 billion)

It seems to me its all about liquidation ahead of first notice day as spreads widen. It was just last week the Dec/March spread traded into 10 under; today it traded out to 13 under. March forward spreads have been pretty flat for the past couple of weeks as they hover just above contract lows. The same can be said for the old crop/new crop spreads. Not much attention was paid to the USDA announcement for next years acreage data despite it being higher vs. this past year. Im not sure too many believe it given how depressed prices have been. Chatter continues that China has been slipping in and out of the US corn export market this past month. If true they have done it a manner that has had very little impact on the market. Other news of note remains lacking. Most will agree we have some pretty good domestic demand (ethanol & feed). It is thought that as we move into the New Year export demand will pick up noticeably time will tell on that one.

Other than the Ohio River basis falling out of bed today most other locations ran steady to better. Processors still show the best bids out there followed by Illinois River locations. Toledo, too, appears to be in the chase to originate corn. The Gulf is stable while slowly trending higher. Despite what appears to better cash markets spreads remain soft. If we are indeed being impacted by first notice day I would expect spreads to rebound once 1st notice day has come and gone.

Dec corn registers new contract lows; March comes within a half cent while July came within three quarters of a cent. If the current break is all about first notice day I would expect a rebound in the flat price on either the 30th if not the 1st of the new month.

Daily Support & Resistance for 11/29

March Corn: ??? - $3.54

July Corn: ??? - $3.70

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About the author

Tom Fritz is a third generation commodity futures trader. His grandfather and his father were traders on the exchange. Tom began his career in 1971 with Tabor Grain which was later acquired by Archer Daniels Midland. Prior to co-founding IFG in 1994 Tom was the lead Chicago Board of Trade floor analyst for ADM. He produces Just My Opinion, a daily grain commentary that is well respected and viewed all over the world.



Contributing author since 11/7/2017 

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