March Corn closes 6 cents higher ($3.85 ), July 6 cents higher ($4.00 ) and Dec 4 cents higher ($4.10 )
April Chgo Ethanol closes 0.003 cents a gallon lower (1.512), May 0.003 cents higher ($1.520)
Weekly Corn Export Sales old crop vs. 1.000-1.500 M T. expected new crop vs. 0-100 K T. expected
CONAB Brazilian corn crop; 87.28 M T. (25.12 + 62.16) vs. 88.00 M T. last month (24.7 + 63.3)
USDA announces 110.0 K T. of corn sold to Japan
Highlights of USDA Supply-Demand US lowers carryout by 225 million bu. (increases export by 175 million bu. increases ethanol usage by 50 million bu.) World increases carryin by 2.10 M T., lowers carryout by 3.92 M T. (the big feature was lowering Argentinas production by 3.0 M T. and increasing total usage by 6.02 M T.)
BAGE (Buenos Aires Grain Exchange) suggests the Argentine corn crop is 34.0 M T. vs. previous estimate of 37.0 M T. vs. USDA at 36.0 M T.
I have one major question: Why isnt the USDA (94.5 M T.) more in line with CONABs corn crop estimate (87.28 M T.)? Are they leaving the door open for a better 2nd season corn crop?
Flat price corn moves to new highs for the current rally that started back in mid-January. The trade took their cue from the noticeably lower US carryout/better demand. I have to think the trend of better demand could continue especially if the Brazilian corn crop stays steady with the recent CONAB estimate.
If one looks at the last 6 days of interior basis quotes it suggests a defensive tone. The Gulf, on the other hand, has been increasing for the same time frame. Todays flat price rally has corn spreads within the current crop yearincreasing fractionally old crop is a noticeably gainer vs. the new crop. The old crop/new crop spreads further the theory the corn market is now being led by demand.
It looks like $4.00 is the next upside target for May corn. Dec corn is looking at $4.14. This is not saying a whole lot given where prices currently are. I have to think there is still a fair amount of cash corn for sale over the market but given what the USDA had to say the market is going to need it. Volatility remains rather low and that keeps the market action in a grinding type mode.
Daily Support & Resistance for 03/09
May Corn: $3.89 - $4.00
July Corn: $3.96 - $4.07
Dec Corn: $4.06 - $4.17
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