Morning Comments January 7, 2020

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Opening Calls:
Corn steady to down 1
Beans down 2 to 3

Corn continues to trade down with weak export numbers, and exports lagging 53% behind last year. Combined with the closing of 13 ethanol plants, we could see the USDA reduce demand on Friday. The trade continues to be worried about the 2020 crop, if the U.S. plants 94 million-plus acres of corn, with any upward change to carry out, we could see futures fall.

Beans are trading lower too, with exports at a 12 week low, trade is waiting for the CONAB and USDA reports, and Argentina temporarily suspending their 3% export taxes on soybean meal. 

We’ve included this March 2020 Futures Chart to understand what the Technical Traders are looking at.

  1. Looking at this chart, it shows how carry erodes over time, and the further out you sell the more you get per bushel. Ex: If you sold Futures on March 25, you would be 26 cents above current prices.
  2. We have tested the 23% retracement level for March 20 Futures, which is $3.92 several times and unable to break through the resistance level.
    1. Current futures at $3.84 ¾, which technically futures could either test the limit of $3.92 again and could be a good place to make an offer ahead of the report Friday.
    2. Or we could bottom out to the level of $3.70 future level; if March futures fall below this level, we could find a new low. 
Comments 1 6 20