It’s no surprise that the current drought and heat wave that is plaguing the country is having a severe impact on the corn markets. Since June 22, Dec corn has rallied nearly $2 a bushel as of yesterday’s high. The July USDA report yesterday slashed corn yields from 166 bushels an acre in June’s report, to 146 bushels. Ending stocks for 2012/13 drop from Junes 1.881 Bil Bushel to July’s 1.183 Bil bushel. The report was bullish for corn, despite the cut in demand. Shortly after the report Dec corn rallied to its high of 7.480 before retreating to a low of 6.852, and finally settling at 7.040. Rumorville was in full effect as many traders expected the EPA to cut the ethanol mandate lower, and traders started booking profits as a reaction.
This morning Dec corn is up 24 cents. The weather shows limited rain in the forecast for the Corn Belt. Many traders who joined the sidelines yesterday are back in. Yesterday’s low was on target with last Thurs and Fri’s lows. The market gapped higher from July 3rd 6744 close to July 5th open at 6890. That gap wasn’t filled yesterday although remains a strong area of support. Sell off in corn is seen as good buying opportunities. As long as moisture is limited in the Corn Belt, look for pullbacks as entry points.
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James Lombardo
Commodities Broker
After attending the University of Kentucky, James Lombardo was encouraged by friends in the industry to get involved in the markets. As a home-grown Chicagoan in the hub of the commodity markets, he came to appreciate the impact they have on the global economy. James came to RJO Futures to be a part of a top reputable firm and enjoys working in an environment where no two days are ever the same. Understanding his clients' objectives is critical in formatting a proper plan in helping them achieve.... Read More
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