Corn bulls continue trying to push the new-crop DEC17 contract to $4.00 per bushel.
Talk of more weather uncertainty in Argentina and portions of Brazil, along with continued strong demand numbers out of the U.S. provides hope and keeps prices supported. Most inside the trade are thinking the USDA will need to trim their U.S. corn ending stocks forecast on stronger than expected ethanol and export demand.
The problem is we will still be swimming in a glut of corn supply and despite some weather hiccups in South America they still look poised to produce a much better crop than last year. The bears also point to the nearby uncertainty surrounding trade relations with Mexico and several other important buyers of U.S. agriculture.
Bottom-line, I can see and understand both the bullish and bearish argument, which makes me think we will be stuck in this 30 to 40 cent range for the next several weeks. As a producer I still believe we are going to get a better opportunity to market both old-crop and new-crop corn. I'm not looking for anything explosive to the upside, but I think we could still see another leg higher.
From a technical perspective it feels like new-crop DEC17 corn has more heavy support down in the $3.65 to $3.75 range with heavier resistance in the $4.00 to $4.20 range. Old-crop support seems to be in the $3.40 to $3.50 range, with upside resistance in the $3.70 to $3.80 range.
As a producer I will be looking to make more sales and reduce risk if we test the upper ends of these ranges. As a spec I continue to like the thought of trading with a range-bound mindset and looking to take advantage of cheap volatility.