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Will corn remain in a narrow trading range?Will corn remain in a narrow trading range?

Trade talk with China is dominating the headlines this week.

Kevin Van Trump

November 20, 2018

2 Min Read

There's just not a lot of fresh or new headlines. Trade talk with China is clearly dominating and directing the soybean market and corn is obviously being tugged around a bit in its wake.

Bears are looking deeper at "demand" and wondering if some of the USDA's current estimates aren't a bit too overly optimistic? There was a good sale announced to South Korea, but weekly export inspections were again somewhat of a disappointment. Negative ethanol headlines are also making some wonder about corn used for ethanol demand?

From a technical perspective, the DEC18 contract hasn't closed sub-$3.60 since late-September. The MAR19 contract hasn't closed sub-$3.70 since late-September. Both contracts are extremely close to breaking nearby support, so be paying close attention.

As a spec, I've been waiting for another leg lower to start building a longer-term bullish position. It looks like I might soon get my opportunity. It will be interesting to see if we can hold the lower end of nearby chart support.

Clearly, we need some help from the macro market headlines i.e. improved global economic growth outlook, or some type of positive confirmation involving Chinese trade negotiations. A bullish wild-card could obviously be South American weather, but as of right now the trade doesn't seem to be paying that much attention, and there's really nothing to get the bulls overly excited.

Here at home, the USDA is now estimating the U.S. corn harvest at 90% complete which is -3% below the 5-year average and a bit less than most in the trade were expecting to see. The only states running ahead of schedule include: Illinois which is 100% complete and +3% ahead of historical pace; Tennessee and Wisconsin are slightly ahead of schedule. Indiana and North Carolina are running right on schedule. States the furthest behind their traditional pace include: North Carolina -17% behind with 71% now complete; South Dakota -11% behind with 82% now complete; Pennsylvania -8%, Ohio -6%, Kansas and Nebraska -5%, Colorado, Iowa and Michigan -3%, Minnesota and Texas -2%, Kentucky and Missouri -1%. 


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The opinions of the author are not necessarily those of Corn+Soybean Digest or Farm Progress.

About the Author(s)

Kevin Van Trump

Founder, Farmdirection.com

Kevin is a leading expert in Agricultural marketing and analysis, he also produces an award-winning and world-recognized daily industry Ag wire called "The Van Trump Report." With over 20 years of experience trading professionally at the CME, CBOT and KCBOT, Kevin is able to 'connect-the-dots' and simplify the complex moving parts associated with today's markets in a thought provoking yet easy to read format. With thousands of daily readers in over 40 countries, Kevin has become a sought after source for market direction, timing and macro views associated with the agricultural world. Kevin is a top featured guest on many farm radio programs and business news channels here in the United States. He also speaks internationally to hedge fund managers and industry leading agricultural executives about current market conditions and 'black swan' forecasting. Kevin is currently the acting Chairman of Farm Direction, an international organization assembled to bring the finest and most current agricultural thoughts and strategies directly to the world's top producers. The markets have dramatically changed and Kevin is trying to redefine how those in the agricultural world can better manage their risk and better understand the adversity that lies ahead. 

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