Play Turner’s Take Podcast Episode 229

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New Podcast

I am working from home while IL has a Stay at Home order in effect until May 31.  My office phone 312-706-7610 will roll over to my home office if you call my trade desk.  This week we go over why corn is due for a bounce between FND and the May WASDE. Make sure you take a listen to the latest Turner’s Take Podcast!

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Corn

July Corn has not been sub $3 since 2006.  Back then the RFS was just beginning and it is not a coincidence that the loss of corn for ethanol demand has seen prices drop this far.  We think July Corn could bound this week and rally into the May WASDE.  The funds are probably short 200K contracts.  July corn is down over 50 cents in the last two months and we are just in the beginning of the planting and growing season.  Corn is also under pressure as the May contract approaches FND.  Long have to get out and farmers with cash contracts like HTAs, DP, Basis Contracts, and other storage arrangements tied to May futures now need to either delivery, price, or roll depending on their situation.  When the market is oversupplied this tends to be a bearish force on the market in the last two weeks of a deliverable month.

First Notice Day

FND selling pressure should subside by the close tomorrow. If July Corn is going to rally I think it happens later this week and into the WASDE.  The funds have made a lot of money on the short side and I can see short covering into the big May report.  This is also the time of year when the market can get a weather rally.  Another potential bullish factor in the short term is export demand.  US corn prices are so low that it will attract buying interest.

It is possible corn can keep grinding lower but if we are going to rally, even if it is a dead cat bounce/bear market rally, I think it can happen over the next two weeks.

I want to keep all of our short new crop positions.  In the long term I think corn is lower come harvest. In the short term I like having a bullish position in July Corn. That can be buying July Corn tomorrow, buying calls, call spread, selling puts, or bull futures spreads.  Clients and anyone looking to work with me can call me at 312-706-7610 or email me to come up with a trading plan.

If you are interested in working with Craig Turner for hedging and marketing, then click here to open an account.  If you are a speculative or online trader then please click here. 

July Corn

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Craig Turner – Commodity Futures Broker

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