Grain Exchange – 5-20-2021

In a volatile trading environment, such as the one we are in, we quickly acknowledge grain commentary can start to sound like a broken record. The USDA slightly lowered its ending carryout for corn last week and the market has taken nearly a dollar away since then. We are currently in a technical trading pattern that will hopefully find its new range soon. Today’s slightly higher close for the July contract after trading 0.18 lower early afternoon is technically strong, but we just have to wonder how high old crop corn can stay for a sustainable period of time without triggering the technical selling like we’ve seen this last week. In short, we expect the choppy trade to continue and for the cash market to remain strong.

Let’s talk about the strong cash market. End users and commercials are looking for corn. There are a lot of producers delivering at this time because they’ve wrapped up with planting and now have the time to fill summer contracts. If this is you and you have unpriced bin corn, we would love the opportunity to buy your grain. We have options if you would like to stay in the market for upside potential as well. We can help you with a basis contract; this would keep the futures price open; you deliver the corn and not carry the risk of holding its condition into the summer and lock in the basis. The current cash basis in Evansville is 0.15 over the July contract for May delivery and 0.05 over for June. Please call your local Grain Sales Specialist to work through which delivery location and pricing option is best for you. Having our trucks pick up your grain for a reasonable cost may also be an attractive option for you. Using the Evansville location as an example, May delivered corn settled at $6.75 cash price today. We know volatile markets can scare some from even being involved. That’s why we’ll continue to encourage you to set price targets for old and new crop grain. There is still great margin available, but also great risk. We’re looking forward to hearing from you!