Please join me every Thursday for a free grain webinar at 3pm Central. We discuss supply, demand, weather, and the charts. Sign Up Now

Commentary

Corn continues to drive higher as managed funds defend their positions on breaks while amassing a sizable net long position. Money managers ended 2024 with a net long in corn futures 228,806 futures & options contracts, their most bullish view since February 2023. Both new longs were added and shorts exited in the latest week, but the former was more prominent. While big crops coming are likely coming out of Brazil, forecasts are turning hot and dry in Argentina which in my opinion is spurring the fund buying spree. The Rosario Grain Exchange said in a note that two main growing areas, Buenos Aires and Santa Fe had seen just 1.23 inches of rain below the average of 4 inches for December. After a wet Spring, this shouldn’t be a big issue in my view. However, it only takes one person to scream fire in the theater and all go running out. Funds are acting in a similar fashion here but forecasts of hot and dry remain deeper into January where the concern lies amid the unknown. This is setting up to be a boon potentially for US producers that have unpriced bushels in the bin as deferred corn could hit 4.80 soon in my opinion. Argentina is the World’s largest exporter of soybean oil and meal and the third largest exporter of corn. We are at key areas of resistance in March corn the most actively traded contract. We closed 2024 at 4.58. Key trendline level comes in at 4.56 through next week in my view. We need to hold that level to sustain the momentum in my opinion. Should that happen, look for funds to press above the Bollinger band at 462 and chase this market to 482 (5 % higher on year) and the 100-week moving average. Consecutive closes under 456 through next week could punch the market back under 450 with the next significant target at 4.35 and then the 50-week moving average at 429. With over 228K longs here, if weather turns wetter in Argentina through January, I would anticipate a pullback forthcoming. 

Trade Ideas

Futures-N/A

Options-N/A

Risk/Reward

Futures-N/A

Options-N/A

If you would like to receive more information on the commodity markets, please use the link to join our email list Sign Up Now

Sean Lusk

Vice President Commercial Hedging Division

Walsh Trading

312 957 8103

888 391 7894 toll free

312 256 0109 fax

slusk@walshtrading.com

www.walshtrading.com

Walsh Trading

311 S Wacker Drive Suite 540

Chicago, Il 60606

Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices.PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.