Corn continues to trade near the higher end of its sideways channel. As a producer I hope past performance (last year) is not indicative of future results. I went back to review my notes and looked at a chart. Interestingly the new-crop DEC17 contract traded to $4.17 on June 17th of last year, then proceeded to tumble downhill to $3.58 by the end of August.
The old-crop JUL17 contract traded up to $4.55 on that same day, almost exactly one year ago, then tumbled to a low of near $3.40 by the end of August. Lets hope we don't see a repeat performance in price! I don't see current crop conditions anywhere near what we were experiencing last year and I feel the set-up is much different in the macro space. In any regard, I just wanted to point out and remind everyone that we tend to get overly bulled up and emotional this time of year.
In fact we really start to talk our position, which for most of us in the farming business that's from the bullish side of the fence. Weather here in the U.S. obviously remains the wild-card. The forecasts for next week looks like we could see a bit warmer than normal temps for Arkansas, Colorado, Kansas, Nebraska, Oklahoma, Missouri and Texas. I could argue the southern portion of Iowa and southwestern portion of Illinois will be a bit warmer than normal as well.
Areas to the north and east look as if temps will be below normal. If we move beyond and into the last week of June it seems like most forecasters are thinking the entire corn belt from the central to the south will witness above normal temps. In other words the only break from the heat will likely be in areas of the Dakota's, Michigan, Minnesota, Montana and Wisconsin. As for rain, it looks like the western portion of the U.S. will be fairly dry, while the eastern portion will see more widespread precipitation.
With the recent widespread rains I don't really see crop-conditions taking a big step backwards next week, so I suspect the market will continue to trade inside its current range. I believe we are going to need another round of weather headlines closer to pollination to push us past nearby resistance.
The demand headlines just don't have enough horsepower to pull us higher without some supply-side help. Continue watching the weather.