Grain Market Update – November

Aurora Cooperative 10 months ago

In the last 30 days, we have seen December corn futures trade approximately a 50 cent range. We tested the $7.00 resistance level for several days but we were not able to close above that mark. The market has since traded below the 200 day moving average but the 100 day moving average held support around $6.50. Almost all the carry has been taken out of CZ/H spread and currently CZ/N spread is trading at 5 cent inverse. Throughout harvest, basis was firm creating opportunities for good cash sales across the scale. Ethanol profitability over the next 4 months would be an item to monitor. If we see ethanol margins continue to slip, I expect local plants to slow down production. Any reductions in demand could be exactly what is needed to stabilize US stocks.

Below is CZ22 for Old crop corn futures:

Currently, 2023 crop corn prices are trending higher than soybeans. This may lead to the market anticipating an increase in corn acres compared to soybean acres. As we prepare to plant one of the most expensive crops ever, look for opportunities to lay off risk by selling new crop. Utilizing orders gives us the ability to take advantage of volatility and sell rallies. Hedge your cost of inputs by setting futures targets to lock in profitability for your farm.

Below is the spot corn to bean ratio:

Sam Johnson

Grain Hedge Desk