Around the Markets

Organic Corn trading activity is picking up for contracts with delivery in November and December. Prices have dipped to $7.25-$7.75 range on the farm, for new crop corn, and $1 higher at elevators.  Prices are trading under pressure as space is becoming an issue, since there does not appear to be enough farm storage to handle the current harvest.  The carry for corn remains near $0.25 per quarter. Non-gmo yellow #2 CIF remained steady at $0.10 premium over conventional for new crop delivery. While the harvest for conventional corn is approximately 60% complete, the organic harvest is just getting underway.

Corn board futures prices remain near the upper end of a 3-month range. Per the most recent commitment of trader’s report released for the date October 18, 2016, managed money significantly reduced short position in futures and options by 42K contracts which is slightly more than 13%.  Managed money also increase long positions by approximately 19K contracts. Managed money that is short futures and options outnumber managed money that is long by approximately, 70K contracts down from 131K contracts, last week which has reduced the chance of a significant short squeeze.

Mid-west organic soy bean prices are experiencing moderate activity for November and December delivery. Prices have drifted to the $17.25-17.75 range, with a carry for the first quarter of approximately 25 cents per bushel. The prospect of a huge harvest has weighed on non-gmo prices. Non-GMO soybean CIF for November and December delivery are trading $0.20 –  $0.30 above cash prices for new crop. Approximately 76% of conventional soybeans have been harvested, flat year over year, just as the organic harvest is poised to begin.

Despite the specter of robust bean yields, bean oil futures prices have broken out on a weekly basis closing above resistance near a downward sloping trend line. The next level of target resistance is seen near the January 2014 lows at 36.60 cents per pound, and then the June 2014 highs near 41.05.