May 24, 2023

After trading mixed overnight, it was looking like grains were going to rally on Wednesday but soybeans had fallen into lower trade by midday. July soybeans were able to pull it together late in the session for a 2 cent higher close on the day. Corn was able to hold a nice gain of 10 cents on the July contract but was only 2-3 cents higher from September on out. Weekly ethanol data showed production down 4,000 barrels/day to 983k bpd and stocks off 1.15 million barrels to 22.04 mln bbls. Both numbers were lower than expected. Corn use for ethanol is 40 million bushels below the seasonal pace needed to meet the USDA target for the year.

With 5 consecutive days of higher highs and higher lows, July corn has made a nice push back above the 20-day moving average. Will be interesting to see how the market wants to trade around the 600’0 level if we are able to challenge it. Given our +0.15 basis, cash corn in the $6.15-6.20 range is a good short term target here.

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