Largest U.S. corn crop no match for Mother Nature. So who is selling?

Market Pulse: July 10

Last week December 2012 Corn (new crop) opened at $6.49¾ per bushel and closed the week at $6.93. Now, if you have not heard yet, the U.S. is dealing with a drought. At this point, the Drought of 2012 is not as bad as the Drought of 1988, yet. The 1988 drought was the worst since the 1930s dust bowl, and we saw crop damage come in at $78 billion. 

Below you can see the corn Condition from the USDA Crop Progress released yesterday. Look at the Poor and Very Poor columns. These numbers have climbed considerably over the past two weeks. Look at how many states are dealing with 40%-60% in Very Poor and Poor. Look at Kentucky, 72%. There is a point where even if rain comes it may be too late for corn. I have a call into my favorite farmer to find out exactly when that is. Keep in mind that if tomorrow’s WASDE report is bullish, corn prices could hit all time highs. Stay tuned.

Technicals, which at this time takes a backseat to weather, on the daily chart below you see ADX at 67 reflecting a very strong trending market. MACD is bullish and Stochastics are in deep overbought territory. You can see the technical trade set-up showing up on June 18 (see the green line), same time when we saw Producers change from net long to net short.

Click image to enlarge.


Proceed to Page 2 for the latest COT Data...

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