Thirsty Corn Setting up For Bounce

By Phil Streible

Corn futures are ticking higher this morning, as a late start to planting and dry August weather could be setting up for a fall bounce. From a technical point of view, the chart pattern looks set up for a move above the 50-day moving average, which should put December corn futures at $6.53 a bushel. I see a possible bounce to $7.

Professional Farmers of America (Pro Farmer), a web site and advisory service which a lot of grain analysts pay attention to, pegged the 2008 U.S. corn crop at 12.152 billion bushels, and cut their yield-to-acre estimate to 153.3 bushels per acre, lower than the USDA’s last forecast of 155. It looks like the crop is a bit immature given spring flooding that delayed planting, and Pro Farmer estimates an early frost could lower the yield-per-acre to 147. There was news of frost already hitting the upper Midwest, although not in key growing regions. But dry weather is in the forecast, adding to the bullish tone. Read full article with Phil’s corn trading strategy.