Posted by: usset001 | November 3, 2010

Still thinking about the corn spreads

December/July Corn Futures Spread

Futures prices for corn remain high but, for the moment, they appear to be plateauing as the market searches for new news (Will it come from the next WASDE Report, on Tuesday, November 9?).

I can’t help but note that the corn spreads have been slowly widening over the past few weeks from about 16.5 cents in mid-October to 22.5 cents today. This spread action is not consistent with the theme of a continuing strong bull market.

July Corn Futures Prices

Savvy traders like to keep their eye out for divergences in the market, i.e. mixed messages from different sources of information. Bulls could feel more confidence if the carries in the corn market were continuing to narrow, rather than widen.

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