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Is $4 corn here to stay?

corn-wymore 8-14

A market analyst says weather will determine if $4 dollar corn is here to stay.

Mark Schultz with Northstar Commodity in Minneapolis tells Brownfield corn has rallied to five month highs on weather concerns in Argentina and Brazil.

“If we’re going to see corn (prices) here to stay, I believe you’re going to have to continue to see a little bit more crop problems unfold (in South America).  And possibly get some type of a crop scare here.”

He says the strength in soybean trade has provided some spillover support to the corn market, but there are other positive factors–like a recent uptick in export demand.

Schultz suggests some kind of an options strategy as prices inch closer to break-even levels.

“You’re going to see farmer selling-not a lot-but I think somewhere between this $4.10 to $4.20 (price range).  People need to start looking at leaving the top open, or buy puts (and) sell some calls.  Something like that to get something on the books here on getting some sales.”

Schultz says a good indicator of the potential staying power of the corn rally is if the market can closer higher today after Thursday’s sharp selloff.

 

 

 

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