Corn Basis Gathers Steam Into Delivery
Best gains in Western Corn Belt.
Bryce Knorr
Published: Apr 30, 2009
A strong rally in the futures market this week doesn't appear to be shaking many corn bushels off the farm and into the pipeline. Basis strengthened again this week into May delivery, with many areas above average.
The move continues the cash market's big move off harvest lows, which brought excellent storage returns to farmers holding 2008 crop hedges. And, with cash prices again flirting with $4 in some locations, it could signal that farmers are done for the time being with sales, until they see signs their crops will get planted and off to a good start.
Easing barge freight and better exports this week may also have fed into the basis move, with cash bids strengthening at the Gulf. That helped prices along the Illinois River, where deliveries are focused, move 3 to 5 cents above May futures, contributing to fairly limited deliveries on first notice day Thursday.
To read Bryce Knorr's complete weekly basis review, click HERE.
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