Walsh Corn Opportunities - Pure Hedge
The September crop report is scheduled for tomorrow. Corn conditions were lower again on Tuesday’s Crop Progress report, falling by one point. Falling crop condition ratings point to a lower yield, although a surprise increase to harvested acres is still possible. The average pre-report yield estimate is 178.1 bushels per acre, compared to the August estimate from the USDA of 180.7 bpa. Yield estimates range from 173.2 bpa on the low end to 182.9 bpa on the high end, according to Bloomberg. The average estimate for corn production is 15,777 billion bushels, while harvested acreage is estimated unchanged from last month at an average of 88.6 million acres. 2026/27 ending stocks are estimated at an average of 1,511 bb, with the lowest estimate at 1,359 mb. The USDA estimated new crop ending stocks at 1,653 bb last month. Pre-report estimates for the September report are overwhelmingly bullish and previous September reports have leaned bullish historically. Whether tomorrow’s crop is as friendly as many anticipate or not, significant volatility is likely, given that ahead managed money holds a aggressive long position. Managed money was long 431,000 contracts of corn futures and options as of September 1. If corn breaks after the report, it’s a buying opportunity from my perspective. I would look at 585-600 corn as a chance to hedge going forward in the deferred contracts. An opportunity to sell soybeans and be long corn may be setting up.
Contact me for opportunities in corn and other the grain markets.
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Hans Schmit
Broker, Pure Hedge Division
312-765-7311
hschmit@walshtrading.com
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