This is the time when the spring price low in December corn typically is made. Since 1970, the average date is June 3; since 1997, June 12; and since 2004, May 20, reports Bill Fordham of C&S Grain Market Consulting, Ohio, Ill. On the daily chart, the spring high occurred on May 12 at $3.98. In all three periods, the spring low has averaged 84% to 88% of the spring high. In 2010, that points to a low in the $3.33 to $3.49 range. "Many cycle analysts are expecting a significant cycle low in the corn market in early June. Don't panic sell now,” Fordham says.
Could this be the low for the year? Fordham's expectation for an annual low for December corn was in the $3.40 to $3.90 range. "The current low at $3.595 is low enough to fit if the contract starts a serious rally soon,” he says.
"Last Friday's high was $3.715; this will be the first important hurdle for December corn to close above before we may consider that the spring low has been established.”
The summer high is the next seasonal to unfold, he says. "The average date is July 15. Until December corn posts two daily closes in a row above the $3.93 to $3.99 range, selling pressure by both producers and nonproducers will likely continue to cap rallies.”