Todays May corn chart, corn prices were very gradually and consistently working higher in a 2 step forward 1 step backward kind of trade through most of the Fall and Winter.

But the war in Ukraine has caused prices to explode to the upside with May corn futures gaining about a $1.25 in just a little over a weeks’ time.

When the market was in a consistent gradual uptrend, minor rallies resulted in minor corrections.

 As we move forward, explosions to the upside can cause collapses to the downside and create extremely volatile trade. That what we expect in the weeks and possibly next 3-4 months to come.

This is a chart of corn prices over the last 28 years, corn hit a record high back in 2012 and today nearby March corn future hit $8 per bushel.

We are very close to the all-time record high for corn prices here in the US.

Today’s high in corn takes out last years high of 7.75.

Corn prices exploded to the upside; in about 8 trading days the market has rallied a $1.27 in the corn market.

This massive rally in just a weeks’ time is due to the Russian attack on Ukraine, concerns about old crop supplies being available to the world, at this time they are cut off, and the new crop which may be in question for Ukraine if they can’t get acres planted a month from now.

Corn prices were limit up for a good portion of the day up to 7.60 but did back off at the close closing at 7.47. About 12-13 cents off the daily high.

Chart and technical indicators are almost irrelevant as the updates and news stories coming out of Russia/Ukraine war that will drive prices in the days and weeks to come.

It’s worth noting that nearby corn prices are approaching last year’s high that was hit in early May.

Even before the Russian/Ukraine war began we mentioned that US exports were likely to be larger than USDA expected due to the massive losses in South America. The USDA has not fully accounted for this yet in their balance sheet.

We can already see from a weekly export sales chart the last 6 weeks of all seed exports above the level needed to reach USDA export.

When we combine not only South American crop losses due to drought but lack of availability out of the Black Sea region, exports are likely to run well above the level needed.

We believe when the year is over our corn exports are going out be significantly above USDA current projection.  

This important because exports being above will reduce ending stocks.

Corn prices exploded to a contract high last night, but corn prices did pull back over the course of today’s trade. Corn closed about unchanged in the May contract while new crop closed lower.

The gradual uptrend allows for corrections along the way, but as the market explodes to the upside corrections are likely to be much more significant and any sign of a ceasefire between Russia/Ukraine could cause a sharp down day or two.

Our next level of chart support is likely to come in around the $7 level, that doesn’t mean that the market can’t go lower but this will be the next level on the chart that traders may be looking for if we see a correction. That’s about 25 cents below where we closed today.

July corn today hit 7.12 per bushel, last year at this time it was trading around 5.25. So, we are almost 2 dollars higher than last year at this time.

We do view the news as being bullish but we need to recognize where we are compared to last year. Last year the market highs were set in the 7.35-7.43 range.