What Are Corn Buyers Doing?

Corn buyers are becoming concerned about what will happen when corn is harvested. They are either concerned that too much corn will come to town at harvest, or if they can sell corn at harvest.  Buyers are trying to push corn delivery into 2016 and the farther into the summer of 2016 the better. As I write Thursday, August 6, 2015 the spread between December and March 2016 corn is around 11 cents and from December 2015 to July 2016 around 22 cents.

DECEMBER 2015 - JULY 2016 CORN SPREAD August 6, 2015

With July 2016 Corn 22 plus cents over December 2015 corn, merchandisers are trying to persuade corn farmers to sell away from harvest. Using the rule of thumb at 3 cents per month, or 18 cents for 6 months to carry corn, the spread on the futures is plus 4 cents. (The actual simple carry now using December Corn at $3.80/bushel is 1.425 cents/month)**  If a farmer is storing, it pays to take advantage of the spread and sell July corn.  (more)