Corn Market Rally Spills Over into DEC-MAR Spread
The corn market has been experiencing a strong rally lately, with the March '27 contract (ZCH27) reaching a new 52-week high of 520¾. Corn is not alone in this trend, as the entire grain market has been performing well.
According to Rich Moran, Senior Commodities Broker at Walsh Trading, lower yields in Illinois and potential severe thunderstorms in states like Nebraska, Iowa, Minnesota, and Wisconsin may contribute to continued corn price increases in the short run.
The Dec-Mar Corn Spread (ZCZ26-ZCH27) trended downward from March 16th's high of -8½ until July 17th. From July 17th until yesterday, it traded sideways between -16 and -15. Moran notes that this spread settled below its 14-day and 21-day moving averages during this time.
However, on the day of the article, the Dec-Mar Corn Spread finally broke through these moving averages by opening and settling above both. Moran suggests buying the DEC-MAR Corn Spread at -15 or better, with a risk of 2 cents and potential profit of 4 cents per spread.