Dan Flynn is the writer of The Corn & Ethanol Report, a daily market letter covering grains, energies, and various global issues that are the driving force and backbone of the commodity markets. Contact Mr. Flynn at (312) 264-4374
We kickoff the day with Chicago Fed National Activity Index, Export Sales, Initial Jobless Claims, Continuing Jobless Claims, and Jobless Claims 4-Week Average at 7:30 A.M., Existing Home Sales and Existing Home Sales MoM at 9:00 A.M., EIA Natural Gas Storage at 9:30 A.M., Kansas Fed Composite INDEX AND Kansas Fed Manufacturing Index at 10:00 A.M., 4-Week & 8-Week Bill Auction at 10:30 A.M., 15-Year & 30-Year Mortgage Rate at 11:00 A.M., 5-Year TIPS Auction at 12:00 P.M., and Fed Balance Sheet at 3:30 P.M.
Home mortgage rates continue to decline, and the Mortgage Bankers Association’s weekly survey showed an average 30-year rate of 6.37%. That was the lowest in exactly 1 year, and was .15% less than in 2024. The decline has sparked a slight recovery in home buying and mortgage demand, which has recently risen to a 3-year high, but is still down 60-70% from the 2020-2021 era as home affordability remains historically weak. The latest data from the National Association of Realtors showed the Home Affordability Index at 100.5, meaning that the median home price was just barely affordable for the median income. Regionally, the Midwest was the most affordable, with the Midwest Affordability index at 125.2. The West was the least affordable region with an index of 72.9. The Northeast index was at 84.7 and the South Affordability index was at 107.5.
Interior US Corn Basis Performance Mixed
Basis level and changes in basis levels now provide the best indication of any abnormal regional corn supply & demand amid the absence of export sales, yield and even crop progress data. Rising bids at river export terminals do suggest the need to fill cargoes at the US Gulf – recall 25/26 US corn export shipments through Oct 16th are up 61% year-over-year at 368 Mil Bu. Spot corn bids in St. Louis have rallied from $.13 under in early September to $.17 over currently. Steady barge movement has provided an outlet for the first half of harvest across the central Midwest. Bids at processors aren’t exciting. Spot basis Cedar Rapids, IL, is quoted $.24 under, unchanged from recent weeks. Basis in central IL is quoted $.05 under, also unchanged and similar to last year in late Oct. Overall, neither the export or processing market is overly remarkable relative to history and implies a lack of supply fear at major markets. ARC maintains that monitoring basis will be important into mid-November to measure the impact of the last 25-30% harvest.
Corn Comments & Analysis
CBOT Corn Stays Directionless; Margins Attract Near Record Ethanol Production:
CBOT corn recovered and is holding a range of $4.10-$4.25. Hope for positive talks between US & Chinese leaders this week in Malaysia and next week in S Korea underpins breaks. South American weather plays a greater role determining exporter/global corn stocks in late November – or in just 30 days. US ethanol production in the week ending Oct 17th totaled 327 Mil Bu, tied for the third largest on record for any week. However, assuming additional modest expansion but also recent corn-ethanol conversion rates, corn used for ethanol in Oct is forecast at 473 Mil Bu, just 7 Mil above the previous year. Sep-Oct corn use must average 469 Mil Bu Nov-Aug to meet USDA’s forecast, and this compares to average Nov-Aug use a year ago of 453 Mil Bu. This will be challenging amid the abundance of cheap Plains sorghum. Central IL corn basis improved 5 cents to a 5 cent discount vs. December while basis across most of the Western Midwest held steady as the harvest advanced. Producer selling has been lite amid the hope for China to return as a US soybean buyer. US/China tensions appear to be worsening – not improving. Any rally tied to US/China trade will spark a new sales opportunity. However, President Trump continues to exhibit confidence that China will return as a soy importer. This weekend trade negotiations are high stakes with the US threatening to limit software exports to China. The US is positioning to strike against China’s limitation of rare earth mineral exports which have dramatically slowed since late September.
Have A Great Trading Day!
Contact me directly with any questions or open a trading account at 1-888-264-5665 or dflynn@pricegroup.com
Profit Margins Spark Ethanol Production. The Corn & Ethanol Report 10/23/2025
We kickoff the day with Chicago Fed National Activity Index, Export Sales, Initial Jobless Claims, Continuing Jobless Claims, and Jobless Claims 4-Week Average at 7:30 A.M., Existing Home Sales and Existing Home Sales MoM at 9:00 A.M., EIA Natural Gas Storage at 9:30 A.M., Kansas Fed Composite INDEX AND Kansas Fed Manufacturing Index at 10:00 A.M., 4-Week & 8-Week Bill Auction at 10:30 A.M., 15-Year & 30-Year Mortgage Rate at 11:00 A.M., 5-Year TIPS Auction at 12:00 P.M., and Fed Balance Sheet at 3:30 P.M.
Home mortgage rates continue to decline, and the Mortgage Bankers Association’s weekly survey showed an average 30-year rate of 6.37%. That was the lowest in exactly 1 year, and was .15% less than in 2024. The decline has sparked a slight recovery in home buying and mortgage demand, which has recently risen to a 3-year high, but is still down 60-70% from the 2020-2021 era as home affordability remains historically weak. The latest data from the National Association of Realtors showed the Home Affordability Index at 100.5, meaning that the median home price was just barely affordable for the median income. Regionally, the Midwest was the most affordable, with the Midwest Affordability index at 125.2. The West was the least affordable region with an index of 72.9. The Northeast index was at 84.7 and the South Affordability index was at 107.5.
Interior US Corn Basis Performance Mixed
Basis level and changes in basis levels now provide the best indication of any abnormal regional corn supply & demand amid the absence of export sales, yield and even crop progress data. Rising bids at river export terminals do suggest the need to fill cargoes at the US Gulf – recall 25/26 US corn export shipments through Oct 16th are up 61% year-over-year at 368 Mil Bu. Spot corn bids in St. Louis have rallied from $.13 under in early September to $.17 over currently. Steady barge movement has provided an outlet for the first half of harvest across the central Midwest. Bids at processors aren’t exciting. Spot basis Cedar Rapids, IL, is quoted $.24 under, unchanged from recent weeks. Basis in central IL is quoted $.05 under, also unchanged and similar to last year in late Oct. Overall, neither the export or processing market is overly remarkable relative to history and implies a lack of supply fear at major markets. ARC maintains that monitoring basis will be important into mid-November to measure the impact of the last 25-30% harvest.
Corn Comments & Analysis
CBOT Corn Stays Directionless; Margins Attract Near Record Ethanol Production:
CBOT corn recovered and is holding a range of $4.10-$4.25. Hope for positive talks between US & Chinese leaders this week in Malaysia and next week in S Korea underpins breaks. South American weather plays a greater role determining exporter/global corn stocks in late November – or in just 30 days. US ethanol production in the week ending Oct 17th totaled 327 Mil Bu, tied for the third largest on record for any week. However, assuming additional modest expansion but also recent corn-ethanol conversion rates, corn used for ethanol in Oct is forecast at 473 Mil Bu, just 7 Mil above the previous year. Sep-Oct corn use must average 469 Mil Bu Nov-Aug to meet USDA’s forecast, and this compares to average Nov-Aug use a year ago of 453 Mil Bu. This will be challenging amid the abundance of cheap Plains sorghum. Central IL corn basis improved 5 cents to a 5 cent discount vs. December while basis across most of the Western Midwest held steady as the harvest advanced. Producer selling has been lite amid the hope for China to return as a US soybean buyer. US/China tensions appear to be worsening – not improving. Any rally tied to US/China trade will spark a new sales opportunity. However, President Trump continues to exhibit confidence that China will return as a soy importer. This weekend trade negotiations are high stakes with the US threatening to limit software exports to China. The US is positioning to strike against China’s limitation of rare earth mineral exports which have dramatically slowed since late September.
Have A Great Trading Day!
Contact me directly with any questions or open a trading account at 1-888-264-5665 or dflynn@pricegroup.com
Thanks,
Dan Flynn
Questions? Ask Dan Flynn today at 312-264-4374