In my March column (“Hoping for a Spring Rally in Prices”), I showed that January highs in December corn futures prices during the first half of the year were not common. In 17 of the last 20 years, the highest December corn futures price in the April-May-June period exceeded the January high. My analysis was meant to offer a ray of hope for another chance at better prices in the months ahead.

Analysis

It is frustrating to note that two months have passed since I published the piece, and the January 4 closing price of $4.98¾ remains the highest closing price in the current year. But the analysis inspired me to think deeper about tendencies in the December new crop contract for corn. I expanded my analysis to look at the price history since 1990, in order to answer the following questions.

In what months have the highest price for December corn futures been established?

Since 1990, December corn futures reached its highest closing price in the months of May and June (see chart). Contract delivery year high prices occurred only three times in the Jan/Feb period (the current year-to-date high). Jul/Aug recorded the second most high prices since 1990.

Data source: CBOT closing prices for December corn

In what months have the lowest price been established?

 In 12 of the last 34 years, December corn futures reached its lowest closing price in the months of November and December (see chart). I found this modestly surprising, as I expected the Sep/Oct period to record more lows. I find it curious to note that the Jul/Aug period, which recorded the second most high prices, also recorded the second most low prices. An old commodity saying is that “July makes the corn crop,” and the equal chance of a high or a low in the Jul/Aug period speaks to the make or break importance of these two months in corn production.

In what month has December corn prices shown the greatest volatility?

The last chart shows the numbers of years when the monthly min/max price spread was greater than 10 percent of the price at the start of the month. Let me put that in English. If December corn were trading at $4/bu. at the start of a month, this chart records years when the difference between the highest and lowest price in the month would have been greater that 40 cents per bushel (if $5 corn, the min/max spread was greater than 50 cents, etc.).

During the month of July in 24 of the last 34 years (70percent), the min/max price spread was greater than 10 percent. With Dec’24 corn futures currently trading near $4.70/bu., this chart indicates a “normal” July trading range of 50 cents or more per bushel.

Data source: CBOT closing prices for December corn. “Dec” refers to the month one year prior to the delivery month.

Nobody should be surprised to learn that the months of June, July and August – aka the growing season – show the greatest price volatility.

While this analysis of December corn futures prices revealed few surprises, I found it to be an interesting exercise. Next month I will take the same approach with November soybean futures prices.