There has been a lot of discussion about the timing of the low in December corn as to what level and when.
Through September 23, the contract low has been $4.46 that was established August 12 but ideas that 2013 U.S. corn production estimates will move higher has many in the trade looking for another 25-50 cents of downside.
The accompanying graphic shows the low in December corn as a percent of the yearly average and high price with the 26-year average for both.
The period covered is 1986 to 2012 from January 1 to November 30.
For this period the low of December futures as a percent of the yearly average is 83.6% and the low as a percent of the yearly high is 70.2%.
Through September 23 the high in December 2013 futures is $6.00 and the Jan 1 to Sep 23 average is $5.32.
Applying the above percent numbers to these figures indicated a potential low of $4.45 if the 83.6% of the yearly average figures is used to a low of $4.21 if the 70.2% of the yearly high figure is used.
The percentages of some years are quite low but that is often due to prices coming well off the yearly high and average.
Perhaps the most extreme example was in 2008 when the December 2008 futures attained a contract high of $7.88 per bushel on June 27.
The second half of that year was characterized by a collapse in all commodities prices spurred by the then developing financial crisis.
This caused corn futures to plunge with the low being $3.33 on November 30.
This resulted in a low 42.3% of that $7.88 figure and 59.6% of the yearly average that came out to be $5.59 per bushel.
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