Strong buyer support had quickly developed in September futures contracts through the first week in September. Despite pressure in corn markets, lower inventory levels and the concern to secure spot month product caused traders to flock to the soon-to-expire contract. September contracts expired Thursday, allowing October markets to take the role in the spot month position.
The wide price spread between the September and October contract month then left a sharp cliff for chart watchers to maneuver with prices seemingly falling nearly 70 cents per gallon instantly. October futures actually ended unchanged Friday, but moves on the continuous chart adjusted to prices not seen since 2010. This will likely create uncertainty through the complex over the near and distant future.
Rick Kment can be reached at firstname.lastname@example.org