With corn prices retreating from the the high levels set at the beginning of the month, cash sales have slowed. Sluggish sales in some areas have led to tighter supplies and increasing basis. Over the past month basis rose several cents through out most of the county. Continuing export strength has also helped basis. Weekly export inspections came in at 32.4 million bushels - the high end of analyst expectations of 29-34 million bushels. Cumulative shipments are now 37% of the USDA forecast for the year, while the 5- year average is only 31%.

The largest basis gains this month were seen in the Northeast, where some markets raised basis over 10 cents. Moving west, basis increased less, with gains of 5 cents seen through parts of Michigan, Wisconsin and Missouri. Pockets of weakness were seen in Western Minnesota, Illinois and Iowa where basis declined by as much as 2 cents.

This week basis was unchanged or slightly higher at all of the select markets listed below. With basis nearly unchanged for most market this past week, increases of 4 and 5 cents at Eddyville, Iowa and Pekin, Illinois stand out. Basis was also strong to the north, as basis rose 2 and 7 cents at Stanley and Milwaukee, Wisconsin. A significant basis increase was also seen at Cincinnati, with an increase of 6 cents this week. With Monday's futures rally cash sales may pick up again and basis may give up some of the recent gains later this week.

Over the past month, a pull back in basis at many key ethanol facilities attributed to the pockets of weakness in basis seen in the map above. Some of the largest gains in basis in this past week have been at ethanol plants. This may signal returning strength for corn basis at ethanol facilities.

We are now well into the winter basis doldrums. Two months ago we were seeing double digit basis changes. Now an increase of one or two cents is the norm. This sort of pattern will likely continue through this next month. If you need to market your grain in the short term be sure and watch for price differentials between your local market and nearby neighboring markets. Trucking opportunities are more difficult to find in a flat basis market, but if you dig around and look up enough prices you may be surprised by what you can come up with.

Producers in Illinois will want to be watching basis at Decatur and Beardstown. Currently Decatur's price is high enough that there are 80 nearby markets where price is so much lower that it would pay more than 5 cents a bushel to truck corn to Decatur rather than the local market. That of course includes trucking costs of 32 cents per 100 miles. Beardstown is priced high enough to capture grain from over 40 nearby markets. These premium markets are pulling grain from roughly 70 miles away, so if you are within this radius you may want to consider these markets if you are not already doing so. While watching your local basis may not prove very exciting in the next month, a detailed study of all of the possible grain buyers in a 100 mile radius may help you identify a premium market you were not aware of.

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