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
Bank Earnings will be monitored in the market today. Also we kick start this morning with Business Inventories, CPI, Real Earnings and Retail Sales at 7:30 A.M. followed with Capacity Utilization and Industrial Production at 8:15 A.M. The Grain complex stopped it’s free-fallen mode for the moment. Dryer weather is forecasted and is prescribed in some flood ravaged areas from the recent heavy rains that the Plains desperately need. In the overnight electronic session the September Corn is currently trading at 375 ¾ which is 6 cents higher. The trading range has been 376 ¼ to 370.
On the Ethanol front we are starting to get a hint of rollovers to come shortly. In the overnight electronic session the August contract is currently trading at 1.534 which is .022 cents higher. The trading range has been 1.534 to 1.533 and is currently showing 4 bids @ 1.511 and 3 offers @ 1.539 with 9 contracts traded and Open Interest at 964 contracts. The September traded 1 contract in the overnight but the volume will pick up the pace in the coming days. The market is trading higher following the advance in Corn, Crude Oil and Gasoline in the overnight electronic session.
On the Crude Oil front the market could use a close above $47 a barrel to get the bulls back and entrenched in the game because of demand concerns will outweigh excess as long as we are below $50 a barrel we will see more production declines and new production to be shelved. In the overnight electronic session the August Crude Oil is currently trading at 4638 which is 30 points higher. The trading range has been 4654 to 4580. The International Energy Agency (IEA) is not helping matters with contradictory quotes on one hand assessing OPEC compliance on production cuts fell to 78% and on the other hand the EIA raised demand estimates and reducing its figure for non-OPEC supply which showed a sizable deficit last quarter.
On the Natural Gas front the market is relying on a stretch of hot weather to mount a sizable rally with abundance of supply and producers standing pat for the moment leveling off production at these prices. We could get a sobering surprise if the power grid is hit with hot weather and exports. At high noon we have rig counts that could spark a rally. In the overnight electronic session the August contract is currently trading at 2.951 which is 1 cent lower. The trading range has been 2.987 to 2.928.
Questions? Ask Dan Flynn today at 312-264-4374
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