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
We kickoff the first day of June and being it Friday we will have Unemployment at 7:30 A.M. coupled with a day delayed Export Sales data due to the Memorial Day holiday. At 9:00 A.M. we have Construction Spending and ISM Manufacturing Index and at 2:00 P.M. we have Cotton System, Fats & Oils and Grain crushing. On the Corn front investors are keying on the tariff talks and weather. They are wondering what will happen if we go into an all-out trade war. Canada, China and the European Union are fighting back with their tariffs. However, I do believe when the smoke clears we will be doing business. In the overnight electronic session the July Corn is currently trading at 395 which is 1 cent higher. The trading range has been 396 ¼ to 393 ¾.
On the Ethanol front the June contract expires Tuesday June 5th. There were no trades in the overnight electronic session. The July contract settled at 1.482 and is currently showing 2 bids @ 1.486 and 1 offer @ 1.491 with Open Interest at 1,174 contracts.
On the Crude Oil front the Energy Information Administration monthly report released yesterday May 31st told us U.S. Crude Oil production jumped to 215,000 barrels per day (bbl/d) in March, the highest on record. We are still playing headlines with Spain joining Italy ousting the government leader to leave the EU. When their banking realizes they will not have the backing of the EU they will realize such as Greece did they will have a run on the banks and no one to bail them out. We will be chopping just like when we had Brexit and when it is all laid out on the line we go back to somewhat normal trading when unfounded fears subside. In the overnight electronic session the July Crude Oil is currently trading at 6624 which is 80 points lower. The trading range has been 6734 to 6609.
On the Natural Gas front the July contract is currently trading at 2.947 which is a ½ of a cent lower. The trading range has been 2.962 to 2.939. This market has had multiple personalities, more than Cybil.
Therefore I still remain on the sidelines. Investors seem to be shying away from selling in the hole even though reality tells us otherwise.
Have a Great Trading Day!