Euro Slowdown Puts Unexpected Cog in the Wheel. The Corn & Ethanol Report 02/07/19

We start off the morning with Export Sales and Jobless Claims at 7:30 A.M. followed by EIA Gas Storage at 9:30 A.M. and Consumer Credit at 2:00 P.M. On the Corn front we had another narrow trading range and some traders are fearing a break down on the Grain Complex with Soybeans leading the way and expectations are to test 850 this summer. Improving weather in South America is casting further doubt in the bulls minds. Today we have Export Sales and the Chinese are buying Soybeans and Corn. Today’s Export Sales and tomorrows Crop Production and USDA Supply/Demand may take a back seat as talks with China resume next week and there seems to be light at the end of the tunnel in these extremely delicate talks with Intellectual Property the sensitive issue for both sides. President Trump did mention that the Chinese were never challenged before in other administrations and is not used to negotiate for something they took for granted but this issue has been driving American businesses down the drain. In the overnight electronic session the March Corn is currently trading at 379 ½ which is a ½ of a cent lower. The trading range has been 380 ¼ to 379.

On the Ethanol front there were no trades posted in the overnight electronic session. The March contract settled at 1.307 while the Open Interest declined in yesterdays trading session to 1,482 contracts. The market is currently showing 8 bids @ 2.617 and 7 offers @ 2.619.

On the Crude Oil front overrated bad economic data out of the Euro-zone brought U.S. Stocks down following suit and the Crude Oil followed that suit. In the overnight electronic session the March Crude Oil is currently trading at 5327 which is 74 points lower. The trading range has been 5421 to 5323.

On the Natural Gas front we have the weekly Gas Storage report which analysts are predicting record draws. Reuters polled 19 analyst,, with withdrawal estimates ranging from 260 bcf to 222 bcf with the median draw of 247 bcf. This compares to the one-year draw of 183 bcf and the five-year average draw of 160 bcf. Colder temperatures are forecasted with bone-chilling Arctic air and if we get a record draw we could see this market turnaround. In the overnight electronic session the March contract is currently trading at 2.612 which is 5 cents lower. The trading range has been 2.691 to 2.596.

Have a Great Trading Day!
Dan Flynn

 

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