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
Busy economic day with earnings from Conagra and Walgreen. We also have weekly Export Sales, 1st Quarter GDP and Jobless Claims at 7:30 A.M., EIA Gas Storage at 9:30 A.M. followed by Hogs & Pigs at 2:00 P.M. We also have the G20 Summit that begins tomorrow and ends on Saturday with a host of economic & geo-political agreements or disagreements that need to be ironed out. The Eagle has Landed and supporting President Trump will be U.S. Secretary of State Mike Pompeo to help the President’s agenda to promote economic and national security with leaders around the world.
On the Corn front tomorrow is First Notice Day on all July Grains and Brazil’s exports are booming with Brazilian ports on Wednesday were scheduled to ship 4.61 metric tons of Corn, up 1.2 million from a year ago. While here back in the U.S. the USDA confirms Silage Corn can be planted on Prevent Plant Acres. Following last weeks announcement about the potential to harvest cover crops on September 1st as opposed to November 1st, with many farmers, especially in the Upper Midwest started to wonder is Silage would be eligible which thank God was granted. Let’s face it folks we need all the help we can get with this worst crop in decades. Contributing to the story was Thomson Reuters and AGWEB Powered By Farm Journal. Farmers Business Network says Corn actual acres are down 10.3% from intentions. If this is applied to USDA data, that could translate to Corn Seedings of 83.2% million acres versus Prospective Seedings figure of 92.79 million acres. In the overnight electronic session the July Corn is currently trading at 443 ½ which is a ¼ of a cent higher. The trading range has been 445 ½ to 442 ¼. Still looking to buy any breaks in this market.
On the Ethanol front US Senators are urging the EPA to update Environmental Analysis on Ethanol to update what they call a nearly 10-year-old calculations of data that is outdated and ignores the technical advancements in Ethanol Production which should improve foreign sales opportunities. In the overnight electronic session there were no trades posted. The August contract settled at 1.583 and is currently showing 1 bid @ 1.581 and 2 offers @ 1.597 with Open Interest rising to 709 positions.
On the Crude Oil front after establishing gains pushing near $60 a barrel the market is trading lower in the overnight electronic session mostly due to rising to fast and furious with investors gladly taking smaller profits as in volatile markets it is better to eat like a bird than dump like an elephant and this is a profit taking business. We still have many issues both geo-politically and here in the U.S. with refinery issues when they will close down the Philadelphia refinery for repairs to the damage caused by the fire earlier this week. They are keeping the refinery running at half-speed and operational for the 4th of July weekend. Inventories are tight and if the global economic gains continue to thrive we will see countries thirst for even more Oil. In the overnight electronic session the August Crude Oil is currently trading at 5908 which is 30 points lower. The trading range has been 5928 to 5861.
On the Natural Gas front we are higher ahead of the EIA Gas Storage data with the August contract currently trading at 2.288 which is 2 cents higher. The trading range has been 2.295 to 2.265. The Thomson Reuters poll with 19 analysts participating expect injections ranging from 90 bcf to 113 bcf, with the average build of 101 bcf and the median 100 bcf. This compares to the one-year build of 100 bcf and the five-year average increase of 70 bcf. The next couple of weeks we should see a power surge with air-conditioning units that will finally tap the Natural Gas market to energize those units working overtime in the excessive heat.
Have a Great Trading Day!
Questions? Ask Dan Flynn today at 312-264-4374