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
Another Crop Progress report has come and gone and weather pressured the Grains last night. I do not underestimate the American Farmer but I must remind everyone, “it is not what you plant but what you grow”. And we most definitely will be scouring acreage and yields and what have we have grown in the past decade, I cannot see this crop even close to the average. And more bearish news have the Grains in the red this morning with the December Corn currently trading at 437 which is 6 ¾ cents lower. The trading range has been 443 ½ to 435 ½. News flashes from some of my boots on the ground saw central Illinois had certain Corn & Soybean fields that looked right on track to where they should be this time of year but not far away the crops were behind and others dismal. We may get a dose of the doctor’s prescription on Thursdays Crop Production USDA Supply/Demand data.
On the Ethanol front there were no trades posted in the overnight electronic session. The August contract settled at 1.521 with the market currently showing 2 bids @ 1.475 and 2 offers @ 1.516 with Open Interest at 673 contracts.
On the Crude Oil we have the API Energy Stocks today at 3:30 P.M. also in the news Fuel Makers (Refineries) launched an ad in a Michigan newspaper which was a swing state that President Trump promised a win-win energy policy for all Americans, but also was quoted unchecked Ethanol mandates are “Job Killers”. And the man is right but many refineries do not want to blend more Corn Based Ethanol if any. We must give him credit getting the manufacturing back to the Good Ol USA and it is flourishing despite his biggest critic Barack Obama said, “manufacturing is gone in America and it will never come back, does this guy think he has a magic wand?” Well Barack whatever it took he got it to work in less than two years in office! We still look to geo-political risks with the free flow of global commerce with the usual suspects and the Saudi’s along with other OPEC nations with Russia and Non-OPEC nations standing firm on production cuts which should support higher prices. The word on the street is to expect draws and overall bullish numbers on tonight’s inventory data. In the overnight electronic session the August Crude Oil is currently trading at 5804 which is 38 points higher. The trade range has been 5819 to 5729. James Bullard is scheduled to speak today and we will see if he will come across more dovish after a great Jobs number on Friday and manufacturing steadying out after fantastic gains.
On the Natural Gas front the market is eyeing the storm that is headed into the Gulf of Mexico which some investors could deem as demand destruction if the storms damage and cause major power outages.
The heat is on and could give a needed boost in prices weather premium could add up if the temps stick around for a while. In the overnight electronic session the August Natural Gas is currently trading at 2.383 which is 2 cents lower. The trading range has been 2.404 to 2.370.
Have a Great Trading Day!
Questions? Ask Dan Flynn today at 312-264-4374