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 day with Market Composite, Manufacturing and Services PMI Flash at 8:45 A.M., Michigan Consumer Sentiment, Michigan Inflation Expectations, Michigan 5.Year Inflation, Michigan Current Conditions Final and Michigan Consumer Expectations at 9:00 A.M., Kansas FED Manufacturing Index at 10:00 A.M. Baker Hughes Rig Count at 12:00 P.M., Cattle on Feed and Cold Storage at 2:00 P.M. On the Corn front, China dismissed the news story that the talks broke down. Chinese President Xi was quoted “we want to work for a Phase 1 agreement on the basis of mutual respect and equality”. Strong talk as to why the tariffs went into place in the first place. Unbalanced trade and hijacking of Intellectual Property (IP) are what these talks are all about. And the U.S. has been dealt a hand that was very bad and now it is going to change. President Xi Jinping went on to say that Beijing wants a trade deal with the U.S. but is not afraid to “fight back”, and he was further quoted, “as always we do not want to start a trade war with the U.S., but we are not afraid”, Xi said, “when necessary we will fight back but we have been working actively to try not have a trade war”. For the U.S. it now comes down to principal, we should seek out other customers and not have all of our eggs in one basket. The weather has not been helpful to finishing harvest. In the overnight electronic session the December Corn is currently trading at 367 ½ which is 1 cent lower. The trading range has been 369 to 367 ½.
On the Ethanol front, the American Coalition of Ethanol re-elected five officers to serve in 2020. There were no trades posted in the overnight electronic session. The December Ethanol settled at 1.416 and is currently showing 1 bid @ 1.410 and 1 offer @ 1.427 with Open Interest dropping to 148 contracts. Next week we will roll and start covering the January contract.
On the Crude Oil front, Iran raised Gasoline prices and the citizens are outraged as U.S. sanctions are crippling this terrorist nation and the citizens may just have an uprising with despair of how the regime seems more intent to be a power and no concern for its own people. The regime is desperate and we could see them target a western target which is why the U.S.S. Abraham Lincoln carrier strike force is in the region and could rapidly deploy. The market has eased off in the overnight electronic session. I would not want to be short going into the weekend because investors are realizing that there are tight global supplies and the risk on factor is on in the Middle-East. In the overnight electronic session, the January Crude Oil is currently trading at 5838 which is 20 points lower. The trading range has been 5851 to 5806.
On the Natural Gas front, we’re getting a pop with cold temperatures on the way. In the overnight electronic session, the December Natural Gas is currently trading at 2.607 which is 4 cents higher. The trading range has been 2.611 to 2.557.
Have a Great Trading Day!
Questions? Ask Dan Flynn today at 312-264-4374