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 this day, and hopefully do not realize a Turnaround Tuesday as the markets continue to advance in the midst of this pandemic. God willing we will be back to as close to normal as possible. We have U.S. Housing Starts & Permits at 7:30 A.M., Redbook (MoM) & (YoY) at 7:55 A.M., Fed Chair Powell Testimony at 9:00 A.m., 42-Day and 119-Day Bill Auction at 10;30 A.M., 52-Week Bill Auction at 12:00 P.m., Fed Rosengren Speech at 1:00 P.M. followed by the American Petroleum Industry (API) energy Stocks at 3:30 P.M.
On the corn front the Crop Progress showed that corn was 80% planted with Illinois 84% done. We will be watching events unfold to see if there was any frost damage from last week and the verdict will be out shortly and the possibility of replanting this early. We have had our share of rain and the mercury is slowly climbing. In the overnight electronic session the July Corn is currently trading at 321 ½ which is ¾ of a cent higher. The trading range has been 321 ½ to 320 ½.
On the ethanol front the Supreme Court announced it has denied a petition filed by Valero Energy Corp. asking the court to determine whether the U.S. EPA is required to consider petitions that change the point of obligation under The Renewable Fuel Standard. Valero Energy Corp. and Petrochemical Manufacturers filed the petition with the Supreme Court on December 30th,2019, asking the court to determine whether the EPA is required to consider petitions to change the point of obligation under the RFS. The petition argued that the Clean Air Act’s RFS program requires the EPA to undertake annual renewable volume obligations (RVOs) for the U.S. transportation fuel supply and states that the first three elements is to determine the point of obligation. The EPA admits that it initially placed the point of obligation on refineries and importers, but not for blenders, for reasons of administrative convenience. Valero and AFPM said in the petition asking the court to determine whether the requirement the EPA ‘shall’ make a ‘calendar year’ determination of the ‘appropriate’ point of obligation. The court handed down the decision yesterday and the petition was denied. There were no trades posted in the overnight electronic session. The July ethanol settled at 1.086 and is currently showing 3 bids @ 1.060 and 2 offers @ 1.136 with Open Interest dropping to 239 contracts.
On the Crude Oil front the market came to life as news of a vaccine had stars in the eyes of demand investors and they were doing back flips. The demand and also production cuts really lit a fire in this market, And if we have any sort of draws in tonight’s API data , “Katy Bar the Door!” In the overnight electronic session the July Crude is currently trading at 3184 which is 19 points higher. The trading range has been 32291 to 3113.
On the Natural Gas front the market is riding the bullish wave as well with the unexpected increase of demand brought this market back from the abyss. In the overnight electronic session the June natural gas is currently trading at 1.828 which is 4 ½ cents higher. The trading range has been 1.841 to 1.763.
Have a Great Trading Day!Questions? Ask Dan Flynn today at 312-264-4374