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 N.Y. Empire State Manufacturing Index at 7:30 A.M., Export Inspections and Fed Kaplan speech at 10:00 A.M., Fed Daly Speech, 3-Month & 6-Month Bill Auction at 10:30 A.M. NOPA Crush at 11:00 A.M., Crop Progress, Overall Net Capital Flows, Foreign Bond Investment, and Net Long-Term Tic Flows at 3:00 P.M.
On the Corn front we are still seeing a weak overall export market, narrow trading ranges, continued fund selling and lack of farmer selling at these price levels, which pretty much summarizes Fridays trading action. We start the week with cooler than normal temperatures and on Turn-Around Tuesday we will see the mercury rising and possibly hit 90 degrees by Wednesday in most of the Corn Belt with intermediate rains which should be conducive to a healthy strong crop as we get the Crop Progress data later today. In the overnight electronic session the July corn is currently trading at 328 ½ which is 1 and a ½ of a cent lower. The trading range has been 330 to 328.
On the Ethanol front Alex Snodgrass with Independent Commodity Intelligence Services (ICIS) has sources telling him that ethanol producer Flint Hills Resources is permanently closing its 120m gal/year ethanol plant in Camilla, Georgia. The plant has been idle since May as the coronavirus hampered fuel ethanol demand. While the fuel ethanol is seeing some recovery, it still remains 20-30% lower than last year. Fuel ethanol producers have seen little to no margins for some time, forcing many to idle or cut production. Ethanol is used for gasoline blend stock , in pharmaceuticals and in food and beverage applications, such as hand sanitizers and Vodka. There has been smaller than usual ethanol commodity participation as well. There were no trades posted in the overnight electronic session. The July contract settled at 1.198 and is currently showing 1 bid @ 1.127 and 1 offer @ 1.240 with Open Interest at 72 contracts.
On the Crude Oil front the market continues to decline from the $39 and change levels recently seen, due to the fears of another wave of the coronavirus pandemic. This also has weakened the Stock Market in Friday and this mornings action. Despite production cuts the market is twitching an eerie feeling for fuel demand to keep increasing given the thought of states retreating on opening up on lock downs. In the overnight electronic session the July crude oil is currently trading at 3496 which is 130 points lower. The trading range has been 3612 to 3436.
On the Natural Gas front the market continues a steady to lower pattern with continued weakness with the global glut among other fundamentals we spoke about. We expect to see new selling or sellers on the sidelines unless there is a spike in prices or the bottom drops out which some analysts predicting this is the next commodity to go into negative territory and most likely will not recover as quickly as the crude oil market has. In the overnight electronic session the July natural gas is currently trading at 1.736 which is .005 higher. The trading range has been 1.761 to 1.714.
Have A Great Trading Day!