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 with Export Sales, Initial Jobless Claims, Jobless Claims 4-Week Average, Continuing Jobless Claims and Philadelphia Fed Manufacturing Index at 7:30 A.M., CD Leading Index MoM May at 9:00 A.M., EIA Gas Storage at 9:30 A.M., 4-Week and 8-Week Bill Auction at 10:30 A.M., Fed Mester Speech at 11:15 A.M. 5-Year TIPS Auction at 12:00 P.M. and Milk Production.
On the Corn front traders have been weighing favorable weather forecast and better export numbers with rumors that China came in and bought shipments of Corn and Soybeans. There was also growth in ethanol production which started some short covering in yesterdays action. The 72-hour cumulative precipitation map from the NOAA is calling for wetter-than-average weather for the Central Plains and Western Corn Belt. The NOAA 8-14 day outlook has forecasted also wet but from June 24th to June 30th that dry weather will emerge in the Northern Plains. Even with continued fund selling in Tuesdays trading session, certain traders are hedging their bets by covering shorts and looking to sell more contracts at higher levels before Mondays USDA Crop Progress report. In the overnight electronic session the July Corn is currently trading at 332 ¾ which is 2 ½ cents higher. The trading range has been 333 ¾ to 329 ¼.
On the Ethanol front we traded a tad higher yesterday with production slightly higher and weekly ending stocks down 2%. It may look like baby steps, but recovery as small as it is, the market is starting in the right direction. The week ending June 12th marks the seventh consecutive week of growth following sharp declines that began in late March through April due to the impacts caused by the COVID-19 pandemic. Erin Voegele with Ethanol Producer Magazine contributed the data. There were no trades posted in the overnight electronic session. The July contract settled at 1.247 and the market is currently showing 1 bid @ 1.225 and 1 offer @ 1.260 with Open Interest dropping to 67 contracts.
On the Crude Oil front the API and EIA were, “A Tale Between Two Cities.” After a break to the downside in Tuesdays overnight after the API data the market recovered after a total different picture was painted by the EIA data yesterday. In the overnight electronic session the crude made it close to recent highs as there were several failed attempts to reach higher highs in Wednesdays trading session. It seems like the market wants to make new highs and eventually punch through $40 a barrel to really get investors attention. The July Crude Oil is currently trading at 3803 which is 7 tics higher. The trading range has been 3853 to 3711.
On the Natural Gas front we have the weekly EIA Gas Storage data and the Thomson Reuters poll with 18 analysts participating estimate builds ranging from 80 bcf to 90 bcf with the median injection build of 85 bcf. This compares to the one-year build of 103 bcf and the five-year average injection of 73 bcf. Make no mistake there is a bearish consensus in this market, but most likely we need to see a rally to attract more sellers to jump back into the fray. In the overnight electronic session the July natural gas is currently trading at 1.623 which is 1 ½ of a cent higher. The trading range has been 1.654 to 1.620.
Have A Great Trading Day!