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 start off Tuesday with Redbook MoM and YoY July at 7:55 A.M., Fed Bostic Speech at 8:00 A.M., IBD/TIPP Economic Optimism July and Jolts Job Openings May at 9:00 A.M., 119-Day and 42-Day Bill Auction at 10:30 A.M., Fed Quarles Speech and 3-Year Note Auction at 12:00 P.M., Fed Daly Speech and Fed Barkin Speech at 1:00 P.M., API Energy stocks at 3:30 P.M., and Total Vehicle Sales at 8:00 P.M.
On the corn front the USDA dropped their ratings on corn and soybeans. Corns good to excellent dropped to 71% dropping 2% from last weeks rating. Another reason the corn gained strength was corn silkings in major U.S. corn producing states of Iowa, Illinois, Indiana, and Nebraska is behind the five-year average. And of course weather will play a critical role in prices as the hot weather is supposed to hang around for a while with rains forecasted on Friday and the drought index is not at critical levels but this news was enough to have the shorts exit the market. There was a role reversal in the overnight electronic session with the December corn currently trading at 351 ½ which is 4 ¾ cents lower. The trading range has been 357 ½ to 350 ½.
On the Ethanol front Chicago Argo ethanol prices hit their highest level in seven months due to low inventories. A source quoted by S&P Global Platts, “If someone has ethanol they need it”. The source continued, “If you want to buy some ethanol, you are going to have to buy the offer.” In the overnight electronic session the August ethanol posted a traded at 1.350 which was .031 higher. The market is currently showing 1 bid @ 1.281 and 1 offer @ 1.395 with 1 contract traded and Open Interest at 75 contracts.
On the Crude Oil front we have the API Energy Stocks later today with expectations of draws of about 3 million barrels on crude and builds of about 1 million on distillates and gasoline. The market is in an area where it gets sluggish and backs off before buying the same real estate. In the overnight electronic session the August crude oil is currently trading at 4038 which is 25 tics lower. The trading range has been 4079 to 3990.
On the Natural Gas front the market saw more profit taking in yesterdays action. The heat dome is expected to be here for a while and we just saw investors banking profits and reentering and that also brought in fresh buying. In the overnight electronic session the August Natural Gas is currently trading at 1.912 which is .082 cents higher. The trading range has been 1.919 to 1.8219.
Have a Great Trading Day!