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 the day with Unemployment at 7:30 A.M., Baker Hughes Rig- Count at 12:00 P.M., We have 3 more Disturbances the Atlantic and two pose a threat into the Gulf region. It is still too early to judge their path, but we will be trading risk on or risk off in this long weekend.
On the Corn Front China continues to buy in a seller’s market. Prices are cheap but demand is growing and should drive futures prices higher. Looking at exports and feed, (Feeder cattle) you will see the prices climb. Funds still remain net long as net stocks globally have diminished, and demand is growing. We should see a surge in commodities prices. There are plenty of analyst that have said there is plenty of corn, but consumption, feed and human consumption, we are looking at bushels per acre, and what all the forecasters are predicting, we may be in for a surprise. And Brazil or Argentina will not be able to meet the shortfall. Domestically we know the Derecho and Drought regions have hurt the number 1 producer of corn in decades. After the crop yours and USDA told us, can Illinois, Indiana, Wisconsin, and Nebraska fill the void. Apparently, that is why we are seeing prices go higher in the Labor Day Weekend, which we would normally seasonably harvest pressure. In the overnight electronic session, the December corn is currently trading at 358 ½ which is 4 ¾ cents higher. The trading range has been 359 ¼ to 343 ¾.
On the Ethanol front corn prices will spill over into this market as well. What makes one commodity tic has other commodities related move in the same direction. There were no trades posted in the overnight electronic session. The October ethanol settled at 1.306 and is currently showing 1 bid @ 1.090 and 1 offer @ 1.350 with Open interest at 43 contracts.
Have a Safe & Fun Labor Day Weekend!
And Go at it again on Tuesday!
Have a Great Trading Day!