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 U.S. Trade Balance (AUG), U.S. Exports (AUG), and U.S. Imports (AUG) at 7:30 A.M., JOLTs Job Openings (AUG) at 9:00 A.M., Fed Chair Powell Speech at 9:40 A.M., 119-Day and 42-Day Bill Auction at 10:30 A.M., Fed Harker Speech at 11:00 A.M., 3-Year Note Auction and 52-Week Bill Auction at 12:00 P.M., API Energy Stocks at 3:30 P.M., and Fed Kaplan Speech at 5:00 P.M.
On the Hurricane Front Tropical Depression Gamma is expected to produce heavy rainfall over portions of southeast Mexico, while Hurricane Delta looks to be a monster currently moving west-northwest at 7 knots. Tropical Storm Warnings are in effect for the Cayman Islands from late Monday. Hurricane delta is expected to include dangerous storm surge, wind, and rainfall hazards along the Louisiana Coast to the Florida Panhandle beginning Thursday night or Friday.
On the Corn Front the harvest is moving is moving faster than average with many producers more focused on soybean harvest which was at 38%, while corn harvest was at 25%, compared to the average of 24%. While 87% of the crop is mature, compared to 78% and 62% of the corn was rated 62% good-to-excellent, up 1% from last week. The next USFA Crop Production estimates will be Friday October 9th. Traders still believe there should be another wave of Chinese buying and Mexico should stay a steady purchaser. In the overnight electronic session, the December corn is currently trading at 381 ¼ which is 1 ¾ of a cent higher. The trading range has been 381 ¼ to 378 ½.
On the Ethanol front while the industry sees the lowest stocks on hand since 2016, Pacific Ethanol stock rose 12.5% in yesterday’s action. According to Rich Smith with Motley Fool, he explains, investors were scared and watched for additional details of President Trumps illness, he tweeted around 1:00 A.M. on Friday. All we know for certain is the President has been treated with a “kitchen sink” load of coronavirus remedies- everything from antibody “cocktail” to antivirals and steroids. And another certainty Smith points out, people are going to be more nervous now, and they’re going to be more conscientious about wearing masks, washing hands, disinfecting surfaces, and sanitizing hands in the future. This company made a remarkable comeback during this pandemic , making other uses of ethanol more widespread. The next corn use for ethanol statistics will be Friday October 9th. There were no trades posted in the overnight electronic session. The November contract settled at 1.360 and is currently showing 2 bids @ 1.341 and 1 offer @ 1.360 with Open Interest at 68 contracts.
On the Crude Oil Front, we have the API Energy Stocks later today and the question at the moment is, will Hurricane Delta, with the forecasted threatening approach be enough to push spot crude oil over $40 a barrel? I would say that is a safe bet considering the deferred months are there or above. In the overnight electronic session, the November crude oil is currently trading at 3975 which is 53 points higher. The trading range has been 3978 to 3910.
On the Natural Gas Front, here is another case of risk on, with dangerous storm surge, winds, and heavy rainfall hazards with the storm bearing down the entire coast of Louisiana not to mention parts of Texas across the Florida Panhandle, rigs offshore have already been disrupted this active hurricane season And now from refineries stretching from Lake Charles, Louisiana to Henry Hub, we are talking a lot of refineries that could see damage And traders will be watching how quick these repairs can be made from pipelines, refineries and shipping just to name a few. In the overnight electronic session the November natural gas is currently trading at 2.686 which is .071 higher. The trading range has been 2.698 to 2.618.
Have a Great Trading Day!