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 Dallas Fed Manufacturing Index at 9:00 A.M, Export Inspections at 10:00 A.M., 3-Month and 6-Month Bill Auction at 10:30 A.M., 2-Year and 5-Year Note Auction at 12:00 P.M. and a U.K. Bank Holiday after what most are claiming a successful end to the Brexit.
On the Corn Front March corn futures rose to new highs and there is a feeling there is more momentum following. Funds added on to existing longs Friday and traders main concern for the moment is rains expected in South America and will Argentina and Brazil get the rain they most definitely need, and traders will be watching weather in South America in the coming two months of their growing season. We also know the next two months will have a better handle on stocks on hand, with carryover, basically for domestic demand and how big the 2021 crop can we predict with orders continuing to resurface and buying more corn products. We have not seen this in seasons or decades the buying interest at this level. In the overnight electronic session, the march corn is currently trading at 452 ¾ which is 1 ¾ of a cent higher. The trading range has been 455 ½ to 451 ½.
On the Ethanol Front the EPA released data last week showing that more than 1.61 billion renewable identification number (RINs) were generated in November, up from 1.58 during the same time in 2019. More than 45.57 million D3 cellulosic biofuel RIN’s were generated in November, including 34.83 million generated for compressed renewable natural gas (RNG) by liquefied RNG domestic producers, 3.07 million for compressed RNG for importers, and 173,959 generated for cellulosic ethanol by domestic producers. The total D3 RIN generation for the first 11 months of 2020 reached 4122.84 million. The volume includes 315.2 million generated for compressed RNG by domestic producers, 66.98 million generated for liquified RNG by domestic producers , 18.35 million generated for compressed RNG by importers, 10.32 million generated for liquified RNG by importers and 1.99 million generated for ethanol by domestic producers. In the overnight electronic session, the April ethanol posted a trade at 1.450 which was unchanged. The market is currently showing 3 bids @ 1.400 with 0 Offers and Open Interest at 40 contracts.
On the Crude Oil Front the futures have been edging and steadily moving higher when the seasonal cycle usually trends to profit-taking and long liquidation before the Christmas holidays. We see this market buck the trend because of COVID-19 vaccines, the stimulus package being signed even as a bad deal to the Americans that had a stake in the game deserving whatever they could get but the politicians had to take that away as well,
and finally, the OPEC+ agreement to start talks on overall production to start 2021 on the right foot. In the overnight electronic session, the February crude oil is currently trading at 4880 which is 57 points higher. The trading range has been 4896 to 4750.
On the Natural Gas front warmer weather forecasts for January triggered GAP lower opening prices. I really can’t fathom this continuing to do a complete free fall, but the bears have the bulls for the moment, and we may have some technical damage to the charts. In the overnight electronic session, the February natural gas is currently trading at 2.304 which is .0208 lower. The trading range has been 2.357 to 2.265.
Have A Great Trading Day!