Volatility Continues. The Corn & Ethanol Report 02/07/2022

We start off the week with LMI Logistics Managers Index Current (Jan) at 4:30 A.M., Export Inspections at 10:00 A.M., 3-Month & 6-Month Bill Auction at 10:30 A.M., and Consumer Credit at 2:00 P.M.

On the Corn Front South Korea’s NOFI seeks corn and feed wheat for May and June. While soybeans are leading the charge. And Brazil’s soybean harvest is 16% complete. We should not be surprised to see higher prices as we have seen costs in every crease and every crevice go up dramatically. We have USDA WASDE day on Wednesday. In the overnight electronic session the March corn is currently trading at 630 ½ which is 10 cants higher. The trading range has been 632 ½ to 624 ¾.

On the Ethanol Front last week representatives with US biofuels industry called on the EPA to abandon its plans to reduce the 2020 renewable volume obligation (RVO) and urged the agency to set strong RVO’s for 2021-22. A variety of groups, including those representing the ethanol industry, renewable natural gas (RNG) industry, and sustainable aviation fuel (SAF) producers were those among those who filed public comments regarding the agency’s proposed rule to revise the 2020 RVO and set long-overdue RVO’s for 2021-22. There were no trades or open interest in ethanol futures.

On the Crude Oil Front we are backing off in the early going.  Headlines about China’s economy in a slowdown and may cut demand, I believe is just a short-term ruse, we will see higher prices yet to come.  This headline is scaring off the bulls for the moment. Again, we are watching to see if Russia blinks. We also have API Energy Stocks tomorrow. In the overnight electronic session the March crude oil is currently trading at 9146 which is 85 points lower. The trading range has been 9273 to 9073.

On the Natural Gas Front the March natural gas continues to slide back on a warming outlook. As long as we have subfreezing air in certain areas should bolster demand in those areas from Feb, 13-17. In the overnight electronic session the March natural gas is currently trading at 4.296 which is 0.276 lower. The trading range has been 4.468 to 4.280.

Have A Great Trading Day!

Dan Flynn

Questions? Ask Dan Flynn today at 312-264-4374