Vanquish Inflation Turn On The Spigot In North America. The Corn & Ethanol Report 06/32/2022

We kickoff the day with Current Account Q1, Initial Jobless Claims (18/Jun), Jobless Claims 4-Week Average (18/Jun) and Continuing Jobless Claims (11/Jun) at 7:30 A.M., S&P Composite PMI Flash (Jun), S&P Global Manufacturing PMI Flash (Jun) and S&P Global Services PMI Flash at 8:45 A.M., Fed Chair Powell Testimony at 9:00 A.M., EIA Natural Gas Stocks at 9:30 A.M. $-Week and 8-Week Bill Auction at 10:30 A.M., 5_Year TIPS Auction at 12:00 P.M>, Cold Storage and Dairy Products Sales at 2:00 P.M. and Fed Bank Stress Test Results at 3:30 P.M.

On the Corn Front we closed mixed in yesterday’s action with fears of demand decline and higher inflation haunting the market. And with a complete freeze on Ukraine/Black Sea exports and a drought in Brazil, Throw in the US is facing a drought and will have a questionable 2022 growing season. There is fear amongst farmers and traders in every commodity , but most of all to the energy and grain sector which is the sparkplug to our existence. In the overnight electronic session the July corn is currently trading at 758 ½ which is 9 ½ cents lower. The trading range has been 767 ¼ to 752 ½.

On the Ethanol Front this market and the cash market is flying while ethanol futures remain dormant. The Fuels Institute published a new white paper that discusses the benefits of biofuels.  Meanwhile ACTO Ingredients announce in June that it had received a $22.7 million cash grant from the USDA’s Biofuel Producer Program which provided $700 million in relief to biofuels companies who experienced losses due to COVID19.

On the Crude Oil Front the volatility continues as the fears in this market continues as fears with government at war with the US energy sector, especially more importantly will effect production and how these 1970’s refineries manage capacity. The sanctions the US put on is not stopping the Putin War Machine where they are exporting to China and India and happy to receive fuel at a discount. It is time to battle inflation and open up Anwar, the Keystone Pipeline XL, offshore drilling and make the Permian Basin competitive again. Instead of government controls and regulations so energy companies can invest in our future and  banks will invest in theirs then paying higher energy across the board. In the overnight electronic session the August crude oil is currently trading at 10636 which is 16 points higher. We have a 4 Handle trading range of 10671 to 10232.

On the Natural Gas Front this market joined the rest of the energy sector to do the limbo due to existence and global economy. We do have the EIA data at 9:30 A.M. And the Thomson Reuters poll with 13 analysts participating estimate injections ranging from 56 bcf to 79 bcf with the median increase of 66 bcf. This compares to the one-year injection of 73 bcf which matches the Five-year average pegged at 73 bcf. In the overnight electronic session the July natural gas is currently trading at 6.742 which is 0.116 lower. The trading range has been 6.840 to 6.657.

Have A Great Trading Day!

Dan Flynn

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