Higher & Higher Prices With No End In Sight. The Corn & Ethanol Report 08/29/2022

We kickoff the day with Dallas Fed Manufacturing Index (Aug) at 9:30 A.M., Export Inspection at 10:00 A.M., 3-Month & 6-Month Bill Auction at 10:30 A.M., Fed Brainard Speech at 1:15 A.M., and Crop Progress at 3:00 P.M.

On the Corn Front the USDA forecast lower yields in Kentucky for corn and soybeans., while Tennessee there is growing concerns about Ear Rot and Mycotoxin Management and an Illinois field reports plenty of pests and late season diseases. Also Illinois reports overall good yields, high grain prices lead to strong earnings. While Ohio corn is still in vegetive stages and questions remain if it will make it to maturity. We were higher Friday based on the Pro Farmer Tour. The Tour estimated corn yields were below in six states including Ohio, Indiana, Illinois, Iowa, Nebraska, and South Dakota. In the overnight electronic session the December corn is currently trading at 670 ½ which is 6 ¼ cents higher. The trading range has been 674 ¾ to 666 ¼.

On the Ethanol Front RFA calls California’s zero emission vehicle rule disappointing. The California Air Resources Board on August 25^th approved a rule that aims to phase out the sale of new cars and light duty trucks with internal combustion engines by 2035.The Renewable Fuels Association is urging the state to pursue Technology-neutral, market based approaches to achieve reduction. The ethanol futures remain in drydock.

On the Crude Oil Front the Saudi’s aim to keep crude prices higher as recession and Iran loom. Saudi’s recent warning that OPEC+ could cut production sparked a rally in oil prices. Analysts say Saudi Arabia’s plan is simple: keep oil prices high so the kingdom can capture as much revenue as it can. “Market uncertainty has boosted prices, which is exactly what Saudi Arabia is looking to do,” said Morningstar’s Stephen Ellis. In the overnight electronic session the October crude oil is currently trading at 9403 which is 97 points higher. The trading range has been 9465 to 9229.

On the Natural Gas Front the EU faces awful winters without gas cap.  While the European Energy slumps as gas storage in Germany ahead of target and the IEA’s Birol says Russia likely to increase gas flaring as storages fill. Looks like the Biden administration was wrong again on Nord Steam 1 Pipeline. The September natural gas goes off the board today. In the overnight electronic session the October natural gas is currently trading at 9.187 which is 0.082 lower. The trading range has been 9.711 to 8.980.

Have A Great Trading Day!

Dan Flynn

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