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
An electric car was disabled and stranded and the driver needed help. Several coal miners pushed the car to a coal mine and wallah the electric car was fired up. And coal miners get a bad rap, these were good guys. The electric car has not been perfected let alone have the infrastructure on our country’s roads. This is just another sign we need coal, crude and natural gas to cool and heat our homes. Solar and wind power is not going to cut it.
We start off the day with NFIB Business Optimism Index (Aug) at 5:00 A.M., CPI (Aug), Core Inflation Rate MoM & YoY (Aug), and Inflation Rate MoM & YoY (Aug) at 7:30 A.M. Redbook YOY Aug) at 7:55 A.M.,IBD/TIPP Economic Optimism (Sep) at 9:00 A.M., 30-Year Bond Auction at 12:00 P.M., Monthly Budget Statement (Aug) at 1:00 P.M., and API Energy Stocks at 3:30 P.M.
On the Corn Front the USDA lowered 2022 corn, Filed under: Arkansas Grains, harvest in Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri and Nebraska will be affected. The recent rains have not helped, most traders feel future prices are too low and way undervalued. Funds piled on their long positions by 106,691 contracts equivalent to 528 million bushels. Traders also expect funds to sell this rally during harvest. However, some traders like myself could see futures reach $9 to $10. I also do not believe, even with exports gradually on the rise, The US will not be able to fill the void left by South America and Ukraine. Tomorrow the September corn expires and is premium to the December which is evident as it moves to cash. In the overnight electronic session the December corn is currently trading at 697 which is 1 cent higher. The trading range has been 698 to 692 ½.
On the Ethanol Front the USDA dropped 2022/3 FSI 100 million bushels and corn to ethanol 50 Million bushels and exports 100 million bushels. If these numbers are correct the market will be in a quagmire.
The cash market remains active while the futures remain in drydock.
On the Crude Oil Front were moving higher on concerns over tight supplies. According to a story by Tsvetana Paraskova with OILPRICE.com the IEF and the S&P Global, the worlds fuel market will remain tight for years to come. One of the driving factors of the market tightness is the 3.8 million barrels per day of crude distillation capacity that has closed since 2020. Normally that would spur investment in new capacity but the current administrations war on energy has muted investment. In the overnight electronic session the October crude oil id currently trading at 8908 which is 138 points higher. The trading range has been 8931 to 8663.
On the Natural Gas Front the Green groups slams dem’s natural gas pipeline deal as a “betrayal” side deal that Mountain Valley Pipeline (MVP) a 304-mile West Virginia-to-Virginia is under construction. More bullish news leaked papers reveals the EU is unlike to cap price of Russian gas and regulation includes a wind fall tax on “surplus” profits from oil and gas. It gets from bad to worse the politicians blow it and the people pay more. In the overnight electronic session the October natural gas is currently trading at 8.333 which is 0.084 higher. The trading range has been 8.456 to 8.292.
Have A Great Trading Day!
Dan FlynnQuestions? Ask Dan Flynn today at 312-264-4374