Federal Government Seizes First Republic Bank & Sold To J.P. Morgan. The Corn & Ethanol Report 05/01/2023

We kickoff the month of May with S&P Global Manufacturing PMI Final at 8:45 A.M., ISM Manufacturing PMI, ISM Manufacturing Employment, ISM Manufacturing Prices, ISM Manufacturing Prices and Construction Spending at 9:00 A.M., Export Inspections at 10:00 A.M., 3-Month & 6-Month Bill Auction at 10:30 A.M., Cotton System, Fats & Oils, and Grain Crushings at 2:00 P.M., and Crop Progress at 3:00 P.M.

On the Corn Front US corn seeding is estimated at 20 to 24%, the seeding is just below the 5-Yaer Average. Ongoing dryness across Central Brazil should be closely monitored with 72-76% of their corn is yet to pollinate. The drying trend started 10 days ago and looks to persist well into mid Ma. The Brazilian corn crop needs at least another 3 to 4 shots of rain into maturity. Central Us forecast warm with dry weather this week followed by widely scattered showers in the week 2 forecast that includes the Central and Southern Plains drought areas. Spring planting will surge ahead with the warmer forecast with crop emergence to quicken. The only concern is flooding in the Northern Plains and Upper Midwest that will take 6 to 9 days to retreat. The forecast shows Great Lakes Low Pressure vortex slowing pushing east and north into Thursday, which will allow for the Western Midwest and Plains  to hold a dry weather profile with temperatures warming following today. Instability showers will persist for a few more days across the Eastern Lake States with rainfall accumulations mostly less than 7 inches. Temps remain cool under cloud cover with 40’s/50’s. The Fed Decision on rates will be this Wednesday at 1:00 P.M. The street is expecting the Fed will raise a ¼ of a point and weening off on rising in the future. First Republic Bank was seized by the US government and sold to J.P. Morgan in the 2^nd largest bank failure on record. The auction sale on the weekend was to head off a chaotic collapse of the bank and reignite the US banking crisis in March. In the overnight electronic session the July corn is currently trading at 582 which is 3 cents lower. The trading range has been 585 ½ to 577 ½.

On the Ethanol Front Joe Holleman reporter for the St. Louis Post-Dispatch reported Illinois congresswoman praises waiver to allow summer sale of E15 ethanol. On Friday US rep. Nikki Budzinski (D-Il) applauded the Biden administration to allow E15 ethanol to be sold in the summer between June 1^st and September 15^th. Budzinski said the use of more-corn potion “reduce our dependence on foreign oil, supports good-paying jobs, and saves consumers at the gas pump.” Budzinski, whose central Illinois district that includes parts of St. Clair and Madison counties, is a co-sponsor of a bill to sell E15 al year long. Last year, Missouri Gov. Mike Parson, a Republican, praised a similar waiver in 2022 and urged the federal government to allow E15 sales all year, something that had been allowed in the Trump administration. There were no trades or open interest in ethanol futures.

Have An Excellent Trading Day!

Dan Flynn

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