It’s All About WASDE & Poor Economy. The Corn & Ethanol Report 05/10/2023

We kickoff the day with MBA 30-Year Mortgage Rate, MBA Mortgage Market Index, MBA Mortgage Refinance Index, MBA Purchase Index and MBA Mortgage Applications at 6:00 A.M. Core Inflation Rate MoM & YoY, Core Inflation Rate MoM & YoY, CPI s.a., and CPI at 7:30 A.M., EIA Energy Stocks at 9:30 A.M., 17-Weeke Bill Auction at 10:30 A.M., 10-Year Note Auction at 12:00 P.M., Monthly Budget Statement at 1:00 P.M., and Dairy Products Sales at 2:00 P.M.

On the Corn Front  futures followed up with short speculators not willing to give up the ship! And for good reason, the US economy is painfully pitiful. The global economy is not better or worse. The ols adage of traders in the grain and oil patch used to pan, If the US sneezes the rest of the FREE world will Catch a cold.”  Bullish news is around us on fundamental grain prices but with continued negative economic data and news from the current administration tells traders different. Friday’s WASDE Report will weigh heavily on the markets, and I not see speculative shorts heading to the exits anytime soon. Preliminary CBOT open interest showed a gain of 3,659 contracts in soybeans and 9,823 contracts of corn, while Chicago wheat open interest declined 1,468 contracts. It seems to me that spec shorts have not taken the pedal off the metal just yet. Today we will see how far the bear push continues as we get closer to Friday’s numbers. In the overnight electronic session the July corn is currently trading at 581 ½ which is 3 ¼ cents lower. The trading range has been 587 to 579.

On the Ethanol Front the renewable Fuels Association, Growth Energy and American Coalition for Ethanol and are calling on the US EPA to recognize the carbon reduction benefits of ethanol in its proposed rule to set multi-pollutant emissions standards for model year (MY)2027 and later light-duty and medium-duty vehicles. Yes the Environmental Protection Agency (EPA) or appointees that were not elected into office sets the mandate and the rules point men setting the narrative. I think the EPA should remember the P stands for protection. One of many cases in point, the Gold King Mine toxic spill in the Animas River was started and caused by the EPA watchdogs. These failed mandates will be felt for generations. We will have ethanol production and stocks tomorrow. There were no trades or open interest in ethanol futures.

Have A Great Trading day!

Dan Flynn

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