Feeling The Green Today. The Corn & Ethanol Report 05/19/2023

We kickoff the day with Fed Williams Speech at 7:45 A.M., Fed Bowman Speech at 8:00 A.m., Fed Chair Powell Speech at 10:00 A.M., Baker Hughes Oil & Total Rig Count at 12:00 P.M., Cattle on Feed and Milk Production at 2:00 P.M.

On the Corn Front Existing Home Sales for April were reported at 4.28 million homes, falling short of the average trade estimate of 4.295 million and below March sales of 4.43 million. Compared to a year ago, sales were down 23%, marking the 21^st consecutive decline and the 11^th consecutive month of double digit year-over-year declines. The weekly Mortgage Bankers Report on Wednesday showed their Mortgage Application Index was down 33% from last year, with the average 30-Year home mortgage interest rate increasing to a 9-week high of 6.57% or 1.08% higher than a year ago. These numbers tell me I am with the farmers and want to see higher prices for corn. Let’s face it farmers need to cover their cost and with runaway inflation and spending this administration economy is showing that they will not stop anytime soon. If we have a financial Armageddon they will still spend on trivial projects to further their agenda or if they beat it to death they will regulate it. In yesterday’s action prices rebounded from the lows and had a mixed close. Crop Progress overall, favorable weather and weak demand are driving the bears. Funds seemed quiet yesterday, however, they were busy Wednesday adding to their net-short position. The US drought monitor showed cropland area in drought continues to shrink. Rain is forecasted in the next 5 to 7 days for the US southern plains where there is a very important need for moisture. In the overnight electronic session the July corn is currently trading at 557 ¾ which is 2 ½ cents higher. The trading range has been 559 ½ to 551 ½.

On the Ethanol Front news after Summit’s announcement it will make sustainable aviation fuel with Honeywell traveled fast. Navigator Heartland Greenway on Thursday announced a deal with electro fuels provider Infinium to provide 600,000 tons of carbon dioxide a year from ethanol plants connected to Navigator’s proposed pipeline. The CO2 would be used to create low-carbon fuels at a “future Infinium facility” in the Mid-west, Navigator said in a news release. “We are committed to delivering long-term, sustainable decarbonization solutions from our growing Heartland Greenway platform, and it’s exciting to see Infinium’s innovated approach to leverage carbon,” Navigator CEO Matt King said in a prepared statement. “This agreement serves as a great example of how we can help our partners optimize their carbon usage and minimize emissions while maximizing value.” Navigator, a Texas company, is proposing a 1,300 mile pipeline that would pass through 36 Iowa counties, including Linn, Benton, Cedar, Delaware, and Iowa. Carbon dioxide from ethanol and fertilizer plants would be under pressure, turned into liquid and piped to a site in south-central Illinois, where it would be injected more than a mile underground. Navigator has said it would sequester 7 million to 8 million metric tons of CO2 a year when the pipeline becomes operational and up to 15 million tons a year at full capacity. The 600,000 tons proposed by Infinium is about 8.5% of early totals. Reported by Erin Jordan with the Gazette. 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