Closing in on Hurricane & Summer Driving Season. The Corn & Ethanol Report 05/24/2023

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., EIA Energy Stocks at 9:30 A.M., 2-Year FRN Note Auction and 17-Week Bill Auction at 10:30 A.M., 5-Year Note Auction at 12:00 P.M., FOMC Minutes at 1:00 P.M., Cold Storage & Dairy Products Sales at 2:00 P.M.

On the Corn Front in the early going we are wearing our St. Patty’s Green. Ag report weather report showed GFS operational trend is wetter in the Eastern Corn Belt for a 12 to 14 day period. While, better performing EU model keeps Midwest dryness through June 8^th. The GFS operational model has added scattered and moderate rainfall to Iowa, Illinois, and Indiana June 6 to 7. But confidence is low that there will be precipitation. Watching the weather broadly stagnant upper air patterns will be in place in not the Central US only but much of the Northern hemisphere into the first week in June. As We are more weather sensitive at this time of the growing season it is forecasted there will be abnormal warmth to persist across Canada and the Northern and Western US where you are outing out fires and have more to go. Our prayers are with you. It is premature about growing conditions in the late spring, but close attention should be paid to soil moisture falls as meteorological summer approaches. Dry soil tends to promote bouts of extreme summer heat. I will continue to beat this saying like an old friend Tim Hannagan told me, ”It is not what you plant but what you grow,” I will continue with this phrase in this growing season as Mother nature makes it apropos. Export Sales tomorrow could be an interesting number. In the overnight electronic session the July corn is currently trading at 582 ¾ which is 5 ¼ cents higher. The trading range has been 583 ¼ to 574.

On the Ethanol Front a Michigan company that was a dairy vodka producer teamed up with a Canadian company to use dairy to vodka, to a whole new use for biofuels and ethanol. This reminds me during COVID how far ethanol has moved with hand sanitizers for one you wouldn’t think of everyday. They will be joining forces with dairy industry as ethanol margins remain high, ingenuity and investors become intrigued with other innovations. Unfortunately, the excitement does not spillover to the ethanol futures with no trades and zero open interest.

Have A Great Trading day!

Dan Flynn

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