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
We kickoff the day with MBA 30-Year Mortgage Rate, MBA Mortgage Market Index, MBA Mortgage Market Refinance Index, MBA Purchase Index, MBA Mortgage Applications, New Home Sales, and New Home Sales MoM at 9:00 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., Fed Interest Rate Decision at 1:00 P.M., Fed Press Conference, Building Permits, and Building Permits MoM Final at 1:30 P.M., and Dairy Product Sales at 2:00 P.M.
On the Corn Front the futures open interest sank 4,757 contracts while traders are taking a safer play as options on futures grew 26,758 contracts. The day-to-day volatility is forcing traders into greater options positions. There have been no new attacks by Russia in the Southern Ukraine. There were reported blasts from sea mine surrounding Odessa last night. Traders are wary that there will be future bombardments forcing traders to use options on futures versus outright futures positions. And we add an expected ¼ point rate hike by the Fed today only adding to market volatility. Beyond that the US market is focused on exports, weather and yields. We still have miles to go to see what not only what Us farmers grew but what yields they produce. And we will have crop tours beginning to evaluate the crop in the next week and a half. In the overnight electronic session the December corn is currently trading at 557 ¾ which is 7 ½ cents lower. The trading range has been 565 to 554 ½.
On the Ethanol Front Archer Daniels Midland Co. (ADM) released yesterday strong results in the 2nd quarter for both ethanol and biodiesel operations. Robust margins for both types of biofuel are expected to continue into the second half of the year. “Biofuels demand continues to remain strong,” said Juan Luciano, chairman and CEO of ADM, during a second quarter earnings call. “Through the first half of the year, we saw robust margins from biodiesel, strong demand for ethanol and increasing demand for vegetable oil from renewable green diesel. “We expect these trends to continue in the second half.” Luciano continued the new soybean crushing facility under development in Spiritwood, North Dakota, is currently scheduled to begin operations during the fourth quarter of this year. The facility, is owned by a joint venture between ADM and Marathon Petroleum, will add 1.5 million metric tons of annual soy crush. There were no trades or open interest in ethanol futures. This story was provided by Erin Voegele with Ethanol producer Magazine.
Have An Excellent Trading Day!