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 Fed Bostic Speech at 6:30 A.M., Building Permits Prel, Building Permits MoM Prel, Housing Starts, Housing Starts MoM, Initial Jobless Claims, Philadelphia Fed Manufacturing Index, Continuing Jobless Claims, Jobless Claims 4-Week Average, Philly Fed Business Conditions, Philly Fed CAPEX Index, Philly Fed Employment, Philly New Orders, and Philly Fed Prices Paid at 7:30 A.M., EIA Natural Gas Storage at 9:30 A.M., EIA Crude & Products Stocks at 10:00 A.M., Fed Bostic Speech, 4-Week & 8-Week Bill Auction at 10:30 A.M., 15-Year & 30-Year Mortgage Rate at 11;00 A.M., Fed Bostic Speech at 11:05 A.M., 10-Year TIPS Auction at 12:00 P.M., and Dairy Products Sales at 2:00 P.M.
The National Association of Homebuilders monthly Housing Market Index showed an uptick in homebuilder’s optimism in January. The index jumped 7 points from January to mark the 2nd consecutive month higher and reached a 4-month high of 44. This was still the 5th consecutive month below 50, and overall reflects a pessimistic outlook, just not as dreary in the last 4-months. 30-Year mortgage rates fell below 7% in December and last week were 1.13%under the October high of 6.66%. Nevertheless, 31% of homebuilders reported cutting prices in January. Homebuilders were encouraged by the Fed’s recent comments on future rate cuts but still reported historically low traffic from prospective buyers. Corn remains weak as funds are short and all eyes are watching South American weather. The corn futures ended weaker for the 4th day. Lack of fresh input and/or headlines. Spot corn in Europe ended $0.2/Bu lower. Spot corn in Brazil ended $0.8/Bu higher. The market waits on Feb-Apr South American weather and it’s critical that export sales tomorrow are published at or above 40 Mil/Bu. Poor sales in recent weeks due to global holidays. A recovery is needed quickly. Brazilian weather leans favorable across major safrinha producing states Mato Grosso and Goias. Argentina lacks threats today, but has mentioned previously of coming dryness is important. Argentine corn planting progress with the crop is now planted in December and early January with peak pollination due in the next 30 days. Argentina’s early planted crop has begun pollination. Ag Resources (ARC) estimates funds are net short at 253,000 contracts. The market remains deeply oversold, waiting for a recovery piece 2023 production, and ARC’s work maintains that a Brazilian crop of 114-116 MMT’s is a big deal.
Look Out Below— Bear Trap. The Corn & Ethanol Report 01/18/2024
We kickoff the day with Fed Bostic Speech at 6:30 A.M., Building Permits Prel, Building Permits MoM Prel, Housing Starts, Housing Starts MoM, Initial Jobless Claims, Philadelphia Fed Manufacturing Index, Continuing Jobless Claims, Jobless Claims 4-Week Average, Philly Fed Business Conditions, Philly Fed CAPEX Index, Philly Fed Employment, Philly New Orders, and Philly Fed Prices Paid at 7:30 A.M., EIA Natural Gas Storage at 9:30 A.M., EIA Crude & Products Stocks at 10:00 A.M., Fed Bostic Speech, 4-Week & 8-Week Bill Auction at 10:30 A.M., 15-Year & 30-Year Mortgage Rate at 11;00 A.M., Fed Bostic Speech at 11:05 A.M., 10-Year TIPS Auction at 12:00 P.M., and Dairy Products Sales at 2:00 P.M.
The National Association of Homebuilders monthly Housing Market Index showed an uptick in homebuilder’s optimism in January. The index jumped 7 points from January to mark the 2nd consecutive month higher and reached a 4-month high of 44. This was still the 5th consecutive month below 50, and overall reflects a pessimistic outlook, just not as dreary in the last 4-months. 30-Year mortgage rates fell below 7% in December and last week were 1.13%under the October high of 6.66%. Nevertheless, 31% of homebuilders reported cutting prices in January. Homebuilders were encouraged by the Fed’s recent comments on future rate cuts but still reported historically low traffic from prospective buyers. Corn remains weak as funds are short and all eyes are watching South American weather. The corn futures ended weaker for the 4th day. Lack of fresh input and/or headlines. Spot corn in Europe ended $0.2/Bu lower. Spot corn in Brazil ended $0.8/Bu higher. The market waits on Feb-Apr South American weather and it’s critical that export sales tomorrow are published at or above 40 Mil/Bu. Poor sales in recent weeks due to global holidays. A recovery is needed quickly. Brazilian weather leans favorable across major safrinha producing states Mato Grosso and Goias. Argentina lacks threats today, but has mentioned previously of coming dryness is important. Argentine corn planting progress with the crop is now planted in December and early January with peak pollination due in the next 30 days. Argentina’s early planted crop has begun pollination. Ag Resources (ARC) estimates funds are net short at 253,000 contracts. The market remains deeply oversold, waiting for a recovery piece 2023 production, and ARC’s work maintains that a Brazilian crop of 114-116 MMT’s is a big deal.
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Questions? Ask Dan Flynn today at 312-264-4374Daniel Flynn