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 US Trade Balance, Exports, and Imports at 7:30 A.M., Redbook YoY at 7:55 A.M., RCM/TIPP Economic Optimism Index at 9:10 A.M., NY Fed Treasury Purchases 0 to 1 yrs. at 9:30 A.M., EIA Short Term Energy Outlook and 10-Year Note Auction at 11:00 A.M., API Energy Stocks and LMI Logistics Managers Index at 3:30 P.M., and Day1 of FOMC Meetings.
Wholesale egg prices peaked in late February at a historic $8.53/dozen after more than doubling in price in just 12 weeks. At the peak, the market was 232% higher than the previous year. Since the peak, wholesale egg prices have fallen 56% to $3.72/dozen. Monthly retail prices have been slow to adjust to the expanded volatility seen at the wholesale level but have been trending higher year-over-year. The last consumer price report showed that the national average retail price in March had risen to a record high of $6.23/dozen, a 108% increase over 2024. It’s doubtful that the downturn in wholesale prices will show in the retail price data by the June report. The egg market has peaked with support below $3/dozen.
Crud Oil Drops on Large Supplies:
Spot WTI crude posting new 4-year lows at $57.20/barrel on Monday acts as a weight on corn & soybean oil. Corn and soybean oil at current prices no longer hold meaningful value relative to the energy market and in the case of soybean oil the burden of finding demand continues to be pushed into the export market. EIA data in recent months has made it clear biodiesel’s soybean oil demand draw will be down sizably year-over-year without EPA guidance on future tax credits. And cuts to EPA’s budget do not bode well for expanded mandated fuel volumes. CBOT soybean oil above $.51/pound is rich. Corn $4.60 is aligned with its longer-term average. The lack of clarity over US biofuel policy as well as new trade deals keep in place Ag Resources (ARC’s) strategy of selling weather-based rallies. However used cooking oil (UCO) from China has completed ended which is expected to lift soybean oil’s use as future feedstock.
US Weather Pattern Update
Central US Forecast Favorable for Planting; Drought to Hold Across Central/Western Plains:
US row crop planting is set to accelerate into mid-May. Normal/above normal temps blanket the Central US on a sustained basis beginning May 10th . Virtually zero rain is forecast across the Central Plains and principal Corn Belt throughout the next 10 days. The EU model’s 10-day forecast shows dryness which will be welcomed in MO, southern IN, and KY. National corn & soybean seeding progress is forecast to surpass 60-65% completed on May 15th, there are some regions that already surpassed 90%. Confidence in long-range forecast is low, but the EU and GFS agree that moderate rainfall returns to the eastern Plains and Midwest from May 17-20. If realized, this mix of rain and sun will promote well above-average early-season crop ratings. Rain will be needed west of the Mississippi River eventually, but not until late May will markets focus will shift from planting dates to yield. The crop is off to a favorable early start.
Corn Comments & Analysis
CBOT Corn Collapse on Falling Energy Prices; Fas US Seeding; Brazilian Market Seasonally Weak:
Long liquidation dominated CBOT corn futures on Monday. Fresh bullish fuel was absent. US planting will near completion by May 20th, and Brazilian prices continues to erode as the safrinha belt there avoided major weather issues as private crop estimates reach upwards of 130+ MMT’s, vs. USDA’s projected 126. July corn in Brazil settled at $4.89/Bu, vs. a peak of $5.45 in mid-April. US corn exports will face keen competition by July. The ’25 US corn crop on Sunday was 40% planted vs. 29% on average. ARC forecast another 20-22% of the crop will be seeded this week amid an absence of Midwest precipitation. Normal pollination & harvest dates are implied for the 2025 US crop. Market focus has shifted due to the swelling of global supplies if N Hemisphere weather threats are avoided. Speedy US planting has been digested. Downside is limited in the near term at $4.50, July, and $4.35, Dec. However, December futures shed another 30-50 cents of weather premium if Mother Nature cooperates. Recoveries will be sold with weather rallies, providing the next chance for new sales.
Have A Great Trading Day!
Contact me with any questions or to open a trading account at 1-888-2664-5665 or dflynn@pricegroup.com
Energy & Food Prices in Retreat. The Corn & Ethanol Report 05/06/2025
We kickoff the day with US Trade Balance, Exports, and Imports at 7:30 A.M., Redbook YoY at 7:55 A.M., RCM/TIPP Economic Optimism Index at 9:10 A.M., NY Fed Treasury Purchases 0 to 1 yrs. at 9:30 A.M., EIA Short Term Energy Outlook and 10-Year Note Auction at 11:00 A.M., API Energy Stocks and LMI Logistics Managers Index at 3:30 P.M., and Day1 of FOMC Meetings.
Wholesale egg prices peaked in late February at a historic $8.53/dozen after more than doubling in price in just 12 weeks. At the peak, the market was 232% higher than the previous year. Since the peak, wholesale egg prices have fallen 56% to $3.72/dozen. Monthly retail prices have been slow to adjust to the expanded volatility seen at the wholesale level but have been trending higher year-over-year. The last consumer price report showed that the national average retail price in March had risen to a record high of $6.23/dozen, a 108% increase over 2024. It’s doubtful that the downturn in wholesale prices will show in the retail price data by the June report. The egg market has peaked with support below $3/dozen.
Crud Oil Drops on Large Supplies:
Spot WTI crude posting new 4-year lows at $57.20/barrel on Monday acts as a weight on corn & soybean oil. Corn and soybean oil at current prices no longer hold meaningful value relative to the energy market and in the case of soybean oil the burden of finding demand continues to be pushed into the export market. EIA data in recent months has made it clear biodiesel’s soybean oil demand draw will be down sizably year-over-year without EPA guidance on future tax credits. And cuts to EPA’s budget do not bode well for expanded mandated fuel volumes. CBOT soybean oil above $.51/pound is rich. Corn $4.60 is aligned with its longer-term average. The lack of clarity over US biofuel policy as well as new trade deals keep in place Ag Resources (ARC’s) strategy of selling weather-based rallies. However used cooking oil (UCO) from China has completed ended which is expected to lift soybean oil’s use as future feedstock.
US Weather Pattern Update
Central US Forecast Favorable for Planting; Drought to Hold Across Central/Western Plains:
US row crop planting is set to accelerate into mid-May. Normal/above normal temps blanket the Central US on a sustained basis beginning May 10th . Virtually zero rain is forecast across the Central Plains and principal Corn Belt throughout the next 10 days. The EU model’s 10-day forecast shows dryness which will be welcomed in MO, southern IN, and KY. National corn & soybean seeding progress is forecast to surpass 60-65% completed on May 15th, there are some regions that already surpassed 90%. Confidence in long-range forecast is low, but the EU and GFS agree that moderate rainfall returns to the eastern Plains and Midwest from May 17-20. If realized, this mix of rain and sun will promote well above-average early-season crop ratings. Rain will be needed west of the Mississippi River eventually, but not until late May will markets focus will shift from planting dates to yield. The crop is off to a favorable early start.
Corn Comments & Analysis
CBOT Corn Collapse on Falling Energy Prices; Fas US Seeding; Brazilian Market Seasonally Weak:
Long liquidation dominated CBOT corn futures on Monday. Fresh bullish fuel was absent. US planting will near completion by May 20th, and Brazilian prices continues to erode as the safrinha belt there avoided major weather issues as private crop estimates reach upwards of 130+ MMT’s, vs. USDA’s projected 126. July corn in Brazil settled at $4.89/Bu, vs. a peak of $5.45 in mid-April. US corn exports will face keen competition by July. The ’25 US corn crop on Sunday was 40% planted vs. 29% on average. ARC forecast another 20-22% of the crop will be seeded this week amid an absence of Midwest precipitation. Normal pollination & harvest dates are implied for the 2025 US crop. Market focus has shifted due to the swelling of global supplies if N Hemisphere weather threats are avoided. Speedy US planting has been digested. Downside is limited in the near term at $4.50, July, and $4.35, Dec. However, December futures shed another 30-50 cents of weather premium if Mother Nature cooperates. Recoveries will be sold with weather rallies, providing the next chance for new sales.
Have A Great Trading Day!
Contact me with any questions or to open a trading account at 1-888-2664-5665 or dflynn@pricegroup.com
Thanks,
Dan Flynn
Questions? Ask Dan Flynn today at 312-264-4374