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
Happy Columbus Day! The government remains shut down but the commodity markets and free markets are open. We do have a speech from Fed governor Paulson at 11:55 A.M.
The new hot commodity that is not as rare as advertised, is rare earth as AI has an overwhelming appetite for electric power. Which to stay competitive and a leader in AI, we will have to enlarge the US power grid exponentially. If you are old enough to remember the pressure put on the power grid when personal computers became a necessity versus a luxury. To compete at the highest level the US must expand mining and processing of rare earth minerals. This is a huge importance to National Security. The question is whether the US-China agricultural talks move forward, and rare earth most definitely will be included in these talks. If Trump does in fact meet with Xi. We must remember rare earth is not as rare as advertised. It is in our own back yard, it is no question a dynamic to National Security, US mining and processing is a must, having more infrastructure in place. Like the US oil market drill baby drill. However, we go back on the Fed’s slow moving actions on cutting or raising interest rates is another part of making the journey much harder than it has to be. The real estate market is cooler than what it should be, like a hot potato, other sectors are suffering revenue shortages with the Fed’s inaction.
Kansas City Federal Reserve’s quarterly energy survey showed continues stagnation in the 10th Districts energy sector. The Drilling/Business Activity Index in Q3 was down 16 points from Q2, with revenue and profit indeces at -24 and -29 points, respectively, and both were the weakest in 2 years. Employment also fell for the 2nd straight month, and hours of work deteriorated. Compared to a year ago, Drilling/Business Activity Index was down -24, the lowest in 4 quarters. Firms indicted that they need $63/barrel to break even and $78/barrel for a meaningful increase in production. Half of the firms delayed investment decisions slightly because of uncertainty, and another 25% have slowed significantly.
Central US Weather Pattern Update
Central US Stays Arid Next 10 Days; Models Indicate Better Rain Chances After Oct 20th:
As the Noreaster and Tropical Storms collided we will be watching further activity in the Atlantic and there is drought concern in the Corn Belt. The forecast is consistent in keeping rain into Oct 19-20 confined to the Dakotas and maybe pockets of NE, IA, and MN. Mild/dry conditions persist elsewhere. Model guidance remains hopeful that a wetter pattern shift has not been incorporated into the 10-day forecast. Harvests are moving along speedily, but there’s a growing risk to river logistics, which explains the early week rise in corn & soybean basis at export terminals. Draft restrictions are possible from Memphis southward after October 20th, and so the rush is on to fill Gulf elevators. A good soaking rain is needed east of the Mississippi River to improve river transportation.
Corn Comments & Analysis
Corn Drops Below Key Moving Average on Rising US-Chinese Geopolitical Tension:
CBOT corn ended weak and settled below its 50-day moving average for the first time in 30 days at $4.15. Support must be uncovered early this week or a test of $3.95-$4.05 during the glut slot of harvest. Finding cover for all of the US corn is becoming an issue with Plains dryland corn yields reported at double a year ago. Cash basis bids are weakening again as harvest advances. Any national yield above 179 BPA keeps intact the need to find 16 Bil Bu of demand in crop year 25/26. Every bushel of export feed and industrial consumption is needed, which in the long run requires competitive prices. South American fob values have been unmoved so far in October. Dalian corn in China fell to new multi-month lows at $7.53/Bu. Interior basis levels were mixed last week. River bids firmed rapidly amid the need to fill Gulf cargoes ahead of Mississippi River logistics. Basis at other major markets are sinking on the supply abundance. ARC’s strategy remains to leverage recoveries with forward sales March ’26 above $4.40 and Dec’26 above $4.70 are targeted. World feed markets are well supplied.
Have A Great Trading Day!
Contact me directly with any questions or open a trading account at 1-888-264-5665 or dflynn@pricegroup.com.
AI’s Energy Boom Sparks Rare Earth & National Security Issues. The Corn & Ethanol Report 10/13/2025
Happy Columbus Day! The government remains shut down but the commodity markets and free markets are open. We do have a speech from Fed governor Paulson at 11:55 A.M.
The new hot commodity that is not as rare as advertised, is rare earth as AI has an overwhelming appetite for electric power. Which to stay competitive and a leader in AI, we will have to enlarge the US power grid exponentially. If you are old enough to remember the pressure put on the power grid when personal computers became a necessity versus a luxury. To compete at the highest level the US must expand mining and processing of rare earth minerals. This is a huge importance to National Security. The question is whether the US-China agricultural talks move forward, and rare earth most definitely will be included in these talks. If Trump does in fact meet with Xi. We must remember rare earth is not as rare as advertised. It is in our own back yard, it is no question a dynamic to National Security, US mining and processing is a must, having more infrastructure in place. Like the US oil market drill baby drill. However, we go back on the Fed’s slow moving actions on cutting or raising interest rates is another part of making the journey much harder than it has to be. The real estate market is cooler than what it should be, like a hot potato, other sectors are suffering revenue shortages with the Fed’s inaction.
Kansas City Federal Reserve’s quarterly energy survey showed continues stagnation in the 10th Districts energy sector. The Drilling/Business Activity Index in Q3 was down 16 points from Q2, with revenue and profit indeces at -24 and -29 points, respectively, and both were the weakest in 2 years. Employment also fell for the 2nd straight month, and hours of work deteriorated. Compared to a year ago, Drilling/Business Activity Index was down -24, the lowest in 4 quarters. Firms indicted that they need $63/barrel to break even and $78/barrel for a meaningful increase in production. Half of the firms delayed investment decisions slightly because of uncertainty, and another 25% have slowed significantly.
Central US Weather Pattern Update
Central US Stays Arid Next 10 Days; Models Indicate Better Rain Chances After Oct 20th:
As the Noreaster and Tropical Storms collided we will be watching further activity in the Atlantic and there is drought concern in the Corn Belt. The forecast is consistent in keeping rain into Oct 19-20 confined to the Dakotas and maybe pockets of NE, IA, and MN. Mild/dry conditions persist elsewhere. Model guidance remains hopeful that a wetter pattern shift has not been incorporated into the 10-day forecast. Harvests are moving along speedily, but there’s a growing risk to river logistics, which explains the early week rise in corn & soybean basis at export terminals. Draft restrictions are possible from Memphis southward after October 20th, and so the rush is on to fill Gulf elevators. A good soaking rain is needed east of the Mississippi River to improve river transportation.
Corn Comments & Analysis
Corn Drops Below Key Moving Average on Rising US-Chinese Geopolitical Tension:
CBOT corn ended weak and settled below its 50-day moving average for the first time in 30 days at $4.15. Support must be uncovered early this week or a test of $3.95-$4.05 during the glut slot of harvest. Finding cover for all of the US corn is becoming an issue with Plains dryland corn yields reported at double a year ago. Cash basis bids are weakening again as harvest advances. Any national yield above 179 BPA keeps intact the need to find 16 Bil Bu of demand in crop year 25/26. Every bushel of export feed and industrial consumption is needed, which in the long run requires competitive prices. South American fob values have been unmoved so far in October. Dalian corn in China fell to new multi-month lows at $7.53/Bu. Interior basis levels were mixed last week. River bids firmed rapidly amid the need to fill Gulf cargoes ahead of Mississippi River logistics. Basis at other major markets are sinking on the supply abundance. ARC’s strategy remains to leverage recoveries with forward sales March ’26 above $4.40 and Dec’26 above $4.70 are targeted. World feed markets are well supplied.
Have A Great Trading Day!
Contact me directly with any questions or open a trading account at 1-888-264-5665 or dflynn@pricegroup.com.
Thanks,
Dan Flynn
Questions? Ask Dan Flynn today at 312-264-4374