Waiting For The Sun & Rain in South America. The Corn & Ethanol Report 01/17/2025

We kickoff the day with Building Permits Prel, Building Permits MoM Prel, Housing Starts, and Housing Starts MoM at 7:30 A.M., Industrial Production MoM & YoY, Manufacturing Production MoM & YoY, and Capacity Utilization at 8:15 A.M., Baker Hughes Oil & Total Rig Count at 12:00 P.M., Net Long term TIC Flows, Foreign Bond Investment, and Overall Capital Flows at 3:00 P.M.

UD Import prices in December rose 0.1% from November, marking the 3^rd consecutive month higher. Compared to a year ago, import prices were up 2.2%, marking  the largest annualized increase in 2 years. Import prices have now increased in 9 of the last10 months on a annualized basis. Fuel imports rose by 1.4% marking the largest 1-month increase since April, and were 0.3% higher than a year ago, marking the first annualized price increase since July. Nonfuel import prices rose 0.1% for the month, marking the 7^th consecutive month higher, led by increasing food, feed, and beverage import prices. The price index for exports rose 0.#% in December and were 1.8% higher than last year. Agriculture export prices rose 0.5% for the month but were 1.2% less than a year ago. Prices for non-agricultural industrial supplies were up 0.8% for the month, led by a 3.2% increase in fuel export prices. Both import and export prices remain well above the pre-pandemic lows, with export prices considerably higher. However, the US continues to run massive trade deficit as import volumes exceed exports by a large margin.

CBOT Corn Rally Fails at $4.80; US Exports Demand Becomes Routine:

CBOT corn ended weak, and the March CBOT’s inability to score new rally highs since Monday opens the market to a deeper correction if Argentine rain materializes as forecast this weekend. Similar to wheat & soybeans, the issue at current prices is a lack of Chinese buying. US export sales in the week ending Jan 9^th were a decent 40 Mil/Bu, but notice the pace of new demand has been near a year ago levels since December. Argentine premiums continue to erode, with large carry-in supplies thee buffer against modest yield loss due to dryness. It’s difficult to be bullish above $4.80 spot. A range of $4.40=$480 is forecast until Brazilian safrinha yields are better understood in spring. Await further corrections before adding to end user supply coverage.

Have A Great Trading Day!

 

Thanks,

Daniel Flynn

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