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 Redbook YoY at 7:55 A.M., Fed Barkin & Fed Bostic Speech at 8:00 A.M., Fed Collins Speech at 8:30 A.M., Fed Musalem Speech at 12:00 P.M., API Energy Stocks at 3:30 P.M., Fed Kugler Speech at 4:00 P.M., Fed Daly & Fed Hammack Speech at 6:00 A.M.
Last week’s Illinois Production Cost Report from the USDA showed that Illinois farm diesel prices for the week ranged from $2.69-$2.94/gallon, while the average price was quoted at $2.78. This was up a penny from May, but $.58 cheaper than a year ago. Nearby MYMEX diesel futures briefly dipped under $2/gallon in early May but traded as high as $2.20 last week. Note that the farm basis has widened since the start of the year, as farm-delivered prices have not followed futures lower. Seasonally, futures tend to forge a low in early May and then gently strengthen into late summer, followed by a strong rally in the 4th quarter as demand for heating oil seasonally increases. The US economy benefits from cheaper energy prices, but the EIA is expected to use further weakness in energy prices to restock the Strategic Petroleum Reserve further any additional weakness in diesel prices can be used to book summer and harvest fuel needs.
Central US Weather Pattern Update
Central US Cool/Wet Nxt 10-Days; No Concern for Spring Drought:
Midwest drought concerns continue to be eased, if not eliminated . If any, the US weather pattern into June 2nd is too wet. The EU, GFS, and AI models have added moderate to heavy rainfall to the mid-South and southern Midwest in the 8-15 day period. There will be no shortage of water come June, but the coming lack of sunshine and cool temps – with lows in the upper 40’s & 50’s – will slow row crop emergence/growth. The EU model’s latest two-week precipitation forecast has totals upward of 4-10” will impact large parts of eastern KS, MO, AR, & TN. Totals of 2-4” will dot the principal Corn Belt. Drought stays confined to NE, SD, and W IA. Rain makes grain but the tail end of Corn & soybean planting will be challenged. Newly emerged crops along the southern corn/soybean belt must contend with excess water and ponding. Shallow rooted crops will need regular rainfall this summer. Norther Chinese wheat crop is in trouble arid temperatures and drought concerns with average temperature readings in the next 48 hours with max temp readings 93-102 degrees which is affecting 70% of the crop. With current trade talks with agriculture on the radar with host of other demands on the US side, US farmers could benefit with wheat exports depending on the severity of China’s drought.
Corn & Soybean Seasonal Price Trends
This years crop base price was $4.70, up 4 cents from 2024 and above the 10-year average of $4.49. The price index reflects long-term average price trend during the growing season from May1 to August 31, measuring December corn futures are often above the crop insurance priced in the first half of May. However, it ‘s not uncommon for December futures to trade under the insurance price in the first half of the month. In fact, in the last decade, December corn futures have started the month of Maty below the insurance price in 5 years. Since revenue crop insurance 13 of the last 24 years. Also chart notes that new crop corn prices typically forge a seasonal high by mid-June. It takes a tremendous weather event to get new base price in soybeans was established at $10.54 this year, down $1.01 from a year ago and below the 10-year average of $10.92. The price index chart shows that like corn, the soybean market often starts the month of May about 2% above the crop insurance base price. This year, November soybeans began the month about 3% below that price. But again, it’s not uncommon for new crop soybean price to start the growing season under the crop insurance price in 5 years, and in the last 24 years have been below the base price in 9 years have in early May. The average seasonal high in November soybeans has been less pronounced than in corn due to the seasonal difference in the plant’s reproductive cycles, and soybeans greater sensitivity to August weather. However, soybean rallies beyond mid-July are less common and always driven by widespread heat/dryness.
Corn Comments & Analysis
CBOT Corn Recovers; US Planting Slows Next 10-14 Days
CBOT Corn futures ended higher as early season supply pressure has been digested, and the remainder of the US crop will be planted more slowly. The US crop was 78% planted on May 18th – right at market expectations. For million acres are not planted in IL, KY, MO, and TN, which amid this week’s rain, will not be seeded until June or the acres will be enrolled in prevent plant. 1.3 Mil acres is also unplanted today across ND, which is close to the prevent plant date enrollment. Ag Resources (ARC_ doubts this is enough to change market sentiment or production potential entirely. Still at, $4.30-$4.40 December futures, producer selling will be limited/nonexistent. The US farmer is bullish of cash corn into pollination. US corn export inspections in the week ending May 15th totaled 68 Mil Bu, vs. 48 Mil the same week a year ago. Record Mexican demand is set to persist besides improving showers. ARC sees July bound to a range of $4.40-$4.70 and Dec at $4.30-$4.55 into mid-June & when Mother Nature determines the next lasting trend. The strategy remains to sell rallies. A turnaround Tuesday is probable, but new lows require certainty on 2025 US corn yield or the US/China trade deal.
Have A Great Trading Day!
Contact me directly with any questions or to open a trading account at 1-888-264-5665 or dflynn@pricegroup.com
Rising Exports-Supplies-Trade Deals & Weather. The Corn & Ethanol Report 05/20/2025
We kickoff the day with Redbook YoY at 7:55 A.M., Fed Barkin & Fed Bostic Speech at 8:00 A.M., Fed Collins Speech at 8:30 A.M., Fed Musalem Speech at 12:00 P.M., API Energy Stocks at 3:30 P.M., Fed Kugler Speech at 4:00 P.M., Fed Daly & Fed Hammack Speech at 6:00 A.M.
Last week’s Illinois Production Cost Report from the USDA showed that Illinois farm diesel prices for the week ranged from $2.69-$2.94/gallon, while the average price was quoted at $2.78. This was up a penny from May, but $.58 cheaper than a year ago. Nearby MYMEX diesel futures briefly dipped under $2/gallon in early May but traded as high as $2.20 last week. Note that the farm basis has widened since the start of the year, as farm-delivered prices have not followed futures lower. Seasonally, futures tend to forge a low in early May and then gently strengthen into late summer, followed by a strong rally in the 4th quarter as demand for heating oil seasonally increases. The US economy benefits from cheaper energy prices, but the EIA is expected to use further weakness in energy prices to restock the Strategic Petroleum Reserve further any additional weakness in diesel prices can be used to book summer and harvest fuel needs.
Central US Weather Pattern Update
Central US Cool/Wet Nxt 10-Days; No Concern for Spring Drought:
Midwest drought concerns continue to be eased, if not eliminated . If any, the US weather pattern into June 2nd is too wet. The EU, GFS, and AI models have added moderate to heavy rainfall to the mid-South and southern Midwest in the 8-15 day period. There will be no shortage of water come June, but the coming lack of sunshine and cool temps – with lows in the upper 40’s & 50’s – will slow row crop emergence/growth. The EU model’s latest two-week precipitation forecast has totals upward of 4-10” will impact large parts of eastern KS, MO, AR, & TN. Totals of 2-4” will dot the principal Corn Belt. Drought stays confined to NE, SD, and W IA. Rain makes grain but the tail end of Corn & soybean planting will be challenged. Newly emerged crops along the southern corn/soybean belt must contend with excess water and ponding. Shallow rooted crops will need regular rainfall this summer. Norther Chinese wheat crop is in trouble arid temperatures and drought concerns with average temperature readings in the next 48 hours with max temp readings 93-102 degrees which is affecting 70% of the crop. With current trade talks with agriculture on the radar with host of other demands on the US side, US farmers could benefit with wheat exports depending on the severity of China’s drought.
Corn & Soybean Seasonal Price Trends
This years crop base price was $4.70, up 4 cents from 2024 and above the 10-year average of $4.49. The price index reflects long-term average price trend during the growing season from May1 to August 31, measuring December corn futures are often above the crop insurance priced in the first half of May. However, it ‘s not uncommon for December futures to trade under the insurance price in the first half of the month. In fact, in the last decade, December corn futures have started the month of Maty below the insurance price in 5 years. Since revenue crop insurance 13 of the last 24 years. Also chart notes that new crop corn prices typically forge a seasonal high by mid-June. It takes a tremendous weather event to get new base price in soybeans was established at $10.54 this year, down $1.01 from a year ago and below the 10-year average of $10.92. The price index chart shows that like corn, the soybean market often starts the month of May about 2% above the crop insurance base price. This year, November soybeans began the month about 3% below that price. But again, it’s not uncommon for new crop soybean price to start the growing season under the crop insurance price in 5 years, and in the last 24 years have been below the base price in 9 years have in early May. The average seasonal high in November soybeans has been less pronounced than in corn due to the seasonal difference in the plant’s reproductive cycles, and soybeans greater sensitivity to August weather. However, soybean rallies beyond mid-July are less common and always driven by widespread heat/dryness.
Corn Comments & Analysis
CBOT Corn Recovers; US Planting Slows Next 10-14 Days
CBOT Corn futures ended higher as early season supply pressure has been digested, and the remainder of the US crop will be planted more slowly. The US crop was 78% planted on May 18th – right at market expectations. For million acres are not planted in IL, KY, MO, and TN, which amid this week’s rain, will not be seeded until June or the acres will be enrolled in prevent plant. 1.3 Mil acres is also unplanted today across ND, which is close to the prevent plant date enrollment. Ag Resources (ARC_ doubts this is enough to change market sentiment or production potential entirely. Still at, $4.30-$4.40 December futures, producer selling will be limited/nonexistent. The US farmer is bullish of cash corn into pollination. US corn export inspections in the week ending May 15th totaled 68 Mil Bu, vs. 48 Mil the same week a year ago. Record Mexican demand is set to persist besides improving showers. ARC sees July bound to a range of $4.40-$4.70 and Dec at $4.30-$4.55 into mid-June & when Mother Nature determines the next lasting trend. The strategy remains to sell rallies. A turnaround Tuesday is probable, but new lows require certainty on 2025 US corn yield or the US/China trade deal.
Have A Great Trading Day!
Contact me directly with any questions or to 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