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 Non Farm Payrolls, Unemployment Rate, Average Hourly Earnings MoM & YoY, Participation Rate, Average Weekly Hours, Government Payrolls, and U-6Employment Rate at 7:30 A.M., Baker Hughes Oil & Total Rig Count at 12:00 P.M., Consumer Credit Change and Used Car Sales MoM & YoY at 2:00 P.M.
The June International Trade Report showed that the US trade deficit decreased by 55% to $61.6 billion. It was the smallest trade deficit in 19 months, marking the largest decline in the deficit since February 1992. Imports fell by 16% from march to a 6-month low of $351 billion, led by declines in pharmaceutical preparations, finished metal shapes, passenger cars, cell phones, and other household goods. Exports rose by 3% to a record large $289 billion, led by sales of finished metal shapes, non-monetary gold, and computers. The most significant deficit was with China at $19.7 billion, but down from $48 billion in March. The trade deficit with the EU fell to 17.9 billion, down from 48 billion in March. The Vietnam deficit widened to $14.5 billion from $14 billion in March. The sharp drop in the trade deficit in April looks to boost Q2 GDP.
Central US Weather Pattern Update
Central US Forecast Lacks Dryness through June 20th; Temps Near to Below Normal:
The Central US forecast remains as 3-5 days of dryness is unlikely to last. The EU and GFS models differ on extended range details, but both allow for regional showers to return to the Plains and Midwest after June 12th. Attention will be paid to precipitation amounts & locations in the second half of June as the forecasts evolve, but the dominate theme is that a sustained/anchored central US high-pressure Ridge is unlikely. The absence of heat is noted. And soaking rain lingers into the weekend across the Southern Plains TN/KY, southern IN and OH. This week’s drought monitor featured improvements in soil moisture across the Plains and deterioration in IA and IL. Severe drought drought coverage is minimal, and any development of abnormal dryness will be slow if current 10-day forecasts are verified. Even Iowa will see needed rain in the next 24 hours, which helps rebuild soil moisture reserves.
South American Weather Pattern Update
South American Corn Harvest Uninterrupted Next Two Weeks:
The South American forecast has improved , as helpful showers replenish moisture in southern Brazil during wheat planting while complete dryness elsewhere allows for a smooth and accelerated corn harvest. Dryness occurs where it is needed. The Argentine corn harvest is 44% complete this week and is projected to reach 52-55% completion by June 15th. The speedy Argentine harvest has pressured fob prices and allowed Argentine corn to be the world’s cheapest feed grain. Safrinha corn harvest in Mato Grosso will reach 4-5% complete through Friday, and it will accelerate in the second half of June. Cash corn markets will globally sort out the coming influx of South American corn supply with weaker cash basis bids.
Corn Comments & Analysis
CBOT Corn Ends Steady/Higher for Third day; Shorts Being Covered Amid US/China Trade Deal Optimism:
CBOT corn futures uncovered support near the late autumn lows, while improved precipitation is required in the Black Sea and China. No yield has been lost in either Black Sea/China during June. The extended-range forecast is promising better rainfall for the Northern Plains of China while the Black Sea stays arid. In the Central US, it must stop raining before any drought fears become realistic. President Trump spoke with Chinese President Xi, the tals were cordial and regarding the Geneva trade pact are back on, and talks of rare earth minerals were one of many hot topics of the conversation. It’s worthwhile for China to extend trade talks to prevent a hike in US tariff rates. The industry is awaiting a date to restart talks which are most likely set and may have already begun. New lows are not expected until July weather issues are avoided; A US/China trade deal will return China as a US soybean importer. China’s corn import need is far less. 2.0 Bil in 25/26 US end stocks correlates with a market sub $4.00 December corn at harvest. Target $4.50+, Dec CBOT to add 20-30%to forward sales. The Central US forecast is favorable into late June. It is then about excessive July temperature.
Have A Great Trading Day!
Contact me directly with any questions or to open a trading account at 1-888-264-5665 or email dflynn@pricegroup.com
Tariff’s Charging Deficit Declines-US/China Trade Deal Optimism. The Corn & Ethanol Report 06/06/2025
We kickoff the day with Non Farm Payrolls, Unemployment Rate, Average Hourly Earnings MoM & YoY, Participation Rate, Average Weekly Hours, Government Payrolls, and U-6Employment Rate at 7:30 A.M., Baker Hughes Oil & Total Rig Count at 12:00 P.M., Consumer Credit Change and Used Car Sales MoM & YoY at 2:00 P.M.
The June International Trade Report showed that the US trade deficit decreased by 55% to $61.6 billion. It was the smallest trade deficit in 19 months, marking the largest decline in the deficit since February 1992. Imports fell by 16% from march to a 6-month low of $351 billion, led by declines in pharmaceutical preparations, finished metal shapes, passenger cars, cell phones, and other household goods. Exports rose by 3% to a record large $289 billion, led by sales of finished metal shapes, non-monetary gold, and computers. The most significant deficit was with China at $19.7 billion, but down from $48 billion in March. The trade deficit with the EU fell to 17.9 billion, down from 48 billion in March. The Vietnam deficit widened to $14.5 billion from $14 billion in March. The sharp drop in the trade deficit in April looks to boost Q2 GDP.
Central US Weather Pattern Update
Central US Forecast Lacks Dryness through June 20th; Temps Near to Below Normal:
The Central US forecast remains as 3-5 days of dryness is unlikely to last. The EU and GFS models differ on extended range details, but both allow for regional showers to return to the Plains and Midwest after June 12th. Attention will be paid to precipitation amounts & locations in the second half of June as the forecasts evolve, but the dominate theme is that a sustained/anchored central US high-pressure Ridge is unlikely. The absence of heat is noted. And soaking rain lingers into the weekend across the Southern Plains TN/KY, southern IN and OH. This week’s drought monitor featured improvements in soil moisture across the Plains and deterioration in IA and IL. Severe drought drought coverage is minimal, and any development of abnormal dryness will be slow if current 10-day forecasts are verified. Even Iowa will see needed rain in the next 24 hours, which helps rebuild soil moisture reserves.
South American Weather Pattern Update
South American Corn Harvest Uninterrupted Next Two Weeks:
The South American forecast has improved , as helpful showers replenish moisture in southern Brazil during wheat planting while complete dryness elsewhere allows for a smooth and accelerated corn harvest. Dryness occurs where it is needed. The Argentine corn harvest is 44% complete this week and is projected to reach 52-55% completion by June 15th. The speedy Argentine harvest has pressured fob prices and allowed Argentine corn to be the world’s cheapest feed grain. Safrinha corn harvest in Mato Grosso will reach 4-5% complete through Friday, and it will accelerate in the second half of June. Cash corn markets will globally sort out the coming influx of South American corn supply with weaker cash basis bids.
Corn Comments & Analysis
CBOT Corn Ends Steady/Higher for Third day; Shorts Being Covered Amid US/China Trade Deal Optimism:
CBOT corn futures uncovered support near the late autumn lows, while improved precipitation is required in the Black Sea and China. No yield has been lost in either Black Sea/China during June. The extended-range forecast is promising better rainfall for the Northern Plains of China while the Black Sea stays arid. In the Central US, it must stop raining before any drought fears become realistic. President Trump spoke with Chinese President Xi, the tals were cordial and regarding the Geneva trade pact are back on, and talks of rare earth minerals were one of many hot topics of the conversation. It’s worthwhile for China to extend trade talks to prevent a hike in US tariff rates. The industry is awaiting a date to restart talks which are most likely set and may have already begun. New lows are not expected until July weather issues are avoided; A US/China trade deal will return China as a US soybean importer. China’s corn import need is far less. 2.0 Bil in 25/26 US end stocks correlates with a market sub $4.00 December corn at harvest. Target $4.50+, Dec CBOT to add 20-30%to forward sales. The Central US forecast is favorable into late June. It is then about excessive July temperature.
Have A Great Trading Day!
Contact me directly with any questions or to open a trading account at 1-888-264-5665 or email dflynn@pricegroup.com
Thanks,
Dan Flynn
Questions? Ask Dan Flynn today at 312-264-4374