Corn Freefalls In Weak Holiday Grain Markets. The Corn & Ethanol Report

We started off the day with MBA Mortgage Applications (21/MAY) and MBA 30-Year Mortgage Rate at 6:00 A.M., Fed Quarles Speech at 9:00 A.M., EIA Energy Stocks at 9:30 A.M., 2-Year FRN Auction at 10:30 A.M., 5-Year Note Auction at 12:00 P.M., Dairy Product Sales and Fed Quarles Speech at 2:00 P.M.

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On the Corn front, analysts are sparring as to the reason we had a one-month low in such a short period of time. Some say the top is in and I say no way. This selloff was due to plantings ahead of schedule and much-needed rain when the Drought Index bells and whistles were going off, warning what was to come next with no rain. We will be seeing significant moisture in the coming days after seeing near to none. After a busy week, overall China stopped buying on Friday and so far, this week. They most surely want to see a further drop in prices as their purchases are far from over. Analysts must remember it is not what you plant but what you grow. You can have all the acreage you want but who gives a hoot in hell if it will not produce yields. With South America’s crop not looking so strong and a weakened carryover market, margins are thin, and not a lot of margins for error to fall back on this growing season. And it is way too early in the growing season to call for a top. In the overnight electronic session, the July corn is currently trading at 623 ¼ which is 3 cents higher. The trading range has been 626 ¾ to 617 ¼.

On the Ethanol front, a study by the U.S. Department of Energy (DOE) and Argonne National Laboratory revealed that corn for ethanol is reducing the carbon footprint and greenhouse gases. The study recently published in Biofuels, bioproducts, and Biorefining, analyzes corn for ethanol production in the United States from 2005 to 2019 when production more than quadrupled. Scientists assessed corn for ethanol greenhouse gas (GHG) emission intensity or carbon intensity (CI) found a 23% reduction in CI’s. There were no trades posted in the overnight electronic session. The June ethanol settled at 2.350 and is currently showing no market with Open Interest at 21 contracts.

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