Cristobal Making Presence Known & Feared. The Corn & Ethanol Report

We kicked off the day with Challenger Job Cuts (May) at 6:30 A.M., Export Sales, Jobless Claims, and U.S. Trade Balance at 7:30 A.M., EIA Gas Storage at 9:30 A.M., 4-Week & 8-Week Bill Auction at 10:30 A.M. and Dairy Products at 2:00 P.M.

On the Corn front, we had mixed trade with tight ranges and light volume in yesterday’s action. Funds remain largely short and the market is looking at the basics of ethanol demand, (whether it grows or not) to base what type of yields we should expect. Exports from South America remain cheaper than the U.S. and with that hanging in the balance we have the cat and mouse game in the trade game with China. (Will they or Won’t they) still hanging in the balance and who else will come to the table in our export market. The tracking cone on Tropical Storm Cristobal is forecasting a direct landfall hit on the Louisiana coast. What can be expected so far is winds at 65 mph, 15 inches of rain and coastal surges as much as 6 feet above ground level The rains and winds will make its way to the Corn Belt early next week. This year has been predicted to be an active hurricane season and on Day 4 here we are. In the overnight electronic session the July Corn is currently trading at 325 ¾ which is 1 ¾ of a cent higher. The trading range has been 326 ½ to 324.

On the ethanol front, production climbed higher last week, this is the 5th week in a row. The EIA said that production averaged about 765,000 barrels a day, up 41,000 on the week for the highest average since March because of blending demand rising slowly as COVID-19 related restrictions relax, but were still down 279,000 barrels from a year ago. Ethanol stocks were down 700,000 barrels to 22.476 million, the tightest supply since the first week of the year and 77,000 barrels less than a year ago. There were no trades in the overnight electronic session. The July contract settled at 1.147 and is currently showing 1 bid @ 1.101 and 1 offer @ 1.170 with Open Interest at 119 contracts.

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