We kicked off the day with MBA 30-Year Mortgage Rate, MBA Mortgage Market Index, MBA Mortgage Refinance Index, MBA Purchase Index, and MBA Mortgage Applications at 6:00 A.M., Balance of Trade, Exports & Imports at 7:30 A.M., EIA Energy Stocks at 9:30 A.M., 17-Week Bill Auction at 10:30 A.m., Consumer Credit Change, Dairy Products Sales,, and Used Car Prices MoM & YoY at 2:00 P.M.

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The only reason these inflationary prices are in the tank is global recession fears. Basic fundamentals are right before our eyes and that includes self-inflicted wounds by this current administration. Meanwhile, weather modules stay erratic but the EU and GFS models agree rainfall in the eastern US, in Tennessee and Kentucky, while concerns of soil moisture loss will continue across the Eastern Plains and principal Midwest. The yield concerns, which is too early to call is adding to the market fluctuations and volatility. Wholesale beef prices are at historic high levels, pork prices are in the tank, and chicken values are in the middle. Corn to ethanol gasoline usage, feed, and human consumption are concerns as we trade this supply and weather market. The weak export market is not only Brazil’s strong export market, but are magnified by loading delays and delays at Chinese ports. This is another bad sign when China will be a buyer in the US market. We are currently a tad higher on July corn with the deferred months lower. In the overnight electronic session the July corn is currently trading at 608 ½ which is a ½ of a cent higher. The trading range has been 611 ½ to 604 ½.

On the Ethanol front Michael Grunfeld, a columnist for Canary Media, who is working on a book about how to feed the world without frying it. He wrote an Opinion to the editor, making common sense, as America rushes to generate more renewable electricity, it has become fashionable to worry that solar and wind farms take up too much land. He continued, it is fairly well-known that farm-grown fuels like corn ethanol and soy diesel accelerate food inflation and global hunger, but also a disaster for the climate and environment. In short closing, what makes corn-based ethanol distinct from most of our other wasteful agriculture giveaways is that diverts crops from bellies to fuel tanks and uses almost as much fossil-fuel – from fertilizers made of natural gas to diesel tractors, industrial refineries and other sources as the ethanol replaces. DO THE MATH! There were no trades or open interest in ethanol futures.

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