Unemployment & Cristobal: A Tropical Depression - The Corn & Ethanol Report

We start off Friday, June 5, with Unemployment data for May at 7:30 A.m., Baker-Hughes Rig Counts at 12:00 P.M., and Consumer Credit at 2:00 P.M.

On the Corn front, many markets are watching the movements of the Cristobal storm front, and tracking the projected landfall and the impact it will leave in its path. The weather did spark some fund short covering, and corn settled higher in yesterday’s action. We will see how far this rally rides before enticing some farmers to sell.

Cash corn prices fell on the Illinois River yesterday at Seneca and Morris, but rose slightly on the Mississippi River at Savanna, Illinois. A Cincinnati, Ohio elevator weakened bases from $0.09/bushel to $0.05 over July futures, while a Burns Harbor, Indiana elevator raised bases from $0.02/bushel to $0.13 below July futures prices.

In the overnight electronic session, the July corn is currently trading at 329 ¾, which is ¾ of a cent higher. The trading range has been 330 to 328 ¼.

On the Ethanol front, there is an update from Sens. Chuck Grassley and Joni Ernst (R-Ia), as they announced they will continue to push the Food and Drug Administration (FDA) to provide a needed flexibility for ethanol producers working to help the U.S. overcome shortages of hand sanitizer during the COVID-19 pandemic.

While we see production rising, we would like to see demand follow and jump out as we start moving closer to getting back to as close to normal as possible. There were no trades posted in the overnight electronic session. The July ethanol settled at 1.185, and is currently showing 1 bid at 1.110 and 1 offer at 1.220, with Open Interest dropping to 108 contracts.

On the crude Oil front, China’s imports rebound to a new record high and Dan Eberhart, CEO of oil drilling company Canary, expects WTI to explode 90% from current levels, and reach as high as $70 a barrel by fall. He told Market Insider, U.S. oil producers will see a “mini-supply shock,” in autumn as they have “over-cut production.”

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