U.S. Lower Helped Corn & Crude Oils About-Face. The Corn & Ethanol Report

We start off the day with Business Inventories, Retail Sales MoM (APR), Retail Sales Ex Autos MoM (APR), Export Prices YoY & MoM (APR), Import Prices YoY & MoM (APR) and Retail Sales at 7:30 A.M., Industrial Production YoY & MoM (APR) and Capacity Utilization (APR) at 8:15 A.M., Business Inventories MoM (MAR), Michigan Consumer Sentiment Prel (MAY), Michigan Inflation Expectations Prel (MAY), Michigan 5-Year Inflation Expectations Prel (MAY) at 9:00 A.M., Baker Hughes Oil & Total Rig Count at 12:00 P.M., and Consumer Credit at 2:00 P.M.

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On the Corn front, the futures trade sharply lower with limit down moves as the USDA did not raise the 2021/22 corn demand, the concerns of the bridge over Memphis halting navigation down the Mighty Mississippi so corn barges cannot reach the Gulf to load Chinese corn vessels. Tugboats could be employed to assist barges as they go under the bridge, so barges are not bumping into the bridge. Estimates that 80% of barge traffic in the bottleneck are transporting corn. Other fears were Midwest weather concerns with frost earlier in the week and the Drought Index growing across and there was no help with the U.S. dollar rising making commodities more expensive. The dollar is trading lower in the overnight. I believe we have seen a bottom and hope not to see any more bearish surprises. In the overnight electronic session, the July corn is currently trading at 681 ¾ which is 7 cents higher. The trading range has been 687 to 666.

On the Ethanol front, the U.K. Department for Transport released draft legislation to implement the planned adoption of E10 going back to February. This is a sign of more exports to Europe and Asian exports are growing as well. We may see a lesser degree as India still is fending off their Covid crisis. There were no trades posted in the overnight electronic session. The June ethanol settled at 2.340 and is currently showing no market with Open Interest at 21 contracts.

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