Wild Ride In Energies And Grains. The Corn & Ethanol Report

We started off the day with Export Sales, Initial Jobless Claims (15/MAY), Jobless Claims 4-Week Average (15/MAY), Philadelphia Fed Manufacturing Index and Continuing Jobless Claims (08/MAY at 7:30 A.M., CB Leading Index MoM (APR) at 9:00 A.M. EIA Gas Storage at 9:30 A.M. 4-Week and 8-Week Bill Auction at 10:00 A.M. and 10-Year TIPS Auction at 12:00 P.M.

green-leafed plants

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On the corn front, it was a wild ride in yesterday’s action with rains that fell, and the market was pressed even further as funds were net sellers of 10,000 contracts. The market buoyed off the lows when common sense came back into play. The funds were still jittery over a private forecaster predicted increased acreage and they sold on panic. I thought the panic was over, but they clearly wanted to clear the decks with long positions. As the market rallied and came back the funds bought 2,000 contracts. We must remember the Chinese came in 4 times in this month alone and purchased over 1 million tons of U.S. corn at a crack. So, the Export Sales number will be critical as the market made quite the recovery in yesterday’s action. In the overnight electronic session, the July corn is currently trading at 659 ¼ which is 1 cent higher. The trading range has been 667 ½ to 659.

On the Ethanol front, production and stocks were up modestly this week. The EIA showed production averaged 1.032 million barrels a day, the highest weekly average since March 2020, (The beginning of the pandemic shutdowns), also up 52,000 on the week and 369,000 on the year. Ethanol stocks were reported at 19,433 million barrels, 40,000 above a week ago, but down 4,193 million a year ago in the shutdown. The Renewable Fuels Administration said input for blenders and refineries and the volume of gasoline to the market had a week to week and year to year increases. The USDA said Midwest ethanol prices were higher last week. The next USDA corn for ethanol use is June 10th. There were no trades posted in the overnight electronic session. The June contract settled at 2.350 and currently showing no market with Open Interest at 21 contracts.

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