Warmer Weather On Your Way To The Polls; The Corn & Ethanol Report

We started off the day with Redbook YoY & MoM (31/OCT) at 7:55 A.M., ISM New York Index (OCT) at 8:45 A.M., IBD/TIPP Economic Optimism (NOV), Factory Orders at 9:00 A.M., 119-Day & 42-Day Bill Auction at 10:30 A.M., 52-Week Bill Auction is due at 12:00 P.M., API Energy Stocks at 3:30 P.M., Total Vehicle Sales and Incoming Election Results at 7:00 P.M.

On the Hurricane front, hurricane Eta’s eyewall moves onshore along the coast of Nicaragua and residents should have completed preparations a came back and had a strong close in yesterday’s action. Tropical Storm Warning is also in effect for the northeastern coast of Honduras. This hurricane has the potential to boomerang and could come into play again and we should track this storm and watch events unfold in the Caribbean.

On the Corn front, we saw the market come back and have a good close after the pall of the risen COVID-19 cases. I believe the following will drive prices even higher. 70-degree weather is back this week which will help to harvest, the COVID-19 initial shock that shook, but it seems traders expect demand not to fall from the map, China is not done buying U.S. Ag products and we have an election to hopefully keep these trade deals in place. We did see the funds were lightening their net-long positions, a very logical move. The headlines the next couple of days could also bring back a host of speculators buying with both hands wide-open. In the overnight electronic session, the December corn is currently trading at 400 ½ which is 3 cents lower. The trading range has been 402 ¾ to 395 ¼.

On the Ethanol front, the Chinese are starting to buy U.S. ethanol in a move that was open to them for some time. The industry is hopeful they will ramp up more orders and purchases. This could be a boost to the ethanol industry and corn after dealing with the COVID-19 and Russian- Saudi oil price war in 2020. This also comes at a time when corn use for fuel alcohol was down from the previous two months and fears of another lockdown surge will disrupt demand again. There were no trades posted in the overnight electronic the December ethanol settled at 1.390 and is currently showing 0 bids and 1 offer @ 1.500 and Open Interest at 44 contracts.

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