Good Morning!
Reuters reported Brazil’s 2016-17 Soybean crop will reach a record 104.7 million tonnes, favored by good weather as the harvest intensifies in important growing regions. This news comes before today’s report with traders looking to sell any strength in the Soybeans. Depending what is reported on global stocks, the cat may have already left the bag barring any major surprise the Grain complex most likely will follow in sympathy as we anticipate another record crop in Corn even though exports are moving and usage in feed and Ethanol are on the upswing. In the overnight electronic session the March Corn is currently trading at 369 ¼, which is 1 ½ of a cent lower. The trading range has been tight ahead of the report trading from 369 ¾ to 368 ¾.
On the Ethanol front the March contract is currently trading at 1.586, which is .018 lower. The trading range has been 1.599 to 1.586. Today’s Grain report will have a reflection on this market as it looks to Corn prices as 40% of the crop is used in this bio-mass which is cheaper than using Sugar based Ethanol.
On the Crude Oil front, the end is near as in large stockpiles of Crude Oil and Gasoline. We will soon start to feel the OPEC production cuts as the flow of Oil is decreasing with the cuts and not many more holdovers of product to be realized as reserves are dwindling. In the overnight electronic session the March Crude Oil is currently trading at 5285 which is 51 points higher. The trading range has been 5303 to 5237.
On the Natural Gas front another changing forecast calling for colder temperatures yet again. It feels like they may be correct the way it feels this morning, however, temperatures are forecasted to moderate over the weekend. After the warmup we are supposed to slide back to more winter-like temperatures. Just ask our friends that were basking in 60 degree Fahrenheit weather and now are bracing for a Nor’easter. We also have the EIA Gas Storage today with the Thomson Reuters poll of 23 analyst expect draws in the injection number anywhere from 124 bcf to 172 bcf with 153 bcf being the median. These numbers compare to 87 bcf a week ago, 93 bcf on the 1-year and the five-year average of 138 bcf. Believe it or not heating demand did rise while production fell. In the overnight electronic session the March Natural Gas is currently trading at 3.166, which is 4 cents higher. The trading range has been 3.177 to 3.138.
Have a Great Trading Day