Weekly Export Sales and Crop Production on Tap Today
After Friday’s Crop Production USDA Supply/Demand report the Grains traded very parabolic and in the overnight electronic session is showing further strength with the exception of Soybean Oil. Weather and crop damage in Brazil and weather we are experiencing is leading to higher prices. We could be talking “beans in the teens or drop your jeans,” very shortly.
In the overnight electronic session the July Corn is currently trading at 432 which is 9 cents higher. The trading range has been 436 to 427 ½ so far. Two other events will have investors keying on the next couple weeks, #1 will the FED use common sense and leave Interest Rates in check on Wednesday and the upcoming Brexit vote on Thursday June 23rd.
On the Ethanol front the July contract posted a trade at 1.683 which is .026 cents higher while the August contract posted a trade at 1.665 which is .025 cents higher. The market is showing positioning with early rollovers and we may have an active market in July and August. The July contract is currently showing 2 bids @ 1.673 and 4 offers @ 1.690. Strength in Corn and Sugar with expectations the Energy complex will follow suit is just another sign of bullish prices to come. Also with EPA further medaling on larger volumes in the Ethanol Mandate which will make a less than attractive gasoline substitute for combustion engines and putting less feed and less product in the food chain when we need it most.
On the Crude Oil front the market is easing off a little again after achieving $50 a barrel but not quite able to punch through 5187 and the sellers have led the way since, however, I expect a rally in Monday’s trading session. The weekly API Energy Stocks will be released Tuesday at roughly 3:30 P.M. and the weekly EIA Energy Stocks Wednesday morning should shows some draws with the Canadian wild fires and flooding in Houston which kept tankers out of the Houston Shipping Cannel. We also have to remember Libya, Iraq, Iran, Nigeria and Venezuela for product disruptions again. In the overnight electronic session the July contract is currently trading at 4860 which is 47 points lower. The trading range has been 4893 to 4821 so far. We could see a rally in the Energy complex as a whole with the weather forecast this week.
On the Natural Gas front the piece of the recipe is here to rally tis market with the heat dome we will experience this week and will have air-conditioning units working overtime. Also with rig-counts with 300+ fewer rigs than last year at this time and much hotter muggier weather than last year, when demand kicks in this ought to be a daisy. In the overnight electronic session the July Natural Gas is currently trading at 2.616 which is 6 cents higher. The trading range has been 2.635 to 2.583 in the early going.