Rains Grains Floods & Heat Domes
This morning we kick off the day with Export Sales, Initial Jobless Claims, and PPI at 8:30 A.M. followed by the weekly EIA Gas Storage at 9:30 A.M. and the last day of Janet Yellen speaking. Yesterday’s Grain report was lackluster at best where many investors were glum as they were expecting a more bullish surprise.
The continued changing of weather forecast with rains and the heat dome that did not head as far east in a more northerly direction and with product on hand regardless off exports kept the bears on the selling accelerator with any sort of rally. Weather changes with rains, flooding and the heat dome could be a game changer in the next couple of weeks. In the overnight electronic session the September Corn is currently trading at 381 which is 4 ½ cents lower. The trading range has been 385 ¼ to 380 ½.
On the ethanol front there were no trades posted in the overnight electronic session. The August contract settled at 1.550 and is currently showing 1 bid @ 1.537 and 4 offers @ 1.556 with declining Open Interest at 978 contracts as traders begin the roll to the September contract.
On the crude oil front what can you say…? Investments in wells and drillings are down at these prices. OPEC has called for an emergency meeting on July 17th which could expand and extend future production cuts with already the draws showing in the U.S. weekly inventories. Any more bullish news could give this market a resounding pop that will surprise the naysayers and spark a rally with those investors caught short. In the overnight electronic session the August crude oil has already turned around from being 50 points lower. The contract is currently trading at 4555 which is 6 points higher. The trading range has been 4563 to 4499.
On the natural gas front the market is trading lower ahead of the EIA Gas Storage. The weekly Thomson Reuters poll of 24 analyst polled see injection numbers anywhere from 43 bcf to 65 bcf with the median build of 59 bcf. This compares to last week’s build of 72 bcf, the 1 year at 61 bcf and the five year average of 72 bcf. In the overnight electronic session the August contract is currently trading at 2.955 which is 3 cents lower. The trading range has been 3.020 to 2.947. We are still tracking the heat dome and we are not expecting any Tropical cyclone activity in the Atlantic for the next 48 hours.