China Has Plans To Import More U.S. Ethanol
Good Morning!
We kickoff the day with Fed Kaplan Speech at 7:00 A.M., Housing Starts & Permits at 7:30 A.M., Capacity Utilization & Industrial Production at 8:15 A.M., IBD/TIPP Economic Optimism and JOLTS Job Openings at 9:00 A.M., Fed Williams Speech at 11:30 A.M. followed by Fed Rosengren Speech at 12:00 P.M. and API Energy Stocks at 3:30 P.M. On the Corn front the market seems to be throwing in the towel for the year. Bullish news has not put enough thrust in volume and give the market some legs to punch through 400 and stay. Winter storms have disrupted this late harvest yet again. Funds are still on the short side and I expect this market to wake up and have the running of the bulls in the New Year. In the overnight electronic session the March Corn is currently trading at 387, which is 1 cent lower. The trading range has been 388 ¼ to 386 ¼.
On the Ethanol front China plans to lift tariffs and increase imports to the tune of $200 billion in the next two years. The main focus of Beijing will be purchases of commodities such as Corn, Ethanol, Soybeans and Pork. A lot of commodities to export are on the table and this is only “Phase 1” of the trade deal. In the overnight electronic session the January Ethanol is currently trading at 1.402, which is .012 higher. The trading range has been 1.402 to 1.390. The market is currently showing 1 bid @ 1.390 and 1 offer @ 1.402 with 44 contracts traded and Open Interest at 294 contracts.
On the Crude Oil front we have the API Energy Stocks at 3:30 P.M. and the street is looking for withdrawals of 3 Mln barrels in Crude and 2Mln barrels in Products. With more production cuts, trade deals and the growing global economy with the Stock Market at record highs we should see a continuation of this rally. In the overnight electronic session the January Crude Oil is currently trading at 6053, which is 32 points higher. The trading range has been 6058 to 6003.
On the Natural Gas front this market continues the wild chop. What is here today is gone tomorrow and vise versa. Changing weather forecast in the U.S. and European modules have increased the volatility in this market and made holding positions over the weekend scary. In the overnight electronic session the January Natural Gas is currently trading at 2.331, which is 1 cent lower. The trading range has been 2.362 to 2.282.
Have a Great Trading Day!