Good Morning
Chris Prentice of Reuters reported yesterday Renewable fuel (D6) Renewable Identification Number (RIN) credits jumped as high as 60 cents apiece according to traders, as the 2017 biofuels requirements came into effect. This impacted the Soybean Oil market reacting to the RFS standards of 15 billion gallon biofuel usage mandate. The Bio-fuels 1.5 RIN credits are a means to cover biofuels other than Ethanol. Corn was not effected as the market is positioning for the USDA Prospective Plantings March 31. In the overnight electronic session the May Corn is currently trading at 360 ¼, which is 1 cent lower. The trading range has been 361 ¾ to 360 ¼.
On the Ethanol front there were no trades posted in the overnight session. The April contract settled at 1.522 and is currently showing 6 bids @ 1.497 and 5 offers @ 1.530. The May contract surpassed the April in Open Interest at 1,714 contracts to 1,445 contracts.
On the Crude Oil front the API data showed another surprising build on Crude Oil and Distillates while showing draws on Gasoline. If the EIA confirms those numbers this morning one must ask where are these builds coming from, Canada maybe? In any event if this morning’s EIA report has a drastic change we could boomerang the market that broke on yesterday’s stock-market collapse with the Affordable Healthcare tweaks meeting resistance in the House. In the overnight electronic session the May contract is currently trading at 4761 which is 63 points lower. The trading range has been 4824 to 4742.
On the Natural Gas front yesterday’s rally had traders thinking it was nothing more than a short-covering rally that eventually petered out. Not enough bullish new going around at this time of year. In the overnight electronic session the April contract is currently trading at 3.058, which is 3 ½ cents lower. The trading range has been 3.095 to 3.045.