We start off the day with Redbook YoY (28/Aug) at 7:55 A.M., S&P/Case-Shiller Home Price MoM & YoY (Jun) and House Price Index MoM & YoY (Jun) ay 8:00 A.M., Chicago PMI (Aug) at 8:45 A.M., CB Consumer Confidence (Aug) at 9:00 A.M., NY Fed Treasury Purchases 10 to 22.5 yrs. at 9:30 A.M., 21-Day Bill Auction at 10:30 A.M., and API Energy Stocks at 3:30 P.M.
On the Hurricane Front Ida is now a Depression and moving in a north-northeastern pattern causing havoc with flash floods in her path. Tropical Storm Kate is located several hundred miles south east of Bermuda. The current cone has the storm moving north and over the weekend is expected to move north-northeastward away from the U.S. Coast. Disturbance 1 has a 90% chance of hurricane formation in 48hrs. It is moving west-northwestward of the coast of Africa. We will be monitoring the track of this storm.
On the Corn Front 4% of Illinois corn has reached maturity last week, down from the five-year average of 10%, but with the state 6.5 degrees above normal the crop is drying out for the upcoming harvest. As of Sunday, the USDA reports 88% of the crop is in dough stage with 65% dented. The Illinois crop is rated 70% good to excellent, up 3% from last week. In the overnight electronic session the December corn is currently trading at 537 ¼ which is 5 ½ cents lower. The trading range has been 545 ½ to 537. We are still trying to assess when barge traffic and loading could resume.
On the Ethanol Front the USDA predicts fiscal year (FY) 2021 ethanol exports will be at $2.2 billion, down $60 million when compared to 2020. Moving into FY 2022, however, U.S. ethanol exports are expected to reach $2.4 billion, up $200 million from FY 2021. The agency made those predictions in its latest quarterly trade forecast, released August 26th. Beginning with this latest quarterly trade forecast, the USDA said it is adopting the World Trade Organization’s definition of ‘agricultural products,” which adds ethanol, distilled spirits and other products. The USDA said it expects higher corn prices to elevate ethanol unit values.
On the Crude Oil Front the energy industry is working round the clock to assess damage and this is going to be weeks and not days. The API and EIA Energy Stocks will be more magnified as production will be important as they move to get refineries back online. The market is trading demand destruction after the path of Ida has left and attacking other states. In the overnight electronic session the October crude oil is currently trading at 6849 which is 72 points lower. The trading range has been 6934 to 6829.
On the Natural gas Front this market is in demand destruction mode as well. Cooler temperatures could accelerate selloffs. In the overnight electronic session the October natural gas is currently trading at 4.255 which is 5 cents lower. The trading range has been 4.344 to 4.215.
Have A Great Trading Day!
Dan Flynn -