We start off the day with NY Fed Treasury Purchases 22.5 to 30 yrs. at 9:30 A.M., Consumer Inflation Expectations (Aug) and Export Inspections at 10:00 A.M., 3-month and 6-month Bill Auction at 10:30 A.M., Monthly Budget Statement (Aug) at 1:00 P.M. and Crop Progress at 3:00 P.M.
On the Hurricane Front Tropical Nicholas is moving north-northeast at 4 knots and the current cone has it making landfall on the Gulf Coast of Mexico which could affect the Houston Shipping Channel and move north-northeast and if stays on land it will be a rainmaker through Louisiana and Mississippi which they do not need but if it bounces back in the Gulf waters it could be disastrous. Disturbance 2 is moving north-northwestward across the western Atlantic. There is a 50% chance of formation in the next five days. And Disturbance 1 a tropical wave emerging off the African Coast of Guinea and Sierra Leone we will be watching closely as well.
On the Corn Front production was above August levels and above the average of trade expectations. We rallied off the number on Friday and giving it back this morning. Exports to China may commence once again with whispers that Biden and Xi Jinping are discussing trade or renegotiating the Trade Deal. I hope he doesn’t keep rolling and once again take defeat out of the jaws of victory. In the overnight electronic session the December corn is currently trading at 510 ¾ which is 6 ¾ cents lower. The trading range has been 519 ¾ to 508 ½.
On the Ethanol Front the USDA released a report that showed a drop in ethanol exports in 2020 and a mixed bag moving forward. Brazil is a major player in the ethanol market and accounted for a major hit to U.S. ethanol exports last year. Sales to Canada held mostly steady in FY 2020. U.S. suppliers backfilled Canada’s increase sale to Europe. Sales to mainland China rose from zero to 21`.2 million gallons. Again there were no trades posted in the overnight session leaving zero Open Interest.
On the Crude Oil front we will be on Tropical storm watch as we have activity in the Gulf of Mexico and other storms brewing. Oil is at a one-week high with supply concerns dominating the market, and the fears of damage from the next round of tropical storms. In the overnight electronic session the October Crude Oil is currently trading at 7050 which is 78 points higher. The trading range has been 7084 to 6951.
On the Natural Gas Front the futures are rallying due to the uncertainty of Tropical Storm Nicholas as traders gage the potential energy impacts right after Hurricane Ida. In the overnight electronic session the October natural gas is currently trading at 5.197 to 4.789.
Have A Great Trading Day!
Dan Flynn -