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Nobody Needs NATO More Than France. The Corn & Ethanol Report 12/03/19

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We kickoff the day with Redbook at 7:55 A.M., ISM New York Index at 8:45 A.M., 52-Week Bill Auction at 10:30 A.M. and API Energy Stocks at 3:30 P.M. President Trump hinted the U.S.-China trade deal may be postpones until after the 2020 election. I believe China cannot wait that long and are imploring their negotiators strike a deal. Mow let’s get back to France with their weak economy and taxing U.S. goods. Well turnaround is fair play, the U.S. plans to tax French Champagne, cosmetics and French Cheese 100% in return. French President Emmanuel Macron’s recent rebuke of NATO, claiming NATO is experiencing a “brain death”, with U.S. troop movements in Syria. How did you guys fair their Emmanuel? France historically is the country in most need of military protection afforded by the 70-year old NATO alliance. Your welcome as you forget to say thankyou for two world wars and Viet Nam you were bailed out of, to name a few. On the Corn front the market tried to settle in the green but eventually sold off before the close in yesterday’s open out-cry session. Corn Export Inspections came in at a dismal 428,856 tonnes with the street looking for 500,000 to 700,000 tonnes. The futures market is trying to buck the bearish trend with slow movement in the Cash market. In the overnight electronic session the March Corn is currently trading at 381 ¼ which is ¾ of a cent lower. The trading range has been 384 ¼ to 380 ¼. Just another weather trap in the 2019 planting, growing and harvesting. What a year.

On the Ethanol front Ethanol front a report released from the U.S. Department of Agriculture’s Foreign Agriculture Service says that while Thailand has relied on domestic Ethanol production, the country could benefit from importing Ethanol and other Biofuels. While the country allows imports for industrial use it does not import Ethanol for transportation use. The country’s Ministry of Energy, however, “to date”, has approved imports of Fuel Ethanol due to sufficient local supplies. This could possibly change and open another trade partner. There was a lot of activity in the Ethanol futures, with the spot trading lower and the deferred months trading higher. In the overnight electronic session the January contract is currently trading at 1.392 which is .017 lower. The trading range has been 1.442 to 1.386. The market is currently showing 1 bid @ 1.397 and 1 offer @ 1.412 with 5 contracts traded and Open Interest at 488 contracts.

On the Crude Oil front word on the street is that Russia is going to comply with whatever OPEC wishes in production cuts. Though you would not know it with the market freaking out on trade disputes, yet again. If you look at these situations historically, like last year you will see it created a buying opportunity. Once the market starts to trade on supply/demand our trade counterparts will be dancing to our tune and not us to theirs, and I expect a bullish outcome. In the overnight electronic session the January Crude Oil is currently trading at 5571 which is 25 points lower. The trading range has been 5644 to 5535.

On the Natural Gas front the market is flying with the winter storm affecting 33 states in a bad way. In the overnight electronic session the January contract is currently trading at 2.309 which is 7 cents higher. The trading range has been 2.426 to 2.340.

Have a Great Trading Day!
Dan Flynn   


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