The Corn And Ethanol Report: February 13, 2020

Good Morning!

We kickoff the day with Consumer Price Index (CPI), Export Sales, Jobless Claims and Real Earnings at 7:30 A.M., EIA Gas Storage at 9:30 A.M., 4 & 8-Week Bill Auction at 12:00 P.M. and Fed Williams Speech at 4:30 P.M. Chinese health officials saw the number of coronavirus significantly increase to 14,840 new cases. The country now has 50 thousand confirmed cases and 1,300 people have died worldwide. The L.A. Times reported that 90% of the new cases were “clinically diagnosed”, Doctors in the country relied on a nucleic test that was criticized over their accuracy. With the new guidelines patients undergo a CT Scan of their lungs and are observed by doctors to see if they ‘re symptomatic. China has lock downed an unprecedented 60 million people in an effort to curb the spread of the virus, which has hit hardest in the city of Wuhan and the surrounding towns in the Hubei province. Chinese President Xi Jinping promised tax cuts and other aid to industry as the ruling Communist Party tries to limit the mounting damage to their economy. This information was provided by Edmund Demarche with Fox News.

On the corn front the market traded higher in yesterdays open out-cry session in hopes that China has gotten control of the spread of the coronavirus and their stimulus packages would benefit their economy and increase demand for commodities. This mornings news has cast further doubt that the epidemic has been lassoed. Corn Export sales came in at 968,900 mt with expectations ranging from 600K – 1.1 mln. mt. In the overnight electronic session the March Corn is currently trading at 381 1/4 , which is 1 3/4 of a cent lower. The trading range has been 382 3/4 to 380 1/4 .

On the Ethanol front there were no trades posted in the overnight electronic session. Bankers in the heartland of wary of Ethanol producers in this boom or bust industry with risk on risk off volatility changing rapidly day to day. The march contract settled at 1.345 and is currently showing 1 bid @ 1.331 and 1 offer @ 1.344 with Open Interest at 276 contracts.

On the Crude Oil front the market is recovering from the depths of the latest coronavirus fears. In the overnight electronic session the March Crude Oil is currently trading at 5144, which is 27 points higher. The trading range has been 5196 to 5060.

On the Natural Gas front we have the EIA Gas Storage today and the Thomson Reuters poll with 15 analysts participating expect withdrawals ranging from 122 bcf to 80 bcf with the median 110 bcf. This compares to the one-year draw of 163 bcf and the five-year average reduction at 136 bcf. This maybe Old-man Winter’s last punch heading into the weekend and the bears will be licking their chops for more downside trade. In the overnight electronic session the March Natural Gas is currently trading at 1.859, which is 1 1/2 of a cent higher. The trading range has been 1.868 to 1.824.

Have a Great Trading Day!