We kickoff the day with Challenger Job Cuts (JAN) at 6:30 A.M., Export Sales, Initial Jobless Claims (30/JAN), Jobless Claims 4-Week Average (30/JAN), Unit Labour Cost QoQ Prel (Q4), Nonfarm Productivity QoQ Prel (Q4) at 7:30 A.M., Factory Orders MoM (DEC) and Factory Orders ex Transportation (DEC) at 9:00 A.M., EIA Gas Storage at 9:30 A.M., 4-Week & 8-Week Bill Auction at 10:3o A.M., and Fed Daly Speech at 1:00 P.M.
On the Corn Front we came out of the blocks lower but proceeded to trade higher in yesterday’s trading session and settled unchanged. Talk on the street is traders are expecting a good export sales number with renewed weather concerns in Argentina. There are also whispers that the African Swine Fever back in the China hog herd. Commercials were rolling shorts from the March contract to the May contract with no word as of yet on fund activity. Traders do expect China be back on the dance floor buying U.S. corn and soybeans soon as they were busy with purchases last week. In the overnight electronic session, the March corn is currently trading at 556 ½ which is 4 ½ cents higher. The trading range has been 558 to 551.
On the Ethanol Front the EIA data showed ethanol production was up from last week but down from last year while ethanol stocks were up from last week and a year ago. Traders are also aware that China is kicking tires and sniffing out prices and could purchase produce at any time and at the right price. There were no trades posted in the overnight electronic session. The April ethanol settled at 1.749 and is currently showing 1 bid @ 1.501 and 2 offers @ 1.749 with Open Interest.
On the Crude Oil Front prices continue to trend higher after OPEC+ alliance of major producers kept reduced output policy at a meeting on Wednesday. The EIA also showed crude oil stockpiles in the U.S. fell to the lowest level since March of last year. The same month lockdowns were implemented, and the Russian-Saudi price war was not far off and drove prices to the negative in May. Brent crude hit their highest level since Feb 21, 2020.
Edward Moya Senior market analyst with OANDA said, “Crude prices have been rising higher now that OPEC+ has convinced the energy market that they are determined in accelerating market re-balancing without delay. In the overnight electronic session, the March crude oil is currently trading at 5607 which is 38 points higher. The trading range has been 5615 to 5577.
On the Natural Gas Front more snow and extreme cold is in the forecast today with the cold sticking around for a while as futures prices have fallen and most traders see that as an aberration with storage numbers out this morning. The Thomson Reuters poll with 18 analyst participating estimate withdrawals ranging from 194-bcf to 172-bcf with the median 193-bcf and the actual 192-bcf. This compares to the one-year withdrawal of 121-bcf and the five-year average of 125-bcf. We also have Wall Street Journal’s poll with other analysts estimates. In the overnight electronic session, the March natural gas is currently trading at 2.804 which is .015 higher. The trading range has been 2.807 to 2.734.
Join me Thursday mornings at 7:30 A.M. at Rural Radio Channel 147 SIRIUSXM as we digest the export sales numbers.
Have A Great Trading Day!