On the front the December corn made a high of 419 and closed at 416 ¼ which was 2 ½ cents higher in yesterday’s trading session. The Export Sales were pretty healthy with export demand mainly from China. While harvest is moving at a fast pace the northern Corn Belt will have difficulties with rains, drop in temperatures and frost. Funds stepped in yesterday and bought additional corn contracts and Farmers are in no rush to sell and traders anticipate another round if not 2 of Chinese buying. In the overnight electronic session, the December corn is currently trading at 415 ¾ which is a ½ of a cent lower. The trading range has been 417 ¼ to 414 ¼.
On the front the market is wondering like most human beings what is at stake with the second round of COVID-19 for state and municipal lockdowns coming back into play. Pacific Ethanol (NASDAQ:) is again, working to adjust two of their plants in California to match the output, (which put them back on the NASDQ map and globally), in Pekin, Illinois to add and bolster for another surge in demand for high-grade alcohol, which serves as hand sanitizers, disinfectants and distilling byproducts used for animal feed. Their Pekin plant is on track to achieve annual capacity of about 135 million gallons by the end of the year, up from 80 million gallons in March.
Pacific Ethanol stocks took a hit in yesterday’s action and they were not alone as fears grip investors when our so-called local governments have no answer except, don’t even get out of bed today stay locked down. There are plenty of cases where that may be true in which I agree, but someone must work to keep this republic and many other countries functioning. Pacific Ethanol is smart moving ahead to diversify in case there is a rise for more product other than putting ethanol in the gas tank. There were no trades posted in the overnight electronic session. The November ethanol settles at 1.520 and is currently showing 1 bid st 1.400 with 0 offers and Open Interest at 45 contracts.
On the front the market gathered more strength as House Speaker Nancy Pelosi a deal (on stimulus) is “just about there”. prices fell as the mood swing of the market buoyed Treasury bond yields and rallied the U.S. . Economic data was also supportive with rising to a 14-Year high and were lower than expected.
Also, Vladimir Putin is in favor of keeping OPEC production cuts in play and possibly more extensions farther than the eye can see. He may have learned a lesson as well as the feud with Saudi Arabia and the pandemic just drove prices into the negative. In the overnight electronic session, the December is currently trading at 4069 which is 5 points higher. The trading range has been 4080 to 4032.
On the front, the market is taking it on the chin in the early going. However, I remain a staunch bull overall and see this as nothing more than profit taking. Unless there is a headline I am missing. Weather forecasters have projected this will be a cold winter and domestic demand not to mention European and Asian demand will pick up.
We will see more product move with fears of COVID-19 and countries that will need heat and other uses to keep the lights on this valuable commodity can be counted on for. So yes, domestic demand should rise and overseas exports of LNG as well during the winter months. In the overnight electronic session the November is currently trading at 2.936 which is .071 lower. The trading range has been 2.993 to 2.928.
The Link LonkOctober 23, 2020 at 07:11PM
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Corn And Ethanol: Still Holding Hope On Stimulus - Investing.com
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