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Veteran Advisor

Floor Talk, May 20, 2020

At the close:

At the close, the July corn futures finished 1 3/4¢ lower at $3.19 1/4. Dec. corn futures settled 1/4¢ lower at $3.34.

July soybean futures finished 4 1/4¢ higher at $8.46 1/4. November soybean futures closed 3 3/4¢ higher at $8.54.

July wheat futures ended 15¢ higher at $5.13 1/4.

July soymeal futures closed $0.90 per short ton higher at $285.50.

 July soy oil futures closed 0.27 cent higher at 27.36¢ per pound.



In the outside markets, the NYMEX crude oil market is $1.53 per barrel higher at $33.49 per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 382 points higher.

Mike

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At midsession:

At midsession, the July corn futures are 3/4¢ lower at $3.20 1/4. Dec. corn futures are 1/4¢ higher at $3.34 1/2.

July soybean futures are 5 3/4¢ higher at $8.48 1/4. November soybean futures are 5 1/4¢ higher at $8.55 1/2.

July wheat futures are 17 1/2¢ higher at $5.16 1/4.

July soymeal futures are $1.60 per short ton higher at $286.20.

July soy oil futures are 0.27 cent higher at 27.36¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.14 per barrel higher at $33.10 per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 400 points higher.

Al Kluis, Kluis Advisors, says that the markets are being influenced by the growing weather and the crude oil market's direction.

"The 2020 corn and soybean crops are off to a good start with non-threatening weather forecasts for the next two weeks," Kluis told customers in a daily note. The rally back in the energy and stock markets around the world shows that the consumer economy is starting to recover and demand for food and energy is increasing each week.

Kluis added, "What will be in today’s Energy Information Agency report? The key is to watch weekly gasoline consumption. U.S. weekly gasoline consumption has improved over the last four weeks. I think today’s EIA report will show even more demand for gasoline, diesel and ethanol, again."

The Energy Information Administration (EIA) released its weekly Energy Report Wednesday. For the week ending May 15, ethanol production increased by 7.5%, or 46,000 barrels per day (b/d), to 663,000 b/d. This amounts to 27.85 million gallons daily and a six-week high.
However, the coronavirus continues to depress production. This week's output is 38.1% below the same week in 2019.
The four-week average ethanol production rate increased 4.3% to 604,000 b/d, equating to 9.26 billion gallons annually.

Ethanol stocks dropped 2.3% to 23.6 million barrels, the lowest volume since January. Total reserves are just 0.9% above year-ago volumes.

The volume of U.S. gasoline supplied to the U.S. market, a measure of implied demand, slipped 8.2% to 6.790 million b/d (104.09 billion gallons annualized) following five consecutive weeks of expansion. As a result, gasoline demand was 28.0% lower than a year ago.

 

Mike

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2 Replies
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Veteran Advisor

Re: That slide in gasoline supplied is a little puzzling.....

The slide in gasoline supplied is a little puzzling unless the previous 7.398 million barrels per day was a compensation bounce just to refill depleted retail tanks in anticipation of more driving.   Maybe a better measure of gasoline consumed is the average (7.398 +6.700)/2=  7.05 over the two week period.

  Ethanol stocks didn't drop as much as you might have expected, either but they still dropped.  I wonder when some of these shut ethanol plants might possibly restart?

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Honored Advisor

Re: Floor Talk, May 20, 2020

Kluis nonsense..... the spinner of tangled webbs

"The volume of U.S. gasoline supplied to the U.S. market, a measure of implied demand,....)

So the volume of corn supplied by farmers to the market is a measure of implied demand....   nonsense.

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