Good Morning!
Quiet trade in the overnight session with the March corn currently trading on the low at 356, which is 2 cents lower. The has been 358 so far and as I said a slim trading range. Now the market is looking for news such as China buying, South American weather and plantings now that the government halted a tax on certain exports as well as our weather here in the U.S. and how many acres will the U.S. plant or not plant and how much more South America will make up the difference on the world market. Also two other questions: will there be further flooding that will hamper plantings; and will La Nina cause an intense drought? Those questions are on the minds of farmers and traders that will factor in this market.
On the ethanol front again there were no trades posted in the overnight session. The February contract settled at 1.308 and is currently showing 1 bid @ 1.293 and 1 offer @ 1.312.
On the crude oil front the market is trading higher with a lot of issues on the horizon. A possible emergency OPEC meeting, record Crude Oil purchases by China at these price levels, Saudi Arabia and Iran tensions that may boil over and ignite a fire in the Middle East that we have not seen since the Jimmy Carter days. Tensions are at boiling point in North Africa on the shores of Tripoli. Libya is just another hot spot on the map ready to ignite and change the whole free fall psychology in the crude oil market. If there is any disruption in maritime traffic, such as the closure of the Strait of Hormuz, this market could be up $20 overnight. In the overnight electronic session the February contract is currently trading at 3079 which is 31 points higher. The trading range has been 3097 to 3028 so far.
On the natural gas front we have the weekly EIA Gas Storage report to be released this morning at 9:30 A.M. C.S.T. A Thomson Reuters poll of 21 market analyst predicted draws anywhere from 158 to 192 bcf’s. We should receive a reprieve of Arctic conditions the next couple of days then its smack in your face again next week. If there is a higher draw than anticipated it could swing the pendulum back in the bulls favor. In the overnight electronic session the February contract is currently trading at 2.230 which is .039 cents lower. The trading range has been 2.294 to 2.222 so far.
Have a Great Trading Day!