Commodity Corner: Morning Comments

Good morning,


DXM0  100.150  -0.020               GCM0  1707.0  +22.0                                    ESM0  2714.00  -21.00                  CLK0  25.99  +0.90


A very eventful day to lead the markets into an extended holiday weekend.  Markets will close at normal hours today, but then remain closed for Good Friday/Easter worship/celebrations.  The markets will re-open at normal times on Sunday night or Monday morning. 


Today’s events offer the markets a great chance for trading opportunities, and, once the news/data is revealed, will allow for fine tuning of positions ahead of the long weekend, with no access to futures markets.  The main events include:


7:30 AM CDT  US Jobless Claims & Continuing Claims

Jobless claims are expected to come in +5.5m, after being +6.6m last week and +3.3m the week before.  With last week’s nonfarm payrolls report for March showing a drop of 700k jobs, and the Unemployment Rate rising to 4.5%, this stat is viewed as the leader for the employment outlook.  Continuing Claims are also very important, and are expected to show +8.2m vs +3m last week.  With the Federal assistance being given to businesses, encouraging companies to keep employees on payrolls, movements in the continuing claims number over the next few weeks will carry as much significance as the jobless claims data.


9:00 AM CDT  OPEC+ begins its emergency production virtual meeting in Vienna    

The market chatter is that Saudi Arabia and Russia will come to some type of agreement on necessary production cuts to offset cratering demand, and all other members will be in agreement.  Market talk has a production cut of 10m b/d to 15m b/d cut (10m the most agreed upon). 

Russia supposedly is agreeing to cut production by 1.6m b/d.  Market dynamics and the overall lower price of oil are already forcing a reduction in US production, as was seen in yesterday’s data from the DOE.  Global storage capacity is quickly becoming a major issue, as demand has dried up, which naturally is forcing production cuts.  Headlines out of this meeting are likely to gyrate oil and energy markets. 


9:00 AM  Fed Chairman Powell gives an economic outlook view in the midst of the global pandemic

Pretty self-explanatory.  Given the horrible economic data that has come since the virus hit the US shores, and with data expected to remain bad for an extended amount of time, as companies remain closed or reduced for most likely a long time to come as a precautionary measure, Chairman Powell’s views and any comments about what other measures the Fed may contemplate taking to help the economy, will be watched for closely.  It will also be interesting to see if the chairman comments on recent data coming out of China, as it is in the recovery phase of the pandemic, and see if he may extrapolate what that could mean for the US economy. 



While not many changes are expected in this report today, the primary focus is likely to be on the corn for ethanol usage line of the balance sheet.  The story of oil, gas and ethanol is well known, from the OPEC+ members price war and the absolutely drop in consumption with shelter in place practices going on domestically and globally.  Also in view will be projections for the South American crops.  Downward revisions are expected to the size of the crop size in Brazil and Argentina, due to exceptionally hot and dry weather.  The inventory figures are expected to show increases for corn, both domestically and globally.  Soybeans should see an increase to the domestic stocks number, but a decline to the global number, due to the downtick in production in South America.  There is not expected to be any significant changes to the wheat data.  Official estimates can be found on the current data attachment. 


These event should provide plenty of landmines for markets to navigate today.  With the long weekend ahead, there could be a dramatic decline in interest / participation in the markets this afternoon (unless there is some very significant news / event taking place).   With the difficulties observed for over the past month with trading in the current pandemic environment, it feels like the 3 day weekend will be very welcomed by all! 


Have a great holiday weekend!  Stay safe and enjoy your family/friends!!    


Technical Moving Averages:

Product               50 day                100 day               200 day

SK0                      881.00                   909.00                   921.75

CK0                      366.00                   378.00                   395.00

WK0                     542.00                   544.50                   528.25

KWK0                  467.25                   468.25                   460.25

MWK0                 530.75                   537.50                   546.00

SMK0                   304.1                     305.1                     309.2

BOK0                   28.59                     30.84                     30.53

CLK0                    38.96                     48.43                     51.41

GCM0                  1608.9                   1564.9                   1532.9

LHM0                  73.195                   80.205                   84.645

LCM0                   99.975                   108.965                 109.945

KCK0                    111.10                   117.20                   112.55

CCK0                    2579                       2593                       2509

CTK0                    61.36                     65.10                     64.55

SBK0                    12.88                     13.21                     12.98

JOK0                    103.15                   102.90                   106.45

HGK0                   243.65                   259.80                   262.60

HOK0                   135.41                   163.01                   174.32

XBK0                    121.65                   152.77                   163.71

NGK0                   1.827                     2.004                     2.161





Michael Clifford


141 W Jackson Boulevard                             

Ste 1065                                                              

Chicago, IL 60604                                              

Trean Group, LLC