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SMTP FAIL to external addresses using 2013/o365 hybrid

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We have an application sending emails. It always works for domain addresses that are in o365.  It fails every time to external addresses. The application is from a local server on prem and uses a mailbox in o365.  Looking at the message tracking logs, 

I get this 

'[{LRT=};{LED=550 5.7.64 TenantAttribution; Relay Access Denied};{FQDN=};{IP=}]'

The receive connector on my local exchange server has the IP address for the application server in the Remote Network Settings. 

What else can I check?


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