U.S. Biofuel Waivers to be Denied
- The Environmental Protection Agency could reject as many as 67 retroactive blending waiver requests as soon as this week.
- Federal law authorizes the EPA to grant the exemptions for small refineries that can prove hardship complying with the biofuel blending requirements.
- The Trump administration had previously quadrupled the number of exemptions given out to refiners.
- In January, an appeals court ruled that waivers granted to small refineries after 2010 could only be approved as extensions of pre-existing waivers.
- Refineries filed applications with the EPA seeking retroactive waivers from the biofuel-blending requirements dating back to 2011.
- The Trump administration has not yet decided whether to reject a separate group of 28 pending requests tied to 2019 biofuel quotas.
FBN’s Take On What It Means: Biofuel policy often divides President Trump’s political base, pitting oil refining states against those producing ethanol. This is welcome news for the biofuel industry, which has not fully recovered from the hit taken due to the coronavirus. The dismissal of refiner exemptions will be supportive of ethanol and ultimately corn demand.
Argentina Crop Outlook
- Rosario grain exchange forecast Argentina's 2020/21 soybean at 50 million tonnes compared to 50.7 million last year.
- USDA forecast Argentina’s soybean production at 49.7 million tonnes in August.
- Planted area is projected to increase 0.6% versus a year earlier to 17.3 million hectares (42.75 million acres).
- Corn production for 2020/21 is forecast at 48 million tons, down from 51 million last year and below the USDA’s projected 50 million tonnes.
- The exchange forecast wheat production at 18 million tonnes, at the lower end of its previous 18-19 million tonnes projection.
FBN’s Take On What It Means: Argentina has had a drier than normal spring which has hurt the condition of wheat and lowered expectations for production. Recent rains have helped improve prospects for corn planting later this month. Comparative prices are encouraging corn planting even though the weather has not been ideal. USDA will update their forecast of world supply and demand in their report Friday.
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