Dec 09, 2020

Biofuel Groups File Appeal

Coalition is challenging 2019 decision to grant refineries exemptions

Export Sales Announcement

  • Private exporters reported to the U.S. Department of Agriculture export sales of 257,071 metric tons of corn for delivery to Mexico during the 2020/2021 marketing year.

Brazil Soil Moisture Improved

  • Rainfall in Brazil during the past week was enough to significantly increase soil moisture for much of the country.
  • The rain helped many areas in center south and center west Brazil that were previously struggling with dryness.
  • Temperatures were warmer than usual in center west Brazil during the past week while parts of the northeast and far south were milder than usual.
  • The forecast over the next ten days is for sporadic rains across most production areas of Brazil.
  • Much of Brazil outside Bahia in the northeast will have several chances for rain during the coming week that will support the improving moisture trend.
  • Temperatures are expected to moderate and be near to below average during this time.

FBN’s Take On What It Means: Rainfall was widely varied across Brazil during the past week. Many of the drier areas still have sufficient subsoil moisture to protect early planted crops, but rain is needed for the more recently planted crops. The driest area is the center west in parts of Goias and Mato Grosso where the need for more significant rain is greater than other states. Timely rain will continue to be needed to support crop development, especially for soybean pod filling into the month-end.

FBN

Biofuel Groups File Appeal

  • A biofuel coalition filed a brief with the D.C. Circuit Court of Appeals challenging the 2019 decision to grant refineries exemptions from biofuel blending obligations.
  • In January, a lower court sided with the biofuel industry and cast doubt on the legitimacy of the waiver program.
  • The biofuel group claims the waivers hurt demand for ethanol, while the oil industry contends the exemptions are needed to help small refineries.
  • President-elect Biden plans to nominate former Iowa Governor Tom Vilsack for agriculture secretary.
  • Vilsak was agriculture secretary under Obama and is seen as an advocate for increased biofuel usage.
  • Biden is on record as wanting to move away from dependence on fossil fuels.

FBN’s Take On What It Means: Waivers that exempted oil refiners from obligations to use corn-based ethanol have been a sore spot for the Trump administration as the policy pitted two of his constituencies against each other. The incoming administration is likely to be more solidly behind biofuel production and usage. More strict adherence to ethanol blending requirements may help to offset some of the demand lost due to the coronavirus slowdown.

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Kevin McNew

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Magazine

Marketwatch: Jan, 18

US Corn Price Idx: ZCPAUS.CM

open: 5.7667
high: 5.8486
low: 5.7266
close: 5.8288

US Soybean Price Idx: ZSPAUS.CM

open: 13.366
high: 13.376
low: 13.2328
close: 13.2696

US Hard Red Winter Wheat Price Idx: KEPAUS.CM

open: 7.3061
high: 7.3384
low: 7.2334
close: 7.2454

US Soft Red Winter Wheat Price Idx: ZWPAUS.CM

open: 7.0114
high: 7.0566
low: 6.9566
close: 7.0014