China to Release Potash Reserves
China has decided to release potash reserves as a measure to stabilize domestic fertilizer supplies and prices.
Chinese potash prices have jumped this year, up 61% over the first half of the year.
In addition to releasing reserves, China is directing companies to prioritize supply of raw materials, energy, and logistics to fertilizer suppliers.
The country relies on imports for about half of its total annual demand.
FBN’s Take On What It Means For The Farmer: Like urea and other agricultural inputs, potash has also seen historical price gains. Even with the release of reserves, public and private experts expect input prices to continue to be elevated for the foreseeable future, though the exact implications are not clear. China will also begin to auction off oil reserves later this week.
Biden Administration Considers Biofuels Mandate Cuts
Reuters reported that the Biden Administration is mulling large cuts to biofuel blending requirements.
If adopted, the move would be a win for oil and anger ethanol producers and corn farmers.
2020 and 2021 mandates would be cut to 17.1 billion and 18.6 billion gallons respectively; this would be lower than the 20.1 billion level set for 2020 before the pandemic.
The price for D6 RINS, renewable fuel credits used to track compliance, fell after the news was reported.
FBN’s Take On What It Means: While the pandemic has hurt oil refiners and biofuel producers alike, the prices of RINS jumped this year. Refinery advocates have pointed to this price jump as a reason to relieve some of the mandates. The mandate numbers are not final, and they are currently under review by the Office of Management and Budget. Biofuel and corn industry advocates vowed to fight the change.
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