Recent Biofuels Analysis
Delayed RVOs Leads to Pushing Back RFS Compliance Deadlines
Recently, WPI reported on the Subcommittee on Commodity Exchanges, Energy, and Credit hearing about the timeline for the required volume obligations (RVOs) from EPA. We noted that Growth Energy, a biofuel trade association, informed EPA via a 2 November letter of its intent to file suit if...
SPR Release Turns Out to be Bullish
President Biden ordered the release of 50 million barrels of crude oil from the Strategic Petroleum Reserves (SPR) to ease gas prices. The release will be in the form of a 32-million-barrel exchange solicitation to be open for bids tomorrow and the accelerating of 18 million-barrel to be sold w...
Where’s the RVO?
The House Agriculture Committee’s Subcommittee on Commodity Exchanges, Energy, and Credit held a hearing today on the “Renewable Economy in Rural America.” Emily Skor, CEO of Growth Energy, a biofuel trade association, mentioned in her testimony that “We are also a...
October Ethanol Production a Blip Not a Trend According to EIA
Last week’s WASDE raised the outlook for corn used in ethanol production by 50 million bushels based on September data from USDA’s Grain Crushings and Co-Products Production report and weekly ethanol production data as reported by the Energy Information Administration (EIA) for the...
Market Commentary: CBOT Lower in Consolidation, Profit Taking; Livestock Markets Rally
The CBOT ended lower Wednesday as profit taking and risk-off trade occurred ahead of next week’s WASDE report. World ag markets were overbought after months of rallies and needed to “cool off”. December Paris milling wheat futures were down €3/MT today and pulled back fro...
Bullish Ethanol Production
USDA released the September Grain Crushings report today; total corn use for fuel alcohol was down 2 percent from August, but up 1 percent from September 2020, starting the marketing year off in the right direction. Moreover, ethanol production for the week ending 22 October hit 1.106 million b...
Private R&D Leads; Energy Confusion
Private R&D Leads Proponents of public sector agricultural R&D have typically touted the high rate of return on such investments and lamented that this spending category has been relatively flat for many years. This ignores that fact that private spending on agricultural R&D has bee...
Actions Louder than Words; China Faces WTO
Actions Louder than Words The Sixth Assessment Report from the Intergovernmental Panel on Climate Change was released in August and the associated COP26 meeting begins at the end of October in Glasgow. Leaders gathered there will likely review the UN Environment Program’s released Product...
High-Cost Energy/Ag Inputs Forecast
The U.S. Energy Information Administration (EIA) released its winter fuels outlook last week, forecasting rising prices for several key agricultural inputs. First, natural gas will continue pushing up nitrogen fertilizer prices. While there are a number of factors at play in fertil...
Ongoing Biofuel Demand
The U.S. Energy Information Agency published its latest forecast for energy use through 2050 and it foresees no slackening in demand. Its projection for demand for petroleum and other liquid fuels only varies based on assumptions about economic growth and petroleum prices. This projection does...
Ethanol Exports Up in August, but Still Missing Brazil
After dropping in July to the lowest level since October 2013, August ethanol exports shot back up in August, increasing about 55 percent. However, the August exports were still down about 17 percent from last year and from the previous five-year average for the month. Year-to-date exports (th...
Ag Review - September 2021
For 23 years, WPI’s monthly AgReview publication has provided in-depth analysis of markets and policy. Responding to changes in both business economics and clients’ needs, this will be our last edition. We will continue to include historical analysis with our successful daily Ag Per...
Senator Grassley on RVOs: “Worst Week in Washington for Ethanol Ever”
There are more rumors circulating about potential cuts in the require volume obligations (RVOs) for biofuels. Those stories have certainly gained the attention of industry supporters on Capitol Hill, especially Senator Chuck Grassley (R-Iowa). There have been rumors for months that...
Summary of Futures
Dec 21 Corn closed at $5.2675/bushel, down $0.025 from yesterday's close. Dec 21 Wheat closed at $7.2375/bushel, up $0.06 from yesterday's close. Nov 21 Soybeans closed at $12.85/bushel, up $0.0075 from yesterday's close. Dec 21 Soymeal closed at $339/short ton, down $1.1 from...
Will Biofuels Go Sky High in Taking to the Air?
The Biden Administration last week announced an effort to lower carbon emissions in aviation, targeting a 20 percent drop in aviation emissions by 2030 and the “potential for a fully zero-carbon aviation sector by 2050.” That would be 3 billion gallons annual use by 2030, and potent...
Will Coming RVOs be a 2013-2016 Redux?
The 2021 and 2022 proposed RVOs, developed by EPA, have been under review at the Office of Management and Budget (OMB) for a week. As we reported last Friday, the proposal was sent from EPA for review last Thursday. What is in the proposal is still a mystery, however. That differs from last yea...
RFS Volume Rule Under Review: Going Retro for 2020
We reported on Monday that the EPA would be sending its 2022, and never finalized 2021, proposed required volume obligations (RVO) under the renewable fuel standard to the Office of Management and Budget (OMB) for review. The question was when? We now know the answer: yesterday. There has been...
Biofuel Falters
U.S. biofuel makers are disappointed that U.S. EPA is not more aggressively pushing fuel blending, but their plight is consistent with the pandemic related faltering in global biofuel production. The International Energy Agency (EIA) says that 10 percent annual increases are needed in global bi...
Ball of Confusion: Waiting on RFS Volumes
The EPA will be sending its 2022, and never finalized 2021, proposed required volume obligations (RVO) under the renewable fuel standard to the Office of Management and Budget (OMB) for review. The question is: when? As of this morning, there is no record of the proposal being sent to OMB for f...
PM Post - Bears Own the Day
THE OPEN Nov beans: 18 lower Dec meal: 4.00 lower Dec soyoil: 96 pts lower Dec corn: 9 lower Dec wheat: 12 lower The markets opened as expected but weaker outside markets, bearish Pro Farmer Crop tour comments, and rains forecasted for the weekend took a toll on th...
Black Sea Regional Analysis
Russian Grain Markets: 9-13 August 2021 The domestic Russian grain market grew significantly in all regions of the European part of Russia (except for corn prices), mainly due to the USDA report with worse forecasts than expected. Export milling wheat average price increased to $295/MT FOB Blac...
Short Term Energy Outlook: Bullish Biodiesel
The Energy Information Administration (EIA) released its August Short-Term Energy Outlook (STEO); the report projects biodiesel production for 2021 to remain at the same level as 2020, which unlike ethanol, was up from 2019. For 2022, biodiesel production is forecast to increase 15 percent over...
GMO Tipping Point; One-Way Ethanol; Opium or Food?
GMO Tipping Point They do not call it genetic modification because of all the negative baggage associated with the first wave of organisms modified to be better. The technologies that have evolved from originally inserting a gene into DNA instead have a trendier moniker, new genomic techniques...
Long Term Ethanol Question: Electric Vehicles – Fact or Fantasy?
Last week, President Biden issued an executive order as part of his “Build Back Better” initiative that calls for targeting all vehicle sales to reach 50 percent electric vehicles by 2030. Specifically, setting the goal of “half of all new vehicles sold in 2030 zero-emissions...
Delayed RVOs Leads to Pushing Back RFS Compliance Deadlines
Recently, WPI reported on the Subcommittee on Commodity Exchanges, Energy, and Credit hearing about the timeline for the required volume obligations (RVOs) from EPA. We noted that Growth Energy, a biofuel trade association, informed EPA via a 2 November letter of its intent to file suit if...
SPR Release Turns Out to be Bullish
President Biden ordered the release of 50 million barrels of crude oil from the Strategic Petroleum Reserves (SPR) to ease gas prices. The release will be in the form of a 32-million-barrel exchange solicitation to be open for bids tomorrow and the accelerating of 18 million-barrel to be sold w...
Where’s the RVO?
The House Agriculture Committee’s Subcommittee on Commodity Exchanges, Energy, and Credit held a hearing today on the “Renewable Economy in Rural America.” Emily Skor, CEO of Growth Energy, a biofuel trade association, mentioned in her testimony that “We are also a...
October Ethanol Production a Blip Not a Trend According to EIA
Last week’s WASDE raised the outlook for corn used in ethanol production by 50 million bushels based on September data from USDA’s Grain Crushings and Co-Products Production report and weekly ethanol production data as reported by the Energy Information Administration (EIA) for the...
Market Commentary: CBOT Lower in Consolidation, Profit Taking; Livestock Markets Rally
The CBOT ended lower Wednesday as profit taking and risk-off trade occurred ahead of next week’s WASDE report. World ag markets were overbought after months of rallies and needed to “cool off”. December Paris milling wheat futures were down €3/MT today and pulled back fro...
Bullish Ethanol Production
USDA released the September Grain Crushings report today; total corn use for fuel alcohol was down 2 percent from August, but up 1 percent from September 2020, starting the marketing year off in the right direction. Moreover, ethanol production for the week ending 22 October hit 1.106 million b...
Private R&D Leads; Energy Confusion
Private R&D Leads Proponents of public sector agricultural R&D have typically touted the high rate of return on such investments and lamented that this spending category has been relatively flat for many years. This ignores that fact that private spending on agricultural R&D has bee...
Actions Louder than Words; China Faces WTO
Actions Louder than Words The Sixth Assessment Report from the Intergovernmental Panel on Climate Change was released in August and the associated COP26 meeting begins at the end of October in Glasgow. Leaders gathered there will likely review the UN Environment Program’s released Product...
High-Cost Energy/Ag Inputs Forecast
The U.S. Energy Information Administration (EIA) released its winter fuels outlook last week, forecasting rising prices for several key agricultural inputs. First, natural gas will continue pushing up nitrogen fertilizer prices. While there are a number of factors at play in fertil...
Ongoing Biofuel Demand
The U.S. Energy Information Agency published its latest forecast for energy use through 2050 and it foresees no slackening in demand. Its projection for demand for petroleum and other liquid fuels only varies based on assumptions about economic growth and petroleum prices. This projection does...
Ethanol Exports Up in August, but Still Missing Brazil
After dropping in July to the lowest level since October 2013, August ethanol exports shot back up in August, increasing about 55 percent. However, the August exports were still down about 17 percent from last year and from the previous five-year average for the month. Year-to-date exports (th...
Ag Review - September 2021
For 23 years, WPI’s monthly AgReview publication has provided in-depth analysis of markets and policy. Responding to changes in both business economics and clients’ needs, this will be our last edition. We will continue to include historical analysis with our successful daily Ag Per...
Senator Grassley on RVOs: “Worst Week in Washington for Ethanol Ever”
There are more rumors circulating about potential cuts in the require volume obligations (RVOs) for biofuels. Those stories have certainly gained the attention of industry supporters on Capitol Hill, especially Senator Chuck Grassley (R-Iowa). There have been rumors for months that...
Summary of Futures
Dec 21 Corn closed at $5.2675/bushel, down $0.025 from yesterday's close. Dec 21 Wheat closed at $7.2375/bushel, up $0.06 from yesterday's close. Nov 21 Soybeans closed at $12.85/bushel, up $0.0075 from yesterday's close. Dec 21 Soymeal closed at $339/short ton, down $1.1 from...
Will Biofuels Go Sky High in Taking to the Air?
The Biden Administration last week announced an effort to lower carbon emissions in aviation, targeting a 20 percent drop in aviation emissions by 2030 and the “potential for a fully zero-carbon aviation sector by 2050.” That would be 3 billion gallons annual use by 2030, and potent...
Will Coming RVOs be a 2013-2016 Redux?
The 2021 and 2022 proposed RVOs, developed by EPA, have been under review at the Office of Management and Budget (OMB) for a week. As we reported last Friday, the proposal was sent from EPA for review last Thursday. What is in the proposal is still a mystery, however. That differs from last yea...
RFS Volume Rule Under Review: Going Retro for 2020
We reported on Monday that the EPA would be sending its 2022, and never finalized 2021, proposed required volume obligations (RVO) under the renewable fuel standard to the Office of Management and Budget (OMB) for review. The question was when? We now know the answer: yesterday. There has been...
Biofuel Falters
U.S. biofuel makers are disappointed that U.S. EPA is not more aggressively pushing fuel blending, but their plight is consistent with the pandemic related faltering in global biofuel production. The International Energy Agency (EIA) says that 10 percent annual increases are needed in global bi...
Ball of Confusion: Waiting on RFS Volumes
The EPA will be sending its 2022, and never finalized 2021, proposed required volume obligations (RVO) under the renewable fuel standard to the Office of Management and Budget (OMB) for review. The question is: when? As of this morning, there is no record of the proposal being sent to OMB for f...
PM Post - Bears Own the Day
THE OPEN Nov beans: 18 lower Dec meal: 4.00 lower Dec soyoil: 96 pts lower Dec corn: 9 lower Dec wheat: 12 lower The markets opened as expected but weaker outside markets, bearish Pro Farmer Crop tour comments, and rains forecasted for the weekend took a toll on th...
Black Sea Regional Analysis
Russian Grain Markets: 9-13 August 2021 The domestic Russian grain market grew significantly in all regions of the European part of Russia (except for corn prices), mainly due to the USDA report with worse forecasts than expected. Export milling wheat average price increased to $295/MT FOB Blac...
Short Term Energy Outlook: Bullish Biodiesel
The Energy Information Administration (EIA) released its August Short-Term Energy Outlook (STEO); the report projects biodiesel production for 2021 to remain at the same level as 2020, which unlike ethanol, was up from 2019. For 2022, biodiesel production is forecast to increase 15 percent over...
GMO Tipping Point; One-Way Ethanol; Opium or Food?
GMO Tipping Point They do not call it genetic modification because of all the negative baggage associated with the first wave of organisms modified to be better. The technologies that have evolved from originally inserting a gene into DNA instead have a trendier moniker, new genomic techniques...
Long Term Ethanol Question: Electric Vehicles – Fact or Fantasy?
Last week, President Biden issued an executive order as part of his “Build Back Better” initiative that calls for targeting all vehicle sales to reach 50 percent electric vehicles by 2030. Specifically, setting the goal of “half of all new vehicles sold in 2030 zero-emissions...