Recent Biofuels Analysis
Market Commentary
Statistics Canada released its initial estimates, which are based on surveys conducted last month, of planted area for 2019. Much like the U.S., they show a decline in oilseed plantings and an increase for grains. With the de facto Chinese embargo on Canadian canola weighing heavily on prices,...
China In-Country Analysis
Marco Trends March Economic Data Points to Effects of Stimulus and ASF In response to a sharp economic slowdown and the ongoing impact of the trade war with the U.S., China launched a series of stimulative measures at the end of 2018. After a tepid January and February, the country’s econ...
Ethanol Growth Faces Mixed Bag of RFS Regulations
According to data released late last week, the EPA has granted one additional small refinery exemption (SRE) for 2017 and received three more SRE requests for 2018 since the last reported update (see table below for current counts). The additional SRE for 2017 was from a very small refinery as...
Shrinking Future of the RFS
Sometime in the next six to eight weeks, the EPA will propose the Required Volume Obligations (RVOs) for 2020 under the Renewable Fuel Standard (RFS). The statutory volumes will then be prescribed for only the two following years (2021 and 2022), and the EPA will thereafter have greater discret...
EIA Forecasts on Biofuels
The U.S. Energy Information Administration (EIA) released its monthly Short-Term Energy Outlook (STEO) this week. The agency trimmed back both production and consumption projections for biodiesel. On the production side, EIA cut its forecast for 2019 by 7 percent and for 2020 by 9 percent versu...
Market Commentary
Such changes as were made in yesterday’s April WASDE were uniformly bearish – lower use, larger stocks, bigger South American production, more competition for U.S. grain and soy exports, etc. However, the report contained little that was not expected. Grain and soy markets hardly re...
China In-Country Analysis
Oilseeds Soymeal Inventory Reverses Course as Feed Demand Improves Modest improvements in feed demand last week coupled with a drop in imported soybean stocks resulted in China’s estimated soymeal inventory declining yet again to a total 608,400 MT as of 4 April 2019, down 23,800 MT (-3.8...
Wet Weather Impacting Ethanol
Ethanol producers were already dealing with building inventories, lower blending rates and cheaper crude oil (U.S. crude production was up 17 percent in 2018). Now the recent flooding has impacted 10-15 percent of ethanol production in Nebraska, Iowa and South Dakota. The biggest impact has bee...
Oilseed Highlights: WASDE; EU to Face Retaliation; Maple Leaf Foods;, French Rapeseed
Relatively Few Significant Changes to Soy Sector in WASDE USDA made very few changes to its supply and distribution tables for the soy sector in the April WASDE, but among the few significant revisions to its estimates were the following: - Brazil’s 2018 soybean crop was raised from 120.0...
Politics of the Biodiesel Tax Credit
With the second quarter of 2019 underway, the House is moving toward a restoration of the biodiesel tax credit (BTC), which expired 31 December 2017. A bill, co-sponsored by a bipartisan group of legislators, was introduced in that chamber to implement the credit through 2019 and extend it retr...
Market Commentary
It was another day of quiet, low volume, wait-and-see trade in grain and soy complex futures. Prices were a bit higher across the board overnight, but they turned to more of a mixed stance during the day session as most contracts traded on both sides of Tuesday’s closes. At the end, Chica...
Ag Review - March 2019
WPI's monthly publication features analyses of U.S. agribusinesses, outlooks for the U.S. soybean crush and U.S. biofuels industry, and an assessment of certain global trade policies. It also provides a review of agribusiness stock prices along with expectations for future performance...
Market Commentary
Last night’s session produced a story similar to that told by overnight trade of grain and soy futures for much of the last few weeks – mixed price action, limited price movement and low trading volume. Corn and soybeans were 1-2 cents lower, while wheat managed to hang onto a small...
China In-Country Analysis
Livestock China’s Average Live Pig Price Soared 12 Percent Through Mid-March With all the chaos surrounding African swine fever (ASF), the publishing of weekly price data from 500 farm markets across China by the Ministry of Agriculture and Rural Affairs (MARA) appears to be unnecessarily...
Flooding Gives Bump to Ethanol, but for How Long?
The weather markets have hit ethanol, providing some welcomed price relief. The flooding in the Corn Belt has interrupted shipping/delivery and given a bump to ethanol prices, especially on the West Coast. Right now, producer margins are improved, and blender margins are tighter. Gasoline price...
Market Commentary
It has been more low and slow trade overnight and again today. Wheat is the star of the day with the May contracts for Chicago and KC both closing up 8.25 cents and that for MGEX finishing 6.25 cents higher. Low trading volume can often result in abrupt and sharp price movements as market order...
China In-Country Analysis
Export Trends Year-End USDA Data Shows Trade Winners and Losers Following delays caused by the 35-day partial U.S. government shutdown, USDA has now managed to update its reports regarding U.S. agricultural exports through the end of 2018. A look at the total figures reveal some surprising find...
Chinese Trade Soap Opera and Markets
Having commented so often about U.S.-China trade relations and the ongoing negotiations, we fear we risk boring clients. However, the trade negotiations are reminiscent of the traditional “soap operas” on daytime television in that their stories never end. Every time one crisis is r...
More Small Refinery Exemptions Granted
The EPA announced yesterday that it had granted five additional small refinery exemptions (SREs) for 2017, reducing the number of pending petitions in the queue for that year as of 1 March from seven to two. This brings the total number of exemptions to 9.4 percent of the 19.28 billion gallons...
Oilseed Highlights: U.S. Soy Export Sales; EU Biodiesel, Palm Oil Futures; EU Rapeseed
U.S. Soy Export Sales Highlights Today’s USDA weekly export sales report indicated U.S. exporters were quite successful selling soybeans to China and elsewhere in the week ending 7 March. Meanwhile, soymeal and soyoil export sales were relatively modest. Net soybean export sales for shipm...
Year-Round E15 and RIN Reform Proposed; Annual Ethanol Use Down
Year-Round E15 and RIN Reform Proposed The EPA released its proposed waiver for year-round E15 use today. As previously reported (click here), it will now be on a tight approval deadline before the summer driving season starts. Given the risk of regulatory uncertainty and needed infrastructure...
Market Commentary
Yesterday’s firmer market did not have the legs to carry over into the night session. Grain and soybean values turned lower in overnight trade with corn futures down a fraction, soybeans off 1-2 cents and Chicago wheat down about 4 cents. Trading volume was again quite low. The price weak...
E15; Biodiesel Duties; The Debt Limit
E15 and SREs Yesterday the EPA submitted its proposal for year-round E15 use to the Office of Management and Budget (OMB) for sign-off. As noted here on Friday, a quick timeline for approval could be 75 days, which is slightly less than the number of days before the 1 June start of the su...
Market Commentary
Corn and soybean futures were higher in the Sunday evening session with wheat steady, and that is the way the market opened this morning as well. There was renewed optimism that the U.S. and China are very close to reaching an agreement on trade. President Trump has reportedly asked the Chinese...
Market Commentary
Statistics Canada released its initial estimates, which are based on surveys conducted last month, of planted area for 2019. Much like the U.S., they show a decline in oilseed plantings and an increase for grains. With the de facto Chinese embargo on Canadian canola weighing heavily on prices,...
China In-Country Analysis
Marco Trends March Economic Data Points to Effects of Stimulus and ASF In response to a sharp economic slowdown and the ongoing impact of the trade war with the U.S., China launched a series of stimulative measures at the end of 2018. After a tepid January and February, the country’s econ...
Ethanol Growth Faces Mixed Bag of RFS Regulations
According to data released late last week, the EPA has granted one additional small refinery exemption (SRE) for 2017 and received three more SRE requests for 2018 since the last reported update (see table below for current counts). The additional SRE for 2017 was from a very small refinery as...
Shrinking Future of the RFS
Sometime in the next six to eight weeks, the EPA will propose the Required Volume Obligations (RVOs) for 2020 under the Renewable Fuel Standard (RFS). The statutory volumes will then be prescribed for only the two following years (2021 and 2022), and the EPA will thereafter have greater discret...
EIA Forecasts on Biofuels
The U.S. Energy Information Administration (EIA) released its monthly Short-Term Energy Outlook (STEO) this week. The agency trimmed back both production and consumption projections for biodiesel. On the production side, EIA cut its forecast for 2019 by 7 percent and for 2020 by 9 percent versu...
Market Commentary
Such changes as were made in yesterday’s April WASDE were uniformly bearish – lower use, larger stocks, bigger South American production, more competition for U.S. grain and soy exports, etc. However, the report contained little that was not expected. Grain and soy markets hardly re...
China In-Country Analysis
Oilseeds Soymeal Inventory Reverses Course as Feed Demand Improves Modest improvements in feed demand last week coupled with a drop in imported soybean stocks resulted in China’s estimated soymeal inventory declining yet again to a total 608,400 MT as of 4 April 2019, down 23,800 MT (-3.8...
Wet Weather Impacting Ethanol
Ethanol producers were already dealing with building inventories, lower blending rates and cheaper crude oil (U.S. crude production was up 17 percent in 2018). Now the recent flooding has impacted 10-15 percent of ethanol production in Nebraska, Iowa and South Dakota. The biggest impact has bee...
Oilseed Highlights: WASDE; EU to Face Retaliation; Maple Leaf Foods;, French Rapeseed
Relatively Few Significant Changes to Soy Sector in WASDE USDA made very few changes to its supply and distribution tables for the soy sector in the April WASDE, but among the few significant revisions to its estimates were the following: - Brazil’s 2018 soybean crop was raised from 120.0...
Politics of the Biodiesel Tax Credit
With the second quarter of 2019 underway, the House is moving toward a restoration of the biodiesel tax credit (BTC), which expired 31 December 2017. A bill, co-sponsored by a bipartisan group of legislators, was introduced in that chamber to implement the credit through 2019 and extend it retr...
Market Commentary
It was another day of quiet, low volume, wait-and-see trade in grain and soy complex futures. Prices were a bit higher across the board overnight, but they turned to more of a mixed stance during the day session as most contracts traded on both sides of Tuesday’s closes. At the end, Chica...
Ag Review - March 2019
WPI's monthly publication features analyses of U.S. agribusinesses, outlooks for the U.S. soybean crush and U.S. biofuels industry, and an assessment of certain global trade policies. It also provides a review of agribusiness stock prices along with expectations for future performance...
Market Commentary
Last night’s session produced a story similar to that told by overnight trade of grain and soy futures for much of the last few weeks – mixed price action, limited price movement and low trading volume. Corn and soybeans were 1-2 cents lower, while wheat managed to hang onto a small...
China In-Country Analysis
Livestock China’s Average Live Pig Price Soared 12 Percent Through Mid-March With all the chaos surrounding African swine fever (ASF), the publishing of weekly price data from 500 farm markets across China by the Ministry of Agriculture and Rural Affairs (MARA) appears to be unnecessarily...
Flooding Gives Bump to Ethanol, but for How Long?
The weather markets have hit ethanol, providing some welcomed price relief. The flooding in the Corn Belt has interrupted shipping/delivery and given a bump to ethanol prices, especially on the West Coast. Right now, producer margins are improved, and blender margins are tighter. Gasoline price...
Market Commentary
It has been more low and slow trade overnight and again today. Wheat is the star of the day with the May contracts for Chicago and KC both closing up 8.25 cents and that for MGEX finishing 6.25 cents higher. Low trading volume can often result in abrupt and sharp price movements as market order...
China In-Country Analysis
Export Trends Year-End USDA Data Shows Trade Winners and Losers Following delays caused by the 35-day partial U.S. government shutdown, USDA has now managed to update its reports regarding U.S. agricultural exports through the end of 2018. A look at the total figures reveal some surprising find...
Chinese Trade Soap Opera and Markets
Having commented so often about U.S.-China trade relations and the ongoing negotiations, we fear we risk boring clients. However, the trade negotiations are reminiscent of the traditional “soap operas” on daytime television in that their stories never end. Every time one crisis is r...
More Small Refinery Exemptions Granted
The EPA announced yesterday that it had granted five additional small refinery exemptions (SREs) for 2017, reducing the number of pending petitions in the queue for that year as of 1 March from seven to two. This brings the total number of exemptions to 9.4 percent of the 19.28 billion gallons...
Oilseed Highlights: U.S. Soy Export Sales; EU Biodiesel, Palm Oil Futures; EU Rapeseed
U.S. Soy Export Sales Highlights Today’s USDA weekly export sales report indicated U.S. exporters were quite successful selling soybeans to China and elsewhere in the week ending 7 March. Meanwhile, soymeal and soyoil export sales were relatively modest. Net soybean export sales for shipm...
Year-Round E15 and RIN Reform Proposed; Annual Ethanol Use Down
Year-Round E15 and RIN Reform Proposed The EPA released its proposed waiver for year-round E15 use today. As previously reported (click here), it will now be on a tight approval deadline before the summer driving season starts. Given the risk of regulatory uncertainty and needed infrastructure...
Market Commentary
Yesterday’s firmer market did not have the legs to carry over into the night session. Grain and soybean values turned lower in overnight trade with corn futures down a fraction, soybeans off 1-2 cents and Chicago wheat down about 4 cents. Trading volume was again quite low. The price weak...
E15; Biodiesel Duties; The Debt Limit
E15 and SREs Yesterday the EPA submitted its proposal for year-round E15 use to the Office of Management and Budget (OMB) for sign-off. As noted here on Friday, a quick timeline for approval could be 75 days, which is slightly less than the number of days before the 1 June start of the su...
Market Commentary
Corn and soybean futures were higher in the Sunday evening session with wheat steady, and that is the way the market opened this morning as well. There was renewed optimism that the U.S. and China are very close to reaching an agreement on trade. President Trump has reportedly asked the Chinese...