Good morning,

Corn is unchanged and soybeans are up 1 to start the day.

The USDA Crop Report is out tomorrow at 11:00 Central. Only minor adjustments are expected as this report has little bearing on the markets. South American production doesn’t move very far this early and those crop sizes are expected to be unchanged. Traders are looking for a small reduction in bean and wheat exports, with an increase in the corn grind from ethanol.

The December Trade Report showed US soybean exports for October at 386 million bushels.  This is 42 million below last year’s record large sales and the second highest of all time. November is expected to be similar, with also the second largest sales of all time. China is behind 180 million bushels due to the September shutdown at the US Gulf. Overall sales are probably only down 240 million bushels from year to year, with many months to bridge some of that gap.

The U.S. EPA will reportedly reduce biofuel mandates, aiding refiners hit by the pandemic; annual ethanol mandates will go to 12.6 billion gallons for 2020, 13.8 billion for 2021, and 15.0 billion for 2022 (back to originally – mandated levels). The rejection of a significant number of small refinery exemptions is also expected by the EPA. The Biden Administration did announce $700 million in COVID-related biofuel industry grants at the same time, along with $100 million in biofuel infrastructure aid.

The forecast for South American weather looks unchanged. Northern Brazil will have chances for 2-5 inches of rain this week. Southern Brazil and Northern Argentina will be largely dry of the coming 10-15 days. Southern Argentina is expected to see .1-1.25 inches into Friday. Temps in Northern Brazil are normal and temps in Argentina are above normal.

Look for quiet markets today as traders will focus on the EPA announcement and tomorrows USDA report.



Have a Safe Day!


Garry Gard