Good morning,

Corn is unchanged and soybeans are up 7 to start this Friday off.

In yesterday’s Supply and Demand Report, the USDA made no adjustments for corn and beans, while they increased the wheat carryout by 20 million bushels. They might as well have taken this one off as they hardly did anything anyway.

A Reuters report cited “trade sources” saying China has made large purchases of feed grains from Ukraine, France, and Australia in the past week; French wheat purchases totaled 600k mt for Jan-March, while barley purchases were estimated at 14 vessels combined from France and Ukraine. China also reportedly bought ten or more cargoes of corn from Ukraine for Jan/April, with some estimating those purchases ranging up to a million tonnes.  China has bought over 1.25 mmt of Aussie wheat in the last two weeks.

$5.50-$6 corn is going to continue to make it difficult for the US to compete in the Chinese export market. We are at a disadvantage logistically to both the Ukraine and South America on top of these current price levels. Our export business is going to be reliant on Canada and Mexico for the majority of the year. Canada is estimated to be more than 50% covered on what they need to buy so the story on this market may die quicker than we hope.

I would advise producers to get sales and firm offers on the books with end users ASAP. We are coming off the second largest harvest on record and do not expect to see the demand pop up like last year. There may be room to move slightly higher, but unlike 2021 we are starting off at $5.90-$6.00 cbot levels compared to $4 last year.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didioninc.com

Good morning,

Markets are all over the board this morning with traders moving ahead of the 11am report. Corn is currently up 3 and soybeans are down 6.

The USDA Crop Report is out today 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.
Total U.S. ethanol fuel production rebounded to 1.090 million barrels per day on the seven days ending December 3rd, up from 1.035 mln bpd the week prior, and 991k bpd on the comparable week last year. Cumulative output since Sept 1 continues to rise, now up to an average of 1.023 mln bpd; if that number keeps up with previous seasons (and ‘19/20 pre-pandemic) to hit even 1.040 mln bpd by the end of Aug, that would indicate corn use for ethanol around the 5.5 bln bu mark—250 million bu above the current USDA est.
Here are todays trade estimates:

USDA 2021/22 US Grain Ending Stocks (million bu)

USDA 2021/22 World Grain Ending Stocks(million tonnes)

Check back after 11am for updated numbers.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didioninc.com

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

920-348-6844

ggard@didioninc.com

Good morning,

Markets are softer this morning with corn down 3 and soybeans down 5.

There wasn’t much news in the market session yesterday and its even less so far today. These are about the quietest overnight trades in corn, beans, and wheat we have seen for a long time.  There is no new bearish input, but we still lack any bullish catalyst. Crude oil cracked 70 dollars this morning which puts it 7 dollars off the recent low and 15 dollars off the high. Ethanol markets have slipped in the last week which may have plants refiguring their Q1 plans if things don’t stabilize.

The EPA’s latest proposal to extend the deadlines for compliance dates under the Renewable Fuel Standard program has sparked some protests from groups representing the renewable fuels sector. “What we see is an admission that EPA will miss the statutory deadlines going forward, while making it easier to do so,” says Kate Shenk of the National Biodiesel Board. “EPA is acting as if there is no statutory deadline for promulgating annual rules.” Grains traders were looking for the EPA to release its new rules last week, and the lack of any new rules being released put pressure on corn and soybean futures. Both CBOT contracts are down again today, with corn down 0.9% and soybeans down 0.6%.
The White House said on Monday US government officials would boycott the Winter Olympics in Beijing.  China opposes the boycott and would take “resolute countermeasures”, foreign ministry spokesman Zhao Lijian told a regular media briefing in Beijing, host city of the 2008 Summer Olympics, on Tuesday.  “The United States will pay a price for its mistaken acts,” he said, without giving details. “Let’s all wait and see.”

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didioninc.com

Good morning,

Softer markets to start the week with corn down 5 and soybeans down 6.

Canada’s main crop came in above trade expectations in StatsCan’s December crop report on Friday, with all-wheat output at 21.7 MMT; that was 500k tonnes above the trade guess but still only steady with their previous projection, and their worst wheat crop since ‘07/08. Production of those six main crops (combined below) stands at just over 64 MMT for 2021, down from a record pushing 90 MMT in 2020 and the lightest output since the ‘07/08 season.

The forecast for South American weather looks unchanged from yesterday.  Northern Brazil will have chances for 2-5 inches of rain this week. Southern Brazil and most of Argentina didn’t get much rain coverage over the weekend. Southern Argentina is expected to see .1-1.25 inches into Friday. Temps in Northern Brazil are below normal and temps in Argentina are heating up.

The USDA will release their monthly S&D report on Thursday. Trade expectations are for slightly lower stocks due to an increased ethanol demand number. 2021 production numbers will not be updated until the final report in January.

Look for the markets to continue their sideways trading range as we have nothing bearish or bullish going on in the marketplace.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didioninc.com