Grain Markets and Other Stuff

Joe Vaclavik

Joe Vaclavik and Mackenzie Johnston discuss the grain markets, the business of farming, news related to agriculture, and a variety of other topics.

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5 of 1371

Is 45Z Dead? + Wetter Argentina Forecast
Joe's Premium Subscription: www.standardgrain.comGrain Markets and Other Stuff Links-Apple PodcastsSpotifyTikTokYouTubeFutures and options trading involves risk of loss and is not suitable for everyone.A bipartisan group of senators has reintroduced the Farm to Fly Act to speed up the production of SAF. The legislation would clarify SAF eligibility in the USDA's current bioenergy programs and expand markets for crops used in SAF production. It would also clarify the federal definition of SAF for USDA purposes and promote more collaboration on aviation biofuels within the USDA. Six senators from the Midwest reintroduced the bill. Agriculture, aviation, and energy groups have all expressed support for the legislation. The reintroduction came one day after President Donald Trump signed an executive order freezing any new federal rules for 60 days, including the 45Z tax credit guidance.USDA reported a flash sale of corn on Wednesday. US exporters sold 136,000mt (5mil bushels) of corn to unknown destinations for delivery during the 2024/2025 marketing year. Current marketing year corn sales are the third best in the last ten years.China has suspended Brazilian soybean shipments from five companies. China's General Administration of Customs halted the shipments after finding pesticides and pests during a routine inspection. Authorities did not release the number of cargoes or the volume of soybeans affected by the suspension. However, the Brazilian Ministry of Agriculture reported that the ban is not expected to affect Brazil's overall soybean exports to China. The ministry is expected to provide China with the necessary information to lift the temporary suspensions. The firms included in the ban are some of the largest soybean suppliers to China.Weather forecasts for southern Brazil and Argentina have turned slightly wetter. Rains are slated to return to southern Brazil and northern Argentina by Sunday. Southern Brazil, in particular, should see widespread coverage during the next 5 days. The 5-10 day period introduces slightly better rainfall for key Argentina soybean areas. This morning's extended GFS model, however, is again drier for much of Argentina's soybean country. Despite the rain, parts of Argentina, including Buenos Aires, may remain drier than normal.President Donald Trump is pressuring Russia to negotiate an end to the war with Ukraine. On Wednesday, Trump said that Russia needs to make a deal to end the war, or the US will impose tariffs, higher taxes, and sanctions on Russian imports. The same would apply to other countries providing financial support to Russia. It's unclear which specific Russian goods would be targeted, but Russia's main oil producers could be included. Tariffs, however, won't be overly impactful given that the US only imported about $4.6 billion worth of Russian goods in 2023, accounting for only 0.2% of total imports.President Donald Trump's nominee for Agriculture Secretary previously opposed ethanol and farm subsidies. Brooke Rollins served as president and CEO of the Texas Public Policy Foundation from 2003 to 2018. During that time, the organization claimed that government support for ethanol led to an increase in emissions and a rise in food and fuel prices. In 2016, while Rollins remained in her position with the nonprofit, the group advocated for the elimination of farm subsidies. Despite Rollins' controversial history on policies affecting farmers, more than 400 state and national agricultural groups endorsed her to lead the USDA.
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13:44
Is China BACK?? (Corn Purchase Rumors)
Joe's Premium Subscription: www.standardgrain.comGrain Markets and Other Stuff Links-Apple PodcastsSpotifyTikTokYouTubeFutures and options trading involves risk of loss and is not suitable for everyone.0:00 Rumors and China3:27 Corn/Soybean Acreage Estimates6:47 China Tariffs on Feb 1st?8:24 South America Update10:25 Strong Corn Shipments🟢 US Corn Market Shows Positive Signs Amid China Rumors & Export Surge 🌽There were rumors on Tuesday regarding potential Chinese purchases of US corn, following a Monday announcement from the Chinese government indicating plans to increase the scale of corn purchases and expand grain storage. Despite China’s imports of US corn being near zero this year, the possibility of increased demand has positively impacted the corn market, with spot-month corn futures reaching their best levels since October 2023. 📈🌾📊 S&P Global Adjusts US Corn and Soybean Acreage Estimates 🌱S&P Global Commodity Insights has increased its forecast for US corn acreage to 93.5 million acres, a 700,000-acre increase from its previous estimate. This is a 2.9 million-acre increase compared to 2024. However, soybean acreage is expected to decrease by 700,000 acres, with the forecast now at 83.3 million acres. This aligns with USDA projections of 82.9 million acres for corn and 86.1 million acres for soybeans. 🌽🚨 Trump Considers Tariffs on China, Mexico, and Canada 💼President Donald Trump is weighing a 10% tariff on China as early as February 1, citing China’s role in the fentanyl trade. Trump is also considering a 25% tariff on imports from Mexico and Canada, with the aim of curbing illegal immigration and addressing trade concerns. These potential tariffs come on the heels of earlier proposals for a 60% tariff on Chinese goods. Traders are reacting to these ongoing developments, as tariffs could impact global trade and affect US exports. 💥🇧🇷 Brazil’s Soybean Crop Outlook Raised 🚜The Brazilian Association of Vegetable Oil Industries (ABIOVE) has raised its forecast for Brazil’s soybean crop to 171.7 million metric tons (mmt), up from 168.7mmt. Exports are expected to reach 106.1mmt, a 2.6mmt increase from previous estimates. Soybean crush is also expected to slightly rise to 57.1mmt. The US Department of Agriculture (USDA) forecasts Brazil’s crop at 169mmt, while Brazil’s crop agency Conab estimates 166.3mmt. 🌱🌍📦 US Corn Exports Surpass Expectations 📈US corn exports exceeded expectations last week, with 1.5mmt (61 million bushels) inspected for export during the week ending January 16. This marked a 6.9% increase compared to the prior week and a 106% increase compared to the same week in 2023. Meanwhile, soybean shipments were disappointing, falling to 973,145mt (36 million bushels), 28% lower than the previous week and 18% lower than last year. Wheat shipments also fell short, down 13% from the prior week.
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12:18
Disappointing Weekend Rains in Arg/Brazil + Tariff Latest
Joe's Premium Subscription: www.standardgrain.comGrain Markets and Other Stuff Links-Apple PodcastsSpotifyTikTokYouTubeFutures and options trading involves risk of loss and is not suitable for everyone.0:00 Argy Rains Disappoint2:11 Slow Brazil Harvest Start4:15 Tariff Update7:41 The Funds10:06 Soy Exports to China Decline11:36 Bitcoin and Trump Meme Coin🌧️ Weather Woes Continue for Argentina and Brazil 🌾While Argentina and southern Brazil received some rain over the weekend, soybean crops are still struggling with dryness in key areas. Argentina’s central soybean regions received up to 1" of rain, but much of the problem areas remained dry. Forecasts indicate that rainfall will stay scarce in the next 5 days, though better chances are expected later, based on the Euro model.In Brazil, the soybean harvest is facing its slowest pace in four years, with just 1.7% of the crop harvested as of last week, far behind 6% last year. Excessive rain in Mato Grosso has hindered progress, making this the slowest start to the harvest since the 2010/2011 season. This has also delayed planting for Brazil's second corn crop, with planting at just 0.3%, far below last year's 4.9%.💼 Trump Delays Immediate Tariff Action 🚨President Donald Trump has delayed the immediate implementation of tariffs on imports from Canada and Mexico, opting instead for a review of trade policies with China, Canada, and Mexico. The main focus is on ensuring that trade deals such as the USMCA and the Phase One trade deal with China are being adhered to. This delay offers some relief to those concerned about immediate tariff impacts, though Trump is still considering 25% tariffs by February 1st on goods from these countries.📈 Fund Positioning Shows Optimism in Corn & Soybean Markets 🌽"The Funds" have significantly increased their net-long positions in corn and soybean markets. For the week ending January 14, large money managers were net buyers of 48k corn contracts, bringing their total long position to 292k contracts, the largest since May 2022. Soybean markets also saw substantial buying, with 73k contracts purchased, making this the largest net long position in soybeans since November 2023. The funds were also net sellers of 5k contracts of SRW wheat, signaling more focus on corn and soybeans.🇨🇳 US & Brazil Soybean Exports Diverge 📉US soybean exports to China declined by 5.7% in 2024, reaching 22.1mmt, while Brazilian exports surged by 6.7% to 74.7mmt. As Brazil’s market share in China increased to 71%, the US share dropped to 21%. This shift reflects growing competition between the two countries. Argentina’s soybean exports to China also jumped, more than doubling to 4.1mmt. 🌍💰 Bitcoin Reaches New Heights Before Inauguration 🪙Bitcoin surged to a new all-time high, surpassing $109,000 early Monday, as President Donald Trump's administration is expected to create a pro-crypto regulatory environment. This surge in Bitcoin prices was fueled by anticipation of Trump’s potential crypto advisory council and the creation of a national Bitcoin reserve.
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14:54
US Farmers Sell TONS of Old Crop Corn: Right or Wrong??
Joe's Premium Subscription: www.standardgrain.comGrain Markets and Other Stuff Links-Apple PodcastsSpotifyTikTokYouTubeFutures and options trading involves risk of loss and is not suitable for everyone.📉 US Farmer Selling Increases Amid Economic Pressures 🚜According to Reuters, US farmers have increased their selling of corn and soybeans this week, following the USDA's report that reduced the 2024 corn and soybean production estimates. Despite the recent rally in grain markets, farmers continue to face low profits and rising input costs. Farm income has fallen by nearly 23% since 2022, raising concerns about the year ahead.🌱 Soybean Futures Fall Despite Tighter US Supply 🛑Soybean futures dropped sharply on Thursday, with the Mar25 contract losing 25 cents per bushel 🌾. While the US supply and demand situation has tightened, global soybean supply remains burdensome, and recent improvements in the weather forecast for southern Brazil and Argentina may have triggered the selling. The global market's supply concerns persist, but farmers and traders alike will be watching the weather patterns closely as these two key regions experience different growing conditions 📉.🌍 Brazil's Soybean Crop Forecast Slightly Raised 📈Agroconsult has slightly raised its forecast for Brazil's soybean crop to 172.4mmt, a small increase from its previous estimate of 172.2mmt 🌱. This increase is attributed to ideal weather and favorable planting conditions in most areas of Brazil. However, excessive rainfall in central Brazil and dry conditions in southern Brazil could affect harvest and yields. Despite these concerns, Brazil’s overall soybean production is set to remain strong, with record acreage expected 🌾.💼 Trump’s Treasury Nominee Defends Tariff Plans 💰During his confirmation hearing, Scott Bessent, President-elect Donald Trump's nominee for Treasury Secretary, defended the tariff proposals, suggesting they would be implemented gradually over the coming months 📊. Bessent emphasized that tariffs would help address unfair trade practices and geopolitical issues, despite concerns from some senators about their potential impact on inflation.US export sales showed improvements in corn and wheat but remained weak for soybeans. 🌾Corn sales reached 1mmt (40 million bushels), surpassing expectations, with Japan as the largest buyer 🇯🇵.Soybean sales were 569,100mt (21 million bushels), slightly up from the previous week but down 27% from the 4-week average . China was the largest buyer 🇨🇳.Wheat sales reached 513,400mt (19 million bushels), exceeding expectations, with South Korea as the largest buyer 🇰🇷.🌧️ USDA Drought Monitor Shows Limited Improvement 🚨The USDA released its weekly drought monitor, showing minimal precipitation across the Corn Belt and High Plains. However, drought conditions improved slightly in eastern Ohio, northern Indiana, and northeast Missouri, while worsening in southwest Nebraska 🌾🌧️. Here’s a breakdown of the areas still affected:Corn: 42% affected 🌽Soybeans: 34% affected 🌱Winter Wheat: 22% affected 🌾Spring Wheat: 33% affected 🌾Cattle: 32% affected 🐄📦 Flash Sales of Soybeans and Corn 📊In another round of flash sales, US exporters sold:132,000mt of soybeans (5 million bushels) to China 🇨🇳 for the 2024/2025 marketing year.135,000mt of corn (5 million bushels) to Taiwan 🇹🇼 for the 2024/2025 marketing year.
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23:34
Canada Threatens Tariffs + 45Z News and Soybean Selloff
Joe's Premium Subscription: www.standardgrain.comGrain Markets and Other Stuff Links-Apple PodcastsSpotifyTikTokYouTubeFutures and options trading involves risk of loss and is not suitable for everyone.0:00 Subscribe!1:00 Canada Tariff Threat3:45 45Z / CSA5:42 NOPA Crush8:13 Argentina Rainfall9:58 Ethanol Production10:59 Consumer InflationCanada's Potential Tariffs on US ProductsCanada is preparing to impose tariffs on $105 billion worth of US products if President-elect Donald Trump moves forward with his planned tariffs on Canadian goods. The list of products targeted by Canadian tariffs hasn’t been disclosed yet, but they could affect almost a third of US exports to Canada. USDA Issues New Rule for Climate-Smart BiofuelsThe USDA has announced an interim rule regarding climate-smart practices for biofuel feedstocks. This includes corn, soy, and sorghum and provides farmers with more flexibility to adopt practices like no-till, cover crops, and nutrient management to reduce greenhouse gas emissions. This rule will tie into the 45Z tax credit guidance, potentially unlocking new market opportunities for farmers producing biofuel feedstocks. US Soybean Crush Hits Record HighThe National Oilseed Processors Association (NOPA) released its December crush data, showing that US soybean crush hit an all-time high of 206.6 million bushels. This is a 6.9% increase from November and a 5.8% increase compared to last year. Soybean oil stocks climbed to 1.2 billion pounds, although they were slightly below trade estimates. This marks a strong 2024 for soybean production and oil availability.Argentina's Crop Outlook RevisedThe Rosario Grains Exchange has lowered its corn and soybean crop estimates for Argentina. Argentina's corn crop is now projected at 48mmt, down from previous estimates of 50-51mmt due to dry conditions. Similarly, soybean output is expected to fall, as droughts have reduced yields. The revised forecasts suggest that rainfall in both Argentina and southern Brazil could provide some relief in the coming weeks.US Ethanol Production Remains StrongUS ethanol production fell slightly by 1% last week to 1.1 million barrels per day but remains up 3.1% compared to last year. Ethanol stocks rose to 25 million barrels, marking a 3.6% week-over-week increase. Implied gasoline demand showed a slight dip, down 1.8% from the previous week, but remained steady year-over-year. Keep an eye on ethanol production as it continues to play a key role in biofuel output and agriculture!Inflation Indicator Declines for First Time Since JulyCore CPI (excluding food and gas) rose by 0.2% in December, showing the first decline since July. The annual increase is now 3.2%, down slightly from 3.3% in November. Headline CPI rose to 2.9%, staying in line with expectations. Experts are concerned that Trump’s economic policies could cause inflation to resurge.
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13:25