Warm Wet Weather Across the Corn Belt
Jun 25, 2018
EPA To Increase Mandate For Advanced Biofuel and Biodiesel Production For 2019, Ethanol Mandate Expected To Be Unchanged
EPA chief Scott Pruitt is expected to announce an increase to the government mandate for biofuel production to 19.88 billion gallons total, up 3% year on year. Advanced biofuels, such as cellulosic ethanol made from switchgrass or wood scrap, have had their allotted production increased by 590 mil gallons to 4.88 bil gallons. Biodiesel will also see an increase of 330 mil gallons to 2.43 bil gallons. Soybean oil is a major component for biodiesel manufacturing. Conventional biofuels, like corn-based ethanol, will likely see no change in its mandated production allotment in 2019, remaining at 15 bil gallons. Pruitt will also likely not reallocate biofuels to be blended that were waived via hardship waivers earlier this year after facing harsh criticism from the oil industry.
Export Sales Announcements-
Private exporters reported to the U.S. Department of Agriculture export sales of 186,000 metric tons of soybeans for delivery to unknown destinations during the 2017/2018 marketing year.
Managed Money Turns Net Short In Soy, Adds To Corn Shorts
Amid the trade war between the US and China, MM is now 27,073 contracts net short, the largest short position since Jan 23. Just last week, MM was net long by only 105 contracts. MM was also selling corn, bringing their net short position to 57,451 contracts. For SRW, MM turned bearish, moving from a net long position last week to 4,861 contracts net short this week. MM actually increased their longs for HRW to 60,606 contracts.
Improved Weather In Australia Sees Wheat Sell Off, Conditions Remain Good In The US
Areas in western and southern Australia have seen several inches of rain over the past few days and are expecting up to 2 more over the next week according to NOAA. US HRW harvest is also 27% complete, compared to the 5 year average of 19%. Warm and wet weather across the Corn Belt has been a boost to crops. Nebraska, Minnesota, and the I States all have received above average rainfall at this point in the growing season. Flood warnings and watches remain in effect in parts of E NE and W IA as thunderstorms are expected and some rivers and streams are already overrunning their banks.
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