TOP HEADLINES
US Lawmakers Renew Push to Halt Flow of Fake Used Cooked Oil
- Letter from senators asks EPA to step up verification
- Used cooking oil is an essential feedstock for renewable fuels
US lawmakers are ratcheting up pressure on the Environmental Protection Agency to stem the flow of suspected fake foreign used cooking oil that could be undermining American soybean farmers.
“We have significant concerns about the existing verification process,” six senators, including Iowa Republican Joni Ernst and Minnesota Democrat Amy Klobuchar, wrote in a letter to EPA Administrator Michael Regan seen by Bloomberg.
Historic levels of the oil, or UCO, have been flooding into the US and cutting into demand for US-grown ingredients, such as soybean oil, that are essential for making renewable fuels. There is widespread suspicion some of the imported products are being blended with virgin vegetable oils like palm, which is linked to deforestation in Southeast Asia.
The push by the lawmakers comes as the biofuel industry awaits US government guidance on a new “clean” fuel tax credit set to take effect next month. A bipartisan group of senators earlier this year urged Treasury Secretary Janet Yellen to ensure that only biofuels made with domestic ingredients can benefit from the incentive. Donald Trump’s victory in November is adding to the uncertainty as the president-elect vows to clamp down on China with new tariffs.
In their letter, the lawmakers urged the EPA to respond to a request sent in June asking how the agency intends to verify the authenticity of UCO, saying the current system isn’t working.
The US has imported a record 3.2 billion pounds of UCO from January to August, the lawmakers wrote, citing US Census Bureau data. “This is enough product to displace approximately 270 million bushels of soybeans,” according to the senators.
Lawmakers asked the EPA to outline how it traces the origin of UCO imports, especially those coming from countries with “limited oversight” such as China, and if the agency plans to make any changes in how UCO shipments are verified.
FUTURES & WEATHER
Wheat prices overnight are up 3 1/2 in SRW, up 5 1/4 in HRW, up 4 1/2 in HRS; Corn is up 1 3/4; Soybeans up 1 1/2; Soymeal up $3.20; Soyoil down 0.90.
Markets finished last week with wheat prices down 5 in SRW, up 3/4 in HRW, down 2 1/2 in HRS; Corn is up 1 1/4; Soybeans up 3; Soymeal down $0.10; Soyoil down 0.70.
For the month to date wheat prices are up 7 3/4 in SRW, up 21 1/2 in HRW, up 11 1/4 in HRS; Corn is up 10 3/4; Soybeans up 1/2; Soymeal down $1.30; Soyoil up 0.02.
Year-To-Date nearby futures are down 11.8% in SRW, down 12.9% in HRW, down 17.0% in HRS; Corn is down 6.0%; Soybeans down 23.3%; Soymeal down 25.1%; Soyoil down 12.3%.
Chinese Ag futures (JAN 25) Soybeans down 36 yuan; Soymeal up 2; Soyoil down 22; Palm oil up 46; Corn down 11 — Malaysian Palm is down 83.
Malaysian palm oil prices overnight were down 83 ringgit (-1.69%) at 4823.
There were changes in registrations (-32 Corn, 18 Soyoil, 74 Soymeal). Registration total: 20 SRW Wheat contracts; 72 Oats; 143 Corn; 312 Soybeans; 879 Soyoil; 1,665 Soymeal; 105 HRW Wheat.
Preliminary changes in futures Open Interest as of December 13 were: SRW Wheat up 3,448 contracts, HRW Wheat down 2,429, Corn down 7,964, Soybeans up 9,079, Soymeal up 6,812, Soyoil up 2,185.
Brazil: Overall good weather conditions continue with scattered wet season showers in central Brazil and fronts continuing to come up from Argentina with scattered showers for southern states. This general pattern is forecast to continue through the end of the year at least, favoring flowering to filling soybeans and developing corn.
Argentina: It was dry over the weekend and that continues in most areas this week. However, there will be a front that moves through Wednesday and Thursday with some isolated showers, along with another one or two this weekend and early next week. Though precipitation is favored across the north, getting some rain in the south would be helpful. This area is more touchy with soil moisture that is fair, but falling. Larger dry spots may occur if the showers that move through disappoint.
Northern Plains: Warmer air flooded the region over the weekend, but colder air is building up in the Canadian Prairies and will graze the northern edge of the region early this week with some colder temperatures. More widespread cold should follow behind a clipper that moves through Wednesday night and Thursday. The clipper could bring through some needed precipitation to northern areas as well. Any cold should not last long as warmer air spreads back in again this weekend.
Central/Southern Plains: A system brought limited showers to the eastern Plains this weekend, but most areas stayed dry. A leftover front will produce showers for southeastern areas through Wednesday, but wheat areas in the west will be drier, a continued pattern since a wet November. The pattern may be a little more favorable for precipitation next week.
Midwest: A system brought mixed showers along with warm air this weekend. Another system moving through will take temperatures down a few degrees Monday and Tuesday, as well as bring through some scattered showers. A front near the Ohio River could produce more rain on Wednesday. A clipper moving through Thursday and Friday will bring through a band of heavier snow likely to the north, while also bringing through some briefly colder air. The pattern stays active next week and some drought reduction is possible.
Lower Mississippi: Recent showers in the Mississippi and Ohio Valleys gave a bump to water levels on the river and the pattern is favoring more heavy rain in the basin this week with several systems and fronts, especially in the Ohio Valley. That should help to give a longer bump in water levels along the river, removing restrictions for transport.
Europe: Light showers moved through over the weekend, but were a little more intense in parts of southern Italy and southeastern Europe, where they were welcome. Several waves of systems, fronts, and showers are forecast to move through the continent through the end of the year, keeping up overly wet soils in the northwest, but maintaining or improving soil moisture for most other areas. Spain is forecast to be on the lighter end, though, and could use more rain.
Black Sea: Wheat went dormant in good condition in the west, but poor condition in the east, particularly in southwestern Russia. The region will hope for good precipitation over the winter for when the wheat breaks dormancy in the spring. Scattered showers fell over the weekend and several systems are forecast to move through this week and next that could be beneficial.
Australia: It was largely dry over the weekend. A front moving through the southeast will bring some isolated showers on Monday, but most areas will stay dry this week and the forecast is fairly dry next week as well. That helps with the remaining wheat and canola harvest, but will dry out soils for cotton and sorghum after recent rains had improved conditions there.
The player sheet for Dec. 13 had funds: net sellers of 3,000 contracts of SRW wheat, sellers of 3,000 corn, sellers of 4,000 soybeans, sellers of 2,000 soymeal, and sellers of 2,000 soyoil.
TENDERS
- SOYBEAN SALES: The U.S. Department of Agriculture confirmed private sales of 200,000 metric tons of U.S. soybeans for delivery to unknown destinations during the 2024/25 marketing year, the second such soybean sales announcement in as many days.
- NON-GMO SOYBEAN PURCHASE: South Korea’s state-backed Agro-Fisheries & Food Trade Corp bought about 50,000 metric tons of soybeans free of genetically-modified organisms (GMOs) in an international tender which closed on Friday.
- WHEAT PURCHASE: Saudi Arabia’s main state wheat buying agency the General Food Security Authority (GFSA) on Monday purchased an estimated 804,000 metric tons of hard wheat in an international tender
PENDING TENDERS
- FEED WHEAT TENDER: Importers in the Philippines tendered to purchase around 60,000 metric tons of animal feed wheat
- WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat that can be sourced from optional origins
- FEED WHEAT AND BARLEY TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) said it will seek 65,000 metric tons of feed wheat and 25,000 tons of feed barley to be loaded by Feb. 7 and arrive in Japan by March 6, via a simultaneous buy and sell (SBS) auction that will be held on Dec. 18.
- FEED BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase up to 120,000 metric tons of animal feed barley.
TODAY
China’s agriculture ministry to speed up research on high-oil soybeans, high-protein corns
China’s agriculture ministry said on Friday it will “vigorously” accelerate joint research into high-oil and high-yield soybeans, and high-protein corns.
In a meeting, the ministry also said that it will take increasing large-scale per-unit yields as a key measure to develop high-standard farmland, and make efforts to ensure stable production and supply of grain and key agricultural products.
SOYBEAN/CEPEA: Possible higher demand for oil sustains prices
Cepea, 13 – The firm demand for soybean oil in Brazil and in the United States, especially to produce biodiesel, has sustained values of the byproduct this week. Moreover, estimates indicating an increase of the global demand for oil also influenced quotations.
According to data from the USDA released on December 10, global trades involving soybean oil may hit the record of 12.64 million tons, 4.6% up compared to the volume projected in November and 7.5% above that verified last season.
In the domestic market, the value of soy oil increased 0.3% from Dec. 5-12, closing at 7,196.34 BRL per ton (in São Paulo city with 12% ICMS) on Dec. 12.
Soybean prices, in turn, are moving down. World trades are estimated to hit the record of 73.37 million tons (USDA), but the increasing demand for soy oil may boost the remaining volume of soybean meal.
The USDA says that Argentina continues to lead soybean meal exports, with 28 million tons, 2.6% more than the estimated in the past report and 12.5% more compared to the volume shipped last season. Brazil is likely to supply the international market with 20.5 million tons, 9.78% less than in the 2023/24 crop.
On the average of the regions surveyed by Cepea in Brazil, soymeal prices dropped 0.7% between December 5 and 12.
SOYBEANS – Quotations continue to decrease in Brazil because of the lower demand, favorable weather conditions for crops and expectations of a record production.
The global soy production is estimated by the USDA at 427.14 million tons in the 2024/25 season, 0.4% more than the projection released in November and 8.2% above the volume of the past crop.
Brazil may harvest the record of 169 million tons (USDA), which is higher than that projected by Conab (166.2 million tons).
On the average of the regions by Cepea, soybean prices dropped 1% from Dec. 5-12 in the over-the-counter market (paid to farmers) and in the wholesale market (deals between processors).
The ESALQ/BM&FBovespa Index (Paranaguá) increased only 0.1% from December 5-12, closing at BRL 142.91 per 60-kg bag yesterday. The CEPEA/ESALQ Index (Paraná) dropped 1% in the same comparison, to close at BRL 139.40 per 60-kg bag on Dec. 12. The US dollar rose 0.5% against Real in the same comparison, closing at BRL 6.034.
CORN/CEPEA: Prices are firm; 24/25 season in Brazil may surpass the previous
Cepea, 13 – Corn prices continue firm in most regions surveyed by Cepea, sustained by the fact that many sellers are away from closing deals. Those who are trading ask for higher values due to the supply restriction in this period of the year.
Some consumers indicate to have difficulties to replenish inventories; therefore, they need to pay higher quotations to close deals. Other agents are away from trading, claiming to have enough volume, scenario that prevented more significant rises this week.
The ESALQ/BM&FBovespa Index (Campinas, SP) moved up 0.2% between December 5 and 12, closing at BRL 73.25 per 60-kilo bag on Dec. 12. On the average of the regions surveyed by Cepea, corn values rose 0.6% in the over-the-counter market (paid to farmers), but dropped 0.5% in the wholesale market (deals between processors) from December 5-12.
PROJECTIONS – Although the 2024/25 season has begun after the ideal period and with concerns related to the lack of rains, the return of the rainfall has led players to be optimistic about the production in Brazil.
Conab released a report on Dec. 12 indicating that the 2024/25 total production is estimated at 119.63 million tons, for an increase of 3.4% compared to 2023/24. The summer crop may total 22.61 million tons, 1.5% lower than in 2023/24. As for the second crop, Conab forecasts a production of 94.63 million tons, 4.8% up. The third crop, in turn, is likely to total 2.38 million tons, downing 3.8%.
Exports are projected at 34 million tons, while the domestic consumption may total 87.03 million tons in the 2024/25 season. As a result, ending stocks would be at 4.9 million tons by January/26 – data from Conab.
In global terms, data from the USDA indicate supply at 1.21 billion tons in 2024/25, against 1.22 billion tons in the crop before. The world consumption may be at 1.24 billion tons, more than the 1.21 billion tons verified in the past season. As a result, ending stocks are likely to reach 296.44 million tons, downing 6% compared to the previous.
PORTS – Brazilian exports totaled 1.17 million tons of corn in the first five days of December, with a daily pace at 234.17 thousand tons, 23% less than in December/23. Corn quotations rose 1.8% from Dec. 5-12 at the port of Paranaguá (PR) and 1.2% in Santos (SP). Dollar quotations increased 0.5% against Real in the same comparison, closing at BRL 6.034 on December 12.
CROPS – Up to Dec. 8, the 2024/25 summer crop planting had reached 72.2% of the area in Brazil, moving up 7.1 percentage points in one week – data from Conab.
Egypt Lawmakers OK $500M Wheat Financing Deal With UAE: MENA
Parliament approves $500m framework agreement between Egypt and the Abu Dhabi Exports Office that covers financing for wheat purchases, the state-run MENA news agency reports.
Funding is divided equally over a five-year period
Russian agricultural organizations’ grain reserves fall 21% to Dec 1 -Rosstat
Russian agricultural organizations’ reserves of grain and leguminous crops including corn totaled 31.1 million tonnes as of December 1, down 21.3% from a year earlier, when they stood at 39.4 million tonnes, the State Statistics Service (Rosstat) said.
Reserves of wheat fell 24.6% to 18.7 million tonnes from 24.8 million tonnes a year earlier. Corn for grain fell 4.3% to 3.8 million tonnes, from 4 million tonnes a year ago.
Agricultural organizations sold 7.1 million tonnes of grain in November, down 7.6% from a year earlier when the figure stood at 7.6 million tonnes. Sales grew 4.9% in 11M to 73.3 million tonnes from 69.9 million tonnes a year ago.
Sales of wheat in the preceding month fell 0.7% to 4.35 million tonnes, from 4.38 million tonnes a year ago. They grew 5.8% in 11M to 49.5 million tonnes, up from 46.8 million tonnes last year. Sales of corn fell 35% YoY in November, standing at 995,700 tonnes compared to 1.5 million tonnes, while they fell 4.7% in 11M, declining from 8 million tonnes to 7.6 million tonnes.
Russia’s grain harvest will total 130 million tonnes this year, the Agriculture Ministry said. This includes 83 million tonnes of wheat. The harvest totaled 144.9 million tonnes of grain in 2023, including 92.8 million tonnes of wheat.
US Pork Production Falls 0.9% This Week, Beef Down: USDA
US federally inspected pork production falls to 555m pounds for the week ending Dec. 14 from 560m in the previous week, according to USDA estimates published on the agency’s website.
- Hog slaughter down 1.1% from a week ago to 2.573m head
- Beef production down 0.8% from a week ago, cattle slaughter falls 0.8%
- For the year, beef production is 0.5% below last year’s level at this time, and pork is 1.1% above
Urea, UAN, Ammonium Sulfate Rise on Tight Supply, India Demand
New Orleans (NOLA) urea jumped to $317-$328 a short ton (st), up from $308-$315 last week, after news of another India tender. Urea also firmed in Brazil, Egypt, the Mediterranean and Middle East regions, though terminal prices in the US were flat. Tight supply pushed urea ammonium nitrate (UAN) up $5-$20/st in the Corn Belt, with limited prompt availability reported and most offers circulating for 1Q or 2Q shipment only. Midwest ammonium sulfate prices firmed in the wake of another $20/st increase from AdvanSix on Dec. 10. NOLA phosphate was mostly stable, but inland warehouse prices for phosphates and potash slipped during the week as fall demand ends.
Ammonia application continued in the Corn Belt during the week, with prompt pricing described as stable and spring prepay programs yet to be announced.
Viterra Withdraws Bid to Buy Cargill Ship, Grain Storage Sites
Viterra Ltd. said it will withdraw its proposal to acquire various grain storage sites and a ship loader owned by Cargill Inc., according to a statement.
- Viterra and Cargill notified the Australian Competition and Consumer Commission on Friday that Viterra intended to withdraw its application to acquire Cargill’s GrainFlow storage sites and a ship loader in South Australia, and the Dimboola grain storage and handling site in Victoria
- Viterra said it remains focused on increasing competition for SA and western Victorian growers by attracting buyers to purchase more local grain
- Cargill did not immediately respond to request for comment
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