- Today’s Chicago rally stalled as selling returned to the market amid news that US fuel producers are “unhappy” with last week’s Congressional Bill, which aims to shift the biodiesel credit from blender to producer. Major US oil companies are arguing that if their biodiesel blending incentive is removed there is no reason to use more biodiesel and that biodiesel stocks will likely grow dramatically based upon overproduction, in turn depressing prices. There are threats of lawsuits and claims of lack of WTO compliance, clearly passion is running high.
- In Argentina we are hearing that newly elected Marci is claiming he wants the Peso float freely and end the two tier system. A free float and an end to export taxes (or at least any reduction) could well see farmers incentivised to release stocks of grain and soybeans that have built up as an inflation buffer. The market is watching developments closely and it seems that there are more aggressive corn offers from Argentina from March onwards.
- In addition to potentially growing Argentine corn availability we could well be seeing Brazil’s exports expanding significantly. There are suggestions that a record 33 million mt could well be exported by Brazil, which if proven correct would likely hinder US sales that are already struggling on a competitive basis.