Tuesday was a mostly positive day for our markets. Spot corn closed down 1 3/4, spot soybeans closed up 5 1/2, spot winter wheat closed up 3/4 and spot spring wheat closed up 2. In the overnight all of our markets are on the positive side. Oil closed up $1.76 yesterday at $62.39 per barrel. It is stronger again this morning with it now valued at $62.54 per barrel. Our dollar started out yesterday morning at $0.729 US and then trended higher going up to $0.738 US in the overnight trading. It has eased back some this morning with it currently valued at $0.737 US. We have not seen our dollar this strong since early June of last year.
Soybeans were higher yesterday and were supported by the vegetable oil market. Demand for palm oil helped to rally this market. Higher crude oil prices also supported the market with more potential profit in the biodiesel market. Support this morning is coming from the current US administration which we will deal with below.
President Trump visited Iowa yesterday and promised in a speech to support year round E15 blend for ethanol. In a perfect scenario this would increase corn usage by up to 2 billion bushels in the US. We need to understand however that currently there is not enough production capacity in the US to move instantly to this level. Details are missing (of course) of the new plan but it will also include increased usage of biodiesel would should result in increased soybean oil usage. One interesting note about this announcement was that earlier this week the current administration did not support E15 being put into any of the short term funding bills required to keep the US government from another shutdown at the end of this month. Looks like President Trump wanted to make the announcement at a political rally in front of his supporters.
We keep talking about how Brazil is dominating the world soybean market and more specifically imports by China. In 2021 exports by Brazil totalled 60% of the imports by China. This has steadily increased up to 74% for last year. At the same time the US portion of the Chinese imports decreased from 33% in 2021 down to 15% for last year. With the recent completion of the 12 million tonnes of purchases of US soybeans by Chinese buyers they have switched their current buying to less expensive soybeans from Brazil.
Delores Seiter | 613-880-7458
Bob Orr | 613-720-1271
Tony Mitchell | 613-227-2525
Office | 613-489-0956
