Weekly Commodity Market Update: Court overturns EPA's denial of more than 100 small refinery exemptions from 2022
This week Will and Ben breakdown a court's overturning of more than 100 of the EPA's small refinery exemption denials.
Market recap (Changes on week as of Monday's close):
- December 2023 corn down $0.12 at $4.55
- December 2024 corn down $0.06 $5.04
- January 2024 soybeans down $.33 at $13.30
- November 2024 soybeans down $.21 at $12.80
- December soybean oil down 1.63 cents at 51.06 cents/lb
- December soybean meal down $22.10 at $436.60/short ton
- December 2023 wheat down $.09 at $5.34
- July 2024 wheat down $.10 at $5.89
- January WTI Crude Oil down $3.36 at $75.00/barrel
Weekly Highlights
· On Black Friday- the Fifth Circuit Court overturned the US Environmental Protection Agency denial of 31 small refinery exemptions from April 2022 and then another 69 exemptions in June of 2022, causing a major setback for the US ethanol industry.
· US ethanol production decreased 7 million gallons week over week to 301 million gallons. Corn used for ethanol is estimated to be 101.3 million bushels. Corn used for ethanol so far this marketing year is up 16 million bushels or 1.5% compared to the same period last year but the surplus fell on the week.
· Ag Export sales were all within expectations but below levels typically experienced at this time of the year.
· Open interest of Chicago futures and options positions fell for corn (-1.5%), soybean oil (-2.2%), and cotton (-6.4%) while increasing for soybeans (+1.5%) and soybean meal (+3.9%).
· Managed money traders decreased their net positions of Chicago futures and options for corn by 22,016 contracts to increase their net short and soybeans by 6,326 contracts to decrease their net long. Traders also had a net increase of 23,330 contracts to turn their net small net short of Chicago wheats into a small net long.
· It was a disappointing week for US ag export inspections excluding milo. Corn came in below all pre-report expectations and was bearish to the market. Soybean and wheat export volumes were significantly below their typical volumes for this point in the year. Milo inspections were the largest since May 2022.
· US winter wheat conditions improved just slightly on the week up to 338 from 333 last week (a perfect score is 500). There is low correlation between fall conditions and spring yields, but the entire crop is better this year than last year at this time and above the 3-year average. Kansas, the largest producer of winter wheats, has conditions score of 288 compared to 260 last year and a 3 year average of 318.
Topics:
- Market recap
- Grains, oilseeds down across board
- EPA small refinery exemptions overturned
- Reports to watch
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