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Welcome back!
Grain futures finished higher Wednesday as a weaker US dollar, biofuel headlines, and weather concerns provided support across ag and macro markets. Here’s what moved markets today 👇

🌽 Grain Markets
Corn and soybeans ended the session modestly higher, supported by a sharply weaker US dollar, which improves US export competitiveness.
President Trump said Congress is close to approving year-round E15, and that new biofuel guidelines are nearing completion—adding support to corn demand expectations.
Wheat also closed higher as traders continue to assess potential crop impacts from the recent winter storm.
In my view, developing dryness and a hot/dry forecast in Argentina likely played a role in row crop strength as well. See the map from our friends at CropProphet below.

🌾 Ethanol Update
US ethanol production declined modestly last week, though output remains higher than the same week last year.
Ethanol stocks also fell week over week and year over year.
According to Reuters data, ethanol margins weakened across the Corn Belt and are currently negative to breakeven, reflecting softer profitability.
Margins improved slightly following Monday’s corn selloff.

🐄 Livestock & Animal Health
The NCBA warned that it is likely only a matter of time before New World screwworm reaches the US.
NCBA President Buck Wehrbein said the pest is more likely to enter via wildlife than cattle imports and emphasized that the US successfully eradicated screwworm in the 1960s.
Recent rumors of screwworm already reaching the US triggered sharp selling in live and feeder cattle futures last week.

🥇 Precious Metals & Margins
CME Group raised margin requirements on precious metal futures following the historic rally in gold and silver.
Higher margins mean traders will need more capital to hold positions, potentially limiting participation by smaller traders.
Silver and gold both hit record highs before settling lower on the day.
For perspective: silver at ~$117/oz is roughly equivalent to trading $117 corn or soybeans, with a contract value near $585,000.

🏦 Federal Reserve
The Fed held interest rates steady, with two governors dissenting in favor of a cut.
Inflation remains above target, while labor markets show signs of stabilization.
Jerome Powell’s term ends in May, after which President Trump will appoint a new Fed chair.
Futures markets are pricing in limited rate cuts this year and none in 2027.

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Staying informed matters—especially in markets like these.

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Welcome back to the channel!
In today’s update, we cover Trump’s comments on year-round E15, growing weakness in the U.S. dollar, 2026 acreage debates, heat stress in Argentina, fresh USDA flash sales, and China’s latest soybean buying behavior.

⛽🇺🇸 E15, Trump & The Fed
President Trump visited Iowa and said Congress is very close to approving year-round E15 sales
Comments come after the White House failed to include E15 language in the current funding bill.
Trump declared the U.S. is entering a “golden age.”
He said a new Fed Chair announcement is coming soon and predicted significantly lower interest rates.

💵📉 U.S. Dollar Breakdown
The dollar hit its weakest level in nearly four years.
Pressure is coming from policy uncertainty, fiscal risks, and political polarization.
Euro, yen, and Swiss franc are at multi-year highs.
Emerging-market currencies are trading at record levels.
Investors are paying record premiums to hedge against further dollar weakness.

🌽🌱 2026 Acreage Debate
S&P Global estimates corn acreage at 95 million and soybeans at 84.5 million.
Higher corn input costs and crop rotation favor soybean.
China’s renewed soybean purchases add support to bean acres.
NCGA projects an $180/acre loss for corn.
Pro Farmer notes fertilizer already applied and historical trends could keep corn acres elevated.
Crop insurance guarantees in February will be key.

🔥🇦🇷 Argentina Weather Stress
Temps nearing 104°F across major growing regions.
Limited rain until February raises yield risks.
USDA estimates: 53 mmt corn, 48.5 mmt soybeans.
Planting nearly complete, but pasture conditions are deteriorating.
Meal markets remain quiet; bean oil strong amid biofuel sentiment.

🚢📊 USDA Flash Sales
110,000 mt of corn sold to unknown destinations (2025/26)
306,000 mt of sorghum sold to unknown destinations (2025/26)
First U.S. sorghum flash sale since August 2024.

🇨🇳🌎 China Soybean Buying
China booked at least 25 cargoes of Brazilian soybeans for Mar–Apr shipment.
Brazil holds a strong price advantage over U.S. beans.
China has now fulfilled its ~12 mmt U.S. purchase commitment.
Recent U.S. buying appears obligation-driven, not structural.
With large South American crops expected, China likely avoids U.S. beans until new crop this fall.

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🧪 Fertilizer Market & USDA Action
The USDA is taking a closer look at potential collusion in the fertilizer industry. Last week, Deputy Agriculture Secretary Stephen Vaden accused fertilizer giants Nutrien and Mosaic of working to limit supply and keep prices elevated. The two companies accounted for more than 90% of North American phosphate fertilizer and potash production last year.
A proposed new potash mine in Saskatchewan could weaken their market control and add supply to the U.S. market as early as next year. USDA officials say they are closely monitoring fertilizer markets and could take action to boost competition if needed.
Vaden also took aim at farm equipment manufacturers, backing the administration’s push for right-to-repair protections for farmers.

🌽 Biofuels Policy & 45Z Tax Credit
Clean Fuels Alliance America is urging the Trump administration to release the proposed 45Z tax credit rules. The request comes after the White House completed its review of the rule.
According to the biofuels group, clearer guidance is needed to reduce uncertainty and support biodiesel, renewable diesel, and sustainable aviation fuel production. They warned that continued delays could jeopardize investments, production, and rural jobs, while final rules could boost commodity demand and rural economic activity.
President Trump is scheduled to speak today in Clive, Iowa, where energy and economic issues are expected to be front and center. While there’s some chatter about a possible biofuel announcement, nothing is confirmed.

🌾 Wheat, Corn & Soybean Markets
Wheat futures moved lower on Monday. The CBOT March contract fell to around $5.23 after earlier touching the highest level since mid-December.
Cold weather in the High Plains raised concerns over crop damage, but snowfall helped insulate much of the wheat belt. Some damage was reported in parts of Nebraska, northeastern Colorado, and northwestern Kansas.

🚢 Export Inspections
U.S. corn shipments were strong last week. USDA reported 1.5 million metric tons of corn inspected for export, higher than both the previous week and last year.
Soybean inspections totaled 1.3 million metric tons, slightly lower week-to-week but sharply higher year-over-year, with China accounting for the majority of shipments.
Wheat inspections were weaker, trailing both last week and last year.

🇧🇷 Brazil Crop Update
AgRural raised its forecast for Brazil’s soybean crop again, now calling for a record harvest. Corn production estimates were also nudged higher.
Soybean harvest and second-crop corn planting are both running ahead of last year’s pace, while first-crop corn harvest is slightly behind. Rainfall has been mostly average, though southern areas remain somewhat dry.
Based on current estimates, Brazil’s soybean crop would be substantially larger than the U.S. crop.

🔥 Natural Gas & Winter Storm Impact
Natural gas prices surged to their highest level in years as Winter Storm Fern swept across the U.S., driving up heating demand.
The storm knocked out power to hundreds of thousands of customers and disrupted roughly 10% of U.S. natural gas production. In response, the Department of Energy issued emergency orders aimed at stabilizing power grids and reducing blackout risks in New England and Texas.

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🏛️ Government Shutdown Risk
The risk of a partial government shutdown is rising as the Senate prepares to vote later this week on a House-passed $1.2 trillion funding package. Following another fatal shooting involving federal immigration agents in Minnesota, Democratic lawmakers are threatening to oppose the bill due to DHS and ICE funding concerns. Democrats argue the package lacks reforms to rein in ICE.

While funding for many other agencies is included, there may still be enough Democratic support to avoid a shutdown. The last shutdown lasted 43 days and delayed key USDA and CFTC reports. Polymarket odds of a shutdown jumped sharply over the weekend. There is growing concern that previously approved FBA payments, currently slated for late February, could be delayed if a shutdown occurs.

❄️ Winter Storm & Cold Impacts
This weekend’s winter storm delivered widespread snow and extreme cold across the Plains. Parts of HRW wheat country in the Southern Plains received beneficial snowfall, reducing winterkill risk. However, below-zero temperatures combined with snow created severe cold stress for livestock, limiting weight gains and increasing risks for producers in calving season.

Wind chills in the Northern Plains plunged to extreme levels, while portions of Texas and Oklahoma face record lows with freezing temperatures expected to persist. Single-digit temperatures may linger another day or two in HRW wheat areas, while SRW wheat country in the Midwest remains locked in frigid conditions this week.

🌽 Grain Markets
Corn futures advanced on Friday, led by strong export demand. The most active March contract settled higher, supported by near-record export sales and competitive U.S. prices on the global market. Growing concern over dry conditions in parts of South America has added uncertainty around crop potential. Soybean and wheat futures also posted gains.

⛽ E15 Left Out (Again)
Farm groups and ethanol advocates are pushing back after Congress once again omitted year-round E15 sales from the funding package. Instead, lawmakers plan to form an E15 Rural Domestic Energy Council to study the issue.

🚢 Export Sales
U.S. export sales were impressive last week:
Corn sales set a marketing-year high, far exceeding expectations, with unknown destinations as the top buyer.
Soybean sales also hit a marketing-year high, with China leading purchases.
Wheat sales surpassed expectations, with unknown destinations again the largest buyer.
Overall, export demand remains a major source of support for the grain markets.

📊 CFTC Fund Positioning

In the latest Commitment of Traders report, large money managers were net sellers across corn, soybeans, and SRW wheat. The net short position in corn is now the largest since late October, reflecting continued bearish positioning despite recent market strength.

🐄 Cattle on Feed

Friday’s Cattle on Feed report came in largely neutral. Cattle on feed were below last year but slightly above expectations. Placements and marketings were both near or above pre-report estimates.
Notably, heifers made up a large share of cattle on feed, signaling that many are still being fed rather than retained for herd rebuilding—an important long-term signal for the cattle market.

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Farm Aid & Policy Update

Additional farm aid was not included in the current government funding package, catching many lawmakers and farm groups off guard. Senate Republicans had pushed just last week to add up to $15B in aid, but that language was left out.
With aid excluded for now, supporters say relief may need to come via supplemental appropriations or future legislation.
Congress must pass the funding package by January 30 to avoid another government shutdown.
It was also reported yesterday that nationwide E15 language was again dropped, though GOP leaders are discussing a possible supplemental bill that could allow year-round E15 sales.

Major Winter Storm Risk

A major winter storm is forecast to impact the Southern US this weekend. While the exact track remains uncertain, over 70 million people from Dallas to Little Rock to Nashville are currently under a winter storm watch.
Snow, ice, dangerous travel conditions, and power outages are possible.
Snow cover remains limited across key HRW wheat areas in the Southern Plains. Temperatures in western Kansas and surrounding regions could fall into the single digits, raising the risk of winter kill depending on snow totals and duration. Livestock stress is also a concern.

US–China Trade Watch

US and Chinese officials may soon hold another round of trade talks ahead of the planned April meeting between Donald Trump and Xi Jinping.
According to the US Trade Representative, negotiations would focus on common goods and services, avoiding sensitive areas like tech and national security.
China has already fulfilled its commitment to purchase 12 mmt of US soybeans. Treasury Secretary Scott Bessent said both sides are now looking ahead to China’s pledge to buy 25 mmt annually through 2028, though Trump continues to push for larger volumes.

Europe, Greenland & Tariffs

President Trump announced he will refrain from imposing new tariffs on European countries, following meetings at the World Economic Forum.
He stated that a framework for a future deal involving Greenland has been reached, marking a major shift from prior tariff threats. While details remain limited, Denmark continues to oppose any US takeover.

Grain Market Recap

Soybean futures rebounded Wednesday, with the most-active Mar26 contract gaining roughly 12 cents, settling near $10.65.
Support came from a slow start to Brazil’s soybean harvest due to rainfall in northern regions, along with comments from Treasury Secretary Bessent pointing to ongoing Chinese demand for US soybeans.

Global Protein Trade

China has reopened its market to Canadian beef imports, ending a ban that had been in place since 2021. Initial shipments are expected to be small, but the move is a positive long-term opportunity for Canada’s cattle industry.
Meanwhile, US beef exports to China have declined sharply over the past year amid ongoing trade tensions.

India & Wheat Exports

India has approved the export of 500,000 tons of wheat flour and related products. Wheat exports had been restricted since May 2022, but a strong monsoon is expected to boost domestic supplies.
India is typically self-sufficient in wheat and is sometimes a net exporter. Its re-entry into the export market is considered a bearish factor for global wheat prices.

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🇨🇳 China & U.S. Soybeans
China has reportedly completed its ~12 mmt U.S. soybean purchase, according to Treasury Secretary Scott Bessent
Shipments are expected to move by May
Focus now shifts to China’s 25 mmt annual soybean pledge over the next three years
Despite that pledge, South American soybeans remain more competitive, likely capping U.S. demand
Ongoing economic strain and a smaller hog herd could further weigh on Chinese soybean usage

📌 Important context:
USDA has only confirmed 8.1 mmt of soybean sales to China so far
Roughly half of recent “Unknown” sales likely end up in China, plus some unreported intra-house business
Even at 12 mmt, purchases are well below the ~22.5 mmt China bought last marketing year
That’s why USDA cut its U.S. soybean export forecast last week

📉 Grain Markets
Soybeans: Mar ’26 contract slipped ~5¢, settling near $10.53
Pressure came from:
Rising geopolitical tensions over Greenland
Expectations for a record Brazilian soybean crop
Corn: Mar ’26 futures eased ~1¢ to $4.24

🚜 Farm Economy Reality Check
Farmers face tight margins after years of weak prices and rising costs
New York farmer Ron Robbins used detailed field-level data to:
Fallow unprofitable acres
Improve marginal land
Shift some acres from soybeans to corn
His takeaway: the downturn may be the new normal—reassessment is no longer optional

🚢 Weekly Export Shipments (USDA)
Corn: Strong print, beating expectations
Soybeans: Near top end of estimates; China took 46% of the week’s volume
Wheat: Also near the high end of expectations
YTD snapshot:
Soybean shipments: well below last year
Corn shipments: well ahead of last year
China-bound soybean cargoes shipped via both PNW and Gulf

🌱 Flash Sale
USDA confirmed a soybean meal sale to the Philippines for next marketing year

🌍 Macro & Markets
Japan’s bond market saw sharp turmoil after fiscal concerns and a weak auction
Long-dated yields spiked, spilling into global credit markets
S&P 500 logged its largest one-day drop since October
A weaker dollar failed to spark meaningful buying in ag

₿ Bitcoin Watch
Strategy Inc. (formerly MicroStrategy) has gone all-in again:
Massive recent Bitcoin purchases
Now the largest corporate holder of Bitcoin globally
Strategy uses Bitcoin as its primary treasury reserve, funded largely through debt issuance
CEO Michael Saylor remains controversial due to the aggressive approach

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🚜 Farm Aid & Government Funding

Senate Republicans are pushing for an additional farm aid package, potentially totaling up to $15 billion (not yet confirmed).

The proposal includes:
Additional bridge payments
Support for specialty crop producers
Higher farm ownership and operating loan limits
Aid for farmers who suffered losses above the national average or were forced to sell at depressed prices
Lawmakers plan to attach the measure to upcoming government funding legislation
Farmer Bridge Assistance (FBA) payments remain scheduled for February 28

A possible government shutdown on January 30 could:
Delay FBA payments
Delay any new farm aid package
The House and Senate have passed several spending bills, but key issues remain unresolved

🌍 Global Trade & Geopolitics
President Trump announced new tariffs on NATO allies over Greenland
10% tariffs begin February 1
Increase to 25% on June 1
Tariffs remain until the US is able to purchase Greenland
The EU is weighing retaliatory trade measures
Trump also said he would consider using force if negotiations fail

Market reaction:
S&P 500 futures down 1.8%
European and UK equities sharply lower
US dollar weaker against major currencies

🇨🇦🇨🇳 Canada–China Trade Deal
China will reduce tariffs on Canadian canola oil from 85% to 15% by March 1
Tariffs also reduced on:
Lobsters
Crabs
Peas

Canada will impose a 6.1% tariff on Chinese EVs
China has reportedly purchased its first Canadian canola cargo since October
Canada continues diversifying trade away from the US

🌱 South American Crop Update
Brazil’s soybean harvest is ahead of schedule
2% harvested as of last Thursday
vs. 1.7% at the same time last year
Rainfall has been near normal overall, with slightly drier conditions in southern areas
World Weather notes a La Niña-style dry bias, but says it’s unlikely to threaten production

📊 Fund Positioning (CFTC)
Large speculators were heavy sellers last week:
Corn: Net sellers of 78k contracts
Net short now 91k (largest since late October)
Soybeans: Net sellers of 46k contracts
Net short 20k (largest since mid-October)
Wheat: Net buyers of 1k SRW contracts

🚢 Export Activity
USDA reported multiple corn flash sales:
298k mt to unknown destinations
120k mt to Japan
Both sales are for the 2025/26 marketing year
Accumulated corn sales are now 29% higher than last year

🐄 Cattle Market Shock
Live and feeder cattle futures plunged Friday on screwworm concerns
Texas officials report 14 active cases within 200 miles of the US border
The pest is expected to eventually reach the US

Market reaction:
Live cattle down as much as $4.45
Feeder cattle down as much as $8.10

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Farm Economy Under Pressure
Headlines this week focused squarely on the deteriorating US farm economy. The Wall Street Journal published an article detailing the challenges facing US soybean farmers, including high input costs, weak commodity prices, rising competition from Brazil, and sluggish export demand. The piece also referenced USDA’s $12 billion Farmer Bridge Assistance (FBA) program, noting that while helpful in the short term, it does not address deeper structural issues.
Reuters published similar coverage, emphasizing tighter bank lending standards, increasing financial stress, and a rise in farm bankruptcies. Together, the articles underscore mounting pressure on farmers and the broader ripple effects across rural America.

Soybean Oil & Biofuels
Soybean oil futures surged on Thursday, gaining as much as 3.8% on expectations that the Trump administration will finalize US biofuel-blending quotas by March. Last June, the EPA proposed a sizable increase in biomass-based diesel targets, which would significantly boost soybean oil demand. There is optimism that stronger biofuel demand could help offset weak soybean export performance.

NOPA Crush Update
The National Oilseed Processors Association released its December crush report, showing US soybean crush at its second-highest level on record. NOPA members processed 224.99 million bushels, up 4.1% from November and 8.9% from December 2024, slightly above trade expectations.
For full-year 2025, crush totaled nearly 2.4 billion bushels—an 8% increase from 2024. End-of-month soybean oil stocks rose to 1.64 billion pounds, the highest level since May 2024, up sharply from both last month and last year, though just below average trade estimates.

Brazil Soybean Crop
Brazil’s soybean crop is shaping up to be record large. Agroconsult raised its estimate to 182.2 mmt, citing strong field conditions and limited widespread issues. Meanwhile, Conab trimmed its estimate slightly to 176.1 mmt due to marginally lower yield expectations. Even so, the crop remains record large and would exceed last season’s production.

Export Sales
US corn export sales impressed last week, with net sales of 1.1 mmt. While down from the prior four-week average, the number was a strong rebound from the previous week. Mexico was the top buyer.
Soybean sales exceeded expectations at 2.1 mmt, up sharply week-over-week and well above the recent average. China was the largest buyer. Wheat sales came in near the low end of expectations at 156,300 mt, with unknown destinations leading purchases.

USDA Flash Sales
USDA reported multiple flash sales on Thursday:
Soybeans sold to China and unknown destinations for 2025/26 delivery
Additional soybean sales for 2026/27 delivery
Corn sales to Japan and unknown destinations for 2025/26 delivery

Drought Monitor Update
USDA’s latest drought data showed mixed but generally improving conditions across parts of the Corn Belt and High Plains. Above-normal precipitation helped reduce drought intensity in portions of Wisconsin, Iowa, Michigan, Nebraska, and Kansas, while conditions worsened slightly in southern Missouri.
US Areas Experiencing Drought
Corn: 28%
Soybeans: 34%
Winter Wheat: 41%
Spring Wheat: 10%
Cattle: 34%