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🌽 Ethanol & E15 Push

The Renewable Fuels Association is calling for year-round, nationwide sales of E15 following Monday’s bearish USDA report. The group says allowing E15 nationwide could eventually create demand for more than 2 billion bushels of corn and sorghum.

The RFA is urging Congress to pass the Ethanol for America Act, finalize Renewable Fuel Standard volume requirements, limit small refinery exemptions, and reallocate any waived volumes.

Despite the push, year-round E15 is unlikely to materially boost ethanol demand in the near term:
Infrastructure: Many stations would need upgraded tanks, pumps, gaskets, and EPA sign-offs
Consumer behavior: Most drivers don’t know what E15 is and are hesitant to buy it
Production capacity: US ethanol production is already near capacity
An E15 mandate would be the fastest way to meaningfully increase corn demand—but that would require new plants, new infrastructure, and billions of dollars.

🚜 Trade Policy Risk: USMCA

President Trump said this week that the US-Mexico-Canada Agreement is now “irrelevant” and no longer benefits the US. The agreement is up for review this year, with renewal requiring all three countries to agree by July 1.
Mexico has been the largest buyer of US corn in recent years. Any disruption to USMCA would be a major risk to corn exports. See chart below.

🥩 Beef Prices Hit New Records

Ground beef prices averaged $6.82/lb in December, up 16% year over year. Steak prices averaged $12.51/lb, up 18%.

Beef prices remain a major driver of higher food costs and are expected to keep rising into 2026 due to historically low US cattle inventories and new dietary guidelines encouraging higher animal-protein consumption. See beef charts below.

🌱 Soybean Flash Sales
USDA reported multiple soybean flash sales on Tuesday:
168,000 mt to China
152,404 mt to Mexico
Both are for delivery during the 2025/26 marketing year.

📊 Inflation Update

The December CPI showed inflation at 2.7% year over year, unchanged from November and in line with expectations. Food prices jumped 0.7% month over month, the largest increase since October 2022.
Despite tariff concerns, inflation remains relatively stable, and the report is unlikely to change the Fed’s cautious stance on rate cuts. See CPI chart below.

🌎 Largest US Landowner

The owner of the LA Rams and Denver Nuggets is now the largest landowner in the US. Stan Kroenke recently purchased 1 million acres in New Mexico, bringing his total US landholdings to over 2.7 million acres.

Other top landowners include:
Emmerson Family: ~2.5 million acres
John Malone: ~2.2 million acres
Ted Turner: ~2.0 million acres
Jeff Bezos: ~462,000 acres
Bill Gates: ~275,000 acres

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🌽 Corn

Corn futures plunged on Monday, with prices down nearly 6%, marking the largest single-day decline since June 2023. The selloff followed a decidedly bearish report from the USDA.

The agency raised its estimate of the 2025 U.S. corn crop to a record 17.02 billion bushels, up 269 million bushels from the prior forecast. USDA also increased last year’s national average yield to a record 186.5 bpa, up from 186 bpa previously. Many analysts had expected cuts to both production and yield following dry fall conditions, making the revisions a surprise.

USDA also boosted December 1 corn stocks to 13.3 billion bushels, the largest Dec. 1 corn stocks on record.

🌾 Winter Wheat

US winter wheat acreage is expected to decline marginally for the 2026 crop. USDA estimates 33.0 million acres planted, slightly below last year’s 33.2 million acres but above analyst expectations of 32.4 million.

Notably, USDA is forecasting record-low winter wheat acres in Nebraska and California.

Hard red winter wheat: slightly lower year over year
Soft red winter wheat: modest increase
White winter wheat: sharp decline

🚜 Farm Policy & Aid

The American Farm Bureau Federation is calling for additional farmer aid. AFBF President Zippy Duvall said the Trump administration’s $12 billion Farmer Bridge Assistance program is welcomed, but falls far short of offsetting tens of billions of dollars in recent farm losses.

Duvall is urging:
Expanded trade opportunities
Labor reform
Year-round approval of E15, which could boost corn demand and lower fuel costs

Farm Bureau supports greater market access for U.S. agriculture while opposing President Trump’s tariffs.

🚢 Exports & Demand

US soybean shipments beat expectations last week. USDA reported 1.5 mmt (56 mil bu) of soybeans inspected for export during the week ending January 8 — up 55% week over week and up 13% year over year. China accounted for 59% of the total.

Corn inspections: 1.5 mmt (59 mil bu), near the upper end of expectations
Wheat inspections: 317,465 mt (12 mil bu), sharply higher week over week

USDA also announced multiple flash sales of corn:
204,000 mt to South Korea
310,000 mt to unknown destinations
Both for 2025/26 delivery.

🏛️ Macro & Markets

Republican lawmakers are pushing back against the Justice Department’s investigation into Jerome Powell, arguing it could undermine Fed independence. Treasury Secretary Scott Bessent reportedly warned President Donald Trump that the probe could spook financial markets.

Trump denied knowledge of the investigation, which comes amid months of pressure on the Fed to cut interest rates further. The controversy could complicate Trump’s efforts to nominate Powell’s successor.

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🌽 USDA Reports Preview (Crop Production, WASDE & Grain Stocks)
USDA will release its monthly Crop Production and WASDE reports on Monday, along with the quarterly Grain Stocks report.
• Analysts expect a notable decline in US corn production and yield, though both would still be record large
• Soybean production and yield are forecast to slip modestly
• US ending stocks for corn and wheat are expected to edge lower
• Soybean ending stocks are projected to increase slightly
• Corn exports are forecast at record highs
• Soybean exports are expected to decline amid slow sales to China
• World ending stocks are expected to remain largely unchanged

🇨🇳 China Buys More US Soybeans
China purchased at least 10 cargoes of US soybeans on Friday for April–May shipment.
• At least eight cargoes will ship from the US Gulf
• The remainder will ship from the PNW
• The deal follows another 10-cargo purchase earlier in the week by Sinograin
• Several smaller flash sales were also reported last week
Despite the recent buying, traders remain uncertain about if and when the soybeans will ultimately ship.

🚢 USDA Flash Sale Update
USDA reported a flash sale of 198,000mt (7 mil bushels) of soybeans to unknown destinations for the 2025/26 marketing year.
• Accumulated US soybean sales are down 29% vs. last year

🇧🇷 Brazilian Soybean Harvest Begins
Brazil’s soybean harvest is underway and running ahead of normal.
• 0.53% harvested vs. a five-year average of 0.39%
• Only 0.05% was harvested at this time last year
• Warm, dry weather is expected to persist
Both Conab and USDA are projecting a record Brazilian soybean crop.

📊 CFTC Fund Positioning
For the week ending January 6:
• Funds were net buyers of corn
• Net sellers of soybeans (continuing a large liquidation trend)
• Net sellers of SRW wheat

💳 Trump Calls for Credit Card Rate Cap
President Trump is calling for a 10% cap on credit card interest rates for one year, down from current rates near 20%.
• Banks warn the move could reduce credit availability
• Riskier borrowers could face credit line cuts, higher fees, or larger minimum payments
• Proposal could take effect as early as January 20
Shares of some credit card companies were lower this morning, with Capital One down about 2.5%.

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🌽 USDA Crop Production & WASDE Preview
USDA will release its monthly Crop Production and WASDE reports on Monday, alongside the quarterly Grain Stocks report. Analysts are expecting a notable decline in U.S. corn production and yield, while soybean production and yield are forecast to slip modestly. U.S. ending stocks for corn and wheat are projected to edge lower, while soybean ending stocks are expected to increase slightly. World-ending stocks are forecast to remain mostly unchanged, except for wheat, where a sizable increase is anticipated.

📉 2026 Corn Price Outlook
Ample global corn supplies are expected to keep prices under pressure in 2026. University of Missouri Extension ag economist Ben Brown expects U.S. corn acreage to fall to 95 million acres this year as farmers respond to tight margins. Even with fewer acres, last year’s record corn crop continues to weigh on prices. Brown sees limited upside unless a major South American weather event hits yields—and even then, any rally is likely to be short-lived. Ethanol demand remains a bright spot, and finalized biofuel regulations could provide additional support. Ultimately, meaningful price improvement will require reduced global production.

🚢 Weekly Export Sales
U.S. corn export sales were weak last week. For the week ending January 1, net corn sales hit a marketing-year low at 377,600 mt (15 million bushels), down 49% from the previous week and 76% below the prior four-week average. South Korea was the top buyer. Despite the poor weekly number, accumulated corn sales remain 30% above last year.
Net soybean sales totaled 877,900 mt (32 million bushels), down 26% week-over-week and 42% below the four-week average. China accounted for roughly half of total sales.
Net wheat sales came in at 118,700 mt (4 million bushels), below expectations for the second straight week. Sales were up 24% from last week but down 55% from the four-week average. The Philippines was the largest buyer.

🐄 Cattle Markets & Screwworm Update
New World screwworm cases in Mexico have dropped sharply in recent weeks. Mexico’s ag ministry reports cases are down 57% since mid-December, with 492 active cases concentrated in a handful of states. Construction of a sterile-fly breeding facility in southern Mexico is roughly halfway complete and is expected to begin operations in the first half of this year. Despite improvement, three cases have been confirmed in Tamaulipas near the Texas border since late December. The ongoing border closure, in place since May 2025, continues to tighten feeder cattle supplies and push cattle prices to record highs.

🌱 China Soybean Flash Sale
USDA reported a soybean flash sale on Thursday. U.S. exporters sold 132,000 mt (5 million bushels) of soybeans to China for delivery in the 2025/26 marketing year. China has now completed more than 80% of its 12 mmt U.S. soybean purchase agreement.

🌡️ Drought Monitor Update
USDA’s latest drought monitor shows worsening conditions across much of the Corn Belt following a warm, dry winter. About 37% of the Corn Belt is now experiencing some level of drought, up from 29% at this time last year. The High Plains also saw temperatures well above normal—some areas running as much as 15°F above average—resulting in the driest start to winter on record in parts of the region.

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🌱 Grain Markets

Soybean futures rallied on Wednesday, with the Mar26 contract jumping nearly 11 cents to settle around $10.67. The move was driven by renewed Chinese demand, including reports that Sinograin purchased multiple U.S. soybean cargoes, plus a confirmed flash sale to China earlier this week. Corn and wheat futures also closed higher.

🥩 New U.S. Dietary Guidelines

Updated U.S. dietary guidelines place a stronger emphasis on protein intake and full-fat dairy, while discouraging ultra-processed foods, added sugars, and refined carbs. The new guidance calls for protein at every meal and higher daily intake levels than previously recommended. Unlike past guidelines, there’s less focus on plant-based proteins or whole grains. The American Heart Association pushed back, warning of potential cardiovascular risks tied to higher consumption of red meat, salt, and full-fat dairy.

🌽 Ethanol Update

U.S. ethanol production declined modestly last week, while ethanol stocks increased. Despite the production dip, margins remain solid across much of the Corn Belt, with many plants still running comfortably in positive territory based on current corn, DDG, and input prices.

🏠 Housing & Interest Rates

Mortgage rates dropped to their lowest level in more than a year. Lower borrowing costs have boosted both home purchase activity and refinancing interest, with buyers responding quickly to improved affordability.

🏘️ Institutional Home Buying Debate

President Trump proposed banning institutional investors from purchasing single-family homes as part of a broader housing affordability push. Markets reacted negatively, though economists note institutional investors own only a small share of the total housing stock. Critics warn the policy could reduce housing supply and potentially worsen affordability rather than improve it.

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🍭 Sugar, Diet Guidelines & Corn Demand

The Trump administration is expected to advise Americans to cut back on sugar consumption under the new Dietary Guidelines set for release later this week. Americans—especially children—will be encouraged to consume no more than 10 grams of added sugar per meal. The guidelines are also expected to push lower consumption of highly processed foods and encourage higher daily protein intake.

The existing recommendation limiting saturated fat to no more than 10% of daily calories is expected to remain unchanged. One challenge could be implementation in schools, as many cafeterias aren’t equipped to prepare meals from scratch.

Corn plays a major role here. In 2023, added sugars—including high-fructose corn syrup and glucose/dextrose—accounted for roughly 770 million bushels of corn demand, or about 5.3% of total U.S. corn usage.

🌱 China Buys U.S. Soybeans

USDA reported a soybean flash sale on Tuesday, with exporters selling 336,000 mt (12 million bushels) to China for delivery during the 2025/26 marketing year.

According to traders, China’s state stockpiler Sinograin purchased roughly 10 U.S. soybean cargoes this week, totaling about 600,000 mt (22 million bushels) for shipment between March and May. Estimates suggest China’s total U.S. purchases are now nearing 10 mmt, representing more than 80% of the reported 12 mmt purchase agreement.

Additional flash sales may be reported today given ongoing trade chatter.

🚢 Brazil Export Update

Brazil’s soybean exports hit a record high in 2025, according to shipping agency Cargonave. Shipments rose 11.7% year over year to 108.68 mmt, driven by a record harvest and surging Chinese demand.

Soybean meal exports also reached a record 23.1 mmt, while corn exports totaled 41.7 mmt, up nearly 11% from last year. Brazil is once again projected to produce a record soybean crop in the coming season.

🚜 Farmer Sentiment Slips

U.S. farmer sentiment declined modestly in December. Purdue University’s CME Group Ag Economy Barometer fell to 136, down slightly from November. The drop was driven by weaker long-term expectations, while near-term sentiment held steadier.

Trade policy remains a major concern. Nearly one-fifth of farmers said they’re uncertain how tariffs will affect the ag economy long-term. Competition from Brazil continues to weigh heavily on soybean outlooks. Still, three-quarters of respondents believe the U.S. is headed in the right direction—the highest reading since the question was introduced.

📈 Stocks, Oil & Venezuela

U.S. equity markets rallied Tuesday despite geopolitical uncertainty. The Dow Jones climbed to a new record above 49,000, while the S&P 500 and Nasdaq also hit record highs.

Markets appear to view recent U.S.–Venezuela developments as modestly bullish for oil supply. Late Tuesday, President Trump announced Venezuela would turn over 30–50 million barrels of sanctioned oil to the U.S. In response, WTI crude fell to $56.25 per barrel.

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🌎 Geopolitics & Oil
The U.S. removal of Nicolás Maduro could significantly complicate **China’s oil and investment ties with Venezuela.

For years, China has been Venezuela’s largest oil buyer and creditor. While Venezuelan crude made up just about 4% of China’s total oil imports last year, it has played an important role in diversifying China’s energy supply.

President Trump’s push to take control of Venezuela’s oil industry is expected to weaken China’s influence in the region, introduce financial risks for Chinese banks, and force Beijing to reassess its broader Latin America strategy.

Through 2015, China extended more than $60 billion in oil-backed loans to Venezuela for infrastructure and energy projects. Roughly 20% of those loans are believed to be unpaid—raising major questions about repayment now that Maduro is out of power.

We’ve seen similar U.S. responses before when foreign powers got “too close to home,” including:
Cuba / Soviet Union (1962)
Grenada / Soviet Union (1983)
Panama / Noriega (1989)

🚢 Export Inspections
USDA reported stronger soybean inspections last week.
Soybeans: 980,518 mt
Up from the prior week
Down vs. last year
China accounted for roughly 40%

Corn: 1.2 mmt
Lower vs. last week
Strongly higher vs. last year

Wheat: 183,305 mt
Below expectations
Sharply lower week-over-week and year-over-year

Marketing-year-to-date shipments:
Soybeans: sharply behind last year
Corn: well ahead
Wheat: modestly higher

📊 Export Sales (Catch-Up Report)
USDA released its final catch-up export sales report for the week ending December 25.
Soybeans: Solid weekly sales, with China the top buyer
Corn: Toward the low end of expectations, led by Mexico
Wheat: Below expectations, with Colombia the top destination

🌱 Brazil Crop Update
StoneX raised its Brazilian soybean production estimate slightly to a record 177.6 mmt, citing excellent December growing conditions and strong yields in Mato Grosso.
Conab: 177.6 mmt
USDA: 175 mmt
Based on current USDA estimates, Brazil’s soybean crop is more than 50% larger than the U.S. crop this season.
Weather outlook from World Weather suggests generally favorable conditions, though parts of southern Argentina will need closer monitoring due to expected drying.

💰 Fund Positioning
The CFTC is now fully caught up on Commitment of Traders data.
Funds continued selling corn and soybeans
Soybean fund length has dropped sharply since mid-November
Small net buying was seen in SRW wheat

🥇 Metals & Macro
Gold and silver surged amid rising geopolitical tensions.
Prices jumped following Maduro’s removal and comments from President Trump that the U.S. will now control Venezuela, including access to its oil reserves. Tensions also escalated after Trump reiterated his interest in Greenland, prompting sharp pushback from Denmark, which warned such a move would effectively end NATO.

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🌍 Geopolitics & Energy
The US captured Venezuelan President Nicolás Maduro and his wife over the weekend. Both have been indicted on multiple charges, including narco-terrorism conspiracy, cocaine trafficking, and weapons offenses. Maduro is now being held in a federal prison in New York and is expected to make his first court appearance today in Manhattan.
The unprecedented military intervention drew condemnation from Russia and China, while Argentina expressed support. President Trump said the move was necessary to address drug trafficking and what he described as “stolen oil,” adding that the US will be strongly involved in Venezuela’s oil industry going forward.
Crude oil futures fell on last night’s open but are trading near unchanged this morning. The bigger selloff was in natural gas, which is down more than 2.5% early today. Venezuela holds the largest crude oil reserves in the world, though accessing them will take years and massive capital investment. The country also has large natural gas reserves, which could be easier to develop.

🚜 Farm Aid Update
USDA announced payment rates under the Farmer Bridge Assistance Program on New Year’s Eve. The agency will distribute $12 billion total, with $11 billion allocated to one-time payments for row crops and $1 billion directed to specialty crops and sugar.

Payment rates:
Corn: $44.36 per acre
Soybeans: $30.88 per acre
Wheat: $39.35 per acre

Payments are based on 2025 planted acres. Second crop acres are eligible, while prevent plant acres are excluded. Farmers are expected to receive payments by the end of February. See graphics below. Click HERE and HERE for USDA links.

🌱 Grain Markets & Weather
Soybean futures fell on Friday, with the Mar26 contract down nearly 10 cents before recovering. China’s purchase program now appears to be a mostly “known” factor for the current marketing year, with expectations that China will reach the 12mmt US purchase target over the next couple of months.
Brazil’s forecast turns slightly drier early this week, while southern Argentina remains dry for at least another week.

🐄 Livestock
Mexico reported new cases of New World screwworm last week, including a goat in central Mexico and a calf in Tamaulipas near the US border. No additional animals tested positive at either site.
The news sent live and feeder cattle futures sharply higher. The US–Mexico border is expected to remain closed to Mexican feeder cattle imports for the foreseeable future. Since November 2024, authorities have recorded over 13,000 cases, with several hundred currently active.

⛽ Ethanol
US ethanol production rose to a weekly high last week at 1.12 million barrels per day. Output was higher week-over-week and year-over-year. Ethanol stocks increased slightly but remain below last year’s levels.
According to Reuters data, ethanol margins remain positive across the Corn Belt, ranging from roughly 5 to 25 cents per gallon.

🚢 Export Sales
USDA released another delayed export sales report:
Soybean sales missed expectations and were sharply lower week-over-week, with China accounting for most of the total
Corn sales exceeded expectations, led by Mexico
Wheat sales came in near the low end of expectations