Lower Start to Week as Markets Wait For RVO/SRE and 45Z Guidlines

General weakness was seen in the grains and soy markets on improved rain chances for the driest parts of Argentina and S Brazil in the 12–14-day overnight forecasts while sizable losses in the equities and the metals added to the general market weakness. The energy markets were the only major market to move decisively higher as year-end profit taking and positioning dominated today’s market volume. A small bean sale to Egypt was announced this morning while China remained absent in the daily export sales report. The rest of the New Year’s Day interrupted trading week has the potential to see the Trump administration finally release the RVO/SRE and 45Z guidelines which would help the market with certainty on bean oil demand and have the potential for this administration to install meaningful progress toward increasing domestic demand for US grown beans. The USDA should also release the rest of their government shutdown delayed weekly export reports to give the trade better demand baseline numbers heading into the major January 12^thUSDA report.

News and Notes:

• Consistency in rain for the driest regions of Argentina has entered the forecasts for the 12-14-day runs, but the next 10 days will be unusually dry with increasing heat for the first crop stress of the season. Forecasts remain good for early harvest in N Brazil to begin in early January and the yields will be watched closely as a barometer for the general outlook of a potential 6.6 BBU total Brazilian bean crop. After record warmth on Christmas, the US pattern has turned more seasonal with the New Year expected to see normal cold temperatures with normal snow events.
• The daily December new crop chart is on Page 2 and shows today’s dramatic failure at month-old overhead resistance in the upper $4.60s to fall back below the 20 and 50 DMAs. With significant corn still on farm and year-end tax plans being enacted, old crop sales were part of the selling catalyst and pulled new crop prices lower in their wake. The final catch up CFTC fund position reports should be out this week to show exactly where the funds are placed heading into 2026. The likely fund position, the strong US demand but ample supply, all suggest that both old and new crop corn will stay range bound into late winter unless the USDA cuts 2025 corn yields by more than 2 BPA on January 12^th. The demand is too strong to see much downside below $4.60 for December, but if the US farmer decides to plant 95 MA or more in 2026, then $3.90-$4.10 (2025 harvest low for Dec ’25) becomes the eventual downside target. Finishing weather in SA, planting intentions for the US in 2026 and then pollination forecasts are the ultimate drivers of corn price.
• A routine bean sale to Egypt of 3.7 MBU did not help the bulls waiting on an increase in year-end Chinese bean purchases. But cash connected sources did indicate several major Chinese buyers were asking for quotes on today’s pullback. The ongoing trade game of musical chairs is only shifting world bean supplies around but not increasing demand, which solves no long-term oversupply problems.
• Please send me an email or a text with any update on how the paperwork and communication with the FSA offices and getting the Farmer Assistance Checks is going for you. Finding reliable information on the USDA website is futile.

Without a continued weather scare in Argentina, the expected news flows this week will not be too interesting once the USDA and CFTC are caught up on their old reports. Supply (SA yields and potential US planted acres) and demand (China and new RVO mandates) will remain the major market drivers well into 2026. Unfortunately, without a poor end to SA or a major (not quite 2012) US growing season problem, a pattern very similar to 2024 and 2025 may unfold. Developing a marketing plan for 2026 will be a challenge, but putting off the planning or ignoring it all together will only make the challenge even greater. Taking advantage of all pre-pay and early season discounts to help keep your break evens as low as possible is the first step to take. Every day except Thursday (closed) will be a full day of trade this week.