Markets Contend with Slowing U.S./Global Demand

USDA预计乙醇使用会大大减少

• The USDA announced that they expect ethanol production to be “at least” 10% lower.
• 当前的玉米研磨量接近31亿蒲式耳，而当前的USDA预测为54.25亿。
• In its April report, the USDA could reduce corn use for ethanol by 10% of the remaining 2.3 billion bushels which would be 230 million bushels.
• Corn used for ethanol would decrease to 5.195 billion bushels, and raise the 2019/20 ending stocks estimate to 2.122 billion bushels if other supply/demand holds steady.

FBN’s Take On What It Means:We believe corn prices will remain under pressure while the market continues to gauge how much demand destruction is taking place. How long the stay-at-home orders are in place globally are still uncertain as US orders have been extended to help contain the spread of the outbreak. For now, all signs point to further demand loss; which is negative for US producers.

Soybeans moving in South America as harvest ramps up

• Parana Bean Harvest几乎完成了92％，而Rio Grande del Sol Harvest完成了58％，平均为47％。
• ABIOVE raised their estimate of last year’s (2019) Brazilian crop estimate to 120.8 mmt vs 118.7
• South American currencies are making new all time lows which encourages producer selling.
• Argentina has exempted export related work from a decree ordering Argentines to stay home until the middle of the month.
• Nearly 4,000 trucks arrived at Parana river ports on Friday vs 1,500 per day at the low point in March, according to data from AgroEntrega.

FBN’s Take On What It Means:Increased buying from China is needed to keep US stocks from growing. China has bought only a small amount of beans from the US, however, instead focusing on abundant cheap supply from South American. If logistics continue to allow mostly unimpeded movement, this will be negative for American growers.

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—Kevin McNew