Dan Flynn is the writer of The Corn & Ethanol Report, a daily market letter covering grains, energies, and various global issues that are the driving force and backbone of the commodity markets. Contact Mr. Flynn at (312) 264-4374
We kickoff the last day of April with Employment Cost – Benefits QoQ, Employment Cost – Wages QoQ, and Employment Cost Index QoQ at 7:30 A.M., Redbook YoY at 7:55 A.M., S&P/Case-Shiller Home Price MoM & YoY, House Price Index MoM & YoY, and House Price Index at 8:00 A.M., Chicago PMI at 8:45 A.M., CB Consumer Confidence at 9:00 A.M., Dallas Fed Services Index and Dallas Fed Services Revenues Index at 9:30 A.M., API Energy Stocks at 3:30 P.M., and Day 1 FOMC Meeting.
The USDA’s April food inflation forecasts narrowed the range of expectations and lowered the average. The USDA estimated US food inflation in a range of 0.7% to 3.8%, with an average estimate of 2.2%. The upper end of the range was the lowest estimate since the 2024 estimates began in July 2023, the lower estimate was the highest. The average estimate of 2.2% was at a 3-month low. If realized, it will be the 2nd consecutive year of declining food inflation rates and the largest 2-year decline since 1976. While the rate of inflation is expected to decline, food prices will again reach a new all-time high in 2024. What can Biden-omics do for an encore. On the weather front corn farmers plantings got off to a good start with 27% planted vs. 23% last year and will want to get back in the fields provided the recent rainfall hopefully did not cause any flooding, ahead of round 2 of storms. We have a wetter forecast in the next 6-15 day period. An active pattern persists across the E Plains, Midwest, and Delta into the coming weekend, with additional rain chances being added May 8th to 10th . We also have Crop Production, USDA Supply/Demand, and WASDE on May 10th . Rainfall in the extended range is projected to favor areas east of the Mississippi River, with spotty showers advertised in the Dakota’s and Minnesota. It’s an outright wet forecast, and a lengthy period of warmth and dryness is desired mid-May onward. This morning we are coming in lower in the grain futures based on larger than expected deliveries in May soybean oil, wheat and soybeans.
The EPA/Biden Administration is expected to announce revised GREET model for measurement of carbon intensity of biofuel feedstocks today. The updated model was expected to be released in March but was delayed. The revised GREET model is critical to determining the eligibility of sustainable aviation fuel for new tax credits created by the Inflation Reduction Act. Key will be monitoring how US ethanol is scored and pathways forward to dropping its carbon score under 50%. To achieve a sub-50% carbon score requires US farmers adapting no till farming practices, plant a cover crop or start using precision fertilizer applications. There may be another delay in announcing the revised GREET model with the attention is on college riots taking front stage.
US Plantings & Weather Key. The Corn & Ethanol Report 04/30/2024
We kickoff the last day of April with Employment Cost – Benefits QoQ, Employment Cost – Wages QoQ, and Employment Cost Index QoQ at 7:30 A.M., Redbook YoY at 7:55 A.M., S&P/Case-Shiller Home Price MoM & YoY, House Price Index MoM & YoY, and House Price Index at 8:00 A.M., Chicago PMI at 8:45 A.M., CB Consumer Confidence at 9:00 A.M., Dallas Fed Services Index and Dallas Fed Services Revenues Index at 9:30 A.M., API Energy Stocks at 3:30 P.M., and Day 1 FOMC Meeting.
The USDA’s April food inflation forecasts narrowed the range of expectations and lowered the average. The USDA estimated US food inflation in a range of 0.7% to 3.8%, with an average estimate of 2.2%. The upper end of the range was the lowest estimate since the 2024 estimates began in July 2023, the lower estimate was the highest. The average estimate of 2.2% was at a 3-month low. If realized, it will be the 2nd consecutive year of declining food inflation rates and the largest 2-year decline since 1976. While the rate of inflation is expected to decline, food prices will again reach a new all-time high in 2024. What can Biden-omics do for an encore. On the weather front corn farmers plantings got off to a good start with 27% planted vs. 23% last year and will want to get back in the fields provided the recent rainfall hopefully did not cause any flooding, ahead of round 2 of storms. We have a wetter forecast in the next 6-15 day period. An active pattern persists across the E Plains, Midwest, and Delta into the coming weekend, with additional rain chances being added May 8th to 10th . We also have Crop Production, USDA Supply/Demand, and WASDE on May 10th . Rainfall in the extended range is projected to favor areas east of the Mississippi River, with spotty showers advertised in the Dakota’s and Minnesota. It’s an outright wet forecast, and a lengthy period of warmth and dryness is desired mid-May onward. This morning we are coming in lower in the grain futures based on larger than expected deliveries in May soybean oil, wheat and soybeans.
The EPA/Biden Administration is expected to announce revised GREET model for measurement of carbon intensity of biofuel feedstocks today. The updated model was expected to be released in March but was delayed. The revised GREET model is critical to determining the eligibility of sustainable aviation fuel for new tax credits created by the Inflation Reduction Act. Key will be monitoring how US ethanol is scored and pathways forward to dropping its carbon score under 50%. To achieve a sub-50% carbon score requires US farmers adapting no till farming practices, plant a cover crop or start using precision fertilizer applications. There may be another delay in announcing the revised GREET model with the attention is on college riots taking front stage.
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