Check our advice monitor on ProFarmer.com for updates to our marketing plan.
Corn producers: Increase 2024-crop sales... March corn futures hit the bottom of our sales target range at $4.50 in late-day trade. With this being the highest price since early October and the market short-term overbought, we advise corn hedgers and cash-only marketers to sell another 10% of 2024-crop in the cash market to get to 30% priced. A breakout above the October high would be an opportunity to get more aggressive on 2024-crop sales.
Corn futures react to bullish data... USDA slashed 2024-25 corn ending stocks 200 million bu., with carryover now projected to fall from year-ago. The corn market responded with March futures hitting the highest level since the beginning of October. Wheat futures also firmed amid a bigger-than-expected cut to ending stocks, while soybeans followed to the upside. Click here for full details.
Changes to USDA’s livestock/meat balance sheets... USDA noted, “The recent discovery of New World screwworm (NWS) in cattle in the Mexican state of Chiapas has resulted in a restriction on the importation of cattle and bison originating from or transiting through Mexico, effective November 22, 2024. Forecasts in this report reflect this restriction, and in the absence of an official timeline for updated import protocols, it is assumed these restrictions will remain in place indefinitely. Subsequent WASDE forecasts will reflect any officially announced changes in policy when they occur.”
USDA raised 2024 beef production, with output now forecast to rise 0.3% from year-ago. This year’s exports were unchanged from last month and are expected to fall 2.6% from last year. USDA also left the 2024 average cash price at $186.68, up $11.14 from last year.
For 2025, USDA lowered beef production, which is now expected to fall 5.1%, reflecting restrictions on Mexican cattle imports. Exports were also lowered to reflect a 12.3% annual decline. USDA raised its average cash steer price $2.00 to $191.00.
USDA trimmed 2024 pork production, though it is expected to rise 1.9% from last year. The export forecast was cut but is still expected to rise 4.3%. USDA raised its average cash hog price by 50 cents to $61.55, up $2.96 from last year.
For 2025, USDA reduced pork production, though it is still projected to rise 2.0% from this year. The pork export outlook was lowered, but shipments are expected to grow another 2.9% next year. The average cash hog price was raised $3.00 to now reflect a 45-cent annual increase.
Ag details in EU/Mercosur trade deal... As we reported on Monday, the European Union and Mercosur bloc reached a trade deal after 25 years of negotiations. Some of the main agricultural components of the agreement include:
- Beef – Mercosur is already a major supplier of beef with annual exports between 100,000 and 120,000 MT. With the new proposal, there will be an additional quota of 99,000 MT with reduced tariffs.
- Poultry – Mercosur is the lead supplier with Brazil exporting 300,000 MT annually. The agreement establishes an additional quota of 180,000 MT.
- Sugar – The agreement creates a quota of 180,000 MT with zero tax. The sugar will be directed to deficit regions of southern Europe and threatens France’s sugar exports.
- Corn – The EU already imports 25% of its needs with 6 MMT to 7 MMT coming from Brazil. The agreement includes an additional quota of 1 MMT of corn and unlimited imports of corn derivatives.This measure represents direct competition to French production of corn derivatives.
- Additional products – The agreement provides new quotas for pork, ethanol, rice, honey, sorghum, orange juice, cachaca, cheeses, yogurt, butter and fruit.
The agreement expands the scope of Mercosur agribusiness in the European market with an estimated gradual elimination of 4 billion euros in tariffs over the next few years. For the ag sector, Brazil is positioned to be the big winner and France the big loser.
Global airlines ‘not making much progress’ on SAF... The aviation industry isn’t moving fast enough to reach its targets for producing and using sustainable aviation fuel (SAF), the head of airline trade body IATA Willie Walsh said, as it aims for net zero emissions by 2050. Walsh pointed to a lack of biorefineries under construction that could produce SAF, many of which require extensive capital expenditure to get built. He said Europe was lagging behind the United States when it came to crafting incentives that could help boost that expenditure.
Walsh said it was unclear what the incoming administration of President-elect Donald Trump would do regarding the Inflation Reduction Act, which contains hundreds of billions of dollars in subsidies for clean energy, and how it would impact ongoing SAF production. “There was quite a lot of progress in the first Trump administration in this area as well. So I don’t think this is a black and white issue,” he said.
Time near for decisions on must-have issues, including agriculture... The House must act this week on a continuing resolution (CR) that is expected to extend into March. The four top appropriators need to reach a consensus on production losses for disaster aid. The four ag committee leaders need a consensus on economic and farm bill baseline/safety net increases via extension of the 2018 Farm Bill. They are running out of time but will get something done. If they act faster, they could do better for producers, sources advise. The next layer is congressional leadership approval, which also takes time, so farm-state lawmakers need to hustle. Currently there is no consensus, and the situation is very fluid.
A disaster aid package is widely expected. Most sources do not think there will be agreement on boosting reference prices via a 2018 Farm Bill extension. Reason: costs. Sources do think some economic aid will be cleared but the dollar level is murky… some say it could total up to $9 billion. That would be a cutback from levels via a bill introduced by Rep. Trent Kelly (R-Miss.).
USDA launches specialty crop assistance program... USDA opened applications for the Marketing Assistance for Specialty Crops (MASC) program, aimed at expanding domestic markets or developing new ones for specialty crops. Backed by $2 billion from the Commodity Credit Corporation, applications are open through Jan. 8, 2025.Key details:
- Payment limit: $125,000 per producer.
- Eligibility: Producers must market raw U.S.-grown specialty crops (e.g., fruits, vegetables, herbs).
- Payment basis: Based on 2023 or 2024 sales; adjusted for funding constraints.
- Targeted support: High marketing costs, including labor (45% of variable costs), have strained the specialty crop sector, risking reduced domestic availability.
Payments will follow a tiered model, with smaller-scale producers receiving higher payment factors. If demand exceeds funding, payments will be prorated.
CN reaches deal with Unifor workers... Canadian National Railway (CN) says it has reached a tentative four-year agreement with the union representing mechanical, clerical and intermodal workers. Employees represented by Unifor voted in late November to authorize a strike if a deal wasn’t reached by Jan. 1. CN won’t release details of the agreement until it is ratified. The current collective agreement expires on Dec. 31.