Check our advice monitor on ProFarmer.com for updates to our marketing plan.
Winter wheat crop enters dormancy with 29% of area under drought... As of Dec. 3, the Drought Monitor showed 71% of the U.S. was covered by abnormal dryness/drought, down three percentage points from the previous week. As U.S. winter wheat entered dormancy, USDA estimated 29% of the crop was experiencing D1-D4 drought conditions, up one point from last week but eight points less than last year at this time. USDA’s estimate doesn’t include D0 (abnormally dry) conditions.
In HRW areas, dryness/drought covered 69% of Kansas (no D3 or D4), 23% of Colorado (virtually no D3, no D4), 47% of Oklahoma (no D3 or D4), 68% of Texas (13% D3 or D4), 94% of Nebraska (8% D3, no D4), 100% of South Dakota (10% D3, no D4) and 95% of Montana (17% D3 or D4).
In SRW areas, dryness/drought covered 55% of Missouri (no D3 or D4), 66% of Illinois (no D3 or D4), 55% of Indiana (no D3 or D4), 66% of Ohio (no D3 or D4), 94% of Michigan (no D3 or D4), 10% of Kentucky (no D3 or D4) and 66% of Tennessee (4% D3, virtually no D4).
Click here to view related maps.
Canada raises wheat crop estimate, lowers canola... Final 2024 Canadian wheat production was estimated at 35 MMT by Statistics Canada, up 700,000 metric tons (MT) from its September forecast and 2 MMT (6.1%) above last year. Of the total, spring wheat accounted for 26.1 MMT, up 800,000 MT from September and 2.2% higher than last year.
Stats Canada estimated canola production at 17.8 MMT, down 1.1 MMT from its previous forecast and 1.3 MMT (7.0%) below year-ago.
Mike Jubinville with MarketsFarm told us, “The current pace of domestic canola crush and exports is running far too hot for a 17.8 MMT crop to support. Something’s got to give. Our canola market is on pins and needles with respect to the dual threats of China’s anti-dumping investigation and Trump’s proposed tariff of 25% on all Canadian imports. The U.S. will likely buy only about 150,000 MT of canola from Canada in 2024-25... but 3 MMT-plus of canola oil for food and biofuel use. And that is a very big deal to us if trade were impaired. Equally, what is the nature of future U.S. biofuel policy... notably 45Z? Does canola oil quality for feedstock with sufficient carbon intensity score? Also, will there be a limitation in 45Z to use only U.S. produced feedstock? We have a rapidly expanding canola crush industry up here... being built to a large extent on continued unencumbered access to the U.S. market.”
On wheat, Jubinville said, “Our crop is high quality/protein. Like the U.S. market, our outlook is all about world events.”
Biofuels industry anxiously awaits 45Z tax credit guidance... The U.S. biofuels industry finds itself in a state of uncertainty as it awaits crucial guidance from the Treasury Department on a tax credit for sustainable aviation fuel (SAF) and other low-carbon biofuels. This delay in the 45Z program details is causing significant concern among producers and politicians alike.
Monte Shaw, executive director of the Iowa Renewable Fuels Association (IRFA), highlights the severity of the situation: “The reality is we need (the) Treasury to issue 45Z guidance immediately. Simply put, biodiesel production is in jeopardy as we speak.”
Shaw reports that fuel producers in Iowa are slowing production or even shutting down while waiting for this guidance. The lack of clear guidelines is not only affecting current production but also hindering future planning for SAF and other low-carbon projects.
The delay also impacts corn and soybean producers, who need to know the conditions under which to grow their crops to produce eligible feedstocks for low-carbon fuels. Shaw emphasizes: “Producers and the entire supply chain need rules in place in order to make crucial feedstock decisions now.”
Farmers supplying corn and soybeans for this program could potentially receive higher prices for commodities grown using sustainable practices that reduce the lifecycle greenhouse gas emissions of the fuel.
Sen. Chuck Grassley (R-Iowa) is concerned about the delay, stating on social media that it is “disruptive” to the biofuels industry. A spokesperson for Grassley added: “The burden remains on the Biden administration to provide urgently needed guidance on the 45Z tax credit. Farmers and industry stakeholders will suffer the consequences if the Biden administration fails to do so.”
Shaw said there will be “an inevitable delay” during the transition of power if the Biden administration is unable to provide guidance before Jan. 20, which is his biggest concern. “IRFA members were heartened when Speaker (Mike) Johnson (R-La.) noted that Republicans did not support the IRA overall, but that there were parts worth saving,” Shaw said. “IRFA members remember how the Iowa delegation united to protect 45Z and other biofuels provisions from earlier efforts at repeal, and there’s no reason to believe they wouldn’t be able to successfully defend the provisions in the future.”
OMB fast-tracks review of EPA cellulosic biofuel waiver proposal... The Office of Management and Budget (OMB) abruptly concluded its review on Dec. 4 of an EPA-proposed rule to partially waive the 2024 cellulosic biofuel volume requirements and extend the compliance deadline under the Renewable Fuel Standard (RFS). Submitted on Nov. 12, the review wrapped up after just two of seven scheduled stakeholder meetings occurred — one with the American Fuel and Petrochemical Manufacturers, the petitioning group, and another with Marathon Ashland Petroleum. Five other meetings, including those with biogas industry representatives, were canceled, raising concerns about the transparency and inclusivity of the process.
Southern Ag Today: Time to push the panic button... Dr. Joe Outlaw writes in Southern Ag Today, it’s time to push the panic button as farmers face unprecedented financial stress amid congressional delays. Southern crop producers, like farmers nationwide, are grappling with a “cost price squeeze” caused by declining commodity prices and soaring input costs. The Agricultural and Food Policy Center (AFPC) at Texas A&M University, working with 575 top producers nationwide, reports widespread distress. Many farmers claim 2024 has been their worst financial year, with securing financing for 2025 becoming increasingly difficult.
Outlaw cautions that some rely on estimated payments from the stalled FARM Act to obtain refinancing, which Outlaw says “is troublesome to say the least. Why? Neither the FARM Act nor any other disaster/economic aid has been moved forward by Congress.” Others are forced to sell land or pledge it as collateral for operating loans. Projections for 2025 indicate even greater challenges. Farmers question the viability of risking their financial health without timely disaster relief or a new farm bill from Congress.
Outlaw concludes: “Without getting into doomsday scenarios, I just ask the reader to consider the question that I keep getting asked: why should we continue to risk our financial health and continue to see our net worth evaporate when Congress can’t get their act together enough to pass much needed disaster/economic assistance that will help in the short-term or a new farm bill for the longer term?My answer to that question is one of hope more than fact, but I am very hopeful that Congress will act decisively and soon.”
Powell addresses key topics... Federal Reserve Chair Jerome Powell made notable remarks on Wednesday at the DealBook Summit, addressing various topics including cryptocurrency, the U.S. economy, inflation and the Federal Reserve’s independence.
Bitcoin and cryptocurrency. Powell described Bitcoin as a speculative asset comparable to gold, emphasizing that it is “virtual and digital” rather than a competitor to the U.S. dollar. He noted that Bitcoin is not widely used as a payment method or a reliable store of value due to its volatility. He dismissed the idea of a national Bitcoin reserve and reiterated the Fed’s commitment to maintaining a “safe and sound” banking system. Powell also clarified that regulating the cryptocurrency industry is not within the Fed’s responsibilities.
U.S. economy. Powell highlighted the robust state of the U.S. economy, which is growing at approximately 2.5% annually with inflation decreasing from over 7% to around 2.3%. Unemployment remains stable, contributing to economic resilience. He attributed this economic strength to stable growth and improving productivity, which have helped avoid a severe recession despite prior aggressive interest rate hikes.
Interest rates and inflation. Powell indicated that while inflation has moderated, it remains slightly higher than expected. This has led the Fed to adopt a cautious approach toward further interest rate cuts. He suggested the central bank has room to be prudent in its monetary policy decisions due to the economy’s strong performance, but he refrained from confirming whether additional rate cuts would occur at the upcoming December meeting.
Federal Reserve independence. Addressing concerns about potential challenges to the Fed’s independence under a new Trump administration, Powell expressed confidence in maintaining autonomy. He emphasized that Congress established the Fed as an independent institution to serve the public interest rather than political agendas. Powell dismissed speculation about efforts to diminish his authority or create a “shadow chair” role at the Fed. He reaffirmed his intention to complete his term as chair, which ends in May 2026.
Potential economic risks. Powell acknowledged uncertainties surrounding President-elect Trump’s proposed tariffs on major trading partners, which could drive inflation higher. This might complicate the Fed’s efforts to reduce rates or even force it to consider rate hikes again. Despite these risks, Powell remained optimistic about fostering a collaborative relationship with the incoming administration and Treasury Secretary nominee.
Bottom line: Powell’s remarks underscored his confidence in the U.S. economy’s strength while signaling caution in monetary policy amidst persistent inflation and geopolitical uncertainties. His comments also reinforced his commitment to safeguarding the Fed’s independence in an evolving political landscape.
Trump taps Loeffler to lead SBA... President-elect Donald Trump picked Kelly Loeffler to lead Small Business Administration (SBA). “Kelly will bring her experience in business and Washington to reduce red tape, and unleash opportunity for our Small Businesses to grow, innovate, and thrive. She will focus on ensuring that SBA is accountable to Taxpayers by cracking down on waste, fraud, and regulatory overreach,” Trump posted on Truth Social, also noting that she’s co-chairing his inauguration. Loeffler is a businesswoman and former GOP lawmaker from Georgia, serving in the Senate from 2020 to 2021 after being appointed to fill a vacancy. She has a background in business, having worked for companies like Intercontinental Exchange and Bakkt.
Trump taps crypto-friendly leader for SEC... Trump appointed Paul Atkins, a conservative lawyer and former SEC commissioner, to lead the Securities and Exchange Commission. Known for his skepticism of heavy regulation, Atkins is expected to adopt a crypto-friendly stance, a sharp departure from the Biden administration’s aggressive oversight, which included lawsuits against major crypto exchanges. Trump’s move aligns with his campaign promise to support the crypto industry. His endorsement has also energized the memecoin market.