06/26/2025 What’s Next

On the Grains
Good morning, yesterday’s WIA weekly ethanol report showed production slightly decreasing to 1.081 MBPD, down only slightly from last week’s 1.190 MBPD. With 10 weeks remaining, we need to average 1.11 MBPD to meet the USDA’s 5.5-billion-bushel usage target, which would be a 2.8% increase from last year. This week’s production numbers came in at 3.6% higher year-over-year, and the 4-week average is up 5.3%, giving us no reason to believe we won’t meet USDA’s targets. Also, fuel to the proverbial fire, US gasoline demand rose to 9.68 MBPD, the highest weekly gain since 2021, and up 8% from the same week last year. The amount of Milo converted into ethanol remains a concern and a potential black swan; however, these numbers suggest that we will meet the USDA’s targets. The political red tape surrounding ethanol in the US continues to be frustrating, as Brazil now has a 30% blend, up from 27%, starting in August, while the US struggles to achieve a 15% year-round blend. We could increase the value of our corn and enhance the economic viability of rural communities by simply adjusting the blend requirements, even without a carbon pipeline, with just the stroke of a pen.