Is 45Z Dead? + Improved Argentina Forecast

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A bipartisan group of senators has reintroduced the Farm to Fly Act to speed up the production of SAF. The legislation would clarify SAF eligibility in the USDA's current bioenergy programs and expand markets for crops used in SAF production. It would also clarify the federal definition of SAF for USDA purposes and promote more collaboration on aviation biofuels within the USDA. Six senators from the Midwest reintroduced the bill. Agriculture, aviation, and energy groups have all expressed support for the legislation. The reintroduction came one day after President Donald Trump signed an executive order freezing any new federal rules for 60 days, including the 45Z tax credit guidance.

USDA reported a flash sale of corn on Wednesday. US exporters sold 136,000mt (5mil bushels) of corn to unknown destinations for delivery during the 2024/2025 marketing year. Current marketing year corn sales are the third best in the last ten years.

China has suspended Brazilian soybean shipments from five companies. China's General Administration of Customs halted the shipments after finding pesticides and pests during a routine inspection. Authorities did not release the number of cargoes or the volume of soybeans affected by the suspension. However, the Brazilian Ministry of Agriculture reported that the ban is not expected to affect Brazil's overall soybean exports to China. The ministry is expected to provide China with the necessary information to lift the temporary suspensions. The firms included in the ban are some of the largest soybean suppliers to China.

Weather forecasts for southern Brazil and Argentina have turned slightly wetter. Rains are slated to return to southern Brazil and northern Argentina by Sunday. Southern Brazil, in particular, should see widespread coverage during the next 5 days. The 5-10 day period introduces slightly better rainfall for key Argentina soybean areas. This morning's extended GFS model, however, is again drier for much of Argentina's soybean country. Despite the rain, parts of Argentina, including Buenos Aires, may remain drier than normal.

President Donald Trump is pressuring Russia to negotiate an end to the war with Ukraine. On Wednesday, Trump said that Russia needs to make a deal to end the war, or the US will impose tariffs, higher taxes, and sanctions on Russian imports. The same would apply to other countries providing financial support to Russia. It's unclear which specific Russian goods would be targeted, but Russia's main oil producers could be included. Tariffs, however, won't be overly impactful given that the US only imported about $4.6 billion worth of Russian goods in 2023, accounting for only 0.2% of total imports. Another option would be to target third-country banks that facilitate Russian transactions.

President Donald Trump's nominee for Agriculture Secretary previously opposed ethanol and farm subsidies. Brooke Rollins served as president and CEO of the Texas Public Policy Foundation from 2003 to 2018. During that time, the organization claimed that government support for ethanol led to an increase in emissions and a rise in food and fuel prices. In 2016, while Rollins remained in her position with the nonprofit, the group advocated for the elimination of farm subsidies. Despite Rollins' controversial history on policies affecting farmers, more than 400 state and national agricultural groups endorsed her to lead the USDA. Rollins will appear before the Senate Agriculture Committee today for her nomination hearing.