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There weren’t many bright spots in Monday’s USDA data deluge, which underscored the need to find ways to further lift demand. The reaction wasn’t pretty, particularly for corn, with the March contract dropping 24 ¼ cents after unexpected yield and harvested acreage increases boosted last year’s crop above 17 billion bushels as domestic and global carryout also rose.
Ethanol advocates wasted no time making their case.
“Today’s surprise USDA report serves as a sobering wake-up call about the state of (the) farm economy and underscores the need for lawmakers to take immediate action to expand markets for America’s corn growers,” said Renewable Fuels Association President and CEO Geoff Cooper, in a statement.
“The fastest and easiest way to shore up the growing supply-demand imbalance in the corn market is to permanently remove the summertime barrier on E15 sales and eliminate obsolete fuel retail infrastructure rules,” Cooper said. “These decades-old regulatory barriers are literally choking off demand and shortchanging America’s farmers.”
PF Report Reaction: Corn and soybean production higher than expected
USDA forecast 5.6 billion bushels of ethanol demand for corn, unchanged from its December estimate and up from 5.436 billion bushels in 2024-25. The biofuels industry was left frustrated at the end of 2025 as the Environmental Protection Agency delayed issuing blending rules for 2026-2027 until the first quarter. Meanwhile, ethanol groups have kicked off the new year by banging the drum for year-round E15, the 15% ethanol fuel blend.
Last week, a coalition of 70 groups sent a letter to congressional leadership making the case for year-round adoption.
Cooper argued that expanding access to higher ethanol blends represents the most effective path to creating long-term stability in the corn market, creating new demand, over time, for more than 2 billion bushels of corn and sorghum.
Powell vs. Trump gets real… Wall Street was briefly rattled Monday after Federal Reserve Chair Jerome Powell said the central bank had been served with subpoenas and threatened with a criminal indictment by the Justice Department over his congressional testimony over renovations to the Fed’s headquarters. Powell, in a video released Sunday night, termed the moves a “pretext” aimed solely at attempting to pressure the Fed to lower interest rates.
Gold surged overnight, while U.S. stock-index futures slumped, the dollar fell and Treasury yields rose on selling tied to renewed fears over Fed independence. A joint statement issued by a bipartisan array of former central bank chiefs, including Janet Yellen, Ben Bernanke and Alan Greenspan, and other former economic policy officials warned: “The Federal Reserve’s independence and the public’s perception of that independence are critical for economic performance, including achieving the goals Congress has set for the Federal Reserve of stable prices, maximum employment, and moderate long-term interest rates. The reported criminal inquiry into Federal Reserve Chair Jay Powell is an unprecedented attempt to use prosecutorial attacks to undermine that independence. This is how monetary policy is made in emerging markets with weak institutions, with highly negative consequences for inflation and the functioning of their economies more broadly.”
Stock-market investors appeared to shake off concerns, at least for now, with the Dow Jones Industrial Average finishing with a gain of 86 points, or 0.2%, while the S&P 500 advanced 0.2%, with both indexes building on Friday’s record finishes.
China quotas pressure Brazil meatpackers… Brazil, the world’s top beef exporter, is on track to lower production after China, its main buyer, put quotas on imports, Bloomberg reported. China in December announced a beef quota smaller than what Brazil has shipped in recent years, which is expected to force meatpackers to trim production this year, the report said, with banks and consulting firms cutting forecasts. That means supplies that were already set to shrink due to lower cattle availability could see an even steeper fall than previously expected, the report said.
Bloomberg said the drop would make for a more challenging year ahead for Brazil’s meat industry as well as for companies such as JBS NV, Minerva SA and MBRF Global Foods Company SA, which have large operations in the South American nation. The impact already is being seen with shares falling since China’s Dec. 31 announcement, the report noted.