While it may not seem like it from day to day, supply and demand is more of a factor in price discovery now than we have seen in several years. Many analysts are currently trying to predict future commodity demand. While this is difficult in a normal year, the spread of the coronavirus this year is making the task even harder.
The biggest shift in demand is in the ethanol industry. The drop in crude oil usage to historically low levels caused roughly one-third of all U.S. ethanol plants to halt operations. This is nearly 1.8 billion bushels of corn demand that is now in question. While many of these plants will resume operations, some will not. This will not only change the outlook on corn balance sheets for this year, but likely for many years to come.
It is quite likely the USDA is currently underestimating soybean crush at the present time. The decrease in distillers grains from ethanol ...
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