Grain Crushings

Grain Crushings

Soybeans Crush: 6,393,408 Tons (▼2.0% MoM, ▲4.6% YoY)

Soyoil Stocks: 2.315 Billion Pounds (▼5.0% MoM, ▲23.4% YoY)

Biofuel Demand (inedible use): 690,228,000 lbs (▲0.5% MoM)

Analysis 

May’s grain crushings came in strong at 523.7M bushels, a 9% bounce from April’s seasonal lull and 5% above last May. Fuel alcohol usage jumped back to 471.8M bushels, consistent with the weekly EIA data that showed production hitting new highs for this time of year at 1.117M barrels per day. Cumulative crop year corn for ethanol has reached 4.644B bushels through late June, running well above the pace needed to hit the USDA’s 5,575M bushel marketing year estimate. Corn distillers oil surged 9% month over month to 206.3K tons and 6% above year ago levels, reflecting the ongoing pull from the renewable diesel buildout. The WASDE projects soybean oil biofuel use jumping to 17.8B lbs in 26/27, and CDO is riding that same wave.

December corn settled at 439.90 on Tuesday, sitting just below its 200 day moving average near 440.78 and beneath the 50 day at 450.15. A close above 446, the recent swing high, opens the door toward that 50 day. Support sits at the 412.50 area with the contract low at 406.25 below that. Soybean oil has been under severe pressure, trading at 65.48 with an RSI of 18, deeply oversold after collapsing from the 79.69 high. The 200 day moving average near 60 is the next major support if the selling continues. The CDO production increase adds marginally to feedstock supply, but the broader renewable diesel demand story remains the dominant driver for the veg oil complex.