Country News
Brazil: Ethanol prices rose based on an expected hike in the gasoline tax. An increase in the CIDE tax would take 90 days to become effective and would impact gasoline only, but the PIS/Cofins tax could be increased immediately and would impact both gasoline and ethanol.
Separately, China’s CITIC AgriFund bought Dow’s Brazilian corn seed operation for $1.1 billion. The sale was required by Brazilian antitrust regulators as a condition for Dow’s merger with DuPont. (Platts; Reuters)
China: Supply – the July 2017 China Agricultural Supply and Demand Estimates (CASDE) slightly raised expected corn yields and overall production while boosting its estimate of soybean imports. It lowered expected 2016/17 corn imports to 800 KMT from the earlier estimate of 1 MMT. The expected 2017/18 corn area was reduced due to a faster-than-expected decline in summer corn planting in Hebei, Shandong and Henan Provinces.
Reserve Corn Sales – the National Grain Trade Center reports that 2.6 MMT of 2014 crop corn was sold from state reserves on July 14. That is 87 percent of the amount offered and it sold at an average price of 1,492 yuan/MT ($220.51). On July 20, it sold 54,115 MT of 2013 corn (9.14 percent of offering) at 1,250 yuan/MT ($184.80) plus 867,667 MT of 2014 corn (88.35 percent of offering) at 1,442 yuan/MT ($213.18).
GMO’s – the government approved two new GMO corn events for importation. The approvals are part of a bilateral agreement with the U.S. to speed up approvals. Meanwhile, some companies are asking that the process of approval be made more transparent and science-based. (Reuters)
Indonesia: The Ministry of Energy and Mineral Resources reports that it would implement fuel ethanol production incentives, but it lacks the financial resources. Indonesia will produce 205 million liters of nonfuel ethanol from molasses in 2017 and 2018 but has not produced fuel ethanol since 2010. (Ethanol Producer Magazine)
Mexico: The white corn market in Mexico has been showing quite a bit of activity lately. Offers are currently at $234/MT and recent shipments have been reported from West Coast Mexico to Kenya and Venezuela.
South Sudan: Army worms have infested 25 percent of the arable crop land and are destroying corn and sorghum plants. The FAO says that half the population is at risk of starvation. Now that the caterpillar has arrived, it is here to stay and could now spread to the Mediterranean and into Asia. (Bloomberg)