Muted December WASDE? - The Corn & Ethanol Report

We kicked off the day with NFIB Business Optimism Index at 5:00 A.M., ADP Employment Change Weekly at 7:15 A.M., Redbook YoY at 7:55 A.M., JOLT’s Job Openings and JOLT’s Job Quits at 9:00 A.M., 6-Week Bill Auction at 10:30 A.M., Crop Production, USDA Supply/Demand, WASDE, and EIA Short Term Energy Outlook at 11:00 A.M., 10-Year Note Auction at 12:00 P.M., API Energy Stocks at 3:30 P.M., and Day 1 FOMC Meeting.The New York Fed’s monthly survey of consumer’s inflation expectations for the year ahead in November showed that expectations were unchanged from October. The median one-year-ahead inflation expectation was at 3.2%. Expectations in the 2025 surveys ranged from 3.00-3.63. Historically, consumers tend to overestimate inflation in the one-year-ahead survey. Since 2013, actual inflation rates have been below the year-ahead-expectation 77% of the time by an average of 1.37%, and above expectations 21% of the time by an average of 2.4%. Consumer expectations for the year ahead tend to be a function of current inflation rates and have very little predictive value. The only value is that the survey is often wrong by a wide margin.Photo by Waldemar on UnsplashAgriculture Commodity DemandAg Resources (ARC) reports that ag commodity demand overall will be challenged by slowing global population expansion and an acceleration in China’s population contraction. Newly released IMF data featured China from 2025 to 2030 losing an additional 17.8 million persons. China’s population in 2030 will have lost 25 million persons from 2020 to 2030. No longer will China drive global food demand growth. India and select smaller nations in Southeast Asia take over that mantle, but India’s willingness to be self sufficient in wheat and lack of meat demand are noteworthy. Big picture themes keep in pace ARC’s desire to scale into 2026 – and eventually2027 – hedges on periodic rallies. El Nino, which on balance bodes well for US crop yields, is projected to emerge in spring/summer.Corn Comments & AnalysisCBOT Corn Continues Struggle at Chart Resistance; Dec WASDE to be Uneventful; Black Sea Cash Market in Retreat:Corn bulls and bears continue to fight for pennies within a range of $4.35-$4.50, basis March, the rest of December will be defined by monitoring weather in Argentina & Southern Brazil. Neural price action is forecast for another few weeks, but ARC weather premiums will be extracted more intensely in January amid the absence of drought in S Brazil and the absence of heat in Argentina. USDA is unlikely to make many-if any changes to US supply & demand in today’s WASDE. There will be no need to ration supply via price without the quick arrival of drought to Argentina/Southern Brazil or an early end to Northern Brazil’s wet season in March. The Ukrainian cash market has been actively probing for new demand, yesterday cash was offered just $.11/Bu above US Gulf origin on a fob basis. This reflects the narrowest Ukrainian premium since February. Rallies only attract new sellers & competition. Catch up on sales on near-term rallies. A re-test of $4.10-$4.20, basis March, is forecast Q1 2026.More By This Author:Soybean Bulls Retreat As China Demand Disappears - The Corn & Ethanol Report Wheat To Undercut Corn As Sorghum Gains - The Corn & Ethanol Report Early Dec SA Weather Forecast Bearish. The Corn & Ethanol Report