Global Ag News for Jan 17.24

TOP HEADLINES

Musk’s SpaceX to Help Deere Connect Farmers to the Internet

The world’s largest tractor maker Deere & Co. is working with Elon Musk’s SpaceX to connect rural areas of the US and Brazil to internet satellites.

Tractors in the two countries can be outfitted with SpaceX’s Starlink terminal that connects to Deere’s operations center starting in the second half of this year as part of an “industry first” partnership, Deere said in a Tuesday statement.

A tractor and round baler at a John Deere dealership in Shelbyville, Kentucky.

“We are bringing satellite communications service to the farm at scale so farmers with cellular coverage challenges can maximize the value of connectivity to their operations,” Deere Chief Technology Officer Jahmy Hindman said in the statement.

Farmers have been using satellite-assisted technology since the late 1990s and, more recently, SpaceX’s Starlink system has been pitched to the agricultural industry as a way to provide rural areas with reliable internet. Only 30% of big US farmers professed to having “high quality” internet, according to a 2022 survey, while growers are increasingly reliant on machinery that measures and tracks how each seed is planted, fertilized and harvested.

The collaboration comes when farmers have been buying fewer tractors amid falling crop prices, and as Deere seeks to generate 10% of its revenue through “recurring” models such as subscription fees by 2030. The partnership was first reported by the Wall Street Journal.

FUTURES & WEATHER

Wheat prices overnight are up 3 1/4 in SRW, up 1/2 in HRW, down 1/4 in HRS; Corn is down 1; Soybeans down 7 1/2; Soymeal down $0.70; Soyoil down 0.63.

For the week so far wheat prices are down 10 3/4 in SRW, down 13 1/4 in HRW, down 9 1/4 in HRS; Corn is down 4 1/2; Soybeans down 4 1/4; Soymeal up $8.50; Soyoil down 1.64.

For the month to date wheat prices are down 42 3/4 in SRW, down 40 in HRW, down 33 in HRS; Corn is down 28 3/4; Soybeans down 78 1/4; Soymeal down $15.60; Soyoil down 1.56.

Year-To-Date nearby futures are down 6.8% in SRW, down 6.2% in HRW, down 4.6% in HRS; Corn is down 6.1%; Soybeans down 5.7%; Soymeal down 4.0%; Soyoil down 2.6%.

Chinese Ag futures (MAY 24) Soybeans up 18 yuan; Soymeal up 12; Soyoil up 2; Palm oil up 34; Corn down 8 — Malaysian Palm is down 44. Malaysian palm oil prices overnight were down 44 ringgit (-1.14%) at 3818.

There were changes in registrations (-446 SRW Wheat, -34 Soymeal, -48 HRW Wheat). Registration total: 849 SRW Wheat contracts; 0 Oats; 6 Corn; 650 Soybeans; 125 Soyoil; 20 Soymeal; 214 HRW Wheat.

Preliminary changes in futures Open Interest as of January 16 were: SRW Wheat up 9,882 contracts, HRW Wheat up 2,540, Corn up 19,032, Soybeans up 9,157, Soymeal up 873, Soyoil up 5,378.

Brazil: Showers in central Brazil were somewhat isolated over the weekend and will continue to have low coverage this week. Heavier rain across the south has been favorable for some of the drier areas, including Sao Paulo and Parana. A slow-moving front will bring widespread showers to southern areas mid-late week and boost showers for central areas this weekend. Overall, the weather situation is improved or improving and even the drier stretch in central Brazil is not overly concerning for filling soybeans. Soil moisture is not adequate for safrinha corn, however, and more consistent showers will be important for planting, which should start up in the next couple of weeks.

Argentina: Scattered showers fell over a good portion of the country over the long holiday weekend. Another system will bring rounds of heavier rain through Tuesday and Wednesday, especially for northern areas. Drier conditions are looking likely afterward through the middle of next week or possibly longer. Soil moisture continues to be very good across most of the country and should be able to handle a period of drier weather with little disruption to development. If the drier period lasts too long, it could be more concerning, however.

Australia: Scattered showers fell across some limited areas over the long weekend, favorable where they hit, especially those areas in the west that have been very dry. Two systems are nearby that should continue showers early this week.

Northern Plains: Extremely cold arctic air will continue to be in place this week, but should be replaced by mild air this weekend. Harsh cold has had a detrimental effect on livestock and for those that care for them. A round of light to moderate snow is forecast to come through on Thursday, adding to some of the cold concerns.

Central/Southern Plains: A blast of arctic cold has fallen across most of the region this weekend, and came with some additional snow Sunday and Monday. Much of the winter wheat crop is covered by recent snow, but much of Oklahoma and Texas have been uncovered and are more susceptible to winterkill. Some moderation is expected midweek but another burst of energy will bring another round of harsh cold for late week and weekend. The snow is most likely in Nebraska yet again, but the harshest cold should be shorter as warmer air floods the region next week.

Midwest: The region is tired of huge winter storms after seeing tons of snow and blizzard conditions over the last week. Harshly cold, arctic air will be in place throughout the week, though will have a brief moderation midweek before a clipper comes through with more snow on Thursday and Friday and another arctic blast. The cold will not last all that long as warm air moves back in early next week. Some areas have been exposed to the arctic cold and thus susceptible to winterkill on winter wheat.

Delta: Harsh cold air brought in a wintry mix of precipitation Sunday into Monday. Any snow may protect winter wheat from the arctic temperatures. Another burst of very cold air will move in Friday through the weekend that could also create issues for wheat. Recent heavy storms of the last week or so have significantly boosted water levels on the Mississippi River, which should increase transportation for at least a little while.

The player sheet for Jan. 16 had funds: net sellers of 3,000 contracts of SRW wheat, sellers of 3,500 corn, sellers of 1,000 soybeans, buyers of 3,000 soymeal, and  sellers of 2,000 soyoil.

TENDERS

• CORN SALE: The U.S. Department of Agriculture confirmed private sales of 126,700 metric tons of U.S. corn to Mexico for shipment in the 2023/24 marketing year.
• MILLING WHEAT SALE: Algeria’s state grains agency OAIC has bought milling wheat in an international tender that closed on Tuesday.
• WHEAT TENDER: Egypt’s General Authority for Supply Commodities is seeking wheat in an international purchasing tender. The deadline for offers is Jan. 17.
• CORN, BARLEY TENDERS: Algerian state agency ONAB has issued international tenders to purchase around 160,000 metric tons of animal feed corn and 30,000 metric tons of feed barley
• DURUM, MILLING WHEAT TENDER: Tunisia’s state grains agency has issued an international tender to purchase about 150,000 metric tons of soft milling wheat and around 50,000 tons of durum wheat.
• VEGOIL TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said on Tuesday it was seeking vegetable oils in an international purchasing tender for arrival Feb. 25-March 10 and/or March 11- 25. GASC said traders should submit bids for payment both at sight, as well as via 180-day letters of credit. The deadline for offers is Jan. 18.
• MILLING WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is looking to buy a total of 87,641 metric tons of food-quality wheat from the United States and Canada in a regular tender that will close on Jan. 18.

PENDING TENDERS

• WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins.
• FEED WHEAT AND BARLEY TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) said it will seek 60,000 metric tons of feed wheat and 20,000 tons of feed barley via a simultaneous buy-and-sell (SBS) auction that will be held on Jan. 17.

TODAY

US Inspected 876k Tons of Corn for Export, 1.264m of Soybeans

In week ending Jan. 11, according to the USDA’s weekly inspections report.

• Wheat: 234k tons vs 502k the previous wk, 326k a yr ago
• Soybeans: 1,264k tons vs 1,041k the previous wk, 2,192k a yr ago
• Corn: 876k tons vs 1,092k the previous wk, 780k a yr ago

US Corn, Soybean, Wheat Inspections by Country: Jan. 11

Following is a summary of USDA inspections for week ending Jan. 11 of corn, soybeans and wheat for export, from the Grain Inspection, Packers and Stockyards Administration, known as GIPSA.

• Soybeans for China-bound shipments made up 694k tons of the 1.26m total inspected
• Mexico was the top destination for corn inspections, Japan led in wheat

US December Soy Crush Climbs to Record, Tops Estimates: NOPA

Processing of 195.328 million bushels beats average trader estimate of 192.6 million bushels, according to National Oilseed Processors Association data released Tuesday by Thomson Reuters.

• That’s above any previous month, according to Reuters
• Year-ago level was 177.5 million bushels
• Soybean oil stocks stood at 1.36 billion pounds at the end of December, above expectations for 1.254 billion pounds
  • Compares with year-ago level of 1.791 billion pounds

NOPA December US soy crush jumps to record 195.328 million bushels

U.S. soybean processors crushed more soybeans in December than any previous month on record, closing out a banner year for the industry with their three largest crush months ever, according to National Oilseed Processors Association (NOPA) data released on Tuesday.

NOPA members, which account for around 95% of soybeans crushed in the United States, processed 195.328 million bushels of soybeans last month, compared with 189.038 million bushels processed in November and up 10% from the December 2022 crush of 177.505 million bushels.

The average daily crush rate of 6.301 million bushels in December matched November’s record-high daily crushing pace, NOPA data showed.

U.S. crush capacity has swelled as rising demand for vegetable oils to produce renewable fuels encouraged processors to build new plants or expand existing ones.

The soybean processing industry has been among the few bright spots for U.S. agriculture as crop exports are slumping and as prices for grain and oilseeds hover near multi-year lows.

NOPA’s December crush topped the average trade estimate of 193.120 million bushels in a Reuters survey of 10 analysts. Estimates ranged from 189.000 million to 197.380 million bushels, with a median of 193.200 million bushels.

Soyoil stocks among NOPA members as of Dec. 31 rose for a second straight month to 1.360 billion lbs, above all trade estimates and the largest end-of-month oil supply since September.

NOPA members’ oil supplies were up 12.1% from the 1.214 billion lbs on hand at the end of November but down 24.0% from stocks totaling 1.791 billion lbs at the end of December last year.

Analysts, on average, had expected stocks to rise to 1.291 billion lbs, according to estimates gathered from seven analysts.

Soyoil stocks estimates ranged from 1.190 billion to 1.350 billion lbs, with a median of 1.289 billion lbs.

Argentina set for soy, corn ‘super harvest’ as estimates keep rising

Argentina is set for a corn and soy “super harvest” with production forecasts likely to keep climbing, a senior analyst at the Rosario grains exchange told Reuters on Tuesday, a major boost to the embattled grains-producing South America country.

Cristian Russo, head of agricultural estimates at the Rosario grains exchange, said that both corn and soy had “very good chances” of topping the body’s current harvest forecasts of 59 million metric tons and 52 million tons respectively.

“Argentina is on course for a ‘super harvest’ of both corn and soybeans,” said Russo, citing good rains that the country’s farming regions have been receiving for months, a relief after the previous season was hammered by drought.

“Week after week we keep getting water,” he added, saying that corn had a very good chance of posting a record harvest that could even top 60 million tons.

The bumper crop is positive news for the country that is battling its worst economic crisis in decades, with the government trying to rebuild depleted state coffers after the previous harvest was hit by a historic drought.

Argentina is usually the world’s top exporter of processed soy oil and meal – its main cash crop – and is the No. 3 for corn. However, it lost its soy crown last year to neighboring producer Brazil after its crop was cut in half by drought.

With the far better weather this year boosted by strong rainfall due to the El Niño climate trend, the Rosario exchange last week hiked its 2023/24 soy estimate by 2 million tons.

Argentina’s corn and soybeans sowing is finishing, and most plants are going through important growth phases with good levels of humidity in the soil and without extreme heat.

According to the latest weather report from the Rosario exchange, published on Tuesday, storms over the core farming zone have dropped significant rains, with between 20-50 millimeters over the last 24 hours and more expected.

Brazil 2023/2024 Soybean Crop Seen At 153.4 Million Tns Versus 160.1 Million Tns In Previous Forecast – Hedgepoint

BRAZIL 2023/2024 SOYBEAN CROP SEEN AT 153.4 MILLION TNS VERSUS 160.1 MILLION TNS IN PREVIOUS FORECAST – HEDGEPOINT

Brazilian farmer lobby says 2023/2024 soy crop estimates are too high

An association representing thousands of grain farmers in Brazil projects production of 135 million metric tons of soybeans in the 2023/2024 cycle, according to a statement on Tuesday that mentioned extreme weather as hurting the outlook for the crop as the season progresses.

Aprosoja Brasil’s estimate is lower than private forecasters’ projections of production that starts at around 143 million tons.

It is also well below Brazilian crop agency Conab’s expectations of 155 million tons and a U.S. Department of Agriculture projection putting the crop at 157 million tons in the world’s largest supplier of soybeans.

Both Conab and the USDA released their figures last week.

“The publication of data that does not match reality has caused a downward trend in prices,” Aprosoja Brasil said. “Farmers, in addition to having reduced yields, have to deal with prices that are incompatible with reality.”

The Brazilian farmer group said its estimate is based on information collected from Aprosoja branches in 15 states.

Benchmark soy contracts traded in Chicago reflect Brazil’s crop outlook but also factor in expectations of much larger soy harvests in Rio Grande do Sul state and neighboring Argentina, where drought slashed output in 2023.

Weak demand from China, the world’s biggest soy importer, has also been pushing prices lower.

Aprosoja Brasil said water stress in Center-Western states such as Mato Grosso, Goias and Mato Grosso do Sul and the excess rainfall in certain areas of these same states are disrupting grain harvesting that is underway. It said this situation may lead to even greater losses for farmers this year.

“There are also reports from farmers in the south of the country, mainly in the state of Parana, who suffered from excessive rainfall at the beginning of planting and are now facing a lack of rain in areas where soybeans are in the reproductive phase, which compromises crop yields,” Aprosoja Brasil said.

Due to climate risk, Aprosoja Brasil said its crop forecast could be revised lower if the weather does not improve.

EU 2023/24 soybean imports 6.29 mln T by Jan 14, rapeseed 3.03 mln T

European Union soybean imports so far in the 2023/24 season that started in July had reached 6.29 million metric tons by Jan. 14, compared with 6.19 million a year earlier, data published by the European Commission showed on Tuesday.

EU rapeseed imports in the same period totalled 3.03 million tons, against 4.24 million a year earlier.

Soymeal imports totalled 8.01 million tons against 9.00 million a year ago, while palm oil imports stood at 1.85 million tons versus 2.13 million a year earlier.

EU 2023/24 soft wheat exports at 16.88 mln T by Jan 14

Soft wheat exports from the European Union since the start of the 2023/24 season in July had reached 16.88 million metric tons by Jan. 14, compared with 18.17 million a year earlier, data published by the European Commission showed on Tuesday.

EU barley exports totalled 3.29 million tons, against 3.09 million tons in the corresponding period in 2022/23, while EU maize imports were at 9.52 million tons, against a year-earlier 16.38 million.

However, the Commission said grain export data for Italy was missing since Dec. 30.

FranceAgriMer Cuts Soft-Wheat Export Estimate; Stockpiles Raised

Soft-wheat exports from France are seen at 17.01m tons in the 2023-24 season, below a December outlook for 17.2m tons, crops office FranceAgriMer said in a report.

• Outlook trimmed for both EU and non-EU sales
• Stockpiles estimate raised to 3.43m tons, from 3.22m tons

BARLEY

• Export estimate cut to 7.32m tons, from 7.56m tons
• Stockpiles forecast raised to 2.1m tons, from 1.81m tons

CORN

• Export estimate cut to 4.15m tons, from 4.19m tons
• Stockpiles seen at 2.18m tons, up from 2m tons

Export duty on Russian wheat declines 5.3% as of January 17, barley remains at zero – Agricultural Ministry

The export duty on Russian wheat has declined 5.3% to 3,946.5 rubles per tonne as of January 17 from 4,165.9 rubles per tonne the previous seven days, the Agriculture Ministry said.

The duty on barley remains at zero, and the duty on corn has decreased to 973.1 rubles per tonne from 1,431.7 rubles per tonne.

The duties are based on indicative prices of $250.70 per tonne for wheat against $250 per tonne the previous period, $172.30 per tonne for barley versus $172.30 per tonne, and $191.20 per tonne for corn against $195.20 per tonne.

The latest duties are valid until January 23, inclusive.

The Russian government on June 2, 2021, introduced a grain damper mechanism that stipulates floating duties on exports of wheat, corn, and barley, as well as returning the funds received from the duties in order to subsidize agricultural producers. The duties are calculated weekly on the basis of price indicators based on the value of export contracts registered on the Moscow Exchange (MOEX: MOEX).

The Agriculture Ministry on June 1, 2023, hiked the baseline price for calculating the export duty on wheat, the so-called cut-off price, to 17,000 rubles per tonne from 15,000 rubles per tonne, and raised the baseline price on barley and corn to 15,875 rubles per tonne from 13,875 rubles per tonne.

The government on June 30, 2022, adopted a resolution to convert the duties into rubles as of July 2022. The duty totals 70% of the difference between the baseline price and the indicative price.

China 2023 pork output jumps 4.6% y/y to 57.94 mln tons

China’s pork output in 2023 rose 4.6% from a year earlier to 57.94 million metric tons, data from the National Bureau of Statistics showed on Wednesday.

China slaughtered 726.62 million hogs in the 12-month period, up 3.8% from a year earlier, the data also showed.

Singapore’s marine biofuel demand could double by 2025 -TotalEnergies exec

Marine biofuel demand at the world’s largest bunker hub Singapore could potentially double by 2025 to almost 1 million metric tons from 2023 levels as shippers seek to cut emissions, a senior TotalEnergies executive said.

More shipping companies have been conducting refuelling trials using marine biofuel as an alternative to conventional fuel oil to reduce carbon emissions.

“Looking ahead to 2025, we foresee a potential surge in biofuel (bunker) demand in Singapore, potentially nearing 1 million (metric) tons per annum,” Louise Tricoire, vice president at TotalEnergies Marine Fuels told Reuters.

Bio-blended marine fuel sales at Singapore more than tripled to over 500,000 tons last year, data from Singapore’s port authority showed.

Total sales in 2023 surpassed initial estimates as regulations on carbon intensity indicator (CII) boosted growth, said Tricoire.  A CII is a measure of how efficiently a ship transports goods or passengers in grams of carbon dioxide emitted per cargo-carrying capacity and nautical mile.

The International Maritime Organization last year approved interim guidelines on how certified sustainable biofuels could be used to improve a ship’s CII rating.  However, the demand outlook is still contingent upon biofuels pricing and development of more infrastructure such as barging and tanking facilities, said Tricoire.

Bunker prices of B24 bio-marine fuel blend remain at least $200 above 0.5% low sulphur fuel oil, a price gap that still deters mass adoption, industry sources said.

TotalEnergies Marine Fuels is among Singapore’s key marine biofuel suppliers in 2023, though it declined to comment on specific volumes. Its biofuel offerings are second-generation product and ISCC-certified.

Demand for lower-carbon marine fuel is poised to increase from this year globally as the European Union Emissions Trading System kickstarts for the shipping industry.

This means ships have to pay for their generated emissions so burning lower-carbon marine fuel helps lower costs.

Net carbon emissions can be reduced by nearly 20% using a biofuel blend compared to using traditional fuel oil, a trial by the Global Centre of Maritime Decarbonisation found.

LIVESTOCK SURVEY: US Cattle on Feed Placements Seen Falling 4.5%

December placements onto feedlots seen falling y/y to 1.7m head, according to a Bloomberg survey of ten analysts.

• Would be the second consecutive y/y decline following -1.9% in November
• Estimates range from -8.5% to -2% y/y change
• Feedlot herd as of Jan. 1 seen rising by 2.2% y/y to 11.93m head
• Marketings seen falling 0.7% y/y

Malaysia Still Facing Labor Shortages in Plantations: Minister

Malaysia is in urgent need of foreign workers in the plantation and agriculture sectors, with the shortages affecting productivity of crops like rubber and palm oil, according to Home Minister Saifuddin Nasution Ismail on Tuesday.

• Other sectors including construction, manufacturing and services have sufficient workers, Saifuddin told a press briefing in Putrajaya after holding a committee meeting with Human Resources Minister Steven Sim on the management of foreign workers
• Saifuddin has met with Plantation and Commodities Minister Johari Abdul Ghani to better understand shortages in the plantations sector
• Government may review agreements with the 15 countries that supply foreign workers to look into factors such as fees, costs, and contract terms
• Ministries will present a cabinet paper at the end of January on restarting a “recalibration” program for foreign workers that have overstayed
  • Will look into possibility of re-assigning surplus workers from other sectors to meet the shortages in plantations

El Nino Rains Fuel Bumper Harvest for Paraguay Soybean Exporters

• Capeco expects first soy crop to reap about 9.5 million tons
• Upbeat outlook adds to signs of already well supplied marketBy Ken Parks

The first of two Paraguayan soybean crops is set to match last year’s total harvest as El Nino rains boost growing conditions in the South American country, according to trade group Capeco.

The upbeat outlook for the region’s No. 3 producer of the oilseed adds to signs of an already well supplied global market, with prices down about 6% this year. While the El Nino weather phenomenon spells dry conditions for northern Brazil, it tends to bring rains that support crops in the central and southern growing belts of South America.

With about a 10th of the current crop harvested, Paraguayan growers may reap about 9.5 million metric tons, Capeco Executive Director Hugo Pastore said in an interview. That would equal the combined harvests of last year, in a boost to exports in the landlocked country.

“There is optimism that we could have a good year,” said Pastore, who sees the harvest ending a month later in March because weather delayed planting in late 2023.

Last year, Paraguay’s soy exports more than doubled to almost 6.5 million tons worth $3.4 billion as rains helped farmers recover from a drought the previous season.

Argentina’s purchases of those exports soared to 93% after a deep drought slashed its harvest, according to central bank data. This year, Argentina’s share of Paraguayan soy shipments probably will return to the normal 70% level, with other traditional buyers including Brazil and Russia taking the rest, Pastore said.

Paraguay Soy Group Fears EU Deforestation Rules Could Hurt Trade

EU rules that ban imports of commodities and derived products sourced from deforested land could disrupt trade in soybeans if conditions in producing nations like Paraguay aren’t taken into account, said Hugo Pastore, executive director of grain and oilseed export group Capeco.

• Capeco is concerned that the EU won’t recognize Paraguayan government deforestation data
  • “If the authority in charge of forestry says soy came from an area that wasn’t deforested that should be recognized” by the EU, Pastore said in an interview
  • Capeco doesn’t oppose the gradual implementation of a soy traceability system in Paraguay
• NOTE: EU deforestation rules enter into full force in Dec. 2024, with the cut off date for deforested or degraded land set at Dec. 2020

Ukrainian Border Blockade Boosts Transport Costs by 15-20%

The blockade of automobile cross-points on Ukrainian western borders has increased transportation costs by as much as 20% and caused significant losses to European exporters unable to deliver goods to Ukraine, said Deputy Agrarian Minister Markiyan Dmytrasevych.

• NOTE: Polish farmers and transporters started blocking Ukrainian border in November; Slovak truckers and then Romanian colleague joined them later
• Romanian farmers and truck drivers are protesting for a 7th day across the country, blocking roads around major cities and border crossings, including at the border with Ukraine, demanding lower car insurance costs, faster EU subsidy payments and compensation for losses they say they incurred because of the cheaper Ukrainian grain imports
• Negotiations continue with the Romanian government to end the protest
• “The reason for the blocking is not so much a question to Ukraine, but a demand to local authorities for bigger subsidized support,” Dmytrasevych said in interview to local ICTV channel. “But so far protests caused only losses, as transportation costs because of downtime increased by 15-20%”
• Currently, Ukraine exports about 85% of grain by water routes, including Danube ports and Ukrainian Black Sea corridor, according to Dmytrasevych. “December export results show that only 2% of stuff were moving by automobiles,” he said, adding that “these ways are still important”

EU Soft-Wheat Exports Drop 7% Y/y in Season Through Jan. 14

The European Union’s soft-wheat exports in the season that began on July 1 were at 16.9m tons as of Jan. 14, compared with 18.2m tons a year earlier, the European Commission said on its website.

• NOTE: The report only includes export data for Italy up to Dec. 30
• Leading destinations include Morocco, at 2.3m tons; Nigeria at 1.6m tons; and Algeria, with 1.5m tons
• Barley exports were at 3.3m tons, up 7% y/y
• Corn imports were at 9.51m tons, down 42% y/y

3tentos Will Invest BRL1b in Corn Ethanol Plant

Corn processing plant will be built in Porto Alegre do Norte, Brazil’s Mato Grosso, and will produce produce corn ethanol and distillers’ dry grain (DDG), used as animal feed.

• “North of Mato Grosso and Para state are very promising areas for DDG demand, as pastures seen converted into grain fiels,” 3Tentos CEO Luiz Osorio Dumoncel said in a conference call with analysts
• Facility is expected to start running at the beginning of 2026, according to co’s COO Joao Marcelo Dumoncel
• Total investment of 2 billion reais ($408 million) will also include increasing soy crushing capacity in 60% and biodiesel production capacity in 35% by 2030
  • 73% of investments will be made between 2024 and 2025
  • 30% of money will come from cash flow, 45% from other long term sources and 25% from structured operations
• Shares rise as much as 9.3% in Sao Paulo Tuesday, the biggest intraday jump since February
  • The company’s stock trades for 11.83 reais as of 10:30 a.m. in Sao Paulo

New Corn Ethanol Project Adds to Brazil’s Grain Biofuel Craze

Tres Tentos Agroindustrial SA’s plan to build its first corn ethanol plant in Brazil adds to a wave of investments to turn grain into biofuel in the world’s largest crop supplier.

The Rio Grande do Sul-based agribusiness company said on Monday that it will spend more than 1 billion reais ($203 million) in a facility with capacity to produce 935 cubic meters per day of ethanol, the equivalent of roughly 5% of Brazil’s current output level, starting in 2026. The plant will be based in Mato Grosso, the nation’s largest farming state.

Ever-expanding supplies of corn and government incentives have fueled a race for new ethanol plants in key farming states in the South American agricultural powerhouse. That’s causing a seismic shift in Brazil’s biofuel industry, which has for decades relied on sugar-cane as its main feedstock. A greater focus on corn mimics the US, where ethanol is heavily based on the grain.

Tres Tentos is betting that corn supplies will continue to rapidly expand in central Brazil as crop yields improve and more pastures are converted into farmland, Chief Executive Officer Luiz Osorio Dumoncel said Tuesday on a conference call.

The corn ethanol project is part of a broader 2 billion reais investment plan that is also aimed at boosting the company’s soybean processing and biodiesel production volumes. The initiative also includes spending in grain transportation and storage assets in the Amazon region through a venture with local soybean processor and exporter Caramuru Alimentos SA.

Tres Tentos rose as much as 9.3% in Sao Paulo Tuesday, the biggest intraday gain since February.

Winter Weather Halts Chicken Processing in the South

Cold weather is temporarily halting operations at poultry plants in the American south. Wayne-Sanderson Farms, the third largest chicken processor, says it shut down or cut shifts at several of its facilities in Alabama, Mississippi, Arkansas and Texas on Tuesday because of severe weather. Tyson Foods, the largest U.S. meat supplier, says it scaled back operations at some U.S. facilities on Tuesday due to winter weather and is working to fulfill customer orders at other locations, a spokeswoman said. Tyson and rival Cargill suspended operations at beef plants in western Kansas last week after a snow storm.

 

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