NASHVILLE, TENN. (RFD-TV) — U.S. crush facilities are significantly reducing feedstock supplies. Trader Brian Hoops told RFD-TV News that the markets are still trying to digest the latest report, showing more than 220 million bushels were crushed last month.
“Now, that was below estimates, and below the previous months, but it is a new all-time record for the month, beating last year’s 210 million bushels used in November,” Hoops said. “So, using a lot of product there for crush. Same thing for corn — corn use for ethanol, about 472 million bushels — that was right in line with where we were a year ago and just slightly below last month. So, some positive demand news to talk about.”
Consumer demand, of course, drives most production areas. Data from Prosper Insights & Analytics show that fuel sensitivity remains a key factor in rural America. About one quarter of rural residents say fuel prices influence how much they drive, and researchers say that can tip the scales on just how much ethanol is needed.
Ethanol production last month rose to just over 1.1 million barrels per day, which equates to roughly 47 million gallons. Those totals are up year over year and ahead of the three-year average. Inventories also increased, with higher levels in the Midwest but still below historical trends. Exports have cooled in recent weeks, but numbers show overseas shipments remain strong.
We are also less than a week away from the first WASDE report of 2026, which is expected to show significant amounts of grain on hand. We should have a better idea of just how many supplies we have on hand on Monday. The USDA will release the January WASDE report at Noon ET, with full coverage on Market Day Report.
And while much of it will be in storage, crop scientist John Mays warns that quality —and your wallet—could take a hit.
“Even after 30 days, growers can see a 2.2 percent loss, which equates to real money,” Mays said. “We’re talking about 10 cents a bushel. For longer storage time, say over 60 days, we’ve seen tests that start at 14 cents and go up from there as a per-bushel loss. And it’s real money we’re talking about. And growers used to think that, ‘Oh, I deliver my grain soon enough, I won’t have a problem.’ But really, what we’ve seen in our trial work is that if you store grain for any amount of time, it can be severely damaged by bugs.”
Lewis Williamson with HTS Commodities joined us on Tuesday’s Market Day Report with his perspective. In his interview with RFD-TV News, Williamson outlined his expectations for the upcoming WASDE report and provided updates on domestic grain movement and crop production in South America, insights on the forthcoming USMCA review, and other markets to watch in the year ahead.
Supply Chain Uncertainty Fuels Grain Choices
Mike Steenhoek with the Soy Transportation Coalition said uncertainty was a major factor last year and that trend will likely persist.
“Large industries like agriculture and supply chains that serve industries like agriculture, they don’t like uncertainty, and there has been a considerable amount of that,” Steenhoek said. “Of course, when it comes to things like export markets, and things like origin of manufacturing for ship building, and whether we’re going to penalize ships being built in China or not. There’s a lot of that uncertainty that really had an impact on supply chains.”
Steenhoek said river transportation was difficult last year, particularly on the Mississippi River. He says rail service was the clear winner, helping tame some of that uncertainty. “Rail service was pretty commendable throughout the course of the year, and so that certainly has been beneficial to us also,” Steenhoek continued. “You know, when you’ve got all this uncertainty, when it comes to our export markets, what you want is for your supply chain to not be adding insult to injury. You want it to be operating as efficiently as possible, because you don’t want one more cost being added to the overall transaction. And so, you obviously celebrate those occasions where the supply chain is operating well. But then, when you have issues like those on the Mississippi River, you know it’s obviously an area for concern.”
U.S. rail systems made big headlines last year with the proposed merger between Union Pacific, which is seeking to acquire Norfolk Southern. This deal would create the nation’s first transcontinental railroad. In his recent interview with RFD-TV News, Steenhoek also provided an update on the latest developments and what farmers and ranchers can expect as the process progresses.
While the proposal is still awaiting approval from the Surface Transportation Board (STB), ag groups are watching closely, saying the deal could significantly affect how crops and livestock reach markets. Some shippers believe a single rail line would provide even greater access to domestic and export destinations. On the other hand, Steenhoek said, other shippers are cautious about the deal. Pointing to past rail mergers, they have concerns surrounding competition issues and service disruptions.
“I’m hearing both,” he said. “I’m hearing from agricultural shippers, those who actually are quite supportive of the proposed merger between Union Pacific and Norfolk Southern, and they point to the fact that you’re going to likely have more steam or service from one area of the country to the next. So, you’ll have an agricultural shipper that has a collection of facilities that are west of the Mississippi River. They would like to have greater access to maybe some of the livestock markets in the southeast part of the United States, or to the east coast for the ports over there, say, if there are problems at West Coast ports or markets in the west, so you have this prospect for more seamless service.”
However, the STB will ultimately decide whether or not the deal moves forward.
