China made its largest weekly U.S. beef purchases on record last week, followed by its biggest U.S. corn deals in almost a month this week, according to U.S. Department of Agriculture data released on Thursday.
With a large increase in corn acres, and declining ethanol demand, the U.S. could be swimming in supplies. That’s why one analyst thinks there's downside price risk with putting corn in the ground this year.
Ethanol prices are in a free fall due to fewer people driving and a recent price war. As some ethanol plants shutter production, facilities may start producing for DDGs to meet the possible upcoming Chinese demand.
Gas prices are falling, but few can take advantage of the low prices as “social distancing” and increasingly stringent COVID-19 prevention restrictions keep people off of the roads and ethanol demand could fall.