Traders who were expecting fireworks from the June USDA report, released Thursday, were met instead with what Susan Stroud called a “ho-hum” release. Stroud, founder and CEO of NoBullAg based at St. Louis, Missouri, joined RealAg Radio's host Shaun Haney to break down the report’s limited impact and explain why biofuel policy, not supply numbers, has markets on edge.
“The market was expecting an increase in corn exports for old crop, and we did get that, a 50 million bushel bump,” Stroud says. That change brought old crop ending stocks down to 1.365 billion bushels and flowed into new crop numbers. But overall, the data landed within expectations, and markets barely reacted, she says.
Instead, market attention has shifted sharply toward rumours around the U.S. Renewable Volume Obligations (RVOs) for 2026 and 2027. The policy dictates biofuel blending requirements and has significant implications for soybean oil, which Stroud says is “very policy driven.” Nearly half of U.S. domestic demand for soybean oil comes from biofuels, making it highly reactive to changes in federal mandates.
“The industry was looking for 5.25 [billion gallons], but the rumours today suggest taking the under,” she notes, adding that such signals have weighed heavily on the soybean complex. Read more here.
Canola, by contrast, could benefit from proposed tax credit changes tied to North American feedstock sourcing. “That’s probably some of the reason we’ve also seen some strength in the canola market,” says Stroud.
Looking ahead, attention will pivot to the June 30 acreage report, though "benign weather" and strong South American crops continue to cap upside potential in corn and wheat, she says. “The path of least resistance is lower,” she adds, particularly with “garden-like” growing conditions in much of the U.S. Midwest.
Stroud emphasizes the importance of watching for final RVO numbers later this week and ongoing legislative shifts that could shape both feedstock eligibility and tax credits under section 45Z.
