Corn tests two centuries of US-Mexico relations

Reliable demand forecasts for ethanol uptake in the EU are made harder by the piecemeal implementation of fuel standards across the bloc, an official at European renewable ethanol producers' group ePURE said in an interview. E10 gasoline contains up to 10% renewable ethanol and is the standard gasoline fuel on offer across a range of service stations in a growing number of European countries. It picks up the baton from E5 and in many cases is slated to give way to E20 but although momentum is mounting for E10, with Poland recently announcing it will mandate E10, there are notable gaps in the picture. Spain and Italy do not have yet E10 available at pump level and these represent significant gaps, David Carpintero, director general of ePURE told S&P Global Commodity Insights in an interview June 5: "I think one of the issues for an ethanol demand outlook is when will Spain and Italy finally complete the implementation of E10. It's long overdue," he said. Producers and fuel blenders are already turning their sights to E20 and there is a risk that those not yet up to speed will be unable to catch up as E5 and in time E10 become obsolete, he said. "E20 will provide a strong tool for member states to comply with the new Fit-for-55 targets for 2030 to de-fossilize road transport," Carpintero said. There is traction in ethanol take-up. The Polish government aims to make E10 the standard fuel at the pump starting in 2024, replacing E5. In 2022, Poland's ethanol production increased 21% year on year, with corn oil the main feedstock. The introduction of E10 would add another 200,000 cu m to annual ethanol demand, according to the Polish biofuel chamber, or KIB. With fuel ethanol demand expected to rise in the future, crude oil refiner and biofuels producer PKN Orlen is set to bring forward investment into its fuel ethanol blending capacity by two years, with a view to producing E10 from January 2024. Other European countries are adopting the E10 fuel standard too. The Republic of Ireland rolled out the E10 fuel grade in April. Austria plans to introduce E10 in September, having recently created the regulatory requirements for its imminent launch upon the market. Global fuel ethanol production totaled 1.839 million b/d in 2022 and will rise to 1.962 million b/d in 2024, analysts at S&P Global said June 2. In Europe, production was 94,000 b/d in 2022 and this will rise to 103,000 b/d in 2024, the analysts said. Price concerns There were significant upswings in price following Russia's invasion of Ukraine in February 2022 and the resulting international sanctions. These affected flows to Europe of both conventional fuels such as gasoline and diesel, of which Russia was traditionally a key exporter, and feedstock for renewable fuels from the Black Sea. Fuel Ethanol T2 FOB at Rotterdam was Eur552/cu ($590/cu m) in March 2021; in March the following year, directly after the invasion, it was Eur1,143/cu m, according to S&P Global data. Since then, trade flows have reconfigured themselves and initial alarm about supply of fuel products has diminished. In May, Europe Fuel Ethanol T2 FOB was Eur753/cu m and analysts at S&P Global forecast it will be Eur764/cu m in November. May's level was the lowest in 2023 but the start of the summer driving season should provide a price floor, S&P Global analysts said. Crop-based fuels in the firing line There has been a growing chorus from lobby groups and lawmakers for biofuels to be produced from non-crop-based feedstocks, but from so-called advanced feedstocks, derived from residue. Through updates to its Renewable Energy Directive, the EU has not phased out crop-based fuels but has capped their content at 2020 levels plus 1%, with a maximum of 7%. European Waste-based & Advanced Biofuels Association (EWABA) secretary-general Angel Alvarez Albardi told S&P Global in April that while his group represents advanced feedstocks it still feels the need for crop-based biofuels in the mix. Carpintero echoed this, adding that the best way to manufacture advanced feedstocks is via production routes for crop-based fuels. "The best efficiency is when advanced [feedstocks derived fuel is linked to the existing biorefineries," Carpintero said, adding that there are 50 biorefineries in Europe. Production is currently set up along these lines in any case. At present, feedstocks in Annex IX A, the EU's list of approved advanced biofuels feedstocks, tend to be waste products from crops.

Australia, one of the world's leading wheat exporters, has produced three bumper wheat harvests in a row, and with the prospect of an extension of the Black Sea grain corridor deal fading by the day, the country is emerging as a reliable wheat supplier to Asian markets. In this episode of the Commodities Focus podcast, S&P Global Commodity Insights agriculture news senior editor Asim Anand discusses the outlook for Australian wheat with associate editor Vivien Tang, senior pricing specialist Nikolaos Aidinis Antonopoulos and editor Sampad Nandy. The panel considers whether Australian wheat has an edge over its competitors and supply prospects for the upcoming marketing year, as well as diving into the ambiguity surrounding the Black Sea grain trade deal and the impact s on the Asian market if the deal is not renewed on May 18. Related Platts price assessments: Ukraine Wheat 11.5% FOB Black Sea WAUSA00 - APW Wheat FOB Australia $/mt More listening options: No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).

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The EU reached a deal March 30 to almost double the share of renewables in the 27-nation bloc's energy consumption to 42.5% by 2030 as part of its Renewable Energy Directives or RED III. To fulfill these ambitious new targets without diverting food crops into fuel tanks, the EU's transport sector is investing more in non-food-based advanced biofuels. S&P Global Commodity Insights speaks to the Brussels-based European Waste-based & Advanced Biofuels Association (EWABA) Secretary-General Angel Alvarez Alberdi on how companies and legislators are adjusting to shifting policy targets in times of rising compliance costs and energy insecurity. With the adoption of RED III what kind of broad shift in feedstock use are you expecting? Who will be the big gainers and losers? RED III is putting forward a new greenhouse gas reduction target for the transport sector. This method, which was being implemented solely by Germany, would still give a premium to the biofuels with the highest emission savings potential. And, indeed, in this context waste-based and advanced biofuels have the highest savings. The [March 30] deal allows member states to continue with energy content targets for as long as the GHG target is also met. The deal also allows double counting for Annex 9 biofuels -- that is a very good promotion mechanism for waste-based and advanced biodiesel. At the end of the day, whether the member state stays with the energy content plan or migrates to the new GHG system, I am confident that advanced feedstocks are the best performing in both scenarios. How will the new directive affect used cooking oil and tallow demand? There is a big demand for these commodities because they are extremely good feedstocks and the final product is particularly good in terms of circularity, sustainability and GHG savings. They have been promoted by the legislators, which reinforces their value. Now there is a very ambitious proposal for revision of the Annex and this could see at least 17 new feedstocks populating Part B including some that are promising in volume and general characteristics. For example, damaged crops, brown grease which has been in there before because some member states have been interpreting that it was in part A. Some intermediate crops like Camelina, Carinata and even rapeseed are being considered as promising feedstocks -- but with very strong conditionality. This is fundamental. Not any crop can play this role. It should be a second harvest on a land that already has had a first harvest on a single given year and under no circumstance should there be use of any additional land because that will result in ILUC [Indirect Land Use Change]. AT A GLANCE Annex IX: EU's advanced biofuel feedstocks Under the EU's biofuels policy, emphasis has been laid on insulating food supplies from ending up as raw material for transport fuels. Hence, the EU's renewable energy directive legislation classifies biofuels by the feedstock used and biofuels made from waste products and agricultural byproducts have been incentivized by double counting and are known as advanced feedstocks or second generation feedstocks. The list of feedstocks which would qualify as advanced biofuels are given in Annex IX in the RED II legislation, which came into force in 2021. Part A of Annex IX contains feedstocks such as algae cultivated in ponds and bioreactors, household waste, straw, animal manure, palm oil mill effluent, wastes from forestry and other non-food cellulosic material. Part B currently lists only used cooking oil and animal tallow as feedstocks. Currently, a larger portion of biofuels is produced using waste oils and fats listed in Part B of Annex IX of the RED II. Nearly 30% of EU's biodiesels are produced from used cooking oil and animal fats, according to a US Department of Agriculture report in 2022. According to RED III targets agreed on by member states in March, the contribution of advanced biofuels and biogas produced from the feedstock listed in Part A of Annex IX as a share of final consumption of energy in the transport sector shall be at least 0.2 % in 2022, 1 % in 2025 and at least 3.5 % in 2030. What kind of timeline are policy makers looking at for this revision of Annex 9? This should happen this year. There is already a draft in front of the [European] Commission that was followed by a public consultation in late December 2022, and now the commission is assessing the responses. There is a group of experts from member states assessing the proposed revision and we could have the revision as soon as late second quarter or more realistically the third quarter of this year. How will policy and integration of more advanced feedstocks change EU's demand for traditional crop-based biofuels? With all the pieces of legislation and the demand for diesel, I think FAME [fatty-acid methyl ester] will continue to play a major role. It's true that due to stricter carbon dioxide standards for cars there will be a smaller demand for diesel vehicles after 2035. But I am sure that higher blends up to B30 and beyond in the heavy-duty segment will ensure that there will be a higher demand for FAME biodiesel. Also, you have to take into consideration the EU fuel regulations in maritime decarbonization is mandating three-year targets for GHG reduction. Currently, the best available product available for maritime decarbonization already being supplied to the maritime sector is waste-based and advanced biodiesel. So, this will ensure that we will continue seeing biodiesel at the very top. Right now, the reality is that RED III rules have not phased out crop-based biofuels, but they have capped it at 2020 levels plus 1% with maximum limit of 7%. So as far as I'm concerned, they do have a role to play. We [EWABA] represent advanced feedstocks and we still want to see and need conventional biofuels in the fuel mix. Many of the major member states have announced accelerated shifts to advanced biofuels from crop-based biofuels. What is broader sentiment across the EU and how much will the cost of compliance increase? Yes, cost of compliance is a factor for feedstock price. There is a number of promising feedstocks that require more processing, refining and face purity issues, impacting compliance costs, but a constant stream of investment is coming to the industry, so the future looks bright. Six of our members have invested about three quarters of a billion euros last year on this matter. This gives an indication of what is needed to be done. We have never seen a deal in which all legislation is up for grabs with revision of Annex 9. Paradoxically this is going to be constant in the future because all the pieces being agreed now have revision clauses. It means that in 2026-27 they're going to be renegotiated again with the annex being revised every two years. Given the scope for revision and renegotiation on the current policy, is it supportive to build a long-term economy of scale for the industry? Despite the regulative uncertainty there is lot investment pouring in constantly. Oil majors have clear will to decarbonize and invest in low carbon fuels. These corporates have been in business for two decades. Despite the uncertainty there are new announcements almost every month, so the industry has set a future: that despite the regulatory uncertainty, energy security is the overarching requirement.

Comments are due later this month on the Environmental Protection Agency’s proposal to grant a fuel policy shift that would clear a path for eight Midwest states to offer a gasoline blend containing 15% ethanol year-round. While ethanol producers were furious that the proposed policy change wouldn’t go into effect in time for this summer, some oil refiners insist even the 2024 planned implementation date is too soon. American Fuel & Petrochemical Manufacturers Senior Director of Fuel and Vehicle Policy Patrick Kelly joined the podcast to lay out challenges the group sees with this call for a new Midwest gasoline blend. He also provided his take on calls for emergency waivers and legislation to address the provision of E15. Stick around after the interview for Binish Azhar with the Market Minute, a look at near-term oil market drivers. Related content: Retailers push EPA for emergency waiver to avoid US summertime E15 sales ban (premium content) US EPA poised to lift E15 sales restrictions in the Midwest, but not until 2024 Podcast: Hello summer. Goodbye Midwest E15 sales restrictions -- but not until 2024 Fight to lift US E15 sales restrictions creates strange bedfellows among oil, biofuel groups No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).

Comments are due later this month on the Environmental Protection Agency’s proposal to grant a fuel policy shift that would clear a path for eight Midwest states to offer a gasoline blend containing 15% ethanol year-round. While ethanol producers were furious that the proposed policy change wouldn’t go into effect in time for this summer, some oil refiners insist even the 2024 planned implementation date is too soon. American Fuel & Petrochemical Manufacturers Senior Director of Fuel and Vehicle Policy Patrick Kelly joined the podcast to lay out challenges the group sees with this call for a new Midwest gasoline blend. He also provided his take on calls for emergency waivers and legislation to address the provision of E15. Stick around after the interview for Binish Azhar with the Market Minute, a look at near-term oil market drivers. Related content: Retailers push EPA for emergency waiver to avoid US summertime E15 sales ban (premium content) US EPA poised to lift E15 sales restrictions in the Midwest, but not until 2024 Podcast: Hello summer. Goodbye Midwest E15 sales restrictions -- but not until 2024 Fight to lift US E15 sales restrictions creates strange bedfellows among oil, biofuel groups No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).

The Biden administration is working to reduce US aviation emissions by 20% by 2030 and achieve net-zero emissions for the sector by 2050. To meet this goal, the administration launched the Sustainable Aviation Fuel Grand Challenge to catalyze the production of at least 3 billion gallons of sustainable aviation fuel (SAF) per year by 2030 and 35 billion gallons per year of SAF by 2050. Gevo is currently the third largest worldwide supplier of SAF and has committed to delivering 1 billion gallons per year of SAF and other renewable fuels by 2030. Gevo CEO Patrick Gruber joined the podcast to discuss the policies and market dynamics needed for the significant boost in SAF production envisioned by the administration. He also addressed pain points to deploying SAF projects and sought to debunk some false narratives surrounding the SAF industry. Stick around after the interview for Starr Spencer with the Market Minute, a look at near-term oil market drivers. Related content: United Airlines launches $100 million fund to support SAF startups (premium content) US' Gevo inks deal to develop Net-Zero 1 low-carbon SAF site in South Dakota Biden administration unveils roadmap to clean up emissions from air travel More listening options: No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).

The EU’s Carbon Border Adjustment Mechanism is set to have far-reaching impacts on world trade and the wider energy transition. Phasing in from 2026, CBAM will levy a carbon tax on imports of selected energy intensive materials and products into the EU, removing the gap between the EU’s ETS carbon price and the export country of origin’s carbon price. Analysis by S&P Global Commodity Insights shows Canada, Brazil, South Africa and Turkey will be most exposed to the mechanism, with iron and steel by far the biggest sector targeted. Click to see the full-size infographic Related Insight Blog entry: CBAM, ETS reform to impact fertilizer trade Related podcast: How will the EU's Carbon Border Adjustment Mechanism affect global trade and carbon pricing? More listening options:

Corporate interest in reducing and offsetting greenhouse gas emissions has grown substantially in the past decade. With more than one-third of the world's largest publicly traded companies now committed to net-zero goals, according to the Net Zero Tracker, carbon credit offsets have been touted as a way for the private sector to reach its decarbonization targets. One nature-based offset, soil carbon credit, has begun to gain traction particularly in the US and Australia, yet several challenges impede the take-off of such projects globally. Opportunities The intersection of voluntary carbon markets and agriculture has become increasingly important in the face of global climate change. The agriculture industry contributes significantly to GHG emissions, yet there are numerous opportunities for the implementation of agricultural practices that reduce, avoid, or remove emissions from the sector. Carbon is sequestered by plants during the process of photosynthesis. As plants photosynthesize, carbon dioxide is pulled out of the atmosphere and eventually stored below ground within soil organic matter. Soil organic matter is created through the decomposition of plants, the breakdown of animal waste, and through various processes involving soil microorganisms. Land management practices greatly influence the amount of carbon sequestered in soil. Practices that increase the amount of soil carbon stored include reduced or no tillage, prevention of overgrazing, reduction or increased precision of fertilizer application, and the maintenance of ground cover through cover cropping. According to Australia's Commonwealth Scientific and Industrial Research Organization, nature-based carbon sequestration projects, including soil carbon projects, represent the most cost-effective methods of storing carbon. Apart from being a cost-effective tool for reducing emissions from the agriculture sector, soil carbon projects also represent a long-term investment and source of income for farmers. As most farmers live season to season and often work off-farm jobs to get by, so-called "carbon farming" presents an opportunity to reward farmers for switching to more regenerative agricultural practices. For example, farmers in the US can earn up to $30/acre/year from participating in soil carbon projects, according to US-based project developer Indigo Ag's website. Public policy Countries such as the US and Australia have begun incorporating soil carbon sequestration into climate mitigation plans and policies, creating an opportunity for soil carbon projects to grow in popularity. In the US, President Joe Biden has pushed soil carbon sequestration as an important component of climate mitigation, suggesting in his first address before Congress in April 2021 that farmers should be getting paid for growing cover crops. In June 2021, the Senate overwhelmingly voted to pass the Growing Climate Solutions Act, a bill that would make it easier for farmers to participate in voluntary carbon markets. The bill sat stagnant in the House of Representatives until recently when it was included in the omnibus spending bill passed on Dec. 23. The legislation is set to reduce barriers of entry for the voluntary carbon market by establishing a US Department of Agriculture certification program for third-party verifiers and providing technical assistance on generating and selling carbon credits. Agriculture Secretary Tom Vilsack has suggested that one long-term solution for promoting the development of carbon markets in the US is through the Commodity Credit Corporation, which could act as a carbon bank. In Australia, the storage of carbon dioxide in soil is one of the major goals of the government's Technology Investment Roadmap, which represents an important part of the country's long-term emissions reduction plan. Under the country's Emissions Reduction Fund scheme, project developers can participate in the compliance-based market by following various established methodologies, such as for soil carbon sequestration, to generate Australian Carbon Credit Units, or ACCUs. There are 433 soil carbon projects registered under the ERF as of Feb. 13, according to a spokesperson from Australia's Clean Energy Regulator. Challenges "There's no getting around the complexity of agriculture mixed with the complexity of the carbon market," Max DuBuisson, head of sustainability policy and engagement at Indigo Ag, said in an interview with S&P Commodity Insights earlier this year. The viability of carbon farming as a value-add for farmers is limited by several factors, such as the upfront costs of soil sampling and project registration, the opportunity cost of changing practices, potential near-term reduction in yields and the market price of nature-based carbon credits. The complexity and differences between the various standards for soil carbon quantification presents another challenge for farmers due to the potential variability in the quality of credits produced and thus the marketability of those credits. Permanence and additionality are also contentious issues when discussing soil carbon projects. The additionality of projects, or showing that the changes in carbon stocks wouldn't have occurred without the financial incentive of credit generation, limits participation in the carbon market to farmers that have not yet adopted sustainable practices. For example, farmers that already sow cover crops in their rotations would not be able to benefit from participating in the carbon market. The permanence of storing carbon presents a challenge for the take-off of soil carbon projects as the length of carbon storage in soil varies based on the biological, chemical, and physical properties of soil. Additionally, as almost half of all farmlands in the US are rented according to the USDA, changes in land ownership or management could result in a reversal in carbon storage. Furthermore, up to tens of thousands of acres are needed to enable feasible, cost-effective credit generation, DuBuisson said, adding that this imperative for scale to make the numbers work has likely held the market back. "You really need larger projects to make it work." The aggregation of fields to generate credits is the most common way to address the issue of scale as this reduces the upfront financial burden of sampling each field. Project developers in the US and Australia have taken an aggregation approach by taking a subset of soil samples from different farms to determine baseline carbon stocks and then using models or remeasurement to determine changes in carbon stocks under the project scenario. Pricing Currently, carbon prices are too low for soil carbon projects to be profitable unless done on a massive scale or unless they attract a major premium for the credits generated. For reference, Platts, a part of S&P Global, assessed CRC current year, which reflects the most competitive price for nature-based and technology-based removal credits , at $12.30/mtCO2e on Feb. 21. "Today a soil carbon project needs to be delivered at scale and requires a carbon price of $30+ to be viable," Louise Edmonds, CEO and founder of Carbon Sync, an Australia-based project developer, told S&P Global via email on Jan. 30. Under the Carbon by Indigo program, Indigo Ag sold credits generated at $20/credit when the program first launched. It has since increased with a wave of contracts sold at $27 and $40/credit. With farmers receiving 75% of the revenue from credits sold, farmers participating in the Carbon by Indigo program may receive up to $30/credit generated. "We tend to be selling out well ahead of the sort of market average prices," DuBuisson said. With the average acre generating around 0.2 credits/year, "we do you need that price to be even higher, to make this a really, really valuable sort of addition to the farmer's business," DuBuisson added. For context, a 1,000-acre farm would generate around 200 credits/year on average, and if valued at $40/credit, the farmer would earn only about $6,000/year of additional income for conducting a soil carbon project. With the return on investment fairly low and possible short-term decreases in yield from adopting regenerative practices, the price of soil carbon credits would have to rise substantially, or additional incentives would need to be implemented, for farmers to participate in the carbon market on a larger scale.

Platts, part of S&P Global Commodity Insights, Feb. 20 launched daily assessments for crop feedstock biomethane guarantees of origin (GOs) in the UK, and for manure feedstock biomethane GOs in Denmark and the Netherlands. The new daily assessments are for current-year and year-ahead vintages for both the UK crop and Denmark/Netherlands manure assessments, with a minimum trade volume for assessment of 1 GWh. They include carbon intensity (CI) value definitions for crop and manure. The CI value definition range for the UK crop biomethane GO assessments is for certificates with an associated CI value of higher than 25.00 g Co2e/MJ with no maximum. Platts understands that biomethane of significantly higher carbon intensity do not receive GOs. For manure biomethane GO assessments in Denmark and the Netherlands, the CI definition is for values lower than minus 85.00 g Co2e/MJ. Existing assessments for European biomethane GOs, with CI from 25.00 to 0 g CO2e/MJ, are relabeled as waste. The UK crop assessments are punished in GBP/MWh and Eur/MWh, while the Denmark and Netherlands manure assessments are published in Eur/MWh. The assessments are published at a 4:30 pm London timestamp. Platts invites all questions and feedback to Platts_Carbon@spglobal.com, power@spglobal.com and pricegroup@spglobal.com. For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request. The Platts European Biomethane GO assessments are available through the following channels: European Gas Daily Platts Market Data category EBM Platts Dimensions Pro Fixed Pages PGN0876, PEP1107, LNG0841

Platts, part of S&P Global Commodity Insights, has decided to launch a new daily assessment for Parboiled Rice 5% STX on a CFR West Africa basis, effective Feb. 20. Platts decided to launch a CFR West Africa parboiled rice assessment Jan. 9, following a period of consultation: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/010923-platts-to-launch-parboiled-rice-5-stx-cfr-west-africa-assessment Platts first proposed to launch a CFR West Africa parboiled rice assessment Dec. 14, 2022, available here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/121422-platts-proposes-to-launch-parboiled-rice-5-stx-cfr-west-africa-assessment The assessment is the first delivered rice assessment by a price reporting agency and results from the increasing need for transparent rice pricing information in destination markets. The assessment reflects prices of parboiled rice that meet the required physical specifications, from any global origin. Assessment Long Grain Parboiled Milled Rice 5% STX CFR West Africa Frequency Daily Bates Close Timestamp 4:30 pm UK time Unit of measurement $/mt Incoterm CFR Destination Cotonou, Benin Arrival at disport 60-90 days from date of assessment Shipment Breakbulk Cargo size 1,000-10,000 mt, normalized to 5,000 mt Packaging 50kg PP bags Max. broken kernels 5% Min. average grain length 5.7mm Max. moisture 14% Max. damaged/discolored 2% Max. red/red streaked 0.25% Max. black/black tip 0.25% Max. foreign matter 0.25% Min. Milling degree Well milled, STX quality All other specifications and clauses should be as per market practice. Delivered prices to other West African ports may be considered in the assessment. Normalization for quality, dimensions, cargo size, packaging, payment terms will reflect current differentials applied in the market, and locational normalization may make use of freight netbacks and freight forwards. Please send all comments, feedback and questions to europe_ags@spglobal.com and pricegroup@spglobal.com. For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request.

Indonesia's state-owned livestock farming company, Berdikari, has requested the Indonesian Feedmills Association GPMT to submit the required imported feed wheat demand from its members amid rising raw material costs in the form of domestic corn and imported soybean meal prices. Berdikari has sought Indonesian feed millers' imported feed wheat demand to be submitted by Feb. 17, where the latter will be obliged to purchase the required feed wheat at a price of Rupiah 5,775/kg (38 cents/kg), in a letter dated Feb. 16 seen by S&P Global Commodity Insights. Berdikari intends to buy Australian feed wheat with Standard Feed Wheat specifications for May-June shipments to Cigading and Surabaya if they can gather enough interest. Feed wheat could be imported through Berdikari, according to Indonesian buyers. But feed millers believe that feed wheat at that price, before adding the associated cost, continues to remain expensive while noting that the cargo will only arrive from June 2023 onward, whereas the outlook on domestic corn prices remains unclear. A similar request was submitted to GPMT Feb. 10, where Berdikari requested members to consolidate demand to import milling grade wheat from Ukraine, Bulgaria or Australia with an obligation to purchase between Rupiah 6,200-6,575/kg. The request was unable to garner sufficient interest, according to sources. Platts assessed Australian Standard White Wheat FOB Australia at $315/mt Feb. 16, according to S&P Global Commodity Insights data. Domestic corn prices have been soaring in the past weeks. Domestic corn was heard to be offered at Rupiah 5,700/kg Feb. 17, gaining more than 10% since Jan. 30 when it was offered at Rupiah 5,150/kg, S&P Global's records show. These prices pale in comparison against prices between September-December 2022, when local corn prices reached a low of Rupiah 4,200-4,300/kg and an export program was started to support the rapidly falling corn prices. As a result, more than 200,000 mt of Indonesian corn was exported to neighboring destination markets of Vietnam, the Philippines and Malaysia, S&P Global previously reported. "Corn prices started picking up as farmers felt no incentives to plant corn at the low prices and switched a large amount of planting area to cassava crops which is easier and cheaper to plant as they need less fertilizers. Higher corn price is also a result from higher input costs for seeds and fertilizers, and some unfavorable weather in the past weeks during harvest," a trader said. Some of the feed millers had anticipated a spike in domestic corn prices. But in February 2022, carried-over feed wheat stock from 2021 made the high corn prices manageable. High corn prices add to the already-high cost of feed production on the back of rising soybean meal prices imported from South America. However, weaker futures and a weaker undertone on soybean meal premiums over the week ended Feb. 17 provided some relief for the buyers. CFR Indonesia (2 ports) soybean meal indications were heard in the low- to mid-$60s/st over May (K) and July (N) futures for April-July shipments on Feb. 17. "Corn and soybean meal are both very expensive now, it is going to squeeze poultry farmers. Some of them have already started reducing their feed rations to save cost," an Indonesian trader said. Platts assessed Corn CFR North East Asia at $338/mt Feb. 16, according to S&P Global data.

Vietnam, facing depressed hog margins, is likely to defer corn purchases until Brazil starts harvesting its Safrinha crop, traders and industry sources told S&P Global Commodity Insights, especially given the currently backwardated feed corn market and high prices for soybean meal. Corn cargoes on CFR Vietnam basis for shipment over March-May were offered between $344-$346/mt CFR Feb. 7. The forward curve for corn prices slopes downward with June shipment indicated at $331-$332/mt CFR while shipments over July-November, when Brazil's Safrinha crop reaches the market, were at $314-$317/mt CFR, according to market sources. Platts assessed Corn CFR Northeast Asia at $338.25/mt Feb. 7, showed S&P Global data. Buyers are likely to defer any demand to later shipments amid the backwardation in the physical corn market to Asia and weak margins in the livestock sector, said Vietnam-based sources. "We will look for cheaper corn from the region to fill up any shortfall in the next quarter or use existing stocks," a buyer said. Hog prices in Vietnam have been declining after hitting a one-year high of VND 68,000-72,000/kg ($2.90-$3.07/kg) in July 2022, with prices at the end of January at VND 51,500-52,500/kg ($2.20-$2.24/kg), Vietnam-based industry sources said. "Hog raising margins are currently in negative territory with live hogs prices at this level," said a local trader. The surge in hog supply for the Lunar New Year season led to lower prices and there is still ample availability in the market, which is expected to keep a lid on prices in the short term, market sources added. The sector also faces challenges from rising input costs for feed and feed raw materials. Corn and soybean production in Argentina have been continuously revised down in the current marketing year amid severe drought, which led to bullish basis prices and Chicago Board of Trade futures for corn and soybean meal. Vietnam reduced corn imports for a second consecutive year in 2022 amid high prices, with local feed market participants using carry-out for feed production. Domestic carry-out fell 26% on the year to 1.10 million mt in 2022, according to industry estimates while swine feed production grew 8% to 16.4 million mt. Cheaper corn continued to be offered from India and Pakistan with buyers quoted $330/mt CFR for prompt shipment, while there was also an offer for Russian corn for March shipment at $335/mt CFR. "At these levels, there will be buyers, everyone is looking for cheap corn. However, the issue is on how the payment is made, not many buyers can execute this trade," a Vietnamese broker said. Feed buyers also said that the prices of alternatives to corn such as feed wheat and barley were looking increasingly favorable for Q2 and early Q3, incentivizing substitution of feed grains in feed formulation. Indonesian corn not an option Indonesia had exported over 200,000 mt of corn over September-November 2022 to regional markets in the Philippines, Vietnam and Malaysia after weak local demand and falling domestic corn prices, S&P Global reported earlier. Domestic corn prices were around Rupiah 4,000/kg DAP Jakarta when these exports were made. However, an uptick in demand in preparation of festivities, higher production costs amid expensive seeds and fertilizers, and crop switching to planting lower maintenance cassava crops reduced supply and supported domestic corn prices. Domestic corn prices recovered to about Rupiah 5,150-5,300/kg DAP ($340-$349/mt) at the end of January, sources said. High soybean meal prices Prices of South American soybean meal to Vietnam and other Southeast Asian destinations have continued to rise on the back of strengthening Chicago Board of Trade futures following continued concerns over Argentina's dry weather and soybean production. The higher soybean meal price is expected to temper growth in the feed and livestock sector in the near term. Soybean meal was indicated at a basis price of $67.5/st over the CBOT futures for the April-July shipment window, corresponding to a flat price of $595/mt. March shipments were priced at $81/st over March futures, or $633/mt, Feb. 7. However, buying indications for soybean meal for deferred shipments remain in the low $60s/st over CBOT futures. High soybean meal prices have incentivized Asian buyers to source cheaper alternatives. In January, South Korean feed buyers bought 19,000 mt of soybean meal of Chinese origin and 40,000 mt of rapeseed meal of Indian origin to offset the rising cost of South American soybean meal, market sources said. Indonesian feed buyers have recently started considering purchasing Indian soybean meal while Vietnamese buyers have continued to buy soybean meal from India, said sources.

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Platts, part of S&P Global Commodity Insights, will launch daily assessments for crop feedstock biomethane guarantees of origin (GOs) in the UK, and for manure feedstock biomethane GOs in Denmark and the Netherlands. The new daily assessments are for the current-year and year-ahead vintages for both the UK crop and Denmark/Netherlands manure assessments, with a minimum trade volume for assessment of 1 GWh. They also include carbon intensity (CI) value definitions for crop and manure. The CI value definition range for the UK crop biomethane GO assessments is for certificates with an associated CI value of higher than 25.00 g Co2e/MJ with no maximum. Platts understands that biomethane of significantly higher carbon intensity do not receive GOs. For manure biomethane GO assessments in Denmark and the Netherlands, the CI definition is for values lower than minus 85.00 g Co2e/MJ. Existing assessments for European biomethane GOs, with CI from 25.00 g to 0 g CO2e/MJ, will be relabeled as waste. The UK crop assessments will be published in GBP/MWh and Eur/MWh, while the Denmark and Netherlands manure assessments will be published in Eur/MWh. The assessments will be published on a 4:30 pm London timestamp from Feb. 20. Platts invites all questions and feedback to platts_carbon@spglobal.com, power@spglobal.com and pricegroup@spglobal.com. For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request.