Apr 01 | Closing Market Report

Todd Gleason: 00:00

From the land grant university in Urbana Champaign, Illinois. This is the closing market reported as the April 2025. I'm extension's Todd Gleason. Coming up, we'll talk about the commodity markets with Naomi Bloem. She's at TotalFarmMarketing.com out of West Bend, Wisconsin.

Todd Gleason: 00:16

A bit later in the program, we'll take a look at the March USDA hogs and pigs report and discuss the 20 to one. That's right. 20 to one hogs to corn ratio and what it might mean or maybe not for the expansion of that industry in the 2025 calendar year. We'll do that with Jason Franken. He's at the University of Missouri.

Todd Gleason: 00:40

And then as we close out our time together, we'll take up the weather forecast too in-depth with Don Day. He's a day weather in Cheyenne, Wyoming, and we'll do all of that on this Tuesday edition of the closing market report from Illinois Public Media. It is public radio for the farming world online on demand anytime you'd like to listen at willag.org where we're celebrating forty years of this program and some 10,000 episodes.

announcer: 01:09

Todd Gleason services are made available to WILL by University of Illinois Extension.

Todd Gleason: 01:14

May corn today at four sixty one and three quarters, four and a half higher. July up five at four sixty eight and a quarter. December 7 and a half higher at four forty nine and a half. July soybeans, 21 higher at ten forty nine and a quarter. November up 20 at ten thirty nine and a quarter.

Todd Gleason: 01:30

And soft red winter wheat in the July up three and a quarter at five fifty three and three quarters. Naomi Bloom now joins us, from TotalFarmMarketing.com. She's in West Bend, Wisconsin. Hi, Naomi. Thank you for being with us.

Todd Gleason: 01:44

I understand that, you were on the south end of the toughest weather that came through that area. I guess you got a little lucky there. I do wanna turn your attention though rather, to the weather, to yesterday's USDA reports, because there was an awfully big number that came out in this prospective plantings figures. Can you tell me what your reaction was yesterday, and then why you think that the trade in general dismissed it in the corn market pricing?

Naomi Blohm: 02:15

Yeah. So that corn acre number at 95.3, definitely a huge number and over a million above expectations. So, you know, normally, something like that might have sent the market working lower. But because we had been talking about numbers like 95,000,000 acres, 96,000,000 acres for an entire week ahead of that report, the corn market had already been pushing lower prices down, and we were oversold heading into the marketplace. So because the quarterly stocks number came out supportive as expected, that helped to offset a little bit that bigger acres number.

Naomi Blohm: 02:57

But again, mostly it was already priced into the marketplace. I think that was the biggest component of the whole thing. Now, you know, I will add that down the road later this summer, if the weather ends up being just fine, that larger amount of acres and production could weigh on prices come harvest. But for now, we have to get through the growing season, and there are portions of the Eastern Corn Belt that are gonna be receiving eight inches to potentially a foot of rain over the weekend. So that's, zapping the excitement about any hopes of early planting, just taking it totally away.

Naomi Blohm: 03:35

So with the marketplace at this value zone here now waiting for, the next round of tariff news coming out tomorrow afternoon. And, yeah, that old, that USDA report, old news. And now we are looking ahead to the future towards weather potential demand.

Todd Gleason: 03:52

Well, what kind of demand do you think is in the offing given the tariffs that are on the horizons? Will there be reciprocal tariffs that are placed primarily on agricultural products?

Naomi Blohm: 04:06

Well, that is what we're waiting to see tomorrow to see if Canada and Mexico do anything in response. Of course, keeping an eye on China. China has already had a retaliatory tariff towards us, 10% on sorghum, soy, pork, and dairy, 15% on wheat, corn, and cotton. So those values are priced into the market. I'm kinda wondering though with with the world, you know, they everybody's gotta eat.

Naomi Blohm: 04:32

And so right now, we've got tight supplies of, wheat from a global perspective as far as carryout goes. We've got tight supplies of corn from a global perspective. And so the question then would be, can these countries gamble with betting on perfect weather in Brazil, perfect weather in The United States, perfect weather in China going forward? So we'll see what kind of response there is to any tariff news. That definitely, I think, would be something that could weigh on new crop values to see a loss of demand, but time will tell with that.

Naomi Blohm: 05:10

So we gotta keep a tight eye on things.

Todd Gleason: 05:13

We saw that yesterday with the prospective plantings report. In fact, old crop managed to gain. New crop, not really yesterday, so there was some spreading there that was taking place and looking forward to that new crop. So that brings me to the next question is when farmers see those nearby futures markets go higher, it gives them a little bullish push when they probably really should be looking to the December, which went sideways on that particular day. How do you think they should be positioning themselves as it's related to new crop as opposed to the bushels, and we'll call them gambling, that they have in stock still from the old crop?

Naomi Blohm: 06:00

Well, I would say this. With the new crop corn, we're still right on that four fifty area. Four fifty is gonna be short term resistance for now, but if we can get through four fifty, the next upside target is about a dime higher. That's where the forty and fifty day moving averages come together. But if we can get above four fifty this week and finish above four fifty this week, then on a weekly continuous December corn chart, you're gonna have a weekly bullish reversal.

Naomi Blohm: 06:28

Now that doesn't mean $5 corn by any means, but it does mean that the market is gonna be very sensitive to any weather scenarios. And then, that four sixty zone to the high from that we saw back in February, '4 '80, those are, I think, realistic targets based on everything we know right now. So if I'm a farmer thinking ahead about where I should be forward contracting, I'm thinking in my mind I'm watching four sixty futures, and then if we could have a reason to get through four sixty, four 80 would be a tough number to get through, again, barring any major weather events and keeping in mind that there is gonna be potentially here 5,000,000 more acres planted. And barring a major weather event, that's gonna put carry out back over 2,000,000,000 bushels. So think about having some, price targets set with your elevator for maybe a hedge to arrive, and then also be mindful of that window where a lot of times we see our summer high actually between Mother's Day and Father's Day.

Naomi Blohm: 07:25

So May to the June, is a lot of times where we get our one big price push higher and be ready to make those cash sales and then be thinking about protecting unpriced bushels with puts at that time.

Todd Gleason: 07:39

Turn your attention to the soybeans now. What do you see in that marketplace?

Naomi Blohm: 07:43

Well, soybeans kinda waking up here today, a little bit on that weather news. Also, a technical perspective. This morning, the market was able to push through the hundred day moving average, so that triggered some buy stops above the market. And then we pushed through the forty day moving average, and then finally pushed above the fifty day moving average. So a really nice trading day.

Naomi Blohm: 08:05

We are still, in a sense though, range bound from where we've been since the February up till now. And looking just resistance at the ten fifty area. It's gonna take some weather event to get through there and also some happy news on the tariff and trade front to make sure that the demand would still be there for the new crop also. So, we'll keep an eye on that. Seasonally, though, corn and soybeans do have a tendency to work higher throughout the month of April, but then starting in May, things get a little choppy.

Naomi Blohm: 08:41

And, again, be mindful of that summer window to be pulling the trigger on sales between Mother's Day and Father's Day.

Todd Gleason: 08:47

Hey. Thank you much. I appreciate it. It's always a pleasure to talk with you.

Naomi Blohm: 08:51

Yeah. Thanks for having me.

Todd Gleason: 08:52

That's Naomi Bloom. She is with TotalFarmMarketing.com out of West Bend, Wisconsin. Up next, we'll turn to USDA and some of its history. Agricultural research there, and USDA is a stalwart in this area, includes much study and activity occurring in the department's early years at its headquarters on the National Mall in Washington DC. Rod Bain has this report.

Rod Bain: 09:24

Field level research. One of the historical pillars of the US Department of Agriculture. That landscape today includes the many agricultural research stations across the country and supportive research at the various land grant universities through the National Institute of Food and Agriculture. That however is in context a modern development for USDA. Natural Resources Conservation Service historian Shelby Calloway says most of the research activity at USDA in the first one hundred years happened in and around the main buildings in Washington DC.

Rod Bain: 10:04

It began with the original Administration Building located about where the headquarters Witten Building is at now on the National Mall from after the end of the civil war to the start of the twentieth century.

Shelby Calloway: 10:18

Not much was going on here, and so that seemed like a good space where the agricultural department could set up and have a little room for doing experiments and having test plots and things like that.

Rod Bain: 10:26

That original HQ Building was among the grandest and most ornate buildings in the nation's capital according to Callaway, a testament as the unofficial welcome place of the people's department. Yet research was conducted in and around the building, including

Shelby Calloway: 10:44

An enormous glass and iron conservatory type building where they did sort of tropical plant researches, that kind of thing.

Rod Bain: 10:50

As well as Research plots of

Shelby Calloway: 10:53

all sorts of things growing and various experiments and greenhouses and things. All these little outbuildings around what was that original nineteenth century USDA building. Not really out on the mall, but kind of right next to it, kind of all around where the Administration Building is now. There were greenhouses actually on the mall proper from about 1870 to 1940 over about where the Smithsonian American History Museum is now.

Rod Bain: 11:18

Ironically, the original USDA administration building had to wait four years before construction opened again use from congressional approval of the facility in 1864 to 1868 because

Shelby Calloway: 11:34

This little section was also being used as sort of a cattle yard for the Union Army so you had to wait till after the Civil War to build the first building.

Rod Bain: 11:41

The turn of the century also signaled a new era for the agriculture department, one focused on research and one that required new facilities to conduct such study and meet the needs of the growing cabinet level department. I'm Rod Bain reporting for The U. S. Department Of Agriculture in Washington, D. C.

Todd Gleason: 12:01

And I'm University of Illinois Extension's Todd Gleason here on the Urbana Champaign campus of the University of Illinois. You're listening to the closing market report on this Tuesday afternoon. Do visit our website at willag.org, w I l l a g 0 r g, where you can learn something about the research that is happening here on campus from the agricultural economist, the animal scientist, and the crop scientist in our regular feed that comes from them. A blog post from each of those departments posted each and every day here at willag.0rg. And of course, you can always find our programming there as well to listen to on demand and to subscribe to as a podcast.

Todd Gleason: 12:45

It's all at willag.0rg. Now up next, we'll turn to a Missouri ag economist that has written a blog post for the PharmDoc Daily website, which you can see on our website at willag.org right now. It's about the farm gate price of pork and how it could remain strong over the coming year. It should, given the 20 to one hog to corn ratio, believes this ag economist from Missouri, caused producers to expand their operations. But as you'll hear in context, that seems doubtful.

Todd Gleason: 13:27

USDA's March hogs and pigs report held some bullish, albeit mostly modest surprises, writes University of Missouri ag economist Jason Franken on the FarmDoc Daily website. He says most of the USDA stats are smaller than a year ago and below the pre report expectations of unchanged to hire. Andy says the outlook remains positive for hog producers in 2025 with a couple of caveats.

Jason Franken: 13:51

If actual farrowings exceed spring and summer intentions indicated by this report or if potential tariffs hinder export demand, then lower prices may be realized. Conversely, if producers refrain from expansion and domestic and export demand remain strong, then prices could improve.

Todd Gleason: 14:08

The second part is notable and relates to the price of corn. As feed costs are a primary component of hog production, the hog to corn ratio is an historical indicator of profitability. Today, the ratio, which reflects the need for the industry to expand, is about 20 to 1 or $80 hogs and $4 corn. That's just about where we are today, but Franken is not convinced pork producers are in a position to expand just yet.

Jason Franken: 14:36

For the last three quarters of 02/2024, the hog to corn price ratio exceeds 20, which is consistent with Iowa State University economist findings of better than anticipated profits over the last year and is sparking contemplation of herd expansion. However, the hog to corn price ratio just rounds up to 20 for the first quarter of this year with 02/2023 being the worst year on record for hog profitability, more financial healing seems necessary to spur herd expansion.

Todd Gleason: 15:05

This needed financial healing and the uncertain trade landscape may keep hog farmers from taking advantage of the 20 to one ratio. Now if you'd like to learn more from Jason Franken about the hogs and pigs report, look for the article titled March, hogs and pigs report bust experts brackets either on the FarmDoc daily website or at willag.org. It's leading both of those today, but it'll be one down by the time we get to the end of the afternoon. Again, you're searching for Jason Franken, March Madness, hogs and pigs report, bust experts Brackets on the Farm Doc Daily website or at willag.org. Donde is with Day Weather.

Todd Gleason: 16:09

He's in Cheyenne, Wyoming, and now joins us to discuss the growing regions weather here in The United States. Hi, Don. Thank you for being with us. I wanna talk about the growing regions, but things that, are in a space right now where not much is growing because there's still winter weather in parts of the Upper Midwest. I was on the phone with an agricultural economist from South Dakota State in the Northwestern or Northeastern part of that state earlier today.

Todd Gleason: 16:38

A lot of snow on the ground. She called it a winter wonderland still. And then in Wisconsin, I have a friend that is just North of Green Bay, and they were out of electricity because of the ice storms there. Can you give me an idea how widespread this winter weather wonderland runs across the Upper Midwest?

Don Day: 17:00

Yeah. It really runs from the Black Hills Of South Dakota, then across Upper Midwest and into the places that you just mentioned. The wintry weather, actually, you could connect all the way to Upper New York State and into Maine and even along the lee side of the lakes of Lake Erie and Lake Ontario. So it's April, but no fooling. It's April 1, but there's still a lot of winter out there as you just reflected upon.

Don Day: 17:27

And there is gonna be more snow here in the short term over the next forty eight hours across those northern areas, heaviest in Minnesota, the Eastern Dakotas, then going across the Northern Great Lakes. So they're gonna get more now there's some areas like Eastern North Dakota, parts of Western Minnesota, Northeastern South Dakota that are gonna really benefit from this winter weather because a lot of lot of water in that snow.

Todd Gleason: 17:55

Alright. So speaking of water, we're going to get rainfall in how much of the Midwest?

Don Day: 18:00

Well, now, yeah, now we're gonna shift gears because it's not gonna be snow, but it's gonna be rain that's going to be forming with kind of a confluence of events. We're going to see a storm system come across the Southern Rockies and go very slowly across the Southern Plains this weekend and into early next week and really kind of get started here as we get to the second half of this week with a persistent chance of rain and it's going to extend from East Texas and Eastern Oklahoma on a Northeast path with some very heavy rain from those areas through Arkansas, a good part of Central And Southern Missouri, then Southern Indiana, Southern Illinois, Southern Ohio and a good chunk of Kentucky and Tennessee. I mean, we're looking at rainfall totals that could be an excess of 10 inches, maybe upwards of 12 inches over a seven day period in those locations. What will happen is we just have a pattern where one wave will go through followed by another wave and will go over the same location. We call this training where you kind of get like rail cars on a railway one after another going over the same location.

Don Day: 19:14

So we're gonna have flooding concerns in those areas here this week.

Todd Gleason: 19:18

And will those concerns develop down the Mississippi River as that all drains as well?

Don Day: 19:23

Well, yeah, certainly will. I mean, you're gonna see water's rising. You know, a year ago at this time, we were concerned about not enough water, in the Mississippi. That's that's gonna be changing, obviously, with what's going on here. So that's an area to keep an eye on.

Don Day: 19:37

We will see a stormy pattern, some severe weather in some of those areas as well. It's just the time of year we're in where you can get these real enhanced areas of heavy precipitation.

Todd Gleason: 19:48

And last week, you talked to us a little bit about, the summer patterns, and the idea that you see a difference between the Eastern and the Western Corn Belt, particularly, and that that it may stay wet in the eastern part of the Corn Belt. Are you still of that mind? Has anything changed in the last week?

Don Day: 20:09

Nothing nothing has changed. And, you know, one thing that is important as you go into the warmer season is soil moisture. How much soil moisture are we carrying over from the spring? And if it's a wet spring, that makes it harder for the summer to be drier.

Todd Gleason: 20:24

It also needs to be wet out west for it to pick up that rainfall. Exactly. And and and so what what do you see across for us, I'm gonna guess that needs to be Kansas and Missouri, maybe parts of Texas, Oklahoma. Do you see them getting more rainfall?

Don Day: 20:39

I do. I think the western areas of those states that I would be concerned about. I would be concerned about as you go further into Central And Western Kansas, Central Western Oklahoma, into the Texas Panhandle, and then into West Central parts of Nebraska, Western Dakota. Those areas I think they're dry now, they're in drought status and a wet spring is going to help but again it goes back to soil moisture. It needs to be a very, very wet spring to help them in the summer.

Don Day: 21:08

And right now, we'll probably say it it while it doesn't look as dry as it was a year ago at this time, that precipitation chances are gonna be closer to normal in those western areas.

Todd Gleason: 21:18

So if this sets up the way you think it will set up, does that mean that the chance for drought in, parts of Iowa through Illinois, Indiana going to the East will, from your perspective, be more likely as we get later into the summer season?

Don Day: 21:37

Well, if there's gonna be concerns, that's when there. You know, one thing that we need to hit upon is is that the natural flow of moisture that comes up out of Central America and Mexico, we call it the North American monsoon, that is looking like it's gonna be a lot more active this summer than it did a year ago. And if that does kick into gear, that does throw those evening overnight thunderstorms from the Southern Plains coming into the Corn Belt that can really help with precipitation. So that usually peaks middle to late July through mid to late August. And then if it gets turned off, then, you know, later August into September, we could have concerns about it getting drier.

Todd Gleason: 22:22

Hey. Thank you much.

Don Day: 22:23

Thank you.

Todd Gleason: 22:24

That's Dundee. He's with Day Weather in Cheyenne, Wyoming, joined us on this Tuesday edition of the closing market report that came to you from Illinois Public Media. It's public radio for the farming world. Online, on demand, anytime you'd like to hear us at willag.org, w I l l a g 0 r g, where you can find information from the agricultural economist, the crop scientist, and the animal scientist right here on the Urbana Champaign campus of the Yobai. And subscribe to our programming as podcast or you can just search them out in your favorite podcast applications by name like Closing Mark Report, Commodity Week, the Illinois Nutrient Loss Reduction podcast.

Todd Gleason: 23:03

Thank you for listening. You have a great afternoon. I'm extension's Todd Gleason.