Apr 29 | Closing Market Report

Todd Gleason: 00:00

From the Land Grant University in Urbana Champaign, Illinois. This is the closing market report. It is the April 2025. I'm extension's Todd Gleeson. Coming up, we'll talk about the commodity markets with Naomi Bloom.

Todd Gleason: 00:12

She's at totalfarmmarketing.com out of West Bend, Wisconsin. We'll get updates from the statisticians on crop conditions and progress in the states of Illinois, Indiana, and Iowa. Dan O'Brien from K State University will be here with a look at the agricultural energies and profitability, particularly in the ethanol plants. And finally, we'll finish up with a look at the weather forecast. Donde will be here from Day Weather in Cheyenne, Wyoming on this Tuesday edition of the closing market report.

Todd Gleason: 00:42

From Illinois Public Media. It is public radio for the farming world. Todd Gleason services are made available to WILL by University of Illinois Extension. May corn down 15 today at four sixty and a half on its settlement. July 13 lowered four seventy and a quarter.

Todd Gleason: 00:59

December at four forty four and a half down five and three quarters. May beans 11 lower. And November 1020 '5 and a quarter down nine and a half cents. Wheat futures in the soft red. July down 5 and a half cents at $5.25 and a half.

Todd Gleason: 01:14

Naomi Blome now joins us from totalfarmmarketing.com out of West Bend, Wisconsin. Hi, Naomi. Thanks for being with us. So I didn't look at the marketplace really until just before we started to talk and was taken aback that corn futures had lost 14 or 15¢ for the day. What has happened?

Naomi Blohm: 01:33

Well, there's a kind of a combination of things that happened today. So part one, we didn't have any immediate bullish news to take the market higher. We got crop progress report yesterday saying that the corn planting is 24% planted. That was up 12%, from the previous week, and the five year average is about 22%. So planting pace, plugging away.

Naomi Blohm: 01:56

And then this morning, we did get some nice export news announcement. We found out that there was 120,000 tons of corn sold to Spain for this old crop marketing year. So that kind of supported the market initially at 08:30. However, as the day went on, we just kind of fell out of favor and just didn't have enough news to take the market going higher, so we saw a little bit of technical selling. Also, tomorrow first notice day for the May grain futures, so we see some position squaring happening with that, with the May contract down hard today because people who were long made corn or May soybeans had to sell and get out of it.

Naomi Blohm: 02:42

And then we got two other just outside market pieces of news that said American confidence in the economy slumped for the fifth straight month, and then there was some more news that China was going to just stay firm against President Trump regarding trade deals. So I think just because we didn't get any friendly news, the technical selling started to take over, pushing markets a little bit lower. But a lot of times, once we get first notice, they out of the way, prices then start working back higher during the month of May.

Todd Gleason: 03:17

I did hear a Chinese representative say that The United States would have to remove, tariffs first before China would make a move. So it'll be interesting to see how that continues to play out, a war of words and wills both. It was interesting to note that there was a difference between old and new crop for corn with new crop holding much better. It still had losses for the day, but only a, I don't know, half to a third of what happened in the old crop. Why would that be the case?

Naomi Blohm: 03:47

Well, we also saw just specific spread trading happening today for traders between old and new crop. The spread had strengthened recently, and so we saw some profit taking happen with that. Same, falling through, in the soybean conflict soybean complex as well, but corn primarily spread trading was definitely noted.

Todd Gleason: 04:08

Anything in the other marketplaces that you were watching very closely, whether that be the products for the soybeans or the wheat, something else?

Naomi Blohm: 04:16

Well, I was keeping an eye today and doing some looking at soybean scenarios for the upcoming crop year. So we're all, you know, in this holding pattern trying to understand where demand will be for soybean exports next year. Right now, we have our soybean exports at 1,825,000,000 bushels. About half of that goes to China. Now I don't think that China is going to just totally stop buying from us, but if we did see a reduction, let's say you use an export number next year for demand at 1,700,000,000 bushels, els.

Naomi Blohm: 04:49

So that would be acknowledging that we could see some demand loss to China. There still leaves no room for any kind of a weather error this summer. I mean, you know, last year we had our yield at 50.7. If we have yield this year at 50, even with a reduction in the demand for exports, but if you keep the crush number the same at 2,400,000,000 bushels with that lower planted acres, you're looking at carryout going to 291,000,000 bushels. So it's gonna be interesting to see how the soybeans respond.

Naomi Blohm: 05:21

It feels like once we get to know a little bit more about the final destination of our export market, then we can really start to look at weather scenarios a little bit more closely for soybeans, because again, there is no room for weather error this summer at all. And I do think that we probably will lose some demand to China, but China year round needs beans coming in to their country, and they do like The US product. So I'm hopeful that we see some negotiations happen there sooner than later, and, we'll keep an eye, of course, on the weather going forward.

Todd Gleason: 05:58

You have in the past, and I made note on x, this week, we're discussing the seasonals and the sales opportunities that it they can afford producers. When you get a down day day to like today, does that change things at all, or do this the seasonals, I know, change and stay in place, but does it adjust the way you think about what the pricing situation might look like?

Naomi Blohm: 06:23

It can. Part of that would depend on how much a market might sell off the downside. Right now, though, we are still in the trading ranges that essentially we have been in since, well, maybe like October, November. We're still holding on to uptrends for old crop corn. New crop corn still also holding on to that uptrend.

Naomi Blohm: 06:45

So the seasonals would suggest for corn and beans both sometimes between Mother's Day and Father's Day, so the May to the June is when you can see your best pricing opportunities for your new crop market. Usually, some sort of a weather scare can spur things higher. So from that standpoint, I'm still a believer in the seasonals. When you look back at seventeen years on corn, about five years corn has put in its high in May. '7 years, it put in its high in June.

Naomi Blohm: 07:17

'5 years, it put in its high in July. So I feel like there's still some opportunity there. But the thing is, it's usually when farmers are busiest, and so you're not always paying attention to the marketplace. So you gotta really be tuned into the markets every day and be focused on cash sale target potentials on December corn, maybe looking back up to that April, '4 '70, barring any kind of a weather scare. And then on the soybeans, it could be an interesting situation there, depending on weather short term and long term.

Naomi Blohm: 07:49

Right now, November beans holding that $10.25 support. If that can continue, if we can get some friendly news, there's an inverted head and shoulders formation that would actually point to $11 as a potential upside target. But, we need some fresh friendly news to get that move in. Otherwise, we could be in a holding pattern here for just a little longer.

Todd Gleason: 08:09

Thank you much, Naomi.

Naomi Blohm: 08:10

Thank you.

Todd Gleason: 08:11

That's Naomi Bloom. She is with totalfarmmarketing.com. Yesterday afternoon, the United States Department of Agriculture released the weekly crop progress report. It shows around the nation 24% of the corn crop had been planted as of Sunday. Twenty two percent is the rolling five year average.

Todd Gleason: 08:34

5% of that crop has emerged, 16 rather 18% of the soybeans have been sown, 12% is the five year average, 27% of the winter wheat has headed, 22% is the five year average and it's said to be in 40% good and 9% excellent condition compared to thirty eight and seven the previous week. Now here are the statisticians from Illinois, Indiana, and Iowa with their updates.

NASS Iowa: 09:00

This is Rebecca Alter, agricultural statistician for the USDA Nass Iowa field office. Periodic rains throughout the week resulted in just two point three days suitable for fieldwork, and cool temperatures hampered crop emergence. Topsoil moisture condition rated 3% very short, 11% short, 75% adequate, and 11% surplus. Corn planted reached 34%, two days ahead of the five year average. Statewide, corn emerged was 2%.

NASS Iowa: 09:38

Twenty five % of the expected soybean crop has been planted, one day ahead of last year and four days ahead of the five year average. Pastures and grass continue to green up. Apart from some muddy feedlots, no livestock issues were reported. Some cow calf payers were being turned out to pasture. And that's this week's report of crop progress and conditions across the state of Iowa.

NASS Iowa: 10:06

For the USDA NASS Upper Midwest Regional Field Office, this is Rebecca Alter.

NASS Illinois: 10:11

Hello, everyone. This is Brad Summa, director of the USDA NASS Heartland region, and this is the Illinois crop progress and condition report. Statewide, the average temperatures was 59.6 degrees, which was 3.8 degrees above normal. Precipitation averaged 1.1 inches, which was point two six inches above normal. Statewide, the topsoil moisture supply is now rated at 1% very short, 10% short, 66% adequate, and 23% surplus.

NASS Illinois: 10:43

For the Illinois corn crop, corn has been planted in 16% of the fields now compared to the five year average of 26% and corn emerged has reached two percent compared to the five year average of 3%. Soybeans planted reached 22% compared to the five year average of 20, and the soybeans emerged has reached 4% compared to the five year average of two. Winter wheat headed has reached 16% compared to the five year average of 12, The winter wheat condition was rated 2% very poor, 4% poor, 37% fair, 49% good, and 8% excellent. For our Illinois cattlemen, the pasture condition were rated 2% very poor, 5% poor, 33% fair, 42% good, and 18% excellent. Again, this is Brad Summa, director of the USDA NASS Heartland region serving the farmers and ranchers in Missouri and Illinois.

NASS Illinois: 11:39

Have a great week, everyone.

NASS Indiana: 11:40

I'm Nathaniel Wernske with USDA NASS. This week, Indiana topsoil moisture rated 90% adequate to surplus for the week ending April 27. Subsoil moisture 83% adequate to surplus. Days suitable for field work was four point eight days. Corn planting was 10%, and soybean crop planted was likewise 10% equal to the five year average.

NASS Indiana: 12:03

Winter wheat jointed was at 50%, slightly behind last year in the five year average. When wheat headed was at 4%, the crop rating decreased to 60%. Good to excellent. And that's this week's report of crop progress and conditions across the state of Indiana. I am Nathaniel Wernski with USDA NASS.

Todd Gleason: 12:22

Our thanks go to the state statisticians for their weekly updates of crop progress across the Midwest. Now let's turn our attention to the agricultural energies. Dan O'Brien is here. He's with Kansas State University Extension out of Colby, an agricultural economist that watches the agricultural energies and runs an Iowa model for ethanol plants. I'm wondering, Dan, what the profitability looks like in that plant this week.

Dan O'Brien: 12:49

Well, where it's profitability in March in ethanol plants, Midwest ethanol plants kind of aiming at an Iowa model was about we'd lost about 1¢ estimated we lost about 1¢ per gallon in March, February zero '9 dollars about $0.11 0 1 2 dollars in December here now in April with the corn prices moving up a little bit up to $4.63 in April as opposed to about $4.44 We're estimating breakeven costs about $1.66 per gallon of ethanol and a loss of so if you have a selling price of $1.61 breakeven price of $1.66 losing about $05 a gallon. You've got a string of months of let's see one, two, three about six months in a row where we're at or below breakeven. Frankly, just in looking at the pace of usage of full production on ethanol we've been holding up decently. It's been kind of a level situation really for the last since December of last year. Just now of late, almost seemingly contra seasonal with driving coming on, etc.

Dan O'Brien: 14:08

It seems like ethanol production trending down marginally here of late. I do wonder about when the summer driving season comes in and open this towards E15 in so many areas, what that will do to the ethanol plant production and profitability. Of course, any production risk that would come in and we're very prone to that right now. Essentially we're entering May, June, July and anything that would drive corn prices sharply higher of course would probably work against ethanol production profitability but we shall see. So I guess in a way Todd is sort of a horse race between what demand for gasoline during the driving season will do to support ethanol prices versus what production risk out in the field for US corn will do to drive corn prices higher.

Dan O'Brien: 15:04

So we'll see where that works itself out and of course ethanol plants operate on the margin, inputs and outputs and we'll see where that goes.

Todd Gleason: 15:13

There has been a strong push in the Western Corn Belt particularly for ethanol production and basis has reflected that. Has that changed?

Dan O'Brien: 15:24

Over the last three or four years, just like clock work, I look at the corn prices and ethanol plants in Kansas and it was the highest in The US compared to each state. Well now when you look at that based on the April 29 numbers, actually the highest corn prices at ethanol plants that are being reported paid are actually in Ohio, dollars four point nine eight as an average followed by Indiana at $4.89 Illinois at $4.79 Kansas comes in at about $4.69 or so. And for a while I thought, gosh, you looked at how dry certain areas were and we had a lot of dryness and probably fears about corn availability in those same three well again, Indiana, Ohio and Illinois. Corn prices here now with some moisture that's come in, still seeing the strength of corn demand at those ethanol plants in the East and I guess I don't have a good explanation for it. If I tracked it far enough back, you probably see a difference in the ethanol prices paid in the East as opposed to out here in the West, but again, I just need to track that down.

Todd Gleason: 16:39

And corn supply remains highly available in your part of the world? Are they switching to wheat because prices are low enough for ethanol production? Other things that might be taking place?

Dan O'Brien: 16:49

Well, now you're touching on a sensitive topic there, Todd. No, I'm just kidding. It is interesting because just last week that the price in Garden City where we would feed wheat, if we're going feed it in any place that's around Garden City with all the feedlots there, the price of wheat was 97% of the price of corn. So yes, there certainly seems to be at least a short term incentive to feed wheat and if we don't have a crop problem and wheat harvest comes on, that situation could exacerbate itself with a fair amount of moderate priced wheat around and corn coming in again JulyAugust. If we have any production worries out here to the West, that's certainly a possibility.

Dan O'Brien: 17:40

We've corn prices going higher. So yeah, we're set up for a situation where we could see a considerable amount of wheat fit. And you know what, given the struggles we've had in actually exporting hard red winter wheat out of The U. S. Because of a number of factors on the world stage, that type of usage would probably be welcome.

Dan O'Brien: 18:01

It helped to move through some piles we'll have out there and help to rectify the situation a little bit.

Todd Gleason: 18:08

I probably should have asked it as a sorghum question substituting for corn in ethanol. Is that available? Because China is not buying.

Dan O'Brien: 18:19

Well, yeah, without strong export demand for grain sorghum we still can use grain sorghum all over the place as a competitive feed grain but it's priced to value relative to the other wealth main competitors, of course that's corn. So it was interesting when USDA came out and projected I think 6.5, six point six million acres of grain sorghum to be planted in The U. S. Up from that was at the March prospective plantings report and that was higher than anybody really had expected. USDA projected 6,000,000 acres earlier at the outlook Conference.

Dan O'Brien: 19:02

So I think the response to that probably was due the reason we probably had that was because of lower cost of production for grain sorghum mainly in the seed and some worries about drought. So we'll see by the time we actually get out in the field and see how farmers vote with their planters and get the actual acreage report in to see what they've actually done moving forward. I would agree with what I think where you're heading on that is that gosh, the slowness of U. S. Grain sorghum exports being directly impacted by the tariff discussions between The U.

Dan O'Brien: 19:42

S. And China certainly has an impact probably on the optimism that farmers have about pricing opportunities there. So it looks like we'll certainly use all the grain sorghum that we produce in feed, in industrial usages. We have ethanol plants that can use them, some exports, but the positive glow on the profitability of sorghum sure shines a lot brighter when we've got strong exports to China. Now without that, we're struggling more in terms of moving the product.

Todd Gleason: 20:19

Hey, thank you much. I appreciate it.

Dan O'Brien: 20:21

Thanks, Todd. Take care.

Todd Gleason: 20:22

You too. That's Dan O'Brien. He is with K State Kansas State University Extension. Let's check the weather forecast now with Don Day. He's a day weather in Cheyenne, Wyoming.

Todd Gleason: 20:37

Hello, Don. Thanks for being with us today.

Don Day: 20:39

Thanks for having me.

Todd Gleason: 20:41

Tell me about the weather forecast across the Corn Belt for the next week. Will there be much rainfall, and can farmers plant?

Don Day: 20:50

Yes. And, yes, how's that? We generally a trend that's gonna be pretty warm. Temperature readings as we go through the May here will be aided by a big trough that's gonna come into California and the Desert Southwest and kinda spin on its heels for a little bit. We're gonna see this developing this weekend and into early next week.

Don Day: 21:14

So what that does is that brings the Southwest flow of air into the Corn Belt. So what that will mean is warm temperatures. It also means we are going to see some shower and thunderstorm activity at times. We probably at times will have to deal with severe weather next week, especially in the South Central And Southern Plains region. But we have the best chances of rain probably in the Central And Eastern Corn Belt.

Don Day: 21:38

However, the Northwest Corn Belt, the rain chances are are there, but they're lower. But we don't see like a continuous rain event or something setting up. We're gonna have these off and on chances of thunderstorms but overall warmer temperatures. So I would all chalk this up to a very favorable looking pattern.

Todd Gleason: 21:55

Yeah. So if we get rainfall it appears that'll be sooner rather than later in the mostly in the Eastern Corn Belt?

Don Day: 22:04

Yeah it looks like the first of all you know here in the short term there is going to be some some weather in the Eastern Corn Belt here over the next twenty four hours or so and into the next day or two. But then what we're going to see as we get to, let's say Friday in the weekend, the activity is gonna be mainly be to our west and to our east. So the weekend and into early next week, the rain chances are lower. So your point is that, yeah, the best chances of rain are in the short term. Medium to longer range term, it looks like a warmer, drier trend.

Todd Gleason: 22:37

And the warmer temperatures are where across the Corn Belt? In the Northern Part of the Corn Belt or Northwestern Part of The Corn Belt?

Don Day: 22:43

Well, it looks like just about everywhere. You know, I I don't see necessarily a bull's eye of the of the warmth, in terms of the anomaly, but it's gonna be Corn Belt wide.

Todd Gleason: 22:52

Hey. Thank you much. I appreciate it. Thank you. Donde is with Day Weather in Cheyenne, Wyoming.

Todd Gleason: 22:57

Joined us on this Tuesday edition of the closing market report that came to you from Illinois Public Media online on demand at willag.org. I'm University of Illinois Extension's Todd Gleason.