Todd Gleason: 00:00

From the Land Grant University in Urbana Champaign, Illinois, this is the closing market report for the 10th day of February 2025. Happy birthday to my brother, Rob. I'm University of Illinois Extension's, Todd Gleeson. Coming up, we'll talk about the commodity markets with Kurt Kimmel. He's at agmarket dot net.

Todd Gleason: 00:18

We'll hear from Frane Olson at North Dakota State University Extension about tomorrow's WASDE or World Agricultural Supply and Demand Estimates and his thoughts on the marketplace. And then as we close out our time together, we'll take a look at the weather forecast too that with Mark Caruso. He's at Adverse Stream Analytics. And along the way, I'll remind you to visit our website at willag.org, where today you can see the agenda for the all day outlook at the beef house. That's coming up in less than a month now, and you can register.

Todd Gleason: 00:48

So get yourself to willag.org right now at willag.0rg and register for the all day Ag Outlook and prep for this Monday edition of the closing market report from Illinois Public Media.

announcer: 01:03

Todd Gleason services are made available to WIL by University of Illinois extension.

Todd Gleason: 01:08

March corn for the day at $4.91 and a half finished four higher. The May settled at $5.00 4 and a half up four, and December futures up five and a quarter. A settlement price at $4.71 and a quarter. The March beans, unchanged at $10.49 and a half. November, 10 50, 7 and a half, unchanged as well.

Todd Gleason: 01:25

Bean meal at $300.50, down 90¢. The bean oil, 25¢ lower at $45.73. Soft red winter wheat at $5.79 and a half, 3 and a quarter lower for the March. The hard red at $5.96 and three quarters down 7 and a half cents. Live cattle futures a dollar 35 higher.

Todd Gleason: 01:43

Feeder cattle up $3.22 and a half, and lean hogs were 52 and a half cents lower. Now joining us to take a look at this marketplace is Kirk Kimmel. He's at AGMarket.net. Hi, Kirk. Thanks for being with us on a Monday.

Todd Gleason: 01:56

Tell me about, the marketplace as you saw the trade today.

Curt Kimmel: 01:59

Well, corn, continues to climb the wall of worry. There was a little concern, last night, and the corn market did open lower, beans too, and, some additional, tariffs being initiated. Just fear that or concern that it could escalate. I guess the concern is the aluminum for for those who buy products that's packaged in an aluminum might wanna maybe switch to invest in some glass to for those, packaging companies due to the fact that Luma could maybe get a little pricey. But just concerned about these tariffs, where where where that's leading to.

Curt Kimmel: 02:38

But the market, I think, is a little bit more focused on demand still robust. We saw Mexico come in and pick up an additional 365,000 tons of corn. They need corn. They're gonna continue, hopefully, to buy corn as we're probably the best supplier. But what's kind of front and center, I don't know if it's gonna be a big market maker tomorrow, would be the monthly supply demand report, Todd.

Todd Gleason: 03:04

Yeah. So the world agricultural supply and demand estimate is due out tomorrow. The numbers that could change, more than likely would be the Argentine corn and or soybean numbers. I suppose corn more likely than soybean at this time, just based on where it is in its maturity. What's the trade thinking about?

Curt Kimmel: 03:26

Well, on the origin,

Frayne Olson: 03:29

at at

Curt Kimmel: 03:29

teen corn, average trades just a little bit lower down by 1,300,000 metric tons at about 48,000,000 metric tons. The ag market team lowered theirs down about 49.5, so a little smaller, crop there. Same thing on the the soybean crop, looking for last month, we were at 52,000,000 metric tons. This month, 50.6. So down about 1.5.

Curt Kimmel: 03:57

The ag market team's right with, one 49,000,000 metric tons. So looking at just a little smaller there. On the corn crop, basically, the average, gas is 26.8. Last month, a 27, so slightly lower. And on the beans, slightly higher.

Curt Kimmel: 04:21

Brazilian bean estimate last month was a 69,000,000 metric tons. Ag market team's actually at a 70 feeling that, that Brazilian crop is a little better. Not much, but just a little better than what the, the the trade is looking at. The other part of the equation is the domestic numbers. Not not not a whole lot of change there.

Curt Kimmel: 04:48

We'll expecting kind of unchanged number there. I believe we're still early enough in the marketing year that there's not gonna be a whole lot of adjustments on this report. They'll probably start making some adjustments as we go into March or April on the domestic numbers or the type.

Todd Gleason: 05:05

What else have you been watching in the marketplace? I know you've been probably closely tracking. Again, as you, mentioned, the tariff proposals by the Trump administration, have there been reprisals or others from Mexico or China or other places that are tracking back for retaliation at this time?

Curt Kimmel: 05:25

Well, we'll we'll see. We we did see, the, Chinese come in, some additional, tariffs, mainly on the energy sector, which is kinda surprising to me from the standpoint. They're an importer of energy, but, they went after energy. Of course, vehicles, I I believe is pickup trucks, but they're a small consumer of US pickup trucks and some pharma farm equipment. So but we'll see how this unfolds.

Curt Kimmel: 05:56

The biggest thing is as we approach the end of the month here, March, see where we are with Mexico and, Canada particularly because they're much larger, purchasers and sellers of corn and cattle and so forth to the Southern Hemisphere. Yeah. Watch that weather map. A lot of the drought monitors or weather forecast don't show Mexico in the picture here, but the Mexican forecast remains arid. And Mexico's gonna continue to need some grain for their country here.

Curt Kimmel: 06:32

So Mexico is a key player here for the corn market as we move forward.

Todd Gleason: 06:35

What is the Ag Market team's Brian split telling you about the technical picture for the marketplace? Anything of interest?

Curt Kimmel: 06:41

Yeah. He's he's he's kinda been in the camp here on the bean chart. It's kinda head and shoulders bottom formation here. And the main thing is watching that two hundred day moving average. It's just above the marketplace.

Curt Kimmel: 06:54

We've bumped into it a few times. Even this, he doesn't know what the technical or the fundamental picture is gonna show here or unfold. But, technically, if we can move above that two hundred day moving average, maybe we have a little giddy up in the marketplace. Corn did that a while back, and Corn's been finding support on just about every pullback we've seen here over the last two months. Corn wise, just about every 10¢ up, a little bit of resistance, about every 10¢ down, some fairly good support.

Curt Kimmel: 07:26

But the team came in, and we did, you know, do a little marking here on the December futures of this 470 area. Recommending put some price floors in because this market can go the other way in a hurry. Not a crop insurance agent, but, average, price for, corn here, is just a few pennies above a year ago, but beans are almost a dollar below a year ago there, Todd.

Todd Gleason: 07:49

Thank you much, Curt. You bet. Take care. Curt Kimmel is with AgMarket.net. The theme music for the closing market report is written, performed, produced in courtesy of Logan County, Illinois Farmer Tim Gleeson.

Todd Gleason: 08:06

Do visit our website. The address is wilag.org, w I l l a g 0 r g, where today you'll find the full agenda of the upcoming Tuesday, March 4, all day outlook to be held at the Beef House in Covington, Indiana. Registration is just $40 and includes the whole of the agenda, plus your Beef House coffee and roll in the mornings and that fantastic Beef House lunch. Don't wait. Register today.

Todd Gleason: 08:32

The cost is $40 at willag.0rg or on the FarmDoc site at farmdocdaily.illinois.edu. Frane Olson now joins us from North Dakota State University where he's an agricultural economist with Extension. Thank you very much, Frane, for being with us. On Tuesday, USDA will update the World Agricultural Supply and Demand Estimates reports. Are there any expectations that the domestic numbers here in The United States will change?

Frayne Olson: 09:05

The odds are pretty low. I mean, when you look at what the prereport industry guesses are or estimates, you know, they're they're maybe looking for a slight tightening of the corn balance sheet, and because we've we're actually, when you look at today's numbers, a bit ahead of the the pace that USDA is looking for. So we we're having a better export season so far. They might increase the exports number a little bit, which would tighten up the bottom line. You know, corn the soybeans and the wheat numbers, I think, will come in pretty stable.

Frayne Olson: 09:37

So, you know, I really don't expect any big shocks or surprises. That's typically the February report is relatively stable. We're just kinda nibbling around the edges and making sure that we we're refining the forecast. So taking the current information that we have, updating those, and just trying to make some small revisions. So I really don't expect anything domestically to change.

Frayne Olson: 10:00

Internationally, you know, we're everybody's looking and focused on what's happening in South America. We're there's a few issues, you know, too much rain in Northern Brazil. You know, Argentina is a bit on the dry side. I again, I think it's a little too early in the season or too early within a production cycle for USDA to make any major changes there. I have seen some of the private forecasters adjusting their estimates, for both, again, both Brazil and Argentina.

Frayne Olson: 10:32

But I really don't think USDA will do that yet. They're gonna wanna have confirmation that the problem is is is really severe and that it's gonna actually have an impact on the ending numbers. So I I think this February report's gonna be relatively quiet. You know, I kinda said that last time as well, but in the January report, and I was certainly wrong on that one.

Todd Gleason: 10:52

The other item that has been out there, and we'll be talking about it for at least four years, I suspect, is what, farmers will oftentimes call the Trump trade. And this is about tariffs, but when they talk about Trump trade, that's about the futures markets, I think. Can you give me your view of where the futures markets are considering the Trump trade and how the cash market is dealing with it?

Frayne Olson: 11:21

Yeah. Okay. So, you know, the future market is is really concerned about allocating over time. Right? So we're we're looking at the identical when you look at the contracts we trade, you know, the quantity, the quality, the delivery location, the timing changes, the timing of delivery because we have these different contract periods.

Frayne Olson: 11:43

But, really, the only thing that shifts is that contract period. Everything else is fixed, and so it's very easy to trade. We're we're really concerned about price. Right? And and what's the value of a particular commodity at a particular time?

Frayne Olson: 11:57

So they're looking at the real big picture things, you know, supply and demand. Are we using it up a little too fast or a little too slow? It's really trying to allocate our in our our usage and our and our production over time. The cash market has to worry about a lot more stuff. It's gotta worry about making sure that the right quantity, the right quality arrives at the right location at the right time.

Frayne Olson: 12:22

So the cash market is actually a little more complicated. When it comes to tariffs, the futures market's really concerned about those big picture supply and demand things. If you have a a trade war, if there's a tariff on a particular country, what will that do to, you know, consumption? What's that gonna do to our bottom line? But the cash market is also worried about timing.

Frayne Olson: 12:45

And and one of the things that I've seen or noticed now when we look at weekly export sales, weekly export sales for corn and soybeans have have been pretty pretty good this and and even for wheat, pretty good for the last several months. But it seems as though our export sales are starting to slow. And I don't know if that was because some of the international buyers are trying to build up some inventories ahead of any potential trade war, But the cash market now is I think will respond differently to any kind of trade or trade problems simply because when when if a trade if a tariff were to be put on, the tariff is applied when it crosses the border. So, you know, I could have prepurchased a particular amount at a particular price. That's all locked in, but the tariff is not applied until it crosses the border.

Frayne Olson: 13:37

So even though I might have prepurchased the cash mark, you know, and and locked everything in, the the cash market has to worry about this delivery timing. And will some of those purchases we have on the books be canceled, even with penalty? Will it be canceled? Is this gonna change the timing? Is this gonna change the delivery location, for some of this?

Frayne Olson: 14:00

So, the futures market is always looking forward, trying to anticipate, and the cash market's looking at what kind of reality and saying, well, what do we have in place? And let's make sure that we get the right grain at the right to the right place at the right, like, right time. Right? So they they they can respond differently. You can see more volatility in the in futures versus cash.

Frayne Olson: 14:22

Or on the flip side, you could potentially see more volatility on the cash than the futures. It all depends upon, you know, where where everything's located and where it needs to go.

Todd Gleason: 14:32

To be clear, this would, reflect retaliatory tariffs by a country on a US commodity that they had already purchased. For instance, that could be corn. Correct?

Frayne Olson: 14:44

That's Typically typically, that's the way we look at it. Yes. Because because the, you know, the the tariffs that The United States are putting on is for the importation from other countries. Now when you look at the major commodities, corn, soybeans, wheat, we're really concerned about the retaliatory tariffs. So if if Mexico or Canada or China were to put on, tariffs of US products entering their countries, that's what we're concerned about.

Frayne Olson: 15:14

However, here in the Northern Plains, there's a lot of of grain and product that goes across from North Dakota, Minnesota, Montana into the Canadian markets and vice versa. An example of that is canola. Canola, we have two very large crushing plants in in one in North Dakota, one in Northern Minnesota. They buy a lot of canola from Canada. A lot of us grown domestically, but they also have to import simply because of the size of their of their crushed plants.

Frayne Olson: 15:43

So if we do put on a tariff for for Canadian products, that means that the Canadian canola is more or be priced more highly than the more more, higher than The US or North Dakota canola. And therefore, the value of the North Dakota canola goes up, and it's simply because of the tariffs. And it changes the flow of grain. It changes the logistics pattern significantly.

Todd Gleason: 16:07

And the product that comes out of it may also be tariffed on the way back over the border.

Frayne Olson: 16:13

Yes. It could. Yes. It could. Absolutely.

Frayne Olson: 16:16

And, and I know from North Dakota, we, there's well, back up. The the Canadians are the number one buyer of US ethanol. They're a major buyer for US DDGs. The new crushing plants we have here in North Dakota are sending a lot of their soybean meal into the Canadian hog market as well as the Canadian, beef market, the feed lots in in Western Canada. So, you know, we're we're pretty sensitive to this stuff up here right along the border because it has a pretty big impact on our our trade flows.

Todd Gleason: 16:48

Anything else we should discuss for the day before I let you go?

Frayne Olson: 16:51

You know, no. Just that that, you know, I always remind farmers that the two most difficult things to forecast or predict is weather and politics. And I usually say weather is more difficult, but in today's environment, politics, I think, is gonna be a lot more difficult.

Todd Gleason: 17:08

In indeed. It's always good to talk with you, Frane. Thank you so much. We'll talk with you again next month.

Frayne Olson: 17:15

Alright. Appreciate appreciate the visit. I always always enjoy this.

Todd Gleason: 17:18

Fran Olsen is an agricultural economist with North Dakota State University Extension. He is located in Fargo. Mark Russo now joins us from Everstream Analytics. Hi, Mark. Thanks for being with us today.

Todd Gleason: 17:44

I want to start in South America again. Argentina is the place that has the market on the cusp, wondering whether that crop is hurt enough to really cause an issue within the world marketplace or whether it has gotten enough rainfall and whether will it continue to do so. What what what's your assessment at at this point for both corn and soybeans in that nation?

Mark Russo: 18:10

Yeah. Well, Todd, for Argentina, I think it's a crop by crop situation. For corn, which is more heat sensitive, these heat waves that have taken place in Argentina, certainly, it's taken its cold toll on the crop here and likely caused some irreversible yield damage. Just lately with some of the increase in rain activity at least that has tempered things a bit. But for corn, especially as it's gone through really the heart of its pollination stage here in recent weeks, the heat has been more significant and more detrimental.

Mark Russo: 18:44

For soybeans though, it's a bit of a different story. They're now really beginning the primary window of soybean, pod development and filling. And so now it's a yield sensitive time frame and that'll continue, even all the way into the March as well. And so with rain activity increasing last week in Argentina, kind of a bull's eye of big rainfall totals right in the heart of the corn and soybean belt. That combined with more rain coming up.

Mark Russo: 19:15

In fact, a period of unsettled weather starting tomorrow going all the way through February that should provide more rains in the highest concentrated corn and soybean acreage. So that's more timely here for soybeans and likely, helping, you know, provide more benefit.

Todd Gleason: 19:33

And so we'll have to keep an eye on what the nick looked like in Argentina for corn particularly to give us a better idea of what that crop will do. I suspect that USDA, which has its WASDE or World Agricultural Supply and Demand Estimate, may may not yet have a good handle on what's been taking place in that nation as would be the case if we were here in The United States and you were trying to get a handle on, the size of the corn crop late in the month of July or early in the month of August and didn't know how well Nick went. Turn your attention now to Brazil and update those growing regions for me.

Mark Russo: 20:08

Yeah. Overall, Brazil is in good shape. Although, again, soybean harvesting and safrinha planting is running behind the five year average because of the solar planting earlier and then also some of the recent wetness. Going forward, the pattern is certainly turning less active and actually for much of Eastern Southern Matagrosso, let alone much of Center West Brazil, even down in the Parana. The outlook features below normal rainfall coming up.

Mark Russo: 20:34

So that'll help to improve the harvest pace, not gonna make up ground, but, it is gonna be much better coming up the next few weeks compared to how it has been. Now further south in Rio Grande do Sul, we're developing soybeans are still taking place. The outlook, looks more favorable with rain development there, helping to boost soil moisture, for, developing beans.

Todd Gleason: 20:57

Given how quickly harvest can pace along, do you have concerns for safrinha or a second crop corn?

Mark Russo: 21:04

Not right now. It does push things, you know, the overall season later, which means it starts to push it, the growing season into the potential freeze season once we get into later in May and June and July as a crop, matures and then starts to get harvested. But again, it doesn't mean that there is going to be extreme cold and provide any kind of risk but just a later crop does just inherently at least increase some probabilities of some cold weather threats.

Todd Gleason: 21:33

Wait. They have cold weather threats in that part of Brazil?

Mark Russo: 21:36

Believe it or not, they do. You can have an Arctic air mass move into, all the way up into, Brazil. Typically, it's the Parana, the southern crop that that faces more of some risk there. But, yeah, you you can get a significant cold as far north as Mato Grosso.

Todd Gleason: 21:54

Oh, a new risk factor for the market to consider. Thank you, Mark. Here in The United States, speaking of frozen, we've gotten cold again. What can you tell us about the weather in our region?

Mark Russo: 22:05

Yeah. Speaking of cold, the the next two weeks looks even colder and stormier here for the nation's midsection. While the cold does not look extreme enough to cause any kind of winter kill threats for crops, the increase in precipitation as well as increase, a lot of that being in the form of snow, especially Central And Northern Midwest will actually help, make up some of the precip deficit that's been in place in areas of the Upper Midwest. And overall, this is the most active that the Midwest has been in in quite some time, and that's also benefiting, winter wheat, and even a little bit of weather conditions in the plains, hard red winter wheat belt, especially Central And Northern Belt.

Todd Gleason: 22:48

Hey. Thank you much. I appreciate it. You're welcome, Todd. Mark Russo is with Everest Dream Analytics, joined us on this Monday edition of the closing market report that came to you from Illinois, a public medium.

Todd Gleason: 22:59

It's public radio for the farming world where right now you can buy your tickets for the all day look at willag.org. I'm Extinction's Todd Gleeson.