Episode Number
10405
Episode Show Notes / Description
The July 31, 2026, episode of the Closing Market Report features host Todd Gleason speaking with market analyst Mike Zuzolo and meteorologist Eric Snodgrass. Zuzolo outlines how current geopolitical tensions, including tariffs, sanctions, and expanding global conflicts, are driving market volatility and influencing asset rotation out of equities and into commodities, despite high bond yields. He also notes poor crop conditions in Europe and suggests upcoming USDA reports could lower U.S. corn yield expectations, though demand remains a critical unknown. Snodgrass provides a weather update, noting that intense heat has severely stressed crops in the Western Corn Belt—causing potentially significant yield losses—while the eastern regions remain in better condition. Looking ahead, Snodgrass anticipates a moderation in U.S. temperatures for August but warns that an impending, historic El Niño could disrupt South American planting seasons and complicate the upcoming U.S. fall harvest.
Transcript
cmr260731
The July 31, 2026, episode of the Closing Market Report features host Todd Gleason speaking with market analyst Mike Zuzolo and meteorologist Eric Snodgrass. Zuzolo outlines how current geopolitical tensions, including tariffs, sanctions, and expanding global conflicts, are driving market volatility and influencing asset rotation out of equities and into commodities, despite high bond yields. He also notes poor crop conditions in Europe and suggests upcoming USDA reports could lower U.S. corn yield expectations, though demand remains a critical unknown. Snodgrass provides a weather update, noting that intense heat has severely stressed crops in the Western Corn Belt—causing potentially significant yield losses—while the eastern regions remain in better condition. Looking ahead, Snodgrass anticipates a moderation in U.S. temperatures for August but warns that an impending, historic El Niño could disrupt South American planting seasons and complicate the upcoming U.S. fall harvest.
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Todd Gleason: This is the July 31 edition of the Closing Market Report. I’m Extension’s Todd Gleason. It has been a busy day and a busy week. Futures finished with corn down about four and a half cents, soybeans off a penny and a quarter, and wheat 24 cents lower. Mike Zuzolo with GlobalCommResearch.com, out of Atchison, Kansas, now joins us to take a look at the marketplace. It has been an awfully busy week, Mike. Thank you for being with us today.
Mike Zuzolo: My pleasure, Todd. It has been a real rock-and-roll roller coaster this week.
Todd Gleason: It has been a tough week, actually. Soybeans had a tough week, and wheat had a really rough day on Friday. Can you tell me about those two things?
Mike Zuzolo: This goes back to what we talked about a couple of weeks ago. This is where the tariffs, trade, and sanctions have reared their ugly head in the market. I am not worried about the price action as we closed out the month of July because I think a lot of this was book shutting and profit-taking for asset allocators and performance allocators. The one thing that bothered me this week, something we have talked about several times in the past few months, is bond yields and the debt load we are carrying. My biggest concern as we closed out Friday’s trade was that the 10-year yield took a shot at a new 2026 high. It is now only about a tenth of a point away from the 2025 high, and a quarter point away from the 2024 high, which was the highest since 2007.
To revisit that issue fundamentally, if we see bond yields go up because of debt loads and fearful GDP losses this week, it is probably going to instigate dollar firmness. More importantly, it will probably take money and potential rotation out of the stock market and into commodities. We started to see that in the beginning of July, especially after the end-of-June stocks and acreage report. We saw real moving and shaking by asset managers back into commodities, and El Nino was part of that.
Conditions in Russia and Ukraine are worse than ever. Conditions in the Middle East are the worst since the conflict started last February. I looked at shipping data on Thursday, and we had six to nine ships go through the Strait of Hormuz. Before the conflict, it averaged 110 per day. We haven’t seen changes there. The French government came out and rated their corn crop the worst since 2011, at 34% good to excellent. When we talked about a 2012-type drought in France, that is real and in the numbers now. Nothing has really changed regarding supply-demand fundamentals, except we are very high-priced in wheat and relatively high-priced in beans. We are still very economic and competitive in the corn market.
Todd Gleason: Let’s put some of this together. First, higher bond yields and money flow. If it comes into commodities, it doesn’t have to come in on the buy side; it could come in on the sell side. Do we see that, or is that what you are expecting? When it comes in, which direction does the market go?
Mike Zuzolo: I wanted to see, because of the global El Nino, strong demand, and shrinking supplies—which is still the missing link to me to answer your question. The trade still thinks we have ample supplies because they see demand going down right now. They have been going back and forth like a teeter-totter on that. They push premium into crude and pull it right back out again. President Trump is going to Camp David this weekend to talk about expanding military conflict with Iran to get a relatively quick victory. If I were a fund manager in equities, I would overweight stocks and get back into commodities because of geopolitics. We saw another oil refinery blown up in the Kerch Strait by the Russians against the Ukrainians, and grain terminals hit this week.
The rotation mindset should be there. However, with higher bond yields, sanctions, tariffs, and China and the US throwing spitballs through diplomats, I think the trade is deciding to pull money out of both the stock market and commodities and wait.
Todd Gleason: So they are going to set to the sideline. That would mean less volatility and a dropping market, do you think?
Mike Zuzolo: It would probably mean more volatility as measured by the VIX. That is something we will likely discuss in August: whether the true volatility measurement of at-the-money options in the S&P 500 spikes above 20. If it goes above 25, historically, that can instigate larger liquidation in equities. What would cause that circumstance? Sharply rallying bond yields and the dollar. If that is the case, commodities might not see the purchasing and rotation we want. However, looking at pure supply-demand fundamentals at this stage, even with trade sanctions and tariffs, I don’t think money should be pulled out of commodities right now. That should happen closer to the fourth quarter because we still have a lot of weather to go through in the US, Europe, Ukraine, Australia, and Southeast Asia.
Todd Gleason: What impact does the Federal Reserve making no move with interest rates this week have?
Mike Zuzolo: Probably the biggest disappointment Friday, because it dovetails with what we discussed. We saw a weakening GDP number Tuesday or Wednesday, and then Wednesday the Fed announced no change. Thursday morning, GDP came out much weaker at 1.5% for the second quarter. I thought it makes sense for the Fed not to raise rates if they are worried about demand. That should give the market confidence that we don’t need two or three rate hikes by the end of the year. The trade isn’t buying into that, though. That new 2026 high in the 10-year yield disturbed me more than anything else.
Todd Gleason: Farmers are probably worried after last week, looking at new contract highs in soybeans, and then the fall this week in both soybeans and wheat. Is there anything they should do as we head into August? This is an interesting month because sometimes lows are set early and we move higher, or things just fall out of bed.
Mike Zuzolo: That is an excellent point. It would be wise for anyone who hasn’t taken a trial to get a four-week free trial on GlobalCommResearch.com for a better answer. My model years are still 2010 and 2011. That was a rally into the August WASDE report. If we can’t pick that rally back up next week, it will concern me. If we don’t, we will eat into key technical and profitable levels, especially for soybeans and, to a lesser degree, new crop wheat. That would make me want to get recommendations on paper or make catch-up sales for people dragging their feet on physical soybean sales. I made my first 2027 sale in wheat this week as we hit price targets I was hoping for.
Todd Gleason: In August, the USDA will release the crop production number on the 12th. What do you suppose it might show for yield, and will they change acreage?
Mike Zuzolo: I think they could show a lower corn yield. I have been surprised the last six or seven days talking to clients in Illinois, Indiana, and Kentucky—east of the Mississippi River—about how their beans look very good, but they have lost potential in their corn crop. That matches up with the conditions report. Illinois has not been above 60% good to excellent since mid-June. Five of the top seven states by acreage have lower good to excellent numbers than last year at this time. A 183 yield is a tough sell right now given the weather pattern, and it looks like the Western Corn Belt is going to turn hot and dry again. I could see the USDA cutting yield, but what do they do with demand? That is the big question. Are we closer to a 1.5 billion carryover? That is what I will be watching.
Todd Gleason: Let’s turn our attention to the weather forecast. Eric Snodgrass is here. He is with Nutrien Ag Solutions and Agrible. Thank you again for being with us this week.
Eric Snodgrass: You bet.
Todd Gleason: As we close out this month on the last day of July, looking back at the weather forecasts in place during the month, I wonder how well the models did. They seemed to be all over the place picking up what the weather was going to be and what actually happened.
Eric Snodgrass: Whenever I look back on a forecast, I remember that models are tools, not the end-all-be-all. It is our interpretation of them. I do not know that I interpreted things very well at the end of June predicting July. I said we would have heat in July, but I didn’t think it would be long in duration and figured we would have cooler interludes. As a blanket sentence, I got that right, but I didn’t capture the magnitude of the heat. Look at the western side of the state over to Northern Missouri, Iowa, the Dakotas, and Nebraska; July pushed them past 140 stress degree days. That is a critical threshold where we lose yield.
In Illinois, heat came in bursts with high overnight lows, but we got dew most mornings. I gave myself a letter grade this morning—I was a professor for a while—and I was at a C minus or D plus. I wasn’t sold on just the heat. The question is, did the crop do well with it? Recent crop ratings dropped, and national yield numbers came down. What is being underreported is the massive heat wave in Europe. I do not think we fully understand what that will do to global supply and demand. There was also a strong signal of an energetic jet stream running across the South Pacific slamming into Chile. That might be an indicator for this upcoming spring in South America.
Todd Gleason: Have you been able to do any ground truthing and actually look at things on the ground?
Eric Snodgrass: I have. I talked to growers this week in North Dakota and the Red River Valley. I got into Fargo on Tuesday; it was over 100 degrees at 6 PM, and nighttime temperatures didn’t cool off much. Looking at the national yield map, Eastern Iowa through most of Illinois and Indiana looks really good. Western Iowa, the Dakotas, and Nebraska have holes that need to be filled in. The recent rain will help Nebraska, Iowa, Minnesota, and Wisconsin, but it didn’t get to the Red River Valley. That will be a spot where we continue to see major yield losses for corn and soybeans. The crop looks green from the road, but it is in trouble when you look closely.
Todd Gleason: Let’s talk about the rainfall in the forecast for this weekend. How much and where?
Eric Snodgrass: I watched it move through parts of Iowa, Minnesota, and South Dakota. Sioux Falls got a tenth of an inch. Better rain has come farther east, and we will get rounds midday today and watch the low curl up over us late today into tomorrow. It will prolong the cooler weather, cloud cover, and rain. I want to talk to Andrew Pritchard about this, as it is his specialty, but we might have cold air funnels. Nothing alarming, but the right makeup for little funnel clouds that usually don’t touch the ground. It is a 30-hour event with cooler weather behind it. I like this start to August; I just wish we were talking about this on July 16, not July 31.
Todd Gleason: Anything else in the United States before we look elsewhere, or into August?
Eric Snodgrass: Looking at the Western Corn Belt and Western Plains, there is significant risk they stay hot. I do not think that is the case for us. I think we have a better chance of routine temperatures in August with less extreme heat risk. I would watch the Western Corn Belt carefully. They have already taken a hit, and we need to consider what that means for harvest.
Todd Gleason: On the global stage, what are you watching?
Eric Snodgrass: The biggest thing is South America. Outside of Europe, South America is a very important September, October, and November forecast. We are predicting a very wet south and a very dry north. Historically, when that pattern sets up, they tend to be two to three weeks behind in planting. If that comes to fruition and planting progress stalls, that is positive for US markets. El Nino is tearing through and expected to be historic, pushing numbers high. That will also influence our harvest, potentially creating tighter harvest windows.
Todd Gleason: Wet here, wet in parts of South America—Argentina and Southern Brazil—and drier in Mato Grosso?
Eric Snodgrass: Drier in Mato Grosso. That combination slows them down because they wait for rain in the north and try to get rid of rain in the south. It will be flip-flopped this year. The precipitation pattern could be problematic in South America.
Todd Gleason: Thanks much, I appreciate it.
Eric Snodgrass: You bet, thank you.
Todd Gleason: Eric Snodgrass is with Nutrien Ag Solutions and Agrible. He joins us here on the Closing Market Report each and every Friday afternoon. You may hear him again by visiting our website at WILLAg.org or by searching out the Closing Market Report in your favorite podcast applications like Spotify, Apple, YouTube, and many more. If you can stay with us for the hour, you’ll hear all of our commodity week programming coming up next. Otherwise, many radio stations will carry it over the weekend. Again, it is available online at WILLAg.org.
The July 31, 2026, episode of the Closing Market Report features host Todd Gleason speaking with market analyst Mike Zuzolo and meteorologist Eric Snodgrass. Zuzolo outlines how current geopolitical tensions, including tariffs, sanctions, and expanding global conflicts, are driving market volatility and influencing asset rotation out of equities and into commodities, despite high bond yields. He also notes poor crop conditions in Europe and suggests upcoming USDA reports could lower U.S. corn yield expectations, though demand remains a critical unknown. Snodgrass provides a weather update, noting that intense heat has severely stressed crops in the Western Corn Belt—causing potentially significant yield losses—while the eastern regions remain in better condition. Looking ahead, Snodgrass anticipates a moderation in U.S. temperatures for August but warns that an impending, historic El Niño could disrupt South American planting seasons and complicate the upcoming U.S. fall harvest.
---
Todd Gleason: This is the July 31 edition of the Closing Market Report. I’m Extension’s Todd Gleason. It has been a busy day and a busy week. Futures finished with corn down about four and a half cents, soybeans off a penny and a quarter, and wheat 24 cents lower. Mike Zuzolo with GlobalCommResearch.com, out of Atchison, Kansas, now joins us to take a look at the marketplace. It has been an awfully busy week, Mike. Thank you for being with us today.
Mike Zuzolo: My pleasure, Todd. It has been a real rock-and-roll roller coaster this week.
Todd Gleason: It has been a tough week, actually. Soybeans had a tough week, and wheat had a really rough day on Friday. Can you tell me about those two things?
Mike Zuzolo: This goes back to what we talked about a couple of weeks ago. This is where the tariffs, trade, and sanctions have reared their ugly head in the market. I am not worried about the price action as we closed out the month of July because I think a lot of this was book shutting and profit-taking for asset allocators and performance allocators. The one thing that bothered me this week, something we have talked about several times in the past few months, is bond yields and the debt load we are carrying. My biggest concern as we closed out Friday’s trade was that the 10-year yield took a shot at a new 2026 high. It is now only about a tenth of a point away from the 2025 high, and a quarter point away from the 2024 high, which was the highest since 2007.
To revisit that issue fundamentally, if we see bond yields go up because of debt loads and fearful GDP losses this week, it is probably going to instigate dollar firmness. More importantly, it will probably take money and potential rotation out of the stock market and into commodities. We started to see that in the beginning of July, especially after the end-of-June stocks and acreage report. We saw real moving and shaking by asset managers back into commodities, and El Nino was part of that.
Conditions in Russia and Ukraine are worse than ever. Conditions in the Middle East are the worst since the conflict started last February. I looked at shipping data on Thursday, and we had six to nine ships go through the Strait of Hormuz. Before the conflict, it averaged 110 per day. We haven’t seen changes there. The French government came out and rated their corn crop the worst since 2011, at 34% good to excellent. When we talked about a 2012-type drought in France, that is real and in the numbers now. Nothing has really changed regarding supply-demand fundamentals, except we are very high-priced in wheat and relatively high-priced in beans. We are still very economic and competitive in the corn market.
Todd Gleason: Let’s put some of this together. First, higher bond yields and money flow. If it comes into commodities, it doesn’t have to come in on the buy side; it could come in on the sell side. Do we see that, or is that what you are expecting? When it comes in, which direction does the market go?
Mike Zuzolo: I wanted to see, because of the global El Nino, strong demand, and shrinking supplies—which is still the missing link to me to answer your question. The trade still thinks we have ample supplies because they see demand going down right now. They have been going back and forth like a teeter-totter on that. They push premium into crude and pull it right back out again. President Trump is going to Camp David this weekend to talk about expanding military conflict with Iran to get a relatively quick victory. If I were a fund manager in equities, I would overweight stocks and get back into commodities because of geopolitics. We saw another oil refinery blown up in the Kerch Strait by the Russians against the Ukrainians, and grain terminals hit this week.
The rotation mindset should be there. However, with higher bond yields, sanctions, tariffs, and China and the US throwing spitballs through diplomats, I think the trade is deciding to pull money out of both the stock market and commodities and wait.
Todd Gleason: So they are going to set to the sideline. That would mean less volatility and a dropping market, do you think?
Mike Zuzolo: It would probably mean more volatility as measured by the VIX. That is something we will likely discuss in August: whether the true volatility measurement of at-the-money options in the S&P 500 spikes above 20. If it goes above 25, historically, that can instigate larger liquidation in equities. What would cause that circumstance? Sharply rallying bond yields and the dollar. If that is the case, commodities might not see the purchasing and rotation we want. However, looking at pure supply-demand fundamentals at this stage, even with trade sanctions and tariffs, I don’t think money should be pulled out of commodities right now. That should happen closer to the fourth quarter because we still have a lot of weather to go through in the US, Europe, Ukraine, Australia, and Southeast Asia.
Todd Gleason: What impact does the Federal Reserve making no move with interest rates this week have?
Mike Zuzolo: Probably the biggest disappointment Friday, because it dovetails with what we discussed. We saw a weakening GDP number Tuesday or Wednesday, and then Wednesday the Fed announced no change. Thursday morning, GDP came out much weaker at 1.5% for the second quarter. I thought it makes sense for the Fed not to raise rates if they are worried about demand. That should give the market confidence that we don’t need two or three rate hikes by the end of the year. The trade isn’t buying into that, though. That new 2026 high in the 10-year yield disturbed me more than anything else.
Todd Gleason: Farmers are probably worried after last week, looking at new contract highs in soybeans, and then the fall this week in both soybeans and wheat. Is there anything they should do as we head into August? This is an interesting month because sometimes lows are set early and we move higher, or things just fall out of bed.
Mike Zuzolo: That is an excellent point. It would be wise for anyone who hasn’t taken a trial to get a four-week free trial on GlobalCommResearch.com for a better answer. My model years are still 2010 and 2011. That was a rally into the August WASDE report. If we can’t pick that rally back up next week, it will concern me. If we don’t, we will eat into key technical and profitable levels, especially for soybeans and, to a lesser degree, new crop wheat. That would make me want to get recommendations on paper or make catch-up sales for people dragging their feet on physical soybean sales. I made my first 2027 sale in wheat this week as we hit price targets I was hoping for.
Todd Gleason: In August, the USDA will release the crop production number on the 12th. What do you suppose it might show for yield, and will they change acreage?
Mike Zuzolo: I think they could show a lower corn yield. I have been surprised the last six or seven days talking to clients in Illinois, Indiana, and Kentucky—east of the Mississippi River—about how their beans look very good, but they have lost potential in their corn crop. That matches up with the conditions report. Illinois has not been above 60% good to excellent since mid-June. Five of the top seven states by acreage have lower good to excellent numbers than last year at this time. A 183 yield is a tough sell right now given the weather pattern, and it looks like the Western Corn Belt is going to turn hot and dry again. I could see the USDA cutting yield, but what do they do with demand? That is the big question. Are we closer to a 1.5 billion carryover? That is what I will be watching.
Todd Gleason: Let’s turn our attention to the weather forecast. Eric Snodgrass is here. He is with Nutrien Ag Solutions and Agrible. Thank you again for being with us this week.
Eric Snodgrass: You bet.
Todd Gleason: As we close out this month on the last day of July, looking back at the weather forecasts in place during the month, I wonder how well the models did. They seemed to be all over the place picking up what the weather was going to be and what actually happened.
Eric Snodgrass: Whenever I look back on a forecast, I remember that models are tools, not the end-all-be-all. It is our interpretation of them. I do not know that I interpreted things very well at the end of June predicting July. I said we would have heat in July, but I didn’t think it would be long in duration and figured we would have cooler interludes. As a blanket sentence, I got that right, but I didn’t capture the magnitude of the heat. Look at the western side of the state over to Northern Missouri, Iowa, the Dakotas, and Nebraska; July pushed them past 140 stress degree days. That is a critical threshold where we lose yield.
In Illinois, heat came in bursts with high overnight lows, but we got dew most mornings. I gave myself a letter grade this morning—I was a professor for a while—and I was at a C minus or D plus. I wasn’t sold on just the heat. The question is, did the crop do well with it? Recent crop ratings dropped, and national yield numbers came down. What is being underreported is the massive heat wave in Europe. I do not think we fully understand what that will do to global supply and demand. There was also a strong signal of an energetic jet stream running across the South Pacific slamming into Chile. That might be an indicator for this upcoming spring in South America.
Todd Gleason: Have you been able to do any ground truthing and actually look at things on the ground?
Eric Snodgrass: I have. I talked to growers this week in North Dakota and the Red River Valley. I got into Fargo on Tuesday; it was over 100 degrees at 6 PM, and nighttime temperatures didn’t cool off much. Looking at the national yield map, Eastern Iowa through most of Illinois and Indiana looks really good. Western Iowa, the Dakotas, and Nebraska have holes that need to be filled in. The recent rain will help Nebraska, Iowa, Minnesota, and Wisconsin, but it didn’t get to the Red River Valley. That will be a spot where we continue to see major yield losses for corn and soybeans. The crop looks green from the road, but it is in trouble when you look closely.
Todd Gleason: Let’s talk about the rainfall in the forecast for this weekend. How much and where?
Eric Snodgrass: I watched it move through parts of Iowa, Minnesota, and South Dakota. Sioux Falls got a tenth of an inch. Better rain has come farther east, and we will get rounds midday today and watch the low curl up over us late today into tomorrow. It will prolong the cooler weather, cloud cover, and rain. I want to talk to Andrew Pritchard about this, as it is his specialty, but we might have cold air funnels. Nothing alarming, but the right makeup for little funnel clouds that usually don’t touch the ground. It is a 30-hour event with cooler weather behind it. I like this start to August; I just wish we were talking about this on July 16, not July 31.
Todd Gleason: Anything else in the United States before we look elsewhere, or into August?
Eric Snodgrass: Looking at the Western Corn Belt and Western Plains, there is significant risk they stay hot. I do not think that is the case for us. I think we have a better chance of routine temperatures in August with less extreme heat risk. I would watch the Western Corn Belt carefully. They have already taken a hit, and we need to consider what that means for harvest.
Todd Gleason: On the global stage, what are you watching?
Eric Snodgrass: The biggest thing is South America. Outside of Europe, South America is a very important September, October, and November forecast. We are predicting a very wet south and a very dry north. Historically, when that pattern sets up, they tend to be two to three weeks behind in planting. If that comes to fruition and planting progress stalls, that is positive for US markets. El Nino is tearing through and expected to be historic, pushing numbers high. That will also influence our harvest, potentially creating tighter harvest windows.
Todd Gleason: Wet here, wet in parts of South America—Argentina and Southern Brazil—and drier in Mato Grosso?
Eric Snodgrass: Drier in Mato Grosso. That combination slows them down because they wait for rain in the north and try to get rid of rain in the south. It will be flip-flopped this year. The precipitation pattern could be problematic in South America.
Todd Gleason: Thanks much, I appreciate it.
Eric Snodgrass: You bet, thank you.
Todd Gleason: Eric Snodgrass is with Nutrien Ag Solutions and Agrible. He joins us here on the Closing Market Report each and every Friday afternoon. You may hear him again by visiting our website at WILLAg.org or by searching out the Closing Market Report in your favorite podcast applications like Spotify, Apple, YouTube, and many more. If you can stay with us for the hour, you’ll hear all of our commodity week programming coming up next. Otherwise, many radio stations will carry it over the weekend. Again, it is available online at WILLAg.org.