May 06 | Closing Market Report

cmr260506

- Ag Markets with Greg Johnson
- Asking County Boards to Site Data Centers is an Unfair Thing
- Pope Leo's Food Waste Petition and Prayer
- Ag Weather with Drew Lerner

Todd Gleason: From the Land-Grant university in Urbana-Champaign, Illinois, this is the Closing Market Report. It is the sixth day of May 2026. I'm Extension's Todd Gleason. Coming up, we'll talk about the commodity markets with Greg Johnson. He's at TGM, that's totalgrainmarketing.com. We'll follow up our conversation with Google yesterday about data centers with an ag policy discussion around the county boards that are helping to site these centers in the state of Illinois and across the Midwest. We'll do that with Jonathan Coppess, Ag Policy Specialist from the U of I. And then we'll turn our attention to food waste. An interesting little tidbit, more than anything else, that was triggered in my mind on Sunday of this past week. And we'll wrap up our discussion today by taking a look at the agricultural weather with Drew Lerner. He's at World Weather, Incorporated in Kansas City, and we'll do that all on this Wednesday edition of the Closing Market Report from Illinois Public Media. It is public radio for the farming world online on-demand at willag.org. Todd Gleason's services are made available to WILL by University of Illinois Extension. July corn in Chicago at the CME Group finished at $4.68 and a half today, 11 and a half cents lower. December down 10 and a half at $4.90. July soybeans $11.94 and three quarters, down 16 and three quarters of a cent. New crop November beans at $11.75 and a half, down 14. And Soft Red Winter Wheat down 10 and a half cents.

01:30 Ag Markets with Greg Johnson

Todd Gleason: Greg Johnson from TGM, that's totalgrainmarketing.com, now joins us to take a look at the marketplace. Hi Greg, thanks for being with us. Monday we had a good day, yesterday was a Turnaround Tuesday, though it apparently has spilled over into a Wednesday. Can you tell me about this marketplace, please?

Greg Johnson: Basically, we've got the weakness in the crude oil market weighing on all the other commodities with the exception of gold. There's rumors that the US and Iran are close, once again, to coming to some kind of an agreement in the Middle East. We will see, but it must be believable enough that we've got crude oil prices down about 7%, which is like $7 to $8 a barrel. It was down as much as $13 a barrel in the overnight session. Right now, we're currently down about $7 to $8. And that has pressured corn and soybeans. Corn down roughly 10, beans down roughly 18 to 20. So, just some pressure from the outside markets, basically the crude oil market on the Middle East news is what's ruling the market under pressure so far today.

Todd Gleason: And down in sympathy. When that happens, what kind of bounce back do you expect, if any at all?

Greg Johnson: Well, that's when you start looking at charts and seeing where we're at in the big picture. And we made new contract highs in both corn and soybeans this week. So, you know, we've gone up quite a bit. I think corn had an eight-day winning streak before yesterday. We broke that eight-day winning streak, and so now we're down two days in a row. Soybeans not quite as good, but, you know, the contract high we hit December corn got all the way up to $5.05 on Tuesday. And now we're at $4.90. So the bad news is we're 15 cents off the high, but the good news is we're 45 cents off the low. The average price that we've had so far this year on December corn is $4.75, and we're at $4.90. So I would argue it's still not a bad place to sell some corn. We've still got a long ways to go. Not off to the greatest start—some places are completely done planting corn, others are, you know, trying to get in the field to get corn planted. So we've got a long ways to go. We probably will get more opportunities, but I think this is just a good reminder that when we see something approaching $5 on corn or $12 on beans, you have to think long and hard about why you're not selling commodities at those prices assuming that we're going to have a normal crop. And on May 6th, I think you just have to assume that we're going to have a normal crop. It probably won't be a bumper crop, it probably won't be a terrible crop. You just have to assume normal, and if you assume normal going in with a 2.1 billion bushel corn carryout, we may get it down to 1.8 or 1.9, but that's still plenty of corn. And so, if we're not going to run out of corn, you have to market that grain at some point in time.

Todd Gleason: Now there was a moment in our not-so-distant past where South America, particularly corn coming out of Brazil, that second crop corn—which is now in the ground growing, has been doing very well, Safrinha crop—mostly all was exported out of that marketplace, though the rise of ethanol usage there made from corn (it has been made from sugarcane for a long time) has really been taking some of that out of the marketplace. All in all, I guess it still means that the United States is the behemoth on the world stage as it's related to corn, and farmers probably should consider that as they're thinking about their marketing. And if we have an average crop, we'll have to think, well, we'll have an average price.

Greg Johnson: Exactly. And, you know, last year was a pretty good example. The yields in the Eastern Corn Belt were average to below average slightly. But in the West, they rang the bell. They had record yields. So we're still seeing the after-effects of that. Basis levels for old crop corn and beans in the West are very much weaker than what we're seeing for basis levels in the East. So that reflects, you know, a relative shortage of old crop corn and beans in the East. And again, looking at the big picture, it's not that we don't have corn or beans anywhere, it's just that they're located primarily west of the Mississippi River, and that's why basis levels are very, very good here in the East and not as good in the West. But big picture, I think we still have plenty of corn, beans, and wheat.

Todd Gleason: And they rang the bell. I suppose they don't do that very often in the western part of the United States, at least past Iowa. And that has caused some serious issues there. That hasn't backed up really for the basis into the East, though. Sometimes it does, and it's just not at this point, I guess.

Greg Johnson: No, I mean, I would say everything's just kind of average. I mean, we're very close to the levels we were last year at this point. So even with a smaller crop here, some of that is being offset by corn being moved from West to East. So overall, we're just looking at average basis levels, average prices, and average yields at this point.

Todd Gleason: What are you watching in soybeans at this time?

Greg Johnson: Well, Mr. Trump and President Xi get together next Thursday and Friday. That's going to be the big news. That'll probably be one of the next big market movers. The trade is hoping for an extra 8 million metric tons of beans to be purchased. I'm a little skeptical of that. The press release that I read said that Trump was going to encourage China to buy more US commodities, not specifically soybeans. So I wouldn't be surprised if the meeting results in China buying more sorghum, for example, or maybe even corn. I'm not sure about soybeans. The Brazilian crop was huge, record soybean crop out of Brazil. Their beans are probably 75 cents cheaper right now than US beans, so unless China wants to do something as a political gesture, goodwill gesture, economically they're better off buying beans out of Brazil because they're just cheaper right now.

Todd Gleason: That brings me back to the Persian Gulf, the war with Iran. Do you suppose the one-pager that the Trump administration and Iran are working through that lays out basics of, well, we're going to wait on these things, and we have 30 days, I think, that's what it appears to be, to work them out, is just a pause going through the US and China meeting mid-May, and then we might pick up with issues again?

Greg Johnson: I think there's a lot of negativity on the US getting involved in the Middle East again, and so if there's a way out, I think there's a fair amount of pressure on President Trump to find an exit strategy and off-ramp to get out. Otherwise, this could take weeks, months, if not years. So I think, I think that's the way we're leaning right now. The market is leaning towards, you know, if there's a way out of this that both sides can exit gracefully, I think both sides would like to see that happen. So that's kind of how we're leaning today, but as in the Middle East, things can change on a dime, and so tomorrow's headlines might be something different, but today it feels like we're getting closer to an agreement, not farther apart.

Todd Gleason: The market is signaling, please make an agreement, and we will go along.

Greg Johnson: Exactly.

Todd Gleason: Thank you much, Greg, we appreciate it. Greg Johnson is with TGM, that's totalgrainmarketing.com.

09:58 Asking County Boards to Site Data Centers is an Unfair Thing

Todd Gleason: If you were listening to this program yesterday, you probably heard a representative from Google lay out the case for building out data centers and answering questions about how these impact local electric rates, water supplies, and noise levels. Illinois Public Media's agriculture and environment reporter, Abigail Botar, and I asked University of Illinois agricultural policy expert Jonathan Coppess if he had thoughts on this matter. Here is that conversation. What should county boards be considering when they're asked to site a data center?

Jonathan Coppess: So, first off, this isn't fair to put on a county board. This data center thing is a horrendous problem. Building it on farmland is one of the dumber things we can do, since you can't eat computer chips. Like, we… this is a societal issue that we need to be discussing, and honestly, I think there's a good reason to put the brakes on until we figure out what we're doing and what these things are doing. So, it's not fair to put this on a local government, but certainly, zoning regulations can be used and can help. Of course, the pressure on a local government is extraordinary. But the amount of land that these take up, the amount of water, and the enormous electricity costs these things… I think one of these things is the size of a city in its electricity demand. And so then me, as a consumer paying for electricity, I have to pay more so that they can profit off of this? I… this is… this sort of has this kind of out-of-control feeling, as if it's "we're going to wake up someday and go, why did we not stop that earlier? Why didn't we slow this down a little bit?" So I think zoning, particularly selfishly agricultural zoning, anything to keep this off farmland, and not… I mean, once you build a data center, that data center's maybe good for a few years, farmland's ruined forever. You never get to grow a crop on that again. And so I just… I think there's a whole lot of these questions that are really difficult, that we as a society should be talking about, and thinking about, and I think we're going to have a lot of regret if we just allow this unchecked build-out and consumption of land and water and electricity.

Todd Gleason: Do you think legislation like the Power Act in Illinois, do you think that's the way we should be moving forward with this?

Jonathan Coppess: I mean, I think it's better at the state level to try to slow some of this down and try to take the pressure off some of the local governments. I'm not familiar with all the terms of the Power Act, I actually have a student that's looking into it, so I'm fascinated to see what she comes away with. But I do think it's a really difficult thing even for states. Water flows, electricity flows across state lines, so you know, Illinois can only do so much. But it is a better place to be considering land use type questions like this. But ultimately, this is going to have to be a federal question. They'll have to slow it down fast, or there'll be a lot—there already are many data centers that have been sited. Yes. I say all that realizing that, like, yeah, it's... we're way behind. Way behind on this issue. Which comes back, Todd, to your point, like, we're putting this on a local government to have to sort out, and my word, I don't know how... how you deal with that at a zoning commission hearing, or a zoning board issue, or a county commission. I mean, you got these companies with hundreds of billions of dollars in cash, and they are promising the world. How do you... yeah, I don't know. It is an unfair thing to put on a local government to try to sort out.

Todd Gleason: That was Jonathan Coppess from the University of Illinois. We were joined by Abigail Botar, ag and environment reporter from Illinois Public Media. This week, we're exploring the siting of data centers. You may find our conversation on this topic with a representative from Google in yesterday's May 5th edition of the Closing Market Report.

14:05 Pope Leo's Food Waste Petition and Prayer

Todd Gleason: Generally, I do not mix my faith and my job here on the radio station. But something struck me a little different at Mass on Sunday. I'm a Catholic, and like many faiths, there are intentions or petitions that are read aloud for the congregation to pray for during the week, or in this case, during the month. The language in one of these was really strange to me, because it sounded very much as if it came from the ag industry, or some other place. I'll read it to you: "Let us pray that everyone from large producers to small consumers be committed to avoid wasting food and to ensure that everyone has access to quality food." It was the large producers and small consumers that really threw me in this, so I asked where it came from and then tracked it down. It actually came from Pope Leo XIV in Rome.

Pope Leo XIV: Lord of Creation, you gave us the fertile earth and with it our daily bread as a sign of your love and Providence. Today we recognize with sorrow that millions of brothers and sisters continue to suffer from hunger, while so many goods are wasted at our tables.

Todd Gleason: Well, that's just a portion of a video the pontiff has posted about food waste. It triggered, frankly, in my mind, a program ADM has funded here on campus called the Institute for Post-Harvest Loss. It focuses on reducing global grain and oilseed waste. The aim is to improve food security by developing technologies to manage post-harvest losses, particularly for smallholder farmers, and serve as an information hub for research and education. Now, post-harvest loss accounts for about 20% of grain and oilseed production across the planet. Think of it as the corn that goes out the back end of the combine at harvest, or just mismanagement of storage of wheat, corn, and soybeans. At the dinner table, we can all do better at maybe eating a little less of what's in front of us, and/or finding ways to use what's left later for another meal.

16:25 Ag Weather with Drew Lerner

Todd Gleason: Let's turn our attention to the weather forecasts for the growing regions across the planet. Drew Lerner is here with World Weather Incorporated in Kansas City. Right away, Drew, I'd like to start in your part of the world, actually a little further to the west, I suppose. But in the Hard Red Winter Wheat growing regions, it appears that it's going to be pretty cold overnight tonight. What kind of issues might we be facing?

Drew Lerner: Yeah, you know, you can only kill a crop so many times, I think. But I don't know, we're gonna try it again. Tonight, we do expect the temperatures to get down below the damage threshold in western Kansas, and that's probably the area that's most likely to see damage. There could be a little bit in Colorado too. According to the USDA this past week, 70% of the wheat is headed in Kansas, and some of the west-central counties in the state are kind of about half headed. So that's kind of good news, but you know, with wheat in the boot, damage can begin at 28 degrees for a couple of hours, and for headed wheat, it's 30 degrees for a couple of hours. So, we're going to be seeing temperatures tomorrow morning in the middle and upper 20s in western Kansas, and that's probably going to be the western one-third of the state, with central parts of the state upper 20s, lower 30s. Colorado, my goodness, Colorado may see some temperatures get down close to 20 degrees. And, but Colorado's crops, there's none that have reached the heading stage, but they are certainly well into the joint and perhaps there's a little booting going on. Now, we are getting rain out there right now, rain and snow both, and there's been some folks who keep focusing on the fact that there might be some snow on the ground in Colorado at least. But, you know, at this time of the year, the wheat's pretty tall. It's gonna be pretty hard to protect the whole crop. And so I think those crops that are in Kansas that may be booted or in the heading stage are going to be completely vulnerable. Now, we are going to keep the rain and snow falling until probably mid-evening, and then we're going to start a clearing trend. So I don't think it's going to be absolutely clear in all these areas until midnight or shortly after that. So there's going to be a fairly narrow window for the temperatures to fall, and for that reason it may not get quite below that damage threshold for long enough to cause a lot of widespread damage. So we're going to be watching this real closely overnight tonight. I expect a little bit of damage, but it's probably not going to be a big disaster.

Todd Gleason: I want to stay in the West, but stay in the Western Corn Belt at this point. Nebraska, just one state north of Kansas, has been really dry. Are conditions changing there at all?

Drew Lerner: Well, I think they will. They haven't changed greatly. This disturbance that's occurring today in Colorado and Kansas is clipping the southwest corner of the state, but there really isn't much moisture in the heart of it. There will be a little disturbance coming in from Montana over the weekend that will bring some more showers and thunderstorms to Nebraska and maybe another opportunity for rain in the second week, maybe somewhere towards the end of next week. But right now, I wouldn't necessarily get too excited about widespread rain there. Enough moisture maybe to help the crop deal with the dryness, but it definitely needs to rain more than what we're seeing on the charts right now. Maybe a little bit later in the month and in early June, but I think unfortunately the greatest rains during that time period are probably be Northern Plains and southern-most parts of Canada's Prairies.

Todd Gleason: In the heart of the Midwest, farmers would like a little less rainfall, at least for a bit, and mostly they'd like much warmer conditions. Is that in the offing over the next week?

Drew Lerner: Not in the next seven days, but in the second week of the outlook, yes. We will definitely warm up. In fact, most of the key US crop areas will be at the end of this long period of cool weather and start a notable warming trend. And but this first week stays pretty chilly. We're going to see some frost and some freezes in the Midwest too, but those are going to be mostly up in the north and not necessarily in wheat areas.

Todd Gleason: And then turn your attention to the problems they have been suffering in parts of Brazil as it's related to the Safrinha or second crop corn and dryness there.

Drew Lerner: Yeah, the... I'm going to split the Safrinha corn production area in half here to talk about the north and the south. The southern parts of Safrinha corn country have been quite dry. They did get a little relief about a week or so ago, maybe a week and a half, and that bought them a little bit of time. I think parts of Paraná and Paraguay as well as Mato Grosso do Sul got a little bit of moisture out of that, but it's still drier than it should be today. And there is a strong cold front that will be cutting through those areas tomorrow night into Saturday. And there should be a band of slow-moving strong thunderstorms that will produce maybe one to three inches of rain across nearly all of Mato Grosso do Sul, Paraguay, and Paraná, and maybe into a small part of São Paulo as well. So there's going to be a very nice event. And what's interesting is that behind this is another opportunity for rain possibly. This would occur around mid-month. I'm not totally convinced that it will verify as it's shown today, but there will definitely be some follow-up moisture. So the southern Safrinha crop areas are going to do all right. Now, up in the north, Mato Grosso and Goiás, of course, they are the most important production part of the region, and they are not seeing much rain as you would not expect at this time of the year. It will continue to be generally dry up that way. We do have a few showers that will come with this disturbance this weekend, but I don't believe we're going to see enough rain to make much difference there. So they're going to continue to dry down as they usually do, and the moisture profile is short to very short on moisture. So I'm thinking that a little crop stress, maybe shaving down some of the yield up that way is probable.

Todd Gleason: Hey, thank you much. We'll talk with you again next week.

Drew Lerner: You bet.

Todd Gleason: Drew Lerner is with World Weather Incorporated in Kansas City. He joined us on this Wednesday edition of the Closing Market Report. It came to you from Illinois Public Media online on-demand anytime you'd like at willag.org. It is public radio for the farming world. I'm University of Illinois Extension's Todd Gleason.