May 08 | Closing Market Report

cmr260508

- Ag Markets with Mike Zuzolo
- Power, Politics, and Pushback on Data Centers
- Ag Weather with Eric Snodgrass

Todd Gleason: From the land-grant university in Urbana-Champaign, Illinois, this is the closing market report. It is the 8th of May 2026. I am Extension's Todd Gleason. Coming up, we will talk about the commodity markets with Mike Zuzolo of globalcommresearch.com out of Atchison, Kansas. Mike joined us for our Commodity Week discussion as well, along with Gareth Toy of agtradertalk.com. You can stay with us for the whole hour on our home station to hear all of that program. If not, it will air on many of these radio stations over the weekend, and it is up online right now at WILLag.org. Today, we will also talk about power, politics, and pushback. How residents have been sounding off on data centers is the third in a series of reports you have heard this week on the Closing Market Report. Then we will turn our attention to the weather forecast with Eric Snodgrass from Nutrien Ag Solutions and Agrible. Todd Gleason's services are made available to WILL by University of Illinois Extension. July corn settled at $4.71 and a quarter, three and three-quarters higher. December at $4.93 and a half, up four. July beans $12.08, fifteen and three-quarters higher, and November up sixteen cents at $11.89 and a half cents a bushel. July soft red winter wheat at $6.19, up six and three-quarters, and the hard red July at $6.75 and three-quarters, eight and a half higher.

01:25 Ag Markets with Mike Zuzolo

Todd Gleason: Mike Zuzolo of globalcommresearch.com out of Atchison, Kansas, now joins us. Mike, thank you for being with us and for doing Commodity Week yesterday. It was a really good program; people need to stick around and listen to it. I have some questions for the day. Soybeans are up fairly sharply for the day. I want to know what is behind that move, and then I have some follow-ups.

Mike Zuzolo: Two big things. One was the return of the energy markets and the dashed expectations heading into the weekend that Iran and the United States were going to get anything done concretely before Friday's close in terms of elongating and continuing with their peace process. That in turn soothed the higher likelihood of the Trump-Xi meeting next Thursday and Friday in China. The trade did not get what they wanted with the energies, which gave bean oil the ability to go higher. Also just as importantly, the trade is baking in prices. The summit is not only happening, but from both traders and Chicago news sources in Asia, there is a lot of talk about China giving what one news service called trophies to the United States: aircraft orders and soybean orders. I think there is an element of soybean premium being pushed in on Friday's trade from those two areas especially.

Todd Gleason: I want to talk a little bit about soybeans. I am not sure it is quite there, but aviation fuel is in short supply across the United States. Refiners here have really pushed to get more aviation fuel through the refineries. Kerosene normally is what we think of as aviation fuel. It can be made from soybean oil. Aviation fuel can also be made from ethanol. There are two different products and two different ways. I am wondering whether the renewable volume obligations for renewable diesel and the push that the oil industry has had to meet aviation fuel needs here in the United States and in Europe, both because it is being exported, will push soybean oil. Is that part of the reason soybean oil could take off through this process? I am trying to understand what the market looks like.

Mike Zuzolo: This is a tough one, and in the limited time we have, I think you are definitely on the right track from the analysis I have done. The two biggest things to watch right now are that given we are still hitting $3 a bushel and hitting what I see as records and crushes in terms of profitability, you are definitely on the right track in the short term that this will continue to help soybeans more than corn. What I am picking up, however, is that distillates and jet fuel, in particular globally, are being rationed at a much higher rate than anything else out there at this stage. We do not know how bad the demand destruction will be when this is all over. I will give you a quick number: diesel outflows from Asia, exports going out of Asia in the month of April, hit a record low of 3.9 million tons. That was down 42% from the prior month. We are literally shutting down diesel exports and ramping up biofuel domestic capacity in Asia, especially because that is where they are hardest hit. I see this as a situation where we could go a little bit longer. I also see that Argentina bean oil prices are at 10-year lows right now. There is a huge arbitrage that needs to be done. It is like European natural gas and U.S. natural gas. It is like wheat and crude oil. There is a lag here that includes what kind of demand destruction we are under. I would say sustainable aviation fuel has its day in the sun, but we are probably killing a lot of demand right now.

Todd Gleason: We have to watch it and act quicker sooner rather than later at some point.

Mike Zuzolo: I think so, and like 2011 with the Arab Spring, we will get into that food versus fuel debate, and I bet bean oil will be right in the center of it, whereas with ethanol, corn and sugar are split up enough worldwide I do not think we will get into that big of a debate.

Todd Gleason: What else have we been watching this week?

Mike Zuzolo: It was a week of expectations. The market expected the wheat to get rain in the hard red wheat belt. They expected the soybean rally to go higher because of the China summit we talked about. They expected the crude sell-off. I think we are going to have to come back and readdress all three of these issues. As I close this week out, I am going to say to clients this weekend that I see crude oil and wheat supplies dropping faster than demand. That is the heart and soul of the Commodity Week program this week.

Todd Gleason: We will listen to that in just a bit. With about 30 seconds left, is there anything on Tuesday's USDA WASDE reports?

Mike Zuzolo: I am looking for a wash from corn and beans. I think USDA will take a pass on the acreage base for corn and beans because they are readdressing that at the end of June. I do not know how they could move the export numbers much with this summit coming up. I think it is really up to the wheat. The wheat market could see lower acres and lower yield based upon crop conditions, weather patterns, and what USDA gave us on the March acreage report. Is wheat still the leader to the upside? I think so. I hope USDA agrees.

Todd Gleason: We will talk with you again next Friday and talk about those reports and whether a summit took place or not. Thank you.

Mike Zuzolo: Looking forward to it. Thanks, Todd.

Todd Gleason: That is Mike Zuzolo. He is at globalcommresearch.com out of Atchison, Kansas.

07:36 Power, Politics, and Pushback on Data Centers

Todd Gleason: This week we have been talking about data centers quite a bit. Tuesday, we had a discussion with a representative from Google about data centers and how they view their impact on the local economy and the environment. On Wednesday, we heard from an ag policy expert at the University of Illinois in the College of ACES, Jonathan Coppess, about how he thinks county boards really are not very well equipped, or even the right place, to manage siting of data centers or at least the land use sides of it. Today, we will hear from Logan County, Illinois, where a proposed 500-megawatt hyperscale data center has sparked a lot of contentious debate between economic development and community preservation. A Florida-based company, Hut 8, is looking to build a facility there in Latham. It is a project the county board is still considering for its potential to generate significant tax revenue. Local residents are concerned over the massive electrical power consumption, environmental impacts, and what they say is the lack of long-term testing. I sat down with Lincoln resident Allison Isley on the steps of the Logan County Courthouse after a protest there. We took some time to discuss why she is pushing back against the development.

Allison Isley: My name is Allison Isley. I am a Lincoln resident and a stay-at-home mom. I am here because I want to make a difference in my community and what my kids grow up with. I do not want them to grow up with the effects of something that frankly is untested in the long term.

Todd Gleason: You are here because Logan County is trying to figure out whether they would like to put a data center outside of Latham, Illinois. It has been offered by Hut 8, a company out of Florida. Data centers are big. By their own report, they can produce a lot of tax income. Why do you oppose it for Logan County, which has 11,000 homes? This place will use a 500-megawatt facility. It is going to be the equivalent of 360,000 homes. We currently have 11,000 homes in Logan County. What is it about this potential economic power that really bothers you?

Allison Isley: Data centers as we have known them for over a decade have been much smaller affairs. They are limited to one building or even a room somewhere, requiring a negligible amount of power that has not drawn the attention of anybody. What they are talking about is a hyperscale data center. These types of data centers have only really been appearing in the last two years. We are talking about an extremely large project that requires an absolutely mind-boggling amount of power, with no full guarantee that it is actually going to be able to withstand the test of time, provide that money, or be what they promise it will be. Communities that get these data centers are seeing power increases, according to the University of Michigan, of between 20 to 40 percent. I came here because the cost of living I could get here is amazing. I have a wonderful life for my family that I can afford much more here than I could in the city. To see someone want to come in and take that away from us is incredibly disappointing.

Todd Gleason: If the crux of the matter is that you moved to Logan County because you liked the slower pace of life and the lower cost of living, the county board is elected to manage the finances of the county. Those two are at interesting odds to one another because they are doing what they were elected to do, depending on the population, which is find a way to grow Logan County.

Allison Isley: That is a fair point, and I know one of the arguments I have read is that they are going to build it somewhere. Your power is going to go up anyway, so it might as well be here. I understand that. But I also see a piece of Logan County, the people next to Latham, being the most affected. It is right outside of town for them. It is going to be both an eyesore and I did not even get into the noise complaints that come out of these things. The generators they are running are the size of semi-trucks, and some of them have as many as 20. To me, I keep seeing them walking in, selling weird numbers. There are environmental concerns, noise complaint concerns, quality of life concerns, and the AI bubble is a concern. For the equivalent of a Walmart's worth of employees, it does not feel like a wise investment. Then they act like they want to welcome this so we can be a center for something like this so people want to come here, but we go back to Virginia, which has a huge influx of that, and they saw their power bills go up. At what point is that worth it? Nobody can afford to live there. It does not matter if you work there; we will all have to live somewhere else. It is just a very frustrating thing to see. The problem also is because it happened so fast, nobody totally knows the long-term implications of any of this. They keep talking about this closed-loop system, but anytime I have tried to look into it, I cannot find any that have really put it into use long-term. There is the concern that it might not even work for a project this big. Will that system work out, or will they start and then have to swap over to using our water table? Will it leak all over the place? No one can answer all the questions, and if we cannot answer the questions that could have long-term lifetime implications, why are we rushing into it?

Todd Gleason: What did I not ask that you wanted to talk about?

Allison Isley: You mentioned that the board is technically doing their job in terms of trying to grow the county. I think the thing that has bothered me the most has been how it is all run out. It has not felt like they have come around trying to court the community. While they do it, they have been doing it in the greasiest way possible. They opened their first meeting with, "Who here has a cell phone?" It is 2026, and I know we are all small-town folks, but we all got a cell phone. They opened right off the bat with the attitude that we are all just a bunch of dumb hicks that were not going to know any better, would not put up a fight, and would not do our research. That really bothered me. There are a lot of wonderful smart folks here who deserve to be listened to and deserve the time put in. Anyone who tries to present information usually gets talked down to. They have made a lot of statements like, "You are just a Democrat and you do not agree with me because I am a Republican." As we saw tonight, it is not. I go to these meetings, and there is a fellow with a MAGA hat in one corner and a liberal-minded folk in the other corner, and I am standing in the middle, and I just want to see my county taken care of. I want my children to grow up here with clean water, good land, and decisions being made for them that will benefit them in the long term.

Todd Gleason: That was Lincoln and Logan County resident Allison Isley outlining her opposition to a proposed hyperscale data center. This is the third in a series of interviews you have heard this week during the Closing Market Report. The first was Tuesday with Google, then Wednesday with a governmental policy expert, and today. You may listen to all three of them on the WILL website at willag.org through Tuesday afternoon of next week. Look under the podcast tab where you will find a rolling six Closing Market Report programs.

16:54 Ag Weather with Eric Snodgrass

Todd Gleason: Let's turn our attention to the weather forecast for the growing regions across the planet. Eric Snodgrass is here. He is with Nutrien Ag Solutions and Agrible. Eric, in our hometown and a lot of the Midwest in fact, it has been a pretty cool April after a very warm March. Tell me about the conditions we have had through that month and the beginning of May.

Eric Snodgrass: We have certainly started off the month of May quite cool, and there have been numerous frost events across crops that have already been planted. I am thinking about Nebraska, sections of Missouri, parts of Iowa, Illinois, Indiana, and states north of that. We have seen multiple shots of colder air come through, and it has been problematic to start this new month after pounding on the heat for so long in March and April. I have good news. We just need to get past this weekend and through early next week, and I think we are going to start to see a nice resurgence of warmth coming back in from the west. It could be such that we finish the end of May on a very warm note. We will split the month: cool to start, and then warm to finish. That is good. To put heat on this young crop is exactly what we want to see here. Yes, it has been quite chilly, and these frost events I am sure have caused some problems throughout parts of the western and northern Corn Belt.

Todd Gleason: We are going to dry out through that period so farmers can finish putting the crop in?

Eric Snodgrass: Let's use the word drier, not dry. The reason I say that is overall we have a slightly drier than normal outlook, but our problem especially across parts of Illinois right now is that we have had so much rainfall as of late that any additional rainfall can cause delays. I was talking to Matt Bennett yesterday, and he said if the forecast says a quarter of an inch or less, it is not going to knock me out for half a day; it is going to knock me out for two days because of how saturated the soils are right now in certain places. We need to get the warmer, windier conditions back in place to dry things out a bit so we can finish up the planting. The problem with going over dry and bringing in heat right away is that we are going to put a crust on the top of this soil, which is not ideal either. I ran some analysis on April's winds, and across central Illinois, we were almost two full standard deviations above the average on our wind speeds in April. We saw some big dust moving across the state, and soil being blown quite easily here just in the last week. We are the hotspot for very windy conditions in the month of April across the entire Lower 48.

Todd Gleason: This is the fourth year in a row in the state of Illinois that we have had dust storm warnings issued by the National Weather Service. That is a note. No good reason to have conservation tillage going on across the state. Look forward into the summer months. What are you thinking about?

Eric Snodgrass: May is going to be critical. I want to watch how this El Nino develops, what happens with the very warm water off the West Coast of North America, and the Gulf of Alaska. As you and I have talked over the years, we know those are the key spots to watch in May and June to determine what the weather patterns will be. The big news is going to be about this El Nino in terms of what folks are talking about, because right now the European model has 40% of its forecast ensemble members predicting an historic El Nino event, stronger than we have ever observed, with observations going back to the 1800s. The model is trying to predict ocean temperatures between three and four degrees Celsius above normal. The trouble is that is unprecedented, so I cannot easily reconstruct historical analogs and say we should expect this. Most forecasts are already keeping the exceptional heat much further to the west. I do not necessarily agree with that. I think a lot of North America will likely spend the summer on the cooler side of average. That does not mean we will not have heat; I am just talking about a lack of long-duration mega heat waves. I just do not see it as of right now. As much attention will be paid to this El Nino by the time we are talking one month from now, we will drop that conversation and go straight to the Gulf of Alaska because if it gets cold, that sets up a ridge over us, and we can get very hot very quickly. It is unsettled, even though we have such strong evidence of what could be a big El Nino event for this upcoming year.

Todd Gleason: Is there anything else for the summer here, or do we need to turn our attention to the growing crop in South America?

Eric Snodgrass: Let's go to South America. We will soon be hearing about the end of the safrinha crop not finishing as well as anticipated, specifically in central and eastern growing areas in Brazil. It was dry for the last 30 days, the monsoon ended, and it is not giving the crop a good drink past mid-August. It needs more moisture to finish, and they are not getting it down there. I am anticipating we will hear about the size of that crop right about the time we get the true planted acres from the USDA across the United States. Those two pieces of information will compound right before we get the summer forecasts, and I think some folks will worry about it being hot and dry here in the summer regardless of what the meteorologists say. One month from now when all this news comes out, we could be looking at a weather-inspired shock to the markets.

Todd Gleason: Alright, we will check with you about the weather next week. Thank you.

Eric Snodgrass: Thanks, Todd.

Todd Gleason: That of course is Eric Snodgrass. He is with Nutrien Ag Solutions and Agrible and joined us here on the Closing Market Report for this eighth day of May.