Episode Number
10450
Episode Show Notes / Description
cmr261002
The October 2, 2026, broadcast of the Closing Market Report, hosted by Todd Gleason from the University of Illinois Urbana-Champaign, provides updates on agricultural commodity markets, pricing trends, and weather forecasts. Market analyst Mike Zuzolo discusses the impact of macroeconomic factors—such as diesel export policies and rising bond yields—on corn and soybean prices following the recent grain stocks report. Additionally, University of Illinois agricultural economist Joe Janzen explains the typical drop in corn basis during the peak fall harvest window, noting regional differences across the Corn Belt. Finally, meteorologist Eric Snodgrass offers a weather outlook, detailing how recent heavy rains have stalled harvest progress and discussing the potential long-term disruptions caused by a historically strong El Niño pattern.
01:28 Ag Markets with Mike Zuzolo, Global Commodity Analytics and Consulting
06:50 Managing the Fall Harvest Basis Dip
09:42 Ag Weather with Eric Snodgrass, Nutrien Ag Solutions
The October 2, 2026, broadcast of the Closing Market Report, hosted by Todd Gleason from the University of Illinois Urbana-Champaign, provides updates on agricultural commodity markets, pricing trends, and weather forecasts. Market analyst Mike Zuzolo discusses the impact of macroeconomic factors—such as diesel export policies and rising bond yields—on corn and soybean prices following the recent grain stocks report. Additionally, University of Illinois agricultural economist Joe Janzen explains the typical drop in corn basis during the peak fall harvest window, noting regional differences across the Corn Belt. Finally, meteorologist Eric Snodgrass offers a weather outlook, detailing how recent heavy rains have stalled harvest progress and discussing the potential long-term disruptions caused by a historically strong El Niño pattern.
01:28 Ag Markets with Mike Zuzolo, Global Commodity Analytics and Consulting
06:50 Managing the Fall Harvest Basis Dip
09:42 Ag Weather with Eric Snodgrass, Nutrien Ag Solutions
Transcript
cmr261002
The October 2, 2026, broadcast of the Closing Market Report, hosted by Todd Gleason from the University of Illinois Urbana-Champaign, provides updates on agricultural commodity markets, pricing trends, and weather forecasts. Market analyst Mike Zuzolo discusses the impact of macroeconomic factors—such as diesel export policies and rising bond yields—on corn and soybean prices following the recent grain stocks report. Additionally, University of Illinois agricultural economist Joe Janzen explains the typical drop in corn basis during the peak fall harvest window, noting regional differences across the Corn Belt. Finally, meteorologist Eric Snodgrass offers a weather outlook, detailing how recent heavy rains have stalled harvest progress and discussing the potential long-term disruptions caused by a historically strong El Niño pattern.
01:28 Ag Markets with Mike Zuzolo, Global Commodity Analytics and Consulting
06:50 Managing the Fall Harvest Basis Dip
09:42 Ag Weather with Eric Snodgrass, Nutrien Ag Solutions
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Todd Gleason: From the Land Grant University in Urbana-Champaign, Illinois, this is the Closing Market Report. It is the second day of October 2026. I’m Illinois Extension’s Todd Gleason. It’s homecoming weekend here on the Urbana-Champaign campus of the University of Illinois. Coming up, we’ll talk about the commodity markets with Mike Zuzolo, he’s at globalcommresearch.com out of Atchison, Kansas, and we’ll hear about the weather forecast from Eric Snodgrass from Nutrien Ag Solutions. Along the way, if you can stay with us for the whole hour, you’ll hear all of our commodity week program with guests Garrett Toy and Dave Chatterton. If not, it’s up online right now at willag.org, and many of these radio stations will carry it over the weekend.
Todd Gleason: December corn today settled at $4.97 and three-quarters, four and a half lower. The March at $5.11 and a half, down five and a quarter. And May down five and a quarter as well at $5.18 and a half. November soybeans, $12.78 and a quarter, down five and three-quarters. January, six and a quarter lower at $12.94 and a half, and the March at $13.04 and three-quarters, down six cents for the soybeans. Bean meal, $5.80 lower. The bean oil up $1.24. Wheat futures, December contracts, soft red, a quarter higher at $6.83. The hard red December at $7.35 and a quarter, down two and a quarter cents. Live cattle futures, $1.70 lower for the day. Feeders down $5.20 and lean hogs up $1.20.
01:28 Ag Markets with Mike Zuzolo, Global Commodity Analytics and Consulting
Todd Gleason: Mike Zuzolo, globalcommresearch.com out of Atchison, Kansas, now joins us to take a look at the marketplace. Hi Mike, thanks for being with us.
Mike Zuzolo: Great to be with you again on this Friday, Todd.
Todd Gleason: Review with me your thoughts about the grain stocks report and then look forward into how that rolls into the WASDE release next Friday.
Mike Zuzolo: Yeah, great question. The big thing for me is I went into some hedges on soybeans ahead of the report, but for different reasons than the report itself. It was more about the uncertainty around the U.S. diesel export ban potential, which seems to be cleared up as of Friday afternoon, thanks to Europe saying that they are going to release some diesel and crude oil into the marketplace over the next several weeks. That should take the pressure off President Trump from having to put a diesel export ban in place and shock the soybean oil down and with it the soybeans, which we have seen over the course of the last couple of weeks. But the second reason is about the interest rates and the fact that those short bonds, those 10-year bonds and those yields have gotten to levels not seen since before the financial crisis, actually a couple of years before the financial crisis now. That’s really starting to get at me and reference what you and I have talked about before about a demand peak. And so in the context of the demand peak mindset, stocks came out much bigger than expected on corn, smaller—not much smaller, but smaller than expected on wheat. And that gave us about a session of buy beans and sell corn. And so the corn-bean hedge recommendation at face value, I should have done the exact opposite. But as we progressed through the week, the beans joined the wheat and the corn, going lower because of these macro factors. So I’m not a big fan of the corn report for a variety of reasons, a lot like last year in terms of the gain in ending stocks because of the loss of the residual number and off-farm commercial storage—about 62.5% of the total this year, it was about 58.5% last year on the September report. I don’t think those numbers should change that much personally.
Todd Gleason: Okay, and then if you roll them forward, what does it tell you about next week?
Mike Zuzolo: Yeah, this is where if we don’t have any harvest delays to look forward to because of the weather, and that’s what the models are suggesting as we wrap up the week, we probably, I would guess, will look at those outside markets and if we continue to worsen on those macro factors, we may still cut into the downside. We’ve got a gap in the corn about a dime below us from Friday’s close, Friday’s low area, and we’ve got a gap a little bit lower than that even in the soybeans. So I would think that the trade would come back around with the idea of lower yields as we get closer to the October 9 WASDE report, but I’m not sure they’ll do it right away at the beginning of the week next week.
Todd Gleason: What are you hearing from producers about yields?
Mike Zuzolo: Well, it depends on who I talk to. I mean, I’ve gotten pictures from Nebraska of beans sprouting in pods because of six inches of rain in 24 hours. Lincoln, Nebraska had a record one-day total this week. You take that from Amarillo, Texas all the way up to where we’re at, and it was pretty tough in some pretty big areas. So I’m hearing still, though, outside of that area, 10 to 15% less on corn, very good on beans, not sure if it’s going to be as good as last year. I think that’s where the StoneX yield increase in soybeans surprised me a little bit, so we’ll have to keep an eye on that as well.
Todd Gleason: I want to turn your attention to some of the outside influences. You talked about diesel fuel; maybe we can bring heating oil, same product relatively speaking traded at the NYMEX. However, I want to start first with the jobs report from the day which showed just 29,000 jobs put in place, a few jobs lost in July in the adjustment, and put that in context with the demand peak you discussed as we started our program.
Mike Zuzolo: I’m glad you brought that up, I’m glad we had time. The PCE data, inflationary data that we got earlier this week that the Fed chooses to look at more than any of the other inflation data, along with the weak jobs data, the PCE data being softer than trade estimates, jobs data being softer than trade estimates, would suggest that the Fed does not need to raise rates. So if the diesel prices go back down because of the Europeans, and even Russia saying if we have any leftover diesel we’ll export it now, if those things happen, why would the bond yields want to go up and therefore why would the dollar want to go up? That’s the chain reaction, domino type thing that I’ll really be watching next week.
Todd Gleason: Anything else before I let you go?
Mike Zuzolo: I think the biggest thing out there Todd right now is to choose how to hedge if the macro conditions remain bad, and that’s where you’re going to have to do a lot of basis work, a lot more than you’re used to doing probably, because of these severe weather extremes that we’re experiencing here from essentially planting all the way into combining.
Todd Gleason: Thank you much, Mike.
Mike Zuzolo: Thank you, sir.
Todd Gleason: That’s Mike Zuzolo, he is with globalcommresearch.com out of Atchison, Kansas.
06:50 Managing the Fall Harvest Basis Dip
Todd Gleason: You know, fall harvest is time-consuming, but it’s also a time when farmers need to take a moment to consider how to deal with a declining basis for crops like corn. Much of that has to do with understanding how basis acts during October and November. A researcher from the farmdoc team confirms what those on the farm already know: as harvest deepens, prices generally fade until it’s about halfway through. Here are some rule-of-thumb things they may not know. Harvest generally takes about five weeks in any localized area. Nationally, corn basis drops about 15 cents into week 42 of the calendar year. This year, that starts on Sunday, October 11th. Remember, the five-week drop in the basis varies from place to place. The size of that drop also varies. It’s deeper in prime corn country, for instance, says University of Illinois agricultural economist Joe Janzen. The average break in Illinois corn basis was 19 cents from 2010 to 2025.
Joe Janzen: Yeah, I think we find that around the periphery of the Corn Belt, that harvest basis low tends to be less. And I think you could sort of say that’s areas where a lot of grain tends to go into storage, and where the flow of grain through those locations is just less. So we find that the harvest low tends to be concentrated in the center of the Corn Belt—so places like Missouri, Illinois, Indiana—where you’re right in the main flow of grain, and it’s really difficult to sort of say, “Well, you know, grain is everywhere, no one’s going to provide a really strong incentive to deliver in normal circumstances.” And then that basis low tends to be a little bit smaller in the periphery where people are maybe more willing to sit on and store grain most of the time.
Todd Gleason: Janzen’s research, which you can read online in an article titled “The Size and Timing of the Harvest Low in Corn Basis” at the farmdoc daily website, calculates the break in basis not from a pre-harvest price, but from the average post-harvest price recovery to week 48 of the calendar year. That’s Thanksgiving week this year. His work shows significant cash price recovery starts about the time corn harvest is 75% complete. There is a graphic in the article which charts the harvest low in each of the 12 Corn Belt states. Missouri is the big loser in that regard; its break is 29 cents and comes in week 40 of the calendar year. Wisconsin’s break is just eight cents by contrast; it on average doesn’t come until week 44 or the last week of October this season.
09:42 Ag Weather with Eric Snodgrass, Nutrien Ag Solutions
Todd Gleason: Let’s turn our attention to the global growing regions now and get some weather forecasts for them. Eric Snodgrass is here from Nutrien Ag Solutions. Hi Eric, thank you much for being with us for the day.
Eric Snodgrass: Yeah, thanks for having me on, and hopefully most of us are able to listen to the show and not just have our ears constantly tuned to the hum of our sump pumps right now. So I think that’s been the biggest issue, Todd. I think most people across from a line starting in New Mexico and finishing in gosh, in New York, have just been wondering, you know, with all of this rainfall, what’s it doing to our progress, getting stuff out, and even in the plains some stuff in, but at the same time our basements and crawl spaces are going to stay dry.
Todd Gleason: There is nothing more worrisome than a sump pump going out.
Eric Snodgrass: I have three right now, Todd, because of August of this year. So I’m not messing around anymore.
Todd Gleason: All right. Okay, so we’ll come back to what the weather has been like, but let’s get the forecast for the weekend. Producers are going to be in the field if they can be. Where will that take place?
Eric Snodgrass: Honestly, because of the recent rain that came through and where our soil moisture sat before this, we’re going to be sitting on our hands for a couple of days. Now, there are guys out there that have well-drained ground that maybe didn’t pick up the heavier rainfall totals that we did see in central Illinois over the last day, day and a half, that are going to get out and go. They might have the ability to do that, but it didn’t help that it cooled off so much and we’ve had a lot of cloud cover around today, at least through the morning hours, which is what’s really limiting any quick drying after the rain that’s fallen. But Todd, the good news is that the front that came through has ushered in drier Canadian air, and the next system goes through the Great Lakes, it doesn’t really come over Illinois, and we start to see our temperatures coming up a little bit, and I think it’s going to get a little bit more breezy going forward, and all of that is a solution to the really wet conditions we’ve had right here in Illinois. So I do think that the time period coming up, we may have to wait, I’d say a grand total of three to four days before we can get into the fields. But when we do, you may have another seven days after that where we could really go hard on harvest. I’m watching a system, it’s on like October 11th or 12th, coming out of the Rockies. It may be a phantom system in the model, it may not be real, but something is there. I’m going to watch it to see if it does come across and disrupt things. But Todd, that’s not next week, that’s the week after next. So we’ve got some time where Mother Nature is going to be kind.
Todd Gleason: This is going to be good across the whole of the Corn Belt, right?
Eric Snodgrass: It is. And boy, you know, you mentioned talking about what had recently happened, I’ve got places out in Nebraska, like Lincoln picked up 10 inches of rain this past week in one day. That’s their new record. I have a spot west of Des Moines that since August 1st has picked up 30 inches of rain. So just to be clear, that’s 90% of their annual rainfall they have received in since August. You go over to Indiana, major flooding earlier in August, heavy rains that have come through, and then central Ohio has been just absolutely soaked with water. And Todd, can I ask you something about this, because I’ve been thinking about this. Am I right, and just trust me I have not done any research into this, but am I right in thinking that 2012 reshaped the way we thought about crop stress? It took us back to this fear of drought, and we probably spent the better part of a decade engineering our way out of the worry on drought. Would you say that that’s true, maybe with seeds and other practices?
Todd Gleason: Yeah, so part of that was so the corn could be grown in the western regions as well. So they were watching both, and but yeah, there has been a push for drought-tolerant crops in general, but that was as much about 2012, actually more about expanding acreage so that you could continue to be dryland, rain-fed, rather than having to use irrigation to grow crops. But your question is right, or maybe the answer to that question is yes, we have spent a great deal of time trying to make crops that can manage drought tolerance much better, and the question is how well does it manage when it’s really wet?
Eric Snodgrass: Well, and that’s the odd thing. So when you look at some of the statistics of the rainfall that we’ve seen in the second half of summer and now in fall, someone was asking me, like, why don’t the models pick up on this and really reduce yield? And I said, because in order to do that, if you’re going to use a model to predict yield, you have to have statistical evidence of this reducing yield. And you think back over the last 30 or 40 years, how often have we really seen this wet across big sections of the Corn Belt, wet Septembers like this, or even this wet of late Augusts? And the answer is we just don’t. And so there’s no evidence to say, well, this is what this is going to do, but now we’re out in the fields, you know, we’re hearing guys picking up lodged beans, we’re hearing about stalk rot, we’re hearing about all these issues, and yeah, my drier forecast is nice, but it’s not going to undo some of the problems. Am I on base with that thinking?
Todd Gleason: To the best of my knowledge, I believe you are. We’re still early, we’re still early in the harvest, and it’ll be interesting to see how producers find their crops as they come out of the fields. I know that you and I watch the social media, I know very well what that means. So we’ll have to see, and USDA’s WASDE, which is next week, and crop production report, will give us another good look at which direction that crop is going. Corn and soybean crop has been going down, expectation is for the soybean crop to actually get bigger next week.
Eric Snodgrass: Oh mercy. Okay, well, shows what I know. I’m just the weather guy, Todd. But hey, speaking of weather, let’s get back to it because I really think that even though there could be disruptions in the month of October, I don’t know that this October goes back over super wet at any time. Now that’s very atypical for an El Niño year, but then again, this is an atypical El Niño. It is so far past all of the historical records on its strength. And overall, I look at it and I say, well, we might have a couple of decent dry stretches in the month of October, but I’m very uncertain once you get past about the 18th of the month how the rest of the month is going to shape up. And by the way, if we just keep going into November, the thing that we’ll have to watch in November are soil temperatures. And if we’re going to be doing any sort of fall application, those are critical. There is an odd thing that typically happens in El Niño years where we go from cooler late Octobers and early Novembers, then into warm finishes in November and warm starts to December. That’s a signal that has shown up in historically strong El Niños, and the question is, will it happen this year? Because that could really, it could be interesting to see we might be accumulating heat units in December this year if the pattern holds the way it possibly could. So Todd, there’s been a lot of volatility, and I’m not seeing that trend down at all going forward.
Todd Gleason: South America, very quickly.
Eric Snodgrass: Yeah, so the big question is the north, there’s kind of waves in the models of drier conditions, and we just want to know if that’s going to affect planting. We all know about 85% of the crop in the center west is planted in the month of October. In the south, despite it being so wet and continuing to be wet, I just don’t understand how they’re able to make the progress they are on planting, but we’ll see the numbers and see where they get.
Todd Gleason: You know, I was thinking through as you were telling me about that, the question you were asking, and on the how well do the crops do in very rainy seasons, I think it’s important to remember that both of these crops, corn and soybeans, came out of tropical regions to begin with.
Eric Snodgrass: That’s right, yeah. That they did. But they also came out of different soils, too. So it’s a, we’ve changed that plant quite a bit.
Todd Gleason: We have indeed. Hey, thank you much. We’ll talk with you more in another week.
Eric Snodgrass: Yeah, sounds good, thanks Todd.
Todd Gleason: That is Eric Snodgrass. He is with Nutrien Ag Solutions and agrible. Joined us here on the Closing Market Report for this October 2nd, a Friday afternoon. It’s homecoming weekend, by the way. Eric’s still with me. Go Illini, right here.
Eric Snodgrass: That’s right. Please, let’s do it.
Todd Gleason: And we hope that you will join us in Champaign-Urbana as well. If you can stay with us, you’ll hear all of our commodity week program. It’s coming up next.
The October 2, 2026, broadcast of the Closing Market Report, hosted by Todd Gleason from the University of Illinois Urbana-Champaign, provides updates on agricultural commodity markets, pricing trends, and weather forecasts. Market analyst Mike Zuzolo discusses the impact of macroeconomic factors—such as diesel export policies and rising bond yields—on corn and soybean prices following the recent grain stocks report. Additionally, University of Illinois agricultural economist Joe Janzen explains the typical drop in corn basis during the peak fall harvest window, noting regional differences across the Corn Belt. Finally, meteorologist Eric Snodgrass offers a weather outlook, detailing how recent heavy rains have stalled harvest progress and discussing the potential long-term disruptions caused by a historically strong El Niño pattern.
01:28 Ag Markets with Mike Zuzolo, Global Commodity Analytics and Consulting
06:50 Managing the Fall Harvest Basis Dip
09:42 Ag Weather with Eric Snodgrass, Nutrien Ag Solutions
---
Todd Gleason: From the Land Grant University in Urbana-Champaign, Illinois, this is the Closing Market Report. It is the second day of October 2026. I’m Illinois Extension’s Todd Gleason. It’s homecoming weekend here on the Urbana-Champaign campus of the University of Illinois. Coming up, we’ll talk about the commodity markets with Mike Zuzolo, he’s at globalcommresearch.com out of Atchison, Kansas, and we’ll hear about the weather forecast from Eric Snodgrass from Nutrien Ag Solutions. Along the way, if you can stay with us for the whole hour, you’ll hear all of our commodity week program with guests Garrett Toy and Dave Chatterton. If not, it’s up online right now at willag.org, and many of these radio stations will carry it over the weekend.
Todd Gleason: December corn today settled at $4.97 and three-quarters, four and a half lower. The March at $5.11 and a half, down five and a quarter. And May down five and a quarter as well at $5.18 and a half. November soybeans, $12.78 and a quarter, down five and three-quarters. January, six and a quarter lower at $12.94 and a half, and the March at $13.04 and three-quarters, down six cents for the soybeans. Bean meal, $5.80 lower. The bean oil up $1.24. Wheat futures, December contracts, soft red, a quarter higher at $6.83. The hard red December at $7.35 and a quarter, down two and a quarter cents. Live cattle futures, $1.70 lower for the day. Feeders down $5.20 and lean hogs up $1.20.
01:28 Ag Markets with Mike Zuzolo, Global Commodity Analytics and Consulting
Todd Gleason: Mike Zuzolo, globalcommresearch.com out of Atchison, Kansas, now joins us to take a look at the marketplace. Hi Mike, thanks for being with us.
Mike Zuzolo: Great to be with you again on this Friday, Todd.
Todd Gleason: Review with me your thoughts about the grain stocks report and then look forward into how that rolls into the WASDE release next Friday.
Mike Zuzolo: Yeah, great question. The big thing for me is I went into some hedges on soybeans ahead of the report, but for different reasons than the report itself. It was more about the uncertainty around the U.S. diesel export ban potential, which seems to be cleared up as of Friday afternoon, thanks to Europe saying that they are going to release some diesel and crude oil into the marketplace over the next several weeks. That should take the pressure off President Trump from having to put a diesel export ban in place and shock the soybean oil down and with it the soybeans, which we have seen over the course of the last couple of weeks. But the second reason is about the interest rates and the fact that those short bonds, those 10-year bonds and those yields have gotten to levels not seen since before the financial crisis, actually a couple of years before the financial crisis now. That’s really starting to get at me and reference what you and I have talked about before about a demand peak. And so in the context of the demand peak mindset, stocks came out much bigger than expected on corn, smaller—not much smaller, but smaller than expected on wheat. And that gave us about a session of buy beans and sell corn. And so the corn-bean hedge recommendation at face value, I should have done the exact opposite. But as we progressed through the week, the beans joined the wheat and the corn, going lower because of these macro factors. So I’m not a big fan of the corn report for a variety of reasons, a lot like last year in terms of the gain in ending stocks because of the loss of the residual number and off-farm commercial storage—about 62.5% of the total this year, it was about 58.5% last year on the September report. I don’t think those numbers should change that much personally.
Todd Gleason: Okay, and then if you roll them forward, what does it tell you about next week?
Mike Zuzolo: Yeah, this is where if we don’t have any harvest delays to look forward to because of the weather, and that’s what the models are suggesting as we wrap up the week, we probably, I would guess, will look at those outside markets and if we continue to worsen on those macro factors, we may still cut into the downside. We’ve got a gap in the corn about a dime below us from Friday’s close, Friday’s low area, and we’ve got a gap a little bit lower than that even in the soybeans. So I would think that the trade would come back around with the idea of lower yields as we get closer to the October 9 WASDE report, but I’m not sure they’ll do it right away at the beginning of the week next week.
Todd Gleason: What are you hearing from producers about yields?
Mike Zuzolo: Well, it depends on who I talk to. I mean, I’ve gotten pictures from Nebraska of beans sprouting in pods because of six inches of rain in 24 hours. Lincoln, Nebraska had a record one-day total this week. You take that from Amarillo, Texas all the way up to where we’re at, and it was pretty tough in some pretty big areas. So I’m hearing still, though, outside of that area, 10 to 15% less on corn, very good on beans, not sure if it’s going to be as good as last year. I think that’s where the StoneX yield increase in soybeans surprised me a little bit, so we’ll have to keep an eye on that as well.
Todd Gleason: I want to turn your attention to some of the outside influences. You talked about diesel fuel; maybe we can bring heating oil, same product relatively speaking traded at the NYMEX. However, I want to start first with the jobs report from the day which showed just 29,000 jobs put in place, a few jobs lost in July in the adjustment, and put that in context with the demand peak you discussed as we started our program.
Mike Zuzolo: I’m glad you brought that up, I’m glad we had time. The PCE data, inflationary data that we got earlier this week that the Fed chooses to look at more than any of the other inflation data, along with the weak jobs data, the PCE data being softer than trade estimates, jobs data being softer than trade estimates, would suggest that the Fed does not need to raise rates. So if the diesel prices go back down because of the Europeans, and even Russia saying if we have any leftover diesel we’ll export it now, if those things happen, why would the bond yields want to go up and therefore why would the dollar want to go up? That’s the chain reaction, domino type thing that I’ll really be watching next week.
Todd Gleason: Anything else before I let you go?
Mike Zuzolo: I think the biggest thing out there Todd right now is to choose how to hedge if the macro conditions remain bad, and that’s where you’re going to have to do a lot of basis work, a lot more than you’re used to doing probably, because of these severe weather extremes that we’re experiencing here from essentially planting all the way into combining.
Todd Gleason: Thank you much, Mike.
Mike Zuzolo: Thank you, sir.
Todd Gleason: That’s Mike Zuzolo, he is with globalcommresearch.com out of Atchison, Kansas.
06:50 Managing the Fall Harvest Basis Dip
Todd Gleason: You know, fall harvest is time-consuming, but it’s also a time when farmers need to take a moment to consider how to deal with a declining basis for crops like corn. Much of that has to do with understanding how basis acts during October and November. A researcher from the farmdoc team confirms what those on the farm already know: as harvest deepens, prices generally fade until it’s about halfway through. Here are some rule-of-thumb things they may not know. Harvest generally takes about five weeks in any localized area. Nationally, corn basis drops about 15 cents into week 42 of the calendar year. This year, that starts on Sunday, October 11th. Remember, the five-week drop in the basis varies from place to place. The size of that drop also varies. It’s deeper in prime corn country, for instance, says University of Illinois agricultural economist Joe Janzen. The average break in Illinois corn basis was 19 cents from 2010 to 2025.
Joe Janzen: Yeah, I think we find that around the periphery of the Corn Belt, that harvest basis low tends to be less. And I think you could sort of say that’s areas where a lot of grain tends to go into storage, and where the flow of grain through those locations is just less. So we find that the harvest low tends to be concentrated in the center of the Corn Belt—so places like Missouri, Illinois, Indiana—where you’re right in the main flow of grain, and it’s really difficult to sort of say, “Well, you know, grain is everywhere, no one’s going to provide a really strong incentive to deliver in normal circumstances.” And then that basis low tends to be a little bit smaller in the periphery where people are maybe more willing to sit on and store grain most of the time.
Todd Gleason: Janzen’s research, which you can read online in an article titled “The Size and Timing of the Harvest Low in Corn Basis” at the farmdoc daily website, calculates the break in basis not from a pre-harvest price, but from the average post-harvest price recovery to week 48 of the calendar year. That’s Thanksgiving week this year. His work shows significant cash price recovery starts about the time corn harvest is 75% complete. There is a graphic in the article which charts the harvest low in each of the 12 Corn Belt states. Missouri is the big loser in that regard; its break is 29 cents and comes in week 40 of the calendar year. Wisconsin’s break is just eight cents by contrast; it on average doesn’t come until week 44 or the last week of October this season.
09:42 Ag Weather with Eric Snodgrass, Nutrien Ag Solutions
Todd Gleason: Let’s turn our attention to the global growing regions now and get some weather forecasts for them. Eric Snodgrass is here from Nutrien Ag Solutions. Hi Eric, thank you much for being with us for the day.
Eric Snodgrass: Yeah, thanks for having me on, and hopefully most of us are able to listen to the show and not just have our ears constantly tuned to the hum of our sump pumps right now. So I think that’s been the biggest issue, Todd. I think most people across from a line starting in New Mexico and finishing in gosh, in New York, have just been wondering, you know, with all of this rainfall, what’s it doing to our progress, getting stuff out, and even in the plains some stuff in, but at the same time our basements and crawl spaces are going to stay dry.
Todd Gleason: There is nothing more worrisome than a sump pump going out.
Eric Snodgrass: I have three right now, Todd, because of August of this year. So I’m not messing around anymore.
Todd Gleason: All right. Okay, so we’ll come back to what the weather has been like, but let’s get the forecast for the weekend. Producers are going to be in the field if they can be. Where will that take place?
Eric Snodgrass: Honestly, because of the recent rain that came through and where our soil moisture sat before this, we’re going to be sitting on our hands for a couple of days. Now, there are guys out there that have well-drained ground that maybe didn’t pick up the heavier rainfall totals that we did see in central Illinois over the last day, day and a half, that are going to get out and go. They might have the ability to do that, but it didn’t help that it cooled off so much and we’ve had a lot of cloud cover around today, at least through the morning hours, which is what’s really limiting any quick drying after the rain that’s fallen. But Todd, the good news is that the front that came through has ushered in drier Canadian air, and the next system goes through the Great Lakes, it doesn’t really come over Illinois, and we start to see our temperatures coming up a little bit, and I think it’s going to get a little bit more breezy going forward, and all of that is a solution to the really wet conditions we’ve had right here in Illinois. So I do think that the time period coming up, we may have to wait, I’d say a grand total of three to four days before we can get into the fields. But when we do, you may have another seven days after that where we could really go hard on harvest. I’m watching a system, it’s on like October 11th or 12th, coming out of the Rockies. It may be a phantom system in the model, it may not be real, but something is there. I’m going to watch it to see if it does come across and disrupt things. But Todd, that’s not next week, that’s the week after next. So we’ve got some time where Mother Nature is going to be kind.
Todd Gleason: This is going to be good across the whole of the Corn Belt, right?
Eric Snodgrass: It is. And boy, you know, you mentioned talking about what had recently happened, I’ve got places out in Nebraska, like Lincoln picked up 10 inches of rain this past week in one day. That’s their new record. I have a spot west of Des Moines that since August 1st has picked up 30 inches of rain. So just to be clear, that’s 90% of their annual rainfall they have received in since August. You go over to Indiana, major flooding earlier in August, heavy rains that have come through, and then central Ohio has been just absolutely soaked with water. And Todd, can I ask you something about this, because I’ve been thinking about this. Am I right, and just trust me I have not done any research into this, but am I right in thinking that 2012 reshaped the way we thought about crop stress? It took us back to this fear of drought, and we probably spent the better part of a decade engineering our way out of the worry on drought. Would you say that that’s true, maybe with seeds and other practices?
Todd Gleason: Yeah, so part of that was so the corn could be grown in the western regions as well. So they were watching both, and but yeah, there has been a push for drought-tolerant crops in general, but that was as much about 2012, actually more about expanding acreage so that you could continue to be dryland, rain-fed, rather than having to use irrigation to grow crops. But your question is right, or maybe the answer to that question is yes, we have spent a great deal of time trying to make crops that can manage drought tolerance much better, and the question is how well does it manage when it’s really wet?
Eric Snodgrass: Well, and that’s the odd thing. So when you look at some of the statistics of the rainfall that we’ve seen in the second half of summer and now in fall, someone was asking me, like, why don’t the models pick up on this and really reduce yield? And I said, because in order to do that, if you’re going to use a model to predict yield, you have to have statistical evidence of this reducing yield. And you think back over the last 30 or 40 years, how often have we really seen this wet across big sections of the Corn Belt, wet Septembers like this, or even this wet of late Augusts? And the answer is we just don’t. And so there’s no evidence to say, well, this is what this is going to do, but now we’re out in the fields, you know, we’re hearing guys picking up lodged beans, we’re hearing about stalk rot, we’re hearing about all these issues, and yeah, my drier forecast is nice, but it’s not going to undo some of the problems. Am I on base with that thinking?
Todd Gleason: To the best of my knowledge, I believe you are. We’re still early, we’re still early in the harvest, and it’ll be interesting to see how producers find their crops as they come out of the fields. I know that you and I watch the social media, I know very well what that means. So we’ll have to see, and USDA’s WASDE, which is next week, and crop production report, will give us another good look at which direction that crop is going. Corn and soybean crop has been going down, expectation is for the soybean crop to actually get bigger next week.
Eric Snodgrass: Oh mercy. Okay, well, shows what I know. I’m just the weather guy, Todd. But hey, speaking of weather, let’s get back to it because I really think that even though there could be disruptions in the month of October, I don’t know that this October goes back over super wet at any time. Now that’s very atypical for an El Niño year, but then again, this is an atypical El Niño. It is so far past all of the historical records on its strength. And overall, I look at it and I say, well, we might have a couple of decent dry stretches in the month of October, but I’m very uncertain once you get past about the 18th of the month how the rest of the month is going to shape up. And by the way, if we just keep going into November, the thing that we’ll have to watch in November are soil temperatures. And if we’re going to be doing any sort of fall application, those are critical. There is an odd thing that typically happens in El Niño years where we go from cooler late Octobers and early Novembers, then into warm finishes in November and warm starts to December. That’s a signal that has shown up in historically strong El Niños, and the question is, will it happen this year? Because that could really, it could be interesting to see we might be accumulating heat units in December this year if the pattern holds the way it possibly could. So Todd, there’s been a lot of volatility, and I’m not seeing that trend down at all going forward.
Todd Gleason: South America, very quickly.
Eric Snodgrass: Yeah, so the big question is the north, there’s kind of waves in the models of drier conditions, and we just want to know if that’s going to affect planting. We all know about 85% of the crop in the center west is planted in the month of October. In the south, despite it being so wet and continuing to be wet, I just don’t understand how they’re able to make the progress they are on planting, but we’ll see the numbers and see where they get.
Todd Gleason: You know, I was thinking through as you were telling me about that, the question you were asking, and on the how well do the crops do in very rainy seasons, I think it’s important to remember that both of these crops, corn and soybeans, came out of tropical regions to begin with.
Eric Snodgrass: That’s right, yeah. That they did. But they also came out of different soils, too. So it’s a, we’ve changed that plant quite a bit.
Todd Gleason: We have indeed. Hey, thank you much. We’ll talk with you more in another week.
Eric Snodgrass: Yeah, sounds good, thanks Todd.
Todd Gleason: That is Eric Snodgrass. He is with Nutrien Ag Solutions and agrible. Joined us here on the Closing Market Report for this October 2nd, a Friday afternoon. It’s homecoming weekend, by the way. Eric’s still with me. Go Illini, right here.
Eric Snodgrass: That’s right. Please, let’s do it.
Todd Gleason: And we hope that you will join us in Champaign-Urbana as well. If you can stay with us, you’ll hear all of our commodity week program. It’s coming up next.