Oct 30 | Closing Market Report

Todd Gleason: 00:00

From the land grant university in Urbana Champaign, Illinois. This is the closing market reported as the October 2025. I'm extension's Todd Gleason. The United States and China have come to a trade agreement. We'll talk about that much more during today's program.

Todd Gleason: 00:16

We'll start with Joe Jensen, agricultural economist, helping us to detail exactly what has been hammered out or what we know of it and how it might impact the marketplace. And then we'll turn our attention to the day trade, and we'll discuss the Chicago Mercantile Exchange numbers with Matt Bennett of agmarket.net. And we'll also take a quick look at the fundamentals of the weather and how it's impacting crops in The United States and South America. We'll do that with Mike Tanorum on this Thursday 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: 00:56

Todd Gleason services are made available to WILL by University of Illinois Extension. In the last twenty four hours, president Xi and president Trump met, and they made some agreements, particularly as it's related to soybeans. The expectation is that China between now and the January will buy 12,000,000 metric tons of soybeans. I think that's about 440,000,000 bushels. And then in '26 calendar year or maybe it's season, I'm not sure, marketing year, '27 and '28, The expectation is that they will be in for 25,000,000 metric tons.

Todd Gleason: 01:39

That would be what would be about normal from them or a few years back. We're now joined by Joe Jansen. He is an agricultural economist at the University of Illinois. Hi, Joe. Thanks for being with us.

Todd Gleason: 01:52

As you were trying to make sense of the announcements that were coming out of Asia related to this agreement, what kinds of things were you thinking that it might do to the marketplace and or how it might impact trade and trade balances across the planet?

Joe Janzen: 02:09

Yeah. I think that we're still processing. This is sort of very new and and relatively relatively vague announcement. It's it's a few numbers in comments from the treasury secretary that the market has run with. I mean, it's important to note that, you know, up until about six or 7AM this morning prior to secretary Besson's comments coming out, a lot of people in the market thought that the the meeting was actually rather disappointing, and soybean prices had fallen overnight pretty substantially about 30¢ per bushel.

Joe Janzen: 02:46

All of that has been reversed, and I think there's a a sense of optimism about, you know, the potential for renewed US China trade. However, it's important to note that, I mean, like you said, this is getting back to where we were in 2022, '23, '24, not going to a higher level of US China soybean trade than, you know, than we've seen in the recent past.

Todd Gleason: 03:13

Yeah. And for this marketing year, if well, I'm reading what was actually put down, and they didn't say marketing year or calendar year. But for this marketing year, it appears it would be half that much at 12,000,000 metric tons. And I'm wondering if you put that just into the balance sheets in some way, does it change what the export numbers look like from USDA from the month of September?

Joe Janzen: 03:36

It's hard to say because you have to make a bunch of assumptions about what's gonna happen with soybean trade between The US and and every other trading partner. You would think if that all of that 12,000,000 metric tons occurred this year, that could sort of materially move the the export number on The US soybean balance sheet. But it's just as easy to think that, you know, The United States was gonna have a difficult time getting to sort of what we expected about trade maybe a couple months ago, which was about 1,600,000,000 bushels of US exports of soybeans to all countries. I think this is sort of in line with that number. It doesn't maybe move that number as much as as one might think.

Todd Gleason: 04:21

Your expectation then would be unless there is something more to this than we have seen, that the market is trading about where it has and expectations remain the same for this marketing year.

Joe Janzen: 04:33

I think that's right. I think, you know, the other part of this is just sort of the level of uncertainty. I've heard it called sort of like subscription diplomacy that, like, everything that we get in terms of, you know, news about international trade policy tends to be really short term. And I think the market is gonna need to see something material either in terms of, like, of actual date data on actual shipments over the next few months, but probably something much more concrete on paper as well in terms of an agreement between The United States and China around trade and soybean trade specifically before we really see a move to substantially different price levels than than what we've got right now.

Todd Gleason: 05:16

If that is the case, we may not see those numbers in phase one of, the trade agreement in the first Trump administration. I believe there were some numbers eventually that leaked out, but there were no numbers that were put to paper that were publicly available, I suppose.

Joe Janzen: 05:34

Well, I I think if you're going back to that phase one trade agreement, the the numbers were in part vague because they were dollar value targets that applied to all agricultural commodities, and there were sort of lots of pathways by which China could have potentially complied with that agreement. Ultimately, the thing to note about what happened during the first Trump administration was that commercial circumstances changed, and China didn't end up following through on their commitments, which didn't really have any, you know, spelled out consequences in the agreement. And that sort of seems to be likely again that we won't see an agreement that specifies what happens if China doesn't import these specific numbers stated by the treasury secretary today.

Todd Gleason: 06:20

Thank you very much. I appreciate it.

Joe Janzen: 06:22

Thank you, Todd.

Todd Gleason: 06:24

Joe Jansen is an agricultural economist on the Urbana Champaign campus of the University of Illinois. If you'd like see him in person you can do that this winter in December on the twelfth he'll be at the Farm Assets Conference and then on the fifteenth sixteenth and seventeenth at the Illinois Farm Economic Summit. Farm assets is in Bloomington. That's on a Friday. And then the following Monday in DeKalb for the IFAS series followed by Peoria and Mount Vernon.

Todd Gleason: 06:52

Then on Wednesday, Joe will kick all of those off with an outlook of corn and soybean prices. You won't wanna miss those. You'll probably wanna go both to one of the IFAS series meetings as well as the farm assets conference. The ag economist will be traveling for the IFAS series and joining me for the farm assets conference along with the crop scientist and many others. You can find the details and a way to purchase tickets for both of the conferences on our website at wilag.org, willag.0rg.

Todd Gleason: 07:24

They are productions of Illinois Extension and the PharmDoc team. December corn at the CME Group settled down 3 and 3 quarters of a cent today at $4.30 and a quarter, the March at $4.43 and 3 quarters, three lower, and the May contract down two and three quarters at $4.52 and a quarter. November beans went to a high of $11 and a penny, but settled at $10.91 and a quarter, that was up 11¢. January up 13 and a quarter. The March 10 and a half higher for the day.

Todd Gleason: 07:54

The bean meal up $6.90. The bean oil 52¢ lower and the wheat futures down 8. It settled at $5.24 and a quarter for the soft red, the hard red down nine and three quarters at $5.13 a bushel. Matt Bennett from agmarket.net now joins us to take a look at the marketplace. Hi, Matt.

Todd Gleason: 08:13

Thank you for being with us. What do you think of the close of the day and prices after such such substantial amounts of move overnight and the trade agreement between China and The United States?

Matt Bennett: 08:28

Yeah. I mean, the close, obviously, were were, well off the close, on beans anyway. You know, you're you're, $10.11 cents off, off the highs, on your front month. No. I mean, you saw no peak its head above $11.

Matt Bennett: 08:43

You know, as far as corn goes, corn close on the weak side, and, you know, we saw, you know, a 10¢ range there. But, you look over soybeans, and good lord, you know, you're looking at a a 40, 44¢ range, for November beans. So, you know, the thing is, Todd, the biggest question that I think a lot of us have, and I I feel like they're trying to tell us, you know, is are we talking 12,000,000 metric tons for this calendar year? Are we talking this marketing year? Because I know on Fox News or Fox Business

Todd Gleason: 09:17

There there was clarification on that. Okay. I'm sorry. So, there was clarification. It came from Rollins.

Todd Gleason: 09:24

It is in x, and she said this year, but it was by January.

Matt Bennett: 09:30

By June. And I've seen that. Yes.

Todd Gleason: 09:32

And then and then and then and then she was clear that '26, 27, and '28 were 25,000,000 metric tons each.

Matt Bennett: 09:41

Right. And so, you you know, if that is indeed the case and that's what gets signed, Todd, then it is a little more exciting because we're talking 37,000,000 tons of beans in the next fourteen months that we're gonna sell to China because we'd have to do 12 by the end of this year, you know, and then another 25 next year, which would be a significant improvement from zero, you know, because they just hadn't done hardly anything here yet. But, clearly, the trade was kind of in disarray. You know, overnight, the news seemed to be sparse. A lot of us were checking to see, hey.

Matt Bennett: 10:17

What is the news? You know? What are they gonna come out with? And the initial news we got is that, oh, they pledged to buy more beans, and they pledged on rare earth metals to back off of, the restrictions they were gonna impose on us. They're gonna buy sorghum.

Matt Bennett: 10:31

You know? And so we didn't know any numbers. And then whenever secretary of rescind came on and he said, hey. You know, we're talking '12, '25, '25, and '25, then the market went back up. But then I think everyone was trying to digest what specifically does this mean.

Matt Bennett: 10:48

And so if that is indeed the case, as secretary Rollins has suggested, Todd, I do think that that's certainly for the next year a supportive deal. Now '25 doesn't sound like an outlandish number, you know, for the three years. But what we've gotta also understand is we've been working overtime here. There's been a bit of, you know, people in the government, EPA, you name it. They're trying to figure out, in my opinion, a way to boost or bolster domestic consumption, you know, with our renewable fuels program.

Matt Bennett: 11:22

And with that being the case, if we've got a baseline of 25, to me, that's good news because there's nothing that says they can't buy more than that. So I do wanna see the thing signed first before I get too excited, though.

Todd Gleason: 11:34

Yeah. On both of those notes, the the South the last one in particular related to soybeans and renewable fuels. Scott Irwin and Todd Hubbs had a Farm Doc Daily article released on yesterday, Wednesday of this week. We will talk with Scott later today and use that tomorrow during the closing market report and commodity week somehow combined as it's related to what they see as really three US EPA already defined rules that should make things look very, very good for, soybean, biofuels in the future. So we'll be watching that.

Todd Gleason: 12:16

Now, other things that you're watching in the marketplace fundamentally besides what's happening in Asia, and I know it was really hard to to do. Are you looking at South America, and is there any concern there, particularly in the Center West, that that soybean crop, is under dry conditions at this time.

Matt Bennett: 12:36

Yeah. I mean, it's clearly given them a chance to make pretty good progress from a planning standpoint, but at the same time, they have been dry. And it's clearly, again, gonna be something that's gonna have to be closely monitored because one thing that we've said all along is, yes, it looks like soybean supply as far as a world standpoint goes, I would call it ample. I don't know that I'd call it burdensome. It's it's ample.

Matt Bennett: 13:01

But at the same time, that was after Brazil had a massive soybean crop this this previous year. And so if you come in here with a trade deal for The US and you know that we're actually gonna be able to sell more of our beans, which will keep our our balance sheet's gonna be pretty snug. That's about all there is to it. If that's the case and then you put on top of that a Brazilian weather issue, there's no question that this bean market could get pretty volatile pretty fast. It's already been volatile the last week.

Matt Bennett: 13:32

But, you know, typically, Todd, whenever you get up and above $11 and establish yourself there, the soybean market doesn't spend a whole lot of time in the elevens. And so when you make that transition from a sub 11 price, a lot of times you will go to a $12.12 50 type price. And I'm not trying to get bullish because as you know, I'm a little more cautious. I'm just telling you historically, that's the way that the bean market has acted in the past. So I think if the dust settles here and we do see a fair amount of purchases over the next eight weeks, I think that this bean market could be something that would be pretty supportive.

Matt Bennett: 14:08

And the last thing I wanna say on this note, things that I'm looking at is if you take November 26 beans and establish them well above $11, which they closed below today, but they've spent some time above 11 this week. You know, that is certainly going to be something to consider as far as the acreage mix this next year, especially with the demand that, just surfaced, if you will. And so, yeah, I do think that that might put a little pressure on December corn. You know? Again, that's a big if.

Matt Bennett: 14:38

But if November 26 beans, would follow this bean complex higher and it would act like it has in the past, I've gotta think that these 26 corn is probably too cheap right now.

Todd Gleason: 14:48

Hey. Thanks much. We'll talk with you again next week.

Matt Bennett: 14:51

Yep. Absolutely.

Todd Gleason: 14:52

That's Matt Bennett. He is with agmarket.net. In today's agricultural news, a senate judiciary hearing this week on higher fertilizer and seed prices produced few solutions, though there were some suggestions to help farmers cope with the high cost. American Soybean Association president Caleb Ragland told judiciary lawmakers that ASA hadn't done its own analysis of high fertilizer cost but had a few recommendations nonetheless.

Caleb Ragland: 15:25

Remove IEPA tariffs on critical inputs, machinery, and parts, which will immediately lower cost of production for farmers. Two, the 45 c tax credit and proposed RFS volumes will drive investment in soybean processing and biofuel production that needs to be finalized this year.

Todd Gleason: 15:46

But Fertilizer Institute CEO, Corey Rosenbush, stressed The United States has little control over fertilizer costs.

Corey Rosenbusch: 15:54

Fertilizer is a globally traded commodity. So while we cannot directly influence prices, we can bolster domestic supply to help mitigate geopolitical risks for our American farmers.

Todd Gleason: 16:07

But at great cost.

Corey Rosenbusch: 16:08

Fertilizer production facilities are very capital intensive, sometimes costing as much as $5,000,000,000 for a nitrogen facility or ten years to develop a potash or phosphate mine.

Todd Gleason: 16:19

US is heavily dependent on Canada for potash and China and Mexico for fertilizers. ASA's Raglan says the picture's dire without farm aid.

Caleb Ragland: 16:29

Given the state of the farm economy, targeted farm assistance is desperately needed to offset trade related losses and negative basis being experienced in many regions.

Todd Gleason: 16:40

O'Raglin says the ASA backs chair Chuck Grassley's bill for the USDA to study high fertilizer crust and make recommendations. Separately, five Republicans joined Democrats to undo president Trump's 50% duty on Brazil, a high tariff nation for US ethanol. But the senate passed measure for now is dead in the house. Senators voted 52 to 48 to end the national emergency declared by Trump in order to impose those duties. Those five Republican senators joined the Democrats in approving the move.

Todd Gleason: 17:12

Politico said it's the first in a series of three resolutions intended to stop the president's tariffs on Brazil and Canada, as well as the Trump tariffs on other countries around the planet. The vote does remain largely symbolic because the house of representatives in which Republican leadership blocked the chamber from potential votes to block the tariffs until March. And that's a look in today's agricultural news. We're now joined by Mike Tenorum. He's the president and CEO at t storm weather.

Todd Gleason: 17:54

That's tstorm.net online. Thanks, Mike, for being with us. We've got a lot of ground to cover. Let's start in South America. Begin in the northern growing regions or maybe we better refer to those as the Center West, Mato Grosso in areas.

Todd Gleason: 18:11

What's your assessment of conditions there today?

Mike Tannura: 18:14

Well, they've had an unusually dry October, and because of that they need rain. There isn't much rain on the way over the next few days, but it does look a lot stormier after that. Several cool fronts are going to move into Central And Northern Brazil, and those will then dissipate over several day periods. And because of that, we're going to see pretty good totals over the next two weeks. So we think the dryness story is going to end, and that will aid soybean planting and growth as well as first corn planting and growth.

Mike Tannura: 18:44

The story there is going to be improving as we move into the middle of next month.

Todd Gleason: 18:48

If you turn your attention further to the South, Rio Grande do Sul and other areas in Southern Brazil, how are things going in those regions?

Mike Tannura: 18:57

Well, it's a little bit of a mixed bag in those areas because if you look at Parana and Paraguay, those two regions have been pretty wet over the last month, and they're going to receive some pretty good rains from that same setup we just talked about. So it's going to stay pretty wet in both of those areas. As we move into Rio Grande do Sul, they plant a much longer variety soybean crop, and they also plant first corn. Now in those areas, things are looking okay because they haven't had a whole lot of rain over the last month, and that's allowing planting to advance. And they won't get a ton of rain going forward, but they'll get just enough to kinda keep things in check and allow planting to continue without really any major problems.

Mike Tannura: 19:39

So I think it's a little bit of a mixed story there, but basically, overall looking okay.

Todd Gleason: 19:44

Let's march further south in Argentina. What are your concerns, if any?

Mike Tannura: 19:48

Well, as you move into Argentina, the big story there is how cool it's been. They've been way cooler than normal over the last week or so. They even saw some frost in Buenos Aires on Tuesday and Wednesday mornings, and that's very late. They should not be seeing frost at this time of the year. It is going to be warmer as we move forward, but it'll still be cool.

Mike Tannura: 20:05

And because of that, we're just going to have this kind of a slow start to the planting season and the growing season just because of the lack of heat units. It was pretty wet about a week ago too, and even though there is some rain on the way, it doesn't look like it's going to be a whole lot, and the primary reason for that is because of that cool air. Cool air has less humidity in it, and when you have lower humidity values, you get less rain for the most part, and that's the situation that they're in. So they should be able to plant moving forward, but they're just going to start complaining eventually about how they want some warm weather. And whether or not that happens later in November or December remains to be seen, but at least for the next two weeks, they're still going to be in this cool setup.

Todd Gleason: 20:48

Two things to take up on The United States, the finish of harvest across the Corn Belt first, please, from east to west, I suppose, starting Ohio, and you're, then make your way out to the Plain States.

Mike Tannura: 21:01

Well, it's been raining today in Ohio, and it's also been raining in areas further to the west into Indiana and Illinois over the last couple of days. Now that whole system is exiting, and as that thing moves out, there's nothing behind it. It's going to be very dry, not only in that region, but also in the Plains and the Western Corn Belt over the next ten to fourteen days, maybe even longer than that. Yes. Of course, there'll be a shower or two here and there.

Mike Tannura: 21:27

But overall, areas of high pressure are going to dominate, and that's going to leave the entire Central US much drier than normal over the next two weeks. On top of that, the cool weather that we've been in for the last week or so is going to come to an end as we move into next week. The temperatures will once again turn way warmer than normal. We'll see high temperatures in the sixties and seventies on the plains come much of next week and into the following week. And even around Illinois, it's going to be pretty mild with highs in the fifties and sixties.

Mike Tannura: 21:57

So, you know, we're in another one of these scenarios here where it's going to be way warmer than normal, and there's really no polar air anywhere across the continent, and that's kind of what's driving this whole mild setup. Things can always change, but at this point, if we don't start getting some cold weather and some snowpack building to our north, this is something that might linger for a while. So we'll just kind of keep watching it.

Todd Gleason: 22:21

And finally, know you've been watching the hard red winter wheat growing regions of The US. Are there places that you're concerned about at all?

Mike Tannura: 22:28

Not really. If you look at rains over the last two months, they've been pretty much on the money, maybe even a little bit better than average in a lot of those areas. And even though they'll be very dry over the next couple of weeks and probably longer than that, this isn't really the time of the year to get too excited about anything, especially with some good soil moisture in place to get that crop going. So just kind of a waiting game for wheat in general, but right now, no big concerns.

Todd Gleason: 22:54

Hey. Thank you much. I appreciate it, Mike. We'll talk with you again next week.

Mike Tannura: 22:58

Yeah. That sounds great, Ted. Thanks a lot.

Todd Gleason: 22:59

That's Mike Tenora. He is with T Storm Weather, joined us on this Thursday edition of the closing market report that came to you from Illinois Public Media. I'm extension's Todd Gleason.