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Jan 21 | Closing Market Report · Closing Market Report

• 0:00
  Todd Gleason: From the land to grant university in Urbana Champaign, Illinois. This is the closing market report for the January 2026. I'm Todd Gleason. Coming up, we'll talk about the commodity markets with Greg Johnson. He's at TGM.
• 0:13
  That's totalgrainmarketing.com. We'll discuss the weather too with Drew Lerner at World Weather Incorporated in Kansas City. Now all this week at Precision Planting outside of Morton, Illinois, farmers have been learning about some of the new things that PTX, that's their master brand, has developed, including some autonomous agriculture, a bolt on function for John Deere and soon to be for Fent tractors. I talk with Josh Merman from PTX about the Outrun autonomous system. You wanna hear about that right here on this Wednesday edition of the closing market report from Illinois Public Media.
• 0:50
  It is public radio for the farming world online at willag.org. Todd Gleason services are made available to WILL by University of Illinois Extension. March corn for the day settled lower at $4.21 and 3 quarters down two. The May at $4.29 and 3 quarters. A penny and a half lower in December contract.
• 1:10
  New crop down 3 quarters of a cent. The settlement price at $4.49 and 3 quarters of a cent. The March soybeans, ten sixty four and a half a bushel, up 11 and a half cents. May, 11¢ higher, $10.75. And November beans, $10.74 and a half, up 10 and a half cents for the day.
• 1:27
  The bean meal on the afternoon finished at 20¢ lower. The bean oil, a dollar 45 higher in soft red winter wheat, and the March contract at $5.00 7 and 3 quarters down two and a half. The hard red down three and a quarter settled at $5.19 and 3 quarters of a cent. Greg Johnson from TGM. That's totalgrainmarketing.com now joins us.
• 1:49
  Thanks, Greg, for being here again on a Wednesday. Tell me about the marketplace today. Why are soybeans higher?
• 1:56
  Greg Johnson: Soybeans are higher. That's basically because of a little bit of dry weather in Southern Brazil and Argentina. You know, we've been through this before during the growing season when they go five, six, seven days without rain. There's concern that this pattern could continue. And then a few days later, they changed that and put rain in the forecast.
• 2:17
  And I don't think Brazil's in much trouble right now. They've been getting enough rain that I think a week five days worth of dry weather is not, you know, that critical. Now Argentina has been a little on the dry side, so we could be, you know, trimming some yield in Argentina at this point, but there's still plenty of time to go. Argentina just got their beans planted a month ago, so there's still plenty of time. But, today, the dry weather, amongst the lack of other real news in the marketplace on on soybeans, you know, combined with the, drop that we've seen recently, I guess beans were due for a bounce, and beans are up double digits.
• 2:51
  So that's good.
• 2:52
  Todd Gleason: And there was some information, I think, that was out that China had actually completed its 12,000,000 my metric ton buy from The US or about 440,000,000 bushels.
• 3:01
  Greg Johnson: That is correct. Yes. We don't anticipate them buying much more with the world prices the way they are. China would be better off buying those beans from, excuse me, Brazil rather than US at current price levels. So, they were obligated to buy the 12,000,000 metric tons, the 440,000,000 bushels, and they've done that.
• 3:22
  But, from you know, whether they buy any more at this point is, probably less likely that they buy a whole lot more beans at this point.
• 3:32
  Todd Gleason: Can I ask, do we know when they made those purchases and whether there were really new purchases after the agreement was made, and how much of that was the case? I I I just haven't looked at the stats really to understand how how they met that 12,000,000 metric ton goal. Do you know?
• 3:53
  Greg Johnson: Good question. And the answer is they have not officially. We we see the weekly sales report on Thursday. We should continue if if these rumors are true, we should see more show up in in subsequent weeks. But, officially, they have not reached their 12,000,000 metric ton target.
• 4:11
  These are all based on private sources that, supposedly know what's going on, and they say that China has reached their obligation, but it's not official yet.
• 4:21
  Todd Gleason: Oh, interesting. Okay. On the corn side of things, what was driving the market?
• 4:26
  Greg Johnson: We had a little bump this morning. We had some export sales announcements, some flash sales to Colombia and to unknown. So, we did have corn react positively to that. We were up about 3¢ at one point. Right now, we're back at roughly unchanged for the day.
• 4:43
  The good news is we're holding $4.20 on March futures. That is a key area of support. We're about three or four cents above that at this point. So as long as we can hold above $4.20, I think most of the bad news from the USDA report on the twelfth is in the marketplace. So hopefully $4.20 can hold.
• 5:03
  Not that we're gonna see a big rally anytime soon. It's gonna take probably something closer to March when we get export or planning intentions report, something like that. But if we could just go sideways for the time being, maybe we can hold on long enough to wait for a rally later on. But right now, sideways is probably the best we can hope for in corn.
• 5:26
  Todd Gleason: Do you think that's possible?
• 5:27
  Greg Johnson: I do. I I really do. I think farmers are very tight holders of corn at this point. You know, the one big beautiful bill act raised the target price for our county, and we're and so farmers will receive a payment based on the difference between that target price and the average price for the year. So if we don't sell corn and the price would go lower, they would just get a bigger ARC County payment.
• 5:56
  If the price would go higher and farmers sell at these low levels, not only did they not take advantage of a rally in the market price, but then the ARC County payment would be lower. So there's not a lot of incentive for farmers to sell corn at this point.
• 6:09
  Todd Gleason: You know, the caveat being that they won't get that until the payment until, after the marketing year is done, and so it won't arrive until the 2026, and they'll have to wait for those dollars. Do when they're talking to you, do they have enough capital at this point? Do they have enough cash on hand to manage to wait that long, or or do they need a second tranche, I suppose, from the US government to help bridge? I'll use the bridge word for that one, that gap. They're already getting a bridge payment, but will they look to another one?
• 6:49
  Greg Johnson: Yeah. Well, the the rumor is that there may be another one. And, yes, the farmers will need, more money. They'll have to come up with some other money some way if they don't sell corn. They could sell beans.
• 7:00
  They could, take a basis contract out on their corn and get a 70% advance. Most elevators advance money on a basis contract, and that allows farmers to maintain a long position on the board. You know, the old fashioned take out a loan at the FSA office at at the CCC. You know? I mean, that's a a possibility.
• 7:18
  So, yeah, I I I don't think farmers have enough cash flow to get by without doing something, so they're gonna have to generate another source of revenue here over the next four to five months.
• 7:29
  Todd Gleason: This is the first winter. We've been in that position really, broadly across the agricultural sector in the Midwest, because of the cash flow that was available from some of the previous years where prices were really high, and so were the incomes on the farm. I would imagine that's putting some stress on producers when you talk to them.
• 7:51
  Greg Johnson: Yeah. It it's not good. I mean, farmers are, by nature, optimistic, so they're hopeful that something will change. And, but given what we have now, they may have to wait three or four months. You know, we probably will have to get into either the the growing season or start to see some acreage reports.
• 8:08
  If if the corn acres are down four to 5,000,000 acres from the 98, 99,000,000 acres we planted this year, that could be a little supportive. The dry weather, lack of subsoil moisture might get the market concerned, but quite frankly, after the last two years with dry weather, I think we're gonna have to prove to the market that we have a problem. I don't know that they're going to put a lot of weather premium in this market based on dry weather given the results we've had the last two years with relatively dry weather.
• 8:35
  Todd Gleason: And finally, two items related to you or related to the European Union, Greenland and the president's speech this morning at Davos in Switzerland. First, he said, he would not use force to take Greenland, and secondly, he was very clear that The United States wanted to acquire Greenland and they would buy it, and if he needed to use tariffs to make that happen, he would impose them. It appears the trade took that fairly well.
• 9:10
  Greg Johnson: The commodity markets took that trade that news very well. The stock market, not so much. Gold and silver made new highs yesterday. The stock markets were down not over not only over in Europe, but here in The US. So, yeah, that uncertainty did not sit well in the financial markets, but really not much of an impact on the commodity markets.
• 9:30
  Todd Gleason: That's what I was thinking. Thanks much. We appreciate it. We'll talk with you again soon enough.
• 9:35
  Greg Johnson: Alright. Thanks, Todd.
• 9:36
  Todd Gleason: Mhmm. That's Greg Johnson. He is with TGM. That's totalgrainmarketing.com. You know, as the ag industry looks to mounting labor challenges and tighter planting windows, farmers are increasingly looking toward automation to stay efficient.
• 9:55
  A new system from PTX and Precision Planting is bringing those capabilities to the tractors already sitting in their sheds. Today, we're joined by Josh Merman. He's a systems engineer for PTX OutRun. I spoke with him earlier in the week at their precision planting headquarters in Tremont, Illinois, and asked him about the OutRun system.
• 10:16
  Josh Murman: One of the key strategies we're we're leveraging as part of the OutRun program is that we're one, you know, one platform, the OutRun autonomy platform, but it can do many tasks. Now, of course, it's starting with the two tasks you mentioned. We started with the grain cart, and we're we're expanding the tillage and and we'll continue to expand that that autonomous platform portfolio. But the core technologies of all of those applications, they're all working in agricultural environments. They're all working in fields.
• 10:44
  A lot of the tasks are very similar. So we solve event based tasks like a grain cart where you you point and it goes. And we also solve coverage problems with the tillage where you preplan the whole path. And so leveraging all of those technologies together and allowing them to build together allows us to roll out the future platforms much quicker now that we have that baseline. And some of the key to that is our vision system on the machine, which does leverage artificial intelligence to detect if there's humans or other obstacles in the field and be able to react to those to give you notification.
• 11:17
  And so you can take action if if it were to come across something in the field, that it doesn't know if it should proceed or not.
• 11:24
  Todd Gleason: There were times in the early nineties when the university was experimenting with these autonomous vehicles. Very early on, cell phone might go off and the vehicle would go in a different direction. Those things have been solved quite some time ago. What are the biggest issues today that you have to deal
• 11:44
  Josh Murman: with? One of the biggest issues when we started out was was connectivity as you as you mentioned. And currently, our our technology of choice for connectivity is is the Starlink platform, and we're able to connect all of the machines in real time. And for us, that's been very reliable compared to some of the cell networks and and parts of the country are are a little bit spotty. And for something like autonomy where you really need kind of ability to see what it's doing and and look at the, you know, the images coming from the machine and be able to keep track of it.
• 12:16
  Now we very intentionally build the safety systems into the machine so they're self observing. And so we don't rely on that external link as part of the safety package for the machine operation. And so even if Starlink goes down or cell service goes down, it's able to operate safely and at least, you know, stop itself or maybe continue for a brief period of an outage. So I think having intentional decisions on how you architect the machine and so you're not dependent on those external, maybe more fragile communication links to operate safely is important. And then having those links enables you to pick back up.
• 12:54
  So say, for example, if if the connection goes down, you're you if the machine can still operate safely, you just may be inconvenienced for a minute while you don't have an image from the the machine.
• 13:06
  Todd Gleason: You don't have an image because you're remotely, but the machine It still still knows maybe where it is. That could be based on the GPS, but it could be based on the cameras, I assume, if you're trying to get it to stop safely. And it also is monitoring all the things that are happening with the engine and the mechanics on the machine at the same time.
• 13:24
  Josh Murman: Yes. Yes. So the machine is self monitoring. So we we get all of the diagnostics information off the machine. We're able to forward that to you as the producer to know if maybe your hydraulic temperature is too high or you'll able to monitor those things.
• 13:39
  We, of course, monitor if it gets into a wet spot and it's starting to spin and get stuck. We can interrupt that task and say, hey, we're we're not gonna con continue into that wet spot to bury the tractor. We we wanna say, hey.
• 13:51
  You you should probably come out and check on this thing. What are the use cases that you think farmers should consider about Run, and its total package for? There's no one size fits all for for your operation for you know, you don't have the exact same set of equipment that your neighbor does, and and that's because every operation is a little bit different, and and autonomy is gonna be the same. And so with the multiple tasks that the that the product can do, it really gives you that flexibility to say, hey. Maybe maybe I need a little bit of help during the early season harvest for my for my soybean crop, for example.
• 14:25
  Maybe maybe I can have that harvest help. But then when I get into corn, I want the the outrun system to start primary tillage right behind right behind my harvester. And so you can you can, you know, use the outrun system and and take advantage of that flexibility to get stuff done at a time where it makes the most sense for your operation and also provides you the most ROI. In our session, we talk a little bit about how early tillage can provide an advantage for your crop the next year by starting that breakdown of the stock matter and having more nutrient availability. So, you know, it's a mix, and it it really does depend on the operation.
• 14:59
  Of course, your region of of the the growing area as well of the Corn Belt or across The US.
• 15:06
  Todd Gleason: Any message, things that I missed that you wanna talk about?
• 15:09
  Josh Murman: I think the the the key for the Outrun system is is the one platform that does many tasks. It's gonna ever expand. We're just at the start of this this autonomy thing. And there's always been a lot of messaging over the past few years about get a machine that's auto ready, you know, prepare your boundaries for autonomy, all of those sorts of messaging. Well, autonomy is it can it can be mounted on your tractor, and a good technician will have it ready for that afternoon.
• 15:34
  And you're able to go out and till a field that afternoon on the machine that you already own. And so that's really the power of autonomy. It's it's not something that's off in the distance. It's something that's approachable to operations. And it's not here to, you know, say, alright.
• 15:49
  Well, now I have all this help. It's here to augment your labor operation. It's not here to, you know, take someone's job, I guess, so to speak. It's here to help help you with your operation and give you that flexibility to to take advantage of, you know, less seat time in a tractor, for example, for tillage. And now you're able to go maybe lay some tile that day or provide other high value, you know, tasks to your farm operation.
• 16:11
  Todd Gleason: When is it available?
• 16:12
  Josh Murman: OutRun is available now. So you could buy the the OutRun autonomous platform. Today, you could do the cart system. This summer, you'll be able to do tillage as a product. We're doing wrapping up our beta testing during the spring, twenty six fall or spring twenty six, planting season and tillage season, and then we'll be ready for, commercial release this this summer.
• 16:37
  Todd Gleason: Josh Merman is a systems engineer at PTX Trimble and a member of the OutRun team, you can find out more about the OutRun autonomous system that can be mounted to your John Deere tractor, Fent, coming soon at outrunag.com. Let's turn our attention to the weather forecast for the growing regions across the planet. I'd like to start in the Northern Hemisphere, Drew Lerner at World Weather Incorporated, because there's an awful lot of cold that will be spilling into The United States. And by Friday morning, I'm wondering if there's any concern as it's related to winter wheat that, has been in hibernation of dormancy, but may have seen enough warm weather that kind of started to grow. You tell me about it and what you think.
• 17:39
  Drew Lerner: Yeah. I think that the majority of the wheat and areas that will be subjected to subzero temperatures on Friday morning were crops that never really got into any kind of growth, but they did lose winter hardiness for a while. I think this past few days of alternating cold and warm weather probably has the crop trying to harden a little bit more and we will have an opportunity for seeing that a little bit as we get in front of Friday. Actually, I guess there's only one day left isn't there, but we will expect though on Friday for the temperatures to drop into the negative single digits from Nebraska into Kansas and then eastward into Indiana and Illinois and even Ohio for that matter. A lot of that region has no snow on the ground today.
• 18:29
  And the prospects of seeing significant snow before the cold arrives is somewhat slim. I mean, areas in Nebraska may do all right with a little bit of dusting of snow initially, but the rest of the region I described is going to be snow free until Friday afternoon or Friday night. And then there will be some snow that will develop. Now it's pretty hard to really hurt the wheat crop at this time of the year, even with the temperatures bouncing around like they have. And I can't get too excited about widespread serious problems, but, you know, a spot or two could end up being damaged by these temperatures.
• 19:05
  I think what is probably going to happen is we're going to have a lot of wind around on Friday as those temperatures drop, that's going to keep the air stirred a little bit. It will also buy a little bit of time for the snow to develop. And once the snow does come around, it will put a layer of protection on these crops. So I think that we have a risk of a little bit of damage, but most likely the damage potential period will be short because of the snow that should come. And I think everybody in that region should get some snow.
• 19:36
  So fingers crossed, we should be able to protect the crop enough, that we should get through this okay.
• 19:43
  Todd Gleason: Looking towards warmer climbs, the Southern Hemisphere, Argentina, and Brazil. There was a pop in the marketplace for soybeans today based on some ideas that part of that crop somewhere in South America might be a little dry, although, you know, that changes fairly quickly. What are you watching?
• 20:01
  Drew Lerner: Yeah. Today we have a strong ridge of high pressure showing up on some of the Ensemble model data and that is very important. The Ensembles do a very good job of averaging out a lot of short term model runs and it usually can smooth out all the bumps in the road and give you a little bit better idea of what's going to happen over the next ten days or so. The ridge is pretty impressive today. And I think that's one of the primary reasons why the market got a little excited.
• 20:31
  And I think it's probably justified. We already have dryness of significance in Uruguay and East Central, Antarios, and also in portions of, we'll call it Central And Southwestern Cordoba into San Luis. Now overall, it's not a large enough area to really throw the markets today. But if we add ten days of dry weather and then allow temperatures to get into the nineties over at least five of those ten days coming up, you know, it's going to become a little bit more of a significant situation. These areas that are in between the two driest regions do not have abundance of moisture.
• 21:12
  They just have enough to keep the crop going for a little bit. So once we get into the hot, dry weather, all of that moisture stress is going to expand across the entire Southern and Eastern parts of Argentina. And probably we'll make a good attempt to get a deeper into Rio Grande do Sul. Now it could come to an end at the end of the ten day period. Some of the models want to bring in rain, but I've been looking at this today and I do not feel real comfortable about getting significant rains into these areas.
• 21:43
  It should cool, and there will be some scattered showers around. But I'm not convinced that we're gonna see in days eleven through fifteen enough rain to turn the turn the bucky around a little bit.
• 21:53
  Todd Gleason: So not exactly a problem yet, but could potentially build into one?
• 21:59
  Drew Lerner: Yeah. For late season crops, you know, Argentina is still putting some of the late season crop in the ground, and Rio Grande, the sole soybeans of course are pretty late season anyway. And so those are the areas that we're going to watch. I don't know that it's going to throw the whole South America balance equation all off, but it could pose as a little bit of a problem. Keep in mind that this La Nina event is expected to see some accelerated weakening in February.
• 22:29
  So there should be a cap on how much dryness we can get out of this pattern. So I'm thinking at ten days is probably gonna be the most significant. And then after that, we will slowly work our way into something a little bit better for the crops in that region.
• 22:44
  Todd Gleason: Hey. Thanks much. I appreciate it, Drew. We'll talk with you again soon enough.
• 22:47
  Drew Lerner: Alright. Have a good week.
• 22:49
  Todd Gleason: You too. That is Drew Lerner. He is with World Weather Incorporated in Kansas City. Joined us on this Wednesday edition of the closing market report that came to you from Illinois Public Media. It is public radio for the farming world online on demand at willag.org.
• 23:05
  I'm University of Illinois Extension's Todd Gleason.