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Mar 07 | Closing Market Report · Closing Market Report

• 0:00
  Todd Gleason: From the Land Grant University in Urbana Champaign, Illinois, this is the Closing Market Report. It is the March 2025. I'm extension's Todd Gleeson. Coming up, we'll talk about the commodity markets with Mike Zuzlow. He's a globalcommresearch.com out of Atchison, Kansas.
• 0:17
  We'll hear about the Asian longhorned tick, an invasive species, and the issues it's creating for beef cattle producers in Illinois and across the nation. And then as we close out our time together, we'll discuss the weather forecast with Eric Snodgrass from Nutrien Ag Solutions. And if you can stay with us through the whole of the hour today, you'll hear all of our Commodity Week program. Joe Jansen, agricultural economist, and a member of the FarmDock team presented the fundamentals of the marketplace on Tuesday at the All Day Outlook. We'll hear his presentation in full if you can stay with us.
• 0:50
  Otherwise, it's up online right now at willag.org, and many of these radio stations will carry it over the weekend.
• 0:58
  announcer: Todd Gleason services are made available to WILL by University of Illinois extension.
• 1:03
  Todd Gleason: A Macon for the day settled at $4.69 and a quarter, up 5 and a quarter. July, 4 70 5 and 3 quarters. A nickel higher in December, up 3 and a quarter cents. Settlement price there at $4.54 and a quarter. May beans $10.25, down 2 and a quarter.
• 1:19
  July off three quarters at $10.38 and 3 quarters. And November soybeans at $10.25 and a half, up four and three quarters. Wheat futures in the July soft red, two and a half lower. Mike Zuzelow at GlobalcomResearch.com out of Atchison, Kansas now joins us. He safely made it back to the home.
• 1:39
  Had to drive through, I suppose, some rain from the all day I got look at the beef house on Tuesday. Thank you for being there.
• 1:47
  Mike Zuzolo: It was great. It was another great successful meeting. Great people, great analysis, great leadership by you and University of Illinois. I wish I could have stayed till the end. But, yeah, we had blizzard warnings in Northeast Kansas when we were on the corn panel together, Todd, and that was when we were at about 60 degrees in Covington.
• 2:06
  So it was a crazy trip home. I diverted to Saint Louis, spent the night with my daughter and and son-in-law, and then came back early in the morning, through some snowfall, but very glad I didn't try and drive all the way back because there's a lot of cars and jackknife trailers in Saint Joe, Missouri on, on, Wednesday morning. So thank you for having me.
• 2:27
  Todd Gleason: Yeah. I'm glad you were able to divert and make that trip, to Saint Louis, spend the evening with your daughter and son-in-law, and then I suppose off to Kansas City and then up north to to, St. George, something along those lines to get back to Atchison. So thank you. You had the rest of this week to take a look at the trade.
• 2:46
  Did it change your mind in any way on what you've been thinking?
• 2:49
  Mike Zuzolo: No, it hasn't. I mean, we we knew that this volatility was gonna be tough to deal with. We knew the trade was gonna be erratic. And and I would say we could probably increase the amount of volatility and erratic trade behavior going forward because we are pretty much where we were when we started the week out. And so we could replicate with fresh tariff news what we did this week.
• 3:13
  I will say the charts look much better than they looked on Tuesday. One commodity that does look extremely healthy compared to Tuesday that we don't really talk a lot about is the live cattle. It did look like a capitulation type market and Friday's close being up over 2% or 400 points on the day for a back half was a really nice move, to close the week out. So they go into next week looking very healthy, both sentiment wise, technically. As for the corn and beans, there's a couple big roadblocks right now that are probably gonna keep us, in in the thicker mud at this point.
• 3:53
  I think it's gonna be The US Russia sanctions that are being talked about and and the idea that you The US could add more severe sanctions onto Russia. That could strengthen the dollar, weaken the emerging market currencies. We'll see if the crude oil market can compensate for that by going higher. Number two would be the WASDE report on Tuesday. The WAOB has made the announcement that they are going to try and put in new tariff numbers in the supply demand tables.
• 4:21
  And so that's gonna bring some added volatility and question marks to the trade, I suspect.
• 4:26
  Todd Gleason: They will be doing that right up to the last moment because it changes day to day. That is some of the chaos that we are were used to in the previous Trump administration. I am wondering how you deal with that. I was thinking about what to do. I I it's hard to market, without having orders in consistently, and then you don't often sometimes hit the hit the points that you're expecting because there's another announcement out of the Oval Office.
• 4:53
  How do you deal with that volatility, and trying to position producers? What do they need to do?
• 5:00
  Mike Zuzolo: You know, the biggest thing we learned this week, was early in the week before president Trump announced the physical, tariffs when he did a press conference, and he said specifically that if China continues to weaken their currency to export their way out of the market and take business away from us, we're gonna continue to increase tariffs. And so we have a very strong sense of what his modus operandi is gonna be as far as taking care of bringing manufacturing back here and or bringing back, the the trade disparities and and getting back some export business to The United States. That's number one. Number two, that goes right back to the dollar. And I think one of the biggest reasons why we did find quite a bit of support after Tuesday was mainly because the dollar plummeted and went through its forty month moving average at the end of the week.
• 5:54
  It didn't stay below it, but it went below it. A new four to five month low was seen in the dollar index. At the same time, the Canadian dollar and the Mexican peso and some key, trading partner currencies actually strengthened in the middle later part of the week against the dollar. That helps us a lot to keep our goods cheap, especially when supplies are tight. So that's number one.
• 6:18
  And I think number two is the March weather is gonna probably dictate whether the funds wanna be net sellers or net buyers. And the trade, in my opinion, thinks it's gonna be very warm and wet in the Corn Belt. We're not gonna have a drought. Those drought numbers did not say that with 60% of our Corn Belt now in drought after this week's update and and double what it was a year ago at this stage of the game. And so if we stay dry in March, I think that opens the upside up or at least trims the downside when it comes to the corn and bean and wheat markets, especially.
• 6:50
  Todd Gleason: On that drought note, I asked, Eric Snodgrass for later in this program about Mexico just to remind us, that they had had really dry, droughty conditions. Last year, a poor corn crop. That seems to be a double edged sword to me, related to, how much corn they have imported from us in this marketing year, what the expectation might be for the coming marketing year if they were to recover. He thinks that they're still, in a poor position at this point. How do you see that playing out, tariffs on or off?
• 7:25
  I guess, it's a difficult prospect, but Mexico is the number one importer of corn from The United States.
• 7:33
  Mike Zuzolo: No. It is. And that's just another facet of why I'm more sincerely worried about China and The US and Us going up to 60% tariffs against China. Because Chihuahua, Mexico, in particular, from what I've been watching, has actually worsened since last year. And that's a very big area.
• 7:48
  But it's also a big livestock area. So we've got to be very careful about losing animals and therefore losing feed demand in the future. But as far as drought goes, they're not improving in some of the key areas. And so I'm less concerned that they're gonna take us on with our agricultural exports, whereas with China, especially with their updated numbers that came out Friday morning, Todd, their Jan Feb imports overall in China that they brought in those two months down almost 8.5%. Really spooked the market in the copper, especially on the close Friday morning.
• 8:20
  That was down 8.5% almost year over year. So it really does suggest the 2024 import pace that we saw really does look like more of a strategic reserve buildup. So every angle or almost every angle I look at it right now, I'm more concerned about China when it comes to US trade and US Agriculture trade specifically.
• 8:40
  Todd Gleason: We'll ask you to keep track of that. Thank you much.
• 8:43
  Mhmm. That's Mike Zuzelowis with GlobalcomResearch.com out of Atchison, Kansas. Teresa Steckler, an extension beef cattle educator from the University of Illinois, now joins us. She's been working with beef producers in the state as it's related to tick populations and some of the dangers that they present for cattle herds. Thank you, for taking some time with me, Theresa.
• 9:09
  Can you remind us about a tick that has moved into the state and what problems it creates?
• 9:15
  Teresa Steckler: Hi, Todd. It's good to talk to you again. Yes. That tick would be the Asian longhorned tick. It has been located in one county so far.
• 9:23
  However, the problem with this tick is it is parthenogenic, which means that it can reproduce without a male. So a single tick can turn into thousands in a short period of time.
• 9:34
  Todd Gleason: And what issues does it create within a herd?
• 9:37
  Teresa Steckler: So what it can do, it it can have so many ticks on a cow or heifer, whatever, that can actually cause exsanguination or there could be so many bites that an allergic reaction can be caused in these animals as well.
• 9:54
  Todd Gleason: So, really, the tale today is a cautionary one, I think, if I remember correctly, about transportation, checking animals that are coming into your herds, checking animals that are going out of your herds for the Asian longhorned tick.
• 10:11
  Teresa Steckler: Correct. We want people to be aware that if they're bringing any cattle in from it tick has been found in Missouri, Kentucky, Tennessee, Northern Arkansas, and a lot of states in the Southeast and the East. If you're bringing any in, like backgrounders or buying bulls, cows, whatever, please quarantine quarantine those animals, pour them, and do a very vigilant check that they do not have any of these ticks. They're gonna be small on but and you have to be very careful when you go to check them. But, you know, be proactive.
• 10:46
  And if you have any questions, feel free to reach out to me.
• 10:50
  Todd Gleason: Do they have any unique things about them, the way they look that make them identifiable easily? And when you say small, how small?
• 10:57
  Teresa Steckler: They are very small. They're about the size of a poppy seed. But if you if the cattle have any large numbers, there's gonna be clusters of them. And, of course, as the ticks, engorge themselves, they'll get much bigger. And typically, we see them on the around the udder, the brisket area, the ears, anywhere there could be folds of skin.
• 11:19
  The ticks like to get down in those areas.
• 11:21
  Todd Gleason: And I suppose you want to be notified?
• 11:23
  Teresa Steckler: That would be fabulous. It's better to, you know, get a hold of us, and I can actually get the ticks identified and make sure that it is is or is not the Asian longhorned tick. And if other you know, if you do have it, we can be proactive and try to lessen the impact that that tick can have.
• 11:42
  Todd Gleason: Do they need to isolate the animals if they find them?
• 11:44
  Teresa Steckler: It'll be a little bit, but yes. If you do we do find them, you do need to isolate those animals, and we need to pour those animals, and we need to work with your local herd veterinarian, and we also need to work with Illinois Department of Ag. And so we can hopefully get the tick under control as best as we can in your in on your farm.
• 12:02
  Todd Gleason: Teresa Steckler is a University of Illinois Extension beef cattle educator. If you'd like to learn more about the Asian longhorned beetle, you can search that out and look for the USDA invasive species pages. Let's turn our attention on this Friday afternoon now to the global growing regions, climate and weather. We're joined by Eric Snodgrass. He's with Nutrien Ag Solutions.
• 12:35
  Hello, Eric. Thank you for being with us today. We have a lot of ground to cover. Let's start with the rainfall that we did or did not have, depending on where you were in the state of Illinois, I guess, on Tuesday, Monday, Tuesday, and Wednesday. But we did have some.
• 12:52
  Can you kinda outline what happened?
• 12:54
  Eric Snodgrass: Well, I'll tell you this. I heard from numerous growers across the state after that system went through. And I was out at Commodity Classic, and it was crazy windy out in the plains. I I mean, it's been a long time since I've seen synoptic level winds at that speed just ripping across an area. In other words, not from a thunderstorm, but, you know, we had a big system all across.
• 13:12
  And if it did, it hit a lot of places in Illinois, and I had several like I said, several growers reach out and said, oh my gosh. That that was what I needed. We're now, you know, we're we're now just starting to really think about what spring's gonna be, what planting's gonna look like, but that rain was huge. Now it also brought blizzard conditions. I'm not sure if you heard, but Iowa got hit hard with this, but they're not.
• 13:31
  Most of
• 13:32
  Todd Gleason: those folks in Iowa like that. Snow's gonna melt. I'm gonna get to
• 13:34
  Eric Snodgrass: keep some of that moisture. In fact, the Southeast Corner Of Iowa picked up two to three inches of liquid out of all of this. So there were some very big positives there. But here's the thing, Todd. It's March, I have not changed my big concerns with our lack of subsurface soil moisture.
• 13:50
  I've not really talked you know I've not really seen a lot that's got me in other words I've not seen anything yet that has this drought worry off the back of my mind, but I'll say this. If we could get six additional storm systems like I just saw before April 4, we will not be talking about drought at all. Now we're all gonna hate that because it's gonna be just like one, you know, one or two every week just ripping across the country, but that could undo a lot of the major drought risks that I think we see, especially to our west, going into this, 2025 planting season. So, Todd, I'm happy March is coming in hot. It's coming in with multiple waves hitting the West Coast.
• 14:29
  Our next big one will probably be around the fourteenth, fifteenth of the month, and I'm I'm talking another big storm system coming through. But, we need to keep them coming in order to beat back this drought risk.
• 14:40
  Todd Gleason: I'm just happy it's coming in warmer. Yeah.
• 14:43
  Eric Snodgrass: It is. I mean, we're gonna out ahead of this big system next week. I mean, it it this next one's gonna be big, Todd. I think it's a lot of severe weather down south. It's probably gonna be big snows for the Northern Plains, which are still in snow drought, parts of the Upper Midwest, which need more snow.
• 14:57
  But this one, as it comes across us, just watch the temperatures each day continue to climb. My kids are pretty pumped because I told them early next week they're gonna get in the seventies. But remember, when we get warm this time of year, it almost always gets windy too. So we'll have some pretty strong winds out of the south ahead of this next big system, but just be prepared when it comes through us late next week that we could be talking about, the risk of strong to severe storms, heavy rain, and, again, blizzard conditions on the backside.
• 15:24
  Todd Gleason: Okay. So that's one, two. Is there a third storm that you're thinking about?
• 15:28
  Eric Snodgrass: I'm hoping so, Todd. I really am. I I would like to see the atmosphere do do this again and again and again, honestly, as we work away to the end of the month. But there is a part of this we have to consider. Okay?
• 15:40
  Each of these storm systems, they've missed Texas. They've missed parts of Oklahoma, parts of Kansas, parts of Colorado. And if you didn't see this earlier in the week, behind these previous two systems, there have been dust storms that came out of New Mexico and hit Texas that were the size. The dust storms themselves were the size of the state of Illinois. So we know that there's problems.
• 16:00
  We know that there's drought in Mexico. We know that, the next fifteen days, Kansas is not expected to pick up any of this moisture. So you just start thinking about the the haves and the have nots. And to be honest with you, as we slide towards spring or we're actually technically in it, but as we slide toward the spring that we really need to be thinking about, I think it's gonna be a situation where if you're East Of The Mississippi, we're gonna be looking at more routine rains and possibly much tighter than normal windows. I think if you're West Of The Mississippi, we're just going to be concerned about can we bring in enough spring moisture.
• 16:31
  And I'll tell you this, Todd, I don't know if I mentioned you this a couple weeks ago, but my my my friends and colleagues, Andrew Pritchard, I think I mentioned to you before, they're all targeting Ohio Valley. They're all targeting the Southeast for storm chasing, and not a lot of them are talking about, you know, Texas, Oklahoma, Kansas, Nebraska. So, again, if you start hearing Andrew talk about wanting to chase storms out in Kansas, that is a major major positive signal that this risk of summer drought in the Central Plains starts to back off, which means it doesn't encroach on the Mississippi by the time it gets to July.
• 17:04
  Todd Gleason: Most assuredly, we will know on WLL if Andrew is chasing because he's he's on WLL every day with our local weather forecast. I wanna go back to something you mentioned just in passing. K. The drought in Mexico because they are the number one importer of corn from The United States. They had a drought last year.
• 17:24
  Was that in the primary areas of corn production? I think it was. Yeah. Had a big impact. What do you see for them this spring and summer?
• 17:33
  Eric Snodgrass: Well, their biggest problem was this winter, there was no subtropical jet. That's the piece that comes from Hawaii. So one of their biggest kind of regions of the Chihuahua region, that is a spot that's been in drought. It extends, all the way toward the Baja of California as well. And so what we just worry about is if that's there.
• 17:51
  I mean, it was there in 02/2011. K? And it spread into Texas, Oklahoma, Kansas throughout that summer of twenty eleven. So it's interesting, Todd. You know, here in Illinois, we're always like, oh, the drought of 12.
• 18:01
  You go to Texas, like, oh, the drought of eleven. That's the one that they remember most recently. So unless we can get that all knocked out soon, we're gonna be looking at some some trouble here as that spreads to the north. And by the way, we did just get all new seasonal model data in this week too, and the newest European model is trying to paint more of the Great Basin, so that's out in the Intermountain West, more of the central states in The US, talking about the plains there, up to parts of the Southern Canadian Prairie as having the greater risk on being hotter and drier this summer. So, you know, that kind of forecast from that model backs up what you and I have been talking about for weeks.
• 18:39
  It just says that Mississippi River, if you're to the west of it, the farther west you go, the greater the risks are for heat and drought. The farther east you go, I think it's gonna be a discussion of tight spring windows, and we'll just see if the moisture hangs on long enough to buy us time during summer.
• 18:53
  Todd Gleason: We are only twenty four days from April. What do you see for that month in the Midwest?
• 18:58
  Eric Snodgrass: Okay. I don't like what I'm about to tell you, Todd, and that is there is some evidence that at the March and the April, I'm not sure on the timing yet, but I'm basing this off of some cadence with a few other things, that we could be looking at another shot at some chilly air coming in maybe for four or five days. Right? Now the worry is that if we see that at the April and the pattern stays on its similar cadence to what it's been on, then that would mean we'd have another cool shot at the May. Now we don't want our seed to sit in cold wet ground when we plant it.
• 19:28
  Right? And so I'm not settled on this. I'm just letting you know that there seems to be a little bit of a cadence to the temperature pattern that if it persists, I just see some cooler weather at times that will come kind of not at the right time, but when we wanna get a crop established. But I am more than prepared to be wrong on that. Maybe we've broken out of that.
• 19:48
  But if I can tell you the worry, Todd, what if we blow open the doors really really warm and we just get warm for the rest of spring and stay there? That's not good either. You've got to keep the temperature contrast up in spring because if you do, you keep the jet stream around longer. You don't wanna blow the doors open hot in spring because it can ruin the flow for summer. That's exactly what happened in 2012.
• 20:09
  So, Todd, I have a lot on my mind if you couldn't tell, because there's just so many moving pieces as we start to get into this next season.
• 20:15
  Todd Gleason: We'll check on things again next week. I appreciate it.
• 20:18
  Eric Snodgrass: Yeah. You bet.
• 20:19
  Todd Gleason: Eric Snodgrass is with Nutrien Ag Solutions. Joined us here on the closing market report for this Friday afternoon. Stay with us for the whole hour if you can. You'll hear all of our Commodity Week program. Today, we'll hear from the Aldag Outlook and the fundamental outlook that Joe Jensen, FarmDoc team member, agricultural economist from the U of I, presented on Tuesday of this week.
• 20:43
  If not, you can always find it online right now at willag.org, w I l l a g Org.
• 20:57
  announcer: Todd Gleason services are made available to W I L L by University of Illinois extension.
• 21:02
  Todd Gleason: Welcome to Commodity Week. I am Todd Gleason. Today, we'll hear from the all day ag outlook recorded on Tuesday, March at the Beef House in Covington, Indiana. Joe Janssen, Agricultural Economist from the University of Illinois, set the tone for the day by laying out the fundamental picture of corn and soybeans in The United States, usage, and the impact of global stocks and trade. Now here's Joe.
• 21:28
  Joe Janzen: I'm gonna just sort of talk through the situation as it stands where we're at. I think the watch word, of the day would be uncertainty. I think a lot of people have sort of heard that word sort of thrown around a lot. There are these like market sentiment or consumer sentiment indices you'll hear about these. These will kind of always make news when they get released.
• 21:50
  Basically, what they do is they ask, you know, so what what is your opinion on the current situation in business or employment or sort of consumer spend, you know, your own spending, your own sort of personal financial situation. And it's usually sort of like they ask a person and they say, is it positive, neutral, or negative? And, you know, people weigh in and we aggregate that across lots and lots of people and we kinda get a sense of, you know, sort of how are people feeling about the economy. A lot of you may have seen Purdue does something very similar for ag, the folks over in Purdue Ag Econ, which is a useful and interesting thing I kind of I look at it, I don't know what it what it really means. Eight years ago, it spiked in November of twenty sixteen.
• 22:37
  It did that again last November. And we I've I'm very interested to sort of see where we go with that sort of idea of, like, sentiment. But I think there's a sort of a sense in which, like, a lot of our ag economy is kind of, you know, driven by sort of sentiment and vibes, at the moment. And I think, hopefully, we wanna put some something a little more solid, some some more meat on those bones.
• 23:01
  Todd Gleason: Joe Jansen is an agricultural economist and a member of the FarmDoc team. He spoke earlier this week at the All Day Outlook at the Beef House in Covington, Indiana. You may hear more from him online at willag.org, w I l l a g 0 r g, or just by looking for the Commodity Week podcast in your favorite podcast application or by staying tuned to this radio station over the weekend. I'm University of Illinois Extensions, Todd Gleeson.