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Feb 11 | Closing Market Report · Closing Market Report

• 0:00
  Todd Gleason: From the Land Grant University at Urbana Champaign, Illinois, this is the closing market report for the February 2025. It's USDA Report Day. I'm Todd Gleeson. Coming up, we'll talk about this morning's report with Naomi Blohm. She's at totalfarmmarketing.com out of West Bend, Wisconsin.
• 0:18
  We'll hear from this week's Illinois Soybean Summit, and we'll take a look at the weather forecast too. Don Day will be here from DayWeather.com in Cheyenne, Wyoming on this Tuesday edition of the closing market report from Illinois Public Media. It is public radio for the farming world. Todd Gleason services are made available to WILL by University of Illinois Extension. March corn for the day settled at $4.84, down 7 and a half cents.
• 0:42
  The May 6 and a half lower at $4.98 and December at $4.70 at a quarter down a penny. March soybeans at $10.43 and a half, down 6 for the day. November new crop at $10.55 and a half cents, down 2¢ for the afternoon. And bean meal, down $3.90. The bean oil, 40¢ higher.
• 1:01
  Wheat futures, soft red at $5.77, 2 and a half lower. The hard red in the March at $5.92 and a half, down 4¢. Live cattle futures, $2.12 and a half lower. Feeders, $3.35 lower. And lean hogs, down a dollar 35, crude oil at $73.30 a barrel up 99¢, diesel fuel six and a tenth iron at $2.51 a gallon, and gasoline at $2.37.
• 1:26
  That's up 3 and 6 tenths of a cent on this Tuesday afternoon. Naomi Blohm now joins us from totalfarmmarketing.com. She's in West Bend, Wisconsin on this USDA report name. Not a lot of changes in the supply and demand figures for corn and soybeans. Actually, really, the only change there was that corn was up a dime on the season's average cash price, and soybeans were down a dime.
• 1:55
  What'd you make of the numbers as they came out? And maybe you can go through some of the changes on the global side.
• 2:01
  Naomi Blohm: Yeah. Absolutely. So the report was what I just called dud, flat out. And a lot of times with the February report, we don't get a lot of big adjustments because the USDA usually does some shocking stuff on the January USDA report, which is, you know, what happened, of course. So today's report, no changes at all to The US supply and demand spreadsheet for corn or soybeans.
• 2:27
  And then the only thing for an adjustment for wheat for US wheat, ending stocks came in just 4,000,000 bushels lower. But on the global side of things, the USDA did acknowledge that it hasn't been perfect weather in South America. So in Argentina, the crop for corn was cut by 1,000,000 metric tons to 50,000,000 metric tons, and the soybean crop in Argentina was reduced by 3,000,000 tons to 49,000,000 tons. Looking at Brazil, they cut corn crop by 1,000,000 tons to a 26,000,000 metric tons, but they made no changes on that bean crop. Still humongous at a 69,000,000 tons.
• 3:12
  So, you know, again, acknowledging the situation, but because the report gave us no big over the top friendly news today, grain markets did not have a reason to get through resistance levels on charts, and that's why we saw things finish the day lower.
• 3:29
  Todd Gleason: Yeah. What are your expectations the rest this weekend? What are you talking to producers about as it relates to their crop insurance and how to understand what that means for this year as compared to previous years?
• 3:42
  Naomi Blohm: Yeah. So looking for probably now with this report being, very neutral and benign, looking for corn market to trade maybe just sideways or a little lower. The bean market, though, I could think we could see that, start to work into a lower trend overall just because when you step back and look at the big picture, it's a comfortable US number for ending stocks, and we have record global carryout. So regarding the February crop insurance number, that, of course, gets discovered throughout the month of February. You know, the the thought might be what if this market price continues to grind lower into the February, ultimately leaving for potentially lower prices for crop insurance adjustments as the year goes on.
• 4:25
  So that's something just to be mindful of. In general, again, the the corn fundamentals are supportive, but without any big fresh news to take that corn market higher, we're probably gonna just take a step back here and and take a look at things and and trade in the sideways pattern. And with that bean market, that might be at risk of of a bigger correction lower, with that price maybe on the nearby March contract heading down to closer to about 10 and a quarter and maybe that $10 price point as well.
• 4:55
  Todd Gleason: By corn fundamentals being supportive, you mean ethanol grind has been good and feed and residual numbers still look to be running along nicely?
• 5:04
  Naomi Blohm: I think that is a major component of it. When you look at the ending stocks now at 1,540,000,000 bushels, we're gonna probably see that number continue to stay snug at 1,540,000,000 bushels for the next month, but it does set us up now that if there's a weather issue in Brazil or if there's a weather issue in The United States this spring or summer, because that old crop ending stock number from the January report is so supportive, it really could keep the market in general supported overall or be a nice springboard for a summer rally in May or maybe early June. So just something to be mindful of. It's it's a, global ending stocks for corn also, still, you know, kind of trending lower overall. So things to be really watching for and mindful of, we'll wanna continue to see if our corn exports stay strong.
• 5:57
  We had Mexico step up here to the plate recently and buy some additional corn, and we'll wanna, make sure that our ethanol demand, as you said, stays as strong as what it's been. So we're on target to meet USDA demand projections. The question would be, can that demand get a little bit stronger in the months to come and part of that hinges on second crop weather for second crop corn in Brazil.
• 6:20
  Todd Gleason: Yeah. So ending stocks for corn, we talked about production but it was roughly the same change, so down what 2,000,000 metric tons for corn. Soybeans, I think we're down three, three and a half, something like that in total. Those are numbers you'll be watching closely. Part of that because farmers in Brazil have a corn crop they're putting in the ground now, and farmers in The United States will be making some decisions about their corn crop for later this season.
• 6:49
  Total number of hectares in acreage will make a difference, I suppose, going forward.
• 6:53
  Naomi Blohm: Yes. Absolutely. And then on that note of acres, at the February will be the USDA Outlook Forum. So it's not a USDA report. But lately, we've been starting to treat it like a report because the USDA will throw out their first guesstimate of acres in The United States for the coming year, and the trades have been starting to trade it.
• 7:12
  And so the USDA also takes a look at, usually using a trend line or near record production number for yield on that report as well. So a lot of things that could, kinda tweak and massage the markets going forward, but, again, without any immediate fresh news today, the grain markets are gonna struggle to rally significantly higher here in the short term and look for just, I think, sideways trade to a little bit of a price pullback as the month of February now goes on.
• 7:41
  Todd Gleason: We look forward to talking with you again next week.
• 7:44
  Naomi Blohm: Thank you so much. Appreciate it, Todd.
• 7:46
  Todd Gleason: That's Naomi Blum. She is with totalfarmmarketing.com. You know, three weeks from today, we'll be at the Beef House in Covington, Indiana. I sure hope you will join us, but you'll need a ticket. You can get that right now online at farmdocdaily.illinois.edu or on our home site at willag.0rg.
• 8:10
  That's willag.org. The cost is just $40. The day long event agenda is right there for you to see at willag.org. That includes Joe Jansen from the FarmDoc team talking about the fundamentals of the marketplace, Joanna Colusi discussing South American production, Bruce Sherrick taking up the price of farmland, all ag economists from the University of Illinois, Ellen Dearden, Greg Johnson, and Danny Fach will highlight our soybean panel. We'll toast four decades of the closing market report over the noon hour with your beef house lunch.
• 8:44
  Oh, you'll start that day, by the way, with a cinnamon roll and the coffee from the beef house as well. And we'll have a book signing over the noon hour with, Neil Dahlstrom. He's the author of Tractor Wars. That's the PBS documentary as well, which will be broadcast on WIL channel twelve in the month of March. Make sure you buy your book and bring it with you for Neil to sign.
• 9:07
  Also there to sign books will be Scott Irwin, ag economist from the U of I, and Jonathan Koppas. The details about those books are online at willag.org or farmdocdaily.illinois.edu. Get your copies, bring them with you. Jonathan's books, you can get at a 40% discount with a special code as well. Look for that again at willag.org in the afternoon.
• 9:29
  Guess what? Sue Martin will be with us. That's right. Sue Martin's flying in from Iowa for us along with Brian Stark and Mike Zuzlow, who's coming all the way from Kansas to be on our corn panel. John Reed from the University of Illinois from the Center for Digital Agriculture will be there to talk about autonomous operations on your farm.
• 9:50
  They're coming, and they're coming soon. He'll take that up, and then we'll put the whole of the farm doc team or a lot of them up as we close out the day for a wide ranging panel discussion. I've done this only once in the past. It is both fun, funny, and very serious. You will want to be there for the whole of the event.
• 10:09
  The cost is just $40 a person. Sign up right now at willag.0rg. Now up next, over the first two business days of this week, the Illinois Soybean Association has hosted its annual Soybean Summit right here on the Urbana Champaign campus of the U of I. I've dropped in and out of that conference a couple of times and was there this morning as the association along with representatives of USEC, that's the United Soybean Soybean Export Council, took up the near and long term potentials. It focused on places like Colombia, Egypt, and India, and mostly in terms of soybean meal rather than whole soybean exports.
• 10:49
  I had some questions about that, particularly as it related to transportation, competition from synthetic amino acids, bean meal is an amino acid source, and why USAC and the Illinois Soybean Association believes US sourced soybean meal has an advantage on the world marketplace. I talked with Todd Main, director of market development at the Illinois Soybean Association. So I had some questions, this morning here at the soybean summit about some of the information being presented just because I I I wondered as, USAC, the United Soybean Export Council, was thinking about how, those exports would be developed over the years. They were focusing a great deal on soybean meal. It's something that we need some transportation issues with, but more importantly that there not only is, competition from other parts of the world with soybean that's produced in Brazil, Argentina, other places, China as well, but also that there is a synthetic version of the amino acids that come along with the bean meal, which is really the building blocks of why soybean meal is used in aquaculture, poultry production, pork production, livestock feed in general.
• 12:07
  And I'm I'm first, you you mentioned that, US soybean has advantages. This was not something I was really quite aware of. Can you talk about that to begin with as it's related to amino acids?
• 12:23
  Todd Main: Yeah. There's been a a a great deal of work been done on this over the last few years. And what we found is that, last fall, there was a study that came out that USEC commissioned, which really showed that the unique qualities of US soy do give it a competitive advantage in the global marketplace, because of the amino acid profile and, the digestibility rate and some other things, they really make the soy, from The US, a better deal for a lot of these countries.
• 12:56
  Todd Gleason: What is it about US soy that makes it makes that happen? What is is it about the production, about the soils, about the environment that is inherent within US soy that gives it this advantage over soybeans produced in other parts of the world?
• 13:11
  Todd Main: Well, there's a couple of advantages. The first one of them is that is, outside of the actual production of the bean, it's the transportation system. And our transportation system now is, among the best in the world, and it is our competitive advantage. Our ability to get our beans anywhere in the world where they need to be on a regular time, is a really, an important factor that we hear about. The second is the quality because US beans are, handled better in the process.
• 13:42
  And so when they arrive at the final destination market, they're just a better quality. They don't have the same, damage maybe from, South American beans that are heat treated. And, when you heat treat beans, one of the things that you sacrifice, if you don't do
• 13:59
  Todd Gleason: it right, is your amino acid profile. I'm wondering for about four decades, there has been an undertow, a current to, pay US Producers based on the amino acid profile, relatively speaking. AGP has been involved in this to some extent. Is there a reason to or not to push that kind of profile and a way to pay producers. And you can talk a little bit about some other things that are happening within this sector too that are, unique that you discussed already in front
• 14:35
  Todd Main: of the crowds. Sure. Well, I think, as the science gets better on this stuff and as we develop ways to distinguish ourselves from, our competitors in the marketplace, I think one of those things that that we're gonna find is that some of these products are gonna have a premium associated with them because of the nature of it. The challenge we face in the global marketplace is everybody, in the beginning just cares about crude protein. And whatever your crude protein numbers are, that's sort of the driver of that.
• 15:09
  But what we've spent a lot of time and and USAC has spent a lot of time doing is sort of differentiating ourselves by looking at things like amino acid profile, looking at how different species, uptake the, the food or the the protein within the the soy itself and how that translates into better production for them.
• 15:30
  Todd Gleason: So you discussed this in terms of, soybean meal specifics for different livestock categories, in particular for beef cattle and for dairy cattle?
• 15:41
  Todd Main: Yes. Yeah. What we're what we've really focused on is, aquaculture, which is there's a which is a growing, particularly in South America and in North Africa, where they're very sophisticated aquaculture production and a way to, to really expand and feed their people. One of the funny things about this, which is a little different, is that, what we're hearing from our international buyers is food security is a isn't a really important issue for them. Because when a country can, the first thing they wanna do is get food secure because they can stabilize their population and then start to grow their population, which adds into all kinds of productivity increases across the sector.
• 16:25
  And so, aquaculture is a great way. Poultry is also another great way for countries that are just emerging that, that they can start
• 16:36
  Todd Gleason: to get food secure. Historically, The United States has exported whole soybeans. Why the push for the products, soybean meal and soybean oil?
• 16:47
  Todd Main: Well, what we're seeing really is the market is is shifting. You know? It used to be that oil was the or excuse me. The meal was the important part. Oil was the sort of left behind part.
• 16:58
  But with the rise of the use of biofuels and soybean oil going into that, now it's the the oil is driving the market, and the meal is sort of the the byproduct that we need to figure out what to do with. And it just depends on the market, you know. And I think what you see in Southeast Asia so if you look at Vietnam, Cambodia, Indonesia, some of those places, they only want meal because they are swimming in palm oil. They don't have any use for the oil. They don't wanna build crush facilities.
• 17:31
  They don't they just wanna import the meal, and so they're some of our biggest meal importers. And then you look at other places like Egypt and North Africa where they where they need both the oil and the meal. And so they make the investments to put the crush facilities in in. So we're actually needing to just calibrate, our offerings for what the demands are of those local markets in a way that maybe we didn't have to in the past.
• 17:55
  Todd Gleason: It's it's a push pull depending on what the market is. So for instance, as you suggested in Indonesia where they have lots of palm oil, they use that as cooking oil. They don't really need vegetable oils coming in. Right. They want bean meal, and other places around the planet are the same way.
• 18:11
  And here in The United States and and in Europe, sustainable aviation fuel is likely to be the demand drivers for soybean oil, probably renewable diesel as well, which leaves meal, which had been the most expensive product as oversupplied in The United States and finding a way to export that out of The US is important.
• 18:34
  Todd Main: Yeah. As the biofuel market, grows and takes over, that leaves us a lot of very competitively priced meal. And what we're finding is is that demand I mean, we were a little nervous about this, but we're finding that demand for the meal globally is they'll take it as fast as we can get it. And even in The Americas, in in Colombia, which is one of our biggest markets, there, they don't have crush. They want the meal.
• 19:00
  They want the oil brought in, but they're also a regional hub for pet food. And so they use a lot of the meal in pet food as well. And so there's just a a lot of different things that are popping up now that we've got some competitively priced meal to to bring to the marketplace.
• 19:16
  Todd Gleason: And then returning lastly again to synthetic amino acids, which have been developed, can be used certainly in livestock feeds, other places. How much competition on the world marketplace are they?
• 19:32
  Todd Main: Well, I mean, I think they're always gonna have a place. And, you know, what our strategy is is is that we wanna really move into understanding the science behind what is the optimal amino acid profile for the species that we're raising, And how do we then, set the inclusion rates to optimize that for for what's biologically possible? And I think that's a real area of competitive advantage because we've got the hard science abilities here in The US to really use that as a differentiator and then come in and be able to work with the feed millers there who maybe don't have that same background, but but can, can understand it.
• 20:16
  Todd Gleason: Thank you very much. Thank you. Todd Main is director of market development for the Illinois Soybean Association. I spoke with him earlier today at the Illinois Soybean Summit held in Champaign. Don Day from Day Weather in Cheyenne, Wyoming now joins us to take a look at the weather forecast.
• 20:45
  Hi, Don. Thanks for being with us. Cold air has come into The United States. Can you tell me about the forecast for the next five to ten days, please?
• 20:55
  Don Day: Sure. Get used to the cold, especially, if you're I mean, north of, let's say, the Interstates Of 70 And 80, even along and North of Interstate 40 across the Southern US, we have another big push of arctic air. And unlike the one that we had in January, which was impressive, this one is more draped west to east across the northern tier of The US, and it's gonna have some staying power. And along the Arctic boundary, we're gonna see a wide swath of snow that'll go west to east from the the Rockies through the Plains to the Great Lakes and into the Northeastern United States. And it looks like for the February, more often than not, it's it's gonna be colder than average for a lot of the nation.
• 21:42
  Todd Gleason: So this first system will sweep through it already is, our part of the world and through tomorrow, but it's just the beginning of a series of systems, I take it?
• 21:53
  Don Day: Yeah. What'll happen when you get these Arctic outbreaks is you'll get little waves coming off the Pacific Coast that will ride the boundary of the Arctic air to the north and the warmer air that's in the Gulf Region. And this will cause little systems to migrate along that boundary occasionally, bringing snow chances about every two to three days. So this is a pattern that's gonna do this for the next week, week and a half or so.
• 22:18
  Todd Gleason: Will it bring enough snow that it will cause problems?
• 22:20
  Don Day: It certainly will. And with temperatures as cold as they are, that's gonna lead to you always get that boundary where you get rain, then freezing rain, then sleet and snow, and so that'll be some icy conditions along that boundary. But as you look at the the northern half of Illinois, Indiana, a good part of Iowa, Nebraska, southern parts of Wisconsin, and Minnesota, and into the Great Lakes region. The snow's gonna add up, over the next seven to ten days, and it's gonna be sticking around for a while.
• 22:50
  Todd Gleason: Thank you very much. We'll talk with you again next week.
• 22:52
  Don Day: Sounds good. Good.
• 22:53
  Todd Gleason: Don Day is with Day Weather in Cheyenne, Wyoming. Joined us on this Tuesday edition of the closing market report that came to you from Illinois Public Medium. Find us online. Get yourself registered for the all day I got look today at willag.0rg. I'm Todd Gleason.