Latest / AG Bull / Wiesemeyer's Perspectives | Grain Markets Collapse

Transcript

Wiesemeyer's Perspectives | Grain Markets Collapse · AG Bull

0:09
SPEAKER_02: Welcome back, Tommy Grossoffi, Agbo Media, Agbo Trading.
0:13
SPEAKER_02: You're listening to Wees Meyer's Perspectives.
0:16
SPEAKER_02: Welcome back.
0:17
SPEAKER_02: It's Sunday afternoon, and there is a lot of news going on.
0:21
SPEAKER_02: We have some breaking news.
0:23
SPEAKER_02: We have all types of stuff going on.
0:25
SPEAKER_02: And I gotta tell you, call me a conspiracy theorist or something, but I'm starting to wonder, does Washington DC really have the American farmers back?
0:36
SPEAKER_02: Did you see what markets did this week?
0:39
SPEAKER_02: Oh, did I mention screwworm is now in the United States?
0:43
SPEAKER_02: Not just one case, two.
0:45
SPEAKER_02: And where there's two, there's usually three, four, five, and many more.
0:49
SPEAKER_02: Now the USDA is on it, but what's that look like?
0:52
SPEAKER_02: Most of us aren't even old enough to remember last time screwworm was in the United States.
0:57
SPEAKER_02: But I happen to have most wonderful partner in crime, the Dean of Agriculture, who said, Honest Abe was really honest.
1:04
SPEAKER_02: I'll see you in 30 seconds.
1:45
SPEAKER_02: He is unmuted.
1:46
SPEAKER_02: He is ready to go.
1:47
SPEAKER_02: He's already practiced coughing, but I guarantee there'll be a few more.
1:51
SPEAKER_00: There will be.
1:52
SPEAKER_00: And I'm glad actually we've been doing these on Sundays because, as we always say, late breaking news from late Friday into today.
2:01
SPEAKER_00: And we've got uh some that we'll go through later on after the market.
2:05
SPEAKER_00: So I'm glad we waited.
2:07
SPEAKER_02: Let's uh do the markets together.
2:09
SPEAKER_02: You're on the left, I'm on the left, markets are in the middle.
2:11
SPEAKER_02: Jim, these prices are uh look at it.
2:14
SPEAKER_02: Wow.
2:14
SPEAKER_00: Talk about a correction.
2:16
SPEAKER_00: Yeah, look at uh soybeans down a little over 65 cents.
2:21
SPEAKER_00: Look at soybean oil all the way through.
2:23
SPEAKER_00: I mean, the the only ones that were up were live cattle feeder cattle, and that was it, basically.
2:30
SPEAKER_00: Now we're into seasonal low patterns, uh, you know, and the the weather improved somewhat, and then you had your uh uh uh longs bailing out, not not in a major well, I would say in a somewhat major way.
2:45
SPEAKER_00: Again, improved crop conditions, no big China demand yet.
2:50
SPEAKER_02: Okay, yet we'll talk about more of that later.
2:53
SPEAKER_00: The WASDI crop production report is coming this Thursday, okay, and with an expectation that the winter wheat crop could go down a few more million bushels, and then uh maybe a boost in oil, soybean oil demand, but it's the certain second survey-based winter wheat estimate.
3:11
SPEAKER_00: But all total, we're we're into that seasonal downturn pattern.
3:14
SPEAKER_00: That's clearly what's happening, Tommy.
3:16
SPEAKER_02: Yeah, let's talk about a farmer who's holding old crop, Jim.
3:20
SPEAKER_02: We were begging them you got to sell July at 460, 470, 480.
3:24
SPEAKER_02: We'd ask people to sell cash by calls.
3:26
SPEAKER_02: Once you buy the call, you're you do pay premium for that call, but you your risk is managed, right?
3:32
SPEAKER_02: You made the sale on the old crop, you're starting to make sales on new crop, buy those calls.
3:36
SPEAKER_02: And sometimes they say, Well, I read XYZ and they said corn's going to here.
3:42
SPEAKER_02: Look at the predicament they put them in.
3:44
SPEAKER_02: Now there are farmers holding old crop, they're on the wrong side.
3:48
SPEAKER_02: I told folks when the funds are piling in and have a record long, that is your opportunity to sell it to them.
3:55
SPEAKER_02: Because if you don't, you end up with what just happened this week.
4:00
SPEAKER_02: Now, what's got people scratching their heads is crude oil is still$90.
4:05
SPEAKER_02: And it may have some volatility tonight on the Sunday open due to news coming out.
4:10
SPEAKER_02: So we went from a gift, the Iran US Israel conflict, moving oil up, moving commodities.
4:19
SPEAKER_02: What happened, Jim?
4:20
SPEAKER_02: And we'll talk about it more.
4:21
SPEAKER_02: I guess it's uh a lead-in, but fertilizer prices are still high, gas is still high, the cost of production of the 2026 crop is still high, and now we're trading below crop insurance levels.
4:33
SPEAKER_02: You don't have to answer any of those.
4:34
SPEAKER_02: I guess that was more of a statement than a question.
4:36
SPEAKER_02: You ever have someone do that to you?
4:37
SPEAKER_02: Well, that wasn't a question.
4:39
SPEAKER_02: That was a damn statement.
4:41
SPEAKER_00: We've never said markets are not volatile because they are, and that's not to say we're not gonna make new highs on the move later on, but as you said, timing if you didn't uh reward that significant run-up in the grains that we saw.
4:57
SPEAKER_00: Again, you can't go bankrupt making money.
4:59
SPEAKER_00: My father always told me.
5:01
SPEAKER_00: So, yeah, ring that cash register every once in a while, and then it's gonna take a while for the for the fundamental factors to come into play if we do have higher prices.
5:12
SPEAKER_00: And those fundamental factors are primarily a result of you know, getting this crop known, the June acreage report at the end of the month, so we can really factor in acreage, see if there's any surprises.
5:26
SPEAKER_00: Grain stocks reports come out at the end of the month as well.
5:29
SPEAKER_00: But the biggie, Tommy, that I think will either make or break this market is China.
5:36
SPEAKER_00: And the timeline, even though some uh commentators said that they thought China would come in sooner rather than later, we we did not agree with that because the border trade concept, and we're gonna get into this later, but I think it's a market impact.
5:52
SPEAKER_00: We're not gonna know the full details and the implementation of the border trade relative to the US-China summit between Trump and Xi Jinping until late this summer.
6:04
SPEAKER_00: And that's shortly ahead of Xi Jinping when he comes to the U.S., hopefully in September.
6:11
SPEAKER_00: So we've got this lull here, lull here, and that's why markets are are reacting the way they are, let alone with what she said.
6:20
SPEAKER_00: The the biggest reason is the longs are bailing out.
6:23
SPEAKER_02: Well, I have the uh disclaimer going at the bottom.
6:25
SPEAKER_02: It says right there, therefore, you should carefully consider which such trading suits you.
6:30
SPEAKER_02: It's not for everyone, but what farmers trade is cash grain.
6:34
SPEAKER_02: They have the opportunity to do futures and options, they have the opportunity to do contracts through the elevator, but regardless, we know their position every year, Jim.
6:42
SPEAKER_02: They're cost.
6:43
SPEAKER_02: Let's get back to the show.
6:44
SPEAKER_02: Uh, we went through the markets, let's let's and you touched on that.
6:47
SPEAKER_00: Those are the down, yeah, those are the reasons why.
6:50
SPEAKER_02: We already talked about all that.
6:52
SPEAKER_02: Yes, we have.
6:53
SPEAKER_02: Boy, you're ahead of me.
6:56
SPEAKER_00: We had uh news.
6:57
SPEAKER_00: In fact, it broke over the uh Friday uh evening.
7:01
SPEAKER_00: We had another incident.
7:02
SPEAKER_00: Yeah, this is the breaking news.
7:04
SPEAKER_00: We had several breaking news, but one was the New World's uh New World Screwworm that we had one at the at the midweek um that was announced uh late week, and they're both in the same region of uh Texas.
7:18
SPEAKER_00: And I think we have the counties, the uh county maps of uh Texas that you'll show.
7:24
SPEAKER_00: Yeah, look at down in South Texas, it's Avala County.
7:28
SPEAKER_00: Both of the younger calves were found there, and USDA Secretary Brooke Rollins is gonna have a press event in Texas tomorrow.
7:39
SPEAKER_00: So uh so she's gonna have a private one, and then she's gonna have what we call a presser, a press event with I guess the Texas uh reporters.
7:50
SPEAKER_00: So I don't know whether she'll break any news there.
7:54
SPEAKER_00: But the the the the aspect of the NWS is that it's it's within a 12-mile radius now that they've blocked off.
8:03
SPEAKER_00: Will more cases be announced?
8:05
SPEAKER_00: And if not, how widespread will it eventually be?
8:09
SPEAKER_00: Rollins said that the border is going to remain closed indefinitely, so any plans they had to reopen the US, Texas, US, Mexico border, forget it for right now, and that's gonna mean tight, tight supplies, Tommy.
8:24
SPEAKER_00: And the Food and Drug Administration has approved 12 products to deal with NWS, but there's no medicated feed option yet.
8:33
SPEAKER_00: And I think that's what's really needed, is what I'm hearing from the trade.
8:37
SPEAKER_00: We also have discussed over the past few months the impact on Mexico's cattle, beef, and feed industry as a result of that border closing.
8:47
SPEAKER_00: The longer it remains closed, the more Mexico builds up their cattle beef feeding industry.
8:55
SPEAKER_00: So I think there could be some short-term pain here, yeah, and long-term, you know, pain coming up here.
9:02
SPEAKER_00: The cattle market fundamentals, most people tell me, have not changed.
9:07
SPEAKER_00: But I think you had in Fat Tuesday podcast with Mike Sands, yeah, he's he's a little more nervous on this incident, isn't he?
9:16
SPEAKER_02: Yeah, Mike Sands says a daily show for paid subscribers called Before the Bell.
9:20
SPEAKER_02: We get that out every day at eight o'clock.
9:22
SPEAKER_02: That's a five-minute video for subscribers only.
9:25
SPEAKER_02: Real quick plug.
9:26
SPEAKER_02: If you're not a subscriber, you should be, because all the really juicy stuff, excluding what we do here with Jim, is paid for subscriber.
9:35
SPEAKER_02: And to be a paid subscriber,$25 a month,$250 annually.
9:39
SPEAKER_02: I think you'll find value in that.
9:40
SPEAKER_02: Not only for cattle producers, but livestock, livestock producers and real crop farmers.
9:45
SPEAKER_02: But we, our friend, and you could pump him up, Zachary at Nesvik Research and the whole team that's feeding him stuff, just doing a wonderful job getting research out.
9:54
SPEAKER_02: We get research to paid subscribers and brokerage clients.
9:57
SPEAKER_02: But if you're not a brokerage client, that's okay.
10:00
SPEAKER_02: Keep your brokerage relationship, take the advantage of the$25 a month,$250 annually.
10:05
SPEAKER_02: And of course, we have Craig Solberg on weather, Mike Sands on cattle, Paul Nefer on accounting, Jim Wiesmeyer doing special episodes.
10:13
SPEAKER_02: We don't you don't see all the Wiesmeier episodes because some of them just go to paid subscribers.
10:19
SPEAKER_02: So with that, a little bit real quick plug for Mike Sands.
10:22
SPEAKER_02: I know you have a long-term relationship with him.
10:23
SPEAKER_02: Do tell.
10:24
SPEAKER_00: Oh, he's he's fundamentally and technically he's he's one of the best.
10:29
SPEAKER_00: I mean, I've known him to since the Willard Sparks day.
10:32
SPEAKER_00: So I mean, this goes back decades on that one.
10:35
SPEAKER_00: He's got a booming voice made for radio, and he just does his homework and he knows.
10:42
SPEAKER_00: So when he talks, I do indeed listen because he's been through several major incidents and issues in in the cattle market industry.
10:51
SPEAKER_00: So definitely not only listen to him but follow him.
10:54
SPEAKER_02: How about young Zachary Davis?
10:56
SPEAKER_02: You say he has uh a lot of potential.
10:58
SPEAKER_00: I'll tell you, I I've uh I'm always asked by agribusiness officials who's some up-and-comers in the agribusiness sector.
11:07
SPEAKER_00: And now I tell him Zachary Davis.
11:10
SPEAKER_00: I mean, and I don't say that lightly.
11:12
SPEAKER_00: I mean, there's not many like him that come along.
11:15
SPEAKER_00: I mean, if I had the stamina anymore to train somebody, I would take him on to train, but he's doing quite well without me.
11:23
SPEAKER_00: He's gifted and he's young and he's a good writer and he knows markets.
11:29
SPEAKER_00: That's a dangerous combination.
11:31
SPEAKER_00: So, and you can get him in his uh morning comments every day, of which I remember.
11:36
SPEAKER_02: Yes, absolutely.
11:37
SPEAKER_02: Also, his father, Stephen Davis, and Stephen, who's uh a few a few weeks younger than me, happy birthday, Stephen.
11:45
SPEAKER_02: Stephen was trained, and his first job in the futures industry was with Willard Sparks.
11:50
SPEAKER_02: And that story goes all the way back to Stephen's father, Zachary's grandfather, was Willard's jet salesman.
11:59
SPEAKER_02: And Stephen's father said to Willard, my son just graduated business school.
12:04
SPEAKER_02: What do you think?
12:05
SPEAKER_02: And he said, Get I will tell him to pack his bag, get his ass to Chicago, and the rest is history.
12:11
SPEAKER_02: Steven's a talented trader and a great mentor to me.
12:14
SPEAKER_00: Look at the networking, look at the networking that goes back there.
12:18
SPEAKER_00: And you did say, yeah, one of Willard's uh favorite things was his jets, and and I know that because he would literally fly out when there was a show to look at the new you know, you know, jets coming on.
12:31
SPEAKER_02: That's amazing.
12:32
SPEAKER_02: All right.
12:32
SPEAKER_02: Well, no jets for you, Mr.
12:35
SPEAKER_02: Jim.
12:35
SPEAKER_02: You'll be flying coach back by the bathrooms here.
12:38
SPEAKER_02: Screwworm.
12:39
SPEAKER_02: This this is let's talk a little bit more on this, a little more color.
12:43
SPEAKER_02: Canada came out and uh, I believe they gave the middle finger to Texas beef.
12:47
SPEAKER_02: Is that true?
12:48
SPEAKER_00: Well, they they they say it's traditional that that's restricting the any cattle.
12:53
SPEAKER_00: They don't they don't get any hardly any of uh cattle from southern Texas anyway.
12:58
SPEAKER_00: I mean, just look at the distance there, but that's what on their protocol.
13:01
SPEAKER_00: They did the same thing to Mexico, so I think they're okay to do it.
13:05
SPEAKER_00: It's an isolated area, but again, this is an issue that uh it it doesn't have legs now, but it could.
13:14
SPEAKER_00: And so I I think this is we're at the beginning of this.
13:18
SPEAKER_00: So we're gonna see whether or not there's any more, you know, this coming week.
13:23
SPEAKER_00: It reminds me a lot like the Mad Cow disease, where it started very slow and then we started to pick up the number of cases.
13:33
SPEAKER_00: I hope that's not the case because if we expand beyond that 12 mile radius, then it's gonna become more of a market factor.
13:42
SPEAKER_00: It's gonna constrict movements, it's already, and that's all already.
13:46
SPEAKER_00: I mean, look at the feedlot that's in that uh area of Texas.
13:49
SPEAKER_00: Oh, I feel sorry for them.
13:51
SPEAKER_00: But it it's gonna if you get beyond that 12 mile radius in a market angle, it's almost like breaking a 50-day moving average.
14:01
SPEAKER_00: You know what I mean?
14:02
SPEAKER_02: Yes, sir.
14:03
SPEAKER_00: So watch that.
14:04
SPEAKER_00: That that's gonna be a fundamental thing that traders are looking out for.
14:07
SPEAKER_02: In full disclosure, I did uh ask our favorite friend, Mr.
14:11
SPEAKER_02: Chat, the old AI interweb, how much beef do we import to Canada?
14:16
SPEAKER_02: And how much beef does Canada import in the United States?
14:19
SPEAKER_02: And we do a lot of swapping back and forth, and that's probably that north versus south versus this versus that.
14:25
SPEAKER_02: I believe, uh and I'm half making this up, but I'm pretty confident.
14:29
SPEAKER_02: I believe a lot of McDonald's ground beef comes from a uh packing plant, maybe a cargill packing plant or something from Canada.
14:37
SPEAKER_02: And when you're on the next slide, I will Google that.
14:40
SPEAKER_02: But I remember watching videos about when McDonald's said their quarter pounder is not a hundred percent fresh ground beef, and of course they source ground beef from a lot of people, but yes, also I wouldn't want people to leave scared that Canada's not buying beef.
14:54
SPEAKER_02: That's not true.
14:55
SPEAKER_02: No, but they're it's cattle, it's cattle.
14:58
SPEAKER_02: Okay, it's cattle.
15:00
SPEAKER_02: Let's calm the nerves and let's let people know that as Father's Day comes along in the 4th of July holiday, 250 years for America, it's perfectly, perfectly safe to consume all American beef products.
15:15
SPEAKER_00: Absolutely, absolutely, absolutely.
15:17
SPEAKER_02: All right, well, we've taken the screwworm subject.
15:20
SPEAKER_02: Let's get to the fun, easy stuff.
15:22
SPEAKER_02: Number three, 45Z rule info from USDA coming.
15:26
SPEAKER_00: Well, we've got some progress.
15:27
SPEAKER_00: We reported on Ag Bull Media through my uh updates that the Office of Management and Budget is still reviewing it.
15:35
SPEAKER_00: 15 different meetings have been held with an array of groups.
15:40
SPEAKER_00: It's the foundation for USDA feedstock carbon intensity calculator.
15:46
SPEAKER_00: This is gonna be important because once we get the details from USDA, then we can analyze from a market perspective, from a farmer perspective, whether or not this program's really gonna kick off, whether it's gonna be farmer friendly or not.
16:01
SPEAKER_00: And the tool is the Greek greet model, and that's gonna determine the life cycle greenhouse gas emissions.
16:08
SPEAKER_00: Okay the scores play a big role, Tommy, in determining eligibility and value under the 45Z tax credit.
16:16
SPEAKER_00: The timeline when we're gonna get this, to me, I've been told late summer to early fall.
16:23
SPEAKER_00: But I'm telling you, along with China, the 45Z are the sustainable aviation fuel program, are the two major potential domestic use increases for corn and the soy complex.
16:40
SPEAKER_00: So that's why we're gonna continue to spend time on this until we know the rules and regulations totally.
16:47
SPEAKER_02: Okay.
16:47
SPEAKER_02: Well, you did a good job.
16:49
SPEAKER_02: You're doing good.
16:51
SPEAKER_02: I didn't think we had many slides, but we're gonna go our standard 45 minutes.
16:54
SPEAKER_02: Number four, U.S.
16:55
SPEAKER_02: China Board of Trade.
16:57
SPEAKER_00: Yeah, it's the Board of Trade relative to U.S.
17:00
SPEAKER_00: and China.
17:01
SPEAKER_00: The official register notice is now.
17:03
SPEAKER_02: Not this board of trade.
17:04
SPEAKER_00: No, no.
17:05
SPEAKER_00: The official register, the federal register has been noticed, has been put out, and we needed that.
17:11
SPEAKER_00: The comment period runs through July the 10th.
17:15
SPEAKER_00: The rebuttal comments are due by July 27th.
17:19
SPEAKER_00: That means to me that the timeline of actions by the U.S.
17:23
SPEAKER_00: and China relative to a very important market issue, potential tariff reductions, by both China and the US won't come until after this rebuttal comment period.
17:40
SPEAKER_00: So we're really talking probably August sometime at the earliest.
17:45
SPEAKER_00: So, but I'll tell you this is key because this board of trade is a mechanism to manage bilateral trade between the two world's largest economies.
17:57
SPEAKER_00: Now, Secretary Treasury Secretary Scott Bessett, this week at a Senate hearing, this is a quote: the U.S.
18:04
SPEAKER_00: and China will consider tariff modifications and imports of an equal value of non-sensitive goods from each side.
18:11
SPEAKER_00: Agri uh farm products are non-sensitive.
18:15
SPEAKER_00: During the hearing, Bessett explained how the board would function and he hinted at potential target industries, including agriculture, and claimed the selected items would be this is a quote, tariff free.
18:30
SPEAKER_00: Okay.
18:31
SPEAKER_00: That tells me, oh, that's that makes China would reduce the tariffs on U.S.
18:36
SPEAKER_00: farm products to zero.
18:38
SPEAKER_00: Well, they have an MFN of three percent, but everybody gets that.
18:42
SPEAKER_00: And the US would do likewise.
18:44
SPEAKER_00: That makes U.S.
18:46
SPEAKER_00: commodities very competitive with all countries.
18:50
SPEAKER_00: That tells me that it just won't be state traders in China buying, potentially buying U.S.
18:56
SPEAKER_00: farm commodities.
18:57
SPEAKER_00: It will be their so-called private sector.
19:01
SPEAKER_00: Now, the number that they're talking about in trading uh the tariff-free goods is 30 billion.
19:07
SPEAKER_00: Now, it's not all agriculture, non-critical industries.
19:12
SPEAKER_00: That'll include like fireworks, Halloween costumes, uh, low-end consumer goods that we don't want to uh reshore that we want to buy from China.
19:21
SPEAKER_00: So these are clearly rules coming that'll separate managed trade in non-sensitive goods from genuine national security controls.
19:32
SPEAKER_00: We we will still have national security controls, but here's what that our China watchers tell me China's not going to move before the U.S.
19:41
SPEAKER_00: moves, they're gonna move in sync in a coordinated pattern.
19:45
SPEAKER_00: So those people, if you read the China, uh they're waiting for China to reduce the tariffs on U.S.
19:51
SPEAKER_00: foreign products.
19:52
SPEAKER_00: I I just our China watchers are saying no, China doesn't work that way.
19:57
SPEAKER_00: They want to coordinate with the United States.
20:00
SPEAKER_00: That's why this board of trade is so important, Tommy.
20:03
SPEAKER_02: Very good.
20:05
SPEAKER_02: Well, I'll believe it when I see it.
20:07
SPEAKER_02: Number five, Rowlands face tough questions at House Hearing.
20:11
SPEAKER_02: How do you say his last name?
20:13
SPEAKER_00: Who's that?
20:13
SPEAKER_00: Angie Craig, Angie Craig, Republican from uh she's a ranking member on the House AG Committee.
20:19
SPEAKER_00: Uh no, Angie Craig.
20:22
SPEAKER_00: Okay.
20:22
SPEAKER_00: She's going, she's running for the Senate seat in Minnesota, but boy, she just she got heated questions at uh Rollins.
20:32
SPEAKER_00: Uh, she zeroed in on the ag sector issues, uh, the bankruptcy, the increasing bankruptcies, the low prices, the volatile trade issues, fertilizer, and other input costs, etc.
20:47
SPEAKER_00: Jim McGovern is a Democrat from Massachusetts, and he focused on glyphosate and got into a spirited debate with Secretary Rollins where McGovern spirited saying, well, he just flat out told uh Rollins, he said uh glyphosate kills people.
21:06
SPEAKER_00: So where do you go from there?
21:08
SPEAKER_00: And and Rollins just said uh if you pull it off the shelf right away, you talk about hurting in agriculture.
21:17
SPEAKER_00: And Rollins also commented on cotton.
21:19
SPEAKER_00: I love that this program is just not corn, soy, beans, wheat, and and meats.
21:24
SPEAKER_00: It's also southern crops.
21:26
SPEAKER_00: And she came out in support of the boosting domestic cotton use, especially relative to the king leader in exports now, Brazil.
21:38
SPEAKER_00: And she kept saying the favorite phrase uh uh uh plants, not plastics, and America, not Brazil.
21:47
SPEAKER_00: So she came roundly in support of increasing the domestic utilization of cotton from a quality and identity preserved thing.
21:56
SPEAKER_00: So that was good to hear.
21:58
SPEAKER_00: The bottom line on that it was a uh I I love a hearing like that because even though it was some more than a few kerfuffles, okay.
22:09
SPEAKER_00: It it aired out some issues, and she's going to do the same thing this coming week before the Senate AG Committee, where they're going to have an oversight of USDA, and she's going to bring up the same issues along with USDA's reorganization, which is very controversial to both Democrats and Republicans.
22:28
SPEAKER_00: So we'll have more on that in our next week's podcast, Tommy.
22:32
SPEAKER_02: Okay.
22:32
SPEAKER_02: And you see that I made a mistake earlier.
22:35
SPEAKER_02: Commas and spaces matter because I kept saying Craig Zeros, never heard of us last name.
22:40
SPEAKER_02: But when you mess up as bad as that, you got to call yourself out.
22:44
SPEAKER_02: It should say rep Craig Space zeros in on sector issues.
22:49
SPEAKER_02: Yeah.
22:50
SPEAKER_02: And uh hey, I love making my own blooper real life during the show because even Jim makes mistakes once in a while.
22:58
SPEAKER_02: Right it down.
23:00
SPEAKER_02: Partnering up with me.
23:01
SPEAKER_02: All right, real quick, uh moving along.
23:03
SPEAKER_02: Number six, India trade agreement progress.
23:06
SPEAKER_02: Let's have some good news.
23:07
SPEAKER_00: Yeah, well, I'll believe it when I see it.
23:09
SPEAKER_00: However, I'm not gonna poo-poo it because some top officials, including President Trump himself, is upbeat on a final agreement before July.
23:18
SPEAKER_00: And Trump basically said it's because of his relationships, his relationship with India's prime minister Modi.
23:25
SPEAKER_00: India is a major alternative to China for manufacturing, technology, and agricultural trade.
23:32
SPEAKER_00: So you think India is not important?
23:34
SPEAKER_00: Wow, they have a very similar number of people there.
23:39
SPEAKER_00: They are very protective in India of their agriculture, the sensitive areas.
23:45
SPEAKER_00: So I'm gonna believe it when I see it, because India usually takes you up to the five-yard line before they stop.
23:54
SPEAKER_00: So I I hope, I hope U.S.
23:56
SPEAKER_00: trade rep Jameson Greer's positive attitude that something's gonna happen and Trump's positive attitude are gonna be uh uh uh acted on in agreement before some July deadlines that Trump has set up.
24:11
SPEAKER_00: That's the bottom line.
24:12
SPEAKER_00: Watch it because if you want true additionality, farmers, in in U.S.
24:17
SPEAKER_00: trade, one of the potential big areas is India.
24:22
SPEAKER_02: Let's take a little commercial break here.
24:23
SPEAKER_02: We're halfway through the show.
24:24
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24:26
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24:29
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24:49
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24:50
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24:55
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25:03
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25:05
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25:05
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25:11
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25:22
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25:24
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25:27
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25:30
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25:31
SPEAKER_00: I like their summary of the news.
25:33
SPEAKER_00: Like on uh over the weekend, they'll have summaries of uh Barron's the major articles, and during the week, they they they scan all the major newspapers and do a very succinct and brief headline and not just headlines, but a little the meat of what the article's about.
25:51
SPEAKER_00: And that's very helpful to me, Tommy.
25:53
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26:03
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26:07
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26:10
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26:15
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26:17
SPEAKER_02: I I find even my wife Gina, she'll say, Oh, she'll be down here working.
26:21
SPEAKER_02: She's like, Wow, what just happened?
26:22
SPEAKER_02: It sounds really serious.
26:24
SPEAKER_02: I said, It is serious.
26:25
SPEAKER_02: There's a lot of serious stuff going on here in the world.
26:27
SPEAKER_02: Let's get back to the show.
26:28
SPEAKER_02: Number seven, Senate Farm Bill coming mid-June.
26:31
SPEAKER_00: Yes, that means uh this coming next week.
26:34
SPEAKER_00: The Senate Ag Committee, Bozeman, John Bozeman, Republican from Arkansas, says that he'll release the text of the Senate Farm Bill.
26:42
SPEAKER_00: The key issue is going to be a state's share of food stamp cost.
26:46
SPEAKER_00: That's his good compromise, I think, in order to get a bill through the Senate.
26:51
SPEAKER_00: Uh, he's working with the ranking member, Amy Klobuchar, Democrat from Minnesota.
26:57
SPEAKER_00: He wants no language that's sensitive in his bill.
27:01
SPEAKER_00: So that means that year-round E15 will not be in the Senate bill to me.
27:06
SPEAKER_00: That means the proposition 12 end around for California's Prop 12 will not be in the Senate farm bill.
27:12
SPEAKER_00: And it also means that pesticide labeling language will not be in the Senate farm bill.
27:19
SPEAKER_00: He said that they'll that the he wants the Senate AG Committee to mark up the bill sometime by the end of the month.
27:27
SPEAKER_00: Now that's an expedited timeline, but we're gonna see.
27:31
SPEAKER_00: He's been saying that for like a month now.
27:33
SPEAKER_00: So first he's got to issue the actual language of the bill, check when he does, check to see what the Democrats' response on that bill is, whether it's gonna be more bipartisan than what most people say is a partisan house farm bill that passed.
27:51
SPEAKER_00: So that's the bottom line.
27:53
SPEAKER_00: Uh, coming news.
27:54
SPEAKER_00: First, we have to get the bill released, and then we're gonna have to have the markup on the Senate floor, which there could be some spirited amendments there, Tommy.
28:03
SPEAKER_02: I love your adjectives and stuff.
28:04
SPEAKER_02: Spirited, good stuff.
28:06
SPEAKER_02: Number eight, your round E-15 update in Senate, the subject that just doesn't ever go away.
28:11
SPEAKER_00: No, I did a big, I'm telling you, I spent a lot of time on this issue this past week.
28:16
SPEAKER_00: And again, it's on AgBolmedia.com as a special report.
28:21
SPEAKER_00: As far as E-15 in the Senate, there's some hurdles.
28:25
SPEAKER_00: I want to emphasize this is not a mandate, nobody's mandating service stations to offer it, even.
28:32
SPEAKER_00: The key is two things the SRE eligibility, the small uh refiners eligibility, who qualifies for it, Tommy, and reallocation.
28:44
SPEAKER_00: If there's any uh waivers, how much, if any, is gonna be reallocated?
28:50
SPEAKER_00: That's what we're gonna look at in the Senate bill's language whenever it's released.
28:55
SPEAKER_00: If it changes from the House bill, which I think it will, then it's gonna have to go back to the House.
29:02
SPEAKER_00: And will the House like those changes?
29:04
SPEAKER_00: What's the legislative vehicle in the Senate?
29:08
SPEAKER_00: I've already said it won't be on the farm bill.
29:10
SPEAKER_00: It's too controversial, and there's jurisdictional issues there.
29:14
SPEAKER_00: It's probably gonna be attached to a must-pass, if it does, to a must-pass bill.
29:19
SPEAKER_00: And usually that's a spending bill or a ag disaster aid bill, something like that.
29:25
SPEAKER_00: Or it could wait until lame duck session of Congress after the November 3rd midterm elections.
29:32
SPEAKER_00: Even if it's approved, Tommy, it's gonna be slow growth from the current only 4,500 stations right now offer E15.
29:41
SPEAKER_00: That's primarily in the farm belt states of Iowa, Minnesota, and Illinois.
29:46
SPEAKER_00: That should not be surprising.
29:48
SPEAKER_00: But how do you attract those other states to get the tanks, the proper tanks, and the pumps?
29:55
SPEAKER_00: And I think it's gonna be later rather than sooner on the growth, but it still will be a step in the right direction.
30:02
SPEAKER_00: You need year-round E15 to continue the growth because each year we're gonna sell more hybrid cars and more electric vehicles, which means less gasoline will be consumed.
30:15
SPEAKER_00: And that drives the gasoline consumption, drives the renewable fuel standard mandate.
30:21
SPEAKER_02: And that brings a question I have to ask you.
30:24
SPEAKER_02: You bought a uh electronic hybrid.
30:26
SPEAKER_02: Uh, what brand did you buy?
30:27
SPEAKER_02: Tell us how you're doing with that.
30:28
SPEAKER_00: Hyundai Santa Fe.
30:30
SPEAKER_00: Hyundai is not sponsoring the show, but if they'd like to, I'm telling you, it's one of the best, they're one of the best auto manufacturers now, a 10-year warranty, 100,000 miles.
30:41
SPEAKER_00: And I'll tell you, I'm a true believer in hybrids.
30:43
SPEAKER_00: I get 32 miles a gallon in city driving, going from my house to the supermarket.
30:51
SPEAKER_00: It's like an electric vehicle without having an electric vehicle.
30:55
SPEAKER_00: I don't have to wait to charge the battery.
30:57
SPEAKER_00: So I'm telling you, I if you want to save money, it takes about three years for a break-even for the additional cost to buy uh uh a hybrid in order to balance it out, which that's why I think there ought to be tax advantages to buy a hybrid.
31:13
SPEAKER_00: If they want affordability, if they want to talk affordability in this town, whether you're at the White House, Congress, Democrat, Congress, Republican, why wouldn't they uh uh pump uh hybrid cars?
31:24
SPEAKER_00: Now, if they do, they gotta have a tax incentive for E15, because again, the more hybrids you sell, the fewer gallons of gasoline you use.
31:34
SPEAKER_00: So it's a balancing act here.
31:35
SPEAKER_00: But I'm a true believer now in hybrids.
31:38
SPEAKER_00: I've seen the future and it's hybrid cars.
31:41
SPEAKER_02: Okay.
31:41
SPEAKER_02: Yeah, I'm looking at their website here, and you got me thinking because I'm you have a Santa Fe.
31:46
SPEAKER_00: These are uh Santa Fe, uh the upscale one.
31:49
SPEAKER_00: It's beautiful, beautiful.
31:51
SPEAKER_00: It's the best interior of a of a mid-sized SUV that uh I I was able to find.
31:58
SPEAKER_00: I just love it.
31:58
SPEAKER_00: I just love it.
31:59
SPEAKER_02: Well, it gets you thinking things be uh changing here in the world, Jim, and we got to change with them, right?
32:05
SPEAKER_02: Sure, absolutely.
32:06
SPEAKER_02: Let's get to number nine.
32:07
SPEAKER_02: Speaking of changing, how about elections?
32:09
SPEAKER_02: What a nice lead in there.
32:10
SPEAKER_02: Number nine, primary election results.
32:12
SPEAKER_00: Yeah, we we had some signals going on that Trump endorsement didn't work for everywhere.
32:17
SPEAKER_00: We found that he his candidate for governor in Iowa, uh, Feinstra, lost.
32:24
SPEAKER_00: So I'm telling you, the Democrats sense an opportunity in Iowa, not only at the Senate level, although the Republicans have a very good candidate, but they the Democrats do as well.
32:37
SPEAKER_00: But the governor's race is gonna, it's gonna be they the the Democrats have a really formidable candidate, Tommy.
32:47
SPEAKER_00: So in in uh I think I have well, yeah, coming up today.
32:54
SPEAKER_00: Once I put out my week ahead, I've got an item on this that the governor's race in Iowa could matter because their their the democratic um choice is is getting uh is making a lot of waves in in Iowa.
33:13
SPEAKER_00: Rob Sand is his name.
33:15
SPEAKER_00: He could help drive the turnout among Democrats and improve the Democratic performance statewide.
33:22
SPEAKER_00: So even though I said Senator Henson from Representative Henson now, she's the Republican candidate for Iowa, she's very popular, she's built up a lot of money, so she's gonna be a formidable force.
33:36
SPEAKER_00: But Iowa's gonna be a very competitive state.
33:42
SPEAKER_00: So if the Democrats have a chance to take over both the House and the Senate, it could well go through Iowa.
33:50
SPEAKER_00: So I was I was gonna be key.
33:51
SPEAKER_00: Yeah.
33:52
SPEAKER_02: While you were speaking, Jim, I pulled up poly market and looking at the Iowa governor election winner, there's a 38%.
33:58
SPEAKER_02: These are betting markets, not something that uh anyone you just Google.
34:03
SPEAKER_02: All I did was Google Iowa governor election winner betting odds and said 38 Republican, 63 Democrat.
34:11
SPEAKER_02: One thing I will say about the gentleman who won the uh Republican side was that he spent an incredible amount of time being on a bunch of very, very successful podcasts in Iowa.
34:25
SPEAKER_00: Yeah, Josh Turk.
34:27
SPEAKER_00: Yeah, he won with nearly 64 percent of the vote, and so that's why the handicappers are taking a second look at the right re uh at the race to replace retiring Republican Senator Joni Ernst.
34:40
SPEAKER_00: Now, the Cook political report shifted the contest from likely Republican to lean Republican.
34:47
SPEAKER_00: They still think Republican Henson's gonna win, but they reflected the growing Democratic optimism.
34:54
SPEAKER_00: It's interesting that Turek uh brings an unusual biography to the race.
35:00
SPEAKER_00: As you said, he's a paralympic gold medalist who won legislative races in the Republican-leaning territory.
35:07
SPEAKER_00: So he's a prairie populist.
35:10
SPEAKER_00: He focused on health care, housing affordability, wages, and middle class economic concerns.
35:16
SPEAKER_00: Those are all winning issues if you're talking about them, where Feinster really didn't spend the time to debate, and I think he paid the consequences.
35:25
SPEAKER_02: The gentleman I'm talking about who is on all these podcasts, may I want to just make sure we're talking about the same guy, Zach L A H N.
35:33
SPEAKER_00: Oh, now that's the uh Republican.
35:36
SPEAKER_00: That's the Republican.
35:37
SPEAKER_00: Yeah.
35:38
SPEAKER_02: Yeah, this gentleman, Zach, has been on so many prominent Iowa-based podcasts, and they are getting, you know, if a podcast normally has 50,000 views, he was joining these Iowa shows and having 200,000 views.
35:51
SPEAKER_02: And that very much reminds me of when President Trump was on someone like Theo Vaughn or Joe Rogan.
35:57
SPEAKER_02: I mean, going to these podcasts to tell your story, you talk about the ultra-left media, the ultra-right, just go down the street and find a podcast and tell your story.
36:07
SPEAKER_02: And the thing is that's amazing is that his podcast that I listened to was two hours and 40 minutes long, and I listened to the whole thing.
36:14
SPEAKER_00: See, the Wall Street Journal in an editorial that's out was out yesterday, quote, in the goober in the governor's race, Republican farmer and businessman Zach Lon's win over Trump endorsed Feinstra is another sign of farm belt discontent.
36:33
SPEAKER_00: If Republicans lose the house and set it in the fall, Iowa could be ground zero.
36:38
SPEAKER_00: That's a direct quote, Wall Street Journal.
36:41
SPEAKER_02: Wow, you just pulled that one out of the keister.
36:44
SPEAKER_02: I'm liking it, and that's good.
36:47
SPEAKER_02: Number 10.
36:48
SPEAKER_02: Structural change or just another down cycle?
36:51
SPEAKER_02: And you have a lot of talking points here.
36:53
SPEAKER_00: Special report that we put out on this, and I'm telling you, uh got a lot of emails and calls.
36:59
SPEAKER_00: Is this a cyclical downturn that will eventually correct itself, or is this signal structural changes that will permanently alter profitability, land values, investment decisions, and farm business models?
37:13
SPEAKER_00: I kind of think it's going to be a combination of both.
37:16
SPEAKER_00: We have a changing global competitive landscape because of Brazil.
37:20
SPEAKER_00: Demand growth has changed because of China, either they're in or out.
37:25
SPEAKER_00: Policy uncertainty is a large business factor now and probably in the future.
37:31
SPEAKER_00: We have a widening gap between cost and revenue.
37:34
SPEAKER_00: That's their input cost.
37:36
SPEAKER_00: The U.S.
37:37
SPEAKER_00: still retains major competitive advantages.
37:40
SPEAKER_00: So don't get down.
37:41
SPEAKER_00: The bottom line, Tommy, in my special report is that management decisions, cost control, market diversification are going to matter more than waiting for the next commodity price run-up.
37:54
SPEAKER_02: Say that one more time.
37:56
SPEAKER_00: Management decisions, cost control, and market diversification.
38:01
SPEAKER_00: That means exports and domestic use are going to matter more than waiting for the next bull market.
38:08
SPEAKER_00: So that's a change.
38:09
SPEAKER_00: That's true.
38:10
SPEAKER_02: Yes, sure.
38:10
SPEAKER_02: It is.
38:11
SPEAKER_00: I'm seeing I'm giving a major speech on cotton.
38:14
SPEAKER_02: A major speech, like all your speeches aren't major speeches.
38:17
SPEAKER_02: Hello.
38:18
SPEAKER_00: For me, what do you think cotton is major?
38:20
SPEAKER_00: Because I have to do so much research because it's not carn and soybeans.
38:24
SPEAKER_00: But these are the same things I'm gonna tell the cotton crowd.
38:28
SPEAKER_00: That's what's happening with cotton, too, because of Brazil, because of they're such a formidable force.
38:36
SPEAKER_00: And they before the trade, before Brazil for that, what's going on here?
38:42
SPEAKER_00: Yeah, the Brazil is the uh largest cotton exporter now.
38:48
SPEAKER_00: Before the first trade war with China in 2018, the US was the world's cotton, world's largest cotton exporter.
38:57
SPEAKER_00: That tells you the difference.
38:58
SPEAKER_02: You ever go to those meetings, Jim?
39:00
SPEAKER_02: You know, imagine you were at your meeting giving that big speech and cell phones were ringing.
39:04
SPEAKER_02: I mean, wouldn't you think that was rude?
39:06
SPEAKER_02: I mean, come on, can't believe they let you back on the show.
39:09
SPEAKER_00: I can't find my phone.
39:11
SPEAKER_00: That's okay.
39:11
SPEAKER_00: I think it's upstairs where I couldn't turn it off, but it rings on my computer.
39:16
SPEAKER_02: As long as you don't have one of those keychains around your neck that you hit the button that says, Help, I fell down.
39:22
SPEAKER_02: Hey, uh, real quick, we're having fun and we're at the end.
39:25
SPEAKER_02: I want to thank everyone for joining.
39:26
SPEAKER_02: I want to tell you real quick that uh, and Jim will tell you Weiss Meyer's Perspectives and all his content is moving to the AgBo website.
39:33
SPEAKER_02: A chunk of it'll be free.
39:34
SPEAKER_02: And of course, uh, special videos he does outside of Weissmeyer's Perspectives with myself and Paul Nefer and stuff, those are all on the pay for platform.
39:41
SPEAKER_02: So you'll need to uh move over there.
39:43
SPEAKER_02: If you'd like to join,$25 a month,$250 annually.
39:46
SPEAKER_02: I think it's a small price to add for what you get.
39:48
SPEAKER_02: Uh, you get a morning email summary, day daily commentary and updates, special alerts and notification via text and email.
39:55
SPEAKER_02: And of course, you have the members only dashboard where you can click and see uh all the content we're putting out.
40:00
SPEAKER_02: $250 a month.
40:01
SPEAKER_02: You want to save a little money,$250 annually, try it for a month.
40:04
SPEAKER_02: If you don't like it, cancel it, cost you$75, 80 cents a day.
40:07
SPEAKER_02: With that, uh, you're gonna spill more gas this week than this service cost you.
40:11
SPEAKER_02: I do want to ask you, sir, your travels and then take us home.
40:15
SPEAKER_00: Vale, Colorado, Wednesday, Thursday, Friday.
40:18
SPEAKER_00: Uh actually, I speak Saturday morning.
40:21
SPEAKER_00: Uh I love the cotton industry.
40:23
SPEAKER_00: And I've got the good news I'm gonna tell them is I I'm uh wearing a hundred percent uh out there cotton shirt.
40:31
SPEAKER_00: But the bad news is that since I'm on GLP one Wagovi, I've already gone from extra large two to extra large and soon will be large shirts.
40:42
SPEAKER_00: So I won't have as much cotton in my shirt.
40:45
SPEAKER_02: Absolutely, absolutely.
40:46
SPEAKER_02: Do you have some more optimistic news?
40:48
SPEAKER_00: But wait, the optimistic news, the optimistic news is that we're gonna have to wait a little while, chill out, and let this uh domestic utilization kick in, which we keep on saying.
41:00
SPEAKER_00: I I'm gonna put a lot of weight on this China business gonna come up, Tommy.
41:04
SPEAKER_00: Sink or swim.
41:05
SPEAKER_00: I I sense a turnaround, at least short term in agriculture, once we start seeing proof, and I don't I don't blame the market for wanting proof from August forward, and that's typically when China buys U.S.
41:19
SPEAKER_00: foreign products anyway.
41:20
SPEAKER_00: Once we get the Board of Trade underway, and look at what we discussed today.
41:25
SPEAKER_00: Once we get the China business going again, not just for corn, not just for soybeans, but sorghum, Milo, for their liquor industry, cotton, hopefully, that may get you to 90 cents eventually, maybe.
41:37
SPEAKER_00: Beef.
41:38
SPEAKER_00: They they want our beef.
41:40
SPEAKER_00: And then once once we get in the late summer, early fall, the rules and regulations final for the 45Z program of sustainable sustainable aviation fuel, then we're gonna see whether or not it's gonna be a really solid kick-up in demand for domestic utilization of corn and so and soy complex needs to fulfill those sustainable aviation fuel feedstocks.
42:07
SPEAKER_00: In June this month, we're gonna get the proposed uh renewable fuel standard mandate levels, RVOs they call them, for 2028 renewable fuel standard program.
42:18
SPEAKER_00: So we've got a lot of information that's gonna come out in the next month to three months.
42:23
SPEAKER_00: And I think it's going to put in the lows and start us going back up after this seasonal downturn in prices.
42:33
SPEAKER_02: I like that optimistic spin.
42:34
SPEAKER_02: Well, I wish you safe travelers until next time.
42:37
SPEAKER_02: We Spanish Perspective, Jim and Tommy G checking out.
42:40
SPEAKER_02: See ya, buddy.