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Oct 16 | Commodity Week · Commodity Week

• 0:00
  announce: Todd Gleason services are made available to WILL by University of Illinois Extension. This is the October 16 edition of Commodity
• 0:08
  Todd Gleason: Week. I'm Illinois Extension's Todd Gleason. Thank you for being with us today. Panelists include Aaron Curtis of Midco.
• 0:15
  He is in Bloomington, Normal, Illinois. Arlen Suderman joins us from Stonax in Kansas City, Missouri. And John Zanker is here from Risk Management Commodities. It's a division of Zaner Ag Hedge. He's out of Lafayette, Indiana.
• 0:29
  Commodity week, of course, a production of Illinois public media. You can find and listen to the whole of the program anytime you'd like at willag.0rg. And there now, you'll find a way to register for the farm assets and the Illinois Farm Economic Summit conferences. Both are listed there. They are December 12 for the Farm Assets Conference in Bloomington at the AGRA Center.
• 0:54
  You'll find all kinds of details about that event. It's day long. And then the Illinois Farm Economic Summit's with the ag economist, and they'll be at the Farm Assets Conference too, but a shorter version on the Illinois Farm Economic Summit's half day events that will take place the following week on the fifteenth, the sixteenth, and seventeenth in DeKalb, Peoria, and Mount Vernon. And you are allowed to come and ask questions of the ag economist at the U of I either event. All the details for both are online at willag.org.
• 1:26
  Get yourself registered today. The Anchor Center is smaller venue, so there is a limited number of seats. So get yourself registered, and we'll see you on the December 12 or the following week. And one of those, actually, I think you probably should go to both. Now let's turn our attention to the marketplace and our panelists today, and we'll get a list of items that maybe we should discuss.
• 1:49
  Aaron Curtis, what's been on your mind this week?
• 1:51
  Aaron Curtis: Well, we had a nice, little three day bounce here on corn. We've been in largely a twenty cent range in corn for the last six weeks. So I guess the question is, you know, every time we kinda get back up in this mid to high twenties on Dees corn, we kinda run out of steam. Can we, do anything with it this time around or not?
• 2:09
  Todd Gleason: That is a good question, Arlen Suderman. I don't want you to answer that yet, but if you could give me a list of items that maybe you'd like to talk about today too.
• 2:18
  Arlan Suderman: Rare earth minerals and magnets, something a lot of people don't understand, but they are changing the dynamics of the negotiations now that have implications for soybeans.
• 2:27
  Todd Gleason: And John Zanker at RMC, your list.
• 2:31
  John Zanker: Well I'll stick on that China thing but point out that here we are into the second week in October no Chinese sales on the books. Probably not going to be many Chinese sales on the books for several weeks And October being October, November, those two big months, we need to see something happen or the show is gonna be over here pretty soon.
• 2:54
  Todd Gleason: Well, this show is going to go on for a little bit, so let's continue. I want to pick up, Arlen, with the question that Aaron Curtis had after a three day bounce and pushing above moving averages, particularly the hundred day in the December corn on Thursday. Can it continue to make inroads to the higher side? And if so, why would that be the case?
• 3:18
  Arlan Suderman: Well, we presume that we're getting into the second half of harvest now. And typically, we oftentimes will put in the harvest, not a harvest load necessarily. I think we may have already put that in back in August, but we tend to put in a low right around the midpoint as we find storage places for the crop. We're able to put it away and farmers don't like the price. So they hold on, particularly with the promise of money coming from the administration and maybe a second payment coming from Congress tend to hang on.
• 3:51
  What I'm watching has been the national average cash price this year. It is run almost identical to a year ago. It's been following the same pattern ever since the September 1. And so as we look at it, this was the time a year ago when it started to slowly climb higher. That doesn't mean I'm bullish about corn prices by any means, but demand is strong, and it takes several 100,000,000 bushels per week to keep that pipeline flowing.
• 4:19
  And just that draw on a weekly basis can start to firm prices up and start to pull us higher. And I think that possibility exists here for corn because of strong demand. And even when you look on a global side, our global stocks to use ratio has been trending lower for the last decade and continuing to do so. And I think that works in our favor as well.
• 4:43
  Todd Gleason: Aaron Curtis, do you have an answer for your own question?
• 4:46
  Aaron Curtis: Yeah. I think, I agree with Arlen that typically when we get past that 50, I mean, you know, we're probably 60% done here in Central Illinois. So obviously kind of over that halfway point. Question, I guess probably is we know that quite a bit of space was used this year for beans just because of the basis situation and yields on beans held in there relatively well considering expectations, being that it was extremely dry here at the end of the summer in a lot of parts of the Midwest. So, do we have a little bit of a bean space that's capitalized corn space as we get a little further into harvest?
• 5:22
  We're gonna know that here in the next week to ten days, a little bit of a weather event coming in this weekend, but after that, it looks pretty clear again. So it looks like we're gonna see quite a bit of harvest done on corn here in the next ten days. So we'll find out if we need to move some more corn and or put it into some other space, be it the ground or as you say, but I think we also continue to watch this $4 cash mark on corn. So we're approaching that area or if not exceeded in some parts of the Midwest. So we know the farmer went into harvest extremely undersold.
• 5:57
  So we've been seeing that $4 cash mark let loose us a bushels from the producer standpoint as well. So we'll see, we're able to trade above the one hundred day moving average or right at it today. We got the two hundred day moving average setting up there around $4.38. We've got this little gap area from the summer back there around $4.32 and three quarters. So, we get up into that $4.30 mark from a technical standpoint, we've got some junk to kind of get through in order to get this thing going.
• 6:29
  But I agree with Arlen. The the demand base, for corn is strong, and I think, corn's got a pretty decent floor underneath it.
• 6:35
  Todd Gleason: John Zanker, do you have a dissenting view at all?
• 6:38
  John Zanker: Not at all. Agree with both Arlen and Aaron on that. I think we can move this higher due to demand and that the biggest question maybe we have is what's Iowa going to do with their corn yield? We just continue to hear all kinds of yields. And, you know, I'm personally as confused right now about the state of Iowa as I've been on about any state in the last forty four years.
• 7:05
  So, you know, as soon as we get a little better direction on what's going on there, we'll have a little bit better idea on how high we can take this. But with the acreage increase, we can take the national yield down to 172 and it's still the largest production in history. So, we have a lot of corn and we're not going to 172, but we can certainly go to 180, 181, 182. While that might sound bullish, we need to remember we picked up $195,000,000 on the stocks report and the USDA is probably at least $300,000,000 high on feed. So, we we will need to use these rallies to get, some additional sales on, I believe in the coming weeks.
• 7:49
  Todd Gleason: Well, that brings me back to you, Aaron, and I had a couple of questions about some things that you mentioned. So the idea that storage, might be tight, I think, is what you're telling me for the second half. What impact does that have on basis? And then for those who are delivering across the LL across the grain scale and having to make a decision within a few days, to as to whether they need to whether they want to sell it or to store it, how do they make that decision? What should they be thinking about as it's related to the in charge, and the price that they're looking at on your spot bids?
• 8:28
  Aaron Curtis: Yeah. So the question is, you know, what does it cost you to get to January or March or whatever that period of time is? You know, what's your storage cost? You know, and what is your expectation? I think some of it in the the pricing that we've seen, Todd, is just the expectation is maybe there's not a lot of upside in this market, especially if the trade war continues.
• 8:51
  So that's been influencing a little bit of sales. I think it's probably no secret, right? That there are some aspects of the farm economy that are getting tight, obviously, right? So farmers need some money in some instances, margins are tight. So that's influenced sales.
• 9:08
  And like I said, we went in with 5% to 10% of the corn crop and soybean crop bought. So just to get up to average levels, for say 30%, 40 average across the scale, that's tend to going to show a bigger percentage maybe of normal being sold across the sale. So $10 cash beans when we've seen those in some instances, mostly early on in bean harvest and $4 cash corn have been magic numbers, to buy some grain. So the combination of beating some money and just the anticipation that maybe this market doesn't have a lot of upside to it, have increased some farmer selling across the scale.
• 9:48
  Todd Gleason: Arlen Suderman, I'd like you to follow-up on these thoughts, and to put into some perspective, Frank Olson, agricultural economist, North Dakota State University, and I have had conversations in the past thinking about what does the the the in charge mean? What's that cost? What's the carrying charge at home in the bin? And he says that everybody that's in the industry does a really good job of of figuring out what the interest of the carrying charge might be to get from month to month to month. And to be honest, from his perspective, it costs the same at home in the bin too nearly or probably does.
• 10:26
  So how do you and most producers won't think of it that way, but it really is that kind of cost, I think. So how do you put it into perspective for them?
• 10:34
  Arlan Suderman: Yeah. It really is. And, you know, we've been hearing about some free DP, but with drop charges as well, and that's just another way of the elevator capturing the carry that it's gonna gonna put at risk in order to do so. So when you look at the carry that's in the market, what opportunities there may be, you look at the basis improvement, Stororage costs and d particularly today's higher interest rate. Multiplying that out times the value of that grain versus what you could get.
• 11:06
  Nobody wants to accept week basis. Because you can't ever recapture that. But if you can get some decent basis, once you look at that storage cost and you look at the carrying charges that are there, you might be able to do just as well get unloading it and being able to buy a call option or something and re owning it in that way or some type of derivative strategy for re ownership and then not having to worry about the downside risk quite the same and be able to move that grain if you're having storage problems or something like that. The main problem right now is but many of them are still weaker than what the farmer would rather have.
• 12:00
  Todd Gleason: John Zanker, I want you to follow-up, but Aaron, I'm going put you on the spot and make sure I'm correct. You did tell me that you were looking forward to the second half and that basis could come under pressure from just the amount of storage that has been taken up by soybeans in places.
• 12:16
  Aaron Curtis: Yeah, I think that's still the question, right? It's more of a question. Are we going to see some spots, right, that have a little challenge putting the crop away, right? So far, know, corn basis has been relatively steady here over the last few days. We've seen some improvement in soybean basis now that that harvest is relatively wrapped up, but I think it's more of a question, Todd, are we going to see some continued, we could see some continued weakness on corn basis depending how challenging this last, 30% of the corn harvest, is to put away.
• 12:51
  Todd Gleason: So, John, what are you telling producers that are calling and asking you what to do?
• 12:55
  John Zanker: Well, I just had a call from a, one of my North Carolina customers and, you know, what do we need to do with the rest of this corn? He has a pretty decent corn basis out there and, you know, we've, hey, let's, I'm okay rolling it. I do expect a little bit more push in this board. But we have to be really careful if we go back to, the year before this one last year, you know, we, we, we had a nightmare at the end of the summer And we're in the middle of the summer into the end of summer. Having role basis in a big carry market, DP was just a nightmare.
• 13:33
  So we need to be careful with all those things. And you know, at some point, but let's put the money in the bank. We can do some forward pricing, pick up the carry. And, you know, if you're coming off the farm here, you know, I I'm okay with the short term basis just with the idea that, you know, this market might have some pop in and beans. I'd be very, very, very careful there.
• 14:02
  And, you know, there could be a better strategy just looking at, taking the price. If you want to reown in in the options market, there'll be some opportunities there.
• 14:11
  Todd Gleason: I wanna stay with corn for just a moment, Arlen. What are you hearing on the intelligence from what from Iowa as to the impact that Southern Rust has had. And I know there are places clearly that there are issues. The question is, is that wide enough spread to really make a difference or not? And then here in Illinois, I think maybe the corn is slightly better than they expected.
• 14:36
  Certainly the soybeans were.
• 14:38
  Arlan Suderman: Yeah, I definitely agree with you on soybeans and to some extent corn as well. A tremendous amount of variability. We get daily yield reports in here and I was just looking over those yield results. And what I see the number of times a farmer will report, okay, I had these fields across the road from each other planted at the same time. I sprayed the one, I didn't spray the other, or maybe I sprayed the one twice and I only sprayed the other one once.
• 15:04
  And it's between twenty and seventy bushel per acre difference in yield. A lot of variability in that, but 70 bushel I've seen several times in the yield difference when no treatment versus one or two treatments. So I had a big impact on yield. So what does that do to state average yield with that kind of variability? You would think that it probably proves a drag to it.
• 15:30
  And I I do think that that's probabably true, particularly for I Iowow. We'll see some drag in that yield. But let's keep in mind, they're seeing record yields in the Dakotas and parts in Nebraska as well. And even on soybeans or one farmer there indicated that his soybean yield is gonna be 20 bushels over his previous farm record.
• 15:51
  Todd Gleason: Just to lay some kudos out to the land grant plant pathologist in early July when this first came in, they said this is a problem. It is a huge issue late in the year, and you are likely that you're going to need to spray. They had that listed. They said it over and over and again. We had it on the air many times, but I don't know how widespread.
• 16:14
  It's hard to spend that much money, I suppose, when when the price of porn was so low, trying to get there. And, really, it was about scouting and whether it was in the field or not as much as anything else. Okay. So I do wanna take up some other things. John Zanker, let's start with China and begin on the soybean side.
• 16:37
  No sales at this time. President Trump and president Xi having a spat in the last week over something that seemed to be in place already, of course, The United States. And we'll get to the rare earths in just a minute. But in The United States, there there was already a push on to do port charges. The Chinese said, you know what?
• 17:00
  We're gonna do port charges too. Things spiraled out of control for a moment. How concerned are you, I suppose, about trade deals in general? And I don't know. Maybe we everybody can go with a yes or a no on this to begin with.
• 17:16
  Will we sell soybeans in this calendar year to China still or to any great amount? And everybody says, yeah. No. There were no answers. So we're gonna go we're gonna go with no no to great any great amount on that one.
• 17:32
  Okay. So, now, John, what what what is it that you has you concerned, and how concerned are you as it's related to trade?
• 17:41
  John Zanker: Off the charts concerned, to be honest. You know, Arlen, you've been talking about this since February, and, I've been talking to my customers about it since February, and we've, you know, we've we've been hedging since February. And not just from a trade perspective, but in February, we knew we were going to have a huge South American crop, and it turned out that way. And then as the trade war drug on, we saw China buying a huge amount of beans over and above normal in May, June, July, August, even September. I believe Stone has, they're estimating, Chinese stocks reserves at 18,000,000 tons above what we've seen on average here in the last few years.
• 18:32
  They started building those stocks even a year ago. So they've been preparing for this moment. And, if you look back at last year, I believe October, November, seven fourteen million, seven fifteen million bushels, we exported 62% of those went to China. That's four forty three million bushels, 24% of the yearly total. There aren't going to be any being shipped to China in October.
• 18:58
  Can something get done at the end of the month to, get some boats moving in November? I don't that's a real tight schedule. So I think the best we can hope for is maybe some kind of deal that might, let China start looking at rebuilding the reserves that they're going to use up or they're going to use, not use up certainly, but use in October, November. And the Chinese government can come in and buy US bushels without any tariffs. So I think that there could be some beans moved to China in December and January.
• 19:34
  But again, the two big months, October, November. A year ago, starting on this date, this coming week, this week, I believe we went to 97, 95, like 87, 85, 75. I mean, those are the kind of numbers we saw total bean shipments. This year, we had 36 here this last week. I think 40,000,040 to 45,000,000 tops without China.
• 20:08
  So you're going to be talking about 30,000,000, 40,000,000, 50,000,000 bushel deficits each week. And we just got decided we got excited about a crush report that came in 11,000,000 bushels over expectations. So we have a problem. It needs to be fixed, or, we're in we're in for some rough times this summer if we don't see it or, excuse me, this winter, if we don't see a problem, with the crop in South America.
• 20:34
  Todd Gleason: Aaron Curtis, you agree? Rough times this winter?
• 20:38
  Aaron Curtis: Yeah. I think definitely along the river. I've obviously, we've seen some improvement in, basis levels from the processor side. John mentioned the NOPA crush numbers yesterday. You know, this year, expected the North and South Dakota to crush almost 40% of their bean production.
• 20:54
  So that's a little brighter spot than it was say in 2018 when it was mostly an export market, obviously not much business going off the PNW. So those beans are having to find alternative homes. But from here East, Illinois East, we've seen basis levels on beans slowly starting to continue to improve as the crusher reaches out for some more soybean supply. But I agree with John that that window, that these Jan window is really a limited opportunity right now for China to participate. We've seen a lot of beans obviously from Brazil, Argentina's export change filled in a lot of the gaps that China still had for November.
• 21:36
  So that window continues to shrink and Brazil's off to a halfway decent start on planting and they're going to have some beans at least harvested in January. Most of those are likely goes domestically, but we're talking limited window past last half Feb into March the way it looks today. So, I'm still optimistic that we get something done. Todd, it just doesn't sound like it's gonna be a large volume. The bright spot though, is if you look at soybean sales to other destinations outside of China, I think we're up 67%.
• 22:09
  So there have been other markets that we've been utilizing, obviously, it doesn't make up for China, but it does help soften the blow a little bit.
• 22:18
  Todd Gleason: Arlen, when the two presidents meet at the Asian Economic Conference, that is in Pacific Economic Conference that will take place, Will they have time to talk about soybeans at all or will they simply talk about rare earth minerals? And what does that really mean?
• 22:38
  Arlan Suderman: I do think that president Trump will stick the word soybeans in there somewhere so he can say he did. That we still haven't got confirmation from president Xi whether he'll be willing to talk to president Trump. But hopefully, there will be conversation because talking is always better than not talking. But the primary topic is going to be rare earth minerals and magnets. This is something that China has been building to toward for thirty years.
• 23:05
  We can track back the pattern of thirty years ago when they started the strategy and they started to, take over businessesses around the world that kind of, mind and or and processed to rare earth minerals and magnets and then move that to China. The mining and processing of this of these products is very expensive and it's environmentally dirty. And China, of course, has cheap labor and they can subsidize the industry that do the the processing. So they undercut companies around the world. And so most of the world, including us, we're happy to let them do it.
• 23:45
  China had the foresight to know that in the future global technology world that this would be the corner stone feeddstock for thehe high-tech elelectronic worldld that we've bebecome. And so they have monopotilized thatat market d down to 90%, but it's not j just about t the cell phones and the F one fifty trucks that arere dependent upon it. It's national defense. So when China took its made its move last Thursday, wrote to our clients that China had just changed the dynamics significantly. They they played.
• 24:20
  I'm gonna call it the trump card. Here that they've been preparing for thirty years. This is, I think, the one big card that they had to play. And this allows them to control and pick winners and losers economically in the world, which countries can grow their economy and which can't. But it also means which countries can grow their military and produce defense weapons and which cannot do so.
• 24:49
  So this is a matter of survival and national defense. They have stated they wanna topple The United States from being the number one military in the world and the number one economy in the world, and this is what allows him to do it. Why do this now? Because last week, President Trump invested in at least five minuteing and mineral companies in Greenland in The United States and applied the warp speed process that he used to get vaccines approved during COVID in months rather than years. And so the average time it takes a mining company to get approval for mining and processing where earth minerals, United States is twenty five years.
• 25:33
  There's only one country that takes longer. And so he's moving that from years to months to be able to get our own supply of rare earth minerals and magnets. And that meant that China had this narrow window in which they could play this card that they've been building toward for thirty years. And that's why they played it. But that is the number one thing.
• 25:55
  It's still gonna take us time to get to that point of having these products. But he's taken steps to move us forward in that process. And so that is the number one thing. And with all the military assets that we're giving Ukraine, We're using up assets that we can't replace without these rare earth minerals and magnets. And China knows that.
• 26:21
  It's one reason I think that G took a trip to Moscow earlier this year when Putin was looking for an off ramp out of the war. And since that meeting, the war escalated. And, so that's taking center stage above soybeans, and I think why it's gonna be more difficult to get an agreement on soybeans.
• 26:40
  Todd Gleason: How long do you think it will take to ramp up rare earth minerals produced within The United States GRAS? Is that a it it went from years to, you know, months maybe for just the the the ramp up, but you've got you've gotta be able to get in and mind them. Is that five years out? How how long before we really have something do you think or have you heard that might be usable?
• 27:11
  Arlan Suderman: Well, first of all, I expect some environmental challenges in the courts here to try to stop it and prevent it. I anticipate that. But whenever I've listened to the interviews of officials on well, how long will it take? They always kind of avoid the answering the question. So I'm not sure, although the president of one of the mining companies when asked said that we're going to break ground on a mine next week.
• 27:37
  So breaking ground on a mine doesn't mean that you're starting to pull product out of the ground in a week, but it does mean that we're probably months away, so to speak. How many months? You know, I anticipate it's probably gonna be more months than less. It's probably not gonna be next month by any means, but it will take some time. And it's a process that's needed to at least get started, but that still leaves us vulnerable, I would say, over the coming year.
• 28:05
  Todd Gleason: That puts us back to the fundamentals of just the marketplace where we are today. Trade's an issue. China has not bought. Not likely to buy, actually, I don't think, even into the to the New Year. If they can get to January and February, they will not buy.
• 28:22
  Apparently, they're gonna have to use their reserves because soybeans out of Brazil have a bit of a premium at this moment, so they'll pull out other reserves, certainly are willing to do that. That means we end up with the storage space at a use usage space usage item for, soybeans. How much of a drag is it on the marketplace? And I think I'll go through all of you, but let's start with John Zanker first on the answer to that question.
• 28:52
  John Zanker: Well, I think that, we can go back to the production issue here. Now if if, let's just say the USDA found a million less acres of corn and left a million more acres of beans and we'd have gotten two inches of rain, more inches of rain in general across certainly the Eastern Belt in August, we'd be sitting here talking, can we hold the nine fifty level? I don't think there's any doubt about that. We probably had a 56, maybe even a 57 bushel bean crop on August 1. So we're pulling yields down from that.
• 29:25
  We're not pulling yields down from the 53. So from the information I'm getting from around the belt and what I've seen with my own customers, I think we might hold 53,000,000 And if you can keep exports where they are, you're at $300,000,000 and you don't feel too bad about $10 holding up. But, we literally could take $300,000,000 at least out of this export number. So once we get confirmation of that, and we're going to have a big dump of export inspection data here maybe in November at some point, maybe late November, the later the worse it's going to be. And, so we just got to be very careful here.
• 30:11
  Any bounces in this bean market need to be looked at as a selling opportunity, certainly a hedging opportunity. And this could be a nightmare. And right now, for the first time in several years, we don't have any scares going on in South America in October. So planting is going along there. They're increasing the acres maybe up to 3.5% or so.
• 30:33
  CONEB just estimated their crop at 178,000,000 tons. So I believe that's another three thirty million bushels over this year. We a nightmare scenario going on if we don't get this thing straightened out. And even if we do get it straightened out, it's not going to save the ship, and we need to be very careful.
• 30:51
  Aaron Curtis: Yeah. So I think we're using another 150 ish million off of the export sales number. So it's called that 1.5 to 1.5 exports. So not a friendly sign, I think like I mentioned, I think we've got some other sources on the export side that are helping make up for China just a little bit, crush number could go up just a tick. And I still think yield probably comes down, maybe a half bushel an acre.
• 31:20
  So, still looking at three fifty to 400,000,000 bushel ending stocks, which not as friendly as what we would like, but probably continues to hold beans in this nine seventy five to ten fifty area. I know it's kind of a broad range, but that's really where we're stuck in, Both corn and soybeans sideways ranges, we wait for a headline, we trade that for a day or two, and then we go back to nothing, right? So, I think it continues, to stay that way. So, from a producer standpoint, if that upside is kind of too limited for you, I think you look at moving, continue to move some ownership on rallies and reown it with some kind of call option to kind of reduce your risk, depending on what these headlines may continue to say over the next few weeks.
• 32:10
  Arlan Suderman: China has about 10,000,000 metric tons of demand that they haven't supplied yet for December and January. They need to fill ahead of the next supply coming from Brazil. So if there is a deal, that's that's the possible possible purchases they could make three sixty seven million bushels roughly there. If you look at years, if you look at non China buying the highest that we've ever seen a non China buying was I believe in 1819 at about 1,270,000,000 bushels. This year I would certainly expect it to be higher than that of China doesn't buy anything.
• 32:47
  I would say the bottom number that I would look at would be 1,400,000,000.0. USDA is currently at 1.685. So that means that's around two eighty five million bushels below where USDA is at right now. I'm closer to the 1.5 or 1.55 right now, but that's working lower on a weekly basis. If in fact, they would get some type of deal, which I don't expect.
• 33:14
  But if they would get some a deal to get that 10,000,000 metric tons from us rather than from the reserves, then I think we could see exports go as high as 1.75 or so in there. And when you put that together with our domestic demand, what we expect out of the EPA once they finalize things, then I think that really does put some spark in the market and give some opportunity. I would hate to base a marketing plan on that expectation because I think there's more downside risk than upside. Depending on what happens with China. But I would certainly have a reownership plan in mind if we were to get something like that.
• 33:55
  Todd Gleason: I thought you meant 1819 as in two hundred years ago, and I was like, wait. That can't be right. Twenty eighteen, twenty nineteen. We'll get a final note from each of you in just a moment. I do wanna remind folks that they should visit our website at willag.org where they can sign up for the December farm assets conference and the Illinois farm economic summits.
• 34:14
  Both of those are sponsored by the PharmDoc team or the University of Illinois ag Economist. We thank you for coming to see us. Again, that's December 12 for the Farm Assets Conference, the fifteenth, sixteenth, and seventeenth for the Illinois Farm Economic Summits. John Zanker, let's start with you. What's your final word for the day?
• 34:33
  John Zanker: Well, from a marketing analyst, standpoint, we we can go back to June 30 and that acreage reported. And boy boy, you had to start thinking of making some adjustments at that point with the increase in corn acres and the decrease in bean acres. And then we got hit with another one in August and a little bit more of an adjustment in September. So, you know, it's kind of flipped things. It saved this bean market, taking the taking that amount of acres out, really saved the bean market, but it dampened that bullish perspective for corn.
• 35:07
  So we've had to ship some gears and then you throw in the rust. And it's going to be complicated, but I think we have to be realistic. We need to sell the rallies, use the rallies as hedging opportunities in soybeans especially, but also in corn. We can take this corn crop down quite a bit. A 10 bushel reduction in Iowa and Illinois each is two thirty million bushels, and we just picked up 195,000,000 on the Indian carryout.
• 35:39
  So it's not going to be easy, and we just need to be, on our toes and get ready to move on the first, good opportunities.
• 35:46
  Todd Gleason: John Zanker is with Risk Management Commodities. That's a division of Zaner Ag. Hedge Aaron Curtis is with us as well. Your final word from Midco, please.
• 35:54
  Aaron Curtis: I think corn's got a better base for it, at least on the demand side and future side than what beans do. Agree with John, though, I don't think we want to fall asleep on this crop moving forward. I think if we remembered last year, we did have a nice little bounce after harvest, but, basis and spreads obviously weakened up to when the farmer participated. So we got to keep in mind, we still got a lot of grain to buy from the farmer. So that's going to limit the upside a little bit that these corn in that 4.3 to 4.35 range would be the next target if we can get there to increase some sales, but definitely look for some re ownership opportunities through options in case this thing, you know, the trade headlines do start to lean more positive here over the next few weeks.
• 36:38
  Todd Gleason: And finally, Arlen Suderman with Stonax.
• 36:41
  Arlan Suderman: Yeah. We've been working with a satellite based company that's had a pretty good track record, and they're claiming that, harvested corn acreage is about 1,200,000 less than what USDA is saying. So we're gonna watch that closely. If that's true, that's another 200,000,000 bushels, basically off of the crop, not counting yield reductions that we anticipate we may see from this point. That's not necessarily that saying that we're gonna run out of corn, but it certainly removes much of the surplus.
• 37:11
  And we know that we've been trailing down world corn and supply stocks as a use over the last decade to continue to trend that level. So it does give us a little more hope for corn. Wheat's in a similar situation as well, and those two tend to feed off of each other. Perhaps the worst is behind us there in those markets.
• 37:31
  Todd Gleason: Commodity week, of course, is a production of Illinois Public Media. You may find and listen to the whole of the program anytime you'd like at willag.0rg. That's willag.org. Our thanks go to our panelists, including Arlen Suderman as well as John Zanker and Aaron Curtis on University of Illinois Extension's Todd Gleeson.