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Crop Markets and Politics: Wrapping Up May · AG Bull

• 0:14
  Speaker 1: well, happy friday everyone.
• 0:21
  Speaker 1: Tom grisafi with ag bull trading.
• 0:23
  Speaker 1: I'm an ap over here at nesvic trading group, based out of memphis and nashville.
• 0:28
  Speaker 1: Today we're going to talk in the month.
• 0:30
  Speaker 1: The month of may, as far as it comes to trading, is over and we have the one and only Mr Don Wick from the Red River Farm Network.
• 0:37
  Speaker 1: Don, welcome to the show.
• 0:38
  Speaker 1: I feel like it's been a few weeks since we've done one of these, but Don was in DC and I got a feeling we're going to talk a lot of politics.
• 0:46
  Speaker 1: We may say the name President Trump once or twice.
• 0:49
  Speaker 1: How are you, my friend?
• 0:59
  Speaker 2: I once or twice.
• 1:00
  Speaker 2: How are you, my friend?
• 1:00
  Speaker 2: I'm doing fantastic, a beautiful day, although here in beautiful Grand Forks, north Dakota, we've got hazy skies.
• 1:02
  Speaker 2: The fires in Canada are clouding up all the skies in the Dakotas and northern Minnesota right now.
• 1:05
  Speaker 1: Not only do I not like Canadian politics, I don't like Canadian fires.
• 1:08
  Speaker 1: A few years ago in Valparaiso, Indiana, I was literally having a hard time getting up in the morning and going walking.
• 1:15
  Speaker 1: A few times I got sick.
• 1:17
  Speaker 1: You look at your phone and you see that air quality.
• 1:20
  Speaker 1: And silly me.
• 1:22
  Speaker 1: I was walking in horrible air quality and didn't realize what that was like and that's a problem.
• 1:29
  Speaker 1: Yeah, it's going to be all over.
• 1:31
  Speaker 2: Yeah, so far.
• 1:32
  Speaker 2: It just started really yesterday in our region and it's been pretty much aloft, so it really hasn't impacted our air quality.
• 1:38
  Speaker 2: But what should be a beautiful blue sky is just one big haze right now.
• 1:44
  Speaker 1: Well, we've got blue skies.
• 1:45
  Speaker 1: Down here in Nashville, we have the rodeo in town tonight, we have rodeo at Bridgestone Arena and then jelly roll.
• 1:51
  Speaker 1: Speaking of jelly roll, that's nothing that you or I need to be jelly rolls, but we got a lot of market action.
• 1:59
  Speaker 1: You were in DC, don in DC.
• 2:00
  Speaker 1: Want to talk politics first, and then we'll wrap up how the markets closed for May.
• 2:04
  Speaker 2: Yeah, we certainly can.
• 2:05
  Speaker 2: Certainly no shortage of news happening on the front of DC the Trump tariffs, or, uh, what's been happening with that big beautiful bill, uh, the budget reconciliation process.
• 2:18
  Speaker 2: So, uh, where do you want to go, tommy?
• 2:21
  Speaker 1: Well, I want my brother to go full screen on you.
• 2:23
  Speaker 1: Apparently he forgot how to do this.
• 2:25
  Speaker 1: We will start with the big beautiful bill for $100.
• 2:29
  Speaker 2: All right, the big, beautiful bill, the budget reconciliation process, made it through the US House by one vote.
• 2:37
  Speaker 2: So it was a very tough poll.
• 2:40
  Speaker 2: They had to do a lot of work to really bring the conservative Freedom Caucus members, some of the budget hawks, over to get that job done, because it does actually add to the budget deficit and that was a no-no for the more conservative members of the Republican caucus.
• 2:59
  Speaker 2: So Trump had to meet with them a couple of times and came up on Capitol Hill and met with the Republican caucus, but they got the job done.
• 3:06
  Speaker 2: It passed by one vote just ahead of their Memorial Day break and now it's going to move over to the Senate and the Senate probably will take till August or even early September I guess August because it'll be on break in September.
• 3:20
  Speaker 2: But I wouldn't expect any quick action on the budget reconciliation process in the Senate.
• 3:26
  Speaker 2: They're a much more deliberate chamber and they're going to take some time.
• 3:30
  Speaker 2: In fact they're talking of breaking it up into a couple different pieces instead of doing it as the one big bill that they have.
• 3:37
  Speaker 2: Tommy for agriculture, it's got the money areas that we talk about, so it bumps reference prices.
• 3:44
  Speaker 2: It makes some changes in the crop insurance program.
• 3:47
  Speaker 2: It does some things like with dairy margin coverage and some of those type of efforts.
• 3:52
  Speaker 2: It also doubles the amount of funding available for trade promotion the market promotion programs that USDA has.
• 4:01
  Speaker 2: So those areas for agriculture came through.
• 4:05
  Speaker 2: The more policy elements of the Farm Bill things that you want to get done.
• 4:11
  Speaker 2: Say that Proposition 12 thing in California.
• 4:14
  Speaker 2: They want to make a correction of that through the farm bill process.
• 4:18
  Speaker 2: That didn't happen in budget reconciliation.
• 4:20
  Speaker 2: So still a lot of work.
• 4:23
  Speaker 2: The big hit that came out of this was about a $300 whack out of the stamp benefits the Democrats, of course, opposed to that.
• 4:33
  Speaker 2: The SNAP benefits the Democrats, of course, opposed to that.
• 4:37
  Speaker 2: But that was the one thing that the Republicans were focused on to help pay for the budget cuts.
• 4:40
  Speaker 2: Keep in mind, the biggest thing out of this is a reauthorization of those 2017 tax cuts, and so that's one big reason that a lot of work, a lot of focus, has been on this legislation.
• 4:53
  Speaker 2: Tommy.
• 4:54
  Speaker 1: Don educate the good folks here at AgBull Media.
• 4:56
  Speaker 1: Agbull Trading.
• 4:57
  Speaker 1: How long has it been since we've had a new farm bill?
• 5:01
  Speaker 2: 2018, since we had a farm bill and really, actually, if you think about it, 2018 was pretty much a rubber stamp of what we did in 2013.
• 5:08
  Speaker 2: So we really haven't changed the farm bill extensively since dating back to 2013.
• 5:15
  Speaker 2: We should have passed a farm bill a couple of years ago.
• 5:18
  Speaker 2: We've had two extensions.
• 5:19
  Speaker 2: They tried to get something done the last days in December but they couldn't push it across the finish line, so now they've broken it up into two pieces.
• 5:31
  Speaker 2: It's pretty unusual because we've always had that farm bill coalition where the folks that care about the nutrition title what happens on that part of the farm bill and then the traditional ag interests that care about price supports and crop insurance, those kinds of things.
• 5:49
  Speaker 2: They have worked together to pass that legislation.
• 5:53
  Speaker 2: This kind of breaks that up because we're handling the ag dollar issues, the mandatory spending issues for agriculture in budget reconciliation and took a big cut out of the food stamp program and they're really kind of changing the way the food stamp program is being done to put more focus on the states.
• 6:14
  Speaker 2: They're going to have to spend more money coming out of the state coffers for the food stamp program, so that's another change that came through in this legislation.
• 6:26
  Speaker 2: Again, nothing done.
• 6:28
  Speaker 2: At this point it still has to go through the Senate and it still could be many, many months before that's done.
• 6:33
  Speaker 1: Sounds good.
• 6:34
  Speaker 1: I was writing my notes while you're talking, Don.
• 6:36
  Speaker 1: We're looking at $4.40, $4.50 December corn futures.
• 6:40
  Speaker 1: We're looking at $4 cash corn, maybe even cash corn with the three in parts of the country.
• 6:45
  Speaker 1: What are you hearing on money for farmers?
• 6:47
  Speaker 1: I know they let the price sink, then issue the money later.
• 6:50
  Speaker 1: It would help us do a better job marketing if we knew money was on the way.
• 6:54
  Speaker 2: new money was on the way.
• 6:55
  Speaker 2: Well, I would say actually this week for our livestock producers.
• 6:59
  Speaker 2: You may recall, the livestock producers here in the Dakotas have dealt with wildfires.
• 7:04
  Speaker 2: A year or two ago the USDA came out with a $1 billion infusion farm assistance for those ranchers, those livestock producers, and if they went and filed all the paperwork that they did at that time, they don't have to come and do anything again.
• 7:23
  Speaker 2: It's just the Farm Service Agency is going to take care of it.
• 7:26
  Speaker 2: They should be getting a check coming their way.
• 7:28
  Speaker 2: In fact they're in that process right now.
• 7:31
  Speaker 2: It got authorized, I believe yesterday, and they should be in the process of sending out those funds here this week or early next week, the way it sounded to me from the paperwork we got from USDA.
• 7:45
  Speaker 2: There still is, I think, some other disaster programs that are out there that we're waiting for those dollars to come through.
• 7:55
  Speaker 2: But that's all to come, I guess, tommy.
• 8:00
  Speaker 1: Well, as they say in the movie Jerry Maguire, show me the money, right.
• 8:03
  Speaker 1: I would love to hear that anyone who grows bushel corn is getting 50 cents.
• 8:07
  Speaker 1: We could actually make some cash sales Anything else out at DC or anything else political.
• 8:14
  Speaker 2: Just with the tariffs, we had a court yesterday I should say Wednesday morning, I should say Wednesday evening that said the Trump tariffs, the reciprocal tariffs that were put in place in April, and then they did that 90-day pause was illegal.
• 8:31
  Speaker 2: They had to pull that back.
• 8:34
  Speaker 2: There was another court that weighed in on that actually then yesterday, of course, the White House appealed that right away and that appeal took.
• 8:43
  Speaker 2: So the tariff situation does continue, but this is a very fluid situation on what happens with the tariffs and some of the trade deals that are being worked on right now by the Trump administration, Don, I can only smile and think of an Italian movie Ligano.
• 9:02
  Speaker 1: No Ligano, illegal, not illegal.
• 9:05
  Speaker 1: We're talking about the United States government kind of for lack of a better word, shit show right, but I know in the radio broadcast you don't speak such a foul language, but here on the trading floor every once in a while we've got to call it like it is.
• 9:20
  Speaker 2: Italiano.
• 9:21
  Speaker 2: The Ag Secretary is actually going to be in Italy on Monday and Tuesday trying to talk trade with the Europeans and see if they can come together on that, so that'll be interesting too.
• 9:31
  Speaker 1: Yeah, good stuff.
• 9:33
  Speaker 1: Let's move to markets.
• 9:33
  Speaker 1: The month of May is over from a trading perspective and I do have the closing wrap down for the month of May.
• 9:40
  Speaker 1: July corn down 31.
• 9:41
  Speaker 1: July wheat up three.
• 9:43
  Speaker 1: July soy down three.
• 9:44
  Speaker 1: Big loser of the month of May will be corn.
• 9:47
  Speaker 1: We grow over 15 billion bushels of corn.
• 9:50
  Speaker 1: You take away 30 cents from that.
• 9:52
  Speaker 1: That's going to hurt.
• 9:53
  Speaker 1: Now, of course that's in the July.
• 9:54
  Speaker 1: December would have a different net change.
• 9:57
  Speaker 1: Looking at cattle a lot of optimism.
• 9:58
  Speaker 1: Take what Don said about money to some ranchers up north.
• 10:02
  Speaker 1: But live cattle up $7 on the month.
• 10:05
  Speaker 1: Hogs up three.
• 10:05
  Speaker 1: Feeder cattle up four.
• 10:07
  Speaker 1: Feels like they're up more.
• 10:08
  Speaker 1: But they have been trending up for a long time With that.
• 10:11
  Speaker 1: We've had some down days, limit down days.
• 10:14
  Speaker 1: Of course we had all the drama this week from the fake news, right?
• 10:19
  Speaker 1: Not that don wick of the red river farm network would uh, ever uh, do that.
• 10:23
  Speaker 1: Let me ask you something, and I'm being serious how many times in your career have you put out a story where you had to totally retract it and go?
• 10:30
  Speaker 1: That's?
• 10:31
  Speaker 1: I'm sorry, I messed that up a few times.
• 10:33
  Speaker 1: I mean, that's a big one, isn't it?
• 10:35
  Speaker 1: Say there's a worm.
• 10:36
  Speaker 2: Take feeder cattle limit down you know we would be on the air saying that there are reports of that happening.
• 10:44
  Speaker 2: We went.
• 10:44
  Speaker 2: It wouldn't be confirmed by what we would be saying at that point.
• 10:47
  Speaker 2: I don't think.
• 10:48
  Speaker 2: Um, yeah, there's, our integrity is pretty important to us, so I can't think of too many.
• 10:56
  Speaker 2: I see you're choosing every word like it has a $100 bill attached to it.
• 10:59
  Speaker 2: Exactly.
• 11:00
  Speaker 1: I'm just from my perspective and the good folks here we have a lot of cattle traders and cattle people involved in Nesvik trading really active in cattle futures and options.
• 11:12
  Speaker 2: Investor asking the commodity futures trading commission to investigate that rumor of what happened on.
• 11:20
  Speaker 2: What was it?
• 11:21
  Speaker 2: Wednesday?
• 11:21
  Speaker 2: Because of the market impact and the dramatic impact it had on prices.
• 11:28
  Speaker 2: So we'll see if that has any traction.
• 11:29
  Speaker 2: Who were those officials?
• 11:30
  Speaker 2: Who's that Major cattle organization in the cattle business?
• 11:34
  Speaker 2: There seems to be a number of them.
• 11:35
  Speaker 2: We have National Cattlemen's Beef Association, RCAF USA, US Cattlemen's Association.
• 11:41
  Speaker 2: You all have a little different angle on this thing so many acronyms FBI, cia, irs.
• 11:48
  Speaker 1: It's got the cow guy says we're going into the three-letter acronym word.
• 11:51
  Speaker 1: Okay with that.
• 11:52
  Speaker 1: That's the market's overall tone.
• 11:55
  Speaker 1: One of the interests here is that you bring the Northern Plains perspective.
• 12:03
  Speaker 1: Canada, north Dakota, minnesota, south Dakota, maybe even a little bit of Montana Very much people understand.
• 12:09
  Speaker 1: If you live in Illinois you probably have a great idea how Illinois crops are going.
• 12:12
  Speaker 1: We consider you not only the expert on a national level in politics but definitely the voice of the Red River.
• 12:20
  Speaker 1: How is the attitude of farmers up in the Red River Don?
• 12:24
  Speaker 2: It's just been a bit of a strange spring, early summer season, when you think about it.
• 12:28
  Speaker 2: We had 90 degree temperatures one week and wind it was just crazy wind, so that if you wanted to get some spraying done you couldn't, just because of mother nature.
• 12:39
  Speaker 2: And we went the following week right down to close to freezing temperatures very cold, uh, and now we're warming back up again.
• 12:47
  Speaker 2: These guys are are back into the field, uh, basically crops are in, other than a few stragglers with soybeans and moving on into the canola and dry edible beans and those kind of things, but most of the crops are in.
• 13:04
  Speaker 1: Very good With that.
• 13:06
  Speaker 1: Sugar beet farmers, I know always looking to be optimistic.
• 13:11
  Speaker 1: We need tons in sugar, we need bushels, we need wheat.
• 13:15
  Speaker 1: But we went up 10-12 yesterday, we went up 10 today, but we need a lot of days of that.
• 13:32
  Speaker 1: Don just to get spring wheat above $6.
• 13:36
  Speaker 1: And, believe it or not, there will be a harvest here in a few months, correct?
• 13:40
  Speaker 1: Yeah, it will.
• 13:43
  Speaker 2: It's also going to be interesting just to see how this crop, but because we were not able to get a pre down for most of our farmers in this region because of that weather, whether it was the wind or what was going on then with the cold and the rain.
• 13:56
  Speaker 2: So trying to attack some of these weeds and maybe a few extra disease issues because of the cold and wet conditions could be an interesting start to this season.
• 14:07
  Speaker 1: Brag yourself up, Don.
• 14:08
  Speaker 1: I know you put out a wonderful newsletter on Mondays.
• 14:10
  Speaker 1: Joe popped that up.
• 14:11
  Speaker 1: How do people get ahold of Mr Don Wick?
• 14:14
  Speaker 2: You can sign up for our newsletter, farmnet News.
• 14:16
  Speaker 2: It goes out every Monday.
• 14:18
  Speaker 2: It is a snapshot of what goes on in the world of agriculture.
• 14:21
  Speaker 2: Just go to our website, rrfncom.
• 14:24
  Speaker 2: As in Red River Farm Network.
• 14:28
  Speaker 1: Excellent.
• 14:28
  Speaker 1: All right, this has been the end of month wrap up, but you and I we're going to start doing these every week, probably record, most likely on Thursday or Friday, if we're in a pinch.
• 14:38
  Speaker 1: Maybe go Saturday might alternate.
• 14:41
  Speaker 1: Some of your other wonderful people who work there at the Red River Farm Network Got an excellent team there covering politics, everything happening in the valley.
• 14:50
  Speaker 1: Optimistic points for the month of May would be cattle Things.
• 14:53
  Speaker 1: I'm sad about the price of corn.
• 14:55
  Speaker 1: There's some things you can control, some things you can't.
• 14:57
  Speaker 1: If you're looking for a weather story and we get hot and dry, that means there's going to be less bushels.
• 15:01
  Speaker 1: So if the market shoots up based on a weather problem, it means that someone out there has less bushels.
• 15:06
  Speaker 1: Of course we always want someone in South America to have less bushels so the American farmer can benefit.
• 15:12
  Speaker 1: But last but not least, mr Don Wick, anything on land prices or the price of shares of sugar stock in North Dakota.
• 15:22
  Speaker 2: You know, kind of at the end of that season, you know, once guys get rolling the tractor, certainly the shares that wrapped up in early April.
• 15:31
  Speaker 2: But as far as farmland, traditionally we don't see a lot happening at this point in the season because they're busy in the ground.
• 15:39
  Speaker 2: But those land values have been pretty sticky.
• 15:44
  Speaker 2: They've held firm.
• 15:46
  Speaker 1: We haven't really seen any pushback along with the drop in commodity prices well, we're also seeing as these uh suburbs of fargo and grand forks grow.
• 15:56
  Speaker 1: Where you live in, uh, south grand forks used to be way out there and now that's just.
• 16:02
  Speaker 1: They're just every year taking a few more sections, making big, beautiful houses, and North Dakota is a very desirable place to live correct, beautiful.
• 16:11
  Speaker 2: We love it here.
• 16:12
  Speaker 1: Except for in the winter.
• 16:14
  Speaker 1: You lie, you lie.
• 16:16
  Speaker 1: It is.
• 16:17
  Speaker 1: What's beautiful is the people Now, the weather in the winter.
• 16:20
  Speaker 1: That's why we go to UND hockey games or something else, but we stay busy nonetheless.
• 16:26
  Speaker 1: All right, let's do this again next week.
• 16:27
  Speaker 1: Mr Don Wick, redbird Farm Network.
• 16:28
  Speaker 1: Tom Grisafi, I am an associate person in Nesvik Trading and we do business as Ag Bull Trading and this will be broadcast on the Ag Bull media platforms.
• 16:37
  Speaker 1: Down below we put all our socials.
• 16:39
  Speaker 1: We'd love if you click, like and subscribe.
• 16:41
  Speaker 1: We got YouTube, we got X, we got Facebook.
• 16:44
  Speaker 1: Occasionally we'll be going live and we'll be doing more educational series like this.
• 16:49
  Speaker 1: Everyone, have a great weekend.
• 16:50
  Speaker 1: Next time you see us it'll be the month of June.
• 16:53
  Speaker 1: Have a good day, have a good night you.