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Mar 18 | Closing Market Report · Closing Market Report

• 0:00
  Todd Gleason: From the Land Grant University in Urbana Champaign, Illinois, this is the closing market report. It is the March 2025. It's National Ag Day. I'm Illinois Extension's Todd Gleason. Coming up, we'll talk about the commodity markets with Naomi Bloem.
• 0:15
  She's at TotalTotalFarmMarketing.com. We'll hear from one of the winners of the National Ag Day Assay contest. She happens to hail from the great state of Illinois. And then as we wrap up our time together, we'll take up the agricultural energies with Dave Chatterton at Strategic Farm Marketing and hear about the weather forecast too. That's with Donde at Day Weather.
• 0:40
  All on this Tuesday edition of the closing market report from Illinois Public Media. Todd Gleason services are made available to WILL by University of Illinois Extension. There is a late breaking announcement for the day. The ARA or American Relief Act funding now called ECAP. The $10,000,000,000 approved by congress in the lame duck session will be released.
• 1:03
  Farmers should expect to see a prefilled out form in their mailboxes soon. Wednesday is the beginning of the sign up, but you can wait for the form. The payment for corn is $42.91 an acre. The payment for soybeans, $29.76, and wheat, $30.69. May corn in Chicago settled today down 2 and a quarter cents.
• 1:28
  It finished at $4.58 and 3 quarters. The July futures at $4.68, a settlement price down two, and December futures at $4.54 and a quarter, up a quarter of a cent. May beans, ten twelve and three quarters, down two and three quarters. July, '2 and '3 quarters lower, ten twenty six and a half, and November futures, $10.15 and a half a bushel, 3¢ lower. Bean meal futures off $4.40.
• 1:53
  The bean oil, 44¢ higher. Wheat futures in the soft red at $5.82 for the July harvest month, down 3¢. The hard red wheat at $6.19 in the July, a penny and a quarter higher. Live cattle futures in Chicago at $201 per hundred pounds, 7 and a half cents lower for the day. Feeder cattle at $2.85 25, a nickel lower, and lean hogs were down a dollar 77 and a half at $97.35.
• 2:21
  Crude oil, $66.73 a barrel, 64¢ lower. Diesel fuel, just about unchanged to $2.15 and 7 tenths of a cent per gallon, and gasoline at $2.17, just about a penny lower. Naomi Bloom now joins us. She's at TotalFarmMarketing.com out of West Bend, Wisconsin. Hi, Naomi.
• 2:39
  Thank you for being with us.
• 2:41
  Naomi Blohm: Yes. Thanks for having me.
• 2:42
  Todd Gleason: What'd see in the marketplace today?
• 2:44
  Naomi Blohm: Not much of anything. It was a very quiet day for the grain markets with two sided trade action. Not a lot for fresh news that came out on the overnight. We just continue to, I feel like, wait and watch for that March 31 quarterly stocks and planted acreage report. And until then, it just might be some quiet sideways trade in the days leading up to that report.
• 3:06
  Todd Gleason: And what are your expectations for the March 31 figures?
• 3:09
  Naomi Blohm: Well, I think we're gonna finally see a friendly corn number on the carryout side of things for old crop. The question of course will be, you know, how big is that increased acreage going to be for the December corn? And how that will affect the December corn price? The market is definitely thinking it's going to be, you know, 3,000,000 additional acres at least, but how high could they go is what the question will be. And then of course to see what they do with the soybean acre number, we're looking for about 3,000,000 less soybean acres from last year.
• 3:42
  And as soon as that report comes out, just a couple days after that, have to go into round three of trade war tariff news with Mexico and other countries. So plenty of things to be watching and mindful of. But that next big USDA report on March 31 is the piece of the puzzle that we are all waiting for next.
• 4:00
  Todd Gleason: So you're rolling the grain stocks figures forward into the April WASDE release. What is it on the demand side that you think you will see there? And what's pushing the usage along? Is it ethanol? Is it feed consumption?
• 4:15
  All of the above?
• 4:16
  Naomi Blohm: Well I think we're going to see an addition to ethanol demand, a slight addition, and to the export market for the old crop, just because our export sales and inspections have been running so much ahead of pace. I feel like we're going to continue to see that as supportive news then just in the coming USDA reports. And it's very similar to what had happened in 2020 going into 2021. And it was the quarterly stocks report that really started, the move higher for the markets. But again, a little bit different than 2021 from the standpoint of trade and tariffs being an issue, but the ending stock situation might be similar.
• 4:59
  1,500,000,000.0 bushel carryout, maybe looking to go lower just depending on what
• 5:04
  the USDA says in a couple weeks.
• 5:07
  Todd Gleason: So I'm wondering because this is the on farm off farm numbers for those grain stocks figures, and there was so much grain that was marketed in the month of January through parts of February. Will March 1 catch all
• 5:19
  of
• 5:20
  that and put it in the right places, or will there be some in transit that's lost along the way?
• 5:27
  Naomi Blohm: Well, is definitely something to be mindful of. So maybe we get a supportive number on the thirty first, and then when we actually get into the April WASDE, and then the May WASDE, see some additional information come to light, that would be supportive for the old crop.
• 5:44
  Todd Gleason: Okay. So what else are you watching at this time?
• 5:46
  Naomi Blohm: Keeping an eye on the global weather. It's been, of course, a little bit drier in Brazil, and now we're starting to hear of dry weather conditions in the Black Sea region. So that's very important to be monitoring in terms of how it'll affect, wheat production, in terms of how it'll affect second crop corn production in Brazil. And then, of course, it's been dry in our Midwest and there's some potential storms coming through this week, but how much precipitation actually falls is going to be monitored. And then switching gears over to the livestock sector, we do have a cattle on feed report coming up on Friday and we have live cattle and feeder cattle prices back up to the highest from earlier this winter.
• 6:26
  So we're going to need to see an over the top friendly report and some additional friendly cash news to see the market go higher than that. Otherwise, cattle futures and feeder cattle futures might be ready to see a little bit of profit taking action just depending on what that cattle on feed report says Friday afternoon.
• 6:45
  Todd Gleason: How should farmers think about the ad hoc dollars that they'll be getting in the mail soon? The numbers that we talked about already, from the ARA, the lame duck session, something like $30 for wheat, $43 for corn, about $30 for soybeans per acre. How should they take that into their marketing plans?
• 7:08
  Naomi Blohm: Well, I think that what it does is help bridge a gap between where the markets are at now and some sort of a potential late spring or summer rally where they can continue to sell old crop and do some forward contracting. It's not going to be a market replacer or a financial replacer to make people forget about marketing. You know, we're going into that season where a lot of times between Mother's Day and Father's Day is when we get our seasonal rally for corn and soybeans. And that's just when farmers are busiest in the fields. So it'll be again, it's a nice little bridge to gap any financial needs that could be out there for the short term, but it's not a replacement for marketing and stay on your toes.
• 7:52
  And just again, when you're busiest in the fields, there's a lot of times when we get some sort of a weather market to get this market pushing higher, and that's your opportunity to really focus on the cash sales.
• 8:02
  Todd Gleason: Thank you very much, Naomi.
• 8:03
  Naomi Blohm: Thank you.
• 8:04
  Todd Gleason: Naomi Bloom, of course, is with totalfarmmarketing.com. She is in West Bend, Wisconsin. It's National Ag Day, and the Agriculture Council of America has announced the twenty twenty five National Ag Day winners. They include Isabella Newell of Waltonville. That's near Mount Vernon, Illinois.
• 8:26
  The theme for this year's competition was why food security equals national security. I pulled the audio from Isabella's video for you to hear.
• 8:37
  Isabella Newell: Food security equals national security because having sufficient food supply keeps society in check. Alfred Henry Lewis observed in nineteen o six, there are only nine meals between humankind and anarchy. Scarcity of food can lead to an uncivilized society, which can lead to a threat to national security. Food security is paramount to a successful functioning nation or society. Food is a resource shared across the nation, and any issue or bacteria that is in the food will affect all citizens in the country.
• 9:06
  Not only does food need to be safe, but it should also be available to everyone in the nation. Safe and available food is necessary for citizens to function. When citizens are healthy and able to function, they will be able to support the country, defend the country, and help the country thrive. Food security is the ability of a nation to feed its people. A nation that cannot provide for its people is not a secure nation.
• 9:29
  The inability of agriculture to provide enough food for its people opens the door to many security threats. Without food security, The US would go dependent on external products. Without agriculture, the US cannot and would not be what it is today.
• 9:43
  Todd Gleason: If you'd like to watch Isabella Newell's winning entry into the National Ag Day video essay contest, you may do so at agday.org. That's ag day, all one word, .0rg. Hers will be one of the three winning entries to be shown, by the way, at the USDA Building in Washington DC during today's National Ag Day celebration. Hey congratulations to Isabella. The Ag Day essay contest is sponsored by CHS, the National Association of Farm Broadcasting, Farm Progress, and Successful Farming.
• 10:20
  In its fifty second year, National Ag Day encourages every American to understand how food and fiber products are produced, appreciate the role agriculture plays in providing safe, abundant, and affordable products, value the essential role of agriculture in maintaining a strong economy and acknowledge and consider career opportunities in agriculture, food, and fiber industries. Certainly, we here on the University of Illinois campus with Illinois Extension and the College of Agricultural Consumer and Environmental Sciences echo those lifelong learning goals. We do each Tuesday, let's turn attention now to the agricultural energies. Dave Chatterton is here. He's from Strategic Farm Marketing in Champaign, Illinois.
• 11:09
  Hi, Dave. Thank you, for being with us. I just think there's an awful lot that we need to pay attention to within the energy sector. What have you been watching most closely in the last month or so?
• 11:21
  Dave Chatterton: Yeah, Todd. It's been kind of a tough month here. When you look at those highs that came into the marketplace, whether it's crude or diesel fuel back in, you know, you know, early January or even the highs that we had in mid February, we're, from a crude perspective, we're about $20 below the the level that we got to in terms of where the crude high was in mid Feb, and we've lost about $30 over the last eighteen months. And, of course, diesel fuel is in the kind of in that same boat, if you will. Now we've rebounded a little bit here.
• 11:47
  We're on our third day in a row higher on on the market. So that's Friday, Monday, and Tuesday, but still on kinda shaky footing. And this is a bigger, I think, argument here about, you know, increased or or growing global supply against what is a little bit of a shaky view of the global economy right now, particularly for places like China and in Europe and some other areas that are experiencing a little bit of the, you know, the drawdown. So we're we're trying to balance that out. We've seen a number of the major, you know, Wall Street banks, analysts, brokerages go ahead and, revise down their price targets here in the last ten days.
• 12:22
  So the likes of, you know, Goldman, Morgan Stanley, Citigroup, JPMorgan, Bank of America, Vitol, Governor. So all, you know, kind of beating the same drum here and talking about the supply somewhat overwhelming, demand. On the other side of that, of course, we have the geopolitical. What if, you know, Trump sanctioning Iran or something happening in the Mideast and, you know, to to deal with. But but it's been a heavy market here of late.
• 12:48
  A little bit of recovery here lately, but it still feels like we're we're we're maybe exploring the downside a little bit more.
• 12:53
  Todd Gleason: So what is it about the supply and demand tables that are out of sync at this point? Is it the demand or projected demand is lower? Is that the supply continues to come in too fast? A combination of the two?
• 13:09
  Dave Chatterton: It's a combination of the two. The global growth metrics here, whether, you know, depending on whose numbers you use, we're still growing and fuel demand is still projected to grow, but it's projected to grow at a slower rate, partially due to, you know, somewhat, you know, poor economic performance on a macro level, and somewhat due to just general demographics, while supply is continuing to go up. If you look at US supply, we're still setting records in terms of our crude oil and and and production. You look at what's happening with OPEC plus, they've agreed to now start bringing back the production that they've held off the market for the better part of three years. And we're supposed to do that on a monthly basis through September of twenty six.
• 13:48
  And at the end of that process, that equals about a little over 2,000,000 additional barrels per day coming onto the marketplace. And, you know, then we've got the Trump in the background with, don't know, the drill baby drill mantra, I guess we'll call it, Todd. And certainly, he has made clear, from the campaign to the inauguration day through, you know, this part of his presidency that he is in favor of lowering energy prices. And he's gotten that wish to a degree, so far. He's gotten, you know, OPEC to sign on to that.
• 14:18
  We're having a meeting between Putin and Trump, you know, this week that, you know, who knows what happens, but there's some time that the sanctions may be lifted or lightened against Russia, bringing more oil onto the marketplace. So that that supply side is really what's won the battle here in terms of price direction of late.
• 14:36
  Todd Gleason: So if it is the supply side, what impact does it have on ethanol and from corn? And also, you could try to think through what the impact might be of Canada having to tariffing ethanol coming across the border into that nation from The United States. It is the number one export destination, if I remember correctly, for ethanol. And how does that work into the grind? I don't know that I'm worried so much about pricing, but what total grind looks like in projection.
• 15:15
  And I suppose USDA uses that in the supply and demand tables.
• 15:18
  Dave Chatterton: Yeah. They certainly do. We get weekly reports from the EIA every week about, you know, ethanol, you know, usage or ethanol production and in terms of, you know, what it means to corn usage and etcetera. So you're exactly right. Canada is our number one importer of ethanol and not by a little bit, by leaps and bounds and, you know, they import somewhere on the order of 30 to 40% of of all US ethanol that gets exported.
• 15:39
  So that, you know, turf war, tariff war, you know, trade spot, term you want to apply is certainly affecting that. Now it's been a little bit of a positive here in the near term as we were seeing some of those exports maybe get front loaded ahead of these supposed April tariff deadlines. But in the bigger picture, it's probably a negative. Todd, I think maybe the easiest way to kind of frame that up is if we look at the EIA data from last week, and I'm going from memory here, but I think ethanol stocks have started to balloon a little bit. We're about six to 6.2% above where we were at the same point last year.
• 16:12
  Production of ethanol in The US is up year to date about 3.7%, and blender demand is down about half a percent. So that tells you that exports have been filling that void. And as that slows down, those stocks have increased. We're actually sitting at record stocks for the Midwest here. Plant margins have hung in there.
• 16:29
  We're in that, you know, maybe 5 to maybe 10¢ a gallon, you know, net type of a a positive margin, but they're not there by a lot. And we've seen ethanol start to recover a little bit of value along with the oil market, but still, you know, relatively speaking, we, you know, we're we're we're not in rich territory here. So I think there's some concern. We're looking at the downtime, you know, plant shutdown and maintenance period here coming up that typically leads into the summer driving season, but The US is just not burning a lot more gasoline than or blending a lot more gasoline than what we have been over the last several years. So very dependent on that ethanol or excuse me, that export market.
• 17:06
  Todd Gleason: And finally, do you have a sense of whether producers and use end users should be taking advantage of current lower prices or not, or should they be waiting?
• 17:18
  Dave Chatterton: Yeah. I think you can be a little bit patient here, Todd. It's certainly not a bad idea if you don't have any, you know, contracts, nothing in your tank, whatever. You're sitting empty or going into spring planning here and you don't have any bot. You know, like I said, we've been on a a pretty good drop here.
• 17:30
  And so, you know, you look at diesel fuel at recent lows in terms of board prices or NYMEX prices were around $2.15. We're about $2.20 here today. So certainly with side of those recent lows, the the more relevant lows going back to last fall are more in that $2.10 area. So given the the scope and and size of the the decline that we've talked about here earlier in this in the program, I think the way you wanna view it is, you know, is there room for additional downside here? Yeah.
• 17:55
  I mean, can that be 5 to $10 in crude or maybe, you know, 15 to 25¢ in in diesel fuel? Sure. But I I think the risk is increasingly becoming skewed to the upside here just in terms of risk reward when you do it and how far we've fallen and kind of now everybody throwing in the towel and saying we're gonna get lower prices. It's often a signal that, you know, we're starting to form a little bit of a bottom here and, you know, so I think you can be patient, but I I I wouldn't fall asleep at the wheel here in just a little bit. Think, know, we're looking to pick up, you know, nickels here, not necessarily, you know, dimes and quarters.
• 18:27
  Todd Gleason: Thank you much. I appreciate it.
• 18:29
  Dave Chatterton: Thank you, Todd.
• 18:30
  Todd Gleason: Dave Chatterton is with Strategic Farm Marketing joins us once a month here on Illinois Public Media's closing market report to discuss energies. Our theme music is written, performed, produced by Logan County, Illinois Farmer Tim Gleason. Let's check now on what's been happening in the growing regions across the planet with the climate and the weather. Don Day is here. He's at Day Weather in Cheyenne, Wyoming.
• 19:08
  Hi, Don. Thank you for being with us again.
• 19:10
  Don Day: Thanks for having me.
• 19:11
  Todd Gleason: Let's start in South America. We are either in the beginning of the safrinha crop for Mato Grosso and parts of Brazil or at the very end of harvest for the soybean crop. Either way, I think they've had dry conditions, and they caught up to where they were. What do you see for the rest of this week and going forward?
• 19:34
  Don Day: Yeah. I mean, there certainly has been a persistent dryness in some areas, especially in some of those southern areas of Brazil. Now the prospects for precipitation over the next couple of weeks has gotten better. Just a few days ago, it was looking a little bit drier, but now things are changing a bit down there. As their seasons change like ours, things get a little bit more variable.
• 19:56
  But it does look like the areas you just mentioned are likely going to be looking at some decent chances right here over the next seven days. And I think that may stretch out to two to two weeks.
• 20:07
  Todd Gleason: And do you look further into the month of April then and, you know, eventually, we do shut off, the rainy season and dry season arrives. Are you worried about that at all?
• 20:18
  Don Day: Well, I I do think that is a concern. You know, the the as you mentioned, this is the time of year, that April into May when things start to quiet down down there. So I think they gotta make hay here over the next couple of weeks. I think they'll do that. I am still concerned about some of the southern and Southeastern states, of Brazil maybe missing out on some of this rain here over the next couple of weeks.
• 20:41
  So there will be some dry pockets even with the rain here over the next week or two.
• 20:44
  Todd Gleason: In The United States, start with the hard red winter wheat growing regions and then work your way across the Midwest and maybe talk about that series of storms, severe weather that we have had and what your expectations might be coming through the end of the month.
• 21:00
  Don Day: Well, for those hard red, red, wheat areas, it's gonna be kind of feast or famine in terms of where the precipitation is going to be. There's a storm track that is set up here in the month of March. It's gone straight from, oh, Central Northern California right across the Central Rockies and into the Plain States and so north and south of that storm track, precipitation spotty. While in the heart of that storm track, these storms have, been producing some winter weather. We're gonna see winter storm conditions from Northwest Kansas through Central And Eastern Nebraska through Northwest Iowa, Southern Minnesota, Wisconsin.
• 21:38
  They've got blizzard warnings and winter storm watches in effect along that path. And then the precipitation is gonna be spreading into the Corn Belt and Midwest out ahead of that low and that does include more severe weather. Not the outbreak that we had last week and over the weekend thankfully, but still nonetheless. Parts of the Eastern Corn Belt, parts of the Southern Great Lakes will have severe weather.
• 22:02
  Todd Gleason: So this was in I think this is storm track number three of this series. How many do you think there will be in total?
• 22:09
  Don Day: Well, there's there's been about two a week since March started and I think that general trend will continue with other little waves coming in behind us through the weekend and into early next week. Now after that, towards, let's say about a week from today there's going be a large area of high pressure that's going to move into the Central United States. It's going to bring a little bit of spring, a little bit of a warming trend and a drying trend as well. Although I don't think it will last very long before the storminess starts up again. But I do see a pause in the action for a few days next week over a lot of The US.
• 22:45
  Todd Gleason: Hey. Thank you much. We'll talk with you again next week.
• 22:48
  Don Day: See you then.
• 22:49
  Todd Gleason: Donde is with Day Weather. He is in Cheyenne, Wyoming. Joined us on this Tuesday edition of the closing market report. It came to you from Illinois Public Media. It is public radio for the farming world online on demand at willag.org, or search us out in your favorite podcast applications.
• 23:06
  I'm Illinois Extension's Todd Gleason.