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Nov 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 reported as the November 2025. I'm extension's Todd Gleason. Coming up, we'll talk about the commodity markets with Naomi Bloem. She's at totalfarmmarketing.com.
• 0:15
  We'll hear an interesting story about grain trade across the planet and state owned trading firms, and then we'll take a look at the agricultural energies. We'll do that with Dave Chatterton with strategic farm marketing. And as we close out our time together, we'll also take a look at the weather forecast. We'll hear from Dundane. He's a day weather in Cheyenne, Wyoming all on this Tuesday edition of the closing market report from Illinois Public Media.
• 0:44
  It is public radio for the farming world online on demand at willag.0rg. Our theme music is written, performed, produced, and courtesy of Logan County, Illinois farmer, Tim Gleason. Todd Gleason's services are made available to WILL by University of Illinois Extension. No update at the numbers from the CME Group in Chicago as I'm hosting events at the iHotel today and tomorrow for University of Illinois Extension, and then I'll be headed to the National Association of Farm Broadcasting Convention in Kansas City where Naomi Bloom already is. She's with Total Farm Marketing.
• 1:22
  And on tomorrow morning, we'll be doing a commodity panel for the rest of the farm broadcasters around the nation. Hey, bet you're excited about that, and I bet you're really looking forward to it.
• 1:34
  Naomi Blohm: Yeah. It's gonna be a a great crowd and a good opportunity to bring forth all of the updated USDA WASI report information from Friday, and and the daily export sales that have been coming out, and just try to piece together the puzzle for grain supply and demand, and what it might mean for the markets going forward.
• 1:55
  Todd Gleason: And then you'll do the same thing for me again on Thursday morning, you and Jim McCormick, along with Arlen Suderman will be there to talk about, these marketplaces for our commodity week program. I'm looking forward to that too. By then, we probably will talk less about what happened on Friday of last week. But why don't we go through some of those numbers so I since I know you're prepped for them, what did they, mean to you as they were released?
• 2:24
  Naomi Blohm: Well, you know, what was interesting was that the report was actually more of a traditional November report wasn't a lot of tweaking or changes or adjustments. Usually the November report, I like to call, usually get done and we don't get a lot of fresh news, that's actually what Friday delivered. The surprise was that the corn yield didn't come down as much as traders were hoping. We've got that corn yield number at one eighty six and USDA for old crop carryout increased it, and therefore that was a larger carry in, so it helped to offset some of the lower yield. And not too many changes to demand, but now we have exports for corn over 3,000,000,000 bushels, which is just tremendous and we actually, if the export inspections keep up the way that they are, I think that it is possible that we do achieve that number.
• 3:21
  But the kind of the Debbie Downer from Friday for corn was that new crop carryout, still over 2,000,000,000 bushels, and that's why the corn market has just been stuck since Friday. We haven't had any big enough, friendly enough news to justify a big breakthrough through resistance, so we might just continue to be in the sideways trade pattern for a little while longer. But on the soybean side of things, you know, they did do a small yield reduction, and they did acknowledge that the exports haven't been super fantastic, so they did a reduction in demand for exports on soybeans, and the net result was a slight reduction of ending stocks. So soybean prices had a big push higher on the report morning and then fell lower, but then on Monday the market moved higher because President Trump had said that no, China's gonna show up and buy, and you wanna know what, finally we did get some confirmation of that this morning from Reuters, China's state owned grain trader, COFCO, bought at least 14 cargoes, and then we had the export sale specific flash sale number of 792,000 metric tons was what was announced. So that was very supportive for the market and prices, but now we've digested that here on Tuesday.
• 4:49
  We're not getting a turnaround Tuesday. We're just getting a very blase Tuesday heading into the close with corn up a penny, beans down about 3¢, and wheat just kinda trading steady.
• 5:01
  Todd Gleason: Yeah. And that soybean purchase about 1,000,000 metric ton, roughly 440,000,000 bushels of soybeans. My apologies. It's just the first in what appears to be, should be 12 total tranches, maybe if they do it 1,000,000,000 at a time between now and the December. That's not very much time.
• 5:23
  The market did rally, sharply on that day. Do you suppose soybeans will settle back and they'll wait until that happens and buy another set? Or what do you suppose might happen?
• 5:34
  Naomi Blohm: Yeah. That is what I'm wondering if China's waiting for. So actually, if you look at the price of our soybeans right now versus Brazil, ours are more expensive, period. So it's a very nice goodwill gesture that China did this to acknowledge and honor the trade agreement. But from a business standpoint, I think that they're probably gonna wanna wait for a simple price pullback, which a lot of times can happen in late November.
• 5:58
  But then if we do see the price pullback, I think that they'll show up. So just remember though that this Chinese buying right now just helps us to make sure we meet the USDA projected demand number for exports. So obviously, it's welcome news. We love it. We want it.
• 6:16
  But it just maybe isn't enough just to go, racing higher from here unless we start to see additional export demand on top of that.
• 6:24
  Todd Gleason: You mentioned that, soybeans in The United States delivered to China were more expensive, by how much? I think I saw a buck 20, maybe more than that, a bushel.
• 6:34
  Naomi Blohm: Yeah. That's my recollection on what I saw, from an email that came through, this morning. So, you know, from that standpoint, you know, still cheaper from China, but we are, of course, that window of demand that China needs where South America can't quite meet the demand just because of the calendar window and the dual hemisphere buying and influence that's that. So like I said, I think China's gonna show up. If we can get a little bit of a price pullback, they're gonna, I think, complete their obligations, and it'll be welcomed for The US ag economy.
• 7:10
  Todd Gleason: Anything else before I let you go?
• 7:12
  Naomi Blohm: No. Just keep an eye on all of these weekly daily export sales for demand signals. I think that's gonna be your leading factor for the week. Then also, we're gonna see the December future contracts for grains start to work their way into first notice day. We've got holiday trade coming up, so just be ready for anything.
• 7:31
  Todd Gleason: Hey. Thank you much, Naomi. Naomi Bloom is with totalfarmmarketing.com. Joined us here on the closing market report. It comes to you from Illinois public media at will ag dot o r g.
• 7:47
  In today's agricultural news, fertilizer costs could come down after president Trump issued an executive order to remove import duties on potash and ammonia phosphates or DAP and MAP. Those orders were put in place under IEPA, the 1977 International Economic Emergencies Power Act that Trump had used freely to impose tariffs. Of course, it's now being challenged in the Supreme Court. Let's turn to BOTUS or the waters of The US rule. The Environmental Agency and the US Army Corps of Engineers yesterday released a new proposed definition for WOTUS marking the latest shift in the federal water policy after the Supreme Court's narrow decision in Sackett versus EPA.
• 8:32
  The proposal would limit Clean Water Act jurisdiction to traditional navigable waters and wetlands that share a continuous surface connection with them. Tributaries would qualify only if they directly connect to those waters or flow through other jurisdictional features. The rule also maintains long standing exclusions, including prior converted cropland, waste treatment systems, and a newly clarified exemption for groundwater. Federal officials say the updated definition aims to align the rule with the supreme court's guidance while providing clarity to landowners. A forty five day public comment period will begin once the proposal is published in the federal register.
• 9:12
  And finally today PepsiCo is ramping up its global push into regenerative agriculture reaffirming its target to implement regenerative or restorative farming practices across some 10,000,000 acres by 2030. Company officials say the effort is central to PepsiCo's positive agriculture strategy, which focuses on improving soil health, boosting biodiversity, reducing emissions, and strengthening long term food system resilience. And that's a quick look at today's agricultural news. You're listening to the closing market report from Illinois Public Media. Do visit our website at willag.0rg where you can buy your tickets for the farm assets conference today.
• 9:55
  Up next, we'll talk about the future of grain trade across the planet. Here's some interesting research from North Dakota State University where a professor has found something surprising during a study of the global grain trade. Chad Smith has more from the National Association of Farm Broadcasting News Service.
• 10:20
  Chad Smith: Doctor William Wilson, a distinguished professor in the agribusiness and applied economics department at North Dakota State University, recently undertook a study of the global grain trade. The international grain trading industry has undergone significant and rapid changes during the last fifty years. He said the study took a fresh look at the competitiveness of the global grain trade.
• 10:44
  William Wilson: Yeah, this is a new study that was recently published in Applied Economics, Perspectives and Policy, where we're taking a fresh look at the competitive and global grain trade. This industry has changed radically. We use very micro economic data on shipping and sales and found the market is really not dominated by a handful of companies as traditionally thought. Instead, there's really no dominant player. And in fact, the industry would be considered fiercely competitive.
• 11:10
  Chad Smith: The last study in 2012 said four companies control 73% of the global grain trade. Wilson said his study showed those four companies controlled only about 30% of the market. Instead, some new players are shaking up the grain trade.
• 11:26
  William Wilson: It's not inconsequential that since about 2014, we've seen the growth of state backed trading entities. One is by the name of Kafko, which is Chinese. And then in Russia, there's a group of firms that control the industry that are backed by the Kremlin. More recently, a trading company was bought by SALIC, which is Saudi Arabia sovereign investment fund. And Louis Dreyfus was invested by Abu Dhabi investment fund.
• 11:54
  We have a growth of the state backed entities, which is changing the structure of the industry quite sharply.
• 12:02
  Chad Smith: He talked about how these findings will affect people participating in the industry during the years ahead.
• 12:08
  William Wilson: Competition is thought to be good or I kind of take the view of the reason why there's big firms is because they're small firms. The reason why they're small firms is because they're big firms. But at the end of the day, the competition is more intense than previously thought. As a result of that, margins become more compressed and the competitors seek to be better competitors, providing more differentiation and a wider range of options and flexibility. So ultimately, it's good for consumers, or in this case, farmers predominantly for North Americans.
• 12:36
  Chad Smith: Based on his extensive research, Wilson said the industry should continue to remain fiercely competitive.
• 12:43
  William Wilson: By definition, because of the large number of firms we have, we indicated that there's 38 firms in the competitive fringe. So you got four dominant players and 38 in the competitive fringe plus half a dozen state backed entities that's fiercely fiercely competitive. Will that continue in the future? I suspect that it will at least in the next five to ten years, driven by a number of things, but partly food security, which fosters the development of state backed trading companies, but also the events around climate and deforestation. And all of these point to more ruinously competitive environment during that time period.
• 13:18
  Chad Smith: Again, that's Doctor. Bill Wilson of North Dakota State University, Chad Smith reporting.
• 13:36
  Todd Gleason: Let's turn our attention now to the agricultural energies. Dave Chatterton is here. He's with Strategic farm marketing. Hello, Dave. Thanks for being with us today.
• 13:44
  Dave Chatterton: Hey, Todd. It's always good to be with you here on a, what is not a bright, sunny, warm day here in Champaign. Winter's starting to to set in here a little bit, it feels like.
• 13:53
  Todd Gleason: It does feel like the month of November. Sometimes that brings the doldrums on. I'm wondering as it's related to the agricultural energies, what you've been watching and what winter months generally mean seasonally.
• 14:06
  Dave Chatterton: Yeah. Todd, mean, you know, the start of the winter, of course, is the demand season for for distillates and for heating oil, which is a component of the diesel fuel market. And, you know, the I I guess starting with that point here, we've got even today, we've got diesel fuel up about 10¢ a gallon while crude oil is basically flat. And we've continued to see the distillate side of the complex gain on that crude oil or gain on that oil side of the the mix here as the supplies have tightened. The general sense, we've got distillate supplies and diesel fuel supplies in The US, Todd.
• 14:37
  Currently almost 10% below the five year average where we have a much, you know, more normal situation in the crude oil than the gasoline. So diesel fuel has been outperforming the other two fuels. We haven't seen much movement in in crude oil, but these fuel prices are getting some attention here, and it has to do with, you know, constrained refinery capacity around the world and especially the Russian sanctions here that that have come in play here are beginning to come in play here, just next week.
• 15:03
  Todd Gleason: Do you see that moving into the spring season, and does it mean anything as it's related to producers and what they should do about their needs for planting?
• 15:12
  Dave Chatterton: Yeah, Todd. It's a good question, and there's a a kind of a big, rift in the market right now. Certainly some of the folks like the EIA and some of the trade houses, let's say Goldman or Morgan are calling for big surpluses of oil next year as OPEC brings back production onto the marketplace and lower crude oil prices. The problem is the refining issue is where we come up short on diesel fuel. And you can have all the crude in the world, but you can't refine it into a usable fuel.
• 15:39
  It doesn't do you much good. So that's where we're struggling a little bit, Todd. And I think in a relative sense, limits the downside potential that we have in diesel fuel for the moment. So I think you need to have some in your tank, some under contract, whatever it might be. We certainly haven't purchased everything that we need for next season.
• 15:56
  We're talking maybe the first 20%, 25%, and then being very opportunistic in terms of looking for a decline of maybe 20 or 25¢ to get some needs covered going into the spring. I think the inventory situation is going to continue to stay tight regardless of what these crude prices may or may not do.
• 16:14
  Todd Gleason: Turn your attention to ethanol. What is demand like at this time?
• 16:18
  Dave Chatterton: Yeah. Well, ethanol demand is really good. Ethanol production is really good. We had a record weekly ethanol production, you know, just two weeks ago here in The US. So great domestic production, good exports.
• 16:30
  The problem is we're not using as much corn as we used to make ethanol. The plants in general have gotten better and more efficient at their process and at the refining side of the equation in making ethanol. So where that you know used to be let's say you know a one to a 2.5 or 2.6 type of a conversion between the corn and the ethanol, we're now talking some of the most modern and efficient plants are producing 2.8 or three even three gallons of ethanol per bushel of corn. It's if you put that into context, we're about almost 50,000,000 bushels below where we were at this point last year in terms of corn used for ethanol production domestically. So that's four and a half, 5%, Todd.
• 17:08
  And it puts us a little bit below the seasonal pace that we need to to hit USDA's full year target. Now I mean it's not a big miss. It's maybe 40 or 50,000,000 bushels. But in that sense, it's kind of an interesting development where the ethanol production is at a record high, but we're seeing in the corn use actually slip just a little bit here.
• 17:27
  Todd Gleason: You say demand is good as that in part because exports are good?
• 17:30
  Dave Chatterton: Yes. Certainly, that's a big part of the of the component here. I mean, US gasoline demand is basically flat year over year, seeing some small increases, but regionally, but the export side of the complex, it has been good. It's been good for propane. It's been good for diesel fuel.
• 17:44
  It's been good for a number of fuels here, ethanol included.
• 17:48
  Todd Gleason: What else have you been watching in the ag energies?
• 17:50
  Dave Chatterton: Yeah, Todd. I think it's just the geopolitics. So it's the same thing that we're watching in grain in the in the grain complex here. It takes a little different twist in that Trump administration in coordination with Europe and European nations trying to put some sanctions in place against Russia's two biggest oil producing companies. They're trying to limit the amount of oil that can be bought by China and and India in terms of what comes out of Russia.
• 18:12
  We've also seen Ukraine step up its attacks on Russian oil infrastructure and disrupt last week, something on the order of 2,200,000 barrels a day of exports. Now those have come back online here as far as we can tell you this week, but still very much a dynamic situation on the geopolitical side of the fence, both the political side and the military side. So that's your upside in the oil complex or your risk here is that that unknown turns into a bigger problem than what we have currently on the on the supply side.
• 18:40
  Todd Gleason: And thank you much. We appreciate it.
• 18:42
  Dave Chatterton: Thank you, Todd.
• 18:43
  Todd Gleason: And, of course, is Dave Chatterton. He is with Strategic Farm Marketing. Let's turn our attention now to the weather forecast. Don Day is here. He's with Day Weather in Cheyenne, Wyoming.
• 19:02
  Hi, Don. Thanks for being with me. Tell me a little bit about, what the weather looks like for The United States.
• 19:09
  Don Day: Well, as we go through the, let's say, the next week ahead, fairly unremarkable. We are gonna see some moisture, some rain across the Southern Plains, including Kansas, Oklahoma, parts of Colorado, Texas. Some of that will be mixing in with a little bit of snow as well and some needed rain. They're very good rains have fallen over the last week in California. They'll be getting some more rain here in the days ahead.
• 19:33
  The rest of the nation kinda going through the motions with some fairly typical mid to late November weather. But as we get into Thanksgiving week, we start to see the weather patterns changing on a large scale, not only here in The United States, but Canada and over into Europe as well.
• 19:49
  Todd Gleason: So what does this large scale change mean? Is it just a transition to wintertime? Or is it a transition to a much rougher kind of wintertime?
• 20:00
  Don Day: Yeah. It could be described as the latter because you expect to shift into a winter pattern as you get to late November and early December. That's going to happen, but this is with an exclamation point. We have what's called a stratospheric warming event taking place here in the week to two weeks ahead where the stratosphere in the polar regions begins to warm up that causes the atmosphere to expand and push colder air that's at the higher latitudes to the lower latitudes. And we'll get these stratospheric warming events throughout the course of winter.
• 20:34
  Some winters, have more or less. But what's unusual about this one is it's rare to have one in November. And what this is going to do during the second half or during even the middle part of Thanksgiving week, it's gonna push some very cold air out of Canada and the high latitudes into the Lower 48 states. We're gonna see cold move west to east across the country, middle to the end of Thanksgiving week, end of Thanksgiving weekend. We could even see some subzero temperatures with this wave in the Northern Plains either around or just after Thanksgiving and into that Thanksgiving weekend.
• 21:09
  Todd Gleason: Cold is bad enough, particularly in the plains if there is snow of the livestock there end up with some trouble. Does this come along with a blizzard like conditions at all?
• 21:20
  Don Day: Well, it's hard to use the b word this far out, but certainly winter storm conditions with ice and snow is going to be likely along the Arctic boundary as it works its way through along with big lake effect snows. So this this will be very impactful. And, unfortunately, it's it's timing isn't good for holiday travel, especially that weekend after Thanksgiving.
• 21:41
  Todd Gleason: Okay. Hey. Thanks much. We appreciate it. We'll talk with you again next week.
• 21:44
  Don Day: See you then.
• 21:45
  Todd Gleason: That's Dundee. He's with Day Weather out of Cheyenne, Wyoming. Joined us on this Tuesday edition of the closing market report. It came to you from Illinois Public Media. It's public radio for the farming world online on demand at willag.org, willag.0rg.
• 22:01
  Don't forget as well that you can sign up there today for the farm assets conference that's coming up on the December in Bloomington. The Farm Doc team will be joining us there along with many others details online at willag.org. You can check out the Farm Doc website at farmdocdaily.illinois.edu. Under events in either website, you'll also find a link for the Illinois Farm Economic Summits. Those are the fifteenth, sixteenth, and the seventeenth of the Monday, Tuesday, and Wednesday following the Farm Assets Conference.
• 22:34
  I'll be traveling the state with the Farm Doc team for half day events. The cost is $80 whether you're at the Farm Assets Conference, a full day event at the AgriCenter in Bloomington or the Illinois Farm Economic Summit, a half day event in DeKalb as well as Peoria and Mount Vernon. We hope you will join us. Check out all the details online at willag.org. That wraps up this Tuesday edition of the Closing Market Report that comes to you from Illinois Public Media and University of Illinois Extension.
• 23:07
  I'm Todd Gleason.