Latest / Professional Ag Marketing Podcast / Pre State of the Union | Grain Talk February 24th, 2026

Transcript

Pre State of the Union | Grain Talk February 24th, 2026 · Professional Ag Marketing Podcast

• 0:03
  SPEAKER_00: You're locked in to the Green Market Talk Podcast.
• 0:06
  SPEAKER_00: Fast updates, market movers, and the green news you need right now.
• 0:12
  SPEAKER_00: Trading commodity futures and options involve substantial risk of loss and is not suitable for all investors.
• 0:20
  SPEAKER_02: All right.
• 0:20
  SPEAKER_02: Today is February 24th.
• 0:22
  SPEAKER_02: I've got Pat back with us here today.
• 0:24
  SPEAKER_02: How's it going, Pat?
• 0:25
  SPEAKER_02: Good.
• 0:25
  SPEAKER_01: How are you this afternoon, Mike?
• 0:26
  SPEAKER_02: Not too bad.
• 0:27
  SPEAKER_02: We're going to be talking about the grain markets here.
• 0:29
  SPEAKER_02: So what better way to start off this conversation than the event we got going on tonight, Pat?
• 0:35
  SPEAKER_02: We got the State of the Union.
• 0:37
  SPEAKER_02: Just tell me what you're thinking about before the event tonight and what all that could mean for our ag markets.
• 0:43
  SPEAKER_01: Did the USA hockey team make it home?
• 0:45
  SPEAKER_01: They did to Miami.
• 0:47
  SPEAKER_02: I didn't know if they got it.
• 0:49
  SPEAKER_01: Are they going to be at the State of the Union speech tonight?
• 0:51
  SPEAKER_02: They're supposed to, but I know they had a heck of a time in Miami last night, too.
• 0:55
  SPEAKER_02: So I don't know if they would have to.
• 0:57
  SPEAKER_01: Is that what we saw on social media, maybe?
• 0:59
  SPEAKER_02: I think so.
• 0:59
  SPEAKER_01: Yeah.
• 1:00
  SPEAKER_02: Yeah.
• 1:02
  SPEAKER_01: Cade don't show any pictures.
• 1:03
  SPEAKER_02: Yeah, that's right.
• 1:04
  SPEAKER_01: Yeah, I'm not sure if that's the most important point of the State of the Union or not.
• 1:08
  SPEAKER_01: It might be.
• 1:09
  SPEAKER_01: Yeah.
• 1:10
  SPEAKER_01: This is all.
• 1:15
  SPEAKER_01: Who knows where this guy is headed next, right?
• 1:18
  SPEAKER_01: In terms of of um of what he uh was would like to believe is most important uh this week.
• 1:26
  SPEAKER_01: Um, but it is an uh an important occasion for our country, right?
• 1:31
  SPEAKER_01: Uh the executive branch's uh opportunity to report to the legislative branch and and uh judicial and everyone else uh in terms of of the the state of the union.
• 1:40
  SPEAKER_01: So um uh President Trump will make it entertaining.
• 1:43
  SPEAKER_01: You know, I I mean unless he's on uh you know some sort of a kick about getting beef prices lower or something like that, uh or uh I would expect, you know, at some point in in the speech tonight that he uh um applauds uh you know the Mexican government for their efforts, you know, and I think we can talk about that a little bit.
• 2:02
  SPEAKER_01: You know, I I I I think that that was one of the the driving forces behind some of the uh tension between U.S.
• 2:11
  SPEAKER_01: and Mexico, especially as it as it leads up to the US uh MCA uh uh negotiations this summer, um, was uh um you know Trump's request for help as it relates to drug trafficking and and those sorts of things.
• 2:24
  SPEAKER_01: And so and so it'll be interesting to see what his response is there.
• 2:28
  SPEAKER_01: But you know, as it relates to um Mexico and and and and those folks being one of our most important trading partners, perhaps there's uh you know, if you feel a little bit better from a corn farmer's perspective about about uh us being able to maintain, engage, improve relations with them long term.
• 2:47
  SPEAKER_01: In the short run, right, there's some challenges for sure as it relates to to economic activity down there and and and unrest and those sorts of things.
• 2:55
  SPEAKER_01: And so we'll see, you know, where he decides to go with different topics tonight.
• 2:59
  SPEAKER_01: But uh um, you know, that uncertainty uh um can create a little volatility here, and we'll see what happens.
• 3:05
  SPEAKER_02: Especially in when I look at the soybean market, we are a dollar higher today on March soybeans than we were on January 14th at the low on March soybeans.
• 3:14
  SPEAKER_02: So we put on a significant rally ahead of this.
• 3:17
  SPEAKER_02: Donald Trump, obviously, we don't know what he's gonna say or the implications of it, but uh before the meeting, we've rallied a lot on soybeans.
• 3:25
  SPEAKER_02: And especially in the last few trading sessions, it's been really interesting in soybeans to just watch overnight.
• 3:30
  SPEAKER_02: We've been opening quite a bit weaker through the morning session, trading quite a bit higher, uh green through the trading session, and then closing out pretty close to unchanged down the day.
• 3:39
  SPEAKER_02: So we've had some pretty crazy trading ranges on soybeans lately without really getting a whole lot of result out of it lately.
• 3:47
  SPEAKER_02: Very choppy.
• 3:48
  SPEAKER_02: So I'm I'm just curious on the direction from here after tonight, if that has implications, et cetera.
• 3:54
  SPEAKER_01: Well, perhaps as we're talking about the soybean complex, it's appropriate uh to broaden this discussion um out a little bit.
• 4:03
  SPEAKER_01: I mean, that dollar that we've put on the on old crop soybeans in the last month or so um would be largely attributed to uh traders fixated on a on a domestic balance sheet that has the potential to tighten up here um if we're able to maintain um our export volume to other countries and if we're able to layer on top of that um some some uh uh improved Chinese trade.
• 4:30
  SPEAKER_01: Two pretty big ifs.
• 4:31
  SPEAKER_01: And then after all of that, it still doesn't really materially alter the global balance sheet, which is quite comfortable today.
• 4:39
  SPEAKER_01: Yeah.
• 4:39
  SPEAKER_01: And so um I know that our team has been working pretty hard and uh with with our uh producers and and trying to figure out uh some good ways to take advantage of this old crop bean rally and and uh and and I think that's about all a person can say about it, right?
• 4:58
  SPEAKER_02: If there's an urgency to anything that we're talking about right now, it's old crop soybeans.
• 5:03
  SPEAKER_01: Seems like a reasonable thing to be concerned about, especially after we put this buck on.
• 5:07
  SPEAKER_01: And I I mean we we're you know, as we you know, there's not a lot going on in South America as it relates to weather concerns at this point, right, Mike?
• 5:15
  SPEAKER_02: Not a whole lot.
• 5:15
  SPEAKER_02: Uh Argentina weather conditions have been dropping for quite some time.
• 5:19
  SPEAKER_02: Uh, and now this last week we finally got a little bit of a bump up.
• 5:23
  SPEAKER_02: So a little bit of change there recently, but not really market driven at this point.
• 5:28
  SPEAKER_02: It seems like there's other factors that are influencing the soybean market, probably a little bit bigger at the time.
• 5:33
  SPEAKER_01: As long as we're talking about weather, you know, we've had some uh um, you know, we we've been kind of floating around some some U.S.
• 5:40
  SPEAKER_01: drought monitor maps here the last couple weeks, and and uh none of us are gonna get incredibly concerned at all about uh about dry weather in February, especially I frankly in the central part of the belt, we probably welcome it, right?
• 5:53
  SPEAKER_01: Just in terms of of some drier, uh, uh drier temper um drier um forecast here coming up as well.
• 6:00
  SPEAKER_01: But you know, I uh a year ago at this time, Mike, one of our major talking points was uh um a Western corn belt that was trending drier.
• 6:11
  SPEAKER_01: And just the observation as we wrap up the month of February a year ago with, well, you know what?
• 6:16
  SPEAKER_01: There's only been one time in the last 50 years where where we haven't taken out the February highs at some point during the growing season, right?
• 6:24
  SPEAKER_01: Prices are higher in the summer than they are in the winter.
• 6:26
  SPEAKER_01: That's all we're saying, right?
• 6:27
  SPEAKER_01: And and uh and then of course last year was the year that that didn't occur.
• 6:31
  SPEAKER_01: We had a a relatively dry um western corn belt at this time of year last year, and uh that uh resulted in a record crop, right?
• 6:41
  SPEAKER_01: And so, you know, as we sit here a year later now and we look at those same drop monitor maps, now we see it more shifted towards the east and and and and more acute as well.
• 6:51
  SPEAKER_01: There's a there's a couple spots there in Illinois, Indiana, and Ohio that that uh um are uh you know more red on the drop monitor map than brown.
• 7:00
  SPEAKER_01: And so there's some for sure some dry areas here, but you know, we'll just do this again.
• 7:05
  SPEAKER_01: We'll do this again where we say, you know what, two out of the last 50 years are the only two years where you know we haven't taken out winter, you know, highs at some point during the growing season.
• 7:16
  SPEAKER_01: And and so, you know, I just sort of pivot to that topic as we're talking a little bit about South America weather and just say, look, we're kind of on a three-year run here, right?
• 7:28
  SPEAKER_01: Where um it doesn't really matter which hemisphere we're talking about, which crop that we're talking about, we're on a three-year run here of trend to above trend crops.
• 7:36
  SPEAKER_01: China, um, Russia, South America, United States, really kind of all the way through here.
• 7:42
  SPEAKER_01: And and there's not too many times in in our careers where where we've been able to say that, right?
• 7:46
  SPEAKER_01: And and that that doesn't mean that we're going to have some significant weather issues this summer, but it does mean that that uh it's it's worth considering.
• 7:55
  SPEAKER_01: And and and from a real crop producer's perspective, while we've been on a uh a three-year run here or so of a challenging margin environment for the reasons just described, right?
• 8:08
  SPEAKER_01: Um the the the good news is is that um the global balance sheets are manageable, I say in quotes, right?
• 8:17
  SPEAKER_01: I mean I and especially domestic balance sheets, we've been able to hold this corn um projected ending stocks around that two billion bushel number um in spite of a record crop being produced here in the U.S.
• 8:31
  SPEAKER_01: And and uh you know, a cheaper dollar has been a been a huge help in all of that.
• 8:37
  SPEAKER_01: Our exports have been really good.
• 8:39
  SPEAKER_01: But, you know, it's uh um we are sitting here today as we wrap up the month of February this week and and uh um establishing spring price on crop insurance.
• 8:50
  SPEAKER_01: You know, we've got a a uh a lackluster market in the sense that we haven't seen an incredible amount of volatility.
• 8:57
  SPEAKER_01: Um, but you know, we did get a nice little rally here.
• 9:01
  SPEAKER_01: I uh um, you know, the spring price that's gonna get printed um after this week uh for for corn is gonna be a little bit higher than what we would have budgeted a couple months ago.
• 9:11
  SPEAKER_01: And so that's a nice opportunity for us.
• 9:14
  SPEAKER_01: Um, you know, Mike, we've been working on some some uh uh and and been received really well as we interact with our clients as it relates to uh a real nice combination of uh of today's this year's crop insurance opportunities.
• 9:31
  SPEAKER_01: Um they're subsidized differently this year than they were last year, especially when you start to consider those coverages above baseline.
• 9:39
  SPEAKER_01: Um that coupled with some some risk management strategies on the board can work really well in your operation and and uh really create the opportunity for success for your operation.
• 9:50
  SPEAKER_01: I don't want to say regardless of production, regardless of markets, but we can start to check mark a lot of boxes here.
• 9:57
  SPEAKER_01: And this is the perfect time of year to be doing that.
• 10:00
  SPEAKER_01: It's the perfect time of year to be sitting down with your risk management consultant and and uh and and making the right combination of decisions to to position yourself for success as as we get closer to the to the beginning of this growing season.
• 10:14
  SPEAKER_01: And so, you know, we sure would uh like to use this podcast just to uh um just to throw it all out there for you.
• 10:22
  SPEAKER_01: But you know, what'd be better is is for you to to give us a call and and allow for the opportunity for us to to work through that and and and uh and talk through those solutions that make the most sense for your business.
• 10:33
  SPEAKER_02: And the middle of March is coming up fast, so we're gonna be forced into a position here soon, no matter what we do, Pat.
• 10:38
  SPEAKER_02: So it's good to force all that into one bucket.
• 10:40
  SPEAKER_02: Look at your marketing, crop insurance, all those decisions in one bucket, break it down, see what it does for your business.
• 10:47
  SPEAKER_02: Some other things, interesting wise, I I've been following lately here.
• 10:52
  SPEAKER_02: We don't get to talk about the wheat market a lot, but you mentioned drought and funds, some things like that.
• 10:56
  SPEAKER_02: I thought it was interesting because soybeans are building a pretty sizable net long position lately, and that's on data that we would argue is they're jumping ahead a little bit here, right?
• 11:07
  SPEAKER_02: Like, is China really going to buy another 8 million metric tons?
• 11:10
  SPEAKER_02: They seem to be getting ahead of themselves.
• 11:12
  SPEAKER_02: Uh another market that it seems like it's about time would be the wheat market.
• 11:17
  SPEAKER_02: You know, you talked about dryness in the Western Corn Belt, especially in the south.
• 11:21
  SPEAKER_02: And with that lack of moisture and now some pretty cold temperatures, that winter winter kill, they call it, is is pretty substantial on the winter wheat.
• 11:29
  SPEAKER_02: So that's really scared the funds out of some of their short positions.
• 11:32
  SPEAKER_02: They've held on to seemingly forever at this point, Pat.
• 11:35
  SPEAKER_02: So it seems like in the last month we've transitioned to, I mean, we just put on 80 cents on the on the wheat market here over the past month.
• 11:44
  SPEAKER_02: Um, it seems like the funds really want to buy the grains here real recently, as long as they're given a little bit of a reason to wheat.
• 11:51
  SPEAKER_02: It's a little bit easier to back into like, okay, we've had good exports, you got a little weather problem, we were really short, like makes sense.
• 11:59
  SPEAKER_02: The soybeans, it was probably a little bit more of an aggressive stance that they've taken lately.
• 12:03
  SPEAKER_02: So those are a few of the things I've been watching just in the row crop industry that just as an observation, going into the spring here, uh especially late, some of the volatility is picking up, we have some key dates coming up ahead of us, key decisions we'll have to make as well.
• 12:19
  SPEAKER_02: So it's just a few things to keep in mind for all of our decisions, I guess.
• 12:22
  SPEAKER_01: Good points.
• 12:23
  SPEAKER_01: I appreciate that.
• 12:24
  SPEAKER_01: And and uh I guess just to kind of wrap things up here, just a reminder, right?
• 12:29
  SPEAKER_01: If you're uh um just check marking the same old thing this year compared to other years as it relates to crop insurance, and you're you're uh in a little bit of a of a rut and doing the same thing over and over again from a grain marketing perspective, um, we're probably missing out on some opportunities.
• 12:45
  SPEAKER_01: And so uh I think it it uh we we would uh appreciate the opportunity to engage and and visit with you and and uh make sure that we're making the right decisions for your business.
• 12:55
  SPEAKER_02: All right.
• 12:55
  SPEAKER_02: Thank you, Pat.
• 12:56
  SPEAKER_01: Thank you.