Latest / AG Bull / Wiesemeyer's Perspectives | Trump-China-Ukraine-Russia

Transcript

Wiesemeyer's Perspectives | Trump-China-Ukraine-Russia · AG Bull

0:09
SPEAKER_00: Welcome back, everybody.
0:10
SPEAKER_00: Tommy Grossofi, AgBull Media, AgBull Trading.
0:13
SPEAKER_00: You're listening to another Sunday episode of Weezy Meyers Perspectives.
0:19
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0:26
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0:41
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0:59
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1:03
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1:09
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1:13
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1:16
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1:17
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1:21
SPEAKER_00: There's Jim.
1:22
SPEAKER_00: Look at him.
1:22
SPEAKER_00: He's he's there, but we're going to get rid of him because I love him.
1:25
SPEAKER_00: Jim's sitting there ready.
1:27
SPEAKER_00: You got a sneak peek.
1:28
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1:33
SPEAKER_00: With that, let's get in the show.
1:35
SPEAKER_00: Let's bring him on.
1:35
SPEAKER_00: You know he's ready, sitting back there in his maroon egg bull show shirt.
1:42
SPEAKER_00: Now, the music here is pounding.
1:45
SPEAKER_00: I'm in Nashville, Tennessee.
1:46
SPEAKER_00: A little sad.
1:47
SPEAKER_00: The Bears lost their star quarterback, but I'm happy for my Vikings fans.
1:53
SPEAKER_00: The Titans just lost in a nail biter of a game to the Eagles, and the Eagles traveled well.
1:59
SPEAKER_00: They have taken over the streets in Nashville.
2:01
SPEAKER_00: And let me just tell you, for any of our Pennsylvania fans, the Eagles are obnoxious, but overall, great people.
2:08
SPEAKER_00: I met a couple farmers this weekend walking around Nashville, and farmers are always nice.
2:13
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2:17
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2:21
SPEAKER_00: Everything else will be premium moving forward.
2:24
SPEAKER_00: Enjoy the show.
3:04
SPEAKER_00: I do trade markets.
3:06
SPEAKER_00: Why do I care about the Bears or any of these teams?
3:09
SPEAKER_00: Who's your favorite team?
3:11
SPEAKER_01: Well, it's the Commanders, but we suffer.
3:13
SPEAKER_01: We've been suffering for about a decade.
3:16
SPEAKER_01: So let's hope uh the management, which is a better management, brings us uh even better players and victories.
3:23
SPEAKER_01: But I'm a commanders fan.
3:25
SPEAKER_00: Well, we're talking markets, we're talking policy, and you have to be a fan of America.
3:30
SPEAKER_00: Looks like we're coming into a turbulent world here.
3:33
SPEAKER_00: I'll pull up myself and the markets here.
3:36
SPEAKER_00: A turbulent world here.
3:37
SPEAKER_00: My phone was blowing up on Saturday night.
3:39
SPEAKER_00: We are recording this 3:30 Central Time, 4:30 Eastern.
3:45
SPEAKER_00: Oil will open at five o'clock.
3:47
SPEAKER_00: If you need quotes or graphics or anything, give us a call or get a hold of us at Ag Bold.
3:51
SPEAKER_00: Some people just want quotes, real lifetime quotes.
3:54
SPEAKER_00: You have them, whatnot.
3:55
SPEAKER_00: But uh, let's get over the markets.
3:57
SPEAKER_00: That's how you always like to uh start the show.
3:59
SPEAKER_00: Sure week.
4:00
SPEAKER_00: I'm seeing a lot of red here on the quote screen here.
4:03
SPEAKER_01: Yeah, not much green on the screen.
4:04
SPEAKER_01: Look at that.
4:05
SPEAKER_01: Only two in our list.
4:07
SPEAKER_01: Soybean's up seven cents, and soybean meal was the leader uh all week, uh five dollars and eighty cents.
4:13
SPEAKER_01: And that was a combination of reasons that we'll get into later, Tommy.
4:17
SPEAKER_01: But uh that uh the crop uh a number of processors were short products, especially in the northern tier states.
4:26
SPEAKER_01: And they thought uh, although we're ahead on soybean harvest nationally, not in certain states, Minnesota, Wisconsin, uh, Iowa, et cetera, due to the rain.
4:36
SPEAKER_01: And so that's a mainly a cash-oriented aspect, but it got into futures as well.
4:41
SPEAKER_01: But look at soybean oil, just down 146 points.
4:45
SPEAKER_01: We'll get into the reasons why in a bit, but cotton was the loser of the week, down what, 102 points.
4:52
SPEAKER_01: That that was ugly.
4:54
SPEAKER_01: Cattle, we're gonna really focus on this week, Tommy, because it's what came after the Friday settlements.
5:01
SPEAKER_01: That's gonna be more important, which is another reason why I love our program being on a Sunday, because we can look at late Friday developments through the weekend and comment and give perspective on those.
5:13
SPEAKER_01: And the perspective on that is the cattle on feed report on on initial glance should be at least near-term bullish, especially for feeder cattle.
5:23
SPEAKER_01: More on that later.
5:24
SPEAKER_01: Let's go to the next chart, Tommy.
5:26
SPEAKER_00: Yep.
5:27
SPEAKER_00: Crop and livestock futures.
5:29
SPEAKER_00: I love I love looking at information in different uh forms.
5:33
SPEAKER_00: And here it becomes really obvious that a lot of the commodities suffered last week.
5:37
SPEAKER_01: Yeah, look at that.
5:38
SPEAKER_01: The bars are red, but and then we added a little feature here to the right.
5:43
SPEAKER_01: What was the key pressures?
5:44
SPEAKER_01: Our support, corn harvest pressure, technical selling, soybeans, China trade holts.
5:50
SPEAKER_01: That is continuing to lift it up, and boy, we're going to focus on that.
5:53
SPEAKER_01: And some harvest delays.
5:55
SPEAKER_01: Wheat is a combination of export price hurdles, just uncompetitive price, rain in the plains, and long liquidation and harvest, you know, progress.
6:05
SPEAKER_01: Cotton, profit taking.
6:07
SPEAKER_01: I don't think anything fundamental in cotton, from what I can tell, but it was long liquidation and it looked ugly last week.
6:15
SPEAKER_01: And cattle, soft uh beef signals.
6:18
SPEAKER_01: I think in cattle, Tommy, what I'm starting to hear from some supermarket people that I know is a combination of these surging gasoline, but definitely diesel prices, are starting to impact demand for beef.
6:35
SPEAKER_01: It's because it's count, it's it's it's acting like a tax increase.
6:39
SPEAKER_01: So I think we're gonna start seeing more and more reports of a pushback on the demand side.
6:45
SPEAKER_01: That's just speculation on my part.
6:47
SPEAKER_01: So we're gonna see if that happens.
6:50
SPEAKER_01: And uh lean hogs just look ugly.
6:52
SPEAKER_01: Demand uncertainty, weak cash momentum, that they're the dog of the of the of the livestock industry right now.
7:00
SPEAKER_00: And that meal price going up is not good for the hogmen and elevated corn prices compared to really affordable corn and harvest.
7:08
SPEAKER_00: Uh, they're getting hit from all sides.
7:10
SPEAKER_00: Let's jump right into the cattle and feed report.
7:12
SPEAKER_00: And you have a little color on this, Jim.
7:14
SPEAKER_01: Yeah, look at the the September 18th report versus pre-report trade estimates.
7:20
SPEAKER_01: And they were, and we've got some bullish surprises.
7:23
SPEAKER_01: The placement missed the expectations.
7:26
SPEAKER_01: Look at that.
7:27
SPEAKER_01: August, August placements were down 9.2 percent, Tommy, versus an expected 3.2 percent decline.
7:37
SPEAKER_01: It's the lowest hog August total for placements since records began in 1996.
7:45
SPEAKER_00: That's unbelievable.
7:47
SPEAKER_01: Big expectation mix on the on feed, 106,000 fewer cattle than traders anticipated.
7:55
SPEAKER_01: They're just not getting into the uh feed lots, Tommy.
7:57
SPEAKER_01: And I think we're gonna see that in the months ahead now.
8:01
SPEAKER_01: Inventories were below forecast on feed up 0.7 percent versus an expected 1.8 percent increase.
8:10
SPEAKER_01: So the the trade just really missed this report.
8:13
SPEAKER_01: August marketing's down 3.3 percent versus a 3.9 percent decline, actual decline.
8:21
SPEAKER_01: Every weight category declined in South Dakota, Colorado, and Nebraska showed really sharp reductions.
8:29
SPEAKER_01: So, what's the impact?
8:31
SPEAKER_01: Tire prospective supplies are gonna favor early 2027 live cattle contracts, analysts tell me, and they could should support feeder futures.
8:42
SPEAKER_01: Monday's gonna bring the first reaction to Friday's after the close report.
8:47
SPEAKER_01: Now, there's always the other side, some tempering of any rally.
8:52
SPEAKER_01: And analysts cite above Eurogo inventories, softer boxed beef, and the planned Santa Teresa border reopening that we're gonna talk about later.
9:01
SPEAKER_01: That's limited these price gains that we should see initially on Monday.
9:06
SPEAKER_01: Sustained strengthened cattle.
9:09
SPEAKER_01: We need a firmer cash cattle prices and beef demand.
9:13
SPEAKER_01: And I know our good uh friend Mike Sands usually focuses on all that on your daily show.
9:19
SPEAKER_00: He does, and you can catch Mike Sands uh every day here on the premium side for subscribers only before the bell with Mike Sands.
9:27
SPEAKER_00: A nice tight five-minute video.
9:29
SPEAKER_00: And of course, then he meets almost every week with Mr.
9:32
SPEAKER_00: Jed Sidwell, Fat Tuesday.
9:34
SPEAKER_00: This slide says 912026, but we do it almost every week.
9:38
SPEAKER_00: And the Fat Tuesday show is really wonderful with Jed Mike.
9:41
SPEAKER_00: Thanks for talking about those.
9:42
SPEAKER_00: Both premium stuff.
9:44
SPEAKER_00: Okay, you have one more uh little chart here when I think it comes to kettle on feed placement.
9:48
SPEAKER_00: Misses, you talked about these numbers.
9:50
SPEAKER_01: That's what I talked about.
9:51
SPEAKER_01: Yeah, and it just shows you right there.
9:53
SPEAKER_01: Look at the actual, and then I gave you the expectation.
9:57
SPEAKER_01: So, bottom line, the trade missed it report.
9:59
SPEAKER_01: So that's why they were surprised.
10:01
SPEAKER_01: And I think you should, if you don't see higher at least initial prices, there's something else in the market other than this report.
10:08
SPEAKER_01: Okay.
10:09
SPEAKER_00: There were some vicious rumors uh flying around.
10:11
SPEAKER_00: I don't even want to quote what the vicious rumors are, but if you were involved in cattle, you saw it come out on the old X and everything else.
10:18
SPEAKER_00: But you wonder who puts this stuff out, Jim, because these people don't have like you know, you put your name on your social medias at Agbo Media's on our social medias.
10:27
SPEAKER_00: One out of a hundred that something I'd put something that crazy out would be zero.
10:31
SPEAKER_00: Because if it was true, why would I put it out on social media?
10:36
SPEAKER_00: But I'm telling you, it moved the markets and it got people thinking we don't even want to talk about the craziness, but we'll say in this new those are what we went through.
10:44
SPEAKER_01: We the surprise, the placements were very bullish.
10:47
SPEAKER_01: Uh, expectations, miss, inventories below forecast, August marketings, every weight category decline.
10:54
SPEAKER_01: The impact we gave and the rally constraints, we we tempered it with some of these issues that we mentioned.
11:00
SPEAKER_00: Okay, and Jim, for that first round of bullets and headlines, I'm gonna give you an A plus.
11:06
SPEAKER_00: That was good.
11:06
SPEAKER_00: We'll see if you can maintain this level of the whole show, the intensity.
11:10
SPEAKER_01: It took us a year plus, but we finally got it down.
11:13
SPEAKER_00: Lindsay thinks you she loads all this stuff up.
11:16
SPEAKER_00: Lindsay's like, I don't know.
11:17
SPEAKER_00: Jim really got the headline the gift that's here we go.
11:22
SPEAKER_01: Yeah, it's a punch in the nose.
11:24
SPEAKER_01: Other than the Trump G Confab, that looks to take place.
11:29
SPEAKER_01: There were rumors on that too, with uh G's health, okay.
11:32
SPEAKER_01: But he missed an event like uh this past week, but that was due to I guess a chart-term illness, not sure.
11:38
SPEAKER_01: But anyway, diesel is the number one policy issue.
11:42
SPEAKER_01: That's bar bar none, and they're they're a big focus right now.
11:46
SPEAKER_01: Prices U.S.
11:48
SPEAKER_01: retail diesel hit a record six dollars and fifty-one cents a gallon today, Tommy.
11:54
SPEAKER_01: That's that's on on highway diesel, that's up 30 cents in one week, and it's up 76 percent from a year ago.
12:03
SPEAKER_01: Now, farm delivered dyed diesel is lower, but the off-road prices diesel at the farm is up 80 percent.
12:14
SPEAKER_01: A lot of people didn't realize that these diesel is up on a year-to-year basis more than retail diesel.
12:21
SPEAKER_01: That's so that tells you how it's eating into the margins of corn, soybeans, wheat, anything that uses diesel, and most farms do.
12:31
SPEAKER_01: Now, why the supply Middle East disruptions, Russian refinery damage, and that continued over the weekend as we speak.
12:40
SPEAKER_01: Bigly export restrictions are tightening global availability.
12:45
SPEAKER_01: Now, refining capacity remains a major constraint.
12:50
SPEAKER_01: They're they're at almost 100%.
12:52
SPEAKER_01: The fall harvest is adding a seasonal pressure, as farmers, as you well know, fuel combines, tractors, and grain trucks.
13:01
SPEAKER_01: The extension people say farm fuel costs uh are adding eleven doll an acre for corn and seven dollars an acre for soybeans above last year.
13:12
SPEAKER_01: Consider that.
13:13
SPEAKER_01: Look at that.
13:13
SPEAKER_01: And that may be that may be conservative, Tommy, if this price keeps on going up.
13:18
SPEAKER_01: Now, here was a rumor, not a rumor.
13:20
SPEAKER_01: This was talked about export ban.
13:22
SPEAKER_01: Will the U.S.
13:23
SPEAKER_01: ban diesel exports?
13:25
SPEAKER_00: Majority leader, sorry to interrupt you.
13:27
SPEAKER_00: Senator Grassley, one of the last things I wrote uh I read before I went to bed last night, he tweeted about it.
13:35
SPEAKER_01: Is he in favor of it or what?
13:36
SPEAKER_01: I think you wanted to ban X diesel exports.
13:39
SPEAKER_01: Well, majority leader John Thune, uh Republican from South Dakota, he said he was open to considering a diesel export ban.
13:48
SPEAKER_01: Now, that he's majority leader.
13:50
SPEAKER_01: No ban has been announced, okay, but that'll be rumored, and restrictions could discourage.
13:56
SPEAKER_01: If they do this, Tommy, analysts, long-term analysts in the trade say restrictions could discourage refinery production and it could worsen global shortages because you think we would be the only country that bans exports of diesel?
14:12
SPEAKER_01: So, and then look at the signal that gives from a there's no such thing as free trade, a fair trade thing.
14:19
SPEAKER_01: What if countries say, well, if the US banned exports of diesel, why can't we ban exports of products that that we want to keep and they need from us?
14:29
SPEAKER_01: So that's a slippery slope if you get into that.
14:33
SPEAKER_01: I understand why farmers are calling into some of the farm groups saying ban those exports because they're taking up about a third of our supply, by the way.
14:43
SPEAKER_01: I can understand the the pressure, but there are consequences, there are policy consequences to that.
14:49
SPEAKER_01: Now, here's the here's a little update since Friday.
14:54
SPEAKER_01: USDA Secretary Rollins, I think we've got a snapshot of her, don't we?
14:59
SPEAKER_01: She says announcements addressing high diesel cost would come in the following week.
15:05
SPEAKER_01: So she always liked to signal something, but frankly, I don't know what they can do.
15:10
SPEAKER_01: Uh it maybe is there going to be a payment program?
15:13
SPEAKER_01: I don't know.
15:14
SPEAKER_01: Or other details, they're just not known.
15:16
SPEAKER_01: But she gave an interview on one of the news programs last week.
15:22
SPEAKER_01: Uh, not News Nation, the other one, Newsmax.
15:25
SPEAKER_01: And she said on that program, some announcements are going to come within the next two weeks.
15:30
SPEAKER_01: So stay tuned there.
15:31
SPEAKER_01: I have no idea what what it's about.
15:33
SPEAKER_01: Now, if there's a payment program, I don't know where the money would come from.
15:38
SPEAKER_01: I think the Commodity Credit Corporation funding is about right at the level of the$30 billion maximum borrowing authority.
15:45
SPEAKER_01: Now that's replenished in the appropriations uh bill later this year.
15:51
SPEAKER_01: But if you start giving out more money just for a specific topic, I don't know, that could send the signal to uh sellers of diesel just to raise the price.
16:03
SPEAKER_01: I'm just talking out loud there.
16:05
SPEAKER_01: That's usually the case.
16:07
SPEAKER_00: Yeah, I don't go down a crazy rabbit hole.
16:09
SPEAKER_00: But if you're gonna give farmers a uh payment for diesel, what do you do to trucking companies?
16:14
SPEAKER_00: And what do you do to anything every trucking company?
16:17
SPEAKER_00: I mean, if it's on the road, if you see it on a a street, a highway, they're involved in diesel.
16:22
SPEAKER_00: I mean, would I give it to people who own large boats?
16:25
SPEAKER_00: No.
16:26
SPEAKER_00: Uh, if you could afford the boat, you could afford the fuel, but uh then you'd have to think about the airlines.
16:31
SPEAKER_00: Nobody consumes, I don't believe, more fuel than the uh airlines here.
16:35
SPEAKER_01: Yeah, and American Airlines has already uh said they put out a statement last week that prices are going to go up due to fuel cost in the airline industry.
16:44
SPEAKER_01: So I can imagine.
16:45
SPEAKER_01: But the the this the the the scuttlebutt, Tommy, is the internal polls for this November 3rd elections clearly are identifying to the White House planners that diesel costs are a big issue in in farm country.
17:03
SPEAKER_01: And you know, when you get people like Stephen Miller or he's the deputy White House policy director or Scott Bessent or uh Kevin Hassett, National Economic Council, they start coming up with possibilities for Trump to decide on.
17:21
SPEAKER_01: And that's I know one of these reasons that they're I know that they're at least looking at banning diesel exports, but what other things can they do to help temper the price, especially for an important voting entity for Republicans?
17:37
SPEAKER_01: That's the rural vote.
17:38
SPEAKER_01: That that's kind of I think it's behind all this.
17:41
SPEAKER_01: Okay.
17:41
SPEAKER_00: Just to add a little color, I looked at a service called Weekend Wall Street, and that would be the equivalent of just Google it.
17:48
SPEAKER_00: Weekend Wall Street, crude oil is trading up$1.75.
17:51
SPEAKER_00: That's a I don't even know what it's called.
17:53
SPEAKER_00: It would be similar to like our Calci over in Europe.
17:56
SPEAKER_00: Not allowed to Americans aren't allowed to participate in Weekend Wall Street, but to the best of my knowledge, but it seems to be an accurate source.
18:03
SPEAKER_00: So whatever Weekend Wall Street says about the Dow or the SP or Gold and Silver, we tend to start that way.
18:09
SPEAKER_00: I would be shocked if crude oil didn't open a dollar to two dollars higher here tonight, based on uh rhetoric coming out of the Middle East, President Trump uh leaving Camp David early, Pete Heggseth uh leaving the football game early, and then of course the leader of Israel leaving the United States early to go back home to uh tend a business.
18:30
SPEAKER_00: The security's been tightened all over the world, they're sending out alerts, and it looks like things are not calming down, they're heating up on two fronts, both Russia and Ukraine, definitely heating up, and then of course, anything here in the uh Strait of Hermuz or any surrounding areas, Jim.
18:47
SPEAKER_01: Absolutely, and there was some smoke seen at the Saudi Arabian airports, too.
18:51
SPEAKER_01: So you've got, and I think you sent me uh a travel directory warning from the State Department, right?
18:57
SPEAKER_00: Yeah, that's legit.
18:58
SPEAKER_00: That was not fake news.
18:59
SPEAKER_00: Let's move along.
19:00
SPEAKER_01: Trump G meeting.
19:02
SPEAKER_01: This is the big story.
19:04
SPEAKER_01: Uh, let's assume that uh Xi Jinping's going to arrive.
19:07
SPEAKER_01: The focus first, Trump and G's September 24th White House meeting, that's Thursday, could bring additional agricultural tariff relief, improved market access, and clear purchase commitments.
19:21
SPEAKER_01: Now, some of this is already built into prices, Tommy.
19:24
SPEAKER_01: So we're gonna have to have new news.
19:26
SPEAKER_01: Now, soybean and sorghum growers let it be known last week through various statements by the groups, ASA and the sorghum growers.
19:35
SPEAKER_01: They want China's remaining 10% retaliatory duty removed.
19:41
SPEAKER_01: And if that's the case, and I think it will be, that's gonna open up more opportunities for private buyers in China.
19:49
SPEAKER_01: So that opens up.
19:50
SPEAKER_01: That's why this is so significant, but the market wants proof of that.
19:54
SPEAKER_01: So I think it should be positive news if that occurs.
19:58
SPEAKER_01: And U.S.
19:58
SPEAKER_01: trade rep Jamison Greer and Scott Bessant, Treasury Secretary, as we speak almost, are meeting at, I think, Goldman Sachs building with their Chinese counterparts as anticipatory issues.
20:15
SPEAKER_01: Uh they're gonna talk artificial intelligence and other issues with their Chinese counterparts.
20:21
SPEAKER_01: So it's already beginning the talks.
20:23
SPEAKER_01: Now, shipping.
20:25
SPEAKER_01: There's always a shipping angle in this one.
20:28
SPEAKER_01: It looks like they're gonna extend the port fee suspension beyond November 9th.
20:34
SPEAKER_01: That's the current deadline, and that'll protect the peak U.S.
20:37
SPEAKER_01: soybean export season.
20:39
SPEAKER_01: So a lot of people don't report this, but I'll tell you the the exporters in the United States, the National Grain and Feed Association, this is a big issue for them.
20:49
SPEAKER_01: But I think USTR's agre is signaling that that will be extended.
20:54
SPEAKER_01: The key is for how long, though?
20:56
SPEAKER_01: China wants an extension to occur through the life of the Trump administration, but the White House doesn't want to go too far on extensions because they see this as leverage to keep Xi Jinping and China more on honest when it comes to rare earth exports from China into the United States.
21:16
SPEAKER_01: So the the tonnage levels under for the agricultural commodities, existing promises, you'll recall that earlier commitments include 25 million tons of U.S.
21:28
SPEAKER_01: soybeans annually, 26, 27, and 28.
21:32
SPEAKER_01: They're already above the halfway mark.
21:34
SPEAKER_01: I think they're about 60% right now, or close to 60% of the level for 2026.
21:41
SPEAKER_01: And the second and very important component of the Chinese uh reported commitment was at least$17 billion annually in other agricultural purchases with 20 for the next three years with 2026 prorated.
21:57
SPEAKER_01: Now, there's your biggest potential move because until now they have purchased very little outside of soybeans.
22:05
SPEAKER_01: Sorghum they have, okay?
22:07
SPEAKER_01: But if they give This 10% reduction in the uh retaliatory tariffs that will make U.S.
22:16
SPEAKER_01: corn, U.S.
22:17
SPEAKER_01: wheat, and other commodities more export competitive.
22:21
SPEAKER_01: That's why that 17 billion has barely been touched yet.
22:25
SPEAKER_01: And if we get this, that's why it's going to be market sensitive.
22:29
SPEAKER_01: And I mentioned sorghum.
22:30
SPEAKER_01: The sorghum growers are seeking an enforceable annual commitment of five to seven million tons of U.S.
22:38
SPEAKER_01: sorghum to China.
22:39
SPEAKER_01: Again, that's an industry request, not an agreed concession, but we're going to listen to see whether or not they agreed to that.
22:46
SPEAKER_01: And you'll recall we've been talking for months about the U.S.-China Board of Trade.
22:53
SPEAKER_01: USTR Greer has said negotiations are discussing tariff reductions in this board of trade, covering around$30 billion in goods from each country, and agriculture shares remain unsettled.
23:07
SPEAKER_01: We're going to see what part of that$30 billion is agriculture going to be included.
23:13
SPEAKER_01: We're going to, but we need details.
23:15
SPEAKER_01: Livestock.
23:16
SPEAKER_01: Beef and poultry exporters need earlier market access promises by China translated into usable approvals.
23:24
SPEAKER_01: So, in other words, we need proof in the livestock area.
23:28
SPEAKER_01: Bottom line, the market test is going to be additional sales and shipments are going to matter more than renewed pledges.
23:35
SPEAKER_01: Weak Chinese processing margins could limit buying even with tariff relief.
23:41
SPEAKER_01: But they're getting ready.
23:42
SPEAKER_01: They're moving soybeans out of their out of their reserves, Tommy.
23:46
SPEAKER_01: They're getting ready for purchases, additional purchases of U.S.
23:50
SPEAKER_01: sorghum in the months ahead.
23:52
SPEAKER_01: At least a million tons a week, probably.
23:54
SPEAKER_01: Okay.
23:55
SPEAKER_00: Yeah, boy, you sure covered a lot there.
23:57
SPEAKER_00: And I always get confused with that name, Board of Trade.
24:00
SPEAKER_00: That messes me up.
24:01
SPEAKER_01: But uh they should have had a better name.
24:03
SPEAKER_01: Yeah, but what do you know?
24:04
SPEAKER_00: Before we continue, I would look for some headlines to come out maybe even before tonight's open.
24:10
SPEAKER_00: Of course, we'll text clients and alert them if that happens, but they like to get ahead of it and say, Oh, we got something real special coming in, and a big package of this, this, this, and this.
24:20
SPEAKER_00: If they're meeting today, they could have that wrapped up and the rest could be pump and how do you say it?
24:25
SPEAKER_00: Circum what's the pump and circumstance?
24:27
SPEAKER_01: But but listen to Greer, because he's the nerd, he's the detailed guy.
24:32
SPEAKER_01: Besson sometimes he's a smart guy, Scott Besson, Treasury Secretary, but sometimes he gets mixed up on marketing years and calendar years when it comes to ag.
24:42
SPEAKER_01: But Greer knows his stuff.
24:43
SPEAKER_01: So I would have more dumbbell ears for Jamison Greer, what he says.
24:48
SPEAKER_01: So, and they'll they'll go out and and give what they want the public to they'll give their spin on it.
24:55
SPEAKER_01: And then we're after going to see what China says.
24:58
SPEAKER_01: And we monitor South China Morning Post and other Chinese, you know, uh uh papers.
25:03
SPEAKER_01: So yeah, we're we're gonna bring perspective to that.
25:06
SPEAKER_01: But that's your key event this week, and they're they're gonna have a uh full state reception, and then Trump's gonna meet him at Andrews Air Force Base Thursday, I mean Wednesday, and they're gonna have tea on before they leave Friday.
25:21
SPEAKER_01: So this is gonna be a big event from for the White House perspective, okay?
25:25
SPEAKER_00: Very good.
25:26
SPEAKER_00: We had pretty big news this week.
25:28
SPEAKER_00: Fed raised hike, Fed raised rates 0.25.
25:31
SPEAKER_00: The numbers are coming out hot.
25:32
SPEAKER_00: They couldn't help but do it.
25:34
SPEAKER_00: I mean, some people said they should have gone more, some people said the president said they shouldn't have gone, they should actually lower interest rates.
25:39
SPEAKER_00: Of course, if I owed$40 trillion, I'd want a lower interest rate too.
25:44
SPEAKER_01: Yeah, Trump said 1% or lower, okay?
25:47
SPEAKER_01: But the FOMC, that's Federal Open Market Committee, voted unanimously, I think that's important, 12 to nothing on September the 16th to raise its benchmark interest rate, as we call it, to 3.75 to 4%.
26:01
SPEAKER_01: Now, what drove it?
26:02
SPEAKER_01: Inflation.
26:03
SPEAKER_01: Officials said inflation remains elevated and it does, while economic growth, consumer spending, and investment remain resilient.
26:12
SPEAKER_01: So the U.S.
26:13
SPEAKER_01: economy is okay, basis their their their Fed chair Kevin Walsh's comments, but it's sticky inflation.
26:21
SPEAKER_01: And you know, with these fuel prices, Tommy, I'll I almost guarantee you almost a higher inflation for the months ahead.
26:29
SPEAKER_01: And they know that.
26:30
SPEAKER_01: This is not just we know it, and others know it.
26:33
SPEAKER_01: They're going to see rising inflation, sticky inflation.
26:36
SPEAKER_01: So the the another increase is signaled.
26:40
SPEAKER_01: This might be that may not be one and done.
26:44
SPEAKER_01: The median year-end projection implies another quarter point hike to four to four point two five percent.
26:52
SPEAKER_01: 16 of the 18 policymakers projected at least one additional increase this year.
26:59
SPEAKER_01: Now, there's little near-term relief.
27:01
SPEAKER_01: The median projections keep rates at that level through the year end with and with uh for 2027 with inflation forecast at 3.7 percent for this year, well above the 2% target.
27:16
SPEAKER_01: Let me repeat that.
27:17
SPEAKER_01: The Fed's target is 2%.
27:20
SPEAKER_01: They think the 2026 inflation is going to be 3.7%.
27:24
SPEAKER_01: So how are you gonna get them to cut rates when you've got the inflation above their target that much?
27:30
SPEAKER_01: Okay, what's the farm impact?
27:33
SPEAKER_01: Farmers know this higher rates raise operating loan and refinancing cost, a fully passed-through quarter point increase, fully passed through, adds$25,$2,500 annually per 1 million borrowed.
27:47
SPEAKER_01: That's kind of a rule of thumb that we have in farm country.
27:51
SPEAKER_01: Again, every quarter point increase, if passed fully through, adds$2,500 annually per$1 million borrowed.
28:00
SPEAKER_01: So it does have an impact.
28:01
SPEAKER_01: There's no doubt about it.
28:03
SPEAKER_00: Okay.
28:03
SPEAKER_00: Absolutely.
28:04
SPEAKER_00: Yeah.
28:04
SPEAKER_00: Moving along here, nice tight show.
28:07
SPEAKER_00: Number six, Senate Farm Bill 2.0.
28:09
SPEAKER_00: How are we doing with the farm bill, Jim?
28:10
SPEAKER_01: We cleared the Senate AG Committee as we thought with a very he looked sick, Mitch McConnell.
28:17
SPEAKER_01: I I like him as a senator, but thank goodness he is retiring because he needs to retire.
28:22
SPEAKER_01: I feel sorry for him.
28:24
SPEAKER_01: He did, he had a very great career, but it's not ending well because of his health.
28:29
SPEAKER_01: He probably should have quit earlier.
28:31
SPEAKER_01: But anyway, the Senate AG Committee voted 12 to 11.
28:34
SPEAKER_01: That's partisan.
28:35
SPEAKER_01: What does that mean?
28:36
SPEAKER_01: No Democrats voted for it.
28:38
SPEAKER_01: But McConnell provided the decisive vote.
28:40
SPEAKER_01: Now, what's the next hurdle?
28:42
SPEAKER_01: 60 votes.
28:53
SPEAKER_01: Because it has to overcome a filibuster that requires 60 votes.
28:58
SPEAKER_01: So final passage just requires a simple majority, but to get it to the vote requires 60.
29:06
SPEAKER_01: So that's why between now and when they come back after November 3rd, I don't think there'll be a Senate vote before they leave.
29:15
SPEAKER_01: But if there is, then there must be an agreement with the Democrats.
29:19
SPEAKER_01: But if not, they're going to have to compromise with the Democrats.
29:23
SPEAKER_01: Otherwise, they're not going to get the 60 votes.
29:26
SPEAKER_01: Food stamps or SNAP is the central issue, has been and continues.
29:31
SPEAKER_01: The ranking member on the Senate AG Committee, A.B.
29:34
SPEAKER_01: Klobichar, Democrat from Minnesota, she sought a two-year delay in shifting the food stamp cost to the states versus the Senate bill's one-year relief.
29:44
SPEAKER_01: And that's a key issue for attracting Democratic votes.
29:48
SPEAKER_01: But the White House and the House, by the way, is not giving in on that.
29:53
SPEAKER_01: So a House-Senate agreement is needed.
29:56
SPEAKER_01: The House passed its Farm Bill 2.0 in April, and negotiators still must resolve differences, and both chambers must approve identical legislation before it reaches President Trump.
30:09
SPEAKER_01: So what's the likely timeline?
30:11
SPEAKER_01: Watch for a Senate floor date.
30:13
SPEAKER_01: Now that'll come from John Thune.
30:15
SPEAKER_01: With the House on election recess, they're not coming back until after the elections.
30:20
SPEAKER_01: That means to me the post-election lame duck session looks like the practical window for any final action on the Senate farm bill and whether or not we're going to get a new farm bill.
30:32
SPEAKER_01: If not, they'll just extend the 28 farm 2018 farm bill again.
30:37
SPEAKER_01: That's your bottom line.
30:39
SPEAKER_00: That's horrible.
30:39
SPEAKER_00: That's embarrassing.
30:41
SPEAKER_00: Yeah, that pisses me off.
30:43
SPEAKER_00: We need a farm bill.
30:44
SPEAKER_00: All right, number seven.
30:45
SPEAKER_00: Speaking of being upset, Russia-Ukraine.
30:47
SPEAKER_01: More action.
30:49
SPEAKER_01: The huge number of drones is from Ukraine is going into Russian cities.
30:55
SPEAKER_01: Uh today, Ukrainian drones struck Moscow's oil refinery.
31:00
SPEAKER_01: There's your oil impact.
31:01
SPEAKER_01: As Russian attacks continued across Ukraine.
31:05
SPEAKER_01: So that extends the assault on energy and logistics infrastructure that we've talked about almost on every program for the last at least six months, Tommy.
31:15
SPEAKER_00: Long time.
31:15
SPEAKER_01: On that one.
31:16
SPEAKER_01: Yeah.
31:17
SPEAKER_01: So this remember the talk about uh the ceasefire of that.
31:20
SPEAKER_01: That was just last Monday.
31:22
SPEAKER_00: President Trump talked to Zelensky, told him quit bombing Ukraine.
31:26
SPEAKER_01: And uh that lasted about it didn't last.
31:31
SPEAKER_01: So we have a grain grain rail bottleneck.
31:34
SPEAKER_01: The damage to a bridge in Ukraine is restricting the Danube port access.
31:41
SPEAKER_01: Rerouting 3,000 grain wagons are going to take 26 days.
31:47
SPEAKER_01: That's according to Ukraine's railway that I just saw today.
31:51
SPEAKER_01: Commercial shipping is being hit.
31:53
SPEAKER_01: A Russian strike on Ukrainian flag vessels killed its captain and injured three crew members September 17th.
32:03
SPEAKER_01: That underscored mounting risk to Black Sea shipping.
32:06
SPEAKER_01: So your your insurance rates are going up.
32:08
SPEAKER_01: London Marine Insurers expanded the Black Sea's designated high-risk area as vessels attacks increased.
32:18
SPEAKER_01: So higher war risk premiums are adding to grain shipping costs.
32:22
SPEAKER_01: So you're going to have more countries move their grain import needs to Europe and other countries, Australia, and hopefully eventually the US.
32:34
SPEAKER_01: Again, the the market bears say this grain is still there.
32:38
SPEAKER_01: We just can't get at it.
32:39
SPEAKER_01: That's true.
32:40
SPEAKER_01: But if you can't get at it, it's kind of pseudo-grain right now.
32:44
SPEAKER_01: So what's the market impact?
32:46
SPEAKER_01: Transport delays and higher shipping costs are threatening export margins and could improve competing suppliers' position.
32:55
SPEAKER_01: That's Europe, Australia, the United States.
32:59
SPEAKER_01: The reports that we review do not establish a complete shutdown of Ukraine's grain export corridor.
33:07
SPEAKER_01: Some of the grain is getting through somehow, somehow, Tommy.
33:10
SPEAKER_01: But that's your bottom line.
33:12
SPEAKER_01: This is still a Black Sea grain conflict issue, logistics.
33:16
SPEAKER_01: Okay?
33:17
SPEAKER_00: Yep, yep.
33:18
SPEAKER_00: Let's take a little commercial break.
33:19
SPEAKER_00: I'm going to mute your mic, Jim.
33:20
SPEAKER_00: You uh clear your throat.
33:22
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33:22
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34:00
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34:11
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34:14
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34:18
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34:18
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34:21
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34:38
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34:43
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34:46
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34:51
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34:52
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34:59
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35:01
SPEAKER_01: They'll all be included in that package, along with your Intel products.
35:05
SPEAKER_01: Now we're into the US-Iran war now, right?
35:10
SPEAKER_00: If you'd like a US-Iran war, we could make that happen.
35:13
SPEAKER_01: Yeah, I wish we didn't have it, but we do.
35:15
SPEAKER_01: President Trump signaled a decision is approaching.
35:18
SPEAKER_01: Here we go again.
35:19
SPEAKER_01: Speaking to Fox News today, Trump said he was in a quote, deciding mode, describing Iran's options as a negotiated agreement, continued economic deterioration, or a much larger military attack.
35:36
SPEAKER_01: He asked, and this is a direct quote, when do I blow the entire nation up?
35:41
SPEAKER_01: That was a question.
35:42
SPEAKER_01: These were threats, not an announcement that a new offensive had begun.
35:47
SPEAKER_01: Now, Trump's got a history of saying things like this.
35:52
SPEAKER_01: Then we already said he's going to be meeting early this week with Mideast officials.
35:59
SPEAKER_01: Now, in the past, he has said he wanted to go in and be more aggressive on Iran, but Saudi Arabia and other Mideast countries talked him out of it.
36:09
SPEAKER_01: Now, I don't know whether that's going to happen again.
36:11
SPEAKER_01: I'm just bringing up, I wouldn't be surprised if Trump uses that as another reason to back off.
36:18
SPEAKER_01: Now, Iran, they're not sitting oddly by.
36:21
SPEAKER_01: They said Sunday it had information suggesting another U.S.
36:25
SPEAKER_01: attack was being prepared and they threatened sustained retaliation against U.S.
36:31
SPEAKER_01: basis and interest.
36:32
SPEAKER_01: It warned that Washington's regional allies would be considered participants.
36:38
SPEAKER_01: So what's happening?
36:39
SPEAKER_01: Conflict is spreading around the Saudi infrastructure.
36:43
SPEAKER_01: The Houthis Houthis claimed Saturday that strikes on Saudia and an oil facility in Saudi Arabia.
36:51
SPEAKER_01: Saudis had not confirmed those claims, but uh the smoke is arising.
36:55
SPEAKER_01: Washington, as you said, issued a regional security alert warning of a possible escalation, flight cancellations, and airspace closures.
37:06
SPEAKER_01: That was that State Department advanced notice, Tommy.
37:10
SPEAKER_01: Now, a Gulf meeting is expected Tuesday, September 22nd.
37:15
SPEAKER_01: Trump is expected to discuss the Iran war and post-war strategies with Gulf leaders in New York.
37:23
SPEAKER_01: Now that's according to Axios, who's been pretty accurate on this one.
37:27
SPEAKER_01: The countries involved are Saudi Arabia, the UAE, Qatar, Bahrain, Kuwait, and Oman.
37:34
SPEAKER_01: Trump said earlier that he hoped the war was approaching its end, but he's been saying that for six months.
37:40
SPEAKER_01: Trump expressed openness Sunday to meeting Iran's president during the United Nations gathering.
37:48
SPEAKER_01: Washington had authorized the president and foreign and Iran's foreign minister to attend, but permission to attend does not establish bilateral talks.
37:57
SPEAKER_01: So what's the market impact?
37:59
SPEAKER_01: Energy and agriculture market impacts.
38:03
SPEAKER_01: Threats to both Harmuz, continued threats, and Red Sea shipping leave fuel supplies vulnerable.
38:10
SPEAKER_01: And further attacks on Saudi infrastructure could prolong the pressure on diesel and agricultural freight cost.
38:18
SPEAKER_01: Meaningful relief requires restored shipments along diplomatic progress.
38:24
SPEAKER_01: So this is why it's going to take a while.
38:26
SPEAKER_01: Even if you did have agreement, whether or not can you believe Iran?
38:30
SPEAKER_01: And number two, it's going to take a while because of the diesel issues that we previously discussed.
38:37
SPEAKER_00: Unbelievable.
38:38
SPEAKER_00: We're getting towards the end of the show.
38:39
SPEAKER_00: Number nine, U.S.
38:41
SPEAKER_00: Mexican border phased reopening.
38:43
SPEAKER_00: Do tell my friend.
38:44
SPEAKER_01: Santa Teresa is next.
38:46
SPEAKER_01: USDA plans to reopen Santa Teresa, New Mexico livestock crossing Thursday, September 24th.
38:52
SPEAKER_01: Now that will expand limited cattle trade that resumed, if you recall, through Douglas, Arizona.
38:58
SPEAKER_01: And I think now they're up to 900 to 1,000 a day, I think, coming through Douglas.
39:04
SPEAKER_01: But the the importance of Tanner at Santa Teresa is that prior to this over year closing of the border, Tommy, that port amounted to 40% of the feeder cattle coming in from Mexico into the United States.
39:21
SPEAKER_01: So that's important.
39:22
SPEAKER_01: Now, Columbus, New Mexico is included in the reopening plan, but a firm opening date has not been announced in the reports we've reviewed.
39:31
SPEAKER_01: Do we have the graphic up there?
39:33
SPEAKER_00: Do we have the graphics?
39:35
SPEAKER_00: Okay, that's it.
39:36
SPEAKER_01: That graphic says it all because Texas remains on hold.
39:40
SPEAKER_01: USDA's phased approach prioritizes as well as it should.
39:44
SPEAKER_01: Arizona and New Mexico.
39:46
SPEAKER_01: Texas livestock ports are closed because of screw worm concerns.
39:51
SPEAKER_01: Now, there was a horse case of screw worm in Grant County, New Mexico.
39:56
SPEAKER_01: It tested positive for New World Screwworm September 17th.
40:00
SPEAKER_01: Now, I don't think that case is going to delay the Santa Teresa's planned reopening.
40:05
SPEAKER_01: I think that's what uh Rollins had signaled that it will not.
40:08
SPEAKER_01: But reopening still remains conditional.
40:11
SPEAKER_01: Rollins has said trade can be halted again if many new threats emerged.
40:16
SPEAKER_01: So continued expansion depends on effective disease control.
40:21
SPEAKER_01: And I think basically they have control of this from what we know right now.
40:25
SPEAKER_01: That's your bottom line, right there.
40:26
SPEAKER_00: Good look down.
40:27
SPEAKER_00: They're getting they're a lot cleaner.
40:29
SPEAKER_00: These cattle got to be a lot cleaner than half these people I see come through the airport sometimes.
40:33
SPEAKER_01: Yes.
40:34
SPEAKER_01: Yes, yes.
40:35
SPEAKER_01: Okay, we're gonna end it.
40:36
SPEAKER_01: I think we're coming up with the end.
40:38
SPEAKER_00: I wish I had a drumroll sound.
40:40
SPEAKER_01: Okay, Congress.
40:41
SPEAKER_01: The House is out until after the November 3rd elections, and I think the Senate's gonna do the same after this week.
40:48
SPEAKER_01: So the House won't return until November 9th.
40:51
SPEAKER_01: The Senate could follow, as I said, in the coming week, although its published calendar still starts to recess October the 5th.
40:59
SPEAKER_01: Now, the continuing spending resolution, CR, expires December the 11th.
41:05
SPEAKER_01: So Congress must pass full year spending legislation.
41:09
SPEAKER_01: And I think that'll potentially be an omnibus or a smaller package or another continuing resolution, CR, to avoid a shutdown.
41:19
SPEAKER_01: Now we're going to link some things here.
41:21
SPEAKER_01: Farm Bill 2.0.
41:23
SPEAKER_01: A possible lame duck action can take place on Farm Bill 2.0 following the Senate Ag Committee's 12 to 11 party line approval this past week.
41:34
SPEAKER_01: The Senate passage and an agreement with the House remain necessary, as we said.
41:39
SPEAKER_01: Food stamp disputes are a major obstacle.
41:43
SPEAKER_01: Another issue is more farmer aid.
41:46
SPEAKER_01: I think the odds are rather large for an additional farmer aid sometime this calendar year.
41:52
SPEAKER_01: President Trump has already called for roughly$12 billion.
41:56
SPEAKER_01: Senate AG Chairman Bozeman sees the supplemental spending legislation as a possible route.
42:02
SPEAKER_01: Neither chambers farm bill currently provides that aid.
42:06
SPEAKER_01: So that'll could be part of an omnibus spending bill or a separate supplemental spending bill after November 3rd elections.
42:15
SPEAKER_01: What about year-round D-15?
42:17
SPEAKER_01: If we don't talk about year-round D-15, I'm going to get emails and calls from listeners, okay?
42:23
SPEAKER_01: If a farm bill cannot clear both chambers, because remember, the House has already passed a year-round D-15 and a separate bill, the Senate has a different version, but they included it in their version of Farm Bill 2.0.
42:38
SPEAKER_01: But the supporters of E-15 could seek a nationwide year-round E-15 in an omnibus spending bill.
42:47
SPEAKER_01: So just so just because you don't get maybe a Farm Bill 2.0 this calendar year, you could still get year-round E-15 authorization in a end-of-year omnibus spending bill.
43:01
SPEAKER_01: That remains a potential fallback with inclusion depending on negotiations.
43:06
SPEAKER_01: What other business does will Congress likely do?
43:09
SPEAKER_01: Defense authorization, emergency or disaster aid, as we said, Senate confirmation votes are always key.
43:16
SPEAKER_01: And that's going to compete for limited floor time.
43:19
SPEAKER_01: So what's the political outlook?
43:21
SPEAKER_01: Election results, November 3rd, well no, hopefully November 4th, other than California, will shape whether lawmakers strike a year-end deals or whether or not they push major decisions into 2027.
43:35
SPEAKER_01: Because if Democrats win at least one chamber, the House likely, and the Senate's going to be very close, they're going to want to hold off on any major uh major legislation until they're in power.
43:47
SPEAKER_01: A short continuing resolution would reduce opportunities to attach PharmAid and E15 to a broader spending agreement.
43:56
SPEAKER_01: That's how important these elections are going to mean to where Congress are how Congress is going to act in a lame duck session of Congress.
44:05
SPEAKER_01: That's it, Tommy.
44:08
SPEAKER_01: Although some positives in the Trump G ag deliverables, we'll call it, are expected.
44:16
SPEAKER_01: Let's hope we're going to even get better news for more demand for U.S.
44:20
SPEAKER_01: farm commodities, even outside uh soybeans, which they will uh buy.
44:26
SPEAKER_01: They will uh fulfill their commitment to sorghum, corn, wheat.
44:30
SPEAKER_01: And you know, if they start buying corn, uh that that'll put an end to this cyclical downturn, harvest uh downturn, uh, in my judgment, because we're it's not built into USDA's farm export numbers.
44:43
SPEAKER_01: I think they're a big goose egg right now, by the way.
44:46
SPEAKER_01: So that's gonna narrow your stocks-to-use ratio, reduce it more.
44:51
SPEAKER_01: So that's how important some of the deliverables, the actual language that we hear from Jamison Greer, Scott Bessant, and and others, as especially China, coming out of this agreement.
45:02
SPEAKER_01: We're gonna end it there with Catalon Feed.
45:05
SPEAKER_01: We should get a positive initial reaction to that Catalon Feed report, and then we go from there with the all the volatility involved in some of the war meanderings that we discussed in detail in this program through Russia-Ukraine and the US-Iran conflict.
45:23
SPEAKER_00: Great job, my friend.
45:24
SPEAKER_00: Quick reminder Egg Bull subscribers, paid subscribers.
45:27
SPEAKER_00: If there's breaking news tonight, Sunday, I'm working, and you should be too, Mr.
45:31
SPEAKER_00: Jim, with one heck of a roundup.
45:34
SPEAKER_00: See you soon, my friend.
45:35
SPEAKER_00: Cheer.