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- Mike Zuzolo, GlobalCommResearch.com
- The Iran Conflict, Fuel, and Fertilizers
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- The Iran Conflict, Fuel, and Fertilizers
Creators and Guests
What is Closing Market Report?
Established 1985
The Closing Market Report airs weekdays at 2:06pm central on WILL AM580, Urbana. University of Illinois Extension Farm Broadcaster Todd Gleason hosts the program. Each day he asks commodity analysts about the trade in Chicago, delves deep into the global growing regions weather, and talks with ag economists, entomologists, agronomists, and others involved in agriculture at the farm and industry level.
website: willag.org
twitter: @commodityweek
From the Land Grant University in Urbana Champaign, Illinois, this is the Closing Market Report. It is the 03/20/2026. I'm Extension's Todd Gleason. Coming up, we'll talk about the commodity markets with Mike Zuzolo. He's at globalcomresearch.com out of Atchison, Kansas.
Todd Gleason:Eric Snodgrass is away from the office today, so no update of the agricultural weather from him and Nutrien Ag Solutions. However, we will take a deep dive today into the Iran conflict and the impact it is and will continue to have on fuel and fertilizer supplies across the planet. I'll also tell you how to make sure that you're signed up for a free webinar that the PharmDoc team will be hosting on that same subject next Thursday and we'll do all of that right here on this Friday edition of the Closing Market Report from Illinois Public Media. It is public radio for the farming world online on demand at willag.org. Todd Gleason services are made available to WILL by University of Illinois Extension.
Todd Gleason:May corn for the day settled at $4.65 That was 4 quarter cents lower. July at $4.76, down four, and December at $4.90 and three quarters, three and three quarters of a cent lower. May beans, $11.61 and a quarter, 7 and a quarter lower. July down 6 and 3 quarters of a cent a bushel at $11.76 and a half, and new crop November soybeans $11.41 down five at a quarter. Bean meal futures off $4.50.
Todd Gleason:The bean oil 10¢ higher. Wheat futures down 12 and a quarter cents at $6.00 7 and a quarter for the July soft red. The July hard red at $6.18 and a quarter finished 21¢ lower. Live cattle futures up a dollar 72 and a half. Feeders $2.95 higher, and lean hogs 27 and a half cents higher.
Todd Gleason:Crude oil at $98.35 a barrel, now trading up $2.80. Mike Zuzula, globalcomresearch.com out of Atchison, Kansas now joins us to take a look at the marketplace. Hi, Mike. Thanks for being with us on a Friday afternoon again. Let's start with your assessment of the impact that the Iran war has had on the commodity marketplace, and then maybe we can take up what you think that might look like going forward.
Mike Zuzolo:Yeah. I think we're probably just getting into the major impact that it's probably going to have in agriculture, Todd, and what I've talked about with clients and subscribers this week has been two big genies have been let out of the bottle, the energy genie and the drought and weather genie. And between this week starting and this week ending and this is gonna sound a little bit strange at the beginning, but the the two genies are trying to be put back in the bottle with expectations by some in the trade that the Iranian conflict will be over soon. And more importantly, the midweek move by the Federal Reserve, shifted dramatically the trade mindset in inflation and buying other commodities around the energies. And and that means that gold, for instance, is gonna be down over 10% on the week.
Mike Zuzolo:Silver going to be down about 20%, making new 2026 lows. I noticed after the Federal Reserve got done talking on Wednesday afternoon that the trade shifted into its historical bias that, oh, no. Oil price spike equals more inflation equals not only no Fed rate cuts, but probably a Fed rate increase. That is a big deflationary warning flag to the market theoretically, and I think we we took that and ran with it practically speaking. And that's why I think this is not over with yet.
Mike Zuzolo:Both of those genies are still kind of out of the bottle. Qatar has said they lost 17% of their LNG capacity for three to five years. And you're talking about a European gas market that is up about 100% from the beginning of this month versus a US gas market, natural gas market up only 14%, you're you're staring at $5 an average per gallon price for diesel at this stage of the game versus $3.90 about three weeks ago, two and a half, three weeks ago. These are gonna be impactful, I think, to the commodity futures market for quite some time. And I think we just had to get past the Federal Reserve.
Mike Zuzolo:And and last thing I'll say is as to the idea that we're gonna end the war quickly or soon, I hope and pray that's the case, but we still have about 12%, 15% of the crude and petroleum global supplies offline, and that's just the crude and the unleaded and distillates, the natural gas, again with fertilizer prices, that could be years in the making. Right before you and I came on air, the Iraqi oil minister came out and said, We are declaring force majeure on all oil fields developed by foreign oil companies. We don't know what that means. What it says to me initially is, we're done. If you own a foreign oil field in Iraq, we're done as far as working and opening up and and getting production out to the Persian Gulf.
Mike Zuzolo:So we're just getting started on this, and so I think that's something we really wanna keep in mind.
Todd Gleason:I think it's maybe important to go back to something, and I sent this out to you this morning and to others as it's related to, the PBS NewsHour last night outlining where and we'll hear this in just a bit on the program here. The Iranians in the last week or a few days have actually managed to attack facilities, not only nearby but across the region. And as you were thinking about, the longer term here and discussing that, it it's not whether military maybe not whether military action is continuing, but that capacity has been reduced in the area for both fertilizers and fuel, and it may take, as the Qataris had said, some time, years even, to bring that on online and trying to manage how that impacts the price of goods and services and commodities seems like a gargantuan task.
Mike Zuzolo:That that's the genie. Exactly. And and and, you know, like, comparing now with what happened with Ukraine and Russia in 2022, very good comparison the first ten days. 3% of oil taken offline back when Russia invaded Ukraine in 2022. This time around, it started off as about eight to 10.
Mike Zuzolo:Now it's getting bigger, and the market has shown that because I'm looking at a chart right now, and after day 10, both prices for both of those conflicts, the prices had risen about $30 a barrel in the first eight or nine days. By the time you got to day 14 in the Russia Ukraine conflict, the crude was only up $3 versus where it was the day before the the initial attack by Russia. Now we're sitting still about 35, $36.40 dollars a barrel higher in this go around. And so that that just you just nailed it. I mean, this is the genie that can't be put back in the bottle because what I am hearing, to your point, those Shahid drones have been nearly perfected to the point where we have reversed engineered them and are using them in the US military now because some of those can fly 1,900 kilometers and some of them can hover.
Mike Zuzolo:You know, we're talking about a whole different style of infrastructure destruction that we didn't even have back in 2022. So this is this is where I think that what I've told clients, they they said to me, you know, you didn't do the overvalue, undervalue levels this year because of and I stated this, you know, about a couple months ago before this took place, because of the Middle East conflict, because of some of the other geopolitics going on, I didn't feel comfortable doing overvalue, undervalue. And they said, well where would you sell right now? I said, if you got some longs underneath you, and this goes back to our talk on the corn panel, my biggest fear about corn is not corn, it's soybeans, and the soybeans going lower. You take the conflict that we have right now and the cost of fertilizer and diesel and chemicals, and you if you've got six fifty new crop wheat and you've got eleven fifty new crop beans, if they stay at those prices, I don't know why we wouldn't expect five and a quarter to five fifty new crop corn.
Todd Gleason:Okay. So we'll have to think about what that means going forward. I wanna stay with the conflicts, for just a moment because there is one difference between the two besides the players, which is that, oil and gas are there in both. However, the Baltic area, Ukraine, Russia was a wheat exporter. Wheat moved sharply higher.
Todd Gleason:Lead things had a very long tail. On the flip side, and maybe this is what you've already told me is that, you know, we have an extra $30 a barrel, fourteen days into this or longer, and that's because they are a producer of oil and gas and a wheat importer in that area.
Mike Zuzolo:Yeah. And and this is where the currencies play a lot less role. The this with the the oil versus the wheat, and this is where I think the similarities to the two conflicts price wise will probably come back around and be more similar because of the Russian ruble and the US dollar and the competitiveness of Russia in that part of the world and being part of the New East and being able to get into the Middle East, you know, letting Iran letting Russian vessels through the Strait Of Hormuz would make perfect sense to me, including wheat. And so that's that's the big thing we have to watch. I think that showed up along with the Federal Reserve reality check, we'll call it, and the Fed trying to put the genie back in the bottle when it came to food prices and and potentially raising rates because, historically, that's what they do.
Mike Zuzolo:I think the wheat felt that, especially with that 21, 22¢ decline. Wheat was one of the biggest leaders to the down downside on Friday. I think it was the Fed, and I think it was the very hard down week we saw in the Russian ruble. But, again, these, I think, are probably in the context of what you and I are talking about shorter term features. We still need wheat to help us in the corn market overall, but I can I can divorce myself from the wheat market and the corn market in a circumstance we're getting into?
Mike Zuzolo:And the last thing I'll throw out at you is the the conditions on the wheat this year in in The United States is, I think very serious and the trade really doesn't care about it yet. And you know Oklahoma, Texas, Colorado all at 15%, 18%, 29. Those three states make up about a third or almost 40% of the winter wheat crop that we have in terms of acres, and trade did not really do much at all with that this week.
Todd Gleason:Yeah. They need some weather to help out that crop and to ensure that winter kill actually doesn't take place, I think, too, or at least tillers come back in. So they'll need good weather to pull that off. I do wanna stay with with the the Strait Of Hormuz, what's happening in Iran, The Middle East. So I I'm thinking through some of this and wondering if, for instance, China has said or maybe is thinking about saying it's not clear to me yet, we're going to protect our domestic fertilizer supply fertilizer supply.
Todd Gleason:So those come off of the marketplace. What has already come offline for both fuel for fuel and fertilizer in the Mideast, that's going to raise the price for inputs across the planet for fuels and fertilizers to put crops in the ground and harvest them. Well, also, I wonder if if the price of grains and oilseeds will follow along, and in the same boat, if there will be enough profit for acres to continue to be planted, or will it will it just force the number of acres down?
Mike Zuzolo:Yeah. That's yet to be determined. I mean, we hope that economic theory works, and that because it's more expensive to put in the ground, you get a bigger return on investment, especially with the diesel and and fertilizer prices. I I think one thing that I'll talk about in the short term that relates to your question, but probably isn't directly on it, is the White House celebration of agriculture next week. I think that's gonna be a pretty big deal because we've seen the Trump Xi meeting rescheduled.
Mike Zuzolo:We don't know the new date, and we've seen that Chinese soybean imports for January and February to from The United States were 1,490,000 tons versus 9.13 a year ago for those two months. That's almost a 90% decline. These two pieces of news, these two fundamental factors really have not been traded at all in the markets. And I think it's because they're the trade is waiting to see if there's a big announcement next week on the celebration of agriculture at the White House. And so that that's where I really am nervous about the soybeans, given the fact that we we're pretty set on the South American production levels at this point.
Todd Gleason:Anything else we ought to talk about before I let you go?
Mike Zuzolo:Just the big cattle on feed report on Friday. You know, we've gotta match that up against the placements, especially up against this big down in the in on Wall Street. That looks like it's just starting to me. If the crude oil is just starting to go up, there's about a 90% negative price relationship between crude futures and the S and P 500 over the last four weeks. So that's really key to the cattle, the consumption, the wealth effect, the gas tanks, and summer grilling season.
Todd Gleason:Hey. Thanks much, Mike. Great to
Mike Zuzolo:be with you, Todd. Thank you.
Todd Gleason:You're so welcome. That's Mike Zuzlow. He's at globalcomresearch.com out of Atchison, Kansas. Joined us on this Friday edition of the Closing Market Report that comes to you from Illinois Public Media. Our theme music is written, performed, produced in courtesy of Logan County, Illinois farmer Tim Gleason.
Todd Gleason:Now if you can stay with us for the whole of the hour, you'll hear our commodity week program in its entirety. Panelists this week include Seth Vanderweide. He is with Logic Ag Marketing out of Iowa. Brand new to the show, a great addition. We'll also have on hand Greg Johnson from TGM, Total Grain Marketing, and Sherman Newlin.
Todd Gleason:He's with Risk Management Commodities, a Zaner ag hedge company. You wanna join us for commodity week? You can hear that online in its entirety right now @willag.org. Many of these radio stations will carry it over the weekend. And, again, on our home station in its entirety, if you can stay with us for the whole hour today.
Todd Gleason:Let's turn our attention now to the war with Iran. During the middle part of the month of March, Iran attacked a series of oil and natural gas facilities. Here, we'll detail the damage done and the impact it may have on the world's fuel and fertilizer supplies. The Iranians have struck a Saudi Arabian oil facility on the Red Sea, a natural gas complex belonging to Qatar, and oil facilities belonging to The UAE. In an appearance on the NewsHour from PBS, former US ambassador to Qatar, Susan Siyade was asked about the importance of those particular facilities.
Susan Ziadeh:Well, first of all, the the breadth of the number of countries that have been hit. This isn't directed at one country, but at all a number of countries in the Gulf Cooperation Council known as the GCC. The ones the hits against the SAMRF, which is the Saudi Aramco refinery, which is jointly owned with ExxonMobil, is in Yenbo. Yenbo is on the Red Sea, and that's at the end of the East West pipeline, which was designed to get around the problems of the Strait Of Hormuz and shipping out of the Strait Of Hormuz. So in essence, the Iranians have hit plan b by hitting Yenbov on the Red Sea.
Susan Ziadeh:In terms of some of the other facilities, they struck in Fujairah, which is also a port at the end of the pipeline in The United Arab Emirates, which is also outside of the Straits Of Hormuz, and tankers have been unable to go and fill up there at the Port Of Fujairah due to strikes.
Todd Gleason:Again, that's Susan Ziadi. She spent much of her twenty year foreign service tenure focused on The Middle East and is now a senior adviser at the Center for Strategic and International Studies. That's a think tank in Washington DC. We're listening to a portion of the interview she did with Jeff Bennett from the PBS weeknight newscast called the NewsHour. In it, Ziyadi also discussed the Iranian hit on the liquefied natural gas facility at Ras Laffan in Qatar.
Todd Gleason:This came after Israel bombed the South Pars gas field. She said Ras Laffan is the lifeline for Qatar.
Susan Ziadeh:20% of the world's LNG exits from the Strait Of Hormuz from Qatar.
Todd Gleason:About $26,000,000,000 have been poured into that complex over the last two decades, including funds from ExxonMobil. It consists of 14 production facilities. It's estimated the Iranian raid reduced Qatar's LNG capacity by 17%. It'll take between three and five years to rebuild. The world's largest GTL or gas to liquid facility was damaged also.
Todd Gleason:It's operated by Shell and makes diesel, jet, and marine fuel. Now Shell has halted production there. This destruction came in response to an Israeli raid on the South Pars gas field. It's operated by Qatar and Iran. 90% of Iran's electricity comes from the gas produced in South Pars.
Todd Gleason:It also provides gas for cooking and heating. The other part of the gas field which is the Qatari side is more productive. 20% of the world's LNG is produced there and exported through the Straits Of Hormuz. Importantly, the LNG is used also to make fertilizers and helium. The helium is used in the medical industry and for semiconductor technology.
Todd Gleason:The fertilizer is nitrogen. Natural gas is the primary raw material used to produce nitrogen based fertilizers like ammonia and urea. The world's largest urea plant is in Qatar and following attacks on the LNG facilities, Qatar Energy shut down the urea plant. The American Farm Bureau Federation notes the Persian Gulf as a region accounts for nearly 49 of global urea exports and roughly 30% of global ammonia exports. Qatar is the world's fourth largest exporter of nitrogen fertilizers with a 5% global market share.
Todd Gleason:The economic reaction has been severe and immediate. Urea export prices in The Middle East surged by about 40, jumping from under $500 to over $700 per metric ton. In The United States, fertilizer prices have also spiked. FBF notes roughly 97% of potassium fertilizer is imported into The US, 18% of nitrogen, and 13% of phosphate. This makes the ripple effect and timing of this nitrogen disruption despite 80% of use being produced domestically critical because it coincides with the spring planting season.
Todd Gleason:Agriculture is a planet wide network. For instance, countries heavily reliant on Qatari LNG like India have had to cut output at their own domestic urea plants due to the lack of gas supply. Analysts warn that if the conflict drags on, fertilizer prices could double, which would inevitably translate into higher food prices across the globe. Farmers are closer to that supply chain disruption, and University of Illinois agricultural economist Gary Schnicki says it's already taken a toll in The United States.
Gary Schnitkey:This conflict obviously is having a immediate impact on fuel and fertilizer prices, and, we've see now see anhydrous ammonia over $900 a ton, and some of the an anhydrous ammonia and all the the fertilizers were going up before this, but, the conflict has increased that increase.
Todd Gleason:Possibly complicating matters is news China may move to reduce its fertilizer exports to protect domestic supplies as well. This would put an additional strain on global markets. China is among the largest fertilizer exporters shipping more than 13,000,000,000 worth last year. Schnitke is a member of the FarmVoc team at the University of Illinois and will be cohosting a webinar Thursday on the impact the Iran conflict is having on fertilizer and fuel supplies. He says his colleague Nick Polson will be on hand too.
Gary Schnitkey:More importantly, we have two guests joining us, Gretchen Cuck from the National Corn Growers Association who looks at the geopolitics of this and, can provide some insights on where those things are are are are going as well as Chuck Spencer from Growmark. So it will be a we'll we'll have a good discussion. I don't know if we will resolve anything at that that point in time, but it will be a good discussion.
Todd Gleason:You may join the discussion live Thursday morning, March twenty sixth at 11AM central. Visit the PharmDoc Daily website to sign up under the events webinars tab. The webinar's free. You may join live Thursday at 11AM or watch it after the fact on YouTube. Look for it at pharmdocdaily.illinois.edu under the Events and Webinars tab.
Todd Gleason:You've been listening to the Closing Market Report from Illinois Public Media on this Friday afternoon to visit our website, willag.org, where you can listen to the programs again. Just click and play right there from willag.org, or you can look them up in your favorite podcast applications, places like Apple, Spotify, and YouTube. I'm extensions Todd Gleason.