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Established 1988
Commodity Week is a weekly wrap-up of the CME Group grain markets with analysis and guest interviews. The program is generally recorded Thursday afternoons and posted online by 7:00 p.m. central. It airs on WILL AM580 during the 2:00 p.m. hour each Friday. Commodity Week is a production of University of Illinois Extension and Illinois Public Media. Like the daily Closing Market Report, it is hosted by University of Illinois Extension Farm Broadcaster Todd Gleason.
website: willag.org
twitter: @commodityweek
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The June 18, 2026, Commodity Week panel analyzed current agricultural market fundamentals, prioritizing export demand, domestic crop conditions, and macroeconomic shifts. China recently purchased 4.8 million bushels of U.S. soybeans, yet long-term fulfillment of their 25-million-metric-ton commitment remains uncertain pending tariff adjustments and sustained export competition from Brazil. Domestically, the market is bracing for upcoming USDA acreage and grain stocks reports, with analysts anticipating slight increases in soybean acreage and noting discrepancies in feed and residual data driven by heavier cattle slaughter weights. The recent Cattle on Feed report indicated a 102% year-over-year inventory, though overall beef production projections remain inexplicably low according to the panel. Furthermore, U.S. corn crop conditions vary drastically based on planting dates, with early-planted corn thriving while late-planted fields struggle against excessive moisture. Finally, macroeconomic volatility is expected to persist as the new Federal Reserve leadership implements a strictly data-driven policy approach, strengthening the U.S. dollar and emphasizing the need for producers to actively execute pricing orders amidst shifting fundamentals.
Panelists
- Jim McCormick, AgMarket.net
- Garrett Toay, AgTraderTalk.com
- Mike Zuzolo, GlobalCommResearch.com
Todd Gleason: This is the June 18th edition of Commodity Week.
announce: Todd Gleason’s services are made available to WILL by University of Illinois Extension.
Todd Gleason: Welcome to Commodity Week. I am Todd Gleason. Our panelists for the day include Jim McCormick at agmarket.net out of Barrington, Illinois; Garrett Toay from agtradertalk.com in Warren, Illinois; and Mike Zuzolo from globalcommresearch.com out of Atchison, Kansas. Commodity Week is a production of Illinois Public Media. It is public radio for the farming world, online and on-demand at willag.org. Our theme music is written, performed, produced, and courtesy of Logan County, Illinois farmer Tim Gleason.
Jim and Garrett, let’s get a list of items from you to talk about. I know Mike is going to join us a bit later in the program. Jim, I think I’ll start with you. What is on your list this week?
Jim McCormick: I think one of the major ones we have to talk about is China. Are they actually in the market? There was talk earlier in the week that they were kicking the tires into beans. What might that mean for the market near term, and how quickly could we expect them to come into the market this upcoming year?
Todd Gleason: Garrett Toay, what is on your list this week?
Garrett Toay: I think you look at China, and you also look at the end-of-month reports. Last year tempered expectations of what to expect for acreage until we get to the August WASDE and the FSA acreage, but we can start seeing these forecasts into pollination and entering the last half of the growing season.
Todd Gleason: Jim McCormick, let’s pick up with you on China. Were they in the market at all in the last week and a half or two weeks?
Jim McCormick: They were in the market. Earlier in the week, there were all sorts of rumors that got the market to rally. There were reports in the cash market that China was looking at purchasing beans. We never could get any hard confirmation from our cash contacts, but this morning, the USDA on their flash reporting system confirmed that China did buy 4.8 million bushels of new crop beans from the United States. There were also some unknown destinations buying another 4.4 million bushels. Hopefully, that is a good sign China is in.
What I am talking about as a wildcard is how the China dynamics work. Back in the fall, China said they were going to buy 12 million metric tons of beans and 25 million metric tons of new crop beans. They did buy that 12 million, but it was all done by a political buy. They never adjusted their tariffs, so the only way they could justify buying the beans is they overpaid for them and bought the US beans. This purchase here—is it the Chinese government buying it, or is it the Chinese processors buying it? When we made this deal a couple of weeks back, the administration said China was going to buy 25 million metric tons of new crop beans and up to 17 billion in additional ag goods. The Chinese said they are going to buy up to 30 billion dollars of goods on the prerequisite that the US lowers the tariffs on 30 billion dollars’ worth of Chinese goods. We are getting this purchase, which is very good, but I do not know if you can reach that 25 million without the lowering of the tariffs. Essentially, we are not going to be competitive.
Seeing these purchases is a good sign. I am hoping it is the beginning of a stronger purchase program. Or, are we going to have to wait to find out what happens? The next time President Trump and President Xi meet is in late September. This means the Chinese have quite a big window to actually make these purchases, or even start the purchases, right in front of the Chinese summit.
Todd Gleason: Just for clarification’s purpose on the Chinese tariffs as it relates to soybeans, China does have an import tariff on soybeans coming in from the United States. If their state-owned agencies bring those in, those do not necessarily have to be paid because it is just a swap within the government. If it was a commercial side importing them, they could waive them, but there is a tariff expected to be collected. Those are two very different things. I am wondering, Garrett, when you think about China as it relates to the coming marketing year, how worried are you, or are you confident that they will be in the marketplace?
Garrett Toay: I had a lot of uncertainty about whether they were going to come in. There are no repercussions if they do not make the purchases. We had this yo-yo effect in the spring; in February, we were going to have the meeting and it was canceled, and we sold off soybeans. Then we have the meeting, we come out, and Secretary Perdue’s comment was that soybeans are taken care of, even though details were unavailable after the meeting in China. We kept ticking the calendar forward, and they weren’t buying anything. You are absolutely right, state agencies do not have to pay the tariffs.
Usually, in the past, whenever they would meet, they would make some sort of symbolic gesture purchase, and that did not happen after this meeting. We kept moving the calendar forward and they had not purchased. I think the timing is interesting. US beans have been competitive with South American beans for non-Chinese destinations because of those tariffs. That was evident today because we had 12-week highs in old crop export sales that were competitive versus Brazil. Is it coincidental that President Trump and Iran signed this MOU last week, and now China starts buying US beans again? I am wondering if there was some sort of Chinese influence to end the situation in Iran. That is pure speculation on my part, but I think the timing is interesting. Why now, all of a sudden? Is this just a ceremonial purchase because of wrapping up the Iran situation?
Todd Gleason: Are you worried that it is only a ceremonial purchase in that case?
Garrett Toay: I like to believe that people are committed to their word. They bought the 12 million metric tons, even though they probably did not have to. I think this is a good step. I expect bean acres to go up in the end-of-the-month report, and this tempers some of the bearishness of a bearish acreage report. If you look at new crop bean spreads, they are starting to tighten up. We are at a juncture where new crop bean spreads started to move wider right about the same time they did this point last year when China was not around. Now, new crop bean spreads are starting to firm up, telling us that maybe the market believes they are going to be around, or they will at least make an attempt at their commitments. I am not writing it in pen because there is no system here. Under the Phase One trade deal, there was a system if they failed to meet their commitments. This is purely a gentleman’s agreement. Obviously, there can be punitive tariffs from the US side of things, but this isn’t like the Phase One trade deal. It is a move in the right direction.
Todd Gleason: It is not written down, there is no pen to paper on this one, Jim. I think maybe the 12 million there might have been, but the 8 million metric tons kind of got lost in January, February, and March. I do not recall whether that came out of China or out of the White House, but it did not materialize. We will have to watch that as well. I guess it just means every day you have to watch the marketplace to see whether China has been in or not.
Jim McCormick: Exactly. Even if it is on paper or written down, we saw that during the first Trump administration, they did not reach their targets. It is something you just have to keep your eye on right now. I am optimistic the Chinese are going to try to do it. There are a lot of political ramifications. Garrett is very accurate. I have always thought the Chinese were the ones pulling the strings behind the negotiations. The Chinese buy a lot of oil from the Iranians. They wanted that solved. On the other hand, we are trying to diversify from rare earths, but it is going to take years to do it. In the meantime, the Chinese have us by the Achilles heel. If they really wanted to play hardball, they could stop shipping the rare earths like they did about a year ago and throw us into a major problem, especially after all the munitions we used in Iran. It is interesting that Garrett made the point; maybe that was part of the deal where China said, get the deal done President Trump, and we will start up on that 25 million metric tons. You never know because none of this is in writing. It is all just pure speculation, Todd.
Todd Gleason: Turn your attention to something that will be in writing, Garrett, and that is the end-of-the-month reports. Both the acreage and grain stocks figures are due out. Do you think there will be many changes in the acreage report as USDA tries to tally up what corn and soybeans were planted across the nation?
Garrett Toay: Last year really fooled me once, shame on you; fooled me twice, shame on me. I do not know what the USDA is going to print. Nobody knows. The bias is, considering the higher input costs, that bean acres increase slightly. Corn acres may increase or decrease. I wouldn’t be surprised to see them lower. It just depends on what the whole acreage pie is. At the end of the day, there was such a big miss last year because of the lack of farmer participation. The USDA has lost the handle on their ability to monitor the situation. I am telling people whatever the USDA prints is probably going to be the minimum. You are probably not going to see acres go down from there. It just depends on how big of an increase you are going to see at the end of the month relative to what the FSA acres are going to show in August. As for changes, I do not think so. If you look at the general trend of the WASDE over the course of the year, there haven’t been many changes at all. Even though corn exports have been running well above the USDA’s pace, they haven’t adjusted the numbers. When they do, they offset with ethanol. At the end of the day, carryout really does not change. I don’t know if that’s a function of budget cuts or if it’s because of the Agricultural Outlook Board, but it just feels like they don’t really want to rock the boat as much as they used to.
Todd Gleason: USDA NASS does all the sampling. For instance, with the grain stocks report, they are doing the surveys, as well as with farmers as it relates to what they are putting into the ground. What are the guesses like at this point that you’re hearing?
Jim McCormick: We will get the hard numbers next week, Todd. I think all the press is asking for the numbers on Tuesday and Wednesday. In general, the bias is going to be somewhere between 94 and 95 million acres. There will probably be some outliers thinking we went way below 94. I am in the 94.5 camp personally. I think we are down a little bit, but the fact of the matter is American producers like to plant corn. In a lot of the big I-states, fertilizer was pre-bought over the winter and fall, so I do not think there is a huge adjustment. Then we are also going to get that quarterly grain stocks report. There has always been a debate all year long about what we fed. The feed and residual number is 745 million bushels higher year-over-year. We do know cattle are at a much heavier weight than they were a year ago. Is that enough to justify that increase? We will hopefully get some clarity on that number as well. This report could surprise people. The government has been very hesitant to make adjustments, so if they make a hard adjustment, the market is going to react to it, even if they end up correcting it down the line. We are going to set up for a little bit of volatility. We trade Wednesday, Thursday, and then we are off for a three-day Fourth of July holiday. A lot of volatility could be building as we end the month of June.
Todd Gleason: Garrett, speaking of that grain stocks report and what the feed and residual number might look like, you are a beef producer. From what you know of yourself and the industry, are beef producers feeding to heavy enough weights at this point that the rate of gain is so much less that they really could use that much grain?
Garrett Toay: I ran the math on it. You calculate the reduced number of head, and you add feeding cattle an extra 1600 or 1700 pounds. You can’t account for the residual aspect of feed and residual, but by my calculations, you are looking at a 350 to 400 million bushel year-over-year increase, versus the 700 that the USDA has dialed in. That is the cushion I am looking for. You don’t know what the USDA considers residual either. If they do consider that residual, then there probably won’t be many changes, but I have prepped people for a couple hundred million bushel difference here just because of the cattle. If it weren’t for the heavier cattle, and if you look at total beef production and how we’re able to maintain relatively steady beef production in the face of lower numbers, it is largely because of this dairy-beef cross and the heavier cattle. That is the only thing that has saved us.
Todd Gleason: Jim, tell me about the competition coming out of Brazil into the next growing season. How much of an issue is fertilizer in the first part of their growing season compared to the second for the export market, and how do you see the export window for soybeans? In the past couple of years, it has shrunk up, returning to when China starts taking soybeans in the new crop year, because they have been able to export later into the calendar year and began exporting sooner, which closed up our window. What do you think?
Jim McCormick: In general, that window has been closing. They have been taking more and more of our market share, Todd. I would argue in the next three, five, ten years, that is going to continue. We are probably going to continue to lose more and more market share to South America, as China tries to disengage from us and engage with all that investment in South America. As for next year, it will be interesting. A lot of the fertilizer South America gets, they get from the Middle East. The Middle East is open, but the crude oil market is breaking hard as we speak. The question now is how much real damage has been done to those fertilizer producers in the Middle East and how quickly they can spin that back up. In general, I think you will see bean acres continue to creep up, but at a much slower pace because of the high cost of fertilizer and bankruptcies spiking in South America. They are having a very hard time financing their crops. We are paying high prices for inputs; they are paying high prices for inputs. The thing that is hurting the Brazilians from what I see is the high interest rates. We think our interest rates are high; they are paying double what we are paying, and that is putting an economic strain on them, which will probably cap their expansion near-term. I believe that trend in the long run is going to expand. That is why this renewable diesel and biodiesel is so critical, and you are seeing that investment. I think that is what we need to continue to see to offset that lost demand we will have as we move through the next three, five, or ten years.
Todd Gleason: 45Z, the RVO, was the question I was going to ask you about, Garrett. If we are not in the export market for soybeans—whether due to competition from Brazil or China not purchasing what they said they would from the United States—domestically, crush has been good. Do you expect that capacity can be built out fast enough to make up for any losses we might have on the world marketplace?
Garrett Toay: I would like to go back a little bit before I get on 45Z. I find it humorous that China has tried to diversify away from the United States as a sole supplier, and they put all their eggs in the South American basket. As far as the tail on the Brazilian crop, the Brazilian bean lineup right now is 11 million metric tons. What was it this time last year? 11 million metric tons. So the bean export program with the bigger crop, the tail should be fairly similar to what it was last year. As far as 45Z and biodiesel, the market is trying. We have massive crush margins out here, and these plants have been running at full tilt for 13 straight months. We have had record crush. There is only so much we can do without increased capacity, and that is what the market is trying to encourage: building more crush capacity. If you look at the historical charts of soybean market share from 2016 to 2018, it went to Brazil, and they haven’t looked back. Even though Chinese demand has flattened—it is not growing at the pace it was ten years ago—Brazil has captured it. That works until it doesn’t. It is an El Niño year; if we have a weather issue, I go back to the 2012 drought. We lost the US corn export market in 2012 because all our buyers realized that South American corn cracked just as well as US corn. It has taken us 12 years to get that business back, and we don’t have that many years left doing this. I think 45Z and biofuels can make up for it, but it is going to take time.
Todd Gleason: Mike Zuzolo now joins us. Hey, thanks Mike for being with us. I know you’ve been busy for the day. We’ve been talking about 45Z, and I had asked whether or not it could help make up any shortfall we might have in exports over time. I am not sure that the coming year is the case, but domestically, whether we could develop enough demand usage. Is capacity really just the constraint at this time?
Mike Zuzolo: Capacity is the constraint. I do think there is an uncertainty I have, Todd, when it comes to the Chinese demand side. I say that because I was hoping that by this point in 2026 they would be done with liquidating their sow herd and be on a more steady-as-she-goes mindset with their livestock production. But I do not think they are there yet. Some of the major crush margins in China right now in their major provinces are deep in the red. In fact, some have gone below the lows of 2025. I think the purchases this week were bought for more political reasons. The question mark for me is, do they really have the structure set up for the livestock demand that we have been used to? I think we all know they are working very aggressively to utilize more of South America and try to become more self-sufficient by 2030, which is just around the corner. It is going to be close is how I would answer it right now.
Todd Gleason: We will be looking at that long term. Let’s stay with feed demand but switch to the Cattle on Feed report, which came out Thursday afternoon. Tell me about those numbers.
Mike Zuzolo: The big thing we have to keep in mind is that the USDA came out with just a little over 102% on feed as of June 1st. The actual number is 11.682 million head; the trade was thinking about 11.73 million. We have two million more head on feed, and yet the USDA is still projecting that we are going to be down in production. Year-to-date slaughter is still down about 9%. Production is down about 6% with higher weights. It is hard for me to see how we’re going to square that circle of having a big increase in fourth-quarter production. They actually have the fourth-quarter production for commercial beef at almost the exact same level as the fourth-quarter production of 2025. That does not add up to me regarding what my clients are telling me they have on feed or what they see in the feedlots. I think the Cattle on Feed report was mostly neutral. Placements came in at 90%, which was the low end. Marketings came in on the very low end at 88.2%. I do not think it fed the bear or fed the bull. So we go back to the top three factors on the consumption side: the stock market, which is still very bullish because of new highs; gas prices, which are down around 50 cents versus a month ago nationally and have gone below $4 a gallon; and the “S” word—no news is good news, no new cases since June 12th. I think that set the market up for a very good move this past week, and I am hopeful this Cattle on Feed report will allow us to test those old highs.
Todd Gleason: If we are going to test those new highs in the cattle market, what happens with corn and soybeans with what appear to be really good conditions? I know you have been traveling in your part of the world. The last time I was out there at the beginning of June, that was a stunningly good-looking corn crop; it surprised me as I was driving through. Is it still that way?
Mike Zuzolo: It is. I just got back from the Emporia area, north of Wichita, on Thursday afternoon, and I would say the crop has never looked so green. But I would also say there are many more wet spots and drowned-out spots than I was expecting. I literally could see, within three miles of my drive down towards Emporia and the edge of the Flint Hills, corn that was getting ready to tassel and corn that was barely out of the ground, maybe six inches high. It gives you an idea that the early planted won out again. If you waited, you really got stuck in the mud. I think it is a lot like the rest of the corn crop: it is going to be really good if we stay cool and wet, but if we have any kind of heat, it is going to struggle, especially if that heat comes around July 4th.
Todd Gleason: Broad macroeconomic thoughts under the new Federal Reserve Head, Mr. Warsh. What do you think?
Mike Zuzolo: This was one of the three big reasons why I was disappointed with the Thursday close, and wheat turning from leader to the upside to the second leader to the downside, with soybean oil being the number one leader to the downside. Warsh is saying he is the new sheriff in town, and this market is going to be data-driven and supply-and-demand driven. We at the Fed are not going to talk as much as we used to to help guide you through questionable times. It is going to increase volatility, but I have to say I love this mindset. I wish we could get it in livestock and grains because I think it puts a real chink in the armor for the algorithmic traders. We have to get back to fundamentals somehow before we have another significant food crisis. There is no question the new 12-month high in the US dollar was not what I wanted to see on Thursday. I think that dinged the wheat and took the market’s focus away from extra heavy rainfall during wheat harvest. I am hearing back in your part of the country—Illinois, Indiana, Ohio—it’s really tough-looking wheat, short wheat, not going to be what it was the last two or three years. I talked to a good client in the Rochelle area; he averaged 105 bushels the last three years and said he will be lucky to get 75 or 80 this point. I think the trade will pick that back up next week if we see the rainfall totals some models are projecting over the next seven days.
Todd Gleason: Let’s get a final word now from each of you. Jim McCormick at agmarket.net, I will start with you. What is your final word for today?
Jim McCormick: Right now, I am going to tell producers to prepare for a little bit of volatility. The market has had a pretty ugly slide here at the beginning of June. From where I am at, we went from incredibly wet in April to incredibly dry in May, to a very wet June. Does that bring volatility in July to swing back dry? Only time will tell. If you have old crop corn and you need to get it moved, I encourage people to get orders working. As I said, this report over the next couple of weeks has headlines that could drive the market. Get your orders working and be prepared to sell into it.
Todd Gleason: Mike Zuzolo at globalcommresearch.com, your final word for the day?
Mike Zuzolo: The big thing to watch the next three weeks, Todd, continues to be the spreads. Notice the July/December soft red wheat spread has gotten back to about 25 under; that is the highest since April of 2025. Meanwhile, July/November corn, old crop/new crop spreads, are languishing near their lows for the contracts. We have delivery coming up. I still think we have a tighter supply in the cash market than the USDA is suggesting for 2025–26. We will see if that is accurate at the end of the month here.
Todd Gleason: And Garrett Toay from agtradertalk.com in Warren, Illinois, your final word.
Garrett Toay: I don’t have much to say on old crop. We have been sold out for three or four weeks now. On new crop, I have been of the bias in corn that, in reality, if it weren’t for this Iranian war, we probably never should have had a chance to sell $5 corn. So we are thankful for that opportunity. Unfortunately, this is going to be another tough year. We had a chance to sell decent corn prices, but our margins are still getting squeezed. Even though the paper crude oil market is lower at $76 today, the physical market and the fundamentals are telling something completely different. If anything goes awry on this MOU, maybe that fires up the inflation trade again. Right now, the corn market has its work cut out for it. This old crop carryout still has to move between now and the end of August and will act like a lead weight on its ability to rally.
Todd Gleason: Commodity Week is a production of Illinois Public Media. It is public radio for the farming world. You may find and listen to the whole program anytime you’d like online at willag.org. Our thanks go to our panelists this week, including Mike Zuzolo, Garrett Toay, and Jim McCormick. I am Illinois Extension’s Todd Gleason.