From the Land of Grand University in Urbana Champaign, Illinois, this is the closing market reported as the March 2025. I'm extension's Hudgleson. Today, president Trump imposed aluminum and steel tariffs across the board on many countries. Canada and Europe have both responded, and the marketplace has moved sharply lower. We'll hear about that with Greg Johnson from TGM.
Todd Gleason:We'll discuss the weather forecast with Drew Lerner, and we'll have a final update on crop insurance decisions during this Wednesday edition of the closing market report from Illinois Public Media. Todd Gleason services are made available to WILL by University of Illinois extension. I made corn for the day settled at $4.60 and 3 quarters, down 9 and a half cents. July at $4.67 and a half, 9 and a half lower. December, down six and a quarter.
Todd Gleason:Settlement price there at $4.48 and a quarter. May beans at $10 and a half cent, down ten and three quarters. July 1015 and a half the dime lower. And November beans at $10.00 6 and a half, down 9¢. Bean meal, a dollar 60 lower.
Todd Gleason:The bean oil off 25¢. Soft red winter wheat, down two and three quarters. The hard red down a penny rather up a penny for the day. And the live cattle futures were up a buck 85. Feeders, 3 dollars and 2 and a half cents higher.
Todd Gleason:Greg Johnson with Total Grain Marketing, that's TGM, the elevator system here in Illinois, parts of Indiana, and the elevator in Champaign County now joins us. Thank you, Greg, for being with us. As you and I are talking, the markets are down hard. This is before the close, so things may have changed. But at least at this point, they're down hard and probably will be typical of the volatility in trade that we can look forward to through, the rest of this marketing year and, I suppose, maybe the next one too.
Todd Gleason:What's happening in the marketplace today?
Greg Johnson:Well, from a fundamental point of view, there's very little new news. The trade is a little disappointed that USDA, in their monthly supply and demand report on Tuesday, did not increase ethanol exports or corn exports. But USDA said that they are taking into account, trade issues when estimating future export demand. So, with all the uncertainty with the trade talks and tariffs and whatnot, that's probably understandable that they did not increase, corn or ethanol exports. Today, macroeconomic issues, are taking front and center stage, trade tensions primarily.
Greg Johnson:The tariffs that, US announced would take effect on, steel and aluminum from Canada took effect at midnight today at last night, so those are now into effect. And Canada has announced, retaliation. They said that they will put a 25% tariff on more than $20,000,000,000 worth of US goods, in retaliation for the tariffs that, went into effect overnight and that they could put more on at some point in time. And, of course, The US said, well, if you put more on, then we may increase our tariffs to 50%. So, you know, we're we're in the midst of this tit for tat, back and forth, you know, tariff, trade war, basically, is what it is.
Greg Johnson:Potential trade war. I hope it doesn't, last or or come into come to fruition, but, that's what the market is worried about. And it's not just, commodities. The stock market is down hard. The Nasdaq is down double digits since the first of the year.
Greg Johnson:The Dow is down over 8% since the 1 the year. Corn is down over 11%, since the February highs. Beans are down 8%, since the February highs. So it's it's a broad based sell off in both stocks and commodities.
Todd Gleason:Yeah. Just a point of clarification. So the USDA yesterday said what was in place, it was taking into account. There were some things that were already in place, but the new tariffs imposed today by both US and Canada would not have shown up in yesterday's figures. That brings me to why corn is down so hard.
Todd Gleason:Do we know if Canada is retaliating with a tariff on ethanol imported from The United States? I would suppose that's probably one of the bigger reasons if that's the case, or maybe it's just speculation still at this point.
Greg Johnson:I think it's still speculation, but I think they've said that they are going to target commodities that will hurt, Trump's voter base. And so the Midwest, is a strong supporter of Trump, and so ethanol would obviously be a logical choice. So I don't think that's been made public yet, but, certainly stands to reason that that's something that they would consider targeting.
Todd Gleason:How do you suppose producers should think about the volatility today and that that we will see going forward?
Greg Johnson:Well, we've lost 60¢ in the corn, so I think the the the horse is out of the barn, as far as that's concerned. Could we go, you know, the 20¢ lower? I suppose we could, but we've got the whole growing season ahead of us. There's still forecast of dry weather. We're certainly gonna start off on the dry side.
Greg Johnson:So, demand in out of Mexico, is still very good. South America is two to three weeks behind on their double crop corn planting. So, there's potentially bullish things out there. I think there is a story for corn. So at this point, since the market sold off 60¢ on corn, I think it's it's probably prudent to be patient and, wait and see what happens.
Greg Johnson:And, hopefully, we get some kind of a resolution to either the trade talks or we have some weather problems on down the road, and then other countries will be forced to buy regardless of the price or regardless of their political, ex expectations. So at this point, I think we just need to be patient. But in the big picture, I think, you know, the the corn care or the corn story is a little bit better than the bean story. So if if if beans would rally and get back up above, you know, that midpoint level of ten and a quarter November futures, probably wouldn't be a bad place to start being a little bit more aggressive and get beans sold.
Todd Gleason:Just remind us of the fundamentals that make the corn picture a little better than the soybean picture.
Greg Johnson:The the trend is it has, has narrowed up. We we've gone from a 2.1, two point two billion bushel carryout in every month for the last five, six, seven months. We've taken a hundred million off of that to the point where we're now at 1.54, and that number stayed unchanged. So we didn't technically, lower the carryout, but the we certainly didn't increase it either. So we took a pause this month, and we'll see what happens next month.
Greg Johnson:But, the trend has been narrowing up, and we've had demand for corn. Whereas soybeans, not as much demand. We know that China, you know, and we haven't even talked about China's trade, war prop problems with The US, but, we know China is probably gonna buy as many beans as they can from South America. South America's crop continues to get bigger. And even though The US ending stocks number is relatively the same for corn and beans, if you look at the world stocks number, world stocks ending stocks for soybeans is over 30, whereas corn, it's only around 20%.
Greg Johnson:So I think there's a a better story for corn. Any kind of a hiccup as far as production, probably would affect the corn price a little bit more dramatically than it would soybeans.
Todd Gleason:And finally, I know you've talked about this in past, but the export window for US soybeans because of a large crop soybeans, because of a large crop coming out of South America, maybe a little bit later too, gets smaller, this year than it has been in previous some previous years.
Greg Johnson:That's right. South America, Brazil primarily, got their beans planted later, which obviously doesn't affect, their production. They can they can plant beans late and still have a good crop. It's it's they're all growing during the the rainy season. It it does potentially impact their corn, you know, because it will be pollinating and filling during more of the dry season.
Greg Johnson:But what it does do with soybeans, since they planted them later, they will be harvesting them later, and they will be exporting them later. And so a lot of times, they'll be done exporting in October, and we'll have that October, November window to ourselves for exports. Well, this year, South America could very easily still be exporting into October, and our window may not, start until November or December. So with beans being harvested here in The US in September and October, if we don't have an export window, that's not good. Basis levels may reflect that, by being weak, during that September, October time frame until demand starts showing up.
Todd Gleason:Thank you much, Greg. I appreciate it. Thank you, Todd. That's Greg Johnson. He is with TGM.
Todd Gleason:That's Total Grain Marketing. If you'd like to learn more about the South American crop season, and here's some updates about the soybeans, corn, and export markets, we'll do that tomorrow with the FarmDoc team at 03:00 in the afternoon. There is a webinar then with Joanna Colussy and a colleague of hers from the National Institute of Agricultural Technology in Argentina. By the way, CONAB, Brazil's counterpart to USDA, will update its figures tomorrow morning, and we'll have those on our website at willag.org early. This quick note on crop insurance.
Todd Gleason:The deadline for the decisions is approaching for Corn Acres Revenue Protection, or RP, with high coverage levels at 80 or 85% is recommended by the ag economist at the University of Illinois, along with considering the enhanced coverage option, or ECO, says Gary Schnitke.
Gary Schnitkey:We would recommend that, like they have done in the past, farmers take RP at a at a high coverage level. Most Illinois farmers in Northern And Central Illinois take that at 8085%, that would be a good place to be. And then, think about ECO on top of that. If they want to do an ECO as county level crab reach from 90 to 95% down to 86%, And you if you're concerned about, lower revenues, that that would be a good alternative, this year and just consider it. That's not a firm recommendation.
Gary Schnitkey:Just consider it.
Todd Gleason:The FarmDoc team also analyzed the supplemental coverage option or SEO. They wrote in the FarmDoc Daily article this week that because ARC County is likely to provide higher payments this season, it's probably best to skip SEO in most circumstances. Our county is the recommended choice for corn and soybean base acres due to its higher expected returns compared to PLC. While SEO is an option, historical experience suggests limited payments in Illinois, making our county a more reasonable farm safety net choice. Again, farmers should consider higher crop insurance coverage levels this season at 80 or 85%, possibly pairing it with ECO coverage to 95%.
Todd Gleason:The crop insurance decisions are due within the next few days. The ARC PLC decision is due in mid April. Up next, sometimes in rural America, the grocery store is really far away, and it may not be easy for some to get to. Largely, this is due in part to the disappearance of independent grocery stores in small towns. To push back against this trend, more states have created grant programs to support small grocers.
Todd Gleason:As Harvest Public Media's Rachel Kramer reports, the stores are part of the backbone of many rural communities.
Rachel Kramer:In the backroom at Wood Supermarket in Deli, Kent Wood and his son pull the plastic away from a pallet stacked with boxes. One contains bottles of ketchup, others hold canned soup and pasta.
Natural Sound:O four five one two.
Rachel Kramer:While unloading, they call out numbers printed on each box to check off inventory.
Natural Sound:And then at twenty one
Rachel Kramer:On truck delivery days, Kent gets here at 04:30AM.
Kent Wood:I wouldn't come to work and work as many hours as I do if I didn't like it.
Rachel Kramer:Wood's Supermarket and Deli sits in front of a grain elevator in Pocahontas, a town of about 1,800 people in Northwest Iowa. While a few dollar stores sell food, this is the only grocery store in town. Ken's wife and store co owner, Kim Wood, says the closest alternatives are outside the county lines, about twenty to thirty minutes away.
Kim Wood:Yeah. The elderly population, especially in the wintertime, they don't wanna drive out of town to get groceries, and I think that would be a hardship.
Rachel Kramer:Rural policy experts say grocery stores are vital for communities to thrive, but the number of rural independent grocery stores in The US has steadily declined in recent decades. To help reverse this trend, half a dozen states, including Illinois, Minnesota, North Dakota, and Oklahoma, have passed legislation in recent years to develop grant programs for grocers. Now lawmakers in Iowa and Nebraska are pushing to create their own versions. Jillian Linster is the senior director of policy at the Center for Rural Affairs. The organization is advocating for both bills.
Jillian Linster:Our staff live and work in the communities that we serve. And so we were seeing in our everyday lives that, more and more stores were closing or struggling to stay open.
Rachel Kramer:A recent study found the number of rural independent grocery stores in Nebraska declined by 30% from 2016 to 2021.
Jillian Linster:Rural independent grocers are operating on extremely slim profit margins, sometimes as little as 1%.
Rachel Kramer:Competition with dollar stores and supercenters in the region are one of the biggest challenges for independent grocers. Fewer customers from population loss, rising operating costs, and aging equipment are also factors. Chad Engles is one of the Republican representatives who introduced the grocer reinvestment bill in Iowa. During a noisy subcommittee meeting, he said a grant program could make a big difference for mom and pop grocery stores.
Chad Engles:And I hear from all of them, we're just one freezer breakdown, one cooler breakdown from shutting the door.
Rachel Kramer:While the Nebraska and Iowa bills are slightly different, they both aim to help rural independent grocers pay for things like new equipment and utility upgrades. Funds from the Nebraska program could also be used to explore new business models like purchasing cooperatives. This is something Liz Ravenscroft says she wants to explore if the grant program gets off the ground.
Liz Ravenscroft:The problem with our remote location is we are unable to sell a minimum amount that certain companies require for groceries.
Rachel Kramer:She manages Circle C Market, a nonprofit grocery store affiliated with a school in Cody, Nebraska. Population, one seventy. Ravenscroft says some of their customers come from an hour away to buy milk, bread, and other essentials. By creating a purchasing cooperative with other retailers in North Central Nebraska, Ravenscroft says they could order directly from a wholesaler and pass savings on to customers.
Liz Ravenscroft:You know, we're always looking for ways to get groceries at a more affordable cost for our customers. That's the bottom line.
Rachel Kramer:Ravenscroft, also a full time business teacher, says managing Circle C Market requires a lot of time, but it's a labor of love. She wants to support her community. In the break room at Woods Supermarket and Deli in Pocahontas, Kent and Kim Woods say the same thing. Many of their customers are people they've known for decades. When one had a health issue recently, they helped out by delivering her groceries.
Kim Wood:I mean, that's what you do in a small town. You look out for each other. No.
Rachel Kramer:Rural advocates in Iowa and Nebraska say it makes sense for states to look after small town grocers in return. I'm Rachel Kramer, Harvest Public Media.
Todd Gleason:Harvest Public Media is a collaboration of public media newsrooms in the Midwest and Great Plains. Let's check the global growing regions to see how the weather is impacting crops in them. We're now joined by Drew Lerner. He's at World Weather Incorporated in Kansas City. Hi, Drew.
Todd Gleason:Thank you so much for being with us today. However, you're in Canada again today?
Drew Lerner:I am. I'm a long way from US. I'm in a place called Grand Prairie, Alberta, which is along the British Columbia border with Alberta, and it's about a couple hours north of The US border. So it's about as far away from you as that we've been in a while.
Todd Gleason:Are you in canola or soybean country there?
Drew Lerner:This is canola country.
Todd Gleason:Yeah. So so they probably have been talking about tariffs because the Chinese just imposed tariffs. That will be problematic for them. I want you to focus not on that part, but on the weather. They have had dry conditions there, over the past couple of years.
Todd Gleason:Maybe reframe that slightly for me and then build that into what you see in the Western Part of The United States, particularly the Corn Belt for the coming season.
Drew Lerner:Yeah. Well, up in Canada, you're right. There has been a multiple a multiyear drought that has impacted production. They they seem to have done relatively well. Probably out of the last four or five years, they've had two bad years because of the drought, but they've managed to eke out a crop.
Drew Lerner:Just like our farmers, they can do miracles up there when the when they when they're up against the fence like this. So the you're right about the tariffs, and they're they're very concerned about that. The price of canola has fallen out of bed here recently because of the Chinese tariffs. And, so there's a lot of nervousness up there, but everybody says they're gonna stick pretty close to what their, planting rotations are, just because they have to rotate around in order to protect their soils and whatnot. So it sounds like it's gonna be status quo, but we're very concerned about the prices, of course, that they're gonna get, and, their expenses are going through the roof, because of all that's going on.
Drew Lerner:Now the dryness has been ongoing in Western Canada that may be breaking down in this growing season ahead, and so might it be in the Western Part Of The United States. I'm talking now the Far Western States. In the Midwest, the key corn and soybean producing areas, you know, we've got a lot of dryness that's still hanging on in the Great Plains and parts of the Upper Midwest portions of the Western Corn Belt. We've had a little bit of timely relief, but it hasn't really soaked down deep in the ground. And all we need here is about a week or ten days of really warm, dry weather, talking about April or May type weather where we get the seventies and even some eighties without any rain.
Drew Lerner:And dryness is gonna come to the topsoil very, very quickly. And so I don't think we wanna turn our backs on that. The upper air wind flow pattern right now is not supporting any big storm system coming in, that would soak down the plains or the western fringes of the Corn Belt. Little systems, yes. But big systems, probably not.
Drew Lerner:Now we do have one storm system coming up here in the next couple of days. It'd be pretty impressive. Wind blower for the hard red winter wheat country. We probably see 60 to 80 mile an hour winds in some places there. But if the humidity is gonna be 10 to 25%, that's not gonna do that crop any good.
Drew Lerner:And temperatures have been in the seventies and eighties the past couple of days. They'll fall back into the twenties briefly over the weekend and then back into the seventies and eighties next week. So that's not real good for a crop that's already been beat up by, January freezes without snow on the ground. You get a little bit more into corn and soybean country, and some of that dryness is definitely out there. We still have, moisture deficits in Iowa and parts of Minnesota and, certainly neighboring areas in the Dakotas.
Drew Lerner:There'll be a blizzard in the Eastern Dakotas and Minnesota on Friday into Saturday. It'll help a little bit, but, it's not it's not a fix all. So we're gonna continue watching everything that's going on in The states. The Eastern Midwest will stay plenty wet, especially the Tennessee River Basin area up into Ohio and Indiana. We're expecting a lot of wild weather there, a lot of rain, and some severe thunderstorms coming up here Friday into Saturday.
Todd Gleason:Turn your attention to South America begin in Brazil with the second crop or safrinha corn and prospects for it.
Drew Lerner:Well, Montagrasso is, the number one corn for, safrinha corn producing state in Brazil, and they did report on, March 9 that they had 7% of their crops still left to be put into the ground. And I'm still looking at 20 to 25% of the of the overall safrinha corn crop. It got planted quite late. And at the moment, everything's fine in Brazil. The moisture profile in Mato Grosso and neighboring states to the south is really favorably rated.
Drew Lerner:We're a little dry when you get down into Paranal and parts of, Sao Paulo, but I think those areas will get some timely rain in the next couple of weeks, and then they're gonna see some really normalish, weather conditions for corn development. But Mato Grosso will continue to be favorably moist. The monsoon doesn't end until we get to mid April in most years, and, producers are just hoping that it continues to rain fairly frequently. Even if they don't get that last little percentage of corn planted, they're more concerned about running out of moisture and the monsoon ending too soon, and they're worried about the what's left to be planted. It's imperative that they keep that moisture profile pretty darn full, as we get to the end of the monsoon season because this crop that was planted late will be dependent upon that subsoil moisture to carry that through reproduction, which for this late crop, it's gonna be May and probably into early June when the crop is filling.
Drew Lerner:So, they're gonna need all the help that they can get. So I'm not ready to say they're gonna have a wonderful crop, but for the next few weeks, they're going to do alright. After that, it's gonna be up to the temperatures and what's left in the in the soil, moisture wise.
Todd Gleason:How are the full season corn and soybean crops in Argentina doing?
Natural Sound:Yeah. You know, they turned the corner here a few weeks ago, and it started raining fairly often. We saturated the soil in the past couple of weeks. And, but that was okay for late season crops. It did have a negative impact on sun seed quality in Argentina and, delays in harvest of that crop, but that's probably the only, negative impact.
Drew Lerner:Most of the late season crops were still in the very end of reproduction and filling when the rains came along, and it's probably helped the yields out a little bit. Now we're looking at a week's worth of dry weather and temperatures that are going to be mostly seasonable, and so it looks pretty good. I really don't see many problems in the near term in either Brazil or Argentina.
Todd Gleason:Hey. Thank you much. I appreciate it.
Drew Lerner:Yep. Have a great day.
Todd Gleason:You too. That's Drew Lerner. He is with World Weather Incorporated in Kansas City and joined us on this Wednesday edition of the Closing Market Report. I'm extension's Todd Gleason.