Mar 27 | Closing Market Report

- Mike Zuzolo, GlobalCommResearch.com
- High Priced NH3 Likely to Persist into the Fall
- Eric Snodgrass, NutrienAgSolutions.com

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Creators and Guests

Host

Todd E. Gleason🎙🇺🇸

University of Illinois

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

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Todd Gleason: From the land-grant university in Urbana-Champaign, Illinois, this is the closing market report. It is the 27th day of March 2026. I'm Extension's Todd Gleason. Coming up, we'll talk about the commodity markets with Mike Zuzolo and the weather forecast with Eric Snodgrass. Along the way, we'll explore yesterday's webinar from the farmdoc team and their expectations for the price of anhydrous ammonia this fall. If you can stay with us for the whole hour today, you'll hear all of our Commodity Week program too. If not, you'll hear a portion of it, and the rest of it you can hear over the weekend on many of these stations or up online right now at willag.org. Todd Gleason's services are made available to WILL by University of Illinois Extension.

May corn for the day settled at $4.62. It was down 5 cents. July at $4.73 1/2, 4 1/2 lower, and December new crop down 4 1/4. Settlement price there at $4.90 1/4. May beans $11.59 1/4, 14 1/2 lower. July down 14 1/4 at $11.75 1/4. And November soybeans at $11.44, down 8 3/4 of a cent. Bean meal $6.80 lower. The bean oil down 61 cents. Wheat futures in the soft red unchanged at $6.05 for the July. The hard red at $6.47 1/2, up 6 1/4 cents. All on this Friday afternoon.

**01:30 Ag Markets with Mike Zuzolo**

Todd Gleason: Mike Zuzolo, GlobalCommResearch.com out of Atchison, Kansas, now joins us to take a look at the marketplace. Hi, Mike. Thanks much for being with us on a Friday. A lot of expectations for this Friday including SREs and RVOs. They came through in a big way but the market didn't seem to care. Can you tell me about what the expectations were, what actually came out, and how the market reacted?

Mike Zuzolo: Yeah, I mean the expectation I think Todd for both 2026 and 2027 biofuel obligations from EPA were around 24 to 24.5 billion RINs. EPA came out with 26.8 for 2026 and 27.02 for 2027. So about roughly 2 billion more for each year. I think the biggest thing that I saw that was price-friendly the market was the total mandates would include a 70% blending obligation. In other words, that small refinery exemption or waiver, I think we were thinking it was going to be 50%, but the EPA took it up to 70%, which the way I read that was and the way I read it is the large refineries are gonna have to add another 20%. They're not gonna be able to take that small refinery exemption. So I think I saw it the same way as the National Corn Growers saw it, the Clean Fuels Alliance saw it, the American Coalition for Ethanol. All of them came out with statements applauding this decision. Haven't seen anything from the American Soybean Association yet, but looked like to me a good EPA decision for the production side of the equation, increased production into domestic blending. And then the E15 waiver for summer blends, all of it very good news. Why did we make new lows heading into Friday after the news announcement? I guess I'm gonna chalk it up to the good old-fashioned buying the rumor and selling the fact.

Todd Gleason: So does that mean we'll start back up on Sunday evening into Monday, if nothing changes in the fundamentals over the weekend?

Mike Zuzolo: Yeah, I mean with crude oil back to around $99 a barrel, and I will say this Todd, I think that going into the weekend, we may have a lot of news to digest ahead of Monday's acreage and stocks report. So I'm going to say Friday's close meant next to nothing. The supply-demand numbers we got meant a lot, puts a lot more burden on the stocks report and the acreage reports as far as increased domestic demand, maybe takes some pressure off President Trump with his meeting in China. But when it comes to the energy side of the equation, the extension given to Iran from Friday to another 10 days for him to increase and escalate the conflict, I think the trade took that very seriously as Iran is now setting the pace of the war and that it adds to the questions about the United States and Israel's goals and whether they match up. And I say that because we saw the crude oil really take off and the stock market really get hammered on Friday. So I think I'm leaning towards this is still early days and there's more upside in the grains than downside given the energy markets.

Todd Gleason: You mentioned the prospective plantings and the grain stocks figures. Those are due out Tuesday at 11 o'clock next week. What are your expectations at this point?

Mike Zuzolo: Well, I'm still light on corn. I, you know, 9 billion bushels is the expectation, a little bit over for the average trade guess. The lowest number is 8.42. I would probably be down in that area because I just don't think we had as big a yield and we have more demand than what USDA is giving us right now. So that's where the quarterly grain stocks come into play. I would say the quarterly grain stocks and the acreage for corn, if they both come in tighter on supply, it really adds to the idea that we're done selling corn out in the farm country because we're planting now. And so that means the corn maybe has a bit more upside potential to it than maybe the trade's giving it for right now. My acreage base is still 93.5 on corn and 87 on beans. I'm out of the highest trade guess for the news wires, and that's just because of rotation and because of the higher levels of crop insurance. So that's kind of how I'm playing it.

Todd Gleason: Alright, well, it'll be interesting to see how that plays out. Those numbers are due out again at 11 AM Central Time on Tuesday. I won't get a chance to talk with you again next Friday because it is Good Friday and the markets are closed. Fortunately, you'll be joining us for Commodity Week and we'll take up all those numbers and everything that takes place in Iran and the rest of the world. Anything else you've been watching at this time that we ought to pay attention to, whether it's in South America or some place else?

Mike Zuzolo: Yeah, the one thing we didn't touch on, Todd, that we really need to, and this goes back to the crude oil market and the wheat relationship. It's diverged a little bit. It came back together at the end of this week. Winter wheat drought, cattle drought, both at 57% this week. They're both going up, conditions are going down. I think the wheat becomes a much more supportive feature unless we see a lot of rain as we get into the first or second week of April. So be watching for that as well.

Todd Gleason: Meteorologists have been warning us about that for a while, and it doesn't look like there's much in the offing for them, I think, at this point.

Mike Zuzolo: No, and we've got Texas and Oklahoma and Colorado and Kansas all falling, you know, Kansas lost 6%. That's our anchor right now on wheat conditions, and winter wheat's 57% versus 38% a year ago. So it's significant. I can tell you that.

Todd Gleason: We'll talk more about that later. Thanks much.

Mike Zuzolo: Thank you, Todd. Have a great weekend.

Todd Gleason: You too. That's Mike Zuzolo. He is at GlobalCommResearch.com, joined us here on the closing market report.

**07:18 High Priced NH3 Likely to Persist into the Fall**

Todd Gleason: You know, corn farmers have been fearful about the elevated price of fertilizers for a couple of years now. It's not a new thing exactly, but the war with Iran has made it front and center in Washington D.C. It was February of 2022 actually when Russia invaded Ukraine and the price of corn had been rallying for no real apparent reason since the previous fall. The futures markets were anticipating something that had not happened, and then on the 24th day of that month, tanks from Russia rolled into Ukraine and upended the global grain trade. Here's Washington D.C. based economist Gretchen Kuck from the National Corn Growers Association talking about that price difference.

Gretchen Kuck: You had asked me in February or December what, you know, one of my biggest concerns was for farmer profitability, I probably would have already told you fertilizer. This is not a new idea. This is not a new concept. As far back as September, we had a survey of growers saying up to 40% were planning to reduce fertilizer applications to weather some of these economic conditions.

Todd Gleason: Kuck made her comments during a recent University of Illinois webinar on the impact of the Iran war on fertilizer and fuel prices.

Gretchen Kuck: We already had a really interesting year in fertilizer markets leading up to this crisis. You had elevated high prices that we've had since 2020. You've had, we're heading into our fourth year of projected negative returns for corn growers, which makes it really hard to cash flow some of those increased, really high production costs. And you're having farmers having to make a lot of really tough decisions already. Maybe we're hoping for prices to come down and hadn't bought, but you've had US tariffs rerouting some supply chains, you've had restrictions from China on phosphate, you've had countervailing duties on phosphate. So it's been a really complicated year already, and this is not really a new idea that farmers are concerned about high fertilizer prices.

Todd Gleason: Despite the war, corn prices have remained relatively low. That's forcing farmers to make difficult decisions about fertilizer applications and overall profitability. They could choose to cut back application rates, of course. Land-grant university scientists across the Midwest have built this calculation into the online nitrogen rate calculator at cornratecalc.org. It optimizes the amount of nitrogen to apply, including all sources: MAP, DAP, 28, urea, and ammonia combined. Still, this doesn't really resolve the issue; it just softens the blow, say agricultural economists from the University of Illinois. Nick Paulson and Gary Schnitkey were leading the webinar in which Gretchen Kuck made her comments. It's online, by the way, at youtube.com/@farmdoc. Here the two are, starting with Paulson, explaining the increasing price of anhydrous ammonia in Illinois since the beginning of the current conflict.

Nick Paulson: Just as a comparison because we were able to update this through yesterday, March 25th, we do see again increases relative to the start of the conflict, on the order of about 15% if we're looking at Corn Belt locations for anhydrous ammonia prices. A higher relative increase in the Middle East, closer to a 20% increase, over that time frame from pre-conflict on Friday, February 27th, to yesterday, Wednesday, March 25th.

Gary Schnitkey: Just a couple other notes here. Nitrogen prices or anhydrous ammonia were edging up before the conflict. So we saw those rising. And we still, fortunately, aren't at those $1,200 level like the previous conflict. And by the way, the previous conflict, we were seeing nitrogen prices rise because of Hurricane Ida well before the Ukraine-Russia event happened.

Todd Gleason: Schnitkey has been working on and using a simple anhydrous ammonia price forecasting model for a few years. Generally, when prices spike, it shows these persist for some time. Right now, even if the conflict in Iran were to be settled, it suggests, while there are profitability issues today with the 2026 corn crop, it's likely to be more of a problem in 2027. That, says Nick Paulson, is because the model shows an $860 per ton average anhydrous ammonia price this fall in Illinois.

Nick Paulson: And that $860 number forecast that you see there, I think we talk about that in the article, you know, I don't want to say that's a best-case scenario, but I think there's even a pretty good chance that we'd see premiums above that, just given kind of what we saw in really the two years following that Russia-Ukraine crisis. We did see some premiums above what you would maybe expect given where corn and natural gas prices were, which is kind of what this model uses to forecast premiums above kind of those maybe fundamental levels that extended into the fall of 2022 and again into the fall of '23. You can see those labeled on the screen there. So close to $1,400 in '22, $800 in '23, and so we could expect, you know, easily I think, potentially $1,000 anhydrous prices in the fall, particularly if the conflict continues.

Gary Schnitkey: No, just that that's going to make a difficult decision environment because many farmers often price their ingredients then. And we'll see where prices are at that point in time, but, you know, a continuation of current prices would make the economics of growing corn, in particular, a bit more difficult.

Todd Gleason: Again, that last voice was Gary Schnitkey. It was preceded by his University of Illinois agricultural economics colleague Nick Paulson. The two were joined by a series of experts, including Gretchen Kuck from the National Corn Growers Association, for a webinar you may find and watch right now on YouTube at youtube.com/@farmdoc, or on our website at willag.org.

**15:35 Ag Weather with Eric Snodgrass**

Todd Gleason: Eric Snodgrass from Nutrien Ag Solutions and Agrible has been traveling for the last 24 hours, but he's nearing home now. Eric, thank you. I know you've had a difficult 24 hours in flight time because of the storms. We'll talk about that in just a bit. However, you were telling me about something you and a colleague have developed called the Elvis rule. It relates to the questions that you keep being asked by producers because there's so much drought in the West and it appears so much like 2012, they want to know if it is.

Eric Snodgrass: Yeah, I mean, so you're right. When you look at the Western Corn Belt, you look at the Southern Plains, we've got an extremely dry March that unfolded after an overwinter drought in the area. There's been numerous fires; we've seen them in the news, we've watched them in the weather, and even today they're under red flag warnings for high winds and more fire danger. So at the last two events I did this week, which yes, the storms last night cost me an extra 12 hours sleeping at airports, which is why I'm just now getting home midday today. The only thing good by the way in all of this, Todd, is the Illini won. So I was in high spirits the entire time. But this Elvis rule, we should talk about it. So here it is. Okay, we have 75% of the country in some form of drought, right? Some stage of drought. And I got asked, 'Hey, how does this compare to '12?' We do this every spring. And I'm saying it doesn't compare at all. We actually had much less drought in spring of 2012 than we do in 2026. And people are like, 'Well, what does that mean? Are we, are we in for it?' I said, 'No, because of what April and May rain can do.' And I said, 'Now listen, if you're in the Midwest, which you and I certainly are in the bullseye of that,' I said, 'You have to apply the Elvis rule.' And everyone's like, 'The Elvis rule?' I said, 'Yeah, Elvis Presley.' I said, 'If I live in Iowa, Illinois, or Indiana, I'm going to watch Memphis. I'm going to watch Graceland. I'm going to watch on one side of it over to Little Rock and the other side of it over to Nashville. And in every big, big drought that robbed us of yield in June and July, there was already drought in Graceland.' So that's our source area of really dry air in June and July. Now this doesn't apply after that, so you can't use it for August and September and beyond. But I said, 'If in April and in May, we do not recover moisture in the Mid-South, then the risk is on for June and July.' And if you go back and look at 2012, which is what the comparison questions are all about, I mean, it was a massive statistical outlier with how dry it was over where we have now the Elvis rule. So, Todd, for the next five, six weeks, we're going to bring up Elvis in every single one of our talks because it will just be a question as to whether or not they break away and get the moisture and relieve us of the worry of drought. And by the way, what is the worry? Our drought risk increases three times, so a 3x risk on drought, if we get the Mid-South very dry in April and May. So I'm talking again about June and July, the two following months.

Todd Gleason: It's not very far away. So what do you see for that area?

Eric Snodgrass: I see it wet. So the Elvis rule is going in the other direction. And that's why I'm saying the 2012 comparison right now is probably not the most wise year to compare against. And on top of that, the other part of this, which you and I have talked about for years, Todd, is that in 2012, already in early March, or end of March excuse me, the amount of cold water that was in the Gulf of Alaska and off the West Coast, I mean, it was everywhere. We just don't have that this year. In fact, we're watching a big El Niño build versus seeing colder water develop off of those West Coasts of North America regions. So I do see this: we've got a pattern that's going to develop a trough in the West starting a Monday, Tuesday of next week. It'll dig into the Central Plains mid-week next week, and it's going to open up the Gulf and we're going to see multiple chances for more storms and more rain. And yes, the severe storms that have come through us already in Illinois, which by the way, Illinois is leading the statistics categories on severe wind, hail, and tornadoes so far this year. We've had a lot of severe weather. And last night added to it. In fact, big hail over in Urbana, just nearby us. But all of that has also brought in rain, and it's really revived the area, especially some of the topsoil with moisture. It's to our West that the big concerns remain, and I think April may not be as kind to pockets of Nebraska or Kansas or Colorado or the Panhandles, which means they're going to be desperate for May rains in that area to cure their drought situation.

Todd Gleason: Alright, well with that, we'll wrap it up. Thank you very much and we'll keep track of whether Elvis is in the building and we're partying in the rain in April, or not. How about that? We'll talk with you again next week.

Eric Snodgrass: Sounds good. I'm a big Elvis fan, so I'm all for this.

Todd Gleason: That is Eric Snodgrass. He is with Nutrien Ag Solutions and Agrible, helped us to wrap up this Friday edition of the closing market report.