July 21, 2025 • 23 mins
- Curt Kimmel, AgMarket.net
- Ben Brown, University of Missouri
- U.S. Secretary of Commerce Lutnick
- Mark Russo, EverStream.ai
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Todd Gleason (00:00):
From the land to Grant University in Urbana
(00:02):
Champaign, Illinois. This is theclosing market report. It is the
July. I'm extension's ToddGleason. Coming up, we'll talk
about the commodity markets withKurt Kimmel.
He's at agmarket dot net. We'lllook at international trade and
exports, particularly for corn,with Ben Brown at the University
(00:23):
of Missouri, agriculturaleconomist there and a member of
the Food and Agricultural PolicyResearch Institute. And then
we'll turn our attention towhat, the Commerce Secretary had
to say during the Sunday morningshows. We'll have a couple sound
bites from Howard Lutnick andthose will relate to what Ben
Brown has to say about trade.And as we close out our time
(00:43):
together, we'll discuss theweather forecast too.
We'll do that with Mark Russo ofAverstream Analytics on this
Monday edition of the closingmarket report from Illinois
Public Media. It is public radiofor the farming world. Just a
quick note that Wednesday ofthis week, I'll be out of the
office. We'll hear an excerptthat day of the one big
(01:06):
beautiful bill act and itsimpact on commodity programs and
crop insurance webinar hosted bythe PharmDoc team last week. You
won't want to miss it.
It'll be just about twentyminutes, the last portion of
that webinar that summarizes thechanges and the impact it is
(01:26):
likely to have on agriculture.That's Wednesday afternoon
during the closing market reporthere on Illinois Public Media.
Todd Gleason services are madeavailable to WILL by University
of Illinois Extension. Septembercorn today at four zero three
and three quarters, down fourand three quarters. December at
four twenty two and a quarter,five and a half lower, and the
(01:47):
March down a nickel at $4.39 andthree quarters.
August soybeans, $10.15, twelveand three quarters lower.
September, ten ten and a half,down 10 and a half cents.
November, down nine and threequarters at $10.26. Bean meal
futures, $3.50 lower. The beanoil, up 25¢.
Soft red winter wheat, down 4¢,and the nearby September, also
(02:09):
three and three quarters lowerin the December. It settled at
$5.63 and a quarter, and thehard red December at $5.48 and a
quarter, down three and aquarter cents. Live cattle
futures, a buck 80 higher.Feeder cattle, up $3.60, and
lean hogs, 35¢ higher on theirsettlement price for the day.
Crude oil about $65.89 a barrel,17¢ lower, diesel fuel 4¢ higher
(02:33):
at $2.47 and 3 tenths, and thewholesale price of gasoline
about 2 and a quarter centshigher at $2.09 and 2 tenths of
a cent.
We're now joined by Kurt Kimmel.He's at agmarket.net to discuss
what's happening in themarketplace. Thank you, Kurt,
for being with us. Give me yourquick overview of the trade
since it started last night.
Curt Kimmel (02:54):
Oh, boy. We kinda just started a little lower,
tried to trade a littleunchanged. It just kinda eroded
from there. Most of the oldtrade or or producer side, to
get the market to go up to makesome sales higher. You know,
we're talking tar spot, aphids,some pollination issues in some
(03:19):
of these, varieties or hybrids,and, you know, tight tassel wrap
and too much flooding in someareas and other areas missing
out in the rain, but the treejust kinda is putting that in
the back burner here saying, youknow, some of these items are
kinda isolated or or notwidespread.
(03:40):
And we're just looking at thecrop conditions report in
general. This afternoon, they'relooking at corn conditions as a
nation being unchanged, 74% goodto excellent. Soybeans are
expected to be 71% good toexcellent versus 70% last week.
I don't know if I quite agreewith that. Beans don't like wet
(04:03):
feet.
There's some areas where it'sstarting to show, with, too much
rain, particularly on thesouthern third of, Illinois and
through here, were some areas,spots that recorded up to seven
inches of rain here over theweekend. So that's kind of the,
last thing they needed to seethere. So we'll see what the,
(04:26):
crop conditions report showshere, this afternoon and and
kind of what areas are stillhanging in there, what areas are
struggling Todd.
Todd Gleason (04:35):
You missed one new item that may impact the
marketplace, that's southernrust of corn. You can read more
about that on our website atwillag.org. Do you think today
was simply some profit takingafter last week's moves higher?
Curt Kimmel (04:52):
Well, you know, lot of that strength was, due to the
heat coming in this week, but,ideas are we've received some
moisture here to work with, theheat dome flattening or moving
back to the Southwest ingeneral. From a technical point
of view, looking at the charts,the market moved up into the gap
(05:16):
areas we left right after theJuly 4. There were some
downtrend lines, particularly inbeans, the market touched and
was unable to move up through.Corn moved up close to its gap
area, there's some retracementlevels there. So that coupled
with the fundamental news, themarket, backed and filled in
(05:38):
through here I believe, thecommodity funds sold 3,700 corn
contracts, 4,300 beans, and somemeal and oil.
Not a huge amount, but thebuying interest was just not
there. Going up there andfailing suggests we could maybe
cool down here for a day or two.Last week's technical action was
(05:59):
pretty good, so fairly goodsupport at last week's low, but
we don't want to go back down tothose lower levels. What to look
for now on a pullback on theDecember corn futures is 4.183
quarters is halfway back down tolast week's low. Today's low
here on Monday was 4.2 and onthe soybeans we had a low of
(06:23):
ten, twenty and a half, ten,twenty and three quarters is 50%
back down to last week's low.
So it's gonna be kind ofimportant to hold today's lows
in through here and see if wecan achieve or see a turnaround
Tuesday tomorrow time.
Todd Gleason (06:39):
We'll be watching for that turnaround Tuesday. If
we are unable to maintain thoseretracement levels and futures
just simply decide to pushlower, where does the tripwire
come into place? It is, I assumethe contract lows certainly for
to crop corn.
Curt Kimmel (06:58):
Correct. The main area everybody's going to watch
is last week's lows. Failure tohold that would open the door to
drift another 15 to 20¢ lower,from there. So we're kind of in
a downward momentum in here. Solast week's lows is gonna be the
kind of the key support.
(07:19):
When you go back in history andnot saying we're going to turn
around and go sharply higherfrom here, oftentimes we see
some seasonal lows occur here inlate August, September 1. Now
that's a ways away yet, so themarket could still, you know, be
kind of in a struggle mode herefor a while. But, once we get
(07:40):
larger crop priced into themarket and once we get,
particularly August 1 to see howthis tariff news unfolds, the
market could be maybe in aposition here to have a
different look than it has now.
Todd Gleason (07:53):
How much old crop corn and or soybeans,
particularly corn, do you thinkis still left to go to market
and how much of an impact and orweight could it have on the
marketplace as we move throughthe July, into August, and
September?
Curt Kimmel (08:07):
Well, that's a good question because, basically, we
do receive those calls every nowand then. I, you know, dropped
the ball. Was drinking thedrought Kool Aid like I did
myself here, thought we'd have alittle bit more up. But there
are some isolated cases, guysneed to move some old corn and
particularly the thing to do isto kind of monitor where you're
(08:31):
at and what offers are outthere. On our commercial side of
the equation, most end users aredown to just needing to secure
about ten to fifteen days to getthem into the harvest in here.
So it's kind of cat and mouse,it's a type of situation where a
big up from a smaller supply isnot going to really help here
(08:55):
here right now. It's just amatter of somebody needs some
grain here to give them toharvest.
Todd Gleason (08:59):
Hey, thanks much. I appreciate it.
Curt Kimmel (09:01):
You bet. Take care, Todd.
Todd Gleason (09:02):
You too. Kurt Kimmel is with agmarket.net. I'm
University of IllinoisExtension's Todd Gleason. Ben
(09:25):
Brown is now here, agriculturaleconomist with Extension and the
Food and Agricultural PolicyResearch Institute at the
University of Missouri inColumbia. Thank you for taking
some time with us.
What, have you been keeping aneye on in the way of numbers
that we should know about thisweek?
Ben Brown (09:41):
We're still in the growing season, so a lot of
people are focused on, you know,pollination and production. And
and, you know, the the heatthat's expected this week is is
kind of been driving someexpectations here the last
couple days. A lot of ourcommodity markets finished
higher on the week last, lastFriday. Starting off on a little
bit of a bearish tint here thisweek just because there's been
(10:03):
some rains pop up, to kinda helpalleviate some of the heat. But,
you know, domestic productioncontinues to remain in the
forefront.
I will say that I've beenworking and following the export
market quite a bit because cornexports have really been, I'm
going use the word stellar herethis summer, very strong. In
(10:24):
fact, 2024 and 2025 is is aboutas strong of an export year as
we could have asked for. In alot of ways, was expected last
fall, especially in, October andSeptember when Mexico was buying
a lot of corn from The UnitedStates. I was asked, is this,
you know, just them trying tojump the market to get ahead of
any potential tariffs? And myresponse then and remains the
same now is they need corn.
(10:46):
They it was very dry in Mexico.They needed corn. And The US is
just such a dominant market intothe Mexican or, you know, we're
a dominant supplier into theMexican market, because of our
our geographical proximity andand the way we built our
infrastructure in rail. And socorn exports have just remained
relatively strong, drivenlargely by Mexico and and a lot
of our other prime buyers,Japan, Colombia, Korea, all of
(11:12):
those have been extremelystrong. So I found interesting
that for the month of June wehad a stellar export program
both in terms of salesinspections and the market just
kept drifting lower, as as theprospects of a domestic crop
continued to increase.
However, you know, the demandwas really strong. Now we're
(11:32):
kind of entering into a periodof July where our export
inspections are starting toreally slow down on corn and yet
the market is trying to move alittle higher. So it just
emphasizes those those domesticexpectations really move the
market even though we have, youknow, or at least to this point,
we've had relatively strongunderlying demand. So that's on
the corn market. I will say onthe soybean market, I continue
to look for signs that Chinacomes in and buy soybeans.
(11:55):
That's been the, you know, thethe, I guess, focus here the
last couple weeks because it wasabout this time last year that
they started buying, of course,then they ended up having, you
know, a pretty robust exportwindow for for US soybeans, but
certainly we'd like to see themcome in and make some some
purchases of US soybeans here inthe next couple weeks. And on
the wheat side, soft red winterwheat export inspections this
(12:17):
week were were very strong. Wedon't talk a lot about soft red
winter wheat, because there'sjust not as many growers
anymore, but for our soft redwinter wheat market, at least
according to my estimates, thiswas our second largest weekly
volume of any week of thecalendar year over the last five
years. Largest volume cominglast year in late July, early
(12:41):
August. So you know a verystrong week of soft red winter
wheat exports.
We have the soft red winterwheat and it looks like it's
going to be a really nice sizedUS winter wheat crop again. So
I, that's gonna continue to leadto to strong strong exports just
because we have the volume andproduct to to ship.
Todd Gleason (13:00):
In August 1, the tariff regime that the
president, expects to put inplace should go into place. The
commerce secretary yesterday onthe Sunday morning shows, Howard
Lutnick, said, yes. It will gointo place. He also made sure
that we understood that 10% wasa rate that will simply be in
(13:21):
place across everything thatcomes into The United States
regardless of the deals that arestruck. It's just that nations
which are have higher gaps mayhave higher rates.
The Chinese are the only place,that have imposed tariffs on
(13:41):
retaliatory tariffs on,agricultural products. Do you
think that will make anydifference going into the fall
that those are already in placeand will stay there?
Ben Brown (13:53):
Trade is a really hard topic, to kind of, you
know, at least grasp goingforward. And and I'll tell you
the reason why I think it's hardis because of the likelihood or
at least the trajectory ofpurchase agreements. This is
something that's becoming acommon theme in in trade
negotiations here. The lastcouple weeks, we saw it with
Indonesia. We saw it with theagreement with Bangladesh.
(14:17):
There is, you know, an emphasis,it seems, by US trade
negotiators to work in some typeof purchase agreement
commitments. Very similar towhat we saw in the phase phase
one trade deal with China, youknow, what was that, five years
ago. You know, the commitment tosay, you know, they'll come into
the market and they'll buy, youknow, a set amount of product
above what the market wouldjustify given prices. And so,
(14:39):
you know, if those continue tohappen, you know, when they're
announced, it could move themarkets pretty pretty quickly.
And and so that's why I sit hereand say, you know, economics is
based on the principle of of allelse equal or said it said it's
Paris.
You'll hear that a lot. All elseequal and marginal change. And
(14:59):
and I don't think anything thatwe're dealing with in the trade
space right now meets those twoassumptions. There's a lot of
things changing all at once, soit's not marginal change, and
then everything else is notbeing held constant. And so I
it's it's this era to where ifprices increase to a buyer, we
would assume that they would buyless.
(15:20):
However, in the face or, youknow, in the inclusion of
purchase agreements, you couldend up in a scenario to where,
you know, commodities might behigher priced and people
actually consume more. Right? Itwould be the same as me going to
to the grocery store. I loveOreos and Oreos going to $8 and
I'm being like, yeah, I wasgonna buy one package at $4, now
I'm gonna buy two packages at$8. Right?
That's what's making the currenttrade discussion rather
(15:42):
difficult is this notion andthis theme that we're seeing
kind of play out of purchaseagreements. Not saying that
that's not the trajectory to goforward, it's not my decision to
make in that case. It just itmakes figuring out what to do,
just kinda difficult.
Todd Gleason (15:58):
So Hey. Thanks much, Ben. I appreciate it.
Ben Brown (16:00):
Yep. Appreciate it.
Todd Gleason (16:01):
Ben Brown is an agricultural economist. He's
located at the UniversityMissouri in Columbia where he is
with the Food and AgriculturalPolicy Research Institute and U
of M Extension. Now we mentionedHoward Lutnick who is the
secretary of commerce for theTrump administration. He was on
the Sunday shows with Face theNation. I picked up a couple of
(16:24):
sound bites for that.
Illustrate just exactly what heand the administration are
thinking about as it's relatedto tariffs that will be put into
place on August 1.
Howard Lutnick (16:37):
Oh, they're gonna love the deals that
president Trump and I are doing.I mean, they're just gonna love
them. You know, the presidentfigured out the right answer and
sent letters to these countries,said this is gonna fix the trade
deficit. This will go a long wayto fixing the trade deficit, and
that's gotten these countries tothe table. And they're gonna
open their markets or they'regoing to pay the tariff.
(17:00):
And if they open their markets,the opportunity for Americans
export, to grow their business,farmers, ranchers, fishermen.
This is going to be the next twoweeks are going to be weeks for
the record books. PresidentTrump is gonna deliver for the
American people.
Todd Gleason (17:16):
Let's put those comments from secretary Lutnick
into context with what BenBrown, ag economist from the
University of Missouri, justtold us about purchase
agreements. These are part ofthe trade agreements or at least
part of the framework of thetrade agreements that were put
in place for Indonesia andBangladesh. The trade agreements
(17:37):
outlined a wheat purchase bythose countries, but they're not
really obligated to do so,especially once the
administration's changed. That'swhat happened in the first Trump
administration once it wastransitioned to the Biden
administration and the purchaseagreements that China had with
(17:59):
The United States. It franklyonly honored about 75% of the
total purchase agreement ofagricultural products.
What we do know however for sureas it relates to all the trade
agreements from the secretary'scomments on Sunday is that the
10% base is in place and willstart and stay in place
(18:24):
indefinitely.
Howard Lutnick (18:25):
10% is definitely gonna stay. Many
countries will pay higher,higher, like Vietnam and
Indonesia. Right? They're 1920%.Most countries will pay higher.
The small countries are likelyto be 10%, but the bigger
countries are likely to payhigher. That's just the way it's
gonna be because we can't havethese $1,000,000,000,000 trade
(18:46):
deficit. It's just wrong forAmerica, and Donald Trump is
gonna fix it.
Todd Gleason (18:50):
If the fix includes a higher tariff rate,
it is very likely there will bea higher reciprocal tariff on
products imported into thosenations from The United States.
(19:19):
Let's check the weather forecastnow with Mark Russo. He's at
Everestream Analytics. Hello,Mark. Thank you for being with
us for the day.
Mark Russo (19:25):
Hey, Todd. Thanks for having me.
Todd Gleason (19:27):
Let's start with the heat that is moving into the
Midwest, a relatively cool andgray day here. A little humid
out, but not terrible, though.Things are supposed to get a lot
warmer. Can you give me someinstructions on what that might
look like?
Mark Russo (19:43):
Well, Todd, yeah, as we go through this week, we are
going to see some heat brieflybuild into the Midwest,
especially the middle portion ofthis week with high temperatures
climbing into the low to midnineties. The Far Southwest part
of the Midwest will have evenhotter temperatures. But for the
(20:03):
bulk of the Midwest, especiallythe key states of Illinois,
Iowa, Indiana, we do not see anylong duration heat. So for the
remainder of corn pollinationtaking place here the next week
or two, no significant heatstress is expected. For those
(20:24):
areas of the Far Southwest,centered in like it's again,
it's more so of the plains, but,you know, Kansas into portions
of Southern Nebraska and eveninto Missouri, there will be
some heat there.
So for any late pollinatingcorn, those crop areas will be
stressed here the next couple ofweeks.
Todd Gleason (20:46):
Largely, will there be rainfall attached to
this heat, or will it remain outof the picture?
Mark Russo (20:51):
Yes. It does look like there will be continued
opportunities for rain, again,especially across the heart of
the belt. This recent active orwet pattern looks to continue
during the next couple of weekswith rainfall registering normal
to even above normal. So rightnow, we do not see any extended
stretches of dry weather,especially in the core of the
(21:14):
Midwest.
Todd Gleason (21:15):
Sounds not bad for The United States, particularly
for the Corn Belt. They put alittle on the warm side. In
Europe, it's been hot. They havehad dry conditions. Are things
changing at all there?
Mark Russo (21:26):
Yeah. They are getting some relief in Europe.
We're seeing temperatures here,less of Europe, seeing
temperature less spatial extentof their ag belts seeing
significant heat. There is stillsome heat the next four to five
days in Southeastern Europe. Socountries like Romania,
Bulgaria, and Hungary will seesome heat.
But for the remainder of Europe,no significant heat is expected
(21:48):
the next couple of weeks. Andalong with that too, there will
continue to be opportunities forrain. We've seen an uptick in
rain activity recently thatlooks to continue for the next
two weeks. So overall, thepattern looks to basically
stabilize crops here and evencreate some improvement
following the heat and drynessto begin July.
Todd Gleason (22:08):
Thank you very much, Mark.
Mark Russo (22:09):
You're welcome, Todd.
Todd Gleason (22:10):
That's Mark Russo. He's with Everstream Analytics,
joined us on this Monday editionof the closing market report
from Illinois Public Media. Itis public radio for the farming
world. Just a quick reminderthat I will be out of the office
on Wednesday of this week, andwe'll bring you a special
program, an excerpt from lastTuesday's One Big Beautiful Bill
(22:30):
Act and its impact on commodityprograms and crop insurance
webinar. This will be thecondensed version, the last
portion of the program surmisingsome of the changes, and you'll
want to listen up if you've notalready watched that on YouTube.
You can watch that whole webinarif you'd like. It's easy enough
to get to. You can do that onYouTube, youtube.com/pharmdoc
(22:55):
and you'll find the webinarthere. But again, we'll have a
portion of it on Wednesday ofthis week during the closing
market report, which you've beenlistening to today on this
Monday afternoon. I'mextension's Todd Gleason.
From the land to Grant University in Urbana
(00:02):
Champaign, Illinois. This is theclosing market report. It is the
July. I'm extension's ToddGleason. Coming up, we'll talk
about the commodity markets withKurt Kimmel.
He's at agmarket dot net. We'lllook at international trade and
exports, particularly for corn,with Ben Brown at the University
(00:23):
of Missouri, agriculturaleconomist there and a member of
the Food and Agricultural PolicyResearch Institute. And then
we'll turn our attention towhat, the Commerce Secretary had
to say during the Sunday morningshows. We'll have a couple sound
bites from Howard Lutnick andthose will relate to what Ben
Brown has to say about trade.And as we close out our time
(00:43):
together, we'll discuss theweather forecast too.
We'll do that with Mark Russo ofAverstream Analytics on this
Monday edition of the closingmarket report from Illinois
Public Media. It is public radiofor the farming world. Just a
quick note that Wednesday ofthis week, I'll be out of the
office. We'll hear an excerptthat day of the one big
(01:06):
beautiful bill act and itsimpact on commodity programs and
crop insurance webinar hosted bythe PharmDoc team last week. You
won't want to miss it.
It'll be just about twentyminutes, the last portion of
that webinar that summarizes thechanges and the impact it is
(01:26):
likely to have on agriculture.That's Wednesday afternoon
during the closing market reporthere on Illinois Public Media.
Todd Gleason services are madeavailable to WILL by University
of Illinois Extension. Septembercorn today at four zero three
and three quarters, down fourand three quarters. December at
four twenty two and a quarter,five and a half lower, and the
(01:47):
March down a nickel at $4.39 andthree quarters.
August soybeans, $10.15, twelveand three quarters lower.
September, ten ten and a half,down 10 and a half cents.
November, down nine and threequarters at $10.26. Bean meal
futures, $3.50 lower. The beanoil, up 25¢.
Soft red winter wheat, down 4¢,and the nearby September, also
(02:09):
three and three quarters lowerin the December. It settled at
$5.63 and a quarter, and thehard red December at $5.48 and a
quarter, down three and aquarter cents. Live cattle
futures, a buck 80 higher.Feeder cattle, up $3.60, and
lean hogs, 35¢ higher on theirsettlement price for the day.
Crude oil about $65.89 a barrel,17¢ lower, diesel fuel 4¢ higher
(02:33):
at $2.47 and 3 tenths, and thewholesale price of gasoline
about 2 and a quarter centshigher at $2.09 and 2 tenths of
a cent.
We're now joined by Kurt Kimmel.He's at agmarket.net to discuss
what's happening in themarketplace. Thank you, Kurt,
for being with us. Give me yourquick overview of the trade
since it started last night.
Curt Kimmel (02:54):
Oh, boy. We kinda just started a little lower,
tried to trade a littleunchanged. It just kinda eroded
from there. Most of the oldtrade or or producer side, to
get the market to go up to makesome sales higher. You know,
we're talking tar spot, aphids,some pollination issues in some
(03:19):
of these, varieties or hybrids,and, you know, tight tassel wrap
and too much flooding in someareas and other areas missing
out in the rain, but the treejust kinda is putting that in
the back burner here saying, youknow, some of these items are
kinda isolated or or notwidespread.
(03:40):
And we're just looking at thecrop conditions report in
general. This afternoon, they'relooking at corn conditions as a
nation being unchanged, 74% goodto excellent. Soybeans are
expected to be 71% good toexcellent versus 70% last week.
I don't know if I quite agreewith that. Beans don't like wet
(04:03):
feet.
There's some areas where it'sstarting to show, with, too much
rain, particularly on thesouthern third of, Illinois and
through here, were some areas,spots that recorded up to seven
inches of rain here over theweekend. So that's kind of the,
last thing they needed to seethere. So we'll see what the,
(04:26):
crop conditions report showshere, this afternoon and and
kind of what areas are stillhanging in there, what areas are
struggling Todd.
Todd Gleason (04:35):
You missed one new item that may impact the
marketplace, that's southernrust of corn. You can read more
about that on our website atwillag.org. Do you think today
was simply some profit takingafter last week's moves higher?
Curt Kimmel (04:52):
Well, you know, lot of that strength was, due to the
heat coming in this week, but,ideas are we've received some
moisture here to work with, theheat dome flattening or moving
back to the Southwest ingeneral. From a technical point
of view, looking at the charts,the market moved up into the gap
(05:16):
areas we left right after theJuly 4. There were some
downtrend lines, particularly inbeans, the market touched and
was unable to move up through.Corn moved up close to its gap
area, there's some retracementlevels there. So that coupled
with the fundamental news, themarket, backed and filled in
(05:38):
through here I believe, thecommodity funds sold 3,700 corn
contracts, 4,300 beans, and somemeal and oil.
Not a huge amount, but thebuying interest was just not
there. Going up there andfailing suggests we could maybe
cool down here for a day or two.Last week's technical action was
(05:59):
pretty good, so fairly goodsupport at last week's low, but
we don't want to go back down tothose lower levels. What to look
for now on a pullback on theDecember corn futures is 4.183
quarters is halfway back down tolast week's low. Today's low
here on Monday was 4.2 and onthe soybeans we had a low of
(06:23):
ten, twenty and a half, ten,twenty and three quarters is 50%
back down to last week's low.
So it's gonna be kind ofimportant to hold today's lows
in through here and see if wecan achieve or see a turnaround
Tuesday tomorrow time.
Todd Gleason (06:39):
We'll be watching for that turnaround Tuesday. If
we are unable to maintain thoseretracement levels and futures
just simply decide to pushlower, where does the tripwire
come into place? It is, I assumethe contract lows certainly for
to crop corn.
Curt Kimmel (06:58):
Correct. The main area everybody's going to watch
is last week's lows. Failure tohold that would open the door to
drift another 15 to 20¢ lower,from there. So we're kind of in
a downward momentum in here. Solast week's lows is gonna be the
kind of the key support.
(07:19):
When you go back in history andnot saying we're going to turn
around and go sharply higherfrom here, oftentimes we see
some seasonal lows occur here inlate August, September 1. Now
that's a ways away yet, so themarket could still, you know, be
kind of in a struggle mode herefor a while. But, once we get
(07:40):
larger crop priced into themarket and once we get,
particularly August 1 to see howthis tariff news unfolds, the
market could be maybe in aposition here to have a
different look than it has now.
Todd Gleason (07:53):
How much old crop corn and or soybeans,
particularly corn, do you thinkis still left to go to market
and how much of an impact and orweight could it have on the
marketplace as we move throughthe July, into August, and
September?
Curt Kimmel (08:07):
Well, that's a good question because, basically, we
do receive those calls every nowand then. I, you know, dropped
the ball. Was drinking thedrought Kool Aid like I did
myself here, thought we'd have alittle bit more up. But there
are some isolated cases, guysneed to move some old corn and
particularly the thing to do isto kind of monitor where you're
(08:31):
at and what offers are outthere. On our commercial side of
the equation, most end users aredown to just needing to secure
about ten to fifteen days to getthem into the harvest in here.
So it's kind of cat and mouse,it's a type of situation where a
big up from a smaller supply isnot going to really help here
(08:55):
here right now. It's just amatter of somebody needs some
grain here to give them toharvest.
Todd Gleason (08:59):
Hey, thanks much. I appreciate it.
Curt Kimmel (09:01):
You bet. Take care, Todd.
Todd Gleason (09:02):
You too. Kurt Kimmel is with agmarket.net. I'm
University of IllinoisExtension's Todd Gleason. Ben
(09:25):
Brown is now here, agriculturaleconomist with Extension and the
Food and Agricultural PolicyResearch Institute at the
University of Missouri inColumbia. Thank you for taking
some time with us.
What, have you been keeping aneye on in the way of numbers
that we should know about thisweek?
Ben Brown (09:41):
We're still in the growing season, so a lot of
people are focused on, you know,pollination and production. And
and, you know, the the heatthat's expected this week is is
kind of been driving someexpectations here the last
couple days. A lot of ourcommodity markets finished
higher on the week last, lastFriday. Starting off on a little
bit of a bearish tint here thisweek just because there's been
(10:03):
some rains pop up, to kinda helpalleviate some of the heat. But,
you know, domestic productioncontinues to remain in the
forefront.
I will say that I've beenworking and following the export
market quite a bit because cornexports have really been, I'm
going use the word stellar herethis summer, very strong. In
(10:24):
fact, 2024 and 2025 is is aboutas strong of an export year as
we could have asked for. In alot of ways, was expected last
fall, especially in, October andSeptember when Mexico was buying
a lot of corn from The UnitedStates. I was asked, is this,
you know, just them trying tojump the market to get ahead of
any potential tariffs? And myresponse then and remains the
same now is they need corn.
(10:46):
They it was very dry in Mexico.They needed corn. And The US is
just such a dominant market intothe Mexican or, you know, we're
a dominant supplier into theMexican market, because of our
our geographical proximity andand the way we built our
infrastructure in rail. And socorn exports have just remained
relatively strong, drivenlargely by Mexico and and a lot
of our other prime buyers,Japan, Colombia, Korea, all of
(11:12):
those have been extremelystrong. So I found interesting
that for the month of June wehad a stellar export program
both in terms of salesinspections and the market just
kept drifting lower, as as theprospects of a domestic crop
continued to increase.
However, you know, the demandwas really strong. Now we're
(11:32):
kind of entering into a periodof July where our export
inspections are starting toreally slow down on corn and yet
the market is trying to move alittle higher. So it just
emphasizes those those domesticexpectations really move the
market even though we have, youknow, or at least to this point,
we've had relatively strongunderlying demand. So that's on
the corn market. I will say onthe soybean market, I continue
to look for signs that Chinacomes in and buy soybeans.
(11:55):
That's been the, you know, thethe, I guess, focus here the
last couple weeks because it wasabout this time last year that
they started buying, of course,then they ended up having, you
know, a pretty robust exportwindow for for US soybeans, but
certainly we'd like to see themcome in and make some some
purchases of US soybeans here inthe next couple weeks. And on
the wheat side, soft red winterwheat export inspections this
(12:17):
week were were very strong. Wedon't talk a lot about soft red
winter wheat, because there'sjust not as many growers
anymore, but for our soft redwinter wheat market, at least
according to my estimates, thiswas our second largest weekly
volume of any week of thecalendar year over the last five
years. Largest volume cominglast year in late July, early
(12:41):
August. So you know a verystrong week of soft red winter
wheat exports.
We have the soft red winterwheat and it looks like it's
going to be a really nice sizedUS winter wheat crop again. So
I, that's gonna continue to leadto to strong strong exports just
because we have the volume andproduct to to ship.
Todd Gleason (13:00):
In August 1, the tariff regime that the
president, expects to put inplace should go into place. The
commerce secretary yesterday onthe Sunday morning shows, Howard
Lutnick, said, yes. It will gointo place. He also made sure
that we understood that 10% wasa rate that will simply be in
(13:21):
place across everything thatcomes into The United States
regardless of the deals that arestruck. It's just that nations
which are have higher gaps mayhave higher rates.
The Chinese are the only place,that have imposed tariffs on
(13:41):
retaliatory tariffs on,agricultural products. Do you
think that will make anydifference going into the fall
that those are already in placeand will stay there?
Ben Brown (13:53):
Trade is a really hard topic, to kind of, you
know, at least grasp goingforward. And and I'll tell you
the reason why I think it's hardis because of the likelihood or
at least the trajectory ofpurchase agreements. This is
something that's becoming acommon theme in in trade
negotiations here. The lastcouple weeks, we saw it with
Indonesia. We saw it with theagreement with Bangladesh.
(14:17):
There is, you know, an emphasis,it seems, by US trade
negotiators to work in some typeof purchase agreement
commitments. Very similar towhat we saw in the phase phase
one trade deal with China, youknow, what was that, five years
ago. You know, the commitment tosay, you know, they'll come into
the market and they'll buy, youknow, a set amount of product
above what the market wouldjustify given prices. And so,
(14:39):
you know, if those continue tohappen, you know, when they're
announced, it could move themarkets pretty pretty quickly.
And and so that's why I sit hereand say, you know, economics is
based on the principle of of allelse equal or said it said it's
Paris.
You'll hear that a lot. All elseequal and marginal change. And
(14:59):
and I don't think anything thatwe're dealing with in the trade
space right now meets those twoassumptions. There's a lot of
things changing all at once, soit's not marginal change, and
then everything else is notbeing held constant. And so I
it's it's this era to where ifprices increase to a buyer, we
would assume that they would buyless.
(15:20):
However, in the face or, youknow, in the inclusion of
purchase agreements, you couldend up in a scenario to where,
you know, commodities might behigher priced and people
actually consume more. Right? Itwould be the same as me going to
to the grocery store. I loveOreos and Oreos going to $8 and
I'm being like, yeah, I wasgonna buy one package at $4, now
I'm gonna buy two packages at$8. Right?
That's what's making the currenttrade discussion rather
(15:42):
difficult is this notion andthis theme that we're seeing
kind of play out of purchaseagreements. Not saying that
that's not the trajectory to goforward, it's not my decision to
make in that case. It just itmakes figuring out what to do,
just kinda difficult.
Todd Gleason (15:58):
So Hey. Thanks much, Ben. I appreciate it.
Ben Brown (16:00):
Yep. Appreciate it.
Todd Gleason (16:01):
Ben Brown is an agricultural economist. He's
located at the UniversityMissouri in Columbia where he is
with the Food and AgriculturalPolicy Research Institute and U
of M Extension. Now we mentionedHoward Lutnick who is the
secretary of commerce for theTrump administration. He was on
the Sunday shows with Face theNation. I picked up a couple of
(16:24):
sound bites for that.
Illustrate just exactly what heand the administration are
thinking about as it's relatedto tariffs that will be put into
place on August 1.
Howard Lutnick (16:37):
Oh, they're gonna love the deals that
president Trump and I are doing.I mean, they're just gonna love
them. You know, the presidentfigured out the right answer and
sent letters to these countries,said this is gonna fix the trade
deficit. This will go a long wayto fixing the trade deficit, and
that's gotten these countries tothe table. And they're gonna
open their markets or they'regoing to pay the tariff.
(17:00):
And if they open their markets,the opportunity for Americans
export, to grow their business,farmers, ranchers, fishermen.
This is going to be the next twoweeks are going to be weeks for
the record books. PresidentTrump is gonna deliver for the
American people.
Todd Gleason (17:16):
Let's put those comments from secretary Lutnick
into context with what BenBrown, ag economist from the
University of Missouri, justtold us about purchase
agreements. These are part ofthe trade agreements or at least
part of the framework of thetrade agreements that were put
in place for Indonesia andBangladesh. The trade agreements
(17:37):
outlined a wheat purchase bythose countries, but they're not
really obligated to do so,especially once the
administration's changed. That'swhat happened in the first Trump
administration once it wastransitioned to the Biden
administration and the purchaseagreements that China had with
(17:59):
The United States. It franklyonly honored about 75% of the
total purchase agreement ofagricultural products.
What we do know however for sureas it relates to all the trade
agreements from the secretary'scomments on Sunday is that the
10% base is in place and willstart and stay in place
(18:24):
indefinitely.
Howard Lutnick (18:25):
10% is definitely gonna stay. Many
countries will pay higher,higher, like Vietnam and
Indonesia. Right? They're 1920%.Most countries will pay higher.
The small countries are likelyto be 10%, but the bigger
countries are likely to payhigher. That's just the way it's
gonna be because we can't havethese $1,000,000,000,000 trade
(18:46):
deficit. It's just wrong forAmerica, and Donald Trump is
gonna fix it.
Todd Gleason (18:50):
If the fix includes a higher tariff rate,
it is very likely there will bea higher reciprocal tariff on
products imported into thosenations from The United States.
(19:19):
Let's check the weather forecastnow with Mark Russo. He's at
Everestream Analytics. Hello,Mark. Thank you for being with
us for the day.
Mark Russo (19:25):
Hey, Todd. Thanks for having me.
Todd Gleason (19:27):
Let's start with the heat that is moving into the
Midwest, a relatively cool andgray day here. A little humid
out, but not terrible, though.Things are supposed to get a lot
warmer. Can you give me someinstructions on what that might
look like?
Mark Russo (19:43):
Well, Todd, yeah, as we go through this week, we are
going to see some heat brieflybuild into the Midwest,
especially the middle portion ofthis week with high temperatures
climbing into the low to midnineties. The Far Southwest part
of the Midwest will have evenhotter temperatures. But for the
(20:03):
bulk of the Midwest, especiallythe key states of Illinois,
Iowa, Indiana, we do not see anylong duration heat. So for the
remainder of corn pollinationtaking place here the next week
or two, no significant heatstress is expected. For those
(20:24):
areas of the Far Southwest,centered in like it's again,
it's more so of the plains, but,you know, Kansas into portions
of Southern Nebraska and eveninto Missouri, there will be
some heat there.
So for any late pollinatingcorn, those crop areas will be
stressed here the next couple ofweeks.
Todd Gleason (20:46):
Largely, will there be rainfall attached to
this heat, or will it remain outof the picture?
Mark Russo (20:51):
Yes. It does look like there will be continued
opportunities for rain, again,especially across the heart of
the belt. This recent active orwet pattern looks to continue
during the next couple of weekswith rainfall registering normal
to even above normal. So rightnow, we do not see any extended
stretches of dry weather,especially in the core of the
(21:14):
Midwest.
Todd Gleason (21:15):
Sounds not bad for The United States, particularly
for the Corn Belt. They put alittle on the warm side. In
Europe, it's been hot. They havehad dry conditions. Are things
changing at all there?
Mark Russo (21:26):
Yeah. They are getting some relief in Europe.
We're seeing temperatures here,less of Europe, seeing
temperature less spatial extentof their ag belts seeing
significant heat. There is stillsome heat the next four to five
days in Southeastern Europe. Socountries like Romania,
Bulgaria, and Hungary will seesome heat.
But for the remainder of Europe,no significant heat is expected
(21:48):
the next couple of weeks. Andalong with that too, there will
continue to be opportunities forrain. We've seen an uptick in
rain activity recently thatlooks to continue for the next
two weeks. So overall, thepattern looks to basically
stabilize crops here and evencreate some improvement
following the heat and drynessto begin July.
Todd Gleason (22:08):
Thank you very much, Mark.
Mark Russo (22:09):
You're welcome, Todd.
Todd Gleason (22:10):
That's Mark Russo. He's with Everstream Analytics,
joined us on this Monday editionof the closing market report
from Illinois Public Media. Itis public radio for the farming
world. Just a quick reminderthat I will be out of the office
on Wednesday of this week, andwe'll bring you a special
program, an excerpt from lastTuesday's One Big Beautiful Bill
(22:30):
Act and its impact on commodityprograms and crop insurance
webinar. This will be thecondensed version, the last
portion of the program surmisingsome of the changes, and you'll
want to listen up if you've notalready watched that on YouTube.
You can watch that whole webinarif you'd like. It's easy enough
to get to. You can do that onYouTube, youtube.com/pharmdoc
(22:55):
and you'll find the webinarthere. But again, we'll have a
portion of it on Wednesday ofthis week during the closing
market report, which you've beenlistening to today on this
Monday afternoon. I'mextension's Todd Gleason.
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