May 29, 2025 • 32 mins
Panelists
- Alan Brugler, A&N Economics LLC
- Shane Holtorf, Logic Ag Marketing
- Chip Nellinger, Blue Reef Agri-Marketing
Mark as Played
Transcript
Episode Transcript
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Todd Gleason (00:00):
This is the May 29 edition of Commodity Week. Todd
Gleason services are madeavailable to WILL by University
of Illinois Extension. Well,welcome to commodity week. I am
Todd Gleason. Our panelists forthe day include Alan Brugler.
(00:20):
He's at A and N Economics out ofOmaha, Nebraska. We'll ask him
about that in a moment. ShaneHoltorf is here from Logic Ag
Marketing. He's in Alta, Iowa.And Chip Nellinger joins us from
Blue Reef Agrimarketing out ofMorton, Illinois.
Commodity Week is a productionof Illinois Public Media. This
is public radio for the farmingworld online, on demand anytime
(00:41):
you'd like to listen atwillag.0rg or in your favorite
podcast applications. AlanBrugler, let's begin with you.
Brugler marketing and managementstill exist, although I take it
about a year ago you steppedaway just a bit and operate more
at arm's length. Can you tell meabout this transition?
Alan Brugler (01:06):
Yeah. Basically, I turned 70 and maxed out my
Social Security and I said it'stime to get away from the day to
day operations. So I I sold theburglar operating rights, naming
rights, product names,subscriber base, all that to
Austin Schroeder. He'd been anemployee of mine for about eight
(01:26):
years and is very good atduplicating everything I I did.
I'm still affiliated withBrugler marketing.
You'll see it some places on theInternet. I write columns for
them occasionally, consult on onhedging positions and so forth
and do do speeches. But A and Neconomics is is the place to to
(01:48):
park money and and if somebodywants to reach me for a speech
or whatever. But I'm still stillinvolved in the markets, but,
more of an on arm's length and,more consulting base rather than
day to day advice.
Todd Gleason (02:01):
That may be good in this year, and
congratulations, by the way. Sowhat are the things that you're
watching most closely and thatwe should maybe talk about
today?
Alan Brugler (02:10):
Well, I I I think the tariff situation definitely
is is top of mind again withthat trade court ruling saying
that many of the Trump tariffsare illegal. I think that's a
very important shift here interms of it's not immediate
because there's going to be someappeals and so forth. But I
(02:31):
think it does change theleverage that the administration
has, and it does have someimplications for our commodity
marketing. You know, weather isanother one, I think, concerns
about too wet down south and anyprevent plant, that type of
thing.
Todd Gleason (02:46):
Shane Holtorf from Logic Ag Marketing. What's on
your mind that we should discussthis week?
Shane Holtorf (02:51):
Yeah. So, obviously, we, we saw the May
out, and, we tightenedeverything up a little bit. You
know, I don't I don't think wehave a lot of room for a mistake
throughout this year. You know,we've shrunk the global balance
sheet to the tightest it's beenon the corn side in over ten
years, and beans don't have alot of breathing room either. So
(03:14):
we're going to need to get offto a good start and keep our
foot on our gas growing thesegrowing these crops.
Todd Gleason (03:21):
And finally, Chip Nellinger of Blue Reef
AgriMarketing. Anything you'dlike to add before we get
started?
Chip Nellinger (03:26):
Yeah. I I think in addition to what was talked
about previously, one thing thatI'm watching pretty closely is
the soy oil market is lookingvery heavy right now. Really
disappointment with a lack ofclarity or any answers as it
relates to the biodieselsituation and what or what might
not be taking place on themandate side there. So the soil
(03:49):
oil market, if you overlay thatagainst the bean market, it's
been a pretty perfectcorrelation. And it looks to me
like the soil oil market has alot of fund links.
We stopped making higher highs.We're starting to violate some
of the key moving averages andthat market without clarity into
what the future demand may belooks a little potentially top
(04:10):
heavy to me.
Todd Gleason (04:10):
Let's start with trade and tariffs, Alan Brugler.
There were two courts actuallythis week, the Court of
International Trade and then asecond one that was dealing with
some toy companies that bothsaid the Trump administration's
use of a 1977 law was unlawfulin terms of imposing a tariff
(04:36):
that covered everything onLiberation Day, which was the
10% plus reciprocals, and italso backtracked to the Mexico
and Canada and China tariffsthat were imposed prior to that.
What issues do you expect themarketplace to have to deal
(04:56):
with, and what have you beenthinking about as it relates to
this particular subject matter?
Alan Brugler (05:02):
Well, obviously, that's been a key part of the
negotiating strategy for theadministration. They're trying
to raise revenue from thetariffs to help pay for some of
the other tax cuts. They'retrying to enforce some changes
in non trade behavior in some ofthese other countries,
intellectual property rights andthat sort of thing. So it's
(05:24):
definitely impaired that alittle bit because those
countries can say, well, wedon't know if you really have
the stick anymore that you'retrying to beat us with. No.
I do think that these rulingsare are not the be all and end
all. I think you're gonnaimmediately see the
administration appeal them.You're gonna go to a higher
court. It could eventually endup at the Supreme Court. The key
(05:49):
that I'm watching relative tothe to the tariff ruling is when
it goes to that through thatappeals process, does the next
court issue any kind of stay orinjunction?
Can the administration continueto implement the tariffs until
the appeals are done? Or do theyput a hold on them until the
appeal is process is done? Now,does it affect soybean exports
(06:14):
in the summer of twenty twentyfive? Probably not because
seasonally we don't do muchright here. I think you the big
issue though, is it does changethe leverage.
And I think you also have toremember that it does not affect
as you alluded to earlier, doesnot affect steel and aluminum.
(06:35):
Those were implemented under oneof the other laws and those
tariffs are still in place. So,you know, anything that's,
relying on imported steel pricesis still gonna be more
expensive.
Todd Gleason (06:45):
Let's stay with Washington DC, Shane Holtorf,
but we'll move to USDA and themonthly reports. What
expectations do you have when wetransition from the May WASDE to
the June World Ag Supply andDemand Estimates?
Shane Holtorf (07:03):
Sure. Well, we're certainly off to a blazing start
when you look at the planningprogress. You know, we've blown
the last five years out of thewater. On the corn planting
progress, you know, I'm fromNorthwest Iowa. And, you know,
when we talked last time, wewere off to a really quick
start, got off to an earlyfinish.
(07:24):
Things are looking great here,but I think Chip was the one
that alluded to, that may notall be rosy in other areas. And
so as you start to talk aboutthe potential for prevent plant,
are we going to see some acresthat we had originally thought
were going to corn because ofthe quick planting progress,
(07:46):
maybe not make its way to cornor find its way to beans? I've
also got a question, you know,as time starts to delay, what
happens to this, you know, 181bushel yield that we're, you
know, that we're starting outwith. And so if we, knock a
bushel or two here or there offof the corn balance sheet and
(08:08):
trim up those acres, we go froma very, very comfortable
position to maybe a little lesscomfort as we look at the
balance sheet. You know, on thebean side, you know, kind of the
same thing, but if if we see alittle acreage shift over to the
(08:28):
the bean side of the market, Youknow, we're we we've always just
kinda tow that line, right, on300,000,000 bushel carryout, and
I think that's that's kindawhere we're gonna be here.
And so, you know, I won't stealChip's Thunder, but I think a
lot has to do with on the beanside, more the SAF focal points
and what we're gonna do withsome of these rulings.
Todd Gleason (08:50):
We'll get to Chip in just a second. I do wanna ask
both you and Alan because you'rein that area, Northwest Iowa and
then West Central Iowa,speaking, as it relates to
Omaha, Nebraska. Did the cornplanters just continue to roll
there? And are do you both thinkthat at this point you're off to
(09:11):
such a good start that you havea really good chance at having
exceptional yields in thoseareas? So Shane, did the farmers
continue to plant corn, and isthe crop looking really good?
Shane Holtorf (09:24):
Yeah. So I would say, you know, based upon the
farmers that that we talkedwith, you know, there wasn't a
lot that that switched over tocontinue into that corn planting
side of things. You know, theremight have been a a 40 switch
tier and 80 there. You know? Butit seems by and large, by the
time the planters start to roll,the decisions gotta be made
(09:47):
because, you know, they've gottheir chemicals, you know, on
farm fertilizer being spread,and you don't wanna mess up the
ballet, so to speak.
And so what I I don't think wesaw as much switches, you know,
what we're originally thinkingor anticipating. But as far as
the crops being off to a reallygood start, you you can walk out
(10:09):
these fields and do a standcount, and everything that was
planted came up. You know, therewas a few guys that spiked in,
you know, one or two plant dateswhere they had a little issue
with emergence. But by andlarge, the emergence is great.
We've been getting some timelyrains.
We needed some heat. We neededsome sun. We're gonna get that
(10:30):
for the next four or five days,and then it's looking like it's
going to rain again. So thingshere are looking pretty good.
Todd Gleason (10:37):
And then, Alan, if you could follow-up because the
West Central Crop ReportingDistrict in Iowa is its largest
production district. What haveyou seen when you've been out
driving?
Alan Brugler (10:50):
Yeah, got a pretty good perspective of the whole
Corn Belt. As a week and a halfago, I drove from Ohio or Omaha
to Ohio, in fact. And, you know,in general, Nebraska and Iowa
looked great. Everything was in,everything was up pretty much on
the corn side. Beans were alittle further behind.
Obviously you got into Illinois,it had obviously just been
(11:12):
planted Indiana. They've donethe field work, but nothing was
up yet in Ohio. They werewaiting on it to dry out enough
to plant. And you saw that inthis week's planning progress
that Ohio's way behind alongwith some of the states to the
south where they've got someflooding issues. I will say that
the crop yield potential rightnow in the Western Corn Belt is
(11:35):
tremendous because we've gotexcellent stands here, right in
the Omaha and Western Iowa area.
We miss some of those rains thatthey got in the Northwest. Omaha
itself is two and a half inchesbelow normal for the month of
May with a couple of days lefthere. And I think about the same
for the year to date. So, youknow, a little more water in the
(11:58):
non irrigated areas would bevery welcome. We had some of the
Nebraska producers actually rantheir irrigation just to get
their germination where theywanted it.
They didn't want to keep doingthat. It's too early in the
season, but they had to justactivate the chemicals and get
the seed up. But yeah, thebiggest problem is problems that
(12:20):
I see in the Corn Belt aremostly Ohio and Indiana being
behind because it'd be in toowet. Then, you know, the smaller
acreage states in the Southcould lose a few corn acres to
beans. But because of that rapidplant progress, I'm also
concerned we might have pickedup a few extra acres in the
Western Hornbelt.
Todd Gleason (12:39):
And just, so that the numbers are there, you are
correct. It's about two and ahalf inches behind. For year to
date, I don't know about themonth of May, but since April 1,
only 3.51 inches of rainfall inOmaha, Nebraska. Those are
aggrable numbers. ChipNellinger, I wanna turn to you,
(13:02):
and ask about the Eastern CornBelt, what you're hearing as
it's related, and we just had afirsthand look at it with Alan,
but how far really are theybehind, and do you think the
prevent plant that might show upthere would be enough to offset
the really big numbers thatcould come out of Illinois and
(13:22):
Iowa?
Chip Nellinger (13:23):
Yeah, Todd, that's a loaded question. I
think it depends on where you'reat. I think a couple things are
at work here. As you get throughIllinois, Indiana, Illinois
especially, North of Interstate70, things are pretty good.
Things got in early.
South of there, it's been adisastrous spring, and I think
(13:44):
the market's somewhatoverlooking that. So there's
still areas that are finished upplanting. They're getting too
much rain. They're waiting onthings to dry out. As you get
into Kentucky and Tennessee,it's even more disastrous on
some of these acres.
There's been floods, in in someof the, you know, Mississippi
River bottom areas. So we talkedto producers there that have
(14:05):
really struggled to get stuff inthe ground. I think the early
planting, I think the market sawthe early planting pace and said
all things are perfect, thingsare great, we're going to get
this crop in the ground and it'sgoing to be awesome. And I would
argue that at least in Illinois,the northern two thirds of
Illinois, yeah, there might havebeen some early planting, but
then it got overcast, reallycool, little bit of rain, and
(14:29):
that seed just sat there. Andand even if it was a merge, we
just sat there and did nothing.
So I'd I'd argue, and I'm not anagronomist, this is just my
opinion, that we've kinda lost alot of benefit of that early
planting and things are, youknow, more of a normal planting
pace because they sat there forso long. So I I think there's a
lot of things that work there. II think also there's areas, the
old I I don't necessarily buythe old argument that early
(14:52):
planting and good planting leadsto more corn acres because so
many farmers now, especially thelast three years, start on
beans, right? And so at leastthrough the heart of the Corn
Belt, which is where some ofthose acres you would expect to
swing, farmers started on beans.And that's kind of the majority
(15:13):
in that area.
In fact, it's across our clientbase, the people that started on
corn and then finished corn andthen did beans would be a small,
small minority this year. So tome that maybe caps the window
for having a massive increase incorn acres. So I think there's
going to be the potential for abig surprise on the one way or
(15:38):
the other on the June cropreport, the acreage report. And
I think we've lost some of thebenefit of the early planting. I
think the market's looking pastsome of the problems that we've
had.
There'll be invariably someprevent plant in some of those
southern areas. So I thinkthere's a little bit of
everything in there, Todd. Andand to me, it says that it's not
perfect everywhere. In fact,there's probably few places.
(16:02):
Maybe Iowa would be the bull'seye of where it's perfect, but
it it's far from perfect as youget out of outside of Iowa and
still probably 180, 80 onepotential is there, but I'd say
that it's getting to be a higherand higher bar, barring
something that's just perfectfrom here on out and you know,
(16:22):
that's tall order.
So there should be someuncertainty ahead of us, I
think, in our book.
Todd Gleason (16:27):
I wanna go back through some of the rainfall
numbers and these are from thebeginning of the year just for
comparison's sake. Omaha,Nebraska, which I said has since
April 1 had 3.51 inches,normally would have about 10.
They're around seven and a halffor the year so far. That's
total for the year. Springfield,Illinois 9 Point 1 inches since
(16:50):
April 1.
Normally for the year to datearound 14 and a half inches and
they're right at 14 inches. Andthen there's some other numbers
for instance in Illinois MountVernon twenty six point six
inches of rainfall since thebeginning of the year in Mount
Vernon, Illinois, and theynormally get this would have had
(17:12):
19 inches there in April and May'16 and a half inches. And then
on the other end of the state atFreeport, Illinois, which is in
Far Northern Illinois up on theWisconsin line. They had 3.85
inches of rainfall since April1. They've had 6.8 since the
beginning of the year andnormally at 14.3 inches.
(17:35):
So they too are behind. That'skind of the spread of what
things look like across thestate of Illinois in comparison
to Omaha, Nebraska as well.Chip, I do want you to talk a
little bit about soybean oil asit relates to policies in
Washington DC. What concerns doyou have? And then Shane can
jump in after that.
Chip Nellinger (17:55):
Yeah, I think maybe the easiest way I could
put it is there isn't a policy.The market needs some clarity on
the policy and there isn't oneand there wasn't much in this
bill that's going through theSenate, at least at this point,
maybe some wording can getadded. But I think the soil
market has gotten a little aheadof itself, expecting by this
(18:18):
point on the calendar that we'dhave some clarity. We have not
only do we not have clarity,it's just a total black hole of
information. And without that,there's some potential demand
that could be lost theredomestically.
And I think the soil oil marketis ripe for a correction. I
don't want to see it because Ithink it's really going to cap
(18:40):
the potential of beans in theshort run too. That's
unfortunate because if you justthrow out everything
fundamentally and look at a beanchart, up until recently, it
looked good. It looked like thatwe were above that some of the
key moving averages and thefunds might really take an
interest in getting long beans,but if you overlay a soy oil
chart over beans, it pretty muchmirrored each other and now the
(19:05):
oil market, soy oil market isstarting to break down. Very
concerning, no market likesuncertainty and I think that
that soil market is full ofuncertainty.
There's very little certaintythere and my fear is that you
could see the funds maybe startliquidating some of the longs
because of the lack ofinformation on that renewable
(19:28):
diesel standpoint.
Todd Gleason (19:29):
Shane, so that you don't think that I don't follow
what's happening in your area ofrainfall, Fort Dodge is the
closest place I have for yousince April 1, six point four
six inches of rain. Normally,have eleven. You're running
ahead at twelve and twelve pointnine three. I would think things
would look really good there, asyou've already suggested they
(19:49):
have. But tell me about yourthoughts as it's related to the
soybean oil situation as well.
Shane Holtorf (19:55):
Yeah. I mean, I'm gonna echo a lot of those same
thoughts if we think back hereto, you know, a week a week ago,
you know, beans beans seem likemaybe they had caught their
breath and, from a chartperspective, kinda turned
around, and then we get thepotential to, you know, roll
back some of these credits, andwe see beans, you know, set back
(20:18):
again. And, you know, we we cantalk tariffs. We can talk, you
know, the the soybean oilpolicy. And I think the biggest
thing is is just the uncertaintyaround it.
You know, we've gotta we'vegotta know where we land on
this, and then I think themarket will provide some more
direction. And, you know, untilthen, we're going to, chase
(20:41):
headlines much like we've donewith these tariffs and and have
a yo yo effect.
Todd Gleason (20:46):
Alan Brugler, I would like to delve into your
wisdom on this marketplace as itrelates to, well, time that
you've been trading and whatyou're thinking this looks like
and how farmers need to managetariffs, ag policies, a global
(21:08):
marketplace that is in the midstof change.
Alan Brugler (21:12):
Well, the first thing is change. We always have
change. Okay? You you got thehype machine, the Internet, the
social media, the AI is tryingto make it look like there's
multiple more more crises thanwe've ever had before. I don't
buy that.
Okay. I've seen enough of thesecycles to know that. Yeah, the
(21:35):
flavor is different with thetariff war. Certainly I was
preaching last winter at someseminars and speeches I gave
that this trade war was notgoing to play out like the
twenty seventeen-eighteen one.And I think that's been accurate
to date.
One thing I would remind peopleis what I call my planet earth
theory, which is simply thatcrop production and for that
(22:00):
matter, livestock productiondoesn't leave the planet and
neither does the consumption. Soall this trade friction
essentially displaces where thetrade flows are going, but it
doesn't just as long as thedemand aggregate demand for the
world holds up, all you're doingis shifting who's selling what
(22:21):
to who. All right. Brazil sellsmore to China. We sell more to
whoever Brazil used to sell to.
The only rub there is if you'rein surplus stock situations,
then you don't wanna be the oneholding the carryover for an
extra six months. But so whatI'm saying is you have to just
let some of that news flow justgo on by you. Okay. Now having
(22:45):
said that, the world stocks useratios, I think are very
important here. As was pointedout earlier, globally corn
stocks have come down.
Wheat stocks use ratio as of theMay was, he was still coming
down for the fourth or fifthyear in a row. Beans are a
little different situation,125,000,000 tons or so. That's
(23:10):
surplus. That's too many to havemuch upward leverage on prices.
But again, I think that the keyis kind of sit back and say,
number one, know what your costproduction is.
That's an old saying, but it'sstill true. Don't let prices get
(23:30):
below that without getting someforward contracts on the books.
Look at your average annualtrading ranges to say what you
might be able to see over atwelve month period, which in
beans is something with a 9 infront of it, 9.25 to $12 would
be a typical range for amarketing year. All right, where
(23:53):
are you at in that right now?We're in the middle, But keep
that in the back of your head.
How could how good could it get?How bad could it get?
Todd Gleason (24:01):
On old stock corn, I would like to talk with each
of you just a little bit aboutthat because farmers will be
looking at the export figureshearing about ethanol usage and
demand, the summer driving, thefact that, cars are really
moving, already did so over theMemorial Day weekend and
(24:22):
thinking, hey, I did the rightthing. I'm gonna hold on. How
long do they have before theyreally ought to market? And I
suppose I'll take you in order,Alan, Shane, and then Chip.
Alan, how long?
Alan Brugler (24:35):
Well, seasonal tendency would be for new crop
to print high in May, June orJuly, many years. By
implication, if it's doing thatold crop would be as well. By
mid July, definitely got to bethinking, Hey, I gotta have this
thing emptied out or at leastnowhere that where I'm going to.
(25:00):
Having said that, you do have abig corn crop coming on and in
years where you are looking atrecord production or record
yield, that top tends to comeearly. So I think the biggest
question over the next six weeksis how's that crop faring?
And if the condition ratingsstart to creep up and June 30
(25:23):
doesn't result in any majorchange in acreage, you have to
move up that calendar forgetting rid of the old crop.
Shane Holtorf (25:30):
I would tend to agree with some of that. We
tightened up our stocks to useratio a little bit. You know,
we're we're below our five yearaverage. It's the lowest we've
looked at in three years. But ifwe wanna talk about how July
corn's traded over the last, youknow, three, four weeks, we
could look at the July, Decemberspreads to to illustrate that.
(25:52):
You know, we've seen it go outto to 30 back into zero and then
even in even in inverse here.And so that tells me that, our
focus is going to start to shiftto what December corn is doing.
And can we continue to be off toa great start in the West to
help to pull out our strugglesin the East? And I think July
(26:15):
corn is probably going tobenefit the most from some sort
of a new crop issue and justseeing the entire corn complex
rise versus, you know, any sortof excitement, in July futures
in and of themselves. So, Iwould echo that, you know, over
the course of the next thirty tosixty days, when opportunity
(26:38):
strikes, take advantage of it.
You know, we've got some reallygood basis in our neck of the
woods, and so I would I wouldlean into that a little bit and
look for the opportunity onthese rallies to just start
pricing.
Todd Gleason (26:51):
And, Chip, old crop corn stocks, what do you do
with them?
Chip Nellinger (26:53):
Yeah. You know, I I think six weeks ago, if you
were ask me that, Todd, I wouldsay you have till about the June
20. I think because of thisissue I talked about earlier
where in spite of some earlyplanting, the weather maybe has
slowed this crop down. Also,think we could be setting up for
kind of a counter seasonal typeof a year where the the normal
(27:14):
high comes in later, ratherthan, you know, that late June
time frame. So, I I would agreewith the basis.
You know, there's some reallyattractive basis around right
now. Consider, you know, puttinga basis contract maybe against
the December. The Septembercontract is always kind of an in
(27:34):
betweener and hard to figureout. So, you know, that ought to
give you, because of stillinverted markets, a really good
basis against December. I dothink that in short order,
December is going to pick upmore volume and open interest
and kind of be the lead month.
But I do think that we have tokind of at this point still
think about maybe pushing thatback into like mid to late July
(27:56):
to figure out how we're going toget through pollination and
whether there's any dry pocketsthat have, popped up across the
corn belt.
Todd Gleason (28:03):
Let's get a final word from each of you now. I
think Shane Holthorff, I'llstart with you. You can cover
livestock, corn, soybeans,wheat. What things have we not
talked about that you wanted totalk about today?
Shane Holtorf (28:15):
I think we did a pretty good job hitting on the
grains. We could we could talkfor another forty five minutes
about, you know, the livestockside of the business. And so if
we take a peek over there, wehaven't touched on that much
today. What a ride that's been.We saw earlier in the week, was
it Tuesday, start talking aboutthe new world screwworm and we
(28:41):
saw how fast this market canreact to adverse news.
Come to find out it was a falseflag and we've recovered and
actually today rallied prettygood. I was just looking, got a
message while we were sitting onthis call. We've got some cash
(29:01):
cattle trade out to 02:35 youknow, sitting here on Thursday
afternoon. And so that market,although we're sitting up here
at all time highs, doesn't showa lot of opportunity to slow
down. We're seeing these, cashside of the business still
continue to push.
Todd Gleason (29:19):
Alan Brugler at A and N Economics, your final word
for the day?
Alan Brugler (29:23):
Well, I'd emphasize the cattle situation
again. We're still in thetightest part of the cattle
cycle. In fact, from a feedlotsstandpoint, things get even
tighter when you start to putheifers on grass because they've
been in the feedlots for thelast year and a half, two years.
The placed against numbers, thecattle that will actually be
(29:45):
ready for slaughter are runningat decade lows for July, August
and September. And so thefeedlots still have some
leverage here.
There's gonna be $8 to $10swings from time to time just
because of funds getting in andout of these big moves. And
don't panic if you see a selloff like we saw the other day
(30:08):
with the Screwworm report. I'dalso remind people that we've
got the dollar has something todo with this and the interest
rates have something to do withthe dollar. And I do see some
buy signals on the treasurycharts right now. The the flows
all how interest rates are goingup, but the treasury futures
don't show that.
(30:29):
And, I think that's something tokeep an eye on.
Todd Gleason (30:31):
And finally, Chip Nellinger at Blue Reef AGRA
Marketing. Your final word.
Chip Nellinger (30:36):
Yeah. I would, echo that on the the cattle
side, man. What a a bull market,but it's getting along in the
tooth. And sometimes markets topon the most bullish news. So I I
think if you're a feedlot,listen to this.
Don't get queued and try to getlong, stay hedged, stay
protected because you'll neverbe able to pick the top of this
thing. On the row crop side, Ithink we have to take the long
(30:59):
view. Remember where your cropinsurance guarantees come in, be
ready to sell rallies. I thinkrallies can still come, but it
don't fall asleep on thesemarkets. Grain markets are kind
of stuck in the middle of arange here in a long term range.
To Alan's point earlier, you'reabout in the middle of what the
the yearly expected range is onbeans. And it's easy to get
(31:22):
complacent, but, you know, whenthe rally comes, it's going to,
necessitate a lot of action. Soget ready for that, have your
orders working, and it may be acase where obviously scale into
sales, but they may come fastand furious if we get the the
right type of, you know, weatherscare generated later this
(31:43):
summer.
Todd Gleason (31:44):
Commodity Week, of course, is a production of
Illinois Public Media. You mayfind and listen to the whole of
the program anytime you'd likeat willag.0rg or in your
favorite podcast applications.Our thanks go to our panelists
this week, including AlanBrugler, Shane Holtorf, and Chip
Nellinger on University ofIllinois Extension's Todd
(32:04):
Gleason.
This is the May 29 edition of Commodity Week. Todd
Gleason services are madeavailable to WILL by University
of Illinois Extension. Well,welcome to commodity week. I am
Todd Gleason. Our panelists forthe day include Alan Brugler.
(00:20):
He's at A and N Economics out ofOmaha, Nebraska. We'll ask him
about that in a moment. ShaneHoltorf is here from Logic Ag
Marketing. He's in Alta, Iowa.And Chip Nellinger joins us from
Blue Reef Agrimarketing out ofMorton, Illinois.
Commodity Week is a productionof Illinois Public Media. This
is public radio for the farmingworld online, on demand anytime
(00:41):
you'd like to listen atwillag.0rg or in your favorite
podcast applications. AlanBrugler, let's begin with you.
Brugler marketing and managementstill exist, although I take it
about a year ago you steppedaway just a bit and operate more
at arm's length. Can you tell meabout this transition?
Alan Brugler (01:06):
Yeah. Basically, I turned 70 and maxed out my
Social Security and I said it'stime to get away from the day to
day operations. So I I sold theburglar operating rights, naming
rights, product names,subscriber base, all that to
Austin Schroeder. He'd been anemployee of mine for about eight
(01:26):
years and is very good atduplicating everything I I did.
I'm still affiliated withBrugler marketing.
You'll see it some places on theInternet. I write columns for
them occasionally, consult on onhedging positions and so forth
and do do speeches. But A and Neconomics is is the place to to
(01:48):
park money and and if somebodywants to reach me for a speech
or whatever. But I'm still stillinvolved in the markets, but,
more of an on arm's length and,more consulting base rather than
day to day advice.
Todd Gleason (02:01):
That may be good in this year, and
congratulations, by the way. Sowhat are the things that you're
watching most closely and thatwe should maybe talk about
today?
Alan Brugler (02:10):
Well, I I I think the tariff situation definitely
is is top of mind again withthat trade court ruling saying
that many of the Trump tariffsare illegal. I think that's a
very important shift here interms of it's not immediate
because there's going to be someappeals and so forth. But I
(02:31):
think it does change theleverage that the administration
has, and it does have someimplications for our commodity
marketing. You know, weather isanother one, I think, concerns
about too wet down south and anyprevent plant, that type of
thing.
Todd Gleason (02:46):
Shane Holtorf from Logic Ag Marketing. What's on
your mind that we should discussthis week?
Shane Holtorf (02:51):
Yeah. So, obviously, we, we saw the May
out, and, we tightenedeverything up a little bit. You
know, I don't I don't think wehave a lot of room for a mistake
throughout this year. You know,we've shrunk the global balance
sheet to the tightest it's beenon the corn side in over ten
years, and beans don't have alot of breathing room either. So
(03:14):
we're going to need to get offto a good start and keep our
foot on our gas growing thesegrowing these crops.
Todd Gleason (03:21):
And finally, Chip Nellinger of Blue Reef
AgriMarketing. Anything you'dlike to add before we get
started?
Chip Nellinger (03:26):
Yeah. I I think in addition to what was talked
about previously, one thing thatI'm watching pretty closely is
the soy oil market is lookingvery heavy right now. Really
disappointment with a lack ofclarity or any answers as it
relates to the biodieselsituation and what or what might
not be taking place on themandate side there. So the soil
(03:49):
oil market, if you overlay thatagainst the bean market, it's
been a pretty perfectcorrelation. And it looks to me
like the soil oil market has alot of fund links.
We stopped making higher highs.We're starting to violate some
of the key moving averages andthat market without clarity into
what the future demand may belooks a little potentially top
(04:10):
heavy to me.
Todd Gleason (04:10):
Let's start with trade and tariffs, Alan Brugler.
There were two courts actuallythis week, the Court of
International Trade and then asecond one that was dealing with
some toy companies that bothsaid the Trump administration's
use of a 1977 law was unlawfulin terms of imposing a tariff
(04:36):
that covered everything onLiberation Day, which was the
10% plus reciprocals, and italso backtracked to the Mexico
and Canada and China tariffsthat were imposed prior to that.
What issues do you expect themarketplace to have to deal
(04:56):
with, and what have you beenthinking about as it relates to
this particular subject matter?
Alan Brugler (05:02):
Well, obviously, that's been a key part of the
negotiating strategy for theadministration. They're trying
to raise revenue from thetariffs to help pay for some of
the other tax cuts. They'retrying to enforce some changes
in non trade behavior in some ofthese other countries,
intellectual property rights andthat sort of thing. So it's
(05:24):
definitely impaired that alittle bit because those
countries can say, well, wedon't know if you really have
the stick anymore that you'retrying to beat us with. No.
I do think that these rulingsare are not the be all and end
all. I think you're gonnaimmediately see the
administration appeal them.You're gonna go to a higher
court. It could eventually endup at the Supreme Court. The key
(05:49):
that I'm watching relative tothe to the tariff ruling is when
it goes to that through thatappeals process, does the next
court issue any kind of stay orinjunction?
Can the administration continueto implement the tariffs until
the appeals are done? Or do theyput a hold on them until the
appeal is process is done? Now,does it affect soybean exports
(06:14):
in the summer of twenty twentyfive? Probably not because
seasonally we don't do muchright here. I think you the big
issue though, is it does changethe leverage.
And I think you also have toremember that it does not affect
as you alluded to earlier, doesnot affect steel and aluminum.
(06:35):
Those were implemented under oneof the other laws and those
tariffs are still in place. So,you know, anything that's,
relying on imported steel pricesis still gonna be more
expensive.
Todd Gleason (06:45):
Let's stay with Washington DC, Shane Holtorf,
but we'll move to USDA and themonthly reports. What
expectations do you have when wetransition from the May WASDE to
the June World Ag Supply andDemand Estimates?
Shane Holtorf (07:03):
Sure. Well, we're certainly off to a blazing start
when you look at the planningprogress. You know, we've blown
the last five years out of thewater. On the corn planting
progress, you know, I'm fromNorthwest Iowa. And, you know,
when we talked last time, wewere off to a really quick
start, got off to an earlyfinish.
(07:24):
Things are looking great here,but I think Chip was the one
that alluded to, that may notall be rosy in other areas. And
so as you start to talk aboutthe potential for prevent plant,
are we going to see some acresthat we had originally thought
were going to corn because ofthe quick planting progress,
(07:46):
maybe not make its way to cornor find its way to beans? I've
also got a question, you know,as time starts to delay, what
happens to this, you know, 181bushel yield that we're, you
know, that we're starting outwith. And so if we, knock a
bushel or two here or there offof the corn balance sheet and
(08:08):
trim up those acres, we go froma very, very comfortable
position to maybe a little lesscomfort as we look at the
balance sheet. You know, on thebean side, you know, kind of the
same thing, but if if we see alittle acreage shift over to the
(08:28):
the bean side of the market, Youknow, we're we we've always just
kinda tow that line, right, on300,000,000 bushel carryout, and
I think that's that's kindawhere we're gonna be here.
And so, you know, I won't stealChip's Thunder, but I think a
lot has to do with on the beanside, more the SAF focal points
and what we're gonna do withsome of these rulings.
Todd Gleason (08:50):
We'll get to Chip in just a second. I do wanna ask
both you and Alan because you'rein that area, Northwest Iowa and
then West Central Iowa,speaking, as it relates to
Omaha, Nebraska. Did the cornplanters just continue to roll
there? And are do you both thinkthat at this point you're off to
(09:11):
such a good start that you havea really good chance at having
exceptional yields in thoseareas? So Shane, did the farmers
continue to plant corn, and isthe crop looking really good?
Shane Holtorf (09:24):
Yeah. So I would say, you know, based upon the
farmers that that we talkedwith, you know, there wasn't a
lot that that switched over tocontinue into that corn planting
side of things. You know, theremight have been a a 40 switch
tier and 80 there. You know? Butit seems by and large, by the
time the planters start to roll,the decisions gotta be made
(09:47):
because, you know, they've gottheir chemicals, you know, on
farm fertilizer being spread,and you don't wanna mess up the
ballet, so to speak.
And so what I I don't think wesaw as much switches, you know,
what we're originally thinkingor anticipating. But as far as
the crops being off to a reallygood start, you you can walk out
(10:09):
these fields and do a standcount, and everything that was
planted came up. You know, therewas a few guys that spiked in,
you know, one or two plant dateswhere they had a little issue
with emergence. But by andlarge, the emergence is great.
We've been getting some timelyrains.
We needed some heat. We neededsome sun. We're gonna get that
(10:30):
for the next four or five days,and then it's looking like it's
going to rain again. So thingshere are looking pretty good.
Todd Gleason (10:37):
And then, Alan, if you could follow-up because the
West Central Crop ReportingDistrict in Iowa is its largest
production district. What haveyou seen when you've been out
driving?
Alan Brugler (10:50):
Yeah, got a pretty good perspective of the whole
Corn Belt. As a week and a halfago, I drove from Ohio or Omaha
to Ohio, in fact. And, you know,in general, Nebraska and Iowa
looked great. Everything was in,everything was up pretty much on
the corn side. Beans were alittle further behind.
Obviously you got into Illinois,it had obviously just been
(11:12):
planted Indiana. They've donethe field work, but nothing was
up yet in Ohio. They werewaiting on it to dry out enough
to plant. And you saw that inthis week's planning progress
that Ohio's way behind alongwith some of the states to the
south where they've got someflooding issues. I will say that
the crop yield potential rightnow in the Western Corn Belt is
(11:35):
tremendous because we've gotexcellent stands here, right in
the Omaha and Western Iowa area.
We miss some of those rains thatthey got in the Northwest. Omaha
itself is two and a half inchesbelow normal for the month of
May with a couple of days lefthere. And I think about the same
for the year to date. So, youknow, a little more water in the
(11:58):
non irrigated areas would bevery welcome. We had some of the
Nebraska producers actually rantheir irrigation just to get
their germination where theywanted it.
They didn't want to keep doingthat. It's too early in the
season, but they had to justactivate the chemicals and get
the seed up. But yeah, thebiggest problem is problems that
(12:20):
I see in the Corn Belt aremostly Ohio and Indiana being
behind because it'd be in toowet. Then, you know, the smaller
acreage states in the Southcould lose a few corn acres to
beans. But because of that rapidplant progress, I'm also
concerned we might have pickedup a few extra acres in the
Western Hornbelt.
Todd Gleason (12:39):
And just, so that the numbers are there, you are
correct. It's about two and ahalf inches behind. For year to
date, I don't know about themonth of May, but since April 1,
only 3.51 inches of rainfall inOmaha, Nebraska. Those are
aggrable numbers. ChipNellinger, I wanna turn to you,
(13:02):
and ask about the Eastern CornBelt, what you're hearing as
it's related, and we just had afirsthand look at it with Alan,
but how far really are theybehind, and do you think the
prevent plant that might show upthere would be enough to offset
the really big numbers thatcould come out of Illinois and
(13:22):
Iowa?
Chip Nellinger (13:23):
Yeah, Todd, that's a loaded question. I
think it depends on where you'reat. I think a couple things are
at work here. As you get throughIllinois, Indiana, Illinois
especially, North of Interstate70, things are pretty good.
Things got in early.
South of there, it's been adisastrous spring, and I think
(13:44):
the market's somewhatoverlooking that. So there's
still areas that are finished upplanting. They're getting too
much rain. They're waiting onthings to dry out. As you get
into Kentucky and Tennessee,it's even more disastrous on
some of these acres.
There's been floods, in in someof the, you know, Mississippi
River bottom areas. So we talkedto producers there that have
(14:05):
really struggled to get stuff inthe ground. I think the early
planting, I think the market sawthe early planting pace and said
all things are perfect, thingsare great, we're going to get
this crop in the ground and it'sgoing to be awesome. And I would
argue that at least in Illinois,the northern two thirds of
Illinois, yeah, there might havebeen some early planting, but
then it got overcast, reallycool, little bit of rain, and
(14:29):
that seed just sat there. Andand even if it was a merge, we
just sat there and did nothing.
So I'd I'd argue, and I'm not anagronomist, this is just my
opinion, that we've kinda lost alot of benefit of that early
planting and things are, youknow, more of a normal planting
pace because they sat there forso long. So I I think there's a
lot of things that work there. II think also there's areas, the
old I I don't necessarily buythe old argument that early
(14:52):
planting and good planting leadsto more corn acres because so
many farmers now, especially thelast three years, start on
beans, right? And so at leastthrough the heart of the Corn
Belt, which is where some ofthose acres you would expect to
swing, farmers started on beans.And that's kind of the majority
(15:13):
in that area.
In fact, it's across our clientbase, the people that started on
corn and then finished corn andthen did beans would be a small,
small minority this year. So tome that maybe caps the window
for having a massive increase incorn acres. So I think there's
going to be the potential for abig surprise on the one way or
(15:38):
the other on the June cropreport, the acreage report. And
I think we've lost some of thebenefit of the early planting. I
think the market's looking pastsome of the problems that we've
had.
There'll be invariably someprevent plant in some of those
southern areas. So I thinkthere's a little bit of
everything in there, Todd. Andand to me, it says that it's not
perfect everywhere. In fact,there's probably few places.
(16:02):
Maybe Iowa would be the bull'seye of where it's perfect, but
it it's far from perfect as youget out of outside of Iowa and
still probably 180, 80 onepotential is there, but I'd say
that it's getting to be a higherand higher bar, barring
something that's just perfectfrom here on out and you know,
(16:22):
that's tall order.
So there should be someuncertainty ahead of us, I
think, in our book.
Todd Gleason (16:27):
I wanna go back through some of the rainfall
numbers and these are from thebeginning of the year just for
comparison's sake. Omaha,Nebraska, which I said has since
April 1 had 3.51 inches,normally would have about 10.
They're around seven and a halffor the year so far. That's
total for the year. Springfield,Illinois 9 Point 1 inches since
(16:50):
April 1.
Normally for the year to datearound 14 and a half inches and
they're right at 14 inches. Andthen there's some other numbers
for instance in Illinois MountVernon twenty six point six
inches of rainfall since thebeginning of the year in Mount
Vernon, Illinois, and theynormally get this would have had
(17:12):
19 inches there in April and May'16 and a half inches. And then
on the other end of the state atFreeport, Illinois, which is in
Far Northern Illinois up on theWisconsin line. They had 3.85
inches of rainfall since April1. They've had 6.8 since the
beginning of the year andnormally at 14.3 inches.
(17:35):
So they too are behind. That'skind of the spread of what
things look like across thestate of Illinois in comparison
to Omaha, Nebraska as well.Chip, I do want you to talk a
little bit about soybean oil asit relates to policies in
Washington DC. What concerns doyou have? And then Shane can
jump in after that.
Chip Nellinger (17:55):
Yeah, I think maybe the easiest way I could
put it is there isn't a policy.The market needs some clarity on
the policy and there isn't oneand there wasn't much in this
bill that's going through theSenate, at least at this point,
maybe some wording can getadded. But I think the soil
market has gotten a little aheadof itself, expecting by this
(18:18):
point on the calendar that we'dhave some clarity. We have not
only do we not have clarity,it's just a total black hole of
information. And without that,there's some potential demand
that could be lost theredomestically.
And I think the soil oil marketis ripe for a correction. I
don't want to see it because Ithink it's really going to cap
(18:40):
the potential of beans in theshort run too. That's
unfortunate because if you justthrow out everything
fundamentally and look at a beanchart, up until recently, it
looked good. It looked like thatwe were above that some of the
key moving averages and thefunds might really take an
interest in getting long beans,but if you overlay a soy oil
chart over beans, it pretty muchmirrored each other and now the
(19:05):
oil market, soy oil market isstarting to break down. Very
concerning, no market likesuncertainty and I think that
that soil market is full ofuncertainty.
There's very little certaintythere and my fear is that you
could see the funds maybe startliquidating some of the longs
because of the lack ofinformation on that renewable
(19:28):
diesel standpoint.
Todd Gleason (19:29):
Shane, so that you don't think that I don't follow
what's happening in your area ofrainfall, Fort Dodge is the
closest place I have for yousince April 1, six point four
six inches of rain. Normally,have eleven. You're running
ahead at twelve and twelve pointnine three. I would think things
would look really good there, asyou've already suggested they
(19:49):
have. But tell me about yourthoughts as it's related to the
soybean oil situation as well.
Shane Holtorf (19:55):
Yeah. I mean, I'm gonna echo a lot of those same
thoughts if we think back hereto, you know, a week a week ago,
you know, beans beans seem likemaybe they had caught their
breath and, from a chartperspective, kinda turned
around, and then we get thepotential to, you know, roll
back some of these credits, andwe see beans, you know, set back
(20:18):
again. And, you know, we we cantalk tariffs. We can talk, you
know, the the soybean oilpolicy. And I think the biggest
thing is is just the uncertaintyaround it.
You know, we've gotta we'vegotta know where we land on
this, and then I think themarket will provide some more
direction. And, you know, untilthen, we're going to, chase
(20:41):
headlines much like we've donewith these tariffs and and have
a yo yo effect.
Todd Gleason (20:46):
Alan Brugler, I would like to delve into your
wisdom on this marketplace as itrelates to, well, time that
you've been trading and whatyou're thinking this looks like
and how farmers need to managetariffs, ag policies, a global
(21:08):
marketplace that is in the midstof change.
Alan Brugler (21:12):
Well, the first thing is change. We always have
change. Okay? You you got thehype machine, the Internet, the
social media, the AI is tryingto make it look like there's
multiple more more crises thanwe've ever had before. I don't
buy that.
Okay. I've seen enough of thesecycles to know that. Yeah, the
(21:35):
flavor is different with thetariff war. Certainly I was
preaching last winter at someseminars and speeches I gave
that this trade war was notgoing to play out like the
twenty seventeen-eighteen one.And I think that's been accurate
to date.
One thing I would remind peopleis what I call my planet earth
theory, which is simply thatcrop production and for that
(22:00):
matter, livestock productiondoesn't leave the planet and
neither does the consumption. Soall this trade friction
essentially displaces where thetrade flows are going, but it
doesn't just as long as thedemand aggregate demand for the
world holds up, all you're doingis shifting who's selling what
(22:21):
to who. All right. Brazil sellsmore to China. We sell more to
whoever Brazil used to sell to.
The only rub there is if you'rein surplus stock situations,
then you don't wanna be the oneholding the carryover for an
extra six months. But so whatI'm saying is you have to just
let some of that news flow justgo on by you. Okay. Now having
(22:45):
said that, the world stocks useratios, I think are very
important here. As was pointedout earlier, globally corn
stocks have come down.
Wheat stocks use ratio as of theMay was, he was still coming
down for the fourth or fifthyear in a row. Beans are a
little different situation,125,000,000 tons or so. That's
(23:10):
surplus. That's too many to havemuch upward leverage on prices.
But again, I think that the keyis kind of sit back and say,
number one, know what your costproduction is.
That's an old saying, but it'sstill true. Don't let prices get
(23:30):
below that without getting someforward contracts on the books.
Look at your average annualtrading ranges to say what you
might be able to see over atwelve month period, which in
beans is something with a 9 infront of it, 9.25 to $12 would
be a typical range for amarketing year. All right, where
(23:53):
are you at in that right now?We're in the middle, But keep
that in the back of your head.
How could how good could it get?How bad could it get?
Todd Gleason (24:01):
On old stock corn, I would like to talk with each
of you just a little bit aboutthat because farmers will be
looking at the export figureshearing about ethanol usage and
demand, the summer driving, thefact that, cars are really
moving, already did so over theMemorial Day weekend and
(24:22):
thinking, hey, I did the rightthing. I'm gonna hold on. How
long do they have before theyreally ought to market? And I
suppose I'll take you in order,Alan, Shane, and then Chip.
Alan, how long?
Alan Brugler (24:35):
Well, seasonal tendency would be for new crop
to print high in May, June orJuly, many years. By
implication, if it's doing thatold crop would be as well. By
mid July, definitely got to bethinking, Hey, I gotta have this
thing emptied out or at leastnowhere that where I'm going to.
(25:00):
Having said that, you do have abig corn crop coming on and in
years where you are looking atrecord production or record
yield, that top tends to comeearly. So I think the biggest
question over the next six weeksis how's that crop faring?
And if the condition ratingsstart to creep up and June 30
(25:23):
doesn't result in any majorchange in acreage, you have to
move up that calendar forgetting rid of the old crop.
Shane Holtorf (25:30):
I would tend to agree with some of that. We
tightened up our stocks to useratio a little bit. You know,
we're we're below our five yearaverage. It's the lowest we've
looked at in three years. But ifwe wanna talk about how July
corn's traded over the last, youknow, three, four weeks, we
could look at the July, Decemberspreads to to illustrate that.
(25:52):
You know, we've seen it go outto to 30 back into zero and then
even in even in inverse here.And so that tells me that, our
focus is going to start to shiftto what December corn is doing.
And can we continue to be off toa great start in the West to
help to pull out our strugglesin the East? And I think July
(26:15):
corn is probably going tobenefit the most from some sort
of a new crop issue and justseeing the entire corn complex
rise versus, you know, any sortof excitement, in July futures
in and of themselves. So, Iwould echo that, you know, over
the course of the next thirty tosixty days, when opportunity
(26:38):
strikes, take advantage of it.
You know, we've got some reallygood basis in our neck of the
woods, and so I would I wouldlean into that a little bit and
look for the opportunity onthese rallies to just start
pricing.
Todd Gleason (26:51):
And, Chip, old crop corn stocks, what do you do
with them?
Chip Nellinger (26:53):
Yeah. You know, I I think six weeks ago, if you
were ask me that, Todd, I wouldsay you have till about the June
20. I think because of thisissue I talked about earlier
where in spite of some earlyplanting, the weather maybe has
slowed this crop down. Also,think we could be setting up for
kind of a counter seasonal typeof a year where the the normal
(27:14):
high comes in later, ratherthan, you know, that late June
time frame. So, I I would agreewith the basis.
You know, there's some reallyattractive basis around right
now. Consider, you know, puttinga basis contract maybe against
the December. The Septembercontract is always kind of an in
(27:34):
betweener and hard to figureout. So, you know, that ought to
give you, because of stillinverted markets, a really good
basis against December. I dothink that in short order,
December is going to pick upmore volume and open interest
and kind of be the lead month.
But I do think that we have tokind of at this point still
think about maybe pushing thatback into like mid to late July
(27:56):
to figure out how we're going toget through pollination and
whether there's any dry pocketsthat have, popped up across the
corn belt.
Todd Gleason (28:03):
Let's get a final word from each of you now. I
think Shane Holthorff, I'llstart with you. You can cover
livestock, corn, soybeans,wheat. What things have we not
talked about that you wanted totalk about today?
Shane Holtorf (28:15):
I think we did a pretty good job hitting on the
grains. We could we could talkfor another forty five minutes
about, you know, the livestockside of the business. And so if
we take a peek over there, wehaven't touched on that much
today. What a ride that's been.We saw earlier in the week, was
it Tuesday, start talking aboutthe new world screwworm and we
(28:41):
saw how fast this market canreact to adverse news.
Come to find out it was a falseflag and we've recovered and
actually today rallied prettygood. I was just looking, got a
message while we were sitting onthis call. We've got some cash
(29:01):
cattle trade out to 02:35 youknow, sitting here on Thursday
afternoon. And so that market,although we're sitting up here
at all time highs, doesn't showa lot of opportunity to slow
down. We're seeing these, cashside of the business still
continue to push.
Todd Gleason (29:19):
Alan Brugler at A and N Economics, your final word
for the day?
Alan Brugler (29:23):
Well, I'd emphasize the cattle situation
again. We're still in thetightest part of the cattle
cycle. In fact, from a feedlotsstandpoint, things get even
tighter when you start to putheifers on grass because they've
been in the feedlots for thelast year and a half, two years.
The placed against numbers, thecattle that will actually be
(29:45):
ready for slaughter are runningat decade lows for July, August
and September. And so thefeedlots still have some
leverage here.
There's gonna be $8 to $10swings from time to time just
because of funds getting in andout of these big moves. And
don't panic if you see a selloff like we saw the other day
(30:08):
with the Screwworm report. I'dalso remind people that we've
got the dollar has something todo with this and the interest
rates have something to do withthe dollar. And I do see some
buy signals on the treasurycharts right now. The the flows
all how interest rates are goingup, but the treasury futures
don't show that.
(30:29):
And, I think that's something tokeep an eye on.
Todd Gleason (30:31):
And finally, Chip Nellinger at Blue Reef AGRA
Marketing. Your final word.
Chip Nellinger (30:36):
Yeah. I would, echo that on the the cattle
side, man. What a a bull market,but it's getting along in the
tooth. And sometimes markets topon the most bullish news. So I I
think if you're a feedlot,listen to this.
Don't get queued and try to getlong, stay hedged, stay
protected because you'll neverbe able to pick the top of this
thing. On the row crop side, Ithink we have to take the long
(30:59):
view. Remember where your cropinsurance guarantees come in, be
ready to sell rallies. I thinkrallies can still come, but it
don't fall asleep on thesemarkets. Grain markets are kind
of stuck in the middle of arange here in a long term range.
To Alan's point earlier, you'reabout in the middle of what the
the yearly expected range is onbeans. And it's easy to get
(31:22):
complacent, but, you know, whenthe rally comes, it's going to,
necessitate a lot of action. Soget ready for that, have your
orders working, and it may be acase where obviously scale into
sales, but they may come fastand furious if we get the the
right type of, you know, weatherscare generated later this
(31:43):
summer.
Todd Gleason (31:44):
Commodity Week, of course, is a production of
Illinois Public Media. You mayfind and listen to the whole of
the program anytime you'd likeat willag.0rg or in your
favorite podcast applications.Our thanks go to our panelists
this week, including AlanBrugler, Shane Holtorf, and Chip
Nellinger on University ofIllinois Extension's Todd
(32:04):
Gleason.
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