AM Comments March 20 2025
Good morning. Chicago ag markets are again mixed to start Thursday trading, as has been the case most every morning this week. We won't keep beating the the dead horse, but it seems very apparent that traders are waiting for some kind of input, either bullish or bearish, to dictate their next move, and there just simply hasn't been anything of note that doesn't involve geopolitics or trade policy. Technically this morning, corn futures re-tested the week's highs early last night but are back a few cents now, while soybeans have made new lows for the week and are staring a down fourth straight lower session if things don't turn around throughout the day today. But that being said, bigger picture price direction continues to be determined by final crop sizes in South America in the case of corn, and just how many acres will be lost year/year in the US for soybeans. Corn futures to start Thursday are trading 1-2 cents higher, soybean futures are trading 3-4 cents lower, and the Chicago wheat market is down 2-3 cents. Products are mixed, soybean meal is up around 50 cents/ton, and soybean oil is down 20-30 points. Outside markets are also mixed, crude oil futures are up 10-20 cents/bbl, the Dow Jones index is down 130 points, and the US$ index is up 40-50 points. The S&P500 is down 20 points and the NASDAQ is down 100 points; gold futures are slightly lower but have again made new contract highs overnight.
Today's Reports: Weekly Export Sales; Weekly Jobless Claims
- This morning's weekly export sales report for the week ending March 13th is expected to show corn sales for the week in a range of 800k to 1.7 mil mt's, soybean sales in a range of 400k-900k mt's, and wheat sales in a range of 300k to 700k mt's. 2025/26 corn sales are seen between 0-100k mt's, soybeans between 0-50k mt's, and wheat between 25k-100k mt's.
- Private industry group Abiove on Wednesday lowered their estimate for Brazilian soybean production just slightly to 170.9 mmt's, which would still be an increase of more than 10% compared to last year. The group made no adjustments to crush or exports, and sees the first up 3% from last year at 57.5 mmt's, while the latter is seen at 106.1 mmt's, which would be a new annual record. Brazil ending stocks are seen at 9.1 mmt's, which would be up about 1.6% from last year.
- The USDA's ag attaché to China on Wednesday said in a report that Chinese soybean production in the 2025/26 marketing year is seen at 19.8 mmt's, which would be down marginally from 2024/25. Imports are seen at 106 mmt's, which would be up 2% from last year. The report also mentioned that import demand for most oilseeds and products is expected to be below the recent five-year average due to strong domestic production and economic headwinds.
- Sources familiar with the matter say that proposed port fees on Chinese built ships could cost the US ag industry upwards of nearly a billion dollars annually, as exporters are unable to book shipments due to not knowing what the cost of freight will be. Exports of energy products like coal and liquified natural gas are also being affected, as added costs are making these products non-competitive on the global market.
- In an announcement made on Wednesday, the USDA said in a statement that they would be reinstating the July cattle survey, as well as county-level crop estimates for most US field crops and cattle beginning in May. The reports were cut last year due to insufficient funding, which was met with significant pushback from industry representatives. The July cattle inventory will be published this year on July 25th.
- Following yesterday's expected interest rate decision from the US Federal Reserve, traders now expect just two rate cuts in the 2025 calendar year, as opposed to the three that have been expected largely since the end of last fall. This falls more in-line with most economist's expectations, but with pressure from President Trump to "do the right thing" (a comment he made on Truth Social to policymakers following the decision), its hard to say just how the interest rate landscape will look by mid-summer.
- Not a lot new from yesterday on weather in South America. Models continue to see another few days of dryer conditions in Argentina, before moisture is set to return by early next week. South-central Brazil looks to also continue receiving rains into next week, though areas to the far south look continue missing out and will remain on the dry side. Heat will remain a concern at least through next week in Brazil, as models continue to show well above average temp anomalies for most of the country's growing regions. Argentina has trended cooler in the south, but stays warm in the north.
- Midwest precip out of Wednesday's storm system was largely as predicted, with heavy snowfall of 8-12" being observed from E NE through NW IA and into WI and MN. Northern IL and parts of IN picked up rainfall of around a half inch with some lighter totals observed further into the southeast, but otherwise, the rest of the area was mostly dry. As this system continues working north and east, the East Coast and north eastern US will see precip through the day today, but totals generally aren't expected to exceed a quarter inch.
- Once this system exits the East Coast, models are in good agreement on a small disturbance bringing possible light precip to the upper Midwest Friday night into Saturday morning, while another, bigger, low pressure system is being forecast for generally the same areas as yesterday's event through the day on Sunday and into Monday evening. Temperature forecasts continue to be in fair agreement on a shot of cooler air coming into the east/northeast by next week, but then fall out of agreement past there.