PM Comments April 8 2025
Good afternoon. Soybeans, and nearby corn led the advances for our ag markets on Tuesday. Early session strength had a feeling of "risk-on" type trade as equities, energies and the grain markets rallied. However, investors seem to lack confidence in many of the various markets as, especially equities and energies turned noticeably weaker by the middle of the afternoon. Nearby corn futures managed to finish the day higher, as well as wheat and meal futures. Soybean oil finished the day on the defensive. New crop corn and soybeans also finished the day slightly weaker. Daily export sales included 240,000 MT of US corn being sold to Spain. China was thought to be a large buyer of Brazilian soybeans.
Bull spreading was a common theme for both corn and soybeans on Monday. CK finished the day at 4.69, up 4.50 cents to settle at a 3-week high and also on the 100-day moving average. CN closed 4.0 cents higher at 4.74 3/4 while CZ closed 1/4 cent weaker at 4.45 3/4. Moving to soybeans, SK finished the day at 9.9275, up 9.75 cents while SN finished 7.0 cents higher at 10.04 and SX closed 3.25 cents weaker at 9.77 3/4. Soybean products were mixed with meal finishing the day $2.60 higher vs the May futures while bean oil closed .21 weaker vs the May futures. Chicago wheat closed 3.50 cents higher vs the May futures at 5.40. CK/CN finished the day 0.50 higher at -5.75 while CN/CU firmed 4.25 cents to settle at +36.0. SK/SN jumped 2.75 cents on the day to finish at -11.25 while the SN/SX firmed 10.25 cents at +26.25. Cattle markets were mixed with April live cattle closing up .17 at 199.10 while the June contract closed .55 lower at 193.62. Feeder cattle finished the day 2.60 higher at 280.42 vs the April futures and .45 higher vs the May at 271.72. Lean hogs were mixed with May closing .52 higher at 84.60 and 27 cents lower vs the June contract at 89.77.
The outside markets were higher to begin the day but were unable to hold gains into the close. The equity markets were posting gains in excess of 3% early Tuesday, but have turned noticeably weaker by mid-afternoon. At last glance, the Nasdaq was trading 348 points lower, roughly 1100 points off the highs for the day (6% daily drop from the highs). Crude oil was 1.85 weaker at last glance, roughly $3.00 off the early highs. Precious metals were higher while industrial metals have turned lower. Gold was trading $24 higher at $2,975 at last check. The dollar index spent most of the day in the red, down roughly 38 points at 102.59. The 20-day moving average has acted as resistance over the last several sessions. Orange juice had a large bounce this morning, scoring a key reversal and bouncing nearly 10% after trading to new lows for the move.
In addition to the 240,000 MT of US corn sales to Spain, there are rumors of a few US bean cargoes being sold into the EU. There is talk that EU's retaliatory tariffs are being pushed back into May which should help corn and soybean sales. Speaking of tariffs, China says they will "fight to the very end" against the US and Trump's new tariff policy. But then, the next thing you see or hear is that China is wanting to end the trade war, they just don't know how. The Trump tariffs against China are expected to jump to 104% at midnight tonight.
The weather models are mixed with the GFS still calling for rainfall in excess of 1.00" to fall across E KS and E OK into the middle to later part of next week. These rains will help the winter wheat crop that isn't necessarily off to the greatest start. The initial Crop Ratings report showed the crop at 48% good to excellent vs 56% for the initial reading last year. Spring wheat is 3% planted, in line with average. Corn plantings were at 2% planted vs 3% last year. During the same timeframe, beneficial rains are expected across the N Plains as well. The wet areas of the Delta and S Midwest will see additional rainfall next week, although rainfall totals across the drenched areas of AR will be spotty in nature. Dryness concerns are still present for E Brazil as well as parts of Europe and also the Black Sea Region. Parts of Russia and Ukraine have received recent showers, but there is nothing currently forecasted to greatly improve drought conditions.
With China's extended tariffs kicking into full gear tonight, as well as all other tariffs above the 10% baseline kicking in tonight, a rather volatile week is expected for our ag space, energy, and equity markets. News that Trump and the South Korean leader Han Duck-soo meeting went well today is encouraging, but details are lacking. The marketplace needs to see progress in these trade talks to lower trader anxiety and bring calm back to the marketplace.