Grain Comments: 03.05.25

Good morning. Yesterday’s end-of-session bounce has made its way into the overnight trade to start Wednesday, with corn, beans and wheat all in recovery mode and trading higher this morning. The dollar index has continued its slide, which coupled with the recovery in ag values is giving the bull camp hope that prices scored a short-term low on Tuesday and can now work back higher as we approach the US spring planting season. We would also remind that just because the tariffs were put on yesterday does not mean that headline risk has declined; talks between the US and all three of China/Canada/Mexico will be ongoing, with the possibility that a deal could be struck with any of three at any point still seemingly still existing. Stay aware of risk and don’t get complacent. Corn futures to start mid-week are trading 4-8 cents higher, soybean futures are trading 6-10 cents higher, and the Chicago wheat market is trading 10-12 cents higher. Products are higher, soybean meal is up $4-6/ton, and soybean oil is up 10-15 points. Mixed trade in the outside markets, crude oil futures are down around $1.30/bbl, the Dow Jones index is up 100 points, and the US$ index is down 65 points. The S&P500 is up 20 points and the NASDAQ is up 100 points; gold futures are quietly higher and inside of yesterday’s range, with the latter broadly being the case for a lot of commodities to start Wednesday.

Today’s Reports: Monthly Factory Orders; EIA Weekly Ethanol Production/Energy Stocks

• Deliveries stayed active this morning, with the CME Group assigning 53 contracts of soybean meal, 212 contracts of soybean oil, 220 contracts of corn, 3 contracts of Chicago wheat, 85 contracts of KC wheat, and 2 contracts of oats.

• This morning’s weekly ethanol production report for the week ending February 28th is expected to show daily production in a range of 1.060-1.072 mil bbls, while stocks are expected to stay above 27 mil bbls at 27.143-27.557 mil bbls. On average, both figures would be down slightly from last week.

• Russian Ag Minister Oksana Lut on Tuesday said that the country plans to increase its crop planted area in the coming season by 1 million hectares to 84 mil ha’s; of that, 55.8 mil is expected to be seeded with spring crops, while the remaining part consists of winter crops of which more than 85% are seen in either good or satisfactory condition.

• Chinese officials said on Wednesday that the coverage of full-cost insurance and production income insurance would be extended to soybean farmers, in a move that aims to encourage seeding additional hectares of the crop. Sources familiar also said officials would be implementing a minimum purchase price policy for rice and wheat, while on the production side, estimates of total grain production were raised to 700 mil tons from a peak of about 650 mil tons in recent years.

• The state of Georgia’s Agriculture Commissioner on Tuesday gave a statement indicating the state was now free of bird flu, which meant poultry product exports would be able to resume; no timeline was given for a return to normal operations, with Commissioner Harper adding that this designation should not be confused with an ‘all clear’ and that disease risk is still present. To get the designation, the state had to eliminate the disease on all affected farms and show no new infections over a 28-day period.

• The CME Group announced that new soybean oilshare futures and options contracts would begin trading on the exchange on March 31st, pending regulatory approval. The new contracts will be cash-settled, and will be based on the CME’s soybean oilshare index. Officials say the contracts could potentially serve as a proxy for biofuel demand, as soybean oil is the primary domestic input for biodiesel and renewable diesel in the US.

• All things considered, Trump didn’t offer a lot of newsworthy items in his “State of the Union” address yesterday evening; it wasn’t actually a State of the Union address, but just a televised 100-minute long dictation to a joint session of Congress in which the President claimed that “America is back”, while also adding that its people would likely face “more economic discomfort” in the months ahead.

Other news out of the White House Tuesday included a letter from Ukrainian President Zelensky to Trump illustrating regret over the Oval Office meeting next week, and also indicating a desire to sign the mineral deal that was previously agreed to. On the tariff/trade front, Trump is scheduled to speak with Canadian PM Justin Trudeau today according to ABC, but no details were given as to whether this would be in person or by phone