Daily Market Commentary

03-04-2025

Morning Comments

Tariffs on Mexico and Canada has the futures lower this morning. The new tariffs fueled concern over a potential repeat of a 2018-19 trade dispute between the U.S. and China during the first Trump administration. China retaliated with tariffs on soybeans and several U.S. agricultural products, sending commodity prices tumbling. China will impose additional tariffs of 10% to 15% on certain U.S. imports from March 10, according to a statement from the Chinese finance ministry Tuesday.

The 2018-19 trade dispute hit U.S. soybeans particularly hard. China slashed its purchases of U.S. soybeans and around that time shifted to Brazil as its primary supplier. Soybean futures peaked at $10.70 in early 2018 before falling to just above $8 over the summer.

Near-term price impact for soybeans may be limited since the market was already under pressure from slumping exports and global buyers increasingly turning to Brazil, which is in the process of harvesting what’s expected to be a record crop.

Corn prices continue to show sensitivity to a variety of things, including impending tariffs, large 2025 acreage expectations USDA estimates 94 million acres) and more.. Corn prices faced sizable cuts following a round of technical selling on Monday. Exporters sold 114k metric tons of corn to Mexico for the 24/25 marketing year.

July 2025 corn has fully retraced its decline during 2024—climbing about $1.00 per bushel from its lows scored in August. A collapsing balance sheet (3Billion down to 1.5B), near record low exporter and importer stocks, and questionable emerging weather patterns are working together to put a perfect storm in place for corn to be the leader in 2025. July corn accelerating higher could imply short nearby supply and place even more pressure on producing a high yield in new crop 2025.

Soybean prices continue to be pressured by South American harvest progress, tariff threats and more. Brazilian consultancy AgRural estimated that the country’s current soybean harvest has reached the halfway mark through February 27. That’s up from 39% a week ago and a big ahead of last season’s pace of 48% so far. All eyes are on the southern production state of Rio Grande do Sul, where hot, dry weather continues to limit production potential.

Crop insurance price forecasts used to determine indemnities for the 2025 growing season are the lowest for soybeans since 2020 but up a few cents per bushel for corn compared to last year, Reuters reported Monday, citing USDA data. The USDA's Risk Management Agency set crop insurance base prices at $4.70 per bushel for corn and $10.54 a bushel for soybeans across most of the U.S. Midwest.

OPEC announces it will go forward with April oil output increase

New Crop Corn: Supply – Neutral, Demand – Bullish, Technicals – Neutral-Bearish

New Crop Beans: Supply – Neutral, Demand - Bullish, Technicals – Neutral-Bearish

John R. Anderson

Vice President of Grain

Farmers Union Cooperative

563-380-2311

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