4.25.25 Tredas Weekly Recap

Weekly Action:

May25 Corn down 5.25 at $4.7725

May25 Beans up 14 to $10.4975

May25 KC Wheat down 18.5 at $5.3775

June25 Hogs up $10.6 to $101.05

June25 Fats up $4.275 to $208.3

May25 Feeders up $3.75 to $290.65

Dec25 Corn down 11.25 at $4.55

Nov25 Beans up 2.5 to $10.3425

July25 KC Wheat down 18.25 at $5.5075

Grains:

Grains were mixed throughout the week as traders continued to monitor tariff talk, good exports sales, and weather. Some timely rains tried to ease the drought in the west, which put some early pressure on the markets, but key technical levels are holding for the moment. First-notice for May futures will be Wednesday, 4/30 and there has been roughly 7c of carry from May corn to July corn. We would note that the July to September corn spread is a ~38c inverse, so it will be prudent to trade some decent basis levels over the next month to clean up old crop bushels.

Planting progress has been moving along, and there are no concerns there for the market. Wet weather across the western corn belt has put a halt to planting in sparse areas, but low soil moisture has soaked up this precipitation in many areas and allowed many to keep on rolling. AgResource has been providing updates in this scene.

Corn:

We came into the week with corn at a point of technical strength. It was key on Wednesday that corn went below the 100-day moving average and closed above it with a move higher into the rest of the week. The funds have started to rebuild a long position in corn. Managed money players have slightly decreased their long positions in corn, down to 112k contracts.

Soybeans:

Thursday, beans traded over the 4/14 high and for the week finally moved over the 200-day moving average, which would be a constructive sign. May beans closed at their highest price since late February. Old-crop and new crop spreads are widening, with the July-November spread currently at a ~24c inverse. Reported US export sales for the week saw soybean exports fall to a 30-week low. Managed money firms have increased their long positions to 31k in beans.

Livestock:

The cattle market continued to surge higher this week on strong cash markets, trading right around $340 dressed. With the market back to highs, keep an eye out for signs in the cash market and boxed beef. It is widely known that supply numbers are tight, but with this knowledge, paired with markets this high and extreme fund length, any ripple in the market could take things the other way. It was noted that some Walmart stores have begun locking up beef, similar to cosmetic products, due to theft. Jack in the Box is closing over 200 stores, and many restaurants are starting to feel the pain.

Weather:

The drought monitor still shows concern in the western corn belt and will need continued rain to ease these concerns. There is quite a bit of talk of a possible warm and somewhat dry summer, so that will have to be monitored later in the spring as the current weather is keeping any concern at bay. A majority of the corn belt looks to see only light rains into mid-next week, meaning planting should remain steady throughout the weekend into early next week.

Economy:

Following weeks of turbulent trade, the economy seemed to find its footing this week. Stocks were mostly positive on gains throughout the week, highlighting the resilience of the US market amidst trade/tariff conflicts. Technical indicators show many indices and individual stocks moving towards strength after floating around in neutrality for nearly 3 weeks. On Monday the 21st, the US Dollar Index put in a 3-year low at 97.921 cents and has since moved back towards 100 cents. This index is a strength test of the US dollar, where higher values showcase higher US trade strength and higher purchasing power, and lower values meaning other countries can buy US goods for “cheaper.”

India and the US are nearing the signing stage of a wide trade agreement, spanning 19 categories and including more US farm goods. Currently, India has non-tariff restrictions on GMO importation, and it appears the current administration is pushing to have these barriers softened. The likely outcome would include India purchasing US corn for ethanol production, and wheat and vegetable oils at a higher volume for human consumption purposes. According to AgResource, India is pledging to increase US trade from $127.6B from 2024 to over $500B in 2030. Other trade agreements expected in the coming days include South Korea and Japan.

US home sales have fallen 5.9%, marking the slowest movement in real estate in 6 months. By looking at this chart below, we can assume that without the massive government stimulus due to the COVID pandemic, we would have been in a recession since 2021.

Something That Probably Means Nothing:

Canadians say “sorry” so much that a law was passed in 2009 declaring that an apology can’t be used as evidence of admission to guilt. The Ontario Apology Act, 2009 was passed and aims to ensure that apologies are not used as evidence of guilt in civil or administrative proceedings. The law states that an apology, made by or on behalf of a person, does not constitute an admission of fault or liability.

Quote of the Week:

“Minds are like parachutes, they only function when open.” – Thomas Dewar, 1st Baron Dewar

Have a great weekend!