USDA Acreage Guess, $100 Crude, $5.45/gal Diesel

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🌱 Farmers Ditch Corn for Soybeans — Here's Why It Matters
The Iran war is reshaping American agriculture. With urea prices up 40% and fuel costs surging, US farmers are pivoting—corn acreage is set to fall 4.5% while soybeans climb 5.2%. Spring wheat? On track for its lowest plantings since 1970. 📉
Meanwhile, soybean oil is surging 🛢️, crude oil hit $102/barrel for the first time since 2022, and the Strait of Hormuz crisis is keeping energy markets on edge.
All eyes are on today's USDA Prospective Plantings & Quarterly Grain Stocks report at 11am CST—the stocks numbers could be the real market mover. 👀📊
#Farming #Commodities #CornMarket #Soybeans #CrudeOil #USDA #AgMarkets #GrainMarkets

Transcript

Acreage/Stocks Report Today

SPEAKER_00 0:00

Yes, the surveys were going out in early March as the Iran situation was unfolding, as fertilizer prices were spiking. There are a lot of questions here. Uh, we've had a lot of debate on the show and in the comment section about just what exactly was locked up in terms of uh nitrogen needs in particular as it relates to corn prior to Iran. Some of our sources have said it's like, you know, 80% of the nitrogen was locked up, and other people are telling me, Joe, it's it was like half. So I guess maybe we'll find out something about that today. I don't know. I just don't know that the acreage numbers are really gonna mean a whole lot. I'll tell you what though, I think that the algorithms will act as if the acreage numbers mean something, even if they don't. We know that USDA has got a pretty bad track record, especially the last couple of years with the acreage numbers. But I think that if if the acreage numbers come out well above or well below the average trade guess, you're gonna see the the market trade this stuff for sure. And maybe it'll be short-lived. I don't know. The more tangible piece of this report would be the grain stocks report. Grain stocks as of March 1st, uh, corn stocks in particular expected to be almost a billion bushels larger than they were last year. Um, you could see some movement based on this, and this is the lesser discussed item, but uh this may be actually the more meaningful data set. It's a little bit more tangible. You can kind of hang your head on this stuff, whereas the acreage numbers, you don't really get a feel for this until June. I will say this uh people have asked me, like, hey, Joe, what is what does the market typically do after the report? Or how does the market act? The row crop markets tend to hold together in the weeks following this report and oftentimes even move higher. And it doesn't have anything to do with the report. The the tendency of the markets to move higher following this report has more to do with just general like US growing season and market patterns. So when we get into you know early April, the market through planting for the most part and into a little bit of June, the markets are gonna hold on to some risk premium and some weather premium until we know a little bit more about the crop. You know, even if we even if we know the acreage numbers, we still don't know what the weather is gonna be. So the market kind of typically holds together corn and soybeans, and not every year is a seasonal year. We know that from the last couple of years, but in a normal year, the markets will hold up fairly well until you get into like mid-June. And then you start to get a feel for weather, you start to get a feel for acres. And in a normal year, you don't have a weather problem. And that's why July, September, October, you know, typically are bad months because we figure out the acres, we figure out, hey, the crop's not going to be a disaster, and we sell off. So that's just a little bit of food for thought. It of course does not have to work that way this year. We've got a lot of irons in the fire here with the Siran thing and the fertilizer situation. Um, anything could happen. Soybean oil futures surged yesterday with the May 26th contract gaining roughly 1%, settling just below an early March peak.