Good morning!
Corn higher, beans and wheat lower to open the week... Corn futures rebounded from earlier losses to trade slightly higher early this morning, while soybeans and wheat are under pressure. As of 6:30 a.m. CT, corn futures are trading around a pennyhigher, soybeans are mostly 2 cents lower and wheat futures are 2 to 6 cents lower. The U.S. dollar index is around 425 points higher and front-month crude oil futures are about 50 cents higher.
Trump administration shifts strategy on HPAI... The Trump administration is rolling out a new strategy to combat highly pathogenic avian influenza (HPAI), moving away from mass culling of infected flocks. Spearheaded by National Economic Council Director Kevin Hassett and USDA Secretary Brooke Rollins, the plan prioritizes enhanced biosecurity measures and medication to control the spread of the virus. Targeted containment methods will enhance efficiency in preventing outbreaks, with government scientists and global academic experts contributing to the plan’s development. The plan’s success hinges on industry adoption and global trade acceptance. Balancing effective disease control with maintaining poultry exports remains a critical challenge for the administration.
Cordonnier lowers Argentine crop forecasts... South American crop consultant Dr. Michael Cordonnier cut his Argentine soybean and corn production forecasts by 1 MMT each to 48 MMT and 46 MMT, respectively, due to irregular rainfall across the country, high temperatures and a continued decline in crop conditions. He maintains a neutral to lower bias toward both crops. Cordonnier kept his Brazilian crop forecasts at 171 MMT for soybeans and 123 MMT for corn. Given drier weather across central Brazil, he is less worried about delays with soybean harvest and safrinha corn planting.
Brazil’s soybean harvest, safrinha corn planting ramp up but still lagging... Brazil’s soybean harvest reached 23% done as of last Thursday, according to AgRural, with notable progress in Mato Grosso. Harvest remained well behind 32% on this date last year. Safrinha corn planting jumped 16 percentage points to 36% as producers worked to get as much seeded before the ideal window closes, though the pace remained far behind last year’s 59% at this time.
Modest slowdown in NOPA soy crush expected... Analysts expect the National Oilseed Processors Association (NOPA) will report January soybean crush slowed to 204.5 million bu., down 1% from the all-time record in December but up 10.1% from year-ago. At that level, crush would be a record for the month and the second highest monthly figure behind December 2024. Soyoil stocks are expected to rise to 1.289 billion pounds.
NCC forecasts sharp drop in cotton acreage... A National Cotton Council (NCC) survey showed U.S. producers intend to plant 9.6 million acres to cotton this year, down 14.5% from last year. Harvested area is estimated at 7.8 million acres, with an abandonment rate of 18.4%. This is expected to result in a cotton crop of 13.9 million bales, including 13.5 million bales of upland and 392,000 bales of ELS.
EU plans stricter food import restrictions over pesticide use... The European Union is planning to pursue new restrictions on imported food products treated by pesticides banned in the bloc to address farmers’ complaints about the stricter standards they face in an increasingly competitive global market. The European Commission “will establish a principle that the most hazardous pesticides banned in the EU for health and environmental reasons are not allowed back to the EU through imported products,” according to a draft document to be published Wednesday. The commission plans to avoid blanket bans and proceed on a case-by-case basis when deciding about toxic pesticide use, taking into account market realities and the country of origin, an EU official told Bloomberg. It will launch an impact assessment this year to consider the effects of any decision on the EU’s competitive position and the international implications, including compliance with World Trade Organization rules. The Financial Times reported earlier the EU is trying to block imports of some food items, possibly including U.S. crops like soybeans. An EU official said the proposal won’t target any product or country, and that the impact assessment will take into account the EU’s strategic interests and its competitiveness. The commission will develop a plan to address these challenges to come up with “a more self-sufficient and sustainable EU protein system, while at the same time diversifying imports,” the document said.
India trade body calls for broken rice exports amid record stocks... India needs to allow the export of 100% broken rice after inventories reached a record at the start of February, nearly nine times the government’s target, exporters told Reuters. India banned exports of 100% broken rice in September 2022 and then imposed curbs on exports of all other rice grades in 2023. The Rice Exporters’ Association has requested the Ministry of Commerce and Industry to lift the ban on 100% broken rice exports to reduce domestic stocks, allow poor African countries to secure the grain at lower prices, as well as support Asian animal feed and ethanol producers that rely on those supplies.
Indonesia conducting studies to implement B50 in 2026... Indonesia is studying the implementation of a biodiesel blend that contains 50% palm oil in 2026 and is also looking at a 3% blend for jet fuel next year, an energy ministry official told the country’s parliament. Indonesia is in the process of fully implementing the mandatory mix of palm oil in biodiesel to 40% (B40) from 35% to reduce reliance on imported diesel fuel.
The week ahead in Washington... USDA Secretary Brooke Rollins will speak today at a Top Producer Summit in Kansas City. The House is on recess, while the Senate is in session and will hold additional hearings and votes for President Trump’s Cabinet and leadership positions. The release of Fed minutes from its last monetary policy meeting on Wednesday afternoon will be the key economic event of the week. USDA will release its long-term baseline projections through 2034 today. These are baseline projections used for budgetary purposes and not USDA’s current outlook for the 2025-26. USDA will release its Cattle on Feed Report Friday afternoon.
Thousands of federal workers fired... The Trump administration has fired thousands of federal employees across various agencies, though the White House has not disclosed an official tally. Agencies have until 8 p.m. ET tomorrow to fire probationary workers, though some exceptions may be made. Roughly 200,000 probationary workers — those employed for less than one to two years — could be affected. Dismissals follow 75,000 deferred resignations linked to Elon Musk’s Department of Government Efficiency (DOGE) initiative. While most affected employees are probationary or term-limited, some permanent civil servants have also been let go. Workers from USDA, EPA, IRS and the Consumer Financial Protection Bureau have reported terminations or received notices, with more expected.
DOGE reportedly reviewing agricultural checkoff programs... DOGE is reportedly actively reviewing commodity checkoff programs as part of its broader initiative to evaluate and potentially reform agricultural policy and spending. USDA’s Agricultural Marketing Service oversees 22 checkoff programs, which vary in legal authority and regulatory structure. Some operate under commodity-specific statutes, while others fall under the Commodity Promotion, Research and Information Act of 1996. State-level checkoff programs also exist, often independently from federal programs. While specific details of its investigation remain unclear, several factors indicate these programs are under review. Since Jan. 20, USDA has been reassessing contracts, personnel and programs, likely including checkoff programs. A policy initiative, Project 2025, has recommended USDA stop approving new checkoff requests and work with Congress to either eliminate the 22 existing programs or require periodic producer votes to maintain them (referendums have been held over the years). While DOGE cannot directly change checkoff policies, its recommendations may influence legislative efforts. Given the controversial nature of checkoff programs, any proposed changes would likely face both support and opposition from different agricultural groups.
Canada reports HPAI outbreak in backyard flock... Canada has reported an outbreak of highly pathogenic H5N5 avian influenza on a non-commercial backyard layer poultry farm in the eastern part of the country, the World Organization for Animal Health (WOAH) said. Analysis of the H5N5 virus detected in Canada’s Newfoundland and Labrador province showed it was similar to the H5N5 one which hit Canada in 2023, the Paris-based WOAH said. It also showed that it was related to the H5N1 (2.3.4.4b) lineage that has affected some farms in Canada and has been spreading in other parts of world, mainly in the United States and Europe.
Cash cattle weaken... Cash cattle averaged $202.91 last week, down $4.14 from the previous week and the second straight weekly decline. Given highly negative packer margins that have caused packers to slow slaughter runs, cash cattle prices are expected to weaken again this week.
Cash hog index continues upward path... The CME lean hog index continues to rebound off the seasonal low posted in early January, with the latest quote as of Feb. 13 at $88.77, up 71 cents. April lean hog futures, which took over as the lead-month contract on Friday, hold a $3.83 premium to the cash index.
Holiday weekend demand news... Saudi Arabia purchased 920,000 MT of optional origin wheat, of which the bulk is expected to be sourced from the Black Sea region. Taiwan tendered to buy up to 65,000 MT of corn from the U.S., Argentina, Brazil or South Africa. Japan is seeking 96,160 MT of milling wheat via its weekly tender.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
- 10:00 a.m. Weekly Export Inspections — AMS
- 11:00 a.m. Monthly Soybean Crush — NOPA
- 2:00 p.m. Livestock, Dairy, and Poultry Outlook: February 2025 — ERS
- 2:00 p.m. Sugar and Sweeteners Outlook: February 2025 — ERS
- 2:00 p.m. USDA Agricultural Projections to 2034 — ERS
- 2:00 p.m. Chickens and Eggs - Annual — NASS