Good morning!
Corn and beans mildly firmer, wheat mostly higher this morning... Corn and soybean futures have firmed after light, two-sided trade overnight while wheat is choppy with an upside bias this morning. As of 6:30 a.m. CT, corn futures are trading 1 to 2 cents higher, soybeans are 3 to 4 cents higher and wheat futures are fractionally lower to 3 cents higher. The U.S. dollar index is around 165 points higher and front-month crude oil futures are about 70 cents higher.
Thailand in talks to buy U.S. feed grains amid tariff risks... Thailand’s feed industry is pitching to buy about $2.8 billion worth of agricultural commodities annually from the U.S. instead of other suppliers, as the country seeks to narrow its $35 billion trade surplus and head off possible tariffs on its own exports. Bloomberg reported the Thai Feed Mill Association is in talks with the government to ease some rules to make U.S. feedstuffs like soybean meal and corn more competitive to import. A move to reduce or remove a 2% import tax on U.S. soymeal, potentially via a trade pact, could immediately incentivize Thai feed mills to switch their purchases from Brazil, the head of the Thai Feed Mill Association said. A temporary suspension of WTO-mandated tariffs on corn would also favor supply from the United States, he said. Nearly all of Thailand’s soymeal imports currently come from Brazil, while less than 1% are from the United States. Corn is sourced locally and from Southeast Asian neighbors, while wheat comes from Europe. According to the mill association, the country could switch to buying 3 MMT of soymeal and 4 MMT of corn from the United States. Washington may also pressure Thailand over market access to U.S. pork. Currently, U.S. pork cannot enter Thailand due to local laws banning the use of feed additives commonly used in American livestock production.
Brazil challenges U.S. on ethanol tariffs, cites sugar trade barriers... Brazil is pushing back against the Trump administration’s complaints about ethanol tariffs by highlighting the lack of reciprocal access for Brazilian sugar in the U.S. market. Brazilian officials argue that any discussion of fair trade should include addressing the high tariffs and quotas on Brazilian sugar exports to the United States. But U.S. interests dispute some of Brazil’s claims, saying tariffs are just one part, with subsidies and nontariff trade barriers in Brazil a key component of its policy framework. Click here to view our special report.
RFA pushes for temporary biofuel tax credit reinstatement... The Renewable Fuels Association (RFA) is urging the reinstatement of expired biofuel tax incentives to provide stability amid uncertainty surrounding the new Section 45Z clean fuel production tax credit. RFA President Geoff Cooper emphasized that bringing back these credits would bridge the gap until the 45Z credit becomes fully operational in 2025. At RFA’s National Ethanol Conference, Cooper highlighted ethanol’s critical role in bolstering the farm economy, advocating for regulatory changes such as year-round E15 sales to boost corn demand. Odds are relatively low for any reinstatement anytime soon because this would be a tax change and that would likely have to be part of a coming reconciliation measure on tax cuts, incentives and other tax-related policy.
Trump plans 25% tariffs on autos, semiconductors, and pharmaceuticals... President Donald Trump announced plans to impose 25% tariffs on auto imports, semiconductors and pharmaceuticals as early as April. The move could significantly impact consumers, with car prices expected to rise by thousands of dollars. The pharmaceutical industry, which saw $176 billion in U.S. imports in 2023, could also face disruptions, with European, Indian and Chinese firms likely to be hardest hit.
U.S./China trade tensions escalate at WTO confab... China condemned President Donald Trump’s tariffs at a World Trade Organization (WTO) meeting, warning that such “tariff shocks” could destabilize the global trading system. Beijing’s remarks were dismissed by Washington as hypocritical, with the U.S. accusing China of violating WTO rules. The discussion, part of the WTO General Council’s agenda, highlighted deep divisions over trade policies, with some nations voicing concern over tariffs while others criticized China’s economic practices. WTO Director-General Ngozi Okonjo-Iweala urged calm, emphasizing the organization’s role in managing trade conflicts. China is willing to strengthen dialog, manage differences with the U.S. to create a fair and predictable policy environment for cooperation between the two countries’ businesses, Minister of Commerce Wang Wentao told Commerce Secretary Howard Lutnick. China reiterated that tariffs imposed by the U.S. cause damage to normal economic and trade cooperation between the two countries and they hope to resolve concerns through equal talks.
Mexico’s Ebrard heads to D.C. for high-stakes trade talks amid rising tensions... Mexico’s Economy Minister, Marcelo Ebrard, will visit Washington, D.C., today through Friday for discussions with U.S. officials, including Commerce Secretary Howard Lutnick. The talks will focus on trade issues, particularly the U.S.-Mexico-Canada Agreement (USMCA) and broader economic integration. Analysts warn that escalating tensions could lead to a trade war and economic downturn in Mexico. Ebrard aims to clarify U.S. trade policies, promote Mexico’s “Made in Mexico” initiative, and strengthen economic ties while avoiding conflict. Discussions will cover tariff impacts, trade relations (which exceeded $800 billion last year) and strategies for economic collaboration.
U.S./Russia talks on ending Ukraine war begin... The U.S. and Russia will appoint high-level teams to negotiate an end to the war in Ukraine and are working to re-establish diplomatic channels, Secretary of State Marco Rubio announced Tuesday. The talks, which excluded Kyiv, marked the first direct meeting between top U.S. and Russian officials since Moscow’s 2022 invasion. Meanwhile, President Trump criticized Ukrainian President Volodymyr Zelenskyy for rejecting any deal made without Ukraine’s involvement and stated he will “probably” meet with Russian President Vladimir Putin before the end of the month.
China unveils action plan to stabilize foreign capital... China issued an action plan to stabilize foreign investment, including allowing foreign investment companies to use domestic loans for equity investment and guiding foreign capital to invest in China’s services sector. China’s commerce ministry and National Development Reform Commission said foreign investment played a key role in developing the “new productive forces” and “achieving Chinese-style modernization,” according to the plan. China will also promote opening up the biopharmaceutical field and encouraging foreign investment in livestock breeding, feeding equipment production, feed and veterinary drug sectors. In 2024, China’s net foreign direct investment (FDI) dropped a record $168 billion. FDI fell 13.4% from year-ago in January.
UK inflation rises to 10-month high in January... The annual consumer inflation rate in the UK accelerated sharply to 3% in January 2025, up from 2.5% the previous month and the highest since March 2024. Core inflation, excluding energy, food, alcohol and tobacco prices, rose to 3.7% from 3.2% in January – the highest since April 2024.
USDA to maintain Mexican cattle imports despite new screwworm case... USDA announced it will not impose new restrictions on cattle imports from Mexico despite the latest detection of New World screwworm in a cow from Tabasco state. The decision follows the agency’s implementation of a pre-clearance inspection and treatment protocol, which aims to ensure safe livestock movement and mitigate screwworm risks. This comes after a previous screwworm case prompted Washington to halt Mexican cattle shipments in November, exacerbating already tight U.S. cattle supplies. On Feb. 1, USDA’s APHIS announced the resumption of cattle and bison imports from Mexico under a new comprehensive screening protocol. USDA affirmed that its inspection and treatment protocols ensure safe cattle movement into the U.S. amid historically low domestic supplies.
USDA works to rehire FSIS staff amid new HPAI strategy rollout... USDA’s Food Safety and Inspection Service (FSIS) is working to rehire several staff members mistakenly fired over the weekend despite their role in the agency’s response to highly pathogenic avian influenza (HPAI). USDA confirmed efforts to rescind the termination letters but did not indicate similar action for the Animal and Plant Health Inspection Service (APHIS). Meanwhile, USDA is finalizing a new HPAI strategy, focusing on enhanced biosecurity and surveillance measures to curb outbreaks without mass poultry culling. The plan, involving National Economic Council Director Kevin Hassett and USDA Secretary Brooke Rollins, is expected to be reviewed by President Trump before its official release.
Beef packer margins remain highly negative... Cash cattle prices have declined $6.66 over the past two weeks, but Choice boxed beef fell more than $16.00 during that period. As a result, packer cutting margins remain deep in the red, causing them to reduce kill hours in an attempt to manage the red ink amid tight supplies. Cash cattle are expected to decline again this week.
Cash hog index keeps rising, pork cutout drops... The CME lean hog index is up another 70 cents to $90.19 as of Feb. 17, continuing the strong rebound from the early January seasonal low. The pork cutout fell $3.00 to $99.47 on Tuesday, pressured mostly by a $10.25 drop in primal bellies.
Overnight demand news... Taiwan purchased 65,000 MT of U.S. corn. Jordan tendered to buy up to 120,000 MT of optional origin milling wheat.
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
- 8:00 a.m. Food Expenditure Series — ERS
- 11:00 a.m. Fruit and Tree Nuts Data — ERS
- 11:00 a.m. Vegetables and Pulses Data — ERS
- 2:00 p.m. Broiler Hatchery — NASS