Good morning!
Grains firmer overnight... Corn, soybeans and wheat posted corrective gains during the overnight session. As of 6:30 a.m. CT, corn futures are trading 1 to 3 cents higher, soybeans are 6 to 8 cents higher and wheat is 4 to 8 cents higher. The U.S. dollar index is up around 125 points and front-month crude oil futures are trading just below unchanged.
Canada hits back with $21 billion in tariffs on U.S. goods... Canada announced new 25% counter-tariffs on approximately C$30 billion ($20.8 billion) worth of U.S.-made goods in direct response to the Trump administration’s global levies on steel and aluminum. The Canadian tariffs, which started at 12:01 a.m. ET Thursday, will hit steel products worth roughly $8.7 billion (C$12.6 billion), aluminum products worth $2.08 billion (C$3 billion) and $9.85 billion (C$14.2 billion) of additional imported U.S. goods. Canadian officials emphasized that the measures mirror the U.S. tariffs “dollar for dollar.” Foreign Minister Mélanie Joly criticized the U.S. tariffs as “unjustified and unjustifiable” and plans to discuss the issue with U.S. Secretary of State Marco Rubio at the upcoming G7 foreign ministers’ meeting.
Trade talks today as Canada seeks tariff relief... Canadian officials, including Finance Minister Dominic LeBlanc, Innovation Minister François-Philippe Champagne, and Ontario Premier Doug Ford, are set to meet today with U.S. Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer. The discussions will focus on persuading the U.S. to drop tariffs on Canadian goods, particularly steel and aluminum, along with potential updates to the U.S.-Mexico-Canada Agreement and efforts to prevent further tariff escalations ahead of the April 2 deadline for U.S. reciprocal tariffs.
Trump defends tariff shifts as ‘flexibility’ amid market jitters... President Donald Trump on Wednesday rejected claims that his shifting tariff policies reflected inconsistency, instead arguing they demonstrated “flexibility.” Trump defended his recent exemptions and delays, particularly for auto parts from Mexico and Canada, after pressure from U.S. automakers. “There’s no inconsistency,” Trump said. “I have the right to adjust.” His tariff strategy has unsettled financial markets, with traders wary of its unpredictability. Trump reaffirmed that April 2 would mark a major step in imposing reciprocal tariffs on nations levying duties on U.S. goods.
Weekly Export Sales Report out this morning... For the week ended March 6, traders expect:
| 2024-25 expectations (in MT) | Last week (in MT) | |
| Corn | 725,000-1,400,000 | 909,050 |
| Wheat | 275,000-650,000 | 338,703 |
| Soybeans | 275,000-700,000 | 352,883 |
| Soymeal | 190,000-400,000 | 236,578 |
| Soyoil | 40,000-75,000 | 54,837 |
China expects record soybean imports in second quarter... China is poised to receive record soybean imports in the second quarter after delayed Brazilian shipments and slow customs clearances have caused supply tightness that forced several processors to halt operations. China is forecast to import a record 31.3 MMT of soybeans from April to June, according to a Reuters survey, up 1.39 MMT (4.6%) from the same period last year. According to data from China-based consultancy Mysteel, soybean inventories at Chinese ports shrank to 4 MMT as March 7, a decrease of 600,700 MT from the previous week and down 892,500 MT from last year. Tight supplies have driven crush margins in processing hub of Rizhao to more than 450 yuan ($62.19) per metric ton.
Exchange lowers Argentine soybean, corn crop forecasts... The Rosario Grain Exchange cut its Argentine crop estimates due to impacts from heat and dryness stress. The exchange forecasts soybean production at 46.5 MMT, down 1 MMT from its prior outlook. It cut the Argentine corn crop estimate 1.5 MMT to 44.5 MMT.
IKAR further reduces Russian wheat export forecast... IKAR consultancy lowered its 2024-25 Russian wheat export forecast another 1.5 MMT to 41 MMT. The consultancy said exports could reach 42.5 MMT under a best-case scenario or fall to 38.5 MMT under a worst-case outcome – depending on the ruble and export price fluctuations.
Schumer vows to block GOP shutdown prevention plan... Senate Minority Leader Chuck Schumer (D-N.Y.) stated that Democrats will block a Republican bill aimed at preventing a government shutdown, urging the GOP to support a Democratic proposal for a 30-day interim funding measure instead. With 60 votes needed to advance legislation in the Senate and Republicans holding only 53 seats, Schumer asserted the GOP lacks the votes to push their bill through. Senate Majority Leader John Thune (R-S.D.) filed cloture on the House-passed continuing resolution Wednesday night, the first step in bringing this partisan showdown to a head. Thune set up a cloture vote for Friday. A time agreement would be necessary in order to avert at least a temporary shutdown. Bottom line: Democrats face a choice between a largely symbolic compromise or a risky shutdown that could backfire. While they hold some leverage due to the ticking clock, Republicans appear willing to let the shutdown happen, betting that Democrats will eventually fold.
China’s central bank vows appropriate and timely measures to ensure liquidity... The People’s Bank of China (PBOC) said it would cut interest rates and the bank reserve requirement ratio at the appropriate time to maintain ample liquidity. PBOC also vowed to strengthen guidance on expectations and drive the lowering in social financing costs.
Euro zone industrial production better than expected in January... Industrial production in the euro zone grew 0.8% on a monthly basis and was unchanged annually during January, both topping expectations. This is the first time since April 2023 euro zone industrial production hasn’t contracted versus the previous year.
IEA flags trade war risks to global demand... The International Energy Agency (IEA) warned that global oil consumption is under pressure from an escalating trade war. Global oil supply is likely to exceed demand by about 600,000 barrels a day this year, IEA said. “The macroeconomic conditions that underpin our oil demand projections deteriorated over the past month as trade tensions escalated between the United States and several other countries,” the Paris-based agency said. The flurry of tariffs has “tilted macro risks to the downside.”
Study reveals widespread H5N1 infection in cattle... A new study indicates the H5N1 highly pathogenic avian influenza (HPAI) virus is more prevalent in dairy cows than previously reported. Scientists have identified a concerning genetic mutation, PB2 E627K, in four dairy cow herds nearly a year after the virus was first detected in Texas cattle. This mutation, linked to increased mammal-to-mammal transmission, was also found in the first human case — a Texas dairy worker — last March. The outbreak has led to 70 human infections and one fatality. Since the initial cases, nearly 1,000 dairy herds have been affected, with California reporting the highest number of infections.
Slow start to cash cattle trade... So far, only light cash cattle activity has been reported in Kansas at $200.00, roughly steady with week-ago. With the strength in cattle futures, most feedlots continue to hold out for higher prices, though packers remain reluctant to raise bids given highly negative margins.
Cash hog index ends skid... The CME lean hog index is up 7 cents to $89.77 as of March 11, ending a five-day price slide. The pork cutout fell $3.00 to $94.58 on Wednesday, led lower by a $13.25 decline in primal bellies. April lean hog futures finished Wednesday $3.27 below today’s index quote.
Overnight demand news... South Korea purchased a total of 262,000 MT of corn in three separate tenders – 132,000 MT to be sourced from the U.S., South America or South Africa, 65,000 MT to be sourced from the U.S. or South America and 65,000 MT optional origin. South Korea also tendered to buy up to another 140,000 MT of corn to be sourced from the U.S., South America or South Africa. Bangladesh tendered to buy 50,000 MT of optional origin non-basmati parboiled rice.
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
- 7:30 a.m. Weekly Export Sales — FAS
- 11:00 a.m. Cotton and Wool Outlook: March 2025 — ERS
- 11:00 a.m. Feed Grains Database — ERS
- 11:00 a.m. Oil Crops Outlook: March 2025 — ERS
- 2:00 p.m. Feed Outlook: March 2025 — ERS
- 2:00 p.m. Wheat Outlook: March 2025 — ERS
- 2:00 p.m. North American Grain and Oilseed Crushings — NASS
- 2:00 p.m. Slaughter Weekly — NASS