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Followthrough buying in grains overnight... Corn, soybeans and wheat built on Wednesday’s corrective gains during overnight trade. As of 6:30 a.m. CT, corn futures are trading mostly 1 to 2 cents higher, soybeans are 5 to 8 cents higher and wheat is 1 to 3 cents higher. The U.S. dollar index is down around 225 points and front-month crude oil futures are about 50 cents higher.
Trump weighing tariff exemptions for ag products... President Donald Trump is considering exempting certain agricultural products from tariffs imposed on Canada and Mexico, with USDA Secretary Brooke Rollins telling Bloomberg “everything is on the table.” Rollins specifically mentioned potash and fertilizer as examples of products that could potentially receive exemptions. Government data shows at least 90% of potash consumption volume in the U.S. is fed by imports, with 80% of all potash coming from Canada. Additional products that might be considered for exemptions include nitrogen, other fertilizers, seed and farming equipment, all mentioned by House Ag Chair Glenn “GT” Thompson (R-Pa.) as products he’s pushing for exemptions. The Trump administration is still in the process of deliberating which ag products might receive relief from tariffs, with considerations part of a broader effort to mitigate the potential negative impacts on the U.S. agricultural sector.
Weekly Export Sales Report out this morning... For the week ended Feb. 27, traders expect:
| 2024-25 expectations (in MT) | Last week (in MT) | |
| Corn | 700,000-1,000,000 | 794,694 |
| Wheat | 225,000-450,000 | 269,008 |
| Soybeans | 300,000-550,000 | 410,878 |
| Soymeal | 150,000-400,000 | 176,472 |
| Soyoil | 20,000-45,000 | 18,363 |
Thai business group urges U.S. trade policy ‘war room’ but also more ag imports... The Thai Chamber of Commerce said it is concerned about U.S. trade policy and asked the government to establish a special working group and a “war room” to address related issues. But the chamber also said Thailand needs to import more American ag goods to reduce its trade surplus with the United States.
COFCO: China expecting another bumper wheat crop, reduced imports... China is expecting to produce another bumper wheat crop this year due to favorable weather, a COFCO International executive said, with rising domestic supplies likely to reduce the need for imports. Duan Chen, associate hedging manager with COFCO International, said China’s winter wheat crop is stable and strong production is expected under normal weather, without providing a specific estimate. Besides higher output, stagnant consumption has led to excess wheat supplies, which COFCO International expects to grow in 2025-26.
India’s wheat production set to stay flat, keeping stockpiles tight... India’s wheat production is expected to be little changed from year-ago at 106 MMT, according to the median of seven estimates in a Bloomberg survey of wheat processors. This is slightly lower than the 110 MMT projected by the Rollers Flour Millers’ Federation of India. Harvesting of wheat has started in areas of central India, but there are concerns rising temperatures in northern production locations will threaten yields of late-planted varieties. India needs imports to ease concerns about low inventories, the president of the millers federation said, suggesting 2 MMT to 3 MMT of imports at a reduced duty into the country’s south was possible.
Mexico’s Congress approves ban of cultivation of GM corn... Mexico’s Senate approved the constitutional reform banning cultivation of genetically modified (GM) corn on Wednesday, a week after the lower House approved the measure. The reform must now be approved by the local legislature of at least 17 of the country’s 32 states. The addition to Article 4 of the constitution specifies that the cultivation of corn “in the national territory must be free of genetic modifications produced with techniques that overcome the natural barriers of reproduction or recombination, such as transgenics. Any other use of genetically modified corn must be evaluated under the terms of the legal provisions to be free of threats to biosafety, health and biocultural heritage of Mexico and its population.” The constitutional amendment made no reference to corn imports.
Top-line spending deal imminent, but stopgap debate continues... Lawmakers are close to a bipartisan top-line funding agreement, with House Appropriations Chair Tom Cole (R-Okla.), House Appropriations ranking member Rosa DeLauro (D-Conn.) and Senate Appropriations Vice Chair Patty Murray (D-Wash.) signaling an announcement is near. However, debate continues over a stopgap measure to extend funding beyond March 14, with House Republicans planning to propose a stopgap through Sept. 30. Democrats prefer a shorter extension to complete appropriations work. A potential House vote on a full-year stopgap could shift leverage to Republicans, as hard-line conservatives weigh support in line with President Trump’s agenda.
Beef and pork exports bolster corn, soybean markets... In 2024, U.S. pork and beef exports reached $19.1 billion, bolstering the corn and soybean industries despite a challenging year for producers. An independent study by the Juday Group, released by the U.S. Meat Export Federation (USMEF), highlighted that beef and pork exports contributed $2.24 billion to corn, $525 million to distiller’s dried grains with solubles (DDGS) and $1.12 billion to soybeans. The study emphasizes how red meat exports drive value back to producers, with beef and pork exports accounting for 525.1 million bu. of corn and 100.7 million bu. of soybeans used in 2024.
Brazilian beef’s potential reentry poses challenge to U.S. in Japanese market... Brazil is negotiating with Japan to restart beef exports after a ban in 2012 due to Bovine Spongiform Encephalopathy (BSE). According to Southern Ag Today (link), despite Brazil’s previous negligible market share, its return could disrupt U.S. beef exports to Japan, a vital market where U.S. beef currently leads with 43% of total imports. Brazil’s robust export capacity may enable it to compete in Japan, particularly if it can match the quality of U.S. beef.
Cattle signaling short-term lows... Cattle futures have bounced back from the recent long liquidation plunge driven by trade war concerns with strong gains the past two days. Yesterday’s close in April live cattle was the highest since Feb. 10. While the lead contract still holds a roughly $1.00 discount to last week’s average cash cattle price, price action the past two days suggests the panic selling has subsided for now.
Wholesale pork prices continue to chop... The pork cutout fell $1.29 to $96.48 on Wednesday, continuing the recent choppy price trend. Since mid-February, cutout has chopped broadly within a range from $94.03 to $102.47, with big swings in primal bellies largely driving the volatility.
Overnight demand news... South Korea purchased 98,200 MT of milling wheat, including 50,000 MT U.S. and 48,200 MT Canadian, and tendered to buy up to 140,000 MT of corn to be sourced from the U.S., South America or South Africa. Thailand purchased 67,000 MT of optional origin feed wheat, likely to be sourced from the Black Sea region.
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
- 2:00 p.m. Slaughter Weekly — NASS