Good morning!
Quiet, two-sided trade overnight… Soybeans saw relative strength overnight while corn and wheat traded narrowly on either side of unchanged. As of 6:30 a.m. CT, corn is a penny lower to fractionally higher, soybeans are 2 to 3 cents higher and wheat futures are 2 cents lower to 2 cents higher. The U.S. dollar index is around 400 points higher, while front-month crude oil futures are trading near unchanged.
S&P Global raises corn plantings forecast… S&P Global Commodity Insights projected that U.S. farmers would plant 94.3 million acres of corn in 2025, up 800,000 acres from their previous forecast released in January and up 3.7 million acres from 2024. They left their soybean planting forecast unchanged at 83.3 million acres, down 3.8 million acres from last year. The firm lowered its cotton plantings to 10.2 million acres, down 250,000 acres from January, and projected wheat plantings at 46.6 million acres, down 250,000 acres from their earlier forecast.
Oil executives to meet Trump… The heads of more than a dozen oil companies are set to meet with President Donald Trump, expressing gratitude for his pro-energy policies while voicing concerns about market challenges. Industry leaders appreciate Trump’s rollback of costly regulations and support for U.S. oil dominance but worry about his push for lower energy prices, potential tariffs, and economic instability. The meeting, the first of its kind since Trump’s second inauguration, will bring together major players from across the sector, highlighting tensions between industry priorities and Trump’s economic strategy.
Putin vows to pause energy strikes… Russian President Vladimir Putin has agreed to temporarily halt attacks on Ukraine’s energy and infrastructure targets following a two-hour phone call with President Donald Trump, both the White House and Kremlin confirmed. However, Moscow has not committed to a broader ceasefire. While Trump pushed for a 30-day truce endorsed by Ukraine, the agreement only covers energy infrastructure as negotiations continue on other key issues, including a potential maritime ceasefire in the Black Sea. The Kremlin’s statement emphasized Putin’s condition that foreign military aid to Ukraine be halted, though this was absent from the White House’s readout.
White House stands firm on April 2 tariff plan… The White House reaffirmed its intent to impose reciprocal tariffs on April 2, despite Treasury Secretary Scott Bessent suggesting that some levies might be delayed. Bessent indicated that tariffs could vary by country and hinted at potential adjustments if nations alter their policies. However, a White House official later clarified that the tariffs will proceed unless tariff and non-tariff barriers are equalized or the U.S. faces higher tariffs.
China expected to expand trade war arsenal… The U.S. is able to use tariffs as an effective negotiation tactic with China due to heavy imports of Chinese goods. China only imports about a third of what they export to the U.S., so they may resort to more creative trade barriers. A Reuters report noted Beijing’s blocking of soybean and lumber shipments, allowing import licenses to lapse for pork, poultry and beef and antitrust probes launched on Google and Nvidia earlier this year as examples of more non-traditional negotiation tactics. China could still manipulate exchange rates or block exports of rare metals necessary to manufacture U.S. goods if tensions continue to escalate.
China lifts ban on Argentine poultry imports… China’s customs authority said today it has lifted a ban on poultry imports from Argentina, according to a Reuters report. Imports from Argentina were suspended in February 2023 following detection of Highly Pathogenic Avian Influenza in commercial poultry. The lift on the imports ban comes in the wake of China limiting poultry imports from the U.S.
Fed meeting concludes today… The Federal Reserve is expected to keep the federal funds rate unchanged at 4.25-4.5%, extending the pause in its rate-cut cycle that began last September. Policymakers are likely to adopt a cautious stance amid persistent economic uncertainty, particularly regarding trade and fiscal policies under the Trump administration. Alongside the rate decision, the Fed will release updated economic projections for GDP growth, inflation, unemployment, and interest rates. These forecasts are expected to indicate slightly higher core inflation and a modest slowdown in economic growth.
Bank of Japan kept rates steady… The Bank of Japan (BoJ) kept its key short-term interest rate at around 0.5% during its March meeting, maintaining it at its highest level since 2008 and in line with market expectations. The unanimous decision followed the central bank’s third rate hike in January and came before the U.S. Federal Reserve’s rate announcement. The board took a cautious stance, focusing on assessing the impact of rising global economic risks on Japan’s fragile recovery. The BoJ pointed to ongoing uncertainties in the domestic economic outlook amid higher U.S. tariffs and headwinds from overseas conditions.
Wage growth in Eurozone slows… Wages in the Eurozone rose 4.1% year-over-year in the final quarter of 2024, the smallest increase over the course of the year. That was down from a 4.3% rise in Q3. Wages eased in France, Spain and Belgium but increased in Germany, the areas leader for GDP growth. Caution regarding a global slowdown due to heightened trade barriers are likely leading employers to be more cautious.
RFK Jr. suggests new bird flu strategy… U.S. Health Secretary Robert F. Kennedy Jr. has suggested allowing bird flu to spread in poultry flocks rather than culling infected birds, aiming to identify immune birds. RFK Jr. argued on Fox News that allowing the virus to spread would help “identify… and preserve the birds that are immune to it.” Supported by USDA Secretary Brooke Rollins, this approach has drawn sharp criticism from some scientists who warn of potential virus mutations, risks to humans, and economic fallout. With over 162 million birds culled and 70 human cases reported since 2022, concerns about food supply disruptions and rising costs remain high.
Wholesale beef prices work higher… Choice cutout continues to climb in the wake of strong cash cattle prices last week. Choice rose $2.16 on Tuesday to $323.32, the highest level in over a month. Select rose $1.33 to $309.23. Cash cattle trade remains abysmal so far this week and will likely continue that way until Friday, given this week’s Cattle on Feed Report from USDA.
Pork cutout continues choppy action… Pork cutout fell $2.01 to $95.64 Tuesday, led by a $10.88 drop in primal bellies. Movement fell to 259.78 loads, indicating relatively weak demand despite lower prices. The CME lean hog index did bounce 4 cents to $89.32.
Overnight demand news... Jordan issued a tender to buy up to 120,000 MT of wheat.
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Today’s reports
- 9:30 a.m. Weekly Ethanol Production — EIA
- 1:00 p.m. FOMC Meeting Concludes — FED
- 2:00 p.m. Broiler Hatchery — NASS