Joshua Van Ryswyk

On the Grains On the grains, yesterday’s EIA report showed that ethanol production and ethanol stocks were down, which is not a great sign. It reminds me of our old football coach, who, when asked how our team would be that year, said, “Well, we’re small, but we’re slow,” indicating that his expectations weren’t all that high for that season. Weekly production came in at 292 million gallons, down 8 million from the previous week, while stocks came in at 1,069 million gallons, up 11 million from last week. The production number was the lowest in 53 weeks, which is concerning since we have now had back-to-back declines in a seasonally strong timeframe. Ethanol production has been running strong in the last 8 weeks of data, averaging 2.2% higher than last year. Weekly gasoline demand was relatively steady. However, it was off by .9% from the previous year’s same week numbers. U.S. ethanol exports last week fell to 114,000 barrels, down from 129,000 the prior week, a noticeable decline vs the last 15 weeks, which averaged 138,000 barrels. This content is for members only.Register Already a member? Log in here

Morning Market Talk Eric is feeling under the weather today and there will not be a Morning Market Talk. On the Grains The row crops continue to struggle, considering the 90-degree temperatures and the 30 mph winds blowing across the western corn belt. While V1-V6 water use is relatively low in early growth, I can get behind the theory that the crop isn’t getting mudded in, will be off to a great start, and will undoubtedly be "deep-rooted.” However, the NASA GRACE model below measures the top 1 meter of soil moisture. If the crop gets germinated and up, we could be alright and hit the timely rains. I get a little cringy feeling when I see the center part of the grain belt with very little moisture in the top 1 meter. Those major corn-growing areas need to be produced to have a shot at the 181 BPA national yield. The drought monitor maps will run tomorrow at 7:30 am. Look for traders to watch that closely. Corn and Soybeans are still struggling to attract investment from funds. There are ongoing questions about the WASDE numbers, especially considering the rising demand and increasing exports for the 25/26 crop year.…

On the Grains Yesterday was the fuel, now we need the spark. The USDA/WASDE numbers came out at the low end of the trading range for domestic production (25/26), while exports increased and could rise again in the July report. If there is risk in the July numbers, it’s from lower feed, seed, and ethanol figures. The 50 million export increase feels low, and the USDA is already buffering for decreased ethanol numbers later in the season or holding it in reserve to offset a potential for lower yield if the dryness persists. As a farmer, it seems simple: we don’t grow a bushel of corn, that bushel comes off the carryout, yet history tells us that it’s closer to ½ bushel that comes off the carryout. The USDA is already forecasting record demand, leaving plenty of room for adjustments if needed. Meanwhile, 25/26 global stocks decreased by 10.5 MMT from last year and 21 MMT below the average trade figure. We will post the full report below. This content is for members only.Register Already a member? Log in here

On the Grains Good morning. We know that China and the US have reached a 90-day deal that will slash tariffs to 30%, down from 145%. Meanwhile, goods heading into China will only be hit with a 10% tariff, while the Trump 1.0 tariffs from his first term remain in place. More details will follow as they become available. Equity markets are on fire: DOW is up 927, NASDAQ is up 769, and S&P is up 162. Crude oil is up $1.81, while gold is down $127. This content is for members only.Register Already a member? Log in here

On the Grains Is it possible that we were not forgotten? Yesterday’s trade deal, including zero tariffs on ethanol to the UK, it was a massive win for agriculture. I like where the first deal went, let’s see where the rest of them go. The U.K. uses 1.4 billion liters of ethanol annually. With removing the 19% tariff, U.S. ethanol is expected to become even more competitive against Brazilian and EU producers. The beef deal included is likely a non-factor as they will not adjust policy limiting the use of growth hormones, which the bulk of cattle have here. It’s possible that some small regional plants would open up a program and try to hit that niche market that could potentially provide some margin relief to them, time will tell.  This content is for members only.Register Already a member? Log in here

On the Grains Good morning. Yesterday’s announcement of the US/China meeting to discuss trade gave life to the markets early, but as the day wore on, they faltered. President Trump announced that he wouldn’t lower tariffs for China in a good-faith effort ahead of the meetings.  All markets are in a “show me” mindset and will likely stay there until announcements are made. Even after the announcements, I want to see it and believe it. A United States/United Kingdom agreement is expected to be announced today. While probably not a big deal for agriculture, it outlines what future agreements will look like.     This content is for members only.Register Already a member? Log in here

On the Grains: There have been significant developments in the China/US tariff back and forth as they both agreed to meet in Switzerland on Thursday. Treasury Secretary and U.S. Trade Representative Jamieson Greer are scheduled to meet with Beijing’s delegation. Secretary Bessent stressed that these are preliminary talks and that we are a long way from a deal, let alone a deal China performs on. I apologize for my glass being half empty regarding China, after Trump 1.0. I don’t believe China upholds its portion of any agreement. Again, I worked at the export desk where a “great meeting” occurred just one week before, and we missed export sales by $1 per MMT. Maybe times are different, and this deal will have teeth, yet I remain cautious. China has cut its key rates and reserve ratios to aid its economy, which has been hit by tariffs. China has stated, “The US abuse of tariffs has severely disrupted global economic and trade orders.” It’s hard to take any statement from them about abuse seriously, they have abused their people, land, and other countries in the Belt and Road Initiative.    This content is for members only.Register Already a member? Log in here

On the Grains Planting progress was 40%, within the 35-48% trade range and on the 5-year average. I thought it might be closer to 45%. Last week, we planted 14.7 million acres, which will be crushed as it’s finally opened up in SE Minnesota and Northeast Iowa. 55.7 million acres remain yet to be planted, and we will get everything in the ground promptly this year. Ohio might struggle for another week, but the extended forecast also looks better there. July corn had an ugly day yesterday as we look to make a bottom for the near term, and if the $4.50 holds, we should be good. “While plant in, the dust and the bins will bust” motto still holds true, and traders piled on the short side yesterday as they lacked the motivation to buy the market as the 6-10 day looks good. July support at $4.50 and looks like it should hold as we have done enough damage ahead of the WASDE report, and crude bouncing off 4 years lows yesterday should be supportive ethanol. This content is for members only.Register Already a member? Log in here

On the Grains Let’s take a look at developments over the weekend. First is planting progress, which will likely be in the low 40% tonight. While southeast Minnesota struggles to get much in the ground, it will be a wide open 10 days, and the bulk will get planted. We will keep this short and sweet. The crop is getting in the ground. Funds also expect the corn to get into the ground, noting that they were sellers of 41,000 contracts, leaving them 71,329 long. If we could get a storyline, they could add significant length, yet the time is short for that to develop. Two weeks of good weather and nothing left for a news story but a drought to bring them back to the market, as the demand story feels stale and traded. This content is for members only.Register Already a member? Log in here

On the Grains For all the “fear” of the economy falling to zero, Apple’s earnings yesterday were reported at $95.4 billion, up 5% year-over-year, beating expectations of $1.62/share and paying out $1.65. Apple also announced it will purchase $100 billion in its stock buyback program.  Chinese sales, shockingly, were down 2.3% year-over-year. If an analyst expected them to gain market share in China, I wonder what they think and if the hamster is still running around? Undoubtedly, the concern is the tariffs and how the 2nd quarter numbers look, some might have been preemptive buying ahead of the tariffs supporting numbers last quarter. In my house, we upgraded one phone, an Apple Watch, and AirPods ahead of the tariffs. I believe all three were in January. Not solely based on tariffs, but it did help make the decision easier. The phone and watch were over five years old, and the AirPods I lost are essential in this business. This content is for members only.Register Already a member? Log in here