Written Commentary
SOYBEANS
The soy complex is extending its gains from late last week ahead of this morning’s Quarterly Stocks and Prospective Plantings reports, boosted by anticipation of a significant drop in planted acreage. This report typically sets the stage for spring markets and can clarify how much cushion the market will have for weather issues this season. The anticipated drop in bean acreage suggests the heightened importance of the US growing season. There will be no shortage of market-moving news this week with the end of month and end of quarter today, the USDA report, NASS February crush, and reciprocal tariff decisions on Wednesday. Today’s report is expected to show bean stocks at 1.901 billion bushels, up from 1.845 billion a year ago, and acreage is expected at 83.76 million, down from 87.05 million a year ago.
SOYBEAN MEAL
Traders are awaiting the USDA’s Quarterly Grain Stocks and Prospective Plantings reports later this morning. US soy acreage is expected to drop 3.3 million acres from last season, heightening the market’s sensitivity to any adverse weather issue this season. Yet, new western soy processing plants could blunt acreage losses, especially west of the Mississippi River, as strong bids may entice farmers to plant beans. NASS crush will be released Tuesday afternoon, and the pre-report estimate is 188.6 million bushels, down 2.5% from last year.
CORN
The corn market is holding steady this morning ahead of today’s USDA report, and prices rebounded and closed higher after the weak start last Friday. Today, quarterly stocks are estimated at 8.151 billion bushels, down from 8.347 billion a year ago. Acreage is expected at 94.4 million acres, up from 90.6 million last season. The whisper number on acres is 95 million or above, and if the report does come out well above the average guess, it will provide an additional cushion for a weather problem this season.
WHEAT
Chicago wheat closed lower each day last week and hit a 7-month low Friday on solid trading volume. Open interest increased by nearly 10,000 contracts. CFTC data indicated funds added to their net short position, which now stands at an 8-week high. Wheat may have the lowest chance of major surprises in today’s Quarterly Stocks and Acreage reports. Stocks are expected at 1.215 billion bushels, up from 1.087 billion a year ago, and all wheat acreage is expected at 46.475 million, up from 46.1 million in 2024.
CATTLE
Live cattle prices were relatively quiet on Friday, and open interest for live cattle and feeders was little changed. Tariffs will be the name of the game this week, and we expect headline risk to remain high as last-minute negotiations continue. Boxed beef cutout was up sharply last week. June live cattle stopped short of hitting a new contract high last week, and the previous week’s reversal high was still under control until the market took out 207.30.
HOGS
June hogs opened on the day’s high Friday after Thursday’s bullish Hogs and Pigs report but closed on the day’s low, which may have been partly due to the stock market selloff Friday. Canada and Mexico tariffs will be an important market factor this week as last-minute negotiations continue for the next couple of days. With sideways action dominating the last few weeks, traders are looking for a breakout above 99.70 or a drop below 94.20 to signal the direction of the next price leg. A tariff deal headline or at least a postponement may result in a bullish reaction.
MILK CLASS III
May Class III milk finished with a moderate weekly gain after climbing up to a 2-week high on Friday.
ENERGIES
May Crude Oil was lower overnight as the market gave back more of its gains from Monday’s breakout rally as it awaits the Trump Administration’s announcement on tariffs this afternoon. There are concerns that a trade war that could pressure oil demand, but expectations vary regarding the level of tariffs that will be announced. Some have suggested the rate could be 20% across the board, which may be a relief after some expectations for 25%. The API report yesterday was bearish for crude and ULSD and neutral for RBOB.
May Natural Gas was slightly higher overnight after a selloff yesterday. The market may have gotten overdone on a colder weather forecast that has emerged this week. The trade also awaits the tariff announcements that afternoon. US is the world’s largest exporter of LNG, and traders fear the high US tariffs could spark retaliation. On the other hand, buying more US LNG could offer nations an opportunity to balance their trade surpluses with the US, which could put them in a position to negotiate for lower tariffs.
DOLLAR INDEX
The U.S. dollar index is lower, which is a sign of weakness for the greenback, when other flight to safety vehicles are higher.
COCOA
May Cocoa broke out of a two-week trading range yesterday and traded to its highest level since March 13, and it extended those gains slightly overnight. The market is being supported by concerns about the west African mid-crop following a dry season that was exceptionally dry. Rainfall has improved recently, but not enough to assuage concerns. The market also has found support at the 200-day moving average after testing that level last month. World Weather Service said yesterday that rains will be erratic in west Africa over the next 10 days.
COFFEE
May Coffee is lower this morning after an outside day higher yesterday. Less than ideal conditions in Brazil continue to support the market despite recent reports that suggested the crop may be better than feared. Overnight World Weather Service indicated said Brazil could see near to below normal rainfall in April. Yesterday they did mention that coffee areas in Sul de Minas, northeastern Sao Paulo and Cerrado Mineiro may experience some improved rainfall Thursday to Saturday, but once again, they don’t expect it to be enough to provide more than a short term break from stressful conditions.
COTTON
Monday’s acreage report was bullish against expectations, but it took a move above the 50-day moving average yesterday to spark a rally. The report showed US 2025 cotton planted area at 9.87 million acres, down from the USDA Outlook Forum estimate of 10.0 million in February and down from 11.2 million for 2024. World Weather Service reports that South Texas and the Texas Coastal Plain saw some flooding last week, but this ended a long period of dryness and could help with future planting, emergence and establishment. West Texas will get some rain late this week, but it is expected to be brief.
SUGAR
May Sugar was lower overnight after a sharp rally yesterday. Brazil rains have been on the light side recently, but the cane crop appears to be in decent shape. World Weather Service expects timely rainfall in the first half of April, but the amounts are likely to be less than usual. Sucrose levels may be a little higher, which could help counter a reduction in tonnage. Brazil’s production 2025/26 production is just getting underway.
PRECIOUS METALS
June gold futures are higher on Wednesday, edging closer to the record highs seen in the previous session. This increase was driven by heightened risk aversion as markets anticipate further U.S. tariffs that could intensify the global trade conflict.
May silver futures are higher and are coming up against a four-day down trend line.
May copper futures are steady on Wednesday after pulling back from record highs reached last week. Traders took profits while awaiting updates on potential U.S. tariffs.
EQUITIES
Stock index futures are lower as trade war concerns continue to dominate investor sentiment in advance of President Donald Trump’s upcoming tariff announcement. Reports suggested he is considering a universal 20% tariff on most imports.
INTEREST RATES
Futures are steady to lower at the front end of the yield curve and are higher at mid-curve and at the long end of the yield curve.
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