Market to Market - March 21, 2025

Brooke Kohlsdorf: Coming up on Market to Market - 

USDA opens the door to one time payments for crop damage 

Winter tries to hold on as spring rolls into view

Taking an experiment in cover crops to the next level

And commodity market analysis with Mark Gold, next. 

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Announcer: “This is the Friday, March 21, 2025 edition of Market to Market - the Weekly Journal of Rural America.”

Hello. I’m Brooke Kohlsdorf. Paul Yeager is away this week.  

The financial world held its collective breath waiting for this week’s economic news and there were a few indications things might be improving. 

After a sharp 1.2 % pullback in January, consumers cautiously returned to store aisles. Retail sales rose 0.2% last month as buyers kept a close eye on the direction of the economy.

Sales of existing homes moved 4.2% higher as lower interest rates and an increasing pool of properties made the purchase more appealing.

The Federal Reserve kept its benchmark interest rate unchanged despite a plea from President Trump for a cut. The Board signaled it will cut rates twice this year based on the expectation that inflation will tap the brakes. 

The stock market continued its 5-week downtrend though this week was relatively flat. Economists are concerned a trade war between the U.S. and its key partners will lead to an increase in inflation. 

USDA has opened up enrollment for payments to farmers who were bitten by bad weather last season. Known as Emergency Commodity Assistance Program payments, or E-CAP, the potential payout for a long list of crops varies by commodity. 

Peter Tubbs has the details.

Peter Tubbs: America’s farmers will soon have access to relief funds for weather related disaster losses. 

This week, the U.S. Department of Agriculture announced that it will begin accepting applications for $10 billion dollars in direct financial relief for crop losses sustained by extreme weather events during the 2024 crop year.

The funds are the first tranche of $30 billion dollars assigned by the last Congress and signed into law by President Biden in December of 2024. 

Roughly 80 percent of the relief funds are expected to go to corn, soybean and wheat producers, but producers of 20 different crops are covered.

Producers who submitted acreage reports to FSA for the 2024 crop year are eligible for relief. Producers who did not file a report for 2024 have until August 15th of 2025 to submit their form to qualify for cash relief. 

Payouts are estimated to run $43 per acre for corn, $30 per acre for soybeans, $31 per acre for wheat, and $84 per acre for cotton.

Farm profits hit a record in the 2022 farm year, but saw declines in both 2023 and 2024. The USDA has predicted improved farm profitability in 2025.

For Market to Market, I’m Peter Tubbs.

Brooke Kohlsdorf: Thursday was the official start of spring but winter held on until the last minute. The violent storm system affected more than 75 million people in one way or another.

The storms marched across the U.S. on the heels of last weekend’s deadly storm that took 42 lives. Blizzard conditions in the middle of the country closed portions of I-80 and knocked out power to more than 140,000 customers in six states including Nebraska, Iowa and Arkansas.

The wind also whipped up wildfires throughout the South forcing evacuations in Texas and closing sections of the interstate in Florida. 

One of the rites of spring for row crop farmers is planting. One of their biggest challenges is preventing the loss of top soil. We’ve been following the increase in the use of cover crops as a way to preserve this most precious resource. 

There can be a healthy dose of doubt that goes with adopting a new practice like this one. If it’s too dry, cover crops are a draw on water. If it’s too wet, there can be concern about limited time for burndown.

Peter Tubbs looks at a region in Minnesota where the practice has returned. It’s this week’s Cover Story.

Peter Tubbs: A cover crop seeder moves across a standing cornfield in the late August heat. What began as an experiment has turned into a side business for a Minnesota farmer.

Andy Linder, Minnesota Farmer: “I got into it by attending a meeting and a field day and listening to people that were doing it, going out in the field with the farmer afterwards and, you know, show him, showing me what was happening in his field because of what he was doing. And I decided I wanted my farms to look like that, too.”

The soil condition or tilth of the fields Linder seeded with cover crops began to quickly evolve.

Andy Linder, Minnesota Farmer: “First I saw the soil start to change. It became a little more aggregated, crumbly, you know, chocolate cake, cottage cheese kind of thing is what people use for terms. The weed pressure was less because of having that cover and not doing the tillage on the farm. Some of the more rolling slopes that we farm, the erosion was far less. So there's a lot of visuals that made me want to continue with it.”

Linder and his father began planting cover crops across all of their acres over three growing seasons. A change in the economics of his farm followed. Yields were steady, but margins improved after a shift in the cost of inputs. While the growing season required fewer passes across fields, different equipment was needed to maximize the efficiency. 

Andy Linder, Minnesota Farmer: “Yes. And if not profitability, less work because there's still a cost to putting the seed out there and doing the application. And especially today, with higher interest rates and inflated machinery, that equipment is expensive to own. 

The cost of machinery didn’t slow Linder’s adoption of cover crops. Originally dispersed by airplane, Linder is now on his second wheeled rig, this one built to serve as both a sprayer and seeder. The machine can seed cover crops into standing crops at an average of 50 acres per hour.  

But concerns over the cost of new equipment are only one of the hurdles the cover crop curious must clear before seeding their own fields.

The plan for this field is for the winter rye, turnips and kale to germinate before the corn harvest, and then grow until the snow comes in November. The growth should resume at snow melt and continue until the field is ready to plant in April or May, when the cover crop will be terminated. 

Linder’s purchase of equipment provides flexibility in his seeding schedule. 

Andy Linder, Minnesota Farmer: “And then the acres just kind of fell into place in the fall. And then, you know, through some trade shows and marketing and winter meetings promoting the machine, and it just kind of went from there.”

Once Linder and his father understood the improvements of the soil quality, the expansion of covered acres came quickly.

Andy Linder, Minnesota Farmer: “And then I try to associate some costs with each of our practices. And so even in corn mostly, you know, if I'm a little bit less on yield, I'm usually similar in profitability. My lenders also provided me with the same answer. They have a scorecard that they come out, you know, once a year and they say, okay, here's your farm and here's how you compare versus your peers. And, you know, yield was one thing that stuck out that, yes, you yield have less, but you are making the same or more money than your peers.”

Experienced cover crop farmers emphasize the long term  when discussing benefits of covers, and also to manage expectations.

Andy Linder, Minnesota Farmer: “Some try it with looking for a yield return because typically that's how you know us as producers are sold products is use my product just get this many bushels and that's that's not what you're accomplishing with using cover crops and less tillage It's not a it's not a yield return. It's a profitability thing and then it's a soil, you know, keeping your soil on your farm.”

The financial risks to farmers can be minimized through cost share programs.  A split of the expenses of cover crop inputs can encourage producers to introduce covers to their operations. 

Southern Minnesota has seen growth in cover crops as a result of cost sharing.

Nathan Carr, Faribault County SWCD: “99% of the counties is corn, soybean rotation. So how do we get those guys interested in some cover crops? And then that growth started in about 2016, 2017 and has moved to where it is now, where we have over 5000 acres a year that we're funding.”

In his work for the Faribault County Soil and Water District, Nathan Carr helps landowners reduce erosion and improve the county’s water quality.

Nathan Carr, Faribault County SWCD: “Our goal is to have them kind of learn themselves how it works. So what we do at the soil and water is if someone comes in and they're interested in trying and cover crops, it's okay. If you want to do 80 acres we can cost or that will pay for 75% of it.  So then if we pay for 75%, that reduces their risk significantly to where they're able to try it. And then they can see if they get any return on investment or they could try it for three years and do it that way.” 

The investment calculation is more than changing input costs. 

Changing tillage practices can be a slow process, especially when producers have legacy equipment designed to move the soil. 

Nathan Carr, Faribault County SWCD: “So normally in our area, we're doing, you know, making the soil black in the fall and then working it again in the spring and planting into that. So when we're doing cover crops, we're changing that whole tillage practice as well. So our incentive payments have been $55, you know, a year. We lock them in to do three years because you're going to have to change your tillage practice too. It's a lot of change there. So that $55 an acre is supposed to offset your risk.”

One producer in a neighborhood can influence others to try cover crops on their acres. 

Nathan Carr, Faribault County SWCD: “It's if you drive around, it's almost like there's pockets of conservation. So it's almost like when you drive around, if one guy starts it, you start seeing a little bit more pop up around it. Andy Linder started doing some cover crops and this was back when I started about eight nine years ago. He started doing some cover crops and then all of a sudden you started seeing some of his neighbors do it.” 

Interest from neighbors led Linder to begin custom planting cover crops in the region. His company can also drill seeds into fields following harvest.

With improved profitability through lower input costs, and fewer passes across fields meaning lower equipment costs in the long term, cover crops are appearing on more acres of Southern Minnesota.

For Market to Market, I’m Peter Tubbs.

Announcer: Next, the Market to market report.

Brooke Kohlsdorf: In anticipation of the March 31st acreage report, went up against uncertain news about tariffs, making the markets stay relatively flat. 

For the week… The nearby wheat contract added a penny and the May corn contract added 6 cents. 

The soy complex has been contending with South American weather as harvest nears completion and the planting of the safrinha crop is all but done. 

The May soybean contract lost 6 cents while May meal dropped $5.60 per ton.

May cotton contracted $2.02 per hundredweight. 

Over in the dairy parlor, April Class Three milk futures lost 61 cents.

The livestock market was mixed. April cattle put on $3.77. April feeders improved $3.78 and the April lean hog contract shed 50 cents. 

In the currency markets, the US dollar index bumped up 42 ticks. 

April crude oil found $1.47 per barrel. 

COMEX gold gained $24.40 per ounce, and the Goldman Sachs Commodity Index added almost 9 points to settle at 558-50.

Joining us now is regular market analyst Mark Gold. 

Mark Gold: Nice to see you again Brooke.

Brooke Kohlsdorf: Yeah. Good to see you too. Okay. So another week and we still don't know what's happening, really, with tariffs, so which is kind of been the story for a while, right? Has the lack of any fresh news been impacting the markets or how has it been impacting the markets?

Mark Gold: Well, the problem is we keep getting these changes, from the president on what's going to be tariffed, what isn't going to be tariffed when, it looks like April 2nd is going to be the date. And I believe he's going to put the tariffs on Canada. I don't think there's any question about it. Are they going to last? Usually once you put these things on, pretty hard to get them off. So I think that's going to be an issue that we're going to have to deal with. And we're kind of between the tariff and the acreage numbers, which are still a week away from Monday. The markets are just kind of trying to feel themselves out here without getting too loaded up. But we have seen over the last several weeks is the funds liquidating a huge amount of their long corn positions. They've gone from about 340,000 contracts now to under 100,000 contracts now. We'll see what the commitment of traders report says tonight. But certainly they've shed an awful lot of the light now in the next week. Are they going to try to get rid of more? We'll have to see. But they're short corn. Excuse me. Their short beans. Wheat meal oil. So I wouldn't be surprised if they try to get out of the rest of the long corn positions.

Brooke Kohlsdorf: You were in Canada recently, right?

Mark Gold: I was in Canada on Tuesday, and, you know, I got a warm reception there. People were great. I love the Canadians. Obviously they're very concerned with the tariffs. You know, they feel like they're friends and allies, which they are. They backed us in all of our wars and, they don't understand, you know, quite what's going on and why it's happening. But I think it's going to happen. I think they're, they're upset about it. But the Canadians are pretty resilient people, and I think they'll find a way to get around some things. But, it's certainly not good for agriculture, whether it's Canadian or American agriculture, in my opinion. I just would love to see more free trade, not more tariffs.

Brooke Kohlsdorf: As we look at wheat, this week, what's been impacting that market?

Mark Gold: Well, I think two things. Some of the weather that we're seeing in the Midwest, we've been incredibly dry. The drought maps show that things are not perfect for any growing season out here. A little bit too dry. Could, if we stay on this dry pattern, that's going to be an issue in the months to come. So that's been one thing with the wheat. The other thing is the Russians attacked the Ukrainian port city of Odessa again, despite the talk of Putin saying there's going to be a ceasefire. You know, you take whatever he says with a grain of salt and he continues the assaults. So I think that kind of perked up the wheat market. Plus the Russian wheat prices are moving higher. Our prices are getting a little more competitive now that the dollar has gone from 110 down to 103. So if we could get it under 100, that would certainly be helpful for our export markets. But I'm a little bit friendly to the wheat market here.

Brooke Kohlsdorf: Has a lack of export news also been hurting the wheat market?

Mark Gold: Well, certainly, you know, the exports up until in the last couple of weeks, we weren't too bad. Had a, I think a 508 hundred number out here. And now we're back to two something. But, overall I think we're going to see our exports pick up. With the Russians prices moving higher. The shipping is going to be a big deal here. What is the president going to do about shipping rates and putting, taxes on ships coming into our ports? So I think we have we have a chance to pick up some business out here. Hopefully, that'll be the case.

Brooke Kohlsdorf: Okay. Is the corn market at this point just waiting on...Not next week, but the 31st. It comes out, the, planning intentions report.

Mark Gold: Well, I personally think it's going to be a bigger than most of the analysts are looking at. The average guess is about 94 million. I'm guessing it's going to be 94.5, maybe close to 95. From what I've been seeing and hearing from farmers all over the country. You know, it's the same old story we've talked about 100 times. Farmers love to plant corn. They love to grow corn, and they love to harvest corn. And I think the amount of fall work we saw this year tells us they're not going to change those plans. A lot of these acreage decisions are made a lot sooner than they have been in the past, and I think it's going to be a big number. The corn bean ratio, just a little bit over 2.2, which certainly indicates a little bit of a lean, towards planting, more corn. And I think that's going to come at the expense at the expense of soybeans. I think we're also going to lose some rice and cotton acres in the corn. So I'm just hoping it's not, you know, a monster that's going to choke the market out here.

Brooke Kohlsdorf: Well, one of our questions on social media comes from Phil in Ontario. And he actually met you this week. He saw you and you were there, and he said that you advocated placing puts on corn to mitigate our risk. However, what about soybeans? How long could the soybean acreage number from USDA go...How low could it go on March 31st, and what should be our strategy ahead of that and then the April 2nd tariffs?

Mark Gold: Well, I think first of all, what do you do about the soybean risk out there? If I'm right and we lose these corn, if we gain the corn acres, we'll lose the bean acres. So I'm not that concerned about the downside, but I don't like to predict prices. So just like I would with the corn, I mentioned the film before, you know, putting on a cheap put just to get through the report. And I think the same thing can be had in the beans by a cheap, you know, short term, $10 or 9.80 put just to have something on just in case there's major surprises out there, because this report can be a major surprise. As far as the tariffs go. You can't play that game. So you've still got to manage the risk. And again, I think the puts are the best way to do that.

Brooke Kohlsdorf: You started to answer this a little earlier. But how damaging could the report coming out on the 31st, the intentions report, be for corn.

Mark Gold: Well it could be real bad. if all these numbers that I keep seeing, these trends are the people I'm talking to are right. It's going to be over 94 million. It's going to go to 95. Probably not maybe 94 or 5 to 94.8. Somewhere in there. Is there a 96 out there? I doubt it. But if it happened, it wouldn't be a complete shock. I don't think, to a lot of people, considering everything that's been going on. So there's there's risk in this corn market. I think it's a short term risk because we're using an awful lot of corn. The export market is through the roof. We're 400 million bushels ahead of the USDA base, which is about 158 million. So eventually we're going to have to see the exports move higher in the... in the carryout in corn move lower. So if we do get a knee jerk reaction lower on this corn report, at some point I'd be looking to buy call options for anything that I've sold out there. But I think I want to wait till after that report before buying those call options.

Brooke Kohlsdorf: We haven't talked about weather in Brazil yet. Is that something that we need to be paying attention to at this point?

Mark Gold: Not so much at this point. You know, the northeast was dry. They're getting plenty of rains. They're going to have a huge crop. The Argentineans are losing a little bit. It looks like one of the groups lowered their soybean estimate a million metric tons out there. But the combined crop that the Brazilians are going to have and the Argentinians are going to have, it's going to be a huge number.

We're through a lot of that hedging. We've got another probably 2 or 3 weeks in Brazil hedging a little bit more than that in Argentina. But, once we get through that push from the hedging, pushing it lower, then I think the, the beans can release and hopefully see a little bit better exports. And then we get into the spring weather and the summer weather and looks dry to me. So hopefully we'll get some kind of response from that.

Brooke Kohlsdorf: Okay. Well speaking of beans, how are some of those private estimates on planting intentions influencing soybean prices right now?

Mark Gold: Well, when you look at the carryout, we still have a hefty carryout in the beans. So I think the acreage numbers reflect that corn just as the plant, the crop that farmers want to plant out here. So I think we're seeing that in the lower being acre numbers. How low is it going to go? Is it going to go in or 83 million.

Well, wait and see. But if it does go under 83 million it wouldn't surprise me. And again cotton Acres and rice acres will be down to. And where are they going to go. Most likely in that corn.

Brooke Kohlsdorf: Okay. Hot off the presses. The cattle on feed report was out just a couple of hours ago. Is there anything in it that surprised you?

Mark Gold: Well the placement number was low 82%. And they were looking for 86%. We made contract highs this week in the cattle and then the feeder cattle. On Friday we had a key reversal in the feeder cattle for the back months. We didn't quite get the key reversal on the cattle market. we've seen the box beef go from 330 down to 325. So, you know, are we going to see a knee jerk reaction higher on Monday? It wouldn't surprise me because it's a bullish number, but is it already kind of baked in when we're already at contract highs? You know, it's certainly, as I've been recommending, you know, buying puts on these markets. Yeah. We were buying puts when cattle were feeder cattle were $20 cheaper okay. We've lost out of a $5 put. Maybe we've lost 2 or $3 on that put. But we've gained $20 in the cash market. We can live with that. We'd be rolling those puts up. If you don't have puts on now, do something or at least do the LRP. But you've got to protect these cattle prices because as we've all know, been on the business as long as we have, that cattle prices can take a big drop in a hurry, and you just cannot let these incredible record prices sit on the table. You got to manage that risk out here.

Brooke Kohlsdorf: Okay, so with hogs, the future has been a little uncertain. You could say so. Is that uncertainty or what's directing prices?

Mark Gold: Well, we've had a kind of a volatile market, but not an extreme. You know, we rally a couple of bucks, we break a couple of bucks. That's been going on now for quite some time. We've been kind of stuck in our range between 90 and 100 bucks on the nearby. we need to see a little bit better demand. we don't have any real threats in terms of, any of the swine flu things that could go around at the moment. So I think the hog market's pretty stable. the higher the cattle market goes, it certainly encourages pork consumption because it's so much cheaper. And we'll see whether that actually has an impact if we see that switch from beef and pork. But Americans love their beef and they're not going to stop eating beef. I know I'm not going to stop eating beef. So, you know, for me it's a pretty inelastic demand out here. I'll pay what I need to pay to get my beef, but, you know, at some point.

Brooke Kohlsdorf: Yeah.

Mark Gold: The consumer, a housewife, is maybe going to back off.

Brooke Kohlsdorf: Okay, Mark, we've got more time in, Market Plus that will be discussing some of these things that you mentioned and much more. So we're going to pause this for now. And as I said, we'll continue our discussion about these markets in our Market Plus segment. And you can find both analysis and plus on our website of markettomarket.org. Each Monday, the Market Insider newsletter is sent out with behind the scenes information on this program, how we put stories together and our exclusive details about our 50th season celebrations. Sign up now at markettomarket.org. Next week, we'll look at another data point in the acres debate as spring planting approaches. Thanks so much for watching and have a great week.

Announcer: What's next doesn't happen by chance. It happens when researchers and farmers work together to solve tomorrow's agronomic challenges. We're committed to creating what's next because at Pioneer our name is our mission.

Announcer: Family owned and operated for more than 60 years. Sukup Manufacturing is a full service provider of grain handling, storage, and drying equipment, helping farmers feed and feel the world. 

Announcer: For over 45 years, Steiner Tractor Parts has shared your love of antique tractors. New parts for old tractors. Learn more at Steinertractor.com or at (877) 559-7887.

Announcer: Tomorrow. For over 100 years. We've worked to help our customers be ready for tomorrow. Trust in tomorrow. Information is available from a Grinnell Mutual agent today.

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