Market to Market - April 18, 2025

Paul Yeager:  Coming up on Market to Market -

Businesses work through a rapidly changing landscape on supply chains. 

Turning waste into an investment in your operation.  

And commodity market analysis with Jeff French.

Next.

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Announcer: “This is the Friday, April 18, 2025 edition of Market to Market - the Weekly Journal of Rural America.”

Hello. I’m Paul Yeager.   This week featured Tax Day in the United States. 

April 15 has long been a marker of procrastination as filers complete their taxes just before the deadline. 

It would appear shoppers were also sprinting before a tariff deadline to make some purchases.

Retail sales added 1.4 percent in March, the highest mark since January of 2023. Analysts say the data underscores the uncertainty shoppers face as they try to get ahead of the predicted higher prices due to new tariffs. 

Some businesses tried to do the same and import some supplies for their operations.

Peter Tubbs looks at those efforts in this report.

This week, Americans continued to adjust to the economic ripples of President Trump’s tariffs.

The Port of Long Beach, the country’s largest port, is estimating imports through their facility will decline 20% by the end of 2025. 

Mario Cordero, CEO, Port of Long Beach: "Our concerns about reduction, I think are gonna really start being elevated as we move towards May. We already have - our staff has now recorded 17 cancelled sailings from the international carriers, which means less containers coming into the complex."

The port recorded its busiest January ever, and volumes are currently up 27% over the same period of 2024. Experts are unsure how much of the increase is being driven by importers increasing orders ahead of tariffs.

But the tariffs are beginning to affect import traffic. 

Robert Spakowski, commercial ship seafarer: "They're turning around container ships that were headed our way, just saying 'Just forget it. Come on back.' And no one knows for sure yet what's happening. What's going to happen. But it's likely that the hundreds of container ships that come in every week are going to be much less. Much less."

A drop in import volumes would end a run of nine consecutive months of volume growth at the port. 

The tariffs on imports from Canada are adding uncertainty to the budgets of maple syrup producers in Vermont. As the producer of 73% of the world’s maple syrup, Canadian companies are the main supplier of syrup processing equipment.  

Jim Judd, owner, Judd’s Wayeeses Farms: “I've spent countless amounts of hours and lots and lots and lots of money in Canada because they are the primary producers of high quality equipment. Any kind of disruption with our cross border enterprise, we feel it. It’s uncertain enough making maple syrup.”

Judd has been making Vermont’s signature agricultural product since 1978, and the fickle weather of the Northeast makes syrup a challenging business. Judd is also dependent on a now-tariffed global supply chain. 

Jim Judd, owner, Judd’s Wayeeses Farms: “Our containers come from Italy. There's now a new tariff on Italy. So, we're sure our container price is going to go up. A lot of our stainless steel fixtures come out of Asia.”

The maple syrup industry in Vermont has seen dramatic growth over the past 20 years. The number of sugar makers in the state has increased, and the volume of syrup has expanded five fold. 

But the on-again, off-again nature of the Trump tariffs makes planning difficult.

Jim Judd, owner, Judd’s Wayeeses Farms: “We are as I mentioned earlier, producing a luxury product that isn't necessary for your table. It's something you like for your table, so we can't just arbitrarily raise our price.”

For Market to Market, I’m Peter Tubbs

Paul Yeager:  An idea is just the start in business. 

Then there’s the need for strategy, capital, marketing, customer service, accounting and more to make it all work.  

You’ll have inputs to help make products and invariably, waste.  

Turning what is perceived as waste into profit - that’s resourcefulness and could do more than just help the bottom line. 

Josh Buetter looks at a process that’s helping the environment as well in this week’s Cover Story.

For the state of California, taking a bite out of climate change is a high priority.  In recent years, more legislation has sought to bolster long-time efforts, across the board – and for some – solidified the notion that one person’s trash could be another’s treasure.

James Moore/Director – Merced County Regional Waste Management Authority: “I think the landfill industry has a vested interest in seeing better opportunities for the use of the methane we generate.  It’s definitely a fact that California does typically set the standard, and then other states follow in the successive years.”

  Merced County Regional Waste Management Authority Director James Moore says his Central Valley utility now annually diverts 25,000 tons of green-waste material they would have previously buried.  Subterranean decay does act as a carbon sink, but anerobic conditions underground also produce volatile methane, a greenhouse gas 28 times more potent at trapping heat in the atmosphere than CO², according the U.S. Environmental Protection Agency. 

Under Senate Bill 1383, approved by former Governor Jerry Brown in 2016, and in effect as of 2022, residents and businesses are required to compost food and other organic waste in utility-provided carts.  The goal is a 75 percent reduction in entombed organic waste by 2025. 

The action has opened the door for contractors and jurisdictions like Merced County to not only produce compost commodities for landscaping and soil development, but capitalize on existing mitigation systems.

James Moore/Director – Merced County Regional Waste Management Authority: “For the last 20-25 years or so, landfills have put in – based on regulations -  methane collection systems.  In the last 20 years, it’s become quite economical to capture that gas, and use it for either energy generation, or under the new regulations today, renewable fuel standards – rather than just environmental control – burning it off or burying it.  So, there’s an economic advantage to being able to put in these power plants, or conversion plants, and transform that methane into a renewable natural gas that can either be injected into the pipeline, and used just like natural gas, or be used to create fuel.”

        The Renewable Fuel Standard has benefited U.S. corn growers by requiring a percentage of biofuels, like ethanol, be blended into the nation’s fuel supply.  But the federal mandate also covers biogas, a cellulosic, or next-generation source – which also qualifies to generate Renewable Identification Numbers or RINs.  These credits are sold to major polluters like the oil and gas industry to keep their emissions in check.

       California’s Low Carbon Fuel Standard, a similar state program, may be stacked with RINs to provide a dual windfall – an enticing incentive for a state at the forefront of the shift from gasoline to electric vehicles.  Some say biofuels can help bridge the gap.

Dr. Sarah Kurtz – Distinguished Professor – School of Engineering/Department Chair for Electrical Engineering Dept. – University of California – Merced: “I think there is a real opportunity for biofuels – largely because they can be stored.  If we shut down all the fossil fuel, right now, the world would come to a screeching halt.  We would starve, we would freeze.  That’s not the way we are going to be able to build a better world.”

        University of California – Merced Distinguished Professor, Dr. Sarah Kurtz, spent more than 30 years working at the National Renewable Energy Laboratory in Colorado.  Her tenure in Merced has focused on integrating various energy sources to collectively drive down costs, with a focus on choice, as opposed to government mandates.

Dr. Sarah Kurtz – Distinguished Professor – School of Engineering/Department Chair for Electrical Engineering Dept. – University of California – Merced: “California is definitely a leader.  They are doing some things very, very well.  I do want to raise a concern, that one of the ways they’ve done it, is to say, we want to do it at whatever cost.  And we end up…then we have some of the most expensive electricity in the nation.  If electricity prices go sky-high, then who wants to electrify?”

UC Merced staff are tackling today’s challenges from various angles.

Dr. Gerardo Diaz/Professor of Mechanical Engineering/University of California – Merced: “This area, where we are, in the Central Valley – there is a lot of generation of biomass.  Not only in the Sierras, for the forest type of waste, that is available, but also, agricultural waste.” 

 Dr. Gerardo Diaz says bio-circular economies keep money on the farm - and techniques like using livestock compost bedding made from sterilized manure solids can help cut methane and other objectionable by-products.

Dr. Gerardo Diaz/Professor of Mechanical Engineering/University of California – Merced:

“We were able to show that there’s a reduction in odor from the dairy production.  That really helps to improve the quality of life of some of the surrounding communities, for instance.  Sometimes, people don’t consider those things.  But, we have a large community of people that are either rural, or disadvantaged communities, or low income, that are affected by some of these aspects.” 

Entrepreneurs who’ve worked with UC-Merced are harnessing the rising tide of energy incentives to help float dairy operations of all size and scale.

Omar Ramirez/General Manager – Aligned Digesters: “It’s not super-sophisticated technology.  It’s a natural process.  You know, it doesn’t get more simple than this.  It’s a covered lagoon capturing the methane that is being released from the microbial activity within the manure.  Takes about 30 days for the biogas to be generated underneath the cover.”

Aligned Digesters General Manager Omar Ramirez says after purchasing the proper equipment, similar systems can generate power at 9¢ per kilowatt hour, as opposed to up to 22¢ from a local utility.  He adds this dairy in Chowchilla, which milks 6,500 head, feeds his setup roughly 350,000 gallons of liquid waste daily – which can generate around 2 megawatts of power.  Net metering can further offset inputs, while even more potential remains.

Omar Ramirez/General Manager – Aligned Digesters: “On the plus side, if you’re doing renewable natural gas, you could also power your fleet, onsite, to haul your milk, to haul your feed…  It’s really easy to create a circular loop.”

Critics charge this bevy of benefits encourages booming herds and exponential greenhouse gas, but Ramirez sees it as a hedge.

Omar Ramirez/General Manager – Aligned Digesters: “The dairy market is very volatile.  In our mind, it’s dairy first and how are we going to help the dairymen generate that additional revenue stream while helping the environment - and also putting a little bit more money into their pocket for the hard times.”

For Market to Market, I’m Josh Buettner.

Paul Yeager:  Better weather allowed for spring field work to be in high gear as a lack of moisture added to the picture.

For the shortened trading week… 

The nearby wheat contract lost 7 cents and the May corn contract cut 8 cents. 

Soybeans were helped by the weaker dollar and improving crude oil prices.  

The May soybean contract fell 6 cents while May meal declined $4 per ton.

May cotton expanded 48 cents per hundredweight. 

Over in the dairy parlor, May Class Three milk futures added $1.04.

The livestock market was higher. June cattle improved $7.28. May feeders put on $8.15 and the June lean hog contract increased $4.70. 

In the currency markets, the US dollar index weakened 82 ticks. 

May crude oil gained $2.79 per barrel. 

COMEX gold strengthened $76.50 per ounce, and the Goldman Sachs Commodity Index expanded by almost 20 points to settle at 538 - 45.

Joining us now is regular market analyst Jeff French. 

Welcome.

Jeff French: How we doing, Paul?

Paul Yeager: Well, I'm okay. If I'm in the Plains right now looking at the weather forecast. Still dry, still hot. Is that a factor now in this trade?

Jeff French: On the wheat?

Paul Yeager: Looking at wheat.

Jeff French: It's going to be soon. I mean, we're getting into, the season where it's very important and Kansas remains awfully dry. They've been dry for a long time, but it's wheat and wheat can come back from that. So if they don't get any moisture or reduced moisture here in the next month, the wheat’s got a story. But if you look at the action in the wheat, I mean, it just can't get anything going. And you look at the three year low at the U.S. dollar, you would have thought we would have been a little stronger. But I think you're seeing a kind of an inter commodity spread here. We had a nice rally in corn and beans here the last couple of weeks. They've used the wheat as that short leg. but anytime the wheat gets going, it just gets undercut by the Black Sea. I mean, they continue to undercut the world values.

Paul Yeager: So still, the story that it's been that for several years, it's still the Black Sea story. Are there new buyers on the market with these trade challenges? I mean, everybody seems to be sourcing things differently. Has that come to the wheat pits yet?

Jeff French: It hasn't, but potentially. I mean, we're expecting they're they've they've, you know, hinted that there could be some deals announced here as early as next week with Japan and the European Union. So we'll have to see. But yeah, potentially. And I think that's what the market is. The market this week was kind of in a pause mode. You know, we had a lot of volatility the last couple weeks. This week was definitely kind of a breather. Sit back. And producers were in the field. So that reduced the volatility as well.

Paul Yeager: So if you're a producer are you sitting back and waiting right now?

Jeff French: You know I'm not selling wheat down here. we'll put it on some protection on paper. But I just think this wheat, it looks like it's found a bottom. and with what potentially could happen and the weather, I would not be selling wheat out here.

Paul Yeager: So in corn, weather is quickly becoming a story for opposite reasons, right? Eastern Corn Belt. Supposed to get a lot of rain this weekend. Western Corn Belt still supposed to be dry. Rain was very isolated Thursday night in Iowa, across to Illinois. Where's the weather? When does the weather story become a story?

Jeff French: You know, I think the rain right now probably leans a little negative. I mean, rain right now. You know, helps us. I mean, the soil needs a little recharge. I think if you get, if you continue this wetness in the next month, it becomes a story. But I think the rain right now, and especially next week, the market will take that as beneficial.

Paul Yeager: Also muted movement this week in corn. Why?

Jeff French: Well, it had a big move. It was up 10 out of the last, or, 8 or 10 out of 11 days. The last two weeks. that was a big move. And then you had areas, especially along the river. You had some of those July contracts that were paying $5 cash corn. So I think you've seen a good rally. Producers tend to reward good rallies. I mean, we are taking advantage of it. $5 corn from where we were at, looks awfully good.

Paul Yeager: Let's talk about December corn. If we could, Phil. There's the December corn contract. Let's talk about Phil's question. If we could year from Ontario. And he wants to know, is there any scenario where December corn reaches $5 in 2025, or is it more or less plausible than beans in the teens?

Jeff French: Oh, there's a scenario. I mean, we're not, we're not that far away. I mean, it feels like we're far, but, you know, we're going into the growing season. and, you know, you go back to 2020, the intentions in 2020 were for 97 million acres of corn. Okay. We planted 92 million acres of corn. So let's see what happens here during the next month. Doing it actually 95 million acres in like we intended to? We'll have to see. But yeah, you reduce that that corn, acreage planted to 92 million acres and then you throw some weather into it. We could be over $5 very easily.

Paul Yeager: Okay, quite the scenario there. So let's say if I take old crop out of this, new crop, am I doing any positions here starting next week?

Jeff French: Well, I think you got to put some targets in place. I mean, we've come $0.35 off the lows. You know, we're not looking to commit bushels right now in the physical market, but we'll put some positions on paper right now. but I think you got to have targets in every $0.20, $0.25, you know, stepped up you know, because we got big resistance up here at 480. And if we do get the acres in the ground, I mean, there is a bear scenario down the road, down the road.

Paul Yeager: You know, where corn's planted. You know, some is planted, but there's this shift to plant some places beans before corn. So does that change the scenario of which market is more impacted by whether corn or soybeans early in the growing season?

Jeff French: Yeah, I think it is. I mean, you're right. I mean, the last five, ten years, it seems like everybody is switching to planting beans earlier. Now, this year we actually did corn, first. but yeah, I think it effects the bean market right now a little bit more with the wetness. But again, you know, we're sitting here, it's April 18th. It's awfully early still. You know, talk to me here in the next month and see. Well see where we're at.

Paul Yeager: Well let's talk about beans then. Because that $10 mark was, we didn't think we'd get back over it. and here we are now, a couple of weeks above it. Are we here to stay?

Jeff French: Well, I mean, the beans are interesting. As soon as China announced tariffs, I mean, beans. What did they do instantly? Rally $0.75. You know, the uncertainty in the market is really what scares these markets. And once we kind of had some certain things that were known with tariffs coming from China and nobody else, that's when we saw the market take off. So you know, you look at a bean chart I mean July up here at 1050 it's had a big rally. We've got through 1050. But we didn't stay above it very long. but also I just don't think there's too many old crop beans left in the producers hands. I think it's in the commercials. And so that's really when we can see it move higher. But, you know, the beans have a story here with 80 to 83 million acres. you throw a hot and dry August, you know, this bean crop, if it has any reduction in yield. I mean, there could be definitely a story there.

Paul Yeager: But the story wasn't a story for the longest time. People who sat in your chair for weeks would say, beans. Don't look how I don't know. It's not profitable. It's not anything. Again there's that. I've already made my planting acre decision, but is there still a few people out there who might pull the trigger and plant beans

Paul Yeager: instead of corn?

Jeff French: Possibly. But I think Mother Nature would have to dictate that. And it's just too early right now, for that scenario. So maybe in the next 30 days we get late into May, we could see some maker switch.

Paul Yeager: Okay. November. on that, deferred on that, again, is this one of those that you have targets on paper that you need to put on to protect yourself?

Jeff French: Well, I mean, you know, to break even, most producers need about $11 cash beans right now. So, you know, you have 1030 on the board. Mine is the basis. It's, you know, cash beans right now, probably 980 in most areas. So, I think we're going to be patient here for the time being. put some protection on paper. But we'll wait till the growing season and see what happens here this summer.

Paul Yeager: You want to put any water on? The rumor of China is now going to Brazil, and Brazil might run out of beans. Is there anything to that story that we need to watch?

Jeff French: Potentially? I mean, they had an excellent bean crop, but I mean, this is the time of the year where China is buying from Brazil. Anyways. So let's see what happens. I mean, there's going to be negotiations. You know, we've had a trade where, you know, for 40 years, the U.S. just finally decided to join the battle. So let's see what happens with these negotiations and hopefully they get some work down here.

Paul Yeager: Are we caught in trade at all with livestock, specifically cattle?

Jeff French: You know, I think the trade war benefits the cattle. I mean, if we're not bringing in beef or the actual feeder cattle from Mexico or Canada, that helps our domestic price. So, the cattle look good. I mean, that, you know, 210 to 12 cash prices. The cattle on feed report came out Thursday afternoon. You know, maybe a slightly a little bearish just because the 105% places. But the numbers are going to remain tight. And we're entering May and June is probably some of our tightest time frame of this year. but you look at the general economy, I just think, these prices are awfully expensive. you know, I just, I think the downside protection here in the livestock, all proteins is a must right now.

Paul Yeager: The retail side of this has been talked about by consumers either when it's pressured with a job or with high prices. It looks like now both of those factors at some point where does that, what's a signal that that is converging on livestock?

Jeff French: Yeah I mean box beef up here at 340. I mean, you're absolutely right. We were talking, you know, before the show, beef is noticeably higher. the lot that in the last couple of weeks, but, you know, when does that happen? You know, I think it's kind of a slow rolling, and we'll just have to see. But yeah, you look at the general economy, you look at car sales and home sales. I mean, those are at or near or below, you know, 2008 recession level. So, the economy feels like it's kind of slowing here, no question about it.

Paul Yeager: And when that happens, what does live cattle do? What does the box beef the cattle market normally do?

Jeff French: Oh, it moves lower. I mean, the consumer will go to cheaper protein alternatives and there much cheaper. You know you got obviously the pork but poultry right now is awfully cheap.

Paul Yeager: Well yeah. Let's look at feeders. You mentioned, 98% on feed,  105 placed, 101 fed cattle marketed. What one of those, you kind of hinted a little bit of those. Which one stood out to you the most?

Jeff French: It was the placements. Yeah. it came over about 2.5% more than expected. But we're coming off a month where the placements were down in the 80%. So, you know, simply the tightness is going to continue. It's going to be what the consumer demand does.

Paul Yeager: And technically, that chart has not held with history in this whole run up, Right? This is more of a fundamentally driven story for feeders.

Jeff French: Absolutely. And it's been a story that's been going on for the last ten years. I mean, this cattle herd is small and it's producers getting out of the business, but also Mother Nature, the southwest of this country has been dry for the last decade.

Paul Yeager: Heck of a run up in hogs this week, too.

Jeff French: Seven days higher in a row. I think you got to take advantage of it. I mean, you have June right here, right at the 100 day moving average, right below 9970, right below $100. That's big time resistance. I can't stress that enough to get some downside protection here on the hog.

Paul Yeager: Is that because you see it as a trade story or a supply story or something else?

Jeff French: I think this is correct, it was a corrective bounce. I just think, you know, again, it was kind of like the beans, once we, once the hog market knew what China was going to do, we had that relief rally seven days higher in a row. You don't see that very often. Get some protection in place.

Paul Yeager: All right. Let's look at crude oil for a minute. And the dollar, because those are two other factors that are always at play. You mentioned the heck of a run down in the dollar, which usually is good for commodities. But crude oil now has bounced back. Which one of those two factors is the biggest story we need to be paying attention to?

Jeff French: Well, I think, you know, depending on, you know, from your input side, you know, obviously we want cheaper diesel, so that's good to see. But, you know, you have this dollar now below. You know, it close it, I think 99.19 for the week here. you know, from a chart standpoint, this thing looks like it could go down to 92. Time will tell. But I think the main indicator will be is how long this trade war with China continues. But, yeah, it's good to see that diesel prices have come down. and I think this dollar could potentially work lower.

Paul Yeager: All right. Good to see you, Jeff. Thank you.

Jeff French: Paul, thanks for having me. And Happy Easter.

Paul Yeager: Happy Easter to you as well. That’s Jeff French everyone, and I want to say that we're going to pause this analysis, but we're going to keep going and discuss these markets. In our Market Plus segment, you can find both analysis and plus on our website of markettomarket.org. Subscribing has benefits and that includes our YouTube channel.

And when you ring the bell for notifications on our page of YouTube.com / Market to market, you find out first when anything new is published throughout the week. Join us there today. 

Next week, navigating changes in labor policy.

Thank you so much for watching. 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: 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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