Market Plus with Chris Robinson

Paul Yeager: Welcome to the table for the Friday, April 11th, 2025 installment of Market Plus. Joining us now Mr. Chris Robinson. Chris, thank you for going along with my craziness about patterns and what we talked about, because as I told you, soybeans are the story and have been the last two weeks. You can't move 40 down, 60 up and not think something's up. So my question is pretty simple that I wrote that I didn't ask you. Our soybeans have they just shake it off, shook off the news or are they just naive right now to what's going on in the world?

Chris Robinson: No, I think that two things, the funds were cut short and then now they've had to buy them back. And that's part of the reason we've had this rally. I think the world's realized that, you know, China doesn't take, a lot of corner wheat from us. So it really is if you're concerned about the tariff with China, which is really what this is kind of all boils down to, you got to be worried about two things or three things. Cotton, hogs, but especially soybeans. You know, we grow 4 billion bushels. They take, a billion bushels. So to have that, I don't know what they do with biodiesel or whether we, you know, we need that demand. So that is the key. It's, you know, we've had kind of a weird year. We were at 1060, 1070. We went down to 960. Now we came up, I think we finished today around 1040. So I mean, that was a really good recovery off the lows. I mean, that's the next level. I think people are watching. 1040 1050 so we're not out of the weeds yet. Most guys, I think, that I've worked with and talked to, they'd really feel more comfortable with beans up around 11. I think that's one reason we had seen the big shift in acres to corn from away from soybeans, because we'd already been at seen prices, you know, 450 corn is more attractive than 1020 beans, what it comes down to.

Paul Yeager: But we've talked about on this program since easily January, if not February, we're always gonna have more corn. The Outlook Forum confirmed it. The acres report confirmed that we're going to have beans that don't seem attractive. Beans don't seem attractive. Are beans attractive now?

Chris Robinson: I think we need a little bit more work to go. I think that if we can get more short covering or if we get some movement all in, this in the tariff issue, the first thing people are going to do is cover those shorts. Right? So it's a it's if there's probably a, fulcrum or one trade look at like pro-China, anti-China. It's got to be, soybeans. And it was interesting. I was watching, I watch stuff all day long, and you're starting to hear other people in other parts of the financial industry say, oh, you got to watch these soybeans now. So if, if we get any sort of a story, there, I put it this way, I wouldn't want to be heavily short. I know, I don't think you should be without a flaw. Right. Because this could all fall apart. Tomorrow we're back down to 960. Beans are like, you know, so reward this rally with the hedge. I don't know if I'm ready to make a cash show yet, but I would. As we go up, I would get a substitute cow with a hedge and hope that it continues to go higher, because what we don't want is to be sub 950 corn and going, wow, we missed that one again.

Paul Yeager: Your former boss sat in that seat and said once it shows up in the mainstream about any it's too late. It's too late. Do you think that's happened?

Chris Robinson: No.

Paul Yeager: Okay. All right. Well let's, let's, let's flip to feeders for a minute because that's kind of tied a little bit, live cattle more on the demand, but let's go.

Paul Yeager: Scott in Wisconsin, I need to put a little bow on feeders, if I could. Will we see $3 feeders on the board?

Chris Robinson: Well, I can guarantee you, if I sell ten lot for myself, will be there tomorrow, because that's the way the cattle have been trading, you know, for the last eight months. It's just, you know, incredible bull market. We got to within, I think, $0.03 or $0.04 of the, you know, and the third months have seen the $3 print if I thought surprised that we want all that way and some computer program didn't get the print. I still think it's possible we didn't do a whole lot of damage. We did some damage to the uptrend but we didn't completely destroy it. So we had a sell off. We've recovered. I think that moving ahead, it's definitely a possibility. The feeder cattle market has been the best bull market since the bottom of the Covid, you know, and, and, but there are some things you got to watch. Number one, managed money is still long. If they decide to bail, if they decide, you know, we don't want to have any more to do with being long cattle, then I think we have a problem.

Paul Yeager: You drew a line this morning on one of your charts, this bull trend on feeders. Yeah. What's that? Top of that bull trend. I mean, you say $3 possible.

Chris Robinson: Anything's possible. I mean, you know, anybody that tried to call a top in the past six months, the other if they really got hurt. That's why this has been, I talked about this before the, you know, how do you head something like this if you're hedging with futures, you've, you know, you left a lot of money on the table. This market in the last five years has taught everybody that, using a put option is probably your best hedge for cattle because you set a floor, but you don't get hammered on the margin calls as cattle price continues to go higher. It's really what it comes down to. So at some point we have these corrections. And like I'm glad I have a floor. I did a seminar about three weeks ago right before we had this big sell off. And there were hedges that a lot of, you know, I wasn't like, I, I was alone saying, you should look at these hedges. There have put spreads, put options. You can go out there. And for defined amount of money for a defined the amount of time you can protect revenue. And that's really what a hedge is about. Hedges is about protecting that revenue. When the market gives you you know, we had a $60 rally from September to the top. You know, now nobody's going to get all of it. But you don't want to do is watch 40 of it go away. That's what it hedges for. So I would say this, who am I to say that we can't go out and get a $3 print? I hope that we do. Yeah. But in the meantime, when the market gives you, like, the rally that we just had, the recovery rally, take advantage of it.

Paul Yeager: I want to do weather, but I need you to answer this question two different ways. Jordan, Wisconsin wanted to ask you about planting. It is the insurance state has started to roll. His, he's asking to plant or not to plant?” That's the question. I want you to answer that one weather, two early-wise and then I want you to think about acre change. You've kind of already answered it on the soybean. It's maybe too early to tell. Everybody's planting right now. What do you think?

Chris Robinson: The guys are locked in? I think, you know, when they do the survey for the for the, government, you know, a lot of that is, you know, but I think at the end of the day, I've been in this business working with farmers for 15 years, but as a trader for 30, if you give a farmer a chance, they're going to plant corn rather than beans. So I think that they may say they're not going to do that. Now the question is, how many acres are we going to finally get? We'll have to wait a while to actually get that real number. I think that's already baked in that, that we're going to have more corn acres than we thought. But, we'll, we'll see what happens. The same thing happened in 2012. We planted the most acres we've ever planted for corn. And then, you know, we had that drought. So even if we do plant a lot of, acres, if we get a weather issue, all bets are off. So that's what I would say if. And if you're on the fence about planting beans or corn, depending on where it is. More and more guys I work with, they're starting to plant beans earlier than corn, so that's going to be something I would watch to see, you know, and we see that unfold. But if you look at the the seed sales and stuff that run, I think that's already pretty much locked in. And, we'll just going to have to wait and see how it turns out. If we get a drought.

Paul Yeager: Let's do a tariff sandwich. Let's close the tariffs here. Let's do, let's do. Tim. In Minnesota, if we could, Chris. Tariffs on tariffs off. What can a producer do.

Chris Robinson: Well I would say this no where you were a break-evens. Ha. Know what. You won't know what that price is. If we happen to get there defend it, defended, defend it. And we actually had some earlier chances to do some sales early before we had this sell off. Now we're getting right back up to if you look at these corn, 460, 465, we topped out around 470 3/4. Some like 479 something like that. So we're getting back up towards our highs at least for this year. Reward it. Same thing with soybeans and soybeans., at one point we were at I think 1075. So if we get back up there again, don't turn your nose up on it. How do you how do you do it? Well, again, I get it. People don't want to sell. They don't want to commit. But you need to hedge. And maybe you don't hedge 100% hedge what you can afford to hedge, but, defend that revenue because we've seen how quickly it changes. That's the one thing I think that's that's hard for even guys like myself to wrap their head around the way the soybean prices move. If you're not hedged before it happens, it's it can be really, disheartening. And also, it can make you make a bad mistake. The worst mistake you can make is make an emotional bad cash sell because you're frightened. I'd rather see you buy a cheap put, and wait for a rally. Hope for a rally. And we did that here. I, guys call me up, say I have to sell some means, like, now let's do this. Let's do a cheap put instead. Now we got a 65 cent rally. Reward that rally.

Paul Yeager: And frankly, it goes back to the previous question we're about to plant.

Chris Robinson :Yeah.

Paul Yeager: People are going to be busy and not able to focus on every waking moment of what's happening. Let that work for you.

Chris Robinson: That works for you. Look at it once a week. I have guys that, you know, they check in once a week. The daily moves can really upset you and so maybe, you know, dial back the time of being. Oh, what, what's happening now? Because we're going to be moving, quite a bit $0.20, $0.30 at a crack. So when it gets to that level, I can't say it enough. When it gets to your level, do something. Don't be afraid to set a hedge. Don't be afraid to make a cash forward sale. You can always reopen it. If you're concerned that it's 2012. We didn't start going bananas in 2012 until June 1st. So this is April, you know, 14th.

Paul Yeager: Time is on our side.

Chris Robinson: Yeah. Time’s on your side. Right? Right. And we may have to wait to see, you know, you were mentioning, you know, the possibility of a drought every year. That's the drought. Yeah. Possibility.

Paul Yeager: So. Well, that's the conversation I just had yesterday with a couple of farmers. They're, they're on an area and it's not very far away from where the rain is falling. And you look at anything in the Eastern Corn Belt and they're concerned about it's kind of wet. We're not going to be able to go. So the weather story is there.

Paul Yeager: Yeah. All right, Chris, good to see you.

Chris Robinson: Good to be here.

Paul Yeager: Chris Robinson everyone. Thank you so much.

Chris Robinson: Thanks.

Paul Yeager: All right. That's going to do it here for Market Plus. But I do want to say I'd like to remind you to sign up for that Market to Market Insider newsletter. It is free. Sign up at markettomarket.org. Hey, and when you get it, it comes every Monday morning just before 10:00. Open it up, see what's in there. Let us know what you think. Vote on our poll. By the way, next week we are going to turn waste into an investment in your operation. And we'll have Jeff French here for his commodity market analysis. Thank you so much for joining us. Have a great week.

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