Katie Geerdes

The soybean rally sputtered on Tuesday and Thursday this week at the same time that the stock market was selling off. Immediate points of alarm for equity investors included the pending impacts of the Supreme Court hearing on the validity of President Trumps tariff authority, which overlaps with soy traders awaiting confirmation of follow-through or lack thereof on Chinese export purchases. All industries are left susceptible to tariff decision ramifications that could include a mess of lawsuits over tariff refunds. Striking down the specific tariff authority being tested diminishes the basis of prior trade deals, but it sets up a likely quick replacement of new tariffs under alternative legal powers, prompting another web of court cases to follow.   Adding to attention on tariffs and the government shutdown, two other storylines were raising interest for threatening to destabilize financial markets – cracks showing up in the commercial credit market and fears about artificial intelligence causing structural unemployment to rise. These stories leave a person hoping that the stock market nervousness expressed this week was not foreshadowing a worse panic where the public hears a lot more about 'receivables factoring' or worse, 'the AI bubble.'   Receivables factoring is the business…

The opening arguments in the case presented to the Supreme Court over the legality of president Trump's use of emergency powers to unilaterally declare and impose tariffs, without explicit Congressional approval, appeared to favor the plaintiffs judging by the Justices comments. Congress has given the executive branch emergency powers but these have never been legally defined in context with tariffs until now. The tone of the Justices during the opening arguments, how many questions and to which side they are directed, can be a sign of how they are leaning but it is not definitive. The tone appeared to favor the plaintiffs. No one knows for sure how long it will take for the Justices to render their verdict but it could be months rather than weeks to wait.   President Trump was clearly concerned about this court case as it goes to the heart of his authority to levy tariffs without Congressional approval. No one has taken as much license to do that as this president has. The 1930 Smoot-Hawley tariffs were initiated and enacted by Congress without the initial support of president Hoover who agonized over whether to sign a bill authorizing them but ultimately succumbed to political…

For better or for worse, a trade deal with China is consummated. Soybeans traders will now spend the better part of the next several months or more attempting to discern whether China will abide by that deal. China does not have a great track record when it comes to honoring their trade agreements, and so we prefer to error on the side of caution. Part of how we come to understand trade deals could get lost in translation. Not all countries stop at their respective "STOP" signs when driving, as some consider them merely a suggestion. Could China consider our soybean purchases to be a similar suggestion? It cannot be understated that their purchase of ag products is "unbinding" much like the last trade deal. Meaning there are no repercussions if they do not follow through. After the first trade agreement, we saw no apparent change in their buying pattern, continuing to purchase beans in Brazil where they were cheaper. Why would they stop now?   A big part of the trade deal with China was gaining access to their supply of rare earth minerals without stipulations. They agreed to extend the availability for twelve months, which means we may…

I am not a big baseball fan but I did follow the World Series. It was not only the Dodgers against the Blue Jays or LA versus Toronto but it was Canada versus the US. I have never noted that President Trump has paid any attention to the game of baseball either (until LA won being invited to the WH) but many Canadians thought that they were playing the Series against him. That made them want to win very badly. I checked the odds ahead of the series and pundits gave LA a 4 to 1 advantage to win over Toronto. The Dodgers are in first place for players' salaries at $350 mln versus the Blue Jays which are in 5th place for players' salaries at $255 mln. The Blue Jays had them until they didn't. The Series went through game 7 and had two games with extra innings including the final, until the Dodgers eked out the win. That was how it was likely going to end but Canada rallied to make it a seriously contested Series. They were not intimidated by the Dodgers and played to win. I did not note any evidence of disrespect by the Dodgers…

Yeah…grain farmers with average yields are not making money but neither is it as bad as the YouTube click-bait suggests, describing unsold grain/soy bursting grain bins and soybeans rotting in storage. Post-harvest, corn basis levels have improved while soybean basis levels not so much. The soybean supply pipeline must have gotten filled. It would appear to me that our farm, corn/soybeans is going to remain in the black this year because of a record corn yield and being 70% corn. Our soybeans were a loser, with a disappointing 65 bpa yield with a $100 acre loss before a Trump trade aid-ACH and potential farm program payment. When all revenue sources are added up, I would think that soybeans will be close to break-even. Our corn will make money. My son says that his cost of production for corn is $1,050 acre. About 45% was corn-on-corn with 55% corn-following-soybeans or prevent-plant. The yield is believed to be 262.5 bpa, a new farm record for 540 acres of corn. That was very close to our July yield estimate. I said then that I thought it was a record yield. The previous farm record was 261 bpa so that was just barely correct.…

The Facts of the Matter: China Removes U.S. Ag Tariffs     Morning Market Talk Below, you will find today's installment of Morning Market Talk. You can copy and paste the link below for this morning's episode.   https://youtu.be/iaHehbcPXpY?si=nALKzEr25ZSB0nnN   On the Grains   Soybeans pushed to for-the-move highs overnight, with the January contract reaching the highest level since July 2024. Wheat actively traded higher, with the December SRW contract extending to the highest price since the beginning of August. Buying in corn was reserved, with the December contract holding below last week's highs, as there has been no talk yet of Chinese demand for U.S. corn – and there may not be any – which would keep corn firmly in a follower's role.   The White House on Saturday released a fact sheet (see below for full details) that said Beijing will lift retaliatory tariffs it imposed in March, including those "on a vast swath of U.S. agricultural products," listing chicken, wheat, corn, cotton, sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables and dairy products. The removal of the retaliatory tariffs will help make U.S. farm products competitive. Of note: There has still been no confirmation from Beijing on…

Cattle futures remain near the top of the list for price performance over the last twelve months, pacing just behind gains for commodities including gold and coffee. On the opposite end of the spectrum are wheat futures, which were lower on the year along with cotton, oats, and lumber. The previous year of price action contrasts with what has lately been a reversion of trends that features cattle futures correcting lower while grains stage a recovery. History may eventually show this fall to have been a significant point of inflection for grains, livestock, and many other markets.   Leading and lagging the one-year performance list were coffee and orange juice. Both markets started turning lower at the start of 2025, but they would diverge this summer when coffee futures turned back around toward fresh all-time highs while orange juice futures kept going lower to cut prices by more than half from their one-year top. Coffee and orange juice display alternative paths forward for cattle and other markets that have recently paused following new all-time highs.   Gold has been yet another commodity to display sharp downside volatility after having stretched to fresh record highs this month. Gold and the rest…

Morning Market Talk Below, you will find today's installment of Morning Market Talk. You can copy and paste the link below for this morning's episode.   https://youtu.be/D57i5lwz2Cg   On the Grains Soybeans paused overnight as traders assess the China buying situation. Corn and winter wheat markets drifted lower. Soybeans are poised for their second straight week of strong gains. Despite losses Thursday and overnight, corn and wheat futures are still mildly higher for the week.   Well… that didn’t take long… and it shouldn’t if China is going to purchase 12 MMT (441 million bu.) of soybeans for delivery by January, as Treasury Secretary Scott Bessent told us yesterday. Bloomberg reports that China bought at least four cargoes totaling around 250,000 MT for shipment late this year and early 2026, citing people familiar with the situation. State-owned COFCO was the reported buyer. This should and will be a recurring storyline if China is going to live up to what the Trump administration says it agreed to.   This followed reported purchases of three cargoes totaling 180,000 MT purchased by COFCO ahead of the trade deal between President Trump and China’s Xi Jinping.   If you are keeping score… that’s 430,000…

I am going to start this report with a shout-out to my grand-daughter Taylor Wuebker who is in Indianapolis at the National FFA convention. She is wearing one of those blue jackets with Iowa on the back. She is our next generation getting started in Agriculture. I am a proud grandfather. Finally…Some Answers! And More Questions   I have been posing a lot of questions recently needing answers and we are getting some this week. The really big question was how far that Trump and Xi would go in the trade war and the answer is that neither wanted to disengage fully on trade. Each for their own reasons sought a trade deal. We will remain engaged in trade with each other. I do believe that Trump miscalculated the leverage that he had over China and had expected a more lopsided result in his favor. Tik-Tok was not resolved and no high-end computer chips were committed to China. This handshake "deal" is just a pause in the confrontation that temporarily resolves some superficial issues without getting to the heart of the challenge. The confrontation is not going away and competition, posturing and positioning will continue. Neither Trump nor China was…

We wrapped up the 2025 harvest this weekend on the farm in NW Iowa. Corn yields were in line with what we were hoping for. We don't have the final weight tickets yet, but overall we should be north of 250 bpa….maybe more. We might have a shot at taking out our personal best of 261 bpa. We lost 10 to 20 bpa on the high wind (mini-derecho) event that occurred in August, causing sporadic lodging throughout the field. The corn stalk did not collapse but it snapped over enough, effectively shutting off nutrients to the ear. Some things we learned this year: Fungicide was the big one. It probably saved us 30 bpa or more. We also learned that not all fungicides are created equal, as some reported applying fungicide but still reported crop damage to disease. We also heard from folks that are starting to put a second fungicide application in their routine. Part of this depends on the growing season, as drier years may not warrant it. The challenging part of fungicide in my opinion, is you need to have it applied before there is any visible impact.  Speaking for our area only, in mid-August growers were…