Market Plus with Sue Martin

Paul Yeager: Welcome to the table for the Friday, May 23rd, 2025 installment of Market Plus. Joining us now, Sue Martin. Sue, I had a conversation with a couple of farmers last weekend. Told them you were going to be on the show. They got all excited. They wanted to talk about volatility. I asked you about one of their questions already. We'll get to the volatility thing in a moment. But I also neglected something in the conversation I had earlier this week on a podcast that you'll see next Tuesday. And that was shorting the hog market. My apologies. So Sue hogs we talked about exports. There was actually news this week. Exports to Mexico were up 11% in the first quarter for hogs. What else is going on there.

Sue Martin: Well the hog market you know, even export sales this last Thursday was 68% higher than the four week average. And shipments were like 9% greater than the four week average. So that was good news for the hog market. And there's been lots of talk about, you know, shifting consumer demand over to pork, rather than beef because of how expensive it is and all that. And we're seeing some blending of pork, ground pork with ground beef. But the hog market, the one thing that has surprised me a little bit is how our kill keeps being pretty good. We've got good numbers and the weights are starting to drop off, which is a good thing if you want prices to try to push higher. The hedger has been the seller, but in the meantime you've got funds starting to buy that market. And it seems like if you look at the funds history, they've done a pretty good job in the last year or so, and when they start in, they're there to buy the bricks. So we need to keep an eye because the cutout hasn't really lifted very much. And what is amazing is how much we talked about or heard about PRRS and diseases and yet the numbers keep coming. We're surprised.

Paul Yeager: And there was a breakthrough in PRRS this week. Actually, and so that was a significant boost. But it wasn't on the week. And maybe that'll show up. Maybe not. Is that what?

Sue Martin: It hasn't yet. Because we've been through the winter. We had, you know hog diseases PED and then purrs and it didn't seem to phase the market at all. But I think when I look at the hog market, it looks to me like there is potential here to still try to push this market higher. Obviously, the USDA was right in their pig crop reports, and maybe the numbers is coming off of the efficiencies of pigs per litter. It's been pretty good.

Paul Yeager: We'll get to livestock in a moment. I will come back to it. I want to start, with feeding though. Let's go. Brian and Judy sent us this email. You can always email us at MarkettoMarket@IowaPBS.org. What's holding corn back is wheat going into many feed rations?

Sue Martin: Well, wheat certainly has been priced cheap enough that it can, but feedlots don't make that shift real easily once they start, they're there to stay for a while. And so I think I don't think the feed rations is, has fallen that much yet. And then if price of wheat starts to stimulate a little bit more, I think that that might even help keep corn. Corn's just not overpriced enough. It's just we got too cheap. And so I think when I look at the corn market, you know. Yes, feed usage is still good. Even more impressive is the exports. Our exports are fabulous on corn, and we're not going to have any problem at all making the USDA, export target.

Paul Yeager: Is it any new markets or surprising markets where our corn is going to you?

Sue Martin: No, Mexico remains our number one. One thing that I do have a little concern about with Mexico is they've been in drought, a pretty good drought. And I think that has helped stimulate the imports of corn. If they start catching some rains, which they are kind of now, if they start catching rains on a more consistent basis, I wonder, can that change a little bit?

Paul Yeager: Well, you said something this week about dryness in the Pacific Northwest and impacting the wheat market. I mean, if you look at the Drought Monitor, which we showed you in the TV show, it's not fully spread there yet, but you make it sound like that. Maybe conditions are getting close?

Sue Martin: They're watching it very close and the thing is, and I think what worked wheat over to the downside was the range that they did catch crush our winter wheat out of Kansas. Kansas is your largest producing state. But underneath it all there's diseases. You know, soft red wheat has certainly had its share of too much rain. Some areas looks good, other areas just too much rain. There's talk of Fusarium and, you know, you just you keep hearing about areas and, and even, mosaic streak, you know, in Kansas, wheat that and even could go all the way up towards Colorado. That's a concern because we keep getting that. And then it was really dry up in the northern plains. And they finally caught some moisture up there. But, you know, it's too early to say what's going to happen there.

Paul Yeager: Let's stay on the weather theme, shall we? And this question, Gary, in Wisconsin, and, you know, it's going to be a conversation piece here. Could cold temperatures and prevent plant acres speak in and move the market?

Sue Martin: I think it already has.

Paul Yeager: Which crop specifically.

Sue Martin: Corn. Corn.

Paul Yeager: Yeah. And is it only because of what's going on in the Eastern Corn Belt? Or is it also because of the dryness in the Nebraska, South Dakota, North Dakota?

Sue Martin: The dryness helped, but I think it's more the Eastern Corn Belt, you know, the backyard of the Chicago Board of Trade. And even though people trade a lot on computers anymore, it's still psychologically there. The delayed plantings getting in and getting things done. But then it's also the Delta and the horrible weather and the flooding that they've encountered. I think that we're just seeing it's Mother Nature picking away at every place. If it's a prefab plant, it could come back to see some changes, like in the final in the end of June. If it's, just replant the market never pays attention to that. So it's the prevent that would have an impact. And maybe acres, you know, the trade had been talking about, oh, we're going to even get more acres because we're getting in and getting stuff planted and, and then things sort of changed a little bit on that. So the question is, are we going to have more acres in that June, report at the end? I don't know if we will. We may see it just basically, status quo to under.

Paul Yeager: And it really probably the picture gets a lot clearer here in the next ten days.

Sue Martin: Oh, yeah.

Paul Yeager: Okay. Yeah. All right, let's, let's talk soybeans, if we shall. Scott in Minnesota wants to know, Sue, are soybeans the sleeper? Because everybody planted corn fence row to fence row this year.

Sue Martin: Well, I think soybeans, first off, yes, you have less acres. We've already dialed in that we've got the issues with China and they're going to Brazil. So that is, I think, kind of where in itself out a little bit. The other thing is, is that when we look at the soybean crop, if we get heat in June now, at first heat might be viewed as good mixing. Finish up planting. And then if it sticks and we're hot going into July, barring any unforeseen political, you know, roadblocks, I would say the market will rally and do something better than I'm thinking, indicators that I'm following on beans. The monthly looks beautiful and that tells me and the phones are going along. And when funds start into a position, they'll be there to buy the brakes. So I think this bean markets got potential. And then of course, you know okay. So we're not exporting maybe as many beans to China. We might be needing them at home. So I think we've got a potential for the bean market. I wouldn't write it off.

Paul Yeager: Back to the funds and back to livestock. Let's finish up here on, question, Scott in Wisconsin about livestock. The cure for high prices are high prices. How high do cattle go?

Sue Martin: Well, I mentioned on the show 320 possible for feeders, even though I wouldn't buy them with a bet that they're going to go. They're on the fats, You could go a little further, but, you know, cash back in 2015, in the month of May, cash got about all I want to say, $17 over the board of August Futures. And today it's running around $20 over the August futures. Now, in 2015, the market rallied into June 10th for a high. And then it broke. And actually, it put a low in on the August futures around the latter part of July. Bounced a little bit. And then it rolled over on the October futures. And the actual low on October cattle was on October 2nd, about $34 lower from the June high. And this is a risky time for those buying feeder cattle because you can't lock them in. The producers we've talked about often in our market letter and also even on the show, I think in the past, doing put spreads, buying at the money on $20 out of the money and selling those puts because of the market where it's at. Some of those puts that have been sold might be worth taking off now, because they might not be worth very much, and that would be the time to do so. I'm looking at this next week around the 29th, 28th, 29th, Wednesday, Thursday as a possible high beyond that into June, June 6th. But I wouldn't be chasing the long side of this market. You know, the June's is struggling to catch up or to gain on the August. And even though we had some, even though it was extremely light trade, we had some pretty good prices this last week. I think if you have that smaller kill this next week, that may stimulate the packer to bid more again just to try to get the cattle, but I think we're slipping on a banana peel.

Paul Yeager: And like you mentioned, the money in other markets. Yes. And you mentioned commitment of traders. Yes. Quietly they start exiting. It'll take what, 2 or 3 weeks before we realize that the party is over or is crowded as it was last week?

Sue Martin: But, you know, sometimes when these and the phones have been buyers of cattle, but when you start getting them looking to get out, sometimes they almost have to be pushed and when they start that we, we seen what the market could do. A week ago when we had a key reversal, huge key reversal, and happened in two days. And then our buy a little quiet trade every day. And there's that old saying, never sell a quiet market or kick sleeping dog because they'll both bite. The market managed to get up two thirds of that break. Well, when we've got to keep an eye on this, because if we go through the high, we could get up around maybe two, the August could get up around 218. Maybe I actually could maybe go more than that. It could maybe go up to around 222 to 23. I wouldn't expect much more than that. And for me, for the risk that there's out there, it's not worth being long the market. I find myself talking myself out of business some days.

Paul Yeager: Well, you know what we've done. We could continue to do this all day, but we've hit the end of our time. So as always, great to see you. Thank you, thank you, Sue Martin. Everyone. And a reminder get signed up for that Market to Market Insider newsletter. It's free go to market to market.org. Next week we take a look at building an agriculture program that's feeding a changing local community. And we'll have the commodity market analysis with Naomi Bloom. Thanks for joining us. Have a great week.

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