Market to Market - August 1, 2025

Paul Yeager: Coming up on Market to Market, Congress chastises USDA about failing to consult with them on their reorganization plan. The big get bigger in a coast to coast rail merger, keeping tabs on the decision makers and connecting readers and commodity market analysis with Matt Bennett next.

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Announcer: This is the Friday, August 1st edition of Market to Market, the Weekly Journal of Rural America.

Speaker: Hello, I'm Paul Yeager. Upending the norm has been one of President Trump's hallmarks. He did it again as the August 1st trade deadline approached, announcing new levies on some countries and extending the timetable for dealmaking with others. This was also a big week for filing and filling in data points from economic reports, and they may be revealing that uncertainty is weighing on some economic indicators. There were 73,000 jobs added to the economy this last month. This was also one third below expectations. The unemployment rate rose a 10th of a percent to 4.2%. This week, the Federal Reserve Board voted to leave the key interest rate alone. The PCE, the government's preferred measure of inflation, added 3/10 of a percent last month. GDP for the second quarter was higher by 3%, reversing last quarter's reduction. The Department of Agriculture was established in 1862 and set up headquarters in Washington, DC. Over the years, USDA has grown in size, expanding its offices in the district and across the country. The Trump administration would like to reduce the footprint of USDA in Washington, and Congress called them to the Hill to defend their plans. Peter Tubbs reports.

Peter Tubbs: This week, the Senate Agriculture Committee heard testimony about the Department of Agriculture’s plan to reassign staff currently based in Washington D.C. to five cities around the country.

Senators questioned the USDA over the likelihood of current staff accepting transfers and whether the selection process has already been completed.

Senator Raphael Warnock, D - Georgia: “So a relocation for family is a big deal. What do you think will happen?”

Stephen Alexander Vaden, USDA: “Senator, I think actually, a large number of them will choose to come. I think many of them will choose to come because given cuts made by other federal agencies here in Washington, D.C., the job market isn't what it once was here. And I think that the exciting opportunity these new hubs provide for them to actually be able to own a home affordably and grow and expand their family with a lower cost of living. That's one of the primary reasons we chose each of these five hubs will attract them to come.”

Senator John Hoeven, R - North Dakota: “As we look at the five sites, from my part of the world, there’s nothing within 600 miles of us, from Fargo, North Dakota for example, and we are in the heart of ag country.” 

Stephen Alexander Vaden, USDA: “We couldn’t put offices everywhere, and we learned some lessons from the NRS/NIFA relocation in  term one. One of the most important lessons that we learned was instead of looking all over the map, literally, for where we should go, if we are looking to relocate, the first thing we should do is see where we already are.”

Senator John Hoeven, R - North Dakota: “But there’s a difference between you selecting five hubs on your own and saying, okay, we are at the start of the plan and we are going to talk about it but this is the plan, that’s different, than if we work together and come up with a plan that people have had input, they’ve been fairly heard and fairly treated, it may be different than five hubs and may be different than these locations and it may be different in form and function, but it is something that ultimately this Congress has something to say about, both from an authorizing standpoint and certainly from an appropriations standpoint.” 

For Market to Market, I’m Peter Tubbs.

Yeager: U.S. Railroads have undergone extensive consolidation since deregulation, 45 years ago. There were more than 30 major freight railroads in the early 1980s. Today, there are only six. That number could be changing soon. If regulators approve a deal between the country's first and fourth largest rail companies. David Miller has the story.

David Miller: Rail giants Union Pacific and Norfolk Southern have agreed to a merger valued at $85 billion. If approved, the two companies would come together under the Union Pacific label, control over 50,000 miles of track in 43 states and be the first transcontinental railroad in U.S. history under a single brand.

Matthew Gustafson is a professor of finance at Penn State University.

Matthew Gustafson, Professor of Finance, Pennsylvania State University: I think, before they go through the operational challenges of, you know, figuring out how to allocate their employees across the newly formed company. They're going to wait and see what the, regulatory agencies say about things.

According to company data, Union Pacific moves 1.6 million carloads of grain annually and Norfolk Southern transports 18,107 carloads of grain and grain mill products every year. 

Union Pacific CEO Jim Vena says they hope to eliminate $1 billion in costs annually, and no union members should lose their jobs. However, the workforce could shrink due to attrition.

SMART-TD, the nation’s largest rail union, opposes the merger due to safety concerns with both rail companies. The Transport Workers Union echoed those concerns by saying the deal delivers “billions to Wall Street while workers get shafted.”

The two companies hope to get approval for the deal from the federal Surface Transportation Board by early 2027. 

For Market to Market, I’m David Miller.

Yeager:The White House cut funds already allocated for the Corporation for Public Broadcasting. This will have a financial impact on all public media stations, including the one where we originate this program.

Part of the defense against those cuts was the impact on rural viewers and listeners. 

Private newspapers have also been folding as pressure to keep readers engaged and buying subscriptions has forced consolidation. Efficiencies are part of this, but so are the loss of watchdogs focusing on local government, schools and communities. However, the smaller the circulation size, the better the chance a community is willing to support and help keep the information flowing. Colleen Bradford Krantz has more in our Cover Story.

Krantz: The sun has barely risen when four women begin their work in the back room of the Hillsboro Free Press in Hillsboro, Kansas. Within an hour, they are joined by middle and high school students who will deliver the papers – under the watchful eye of school employees – as part of a life skills class.

Paula Jost, paraeducator, Marion County Special Education Cooperative: “We were able to get one of the paper routes so we come and pick up the papers and fold them on Tuesday mornings and then deliver ...one of the paper routes…. It teaches them work ethic and that’s what our classroom is about.”

None of this might have been possible if it weren’t for Joey and Lindsey Young. The couple took over the Hillsboro Free Press, and run two other south central  Kansas newspapers during a period when many might have looked at industry trends  and fled.

Joey Young, Co-Owner, Kansas Publishing Ventures: “It’s just that I really liked it. And it was youth and ignorance. It was just that abundance of 20-something-year-old attitude that you are indestructible and that older people don’t know what they are doing…And I think there are certain things that we did better. And then there were a lot of things that I needed to be humbled with and that I was, you know, just flat out incorrect about.”

It was 2012 when the Youngs bought their first newspaper, The Clarion, in Andale, Kansas.

Joey Young, Co-Owner, Kansas Publishing Ventures: “Lindsey and I lived like paupers. We saved my copy desk salary for six to eight months, something like that. We sold a car to get enough down payment and enough to put in the bank, which was still not enough, to purchase the paper.”

The Youngs – with their money and time invested in keeping local journalism alive – are part of a shrinking group. According to Northwestern University’s Medill School of Journalism, the United States lost more than one-third of its newspapers over the past 20 years. The nation now has 208 counties without any local news source at all, areas Medill calls “news deserts.” 

If given the choice, Joey Young wouldn’t change the path that led him from his job at a daily newspaper to where the couple operates their Kansas Publishing Ventures out of the Harvey County Now newspaper office in Newton. But he would change the conversation about local journalism if he could.

Joey Young, Co-Owner, Kansas Publishing Ventures: “All I hear is…this really depressing statistic that everybody likes to throw out to claim that newspapers are dying. Never is there a follow-up to where like, ‘Hey, that town lost 50 percent of its population over the last 20 years’…If you’re losing Main Street businesses, do I think that there’s a magical answer for sustaining journalism in your community? No, I don’t. You have to figure out how your community is going to survive. If your community is going to survive, a newspaper will survive.” 

To make sure community members and business owners keep a bit of their focus on their local newspapers, the Youngs and their employees have done everything from a Halloween-themed toy ghost treasure hunt in downtown businesses, to hosting an annual concert in a local park, to a Friday community happy hour in the Newton newspaper office.

Joey Young, Co-Owner, Kansas Publishing Ventures: “We used to have a Democrat elected to the statehouse, which represented Newton. He came for a Beer Friday. So did the local head of the Republican party. And we were all just hanging out having a beer. And I was like ‘This is great.’ You know? This is America. This is the way things should be …having civil conversation…being a part of the community, which I think is special.”

He knows not everyone is interested in being engaged in their local community but enough still see value in it.

Kelsey Nicklesen, Newton, Kansas: “(A lot of these small towns, you know, the people who live there grew up there and know just about everybody.) When you have a local newspaper, you can connect to those people you’ve known. You can see if someone you know is like the homecoming king or queen, who is in the games as far as sports, what kind of local events are going on like festivals.”

But the financial struggles are real. When paper prices spiked during COVID, the company struggled to break even. Instead of suffering quietly, the Youngs were honest with their readers and put out a survey to see whether they wanted to rely strictly on the digital versions, or pay a little more to continue the printed versions.

Joey Young, Co-Owner, Kansas Publishing Ventures: “Nine out of ten of our readers said they wanted a print paper and that they would pay more.”

Nearly 90 percent of subscribers stuck with them when they went ahead and doubled the subscription fee.

Throughout their dozen years as publishers, the Youngs have struggled with recruiting journalists as some aren’t sure about living in smaller communities. They are not alone with this challenge as other rural news outlets also struggled with new recruits. As a former high school journalism teacher, Lindsey came up with a plan for non-journalists called “Earn Your Press Pass.” The training is now available through press associations in 21 states.

Lindsey Young, Co-Owner, Kansas Publishing Ventures: “This was just a way of saying: here’s someone who has lived in our community for 20 years, they’ve put kids through the school district, they work here, they know everybody. Let’s just teach them how to write and do a good interview and now they can be an asset for the newspaper.” 

Lindsey cringes to think of a future where more counties become “news deserts.” She believes that “ghost papers,” where the product is still there but with no local reporters, are not much better.

Lindsey Young, Co-Owner, Kansas Publishing Ventures: “We take a lot of pride in just making sure that local governments are doing the right thing. Just having a person in the back of the room, it’s amazing how much that holds people accountable to make sure they are doing the right thing. So I feel like we are protecting our taxpayers too.”

Ultimately, it’s also the upholding of the newsroom’s traditional task of being the recorders of the “first rough draft of history” that matters to her. 

Lindsey Young, Co-Owner, Kansas Publishing Ventures: “I think for us as community newspapers, we are the only recorders of history. There isn’t anybody else who is writing this stuff down or reporting on it. Being such an intimate part of a community and being a place where people trust you with their stories and with what’s going on, I think that’s such a gift and it’s humbling and it’s really fabulous to be part of. So I’m absolutely 100 percent am head-over-heels in love with the industry.”

For Market to Market, I’m Colleen Bradford Krantz.

Announcer: Next, the Market to Market report.

Paul Yeager: For the week… The nearby wheat contract fell 22 cents and the September corn contract lost a dime. A lack of progress with China on a trade deal held back the soy complex.  

The September soybean contract dropped 33 cents, while September meal added $3.10 per ton. December cotton contracted $1.87 per hundredweight. Over in the dairy parlor, September Class Three milk futures declined 6 cents. The livestock market was mixed. October cattle found 53 cents. September feeders put on $1.73 and the October lean hog contract declined 55 cents. In the currency markets, the U.S. dollar index improved 147 ticks. September crude oil expanded by $2.13 per barrel. COMEX gold gained $4.90 per ounce, and the Goldman Sachs Commodity Index was down by more than a point to settle at 547 - 05. Joining us now to help us in our discussion, analyst Matt Bennett. Hello, sir.

Matt Bennett: Hello, Paul.

Yeager: You're not going to smile much today, I don't.

Bennett: Think we can smile some.

Yeager: We can. And it's not going to start with wheat though. This is going to be a common topic. Wheat needs what to rally. Is it a trade deal first?

Bennett: Oh, yeah. You would certainly need a trade deal. The tough thing with wheat, of course, you got big global supplies. You got big. U.S. Supplies. A lot bigger than a year ago. Around 100 million bushels. And so, you know, you've got harvest 80% along, which is is pretty much average. But, you know, whenever you've got harvest pressure like that, export sales are pretty good. But look around. What else is there? There's just not much right now. It's tough. Spring wheat isn't in fantastic shape. All right, 50% or so good to. Excellent. But for the most part, it's good enough considering all things, because we know we're going to have a big wheat crop overall. And bottom line is there's just too much wheat sitting around.

Yeager: It's also going to be a lot of corn. We'll get to the December contract a minute. I want to start with September. We still have a lot of old crop. You would think, if you believe the anecdotes online, is there.

Bennett: Yeah. There's less than last year. Okay. First of all. But there is still some corn around. So last week we actually saw some processors in our area push basis a little bit and said, hey, if you deliver next week, they were actually pushing from 18 over to 35 over. That lasted a few hours, you know, because there's a lot of guys that said, yes sir, I'll take that. And so, you know, of course that makes sense to someone who's kind of been sitting around waiting. If you look at it, Paul, I mean, we were pushing up around $4 at the time on September corn. So 435 corn. Take that versus what you saw in the middle of fall last year when basis was fairly wide. You know, you're a lot of guys were selling and gals were selling 3.50 across the scale. Now, I know you had to hold on to that for quite a while, but I think if it was in your possession, you can do that for $0.85.

Yeager: Well, let's discuss that thing that you're facing that's out there growing. I want to start with a question here. Let's go out of Ohio. Neal has the question for you, Matt. Will it be until the combine starts to roll that the too much rain thing will finally be acknowledged by the market? Or will it only be traded after the January report?

Bennett: You know, the thing is, is that we know from the thermal imaging, from NDVIi, I mean, the crop looks fantastic. Okay. As far as you know, what kind of organic matter or just leaf content, I mean, it's just beautiful. Chlorophyl filled, filled corn, not dead at all. I mean, there's really not a lot of dry spots out there. The thing is, though, Paul, too much rain can cause issues. We know a lot of guys sprayed fungicide, but are they going to have to spray the second time? You know, we've heard especially in the state of Ohio, I mean, you've had areas 10 to 15in of rain over the last month. I mean, that's that's quite a bit of moisture to have to deal with. And so we've heard folks say, well, I can't spend 40 bucks an acre on fungicide. I understand that corn at $4 on the board, it's pretty tough for you to say, hey, I'm going to spend ten, 12 bushels. But the bottom line is, Paul, if you get to our spot or you get southern rust, you could lose 50 or 60 bushels. So if you're in a well above APH situation, it would behoove you to protect that crop as good as possible. As far as the question goes, yes, there's areas that have had too much rain, but we've seen in the past it's a rare occurrence that too much rain ends up hurting a crop so much that you end up driving the market higher. Can it happen this year? Absolutely. Crops not in the bin yet, but it sure looks to me like the USDA at 181 might be a little bit low at least, versus this August number.

Yeager: Okay, so if I don't say I don't buy the 186 187, just say I buy 184 185 what does that mean on carryout? What does that mean for my decision making at at Harvest and beyond?

Bennett: Well, there's some moving parts. So at a 181, you know, at a 166, which is what the current forecast is, you got to ask yourself how much export business might we lose to the Brazilians? You probably lose a couple hundred there. So maybe you're starting out at like a 185. And then you tick that up. Let's say you go three bushel, and now all of a sudden you're adding 250 million bushels. So you could be a little bit above $2 billion. That certainly feels like a pretty big number. But Paul and the trade right now, in my opinion, is probably trading 185 plus. It sure seems like it to me. And I would say a lot of people agree with that. But moving forward, Paul, I think you could shift the paradigm a little bit on corn, corn fertilizer ratio is not good. It's a second worst we've ever seen. Back to zero eight. If you look at what phosphate prices are, if you look at the farmers liquidity position, I think that you're going to find this fall the application rates of dry fertilizer are going to be probably a multi-year low. That's my opinion. And I think some alarm bells could sound when some of these guys start talking about tonnages. And I got to think at some point the funds are going to say, okay, the law of diminishing returns has hit us. We're going to have to start lifting these. I don't think they lift yet because commercial traders, they really haven't bought, you know, they're on the commitment of trade. You don't see a whole lot of sales there. They haven't bought much off the farmer. I think the funds are going to stick around and see that farmer sell.

Yeager: A lot applies to the soybean crop as well. Do we have as much still left to sell of old crop?

Bennett: No, there's not a whole lot of beans.

Yeager: So if you have it, do you hold it right now? Since we're where we're at price wise?

Bennett: Well, if that was our mentality 2 or 3 weeks ago, it sure didn't pay off. And I'm not I'm not making fun. It's this has been a tough year to market, Paul. Let's just be honest about it. And so if you've got old beans now the problem is we're coming up on harvest. You know, in the Delta, they're going to start picking corn here before too long. We're going to see some beans harvested as well. To me, holding on to old crop beans, you've got to you've got to hope for a regional issue where someone really needs some beans to crush quickly. If you don't get in that scenario, I'm afraid that holding on to them is going to be a tough game. Unless Mother Nature throws something at us. Now, these forecasts over the last several months, they kept forecasting dryness in the Western Corn Belt. The models were incorrect. The models right now are saying that August is going to be a little bit on the drier bias for Illinois and Iowa. If the heat comes back in and you get some dryness, maybe you get a pop in this bean market. But if you do, I think we ought to know what to do with it.

Yeager: New crop side on the November contract again. Still, I would think it sounds like the same scenario that you just talked about. Matt, for corn.

Bennett: Yeah. I mean, the thing is, is that I can see holding on to corn is paying off for someone. I've got to think that when you get into a scenario that people are talking lower acreage, we don't know if Brazil's going to have a big crop this next year or not. And quite frankly, world supplies are shrinking whenever it comes to corn. World supplies are not shrinking when it comes to beans. So essentially, when you look at that world balance sheet, we're producing more than what we're consuming. And that's not necessarily something that I want to store. And so in all honesty, I have a hard time storing beans in here. Now, if you do to me, you've got to do so. Maybe if you can do so at home. But most guys don't like corn beans at home. It's just traditionally not something we do.

Yeager: Let's move to livestock quickly because October live cattle. Another all time high. Then what happened?

Bennett: Yeah. And then we just sold off a huge sell off there on Thursday. Tried to gain back a little bit Friday, but it really wasn't anything to get too excited about. The thing is, the cash trade is still incredible, you know, high two 40s. You've got to think that that had something to do with maybe a little bit of this rebound on Friday. But I've got to think the funds are sitting here looking at how much money they've made being long. The cattle market fundamentally it looks fantastic. Still, people keep asking, when's the top going to be? The top is going to be before anyone thinks I don't know when it is Paul.

Yeager: I've asked it probably 15 times.

Bennett: The thing is, is that a person that has a lot of exposure just has to understand that a day like Thursday could be followed up, since feeders went down the limit by a $12 lower move on Friday, it could have happened. It didn't happen. Thank God, but that type of a move is what is going to be. What happens when the funds say, hey, you know what, we're tired of this long. We're going to move out of it.

Yeager: Hogs have had a rally then. We are now back down to about that 100 day moving average. What does that mean?

Bennett: I mean, all honesty, you know, demand has been good. Exports have been fairly good. The thing with hogs though is they've kind of followed cattle along. And I don't think hogs would be near where they're at if you would if you weren't seeing these really big cattle prices. All time highs three out of four days at one point this week, I wouldn't want to be real long hogs, especially if you see a cattle sell off.

Yeager: It is interesting times there's been. There's no doubt about that one. Matt. So we have more. I do have a question about poultry tied to livestock that I'll ask you in Market Plus. Okay.

Bennett: Yep. Absolutely.

Yeager: That's your warning. Thanks, Matt. Matt Bennett everybody. And you have been watching the analysis segment, and in a moment we will continue our discussion in our online only segment, search Market Plus with Matt Bennett. Wherever you get your podcasts to hear that conversation. Or you can also go to our website at Markettomarket.org. We've been on Facebook for years and many of you have been loyal to us on that platform. So give us a follow. If you're not there with us, or hop back into our conversations at Facebook.com slash Market to Market. That's the account MarkettoMarketshow. Next week we are going to talk about that fight over busting the swamp to farm. Just a few more acres. Thank you so much for watching. Have a great week.

Announcer: Tomorrow's agronomic challenges. We're committed to creating what's next because a 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 fuel the world.

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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