Market to Market - August 8, 2025

Paul Yeager: Coming up on Market to Market, a report card on water quality. More tariffs go into effect. The fight over busting the swamp to farm a few more acres. And commodity market analysis with Don Roose next.

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: 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.

Speaker: This is the Friday, August 8th edition of Market to Market, the Weekly journal of Rural America. Hello.

Speaker: I'm Paul Yeager. This week President Trump made good on his threat and raised tariffs on more than 60 countries that have yet to make a deal with the U.S. Tariffs on imports now range from 10% to 41%. Stock markets around the world took the change in stride. Now, there would appear to be some progress in leveling the playing field with other countries, but economists say there is a cost. The U.S. Trade deficit. A comparison of the country's total imports and exports narrowed in June on a sharp drop in the import of consumer goods. The trade gap with China shrank to its lowest level in more than two decades. But there is a 30% tariff on goods entering the U.S. And a 10% tax on goods going into China. Last week, the second quarter GDP figures were higher as front loading by wholesalers was recorded. Aimed at avoiding the increased import duties as spring rains came to Iowa, the nitrate level in the rivers that feed the capital city's drinking water supply began to rise past the EPA's mandated maximum. Action was taken at the water treatment plant, but the increased level raised some concerns. Multiple rural and urban sources were blamed for the increase, but one study put agriculture front and center. Peter Tubbs has more.

Peter Tubbs: This week. For scientists who contributed to the Central Iowa Source Water Research Assessment, presented the results of the study to the public. The project was commissioned by the Polk County, Iowa Board of Supervisors to assess the water quality of the Des Moines and Raccoon Rivers. The rivers serve as drinking water sources for 600,000 people in the Des Moines metro area. The assessment identified agriculture as the dominant source of nitrates in the water.

Dr. Jerald Schnoor, University of Iowa: You might ask, well, where's all the nitrate coming from? It's a good question.

Tubbs: The Central Iowa Water Works has struggled to remove enough nitrate from the source water to provide drinking water for the public. That meets EPA standards for nitrate. The water utility instituted a residential lawn watering ban for several weeks to ensure it would be able to provide safe drinking water to the community. Central Iowa has experienced high nitrate levels in its rivers for decades, and the Central Iowa Water Works spends upwards of $15,000 per day removing nitrate from the water. It sources. The assessment estimates that 40% of nitrate in the two rivers is from surplus fertilizer, 20% from animal manure, and 20% is fixed in the soils by soybeans.

Dr. Claire Hruby, Drake University: This is not an anti-farmer. We need every acre treated. We need every acre. Pick a menu of options. We know what works. We are rewarding a small percentage of our landowners for doing the right thing, and without regulation, we can't get the rest of the folks to do something. And let's just all apply fertilizer at agronomic rates.

Tubbs: Iowa Secretary of Agriculture Mike Naig believes that voluntary practices are the best path to lowering the nitrate load in the state's rivers, and that farmers are going to need taxpayer support to improve their practices.

Sec. Mike Naig, Iowa Department of Agriculture: If you want to see lasting change and you want to respect the fact that every farm field is different, and certainly every state and region is different, that the way that you do that is by providing technical and financial assistance.

Tubbs: For Market to Market. I'm Peter Tubbs.

Paul Yeager: The Swampbuster rule is a provision in the 1985 farm Bill that promotes conservation practices. The idea was to preserve untouched wetlands, to filter runoff and help with flood control. The penalty for noncompliance is a loss of federal farm benefits. This provision has been called federal overreach and a violation of the Takings Clause in the Fifth Amendment of the Constitution. We partnered with Great Lakes Now, which is produced at Detroit PBS, to tell the story of one landowner who challenged Swampbuster and the farmers who rallied against that challenge. Greg King has more.

Greg King: John Gilbert is a fourth generation farmer. He and his brother Greg raise hogs, beef cattle and soybeans on 800 acres of land in Hardin County, Iowa. 

John Gilbert, Gibraltar Farms, Hardin County,  Iowa: “In this era when we have virtual this and virtual that and virtual just about everything, the land is probably one of the realest things we have. And it is really something we need to be cherishing because quite frankly, all life on earth depends on how well we look after our soils.”

Nearly 120 miles to the east, Steve Besler and his wife Elle Guidant own a farm near Worthington, Iowa. 

Elle Gadient, Besler Century Farm: I grew up on my family's farm. Oh, about 20 miles southeast of here. 

Steve Besler, Besler Century Farm: “It's something I've always loved. My first task as a kid was to put eggs. And from there we went to bottle feeding cows. We dairy farmed and raised hogs growing up. Farming has been in my blood and it's thick as can be, so there is no doubt in the farming out of me.”

King: It's safe to say that for Steve, Elle and the Gilbert brothers, farming is a way of life. But there's a pending court case that could impact their way of life by stripping away what many environmentalists consider to be the last guardrail against the destruction of precious wetlands. 

The case is CTM Holdings, LLC versus USDA, and the guardrail is a provision in the U.S. Farm Bill called swampbuster. 

Katie Garvie is an attorney with the Environmental Law and Policy Center in Chicago. She's intervening in this case, representing Iowa farmers. 

Katy Garvie, Environmental Law and Policy Center: “I don't have any reason to doubt that the plaintiff feels genuinely and subjectively aggrieved that he's not allowed to do whatever he wants with his land and get free money from the government. But that is not a legally cognizable injury.”

King: Jim Conlin, a hedge fund manager in suburban Chicago, is challenging swamp buster by suing the federal government. His investment firm, CTM Holdings, owns more than a thousand acres of farmland in Iowa.

The land at the center of this court case is a 72 acre parcel near the small town of Delaware, Iowa, population 140, which Conlin rents out to a local farmer. About nine acres of that land are considered wetlands. Under the swamp buster provision, the USDA pays Conlin in the form of subsidies for not plowing those nine acres. 

Conlin argues that the swamp buster provision is unconstitutional. 

Jim Conlin, CTM Holdings: “And the reason I say that is because the federal government prohibits it from being used for anything that has any economic value at all. You can't farm it. You can't build on it. You can’t clear it. You can't take the stumps out of it. And the underlying land is probably worth 20,000 an acre, if you could. It's worth zero. It's actually worth less than zero.” 

King: But Swampbuster is purely voluntary. So why doesn't Conlin just opt out of the program? 

Jim Conlin, CTM Holdings: “You couldn't participate in any of those programs that would make it difficult for a farmer to rent that land, because the federal government's involvement in agriculture is pervasive.  It's difficult for a farmer, a renter, for example, to operate without USDA support.” 

King: Conlin maintains that the nine acres of wetlands on his property are not always wet, and are not connected to any other body of water. 

Jim Conlin, CTM Holdings: “I've never met an actual real farmer that has anything good to say about the wetland laws and regulations. They despise them. I don't know who the hobby farmers are that are near there, or what environmental groups they're part of, but if you interviewed 100 farmers in Iowa, various sizes, I don't think you could find one out of that typical hundred that would share that view.”

King: But contrary to what Conlin says, there are about 2,000 farmers in Iowa and South Dakota who are fighting to save swampbuster. 

Gilbert and other farmers are concerned about increased flooding on their farms if Conlin wins and swampbuster is overturned. wetlands slow water down, storing floodwater and preventing it from inundating farms, homes and riverfront towns further downstream. That's why Steve and Elle are concerned. 

Elle Gadient, Besler Century Farm: “We're downstream from the land in question in this lawsuit. We're about 12 miles southeast of this wetlands in question. And this is far greater than one stream and one wetland in Iowa. This directly comes down and affects us and affects our neighbors.”

King: A recent study conducted by the Union of Concerned Scientists found that 30 million acres of wetlands in the upper Midwest, including the Great Lakes region, provide nearly $23 billion in annual flood mitigation for homeowners. Over the long term, the study estimates that protecting these wetlands could prevent between $323 billion and more than $700 billion in residential flood damages in the upper Midwest. But for Conlin, this case comes down to the rights of landowners. 

Jim Conlin, CTM Holdings: “I'm pro-environment. I'm I'm, I'm pro collective action, but I'm also pro property rights, which is if you're going to take from me for the benefit of society generally, including me, you have to pay me.”

King: For the farmers fighting to keep Swampbuster, the lawsuit hits closer to home. 

John Gilbert, Gibraltar Farms, Hardin County, Iowa: “Those of us who work the land will leave footprints and shadows on the land. You know the ethic we have, the relationship we have with the land is totally foreign to a lot of the outside people who are coming in and basically prostituting the land.” 

King: On May 29th, 2025, a federal judge ruled against CTM Holdings. CTM and the Pacific Legal Foundation said they planned to appeal, but no appeal was filed before a July 28th deadline. 

Announcer: Next, the Market to Market report.

Paul Yeager: Increased export demand helped, but was not enough to overcome ideal weather and a larger than expected private estimate for the corn crop. For the week… The nearby wheat contract fell 2 cents and the September corn contract lost seven cents. Limited export business kept the soy complex lower for much of the week. The September soybean contract weakened two cents, while September meal improved $5.70 per ton. December cotton expanded by 24 cents per hundredweight. Over in the dairy parlor, September Class Three milk futures gained almost nine percent or $1.50. The livestock market was higher. October cattle was up $2.30. September feeders put on $6.45 and the October lean hog contract found 63 cents. In the currency markets, the U.S. dollar index dropped by 90 ticks. September crude oil contracted by $3.33 per barrel. COMEX gold gained $59.70 per ounce, and the Goldman Sachs Commodity Index was down by almost 8 points to settle at 539 - 10. Joining us now is regular market analyst Don Roose.  Welcome.

Don Roose: Glad to be back, Paul.

Yeager: Don. There was a conversation with some farmers. This week was about the end user. Is this, is the end user's time? Let's specifically talk about wheat. Is this, is this their last hurrah? Because that means we've got the low end. That's really what everybody wants to know.

Roose: Well, you know, I think when you look at the wheat market seasonally, this is a time of year where you can put in a bottom. So I think it is trying to forge a bottom. Paul, last year, September wheat forged a bottom for 94. August 26th this year so far we've had a low of 504 carryouts very much similar. You know, support on the downside, but rally still run into a lot of resistance because we hit too competitive.

Yeager: Well. Competition has been part of the story here. We'll get to exports in a moment. I mean I guess has the export train coming for us grain, U.S. Wheat that is.

Roose: Well, you know, it's just competition. I think we've got to be the cheapest wheat in the world, cheapest corn and the cheapest soybeans. But then when you rally just a little bit, we become uncompetitive. It's that tight of a market. So I would say it's. And that's what you mean when you're trying to forge a bottom, you know, it's one that takes time to build a base.

Yeager: Well, you see there on the December wheat chart. And when we're going to show you the corn chart here in a minute, because you talk about the exports, this, this old crop, there is still this optimism that it can't get much lower. Can it?

Roose: On the corn market. Yeah. Yeah. I think when you look at the corn, it's last year we bottomed at 300 60.5 on September corn. So we're well over that right now. So far this year we went to like 370 just over 375. So the timing last year we bottomed August 24th. So you're in that window that you could. But I think it's one of these markets Paul that it's we're trying to see where end user demand really picks up. We're trying to see you know where these spreads start to narrow in a little bit when old crop supplies get cleared. So I think it's just one of those that takes time. It's the wrong time of year to be overly positive on the grain market going into harvest. Paul.

Yeager: We've not been overly positive about the grain in a little while there. At least the ones that I talked to at the Iowa State Fair this week in Iowa. There's an estimate of more than 220 bushels to the acre for Iowa alone. Then I talked to these farmers who whisper the three. There's a big crop out there, this new crop. What's the biggest pressure? Where is it coming from with new crop right now?

Roose: Well, you know, I think partly it's old crop supplies are being cleared. We've got pressure from the south, the delta starting to harvest corn. They probably harvested so far, 70 million bushels. Put it in perspective. Louisiana is about 25, 30% harvested. So we're getting pressure from that. But at the same time, on new crop, you know, you're seeing very limited selling here, Paul. You're for a lot of people you're down at below breakeven. So it's kind of a caution on making new sales.

Yeager: But then the exports came in Thursday kind of gave us a little spark. But then it didn't last very long. Like you were saying once you're no longer the cheapest, it quickly ends. How do we get back to having more interest in the export business?

Roose: Well, you know, and that's exactly right. I mean, the dollar has to keep coming under pressure. What we've seen is our new crop export sales have been very good on corn so far, but that's mainly because people pre-buying because of the tariffs coming on place. But you know, exports could be well overstated in corn and soybeans. A lot of it's going to be dependent on what happens with trade and these tariffs going forward. It's very much an unknown so far.

Yeager: Paul Tuesday is a USDA report. It is on acreage. Or we'll find out how big this crop is or at least the estimate. What are you thinking. What should a farmer be doing Monday Tuesday ahead of this.

Roose: Well, you know, I think from a producer standpoint really, you're down to on new crop. You're just kind of in survival mode, really, when you're below the cost of production. So you have to market for a dime's, not dollars right now. So that's the big one. I think you have to be careful of big carries in the market. I think the big thing you're looking for is how big is big on these yields. How how low is low. And you know, those I think will lead you home. But last year remember could this happen again. The highest yields of the year were in the August report. And we went lower throughout the year into the final. You know this year you know, what's it going to be? We saw some big private estimates come out. But also we are also hearing some concern. And a lot of producers tell me when you have a lot of moisture, you get a lot of denitrification and don't bet on the big yields. Like we're all talking. I was the epicenter of the big yields Paul.

Yeager: Yeah. And my 220 number was a private estimate that I used earlier. But Mitch in Iowa, who's in the northwest part of the state, he he wants to know at what price level does the risk reward trade off. No longer favor the funds holding their short positions on corn?

Roose: Well, let's put it in perspective on the funds. Let's just say they're short about 160,000 contracts. The record is about 360,000. So there's more meat on the bones if they want to press it. You know, let's put it that way. So I think what you know, from a fund standpoint, you have to prove that the market can quit going down before it goes up. And just like we saw here to end the week, we had a technical turn to the upside key reversal in wheat spiked bottoming corn, soybeans. You know, we rally up to resistance levels. Could not clear over some of these downtrend areas. And boom you slink right back down because it's the weight of the market. The weight of the harvest, the end user. When you have a big crop out here, is not in a hurry to buy anything yet. So the question clearly, answer clearly is you have to reach an area where you the funds for some reason, smaller crop, you know, something, a different trade policy. So haven't seen that yet. Paul.

Yeager: You talk about trade policy you mentioned earlier. Let's talk about it heavily with beans then, because there's one person, one country missing from a lot of these reports. We still haven't seen China come in to the marketplace. Is that what we're waiting for for a rally here?

Roose: Well, let's take the soybeans clearly. I mean, the soybean export pace could be 2 to 250 million bushels too high. You could have a carryout over 600 million on on the soybeans. The China has really been just absent. They've been buying soybeans out into October, November from Brazil. That's our market. So the longer this goes on, the more they're getting comfortable. It's risky for China when you're lining up with one one client, you know, so that's their risk. So we'll see how these trade negotiations go. But exports slowest number for new crop soybeans since 2021.

Yeager: So if I'm sitting there use the weather story. In addition to this trade story with my new crop beans. What's my course of action here in the next couple of weeks?

Roose: Well, I think on new crop soybeans, I think, you know, clearly the thing you're really looking at is do I want to pay storage and carry this market with eight cent a month carry from November to July? You know, like we were talking earlier, you're in survival mode. So if you're selling stuff below the cost of production, which, you know, it's for a number of people, it is you have to do something. Courage calls, give yourself a chance. Remember last year back to the corn. We hit a low of three 60.5 on September corn. But then in March or in February, March, corn went to five 21.5. Could it happen again? We'll see. Once you know, it's just a issue with demand picked up a little bit and the yield was too high in August.

Yeager: Too high live cattle, too high right now.

Roose: Well, I think when you look at the cattle market, you know, it's a spooky type of market because we're very high. We have not had a in this whole cycle. We have never had a week where we went Monday we went down the limit on cattle 725 to end the week. We went down 925 on feeder cattle. So we've never had live cattle. Feeder cattle go down limit in one week on Monday, expanded the limits on cattle. So it's going to get a little wilder. 1075 on fats and 1375 on feeders.

Yeager: In the feeder market. Then with with that volatility increased, does that mean that when you say you mentioned, you know, shaking the confidence of a of a trader, is it with a big number usually is what shakes someone's confidence. Is that what's going to take to maybe change this trajectory of the feeder market?

Roose: Well, what I've been telling people is it's very much like we're trading, you know, $9 plus maybe $10 corn. You're at that number on on live cattle. So you want to be careful. Breakevens on a lot of these cattle are 222. a lot of risk here, Paul. You know, you’ve got to be very careful. Black swan can happen. You never know. And consumer can back off anytime Packer loses. You know a lot of money right now.

Yeager: Well the consumer there's a big concern finally that May has come to roost with this cattle market that the consumer is maybe finally speaking and walking away from the market or from the counter. Are you seeing that? Hearing that?

Roose: Oh, yeah, most definitely. I think, you know, it's not quite the same. It's not getting quite the publicity. But remember when we had the egg prices so high, you know a lot of chatter there. We're starting to hear the same thing on cattle. You know you're seeing some of these ground beef where you're mixing beef and pork together. So you're seeing some strange things that you haven't seen before. And I always remind people, you know, the person that's really in control ultimately is the packer, because he can back away from cattle. They're cutting these kills pretty fast. It's, you know, very, very dangerous market up here. I don't think, you know, most people in the cattle business never thought you'd see these kind of numbers fall.

Yeager: And for this long, I mean, I mean, the length of time that we've been talking about this. And the same with the we need to move to hogs for a minute, but they have hogs have kind of rallied now too? Is this a correlation with beef or independent? What else?

Roose: No, I think it's partly, you know, the me too type of attitude. Like we were saying, you know, the cattle kind of pulled it up. But we've had disease problems with the hogs. And so the numbers are down. But our export pace is very strong and bellies are the highest they've been since 2022. So it's demand underneath. The market's helping us. But fourth quarter you have to be careful because we'll see what the supplies are in. The demand is. And particularly if cattle happen to stall out here.

Yeager: Final seconds, between, again, the highs in on these livestock I mean what is really can it prompt what can run us higher besides the black swan event.

Roose: Well you know at tops and bottoms of markets, Paul, my experience is that's when you accelerate, you put the most gains on. Is that what has happened in the cattle business? You know, like I say, when you start to see cattle go limit down, they they can hold it. But you got to start to that's a warning sign for the Bulls.

Yeager: All right. Thanks Don. Good to see you.

Roose: Thank you Paul.

Yeager: Don Roose everyone. And you have been watching the analysis segment. And in a moment Don and I are going to continue our segment in a thing we call Market Plus search Market Plus with Don Roose. Wherever that you get your podcast to hear that conversation. Or you can go onto our website of markettomarket.org. We do want to thank you for your loyalty to us on Facebook. Give us a follow or search out Facebook Market to Market show to jump back into that site with us next week. We look back at the most recent decade of this program. Thank you so much for watching. Have a great week!

Announcer: Market to Market is a production of Iowa PBS, which is solely responsible for its content.

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: 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.

Trading in futures and options involves substantial risk. No warranty is given or implied by Iowa PBS or the analysts who appear on Market to Market. Past performance is not necessarily indicative of future results.