Market Plus with Mark Gold

Paul Yeager: Welcome to the table for the Friday, May 9th, 2025 installment of Market Plus. Joining us now, Mark Gold slow week in Chicago, Nothing to talk about.

Mark Gold: No. You know, having a Pope come from your hometown. As you know, it happens. But I guess it hasn't happened. That's what's big news in Chicago.

Paul Yeager:And you thought it would take a lot more to knock the Cubs off the headlines? Yeah. I mean, the way they're playing right now.

Mark Gold: And the Cubs have been playing pretty good ball. But, turns out the Pope is a White Sox fan, so that's something we can't forget to say. Happy Mother's Day to the mothers out there.

Paul Yeager: Well, mothers are looking around at these, they're going to be busy watching headlines this week about tariffs. What do you expect? I mean, we're it's the US sending the Treasury secretary and the trade rep. Those are not low level people. No. That's a significant sign. What does that tell you about the tariff talk?

Mark Gold: Well, you know, we did this deal with Great Britain really wasn't much of a deal, but it was something, you know, it's good for beef, good for steel. I don't think it's possible to get a real deal done. There can be a framework agreed upon, but is it going to be a real deal? Who knows? But what I'm hopeful and praying for is that the Chinese will at least say, okay, we're going to honor phase one, and we're going to buy the billions of dollars of agricultural products we promised. And it was in 2018 that we never did they blame Covid. We didn't need it because of Covid. Okay. We don't have Covid now. yeah. You're economy is not doing great, but you got to feed your people. So, you know, hopefully that will come out of this deal if that happens. Corn, wheat and beans all should move higher just on that news.

Paul Yeager: The president has shown little patience for slow moving talks. Does that hurt or put extra pressure on negotiators in all of these trade talks?

Mark Gold: Well, I think you saw the deal with Great Britain that he wanted to get something done, made the phone calls to get it done, and wanted a deal. Second to happen with the Chinese? I don't think so.

Paul Yeager: But is that a lowercase “d” deal or a big deal? Because the tariffs were, I think, very low six months ago, 10% when they came in. In negotiation they're leaving at 10%. Yeah. Little changes in other areas. Yeah.

Mark Gold: Yeah. In my opinion it's a little “d.” Yeah. But it's a deal. And that made the headlines and that was helpful for the stock market. They said firmed up for the day but the big “D” is China. The big “C” is China. That's where we need the business. They need the grain.

Paul Yeager: So so are you of the opinion then that if there's no China we're in trouble?

Mark Gold: No, because the Chinese haven't bought much anyway. You know, there are ten year lows on imports of soybeans from everybody.

Paul Yeager: I say not including Brazil. Yeah.

Mark Gold: Including Brazil. So it tells you that their economy is so bad that they're just not buying as much. They've cut back their hog rations meal, soybean meal and their hog rations. Good place to start if you want to save some money and, say buying beans. But the fact of the matter is they're going to need the grain and hopefully we'll see something positive.

Paul Yeager: The chart here is it's pretty rangebound in that. 1045 we close ten 51.75 on Friday. It's kind of been where we're at. Is that a little bit, though? Thursday, Friday in anticipation of Monday, more than other factors.

Mark Gold: You know, is it the trade deal over the weekend? Is it the weather which is turning drier? Is it wisely looking to maybe shave some more? We expect 5 million cut off the old crop beans, 20, 30 million off a new old crop corn. So maybe that's part of it in here. But, Monday, I think it's going to be a very interesting day. We've got first the inspections and we got the WASDE the results of whatever out of the trade deal is going to be there. And then we've got crop progress. So it's going to be an interesting day all the way around.

Paul Yeager: Yeah. You've been saying it all week about it will likely double progress.

Mark Gold: Yeah I can't imagine we wouldn't.

Paul Yeager: Yeah I mean there's been a lot of good dry days in a lot of areas except in the East.

Mark Gold: You know, if you want to see how fast American farmers can get a crop in the ground, just take a look at the numbers. On Monday, in states like Illinois, Iowa, Nebraska, Kansas, and the rest of them, you'll see how quickly they can get it in.

Paul Yeager: Well, let's talk, Wisconsin here, if we could. Gary in Wisconsin wants to know more. Good all around export numbers did not move the market. Does this mean that the traders are only looking at the possible large new crop or are they just waiting on USDA numbers.

Mark Gold: If they're looking for new crop and that's all they're looking for? I think they're looking at the wrong thing, particularly this time of year. I say that because the USDA is going to plug in trendline yields. We all know that these crop progress numbers are going to be huge. And if that's the only thing they're looking at okay, we get the corn in the ground on time on schedule. Great. Now it's a weather game. Now it's a trade deal game. So and WASDE game to some extent though this report, you know, isn't going to be that critical unless they really shave the corn numbers. I think it's going to come down, but not as much as I'd like to see it come down.

Paul Yeager: Traditionally, it takes a lot to move USDA off of plugging in trend lines in May. Yeah, and almost in June. What does it take to knock off and start wobbling? Some of these?

Mark Gold: I don't think you'll see it until at least July because the June numbers, nobody's going to come off of those numbers in June. I don't care if we're hot and dry right through the end of May. I don't see anybody changing those numbers because, you know, really, what does it mean? Is one good rain? We're good if we don't get those good rains in June now, they're going to take notice. And that July WASDE should start to cut it back.

Paul Yeager: Or we have to have like what we had in 2020. I mean, that was a market mover that I mean, I'm not saying that they're immune to making the same mistakes but or same assumptions.

Mark Gold: You know, I think they generally try to keep it, you know, what are we doing. The guesses not go too far from that. You know, in the flood year. What was that, 93. Yeah. Maybe they made some changes there. but I, I don't really see them changing it too early.

Paul Yeager: Let's talk numbers again. For years you mentioned 93. You also mentioned 88 during the main program. We've heard whispers of 2012. If you look at data from drought monitor maps at this point in 2012 to now, you see more drought on the map. Does any of that give us something to look at, something to ponder?

Mark Gold: I think it does. What it doesn't do is give American farmers the green light to go get long everything and not sell a pound because, again, in 50 years, I've seen so many of these weather gurus, and in my opinion, they certainly tend to the bull side, because that's what you remember. I remember it made me a ton of doing the ‘93 or ‘88. And, you know, here's my guy, and we've certainly seen in the last 5 or 6 years, guys get it absolutely wrong. So, you know, do I want to be telling farmers now load the boat because of what's happened? It looks like ‘12. It might look like ‘88. No. But you got to keep your eye on it and watch how this thing starts to move. And if we, you know, have any kind of good news on Monday, would I be looking at buying calls back to replace anything I've sold that I might do for sure.

Paul Yeager: Last thing on the weather. We talk about genetics and seeds changing. So is the weather forecasting. Yes, the science and what we look at, we can make ourselves numb looking at so many numbers and charts. So you do. There's a little moderation here, right?

Mark Gold: A lot of moderation.

Paul Yeager: Fair enough. All right, let's go, Mike and I'll if we could for Mark, even with all the good demand for corn, it just seems to want to go down. Where's the bottom?

Mark Gold: I'm hoping, you know, sometime soon. But, you know, even in the 88 market where we had all that heat, we didn't make our lows until the end of June. And it was really, you know, that's when we saw some good things happen. In ‘83, we made the lows on June 30th, had the PIC report, and then things took off. Then we are hot and dry over the 4th of July and then boom. ‘88, we made our highs earlier that year actually in June and then started to back off. And then mid-July it just tanked. so there are some similarities. We can't have a rally in June, but most likely it's got to be pretty severe to see that happen. That's why I can't tell anybody. You know, just lay it all down on the line and, you know, step up to the crap table and roll the dice. But what you can do is look at doing something realistic and rational, which is if we start to get, the more we start eating into it and it's drier and drier and a few more calls on it.

Paul Yeager: So if I hear what you're saying, we're not in the gamble mode yet, we are much more. We still have an opportunity to be, to play something safe.

Mark Gold: I'm never in the gambling mode, okay? Except when I'm in Vegas and I am. But when it comes to managing risk for farmers, I'm never in that mode, in that rain.

Paul Yeager: But if we, let's take the premise of the question continuing to go lower. Yeah. We start. We take another $0.25 $0.50 off a corn, heavens to say, a dollar. Then you start to get a little more nervous, don't you?

Mark Gold: Can corn going to $4. Yeah. It could. Is it going to happen or are we going to go to $3.90? I don't believe we will. Between inflation and everything else that's happening in this country and not ideal weather to start with, here, I don't think it's possible. Okay. Can we go to $4 corn, $4.10? Yeah. It's possible. I think the odds are against it. I don't see there are a couple of options plays that make some sense in here on the put side, but not many. It's not a no brainer. And you know again you want to spend $0.10 or $0.15 on corn, hope you lose every penny of it and corn goes to $6, let's do that. Yeah. Let's have some fun with this for a change.

Paul Yeager: Well, let's go higher with the last question then. Cannady Farms in Oklahoma and this is with the rain in the Southern Plains and a break in the drought in that area, are we likely going to start seeing a growth in the herd? If so, are we well on our way to $3 feeders? Yes, I know we hit $3 ahead of this taping and when this question was written.

Mark Gold: Yep. The question becomes can we sustain $300 feeder cattle? I, I agree with his premise that maybe pasture should be picking up here looking a little bit better. Maybe they'll put some more cattle on feed or in the pastures and raise more cattle out here. And I think that's a good thing. I don't know what's going to turn the cattle market around, but I think we've got to see it break in the box beef first so that the consumer is saying, okay, we're done and we're going to switch to something else. So until that happens or until we see a bigger supply for whatever reason, whether it's cattle coming in from Mexico or anyplace else, you know, it's hard to be bearish the cattle. But again, in historic highs, you cannot be complacent and not do something to help manage that risk without taking on more risk.

Paul Yeager: We've done something with you. We've had a good discussion.

Mark Gold: Thanks, Mark. Appreciate it. Thank you very much.

Paul Yeager: Good to see you.

Mark Gold: Good to see you.

Paul Yeager: Mark Gold everyone. A reminder to get signed up for the Market to Market Insider newsletter. It's free. Sign up at Markettomarket.org that's open anytime. By the way next week we are going to have a look at a long running midwest refugee center that is worrying about the future. And we'll have the commodity market analysis with Matt Bennett. Thanks for joining us. Have a great week.

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