Market Plus with John Roach

Paul Yeager: This is the. Friday, August 22nd, 2025 version of the Market Analysis segment for market to market. Welcome back to the table for the Friday, August 22nd, 2025 installment. Senior market analyst John Roach. John, I pulled a video found at 1977. You said in this, not in this building. You were in the other building. What's your earliest? And I'll ask you this Sunday at our event, but you've done market to market all these years. What's one of those lasting memories you have of coming to do this program?

John Roach: Quiet. It's peaceful and quiet. I'm around a noisy brokerage office most of my life, and I would come in here and sit down, and it was quiet and and there were clear questions. And I had to come up with answers in a very short period of time.

Yeager: Quiet? With Mark and myself? I don't think that was possible. There's not much quiet around me, but has the show changed? Do you think it's still the same? You're talking to farmers. You're trying to get them. You're trying to help them along. That doesn't seem like it's changed, but what.

Roach: Has it hasn't changed. I start out with a prayer to say the right stuff, that farmers hear the right stuff. It hasn't changed.

Yeager: Well, what you want them to hear is something about plants. We're going to talk about that in a minute. But let's start with Phil and Ontario if we could, because now you know you're global. You're a big deal, John. It's not just Iowa. You're all over. This is soybeans. They continue to buck the Uber bearish trend in corn. Is there a soybean fundamental story here or is it something else? I don't think that the something else is China. Can we get past that reality and get a further bean rally anyway?

Roach: Well, I think that it may be China. I mean, we've got unknown sales on the books. We don't know who they're going to, and they've really stepped up in the last month. And the people who've made those sales aren't talking about who bought. And so it may well be China. And the other aspect is that the demand has been without China. The demand has been very strong this year. And so we've seen the ending stocks be reduced as we've seen each of the government reports or almost each the government reports come out, the stocks have been reduced, which means the level of demand that we have for this next 12 months is big. We have a La Nina forecast for the new year, and that has potential to impact South America. And maybe they won't raise the big crop that they've been raising. So suddenly you go from having everything be big and surplus. The market quit going down on that news. And it started to move upward. On other news, which stimulated the spec funds. And then the fundamentals were given to us and they were better than we thought.

Yeager: Well, you have the Treasury secretary, I believe, picking up the phone and calling the head of the American Soybean Association, saying, hey, we're working with China. The market didn't necessarily bounce or bite at that. You didn't mention China during the TV show, but you you still are writing the soybean horse, as that is the good thing right now.

Roach: Well, I just think that the bad news of China has passed. Okay, okay. Will there be good news from there? Possibly. And meanwhile, the demand from around the entire world has been very strong. And so you have to pay attention to that. And China has yet to buy all that buying potential is still on the sideline.

Yeager: Potential is something that you can plan with. Or is it?

Roach: Well, it's something that gives you an opportunity. And what farmers have is an opportunity to make bean sales at a better price level than they had a month ago. Much better price level, almost as good a price level as they've had through the entire summer. And they've got an opportunity at almost the best price that they've had in a year to make sales for their new crop, 26 that they'll plant next year. And so the opportunity is here. Rather than trying to analyze why is it here and on and on and on, the better thing to do is recognize it. Take a look at the prices that are available versus your situation on the farm, your PNL on the farm, and recognize these are decent kind of price levels in surplus years.

Yeager: Well, there is one factor. We kind of alluded to it a little bit in the show, but Paul, in Minnesota is if there is if one is undersold on new crop corn, what would you do now? Storage. That's what I'm alluding to a little bit. There will be a scarcity this fall as the corn crop in their area looks terrific. So the question storage I asked you about selling corn beans and you said sell the beans. But if corn is a storage issue and those who have the storage are going to hold it longer or hold it at a higher price, do you still sell some corn with that scenario.

Roach: The way the market closed today, I think the corn market will rally a little bit next week. And on that rally, we're liable to trigger a sell signal. And if we trigger sell signals, you dribble some corn into the marketplace. The farmers need to have a system that they follow that tells them objectively. Markets have reached some sort of a peak, and they reach peak several times during the year. Each peak depends on what the fundamentals are and the apparent fundamentals at that time, and the technicals and everything else. But during those peaks, they need to take a serious look at their situation. And during one of those market peaks, if you're going to need to make sales for storage reasons or cash reasons or labor reasons in the next 60 days, you need to make some sales into those peaks. I mean, that's a strategy that we've been using for a lot of years, and it's successful. Sometimes you're making sales at price levels you don't like. They may not even be profitable, but if you need to, you need to. And so when you get a sell signal, you take advantage of it.

Yeager: Do you get the sense that there'll be some digesting of rain? Not as big of a factor, or rain not coming as much as it is in the late part of August? We're going into September. There's not as much rain in the forecast, but the heat is going away. Does that give? Maybe you will pause before you pull the trigger on dribbling out some of these sales on new crop.

Roach: The. I don't have much of a pause when I'm getting a sell signal. You know I don't because you're getting it. And here's the assumption that you have to make, and that is that the market knows everything, you know, and it's adjusted to what it is, you know, and it's a futures market. And so what's ahead is, is going to adjust to what the future looks like. And so just when you get the opportunities you just go ahead and make because you're not selling everything. You're just selling the bushels you need to sell.

Yeager: Okay, I don't think I've ever heard that the market knows all that. You know, that's a new one. So does the market think, I guess if Matt and I was question does the market think that we have the low in corn and beans in?

Roach: Sure looks like it. Yeah. We had bad news. Big supplies and the market refused to go any lower. And so nobody really wanted to step up and sell. And the buyers meanwhile said this price level is attractive and started to accumulate. And then once the market started to rally, now the buyers had to chase after it a little bit. And so you've got some pretty good support underneath both corn and beans, in my opinion. Now, now can we come back and make a new low. Yes we can. Why would we? Because we find out that, holy cow, the crops even bigger than we thought.

Yeager: Well, I guess Matt and Scott, both of these guys had a question and it's I didn't ask this specifically about storage, but Matt and Scott, combining your questions, guys, with large corn and bean crop expected this fall, what's the best strategy for these extra bushels that I'm unable to store on my farm?

Roach: It's hard to make that call because everybody's going to have a different cost structure out there from a standpoint of what it's going to cost them to hang on to it. And it may be that there's a livestock operation in your area that you're able to deliver to the livestock feeder, and you're able to price later and you're able to do some different things. So you have to really kind of walk your way through that. We find that it's a one on one conversation with an analyst who can help you look at all those different aspects in your particular situation. But to the degree I could, I'd hold every bushel. I wouldn't sell anything to the degree I can hang on to them now. If the cost is high, it may be better off to go ahead and move the grain and own it on paper. You can use some option strategies where you can have some limited exposure on paper there's different, different opportunities that way. But each person's got their own situation. They need to kind of walk through that with somebody who's knowledgeable.

Yeager: We also have some livestock, livestock stories and questions to work through. Scott and Wisconsin will start with him. This is one that I think we may have seen in some of the other markets, but when do we short this feeder market?

Roach: If I'm not, I'm not a good person to ask when to sell the feeder market in one of the most explosive rallies that we've had, that.

Yeager: I don't think anybody is.

Roach: John, you know, so basically, I'm going to address it from a standpoint of you're a producer with feeder cattle that you're selling, and that is you want to be careful here because everybody's got pasture this year and everybody's hanging on as long as possible. And, and so you'll want to move before it feels like it's time to move out there on the farm, because you still have grass.

Yeager: But it hasn't felt like there's a time to move at any time soon. I mean, land values going up in places with pasture, there seems to be more and more putting out there. Does that give you a sign that maybe the end is near in this feeder market?

Roach: Well, I know that if you look at the equations, you can't buy feeders and make them work against fats. You're into the very small percentage of time that you're the person who's buying those feeders. It has a very small opportunity compared to history. And so again, I would, I would I'd pay attention to the PNL on those cattle and less attention to the pasture that you have available, because I think if you wait until the pasture is down to a point where you would normally wait until get as much gain as I can, you might lose an awful lot in the value.

Yeager: Lastly, John has the planning for farmers. Do you think that's changed? You know, we talked about your career here on the show. Has planning changed with farmers over time?

Roach: You know, the interesting thing I learned a long time ago, that if it were possible, most farmers would take every bushel they produce to the grave because the price is never high enough. And the only thing I can tell you is that that has not changed. That's been the same from the very beginning that I started in this business. The market cycles up and down and farmers are never happy with the price. And so what I learned is that whenever you sell, it's always too many bushels or it's never enough bushels. It just depends on what the market does next month.

Yeager: But make a plan and?

Roach: You just have to make a plan and it has to tie to your financials, and you need to be able to make sales over a period of time, not all at once, but you have to scale over a period of time because the fundamentals change over time, and you can look at the same set of fundamentals and get completely different price levels. And so we pay attention to the cycles of the market, and we try to pick maybe in the neighborhood of 8 to 10 price peaks per year and dribble some grain out on each one of them, understanding they last for maybe 60 days or something like that in, in which case that you want to have enough stuff sold so you're not selling anything on the valley, you're just selling price peaks. And we developed a methodology, mathematic methodology, to do that. 20 plus years ago, 30 plus years ago actually. And it's worked very well. And our customers like it.

Yeager: And we like you.

Roach: Thank you Paul.

Yeager: Having you here. Good to see you, John.

Roach: Nice to see you.

Yeager: John Roach everyone, our senior market analyst and we will recap Sunday's 50th anniversary celebration, which John will be a part of. We'll talk about it in Monday's Market Insider newsletter. You can read about it. It's a free publication. Sign up at Markettomarket.org. Next week we look at the three big issues facing pork producers for the rest of 2025, and we'll have the commodity market analysis with Sue Martin. Thanks for joining us and have a great week.

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