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More risk-off trade happened today amid new and ongoing tariff woes. May corn, which had been the strongest commodity before the latest dip in prices, fell 2% in the session. May corn had been trading above short- and long-term moving averages back in January and much of Feb, but it now threatens to trade below all of them after dropping past the 20, 50, and 100 day moving averages. (200 day moving average at 4.55)
In yesterday's WASDE report, the USDA failed to raise corn and soybean exports, and it kicked the proverbial can down the road again in the March report. For soybeans, it likely waited to adjust exports upward due to not knowing yet what to do with domestic crush demand amid a lack of direction on the 45Z guidelines for biofuel production with soybean oil. It stated that it assumed the current condition regarding tariffs, and that it therefore did not consider the impact of tariffs that have not yet taken affect, and that won't take affect until April 2nd.
Steel and aluminum tariffs of 25% were enacted today. Ontario retaliated yesterday by stating that it would implement a 25% tariff on all electricity that it exports to the US. President Trump responded that he would then double the tariff to 50%, at which time Ontario backed down. Canada does not want to reduce tariffs on U.S. dairy products (U.S. request), but it instead is threatening to limit crude oil exports to the United States, while also limiting imports of U.S. ethanol. This afternoon, there was news that Canada will be imposing 25% reciprocal tariffs on $29.8 billion of American imports. The European Union, hit for the first time by higher US tariffs since Trump returned to the White House, retaliated within hours with countermeasures on US goods exports. Mexico is delaying its response to US tariffs on steel and aluminum imports as President Claudia Sheinbaum avoids retaliation while both countries negotiate to avert levies on a wide range of products and services. China said it “will take all necessary measures to safeguard its rights and interests”.
The reverberations continue from the news from a few weeks ago that the U.S. Trade Representative's office has proposed charging up to $1.5 million for Chinese-built vessels entering U.S. ports as part of its investigation into China's growing domination of the global shipbuilding, maritime and logistics sectors. The agency scheduled a March 24 public hearing on the remedies.
Ukrainian officials have agreed with their US counterparts to a 30-day ceasefire agreement, which now awaits Russian agreement. Meanwhile, both sides appear to be trying to get their last big blows in before a potential ceasefire is signed. Ukraine unloaded its largest attack ever on Moscow yesterday in a drone attack, while Russia struck a ship loading grain at Ukraine's Odessa port, killing at least four people. Ending the war would be expected to remove some of the risks of commodity movement out of the Black Sea Region, but grain and oilseed volume has not been hurt much by the war overall - with the exception of a few time windows when shipments slowed.
Estimated marketing year to date corn use for ethanol production totals 2.829 billion bushels, down 8 million bushels from the previous year's pace, but still 20 million bushels above the seasonal pace needed to hit USDA's target for the year.
Statistics Canada reported 2025 all-wheat planting intentions at 27.5 million acres, above 27.0 mln ac last year and the average 27.09 mln ac trade guess, spring wheat was seen at 19.4 mln ac, up from 18.95 mln last year but below the 19.53 mln ac trade guess. Canola plantings of 21.6 mln ac were down from 22.0 mln ac last year but above the 21.06 mln ac expectation. Corn seedings are seen up slightly YoY to 3.8 mln ac, with soybeans down slightly versus 2024 to 5.6 mln ac.
Conab produces its Brazil crop update tomorrow and most private estimates match the USDA’s optimism. Despite some weather struggles, the analysts expect a robust crop from Conab.
Funds were thought to have been all sellers.
Register online for the grower meeting here!
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