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Tommy Grisafi is the main host and content creator for Ag Bull Media.
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Wiesemeyer's Perspectives | Corn, Weather, And The Fight For Year-Round E15
A winter storm, a metals rally, and a political stall on E15 collide with a surprise export surge and a fresh farm-aid bridge, shaping a volatile but opportunity-rich setup for ag. We share why China’s buying now, how E15 still has a path, and the realistic timeline for relief.
• studio launch, premium updates, and travel plans
• storm impacts on energy, logistics, and livestock marketing
• E15 blocked for now, study council formed, next legislative vehicle likely supplemental
• Trump’s Iowa visit and ethanol plant optics as market signal
• farm aid bridge, Title I timing, and likely top-up payments
• defending farm aid within the broader subsidy landscape
• Greenland geopolitics, Canada tensions, and safe-haven flows
• China’s 12 MMT soybean buys and weekly export highs
• screwworm safeguards, cattle on feed data, market reaction
• House passes all FY2026 bills, Senate timing, shutdown odds
• Fed hold likely, potential Powell successor, market read-through
• rail brake risks in extreme cold and retail stockouts
• Klobuchar’s potential move and Senate Ag implications
• USDA portal for foreign farmland tracking
• restoring prevent plant buy-up pressure
• fertilizer tariffs’ cost impact and Canada trade links
• food price outlook, beef tightness, egg decline, sticky services
• eight reasons for cautious optimism into spring
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Thank you, Tommy G
Here we go. 321 starting at 45 seconds. Happy Friday, everyone. Tom Grassofi. Welcome back to Wees Meyer's Perspectives. Well, you see, I'm in the new studio here. We got the American flag. We got the ticker with the markets. Heck, we even have a TikTok counter. Don't forget to click like and subscribe. Join us on TikTok. We'd love to have you. Let's get through a little bit of news. We got a lot of news today. All I could say is if you got any silverware around, keep track of that stuff. Silver hit$100 today, then$101, then$102. All right. Keeping up with Mr. Weissmeyer and Us, I will be in Nashville. We'd love to see you. Come see us at booth 2312 Catalcon Nashville, February 3rd through 5th. Moving forward, as you know, we now have premium content. Thank you to our new subscribers today.$25 a month,$250 annually, putting out lots of content, text on breaking news, daily videos, morning emails, afternoon meet emails, and more. Of course, Mr. We Mike Weissmeyer is generous enough to post his stuff on the Eggbowl website. You can just search Weissmeyer's perspective. Click on the column, Mr. Jim Wiesmeyer. Well, that's that. Let's give this young man a proper introduction. And uh with that, we're gonna have a great show. There's a lot of stuff to talk about.
SPEAKER_01:We're gonna get up to 15 inches, and it could be more than that beginning Saturday morning, early Saturday morning into Sunday, and I gotta leave Tuesday to go to Columbus, Ohio for a crop insurance meeting, Joni Grimes, and then go to Fargo with Jan Vitter's crop insurance company. And it looks like I don't know, I may have to do some cancellations of flights, but we'll see. But the cold weather is gonna affect Congress too. The Senate's coming in, and they have to complete what the House did this week, completing all the remaining fiscal year 2026 spending bills. We'll get to that later, but the weather is prominent now.
SPEAKER_00:We I've been focusing on weather, and this is what I came up with, Jim. Big weather system coming this weekend. Here's what we know so far: Tennessee, Kentucky, everybody looks to be buried, possible ice. It could get really, really ugly, major storm on the east coast, and uh it's affecting the markets. Did you see what happened to natural gas this week, Mr. Weesmeyer?
SPEAKER_01:Yeah, it's uh let's just say volatile.
SPEAKER_00:Yes, volatile 75 in three days. Yeah, if you were married to that, you would say, I need a divorce. I mean, that's a look at much. But if hey, if you were on the right side, I just put up the disclaimer futures and options have risk. You talk about something moving 75 in a week. Well, we got a lot of topics to uh cover, and we got plenty of time to get there. We're under no time restraints. Now, with that, want to get to the headlines?
SPEAKER_01:Yeah, let's get to the headline. The story of the week, it to in my judgment, was the year around E-15 pushing Congress, but it ended with nothing other than they're gonna study the issue with an E-15 council, and then by February 15th, and then they have uh lawmakers, uh chairman and subchairman and all that, and then by February 25th, they're going to uh to work on a pro uh proposed legislation. But Tommy, they already had legislation, so this was a failure of the House to get it through the must-pass appropriation bills. Now let's uh why did that happen? The corn growers are more than upset about it, and I don't blame them. It's like and it's like you're in a football game, NFL, and yeah, this is everything going on it, you think you're gonna win, and somebody kicks a 60-yard field goal to win it. They had it pulled away from them. Uh, the reason is that the House Majority Leader, uh House Majority Leader Scalise, comes from Louisiana, the House Speaker Mike Johnson comes from Louisiana. You think crude oil, right? Yeah, they didn't they didn't want the year-round E-15 to muck up the spending bill. Then some people are blaming it on the Senate as well, even though it was a House bill. Now, earlier in the week, farm state lawmakers in the House went to uh the speaker, Mike Johnson, and said, We're not going to vote for this bill unless it has year-round E15. Well, that threw him for a loop because if you recall in December of 2024, that's what farm state lawmakers did to get that$10 billion farmer aid package and the around$20 billion disaster aid package. But the difference between then and now is that then in 2024, they didn't compromise. They got what they wanted. This time, the same farm state lawmakers, a couple from Iowa, by the way, who will have to be challenged on why they did what they did, they gave in, in my judgment, and said, okay, we'll accept a study of the situation and a proposal legislation. Well, I've never the emails I've received on this one from farmers are more than up, they're more than upset. Now, there's uh uh it's not dead yet. A lot of people think, oh, well, it's dead for sure now. No, no, no. The next legislative vehicle for this is a coming supplemental spending bill that we're gonna get for sure in February, March, or April. You know, you know, pick your time slot because Congress is hard to define on timelines. But that's where we're gonna get the farm aid at least proposed, and that's where it could come in to the year-round E15. But there's another appendage to this bill, Tommy, is our second item. President Trump. He's going Tuesday to Clive, Iowa. Now, and he's also apparently going to visit an ethanol plant. Now, we're gonna see if President Trump gets specific regarding year-round E-15, because some people have told me and others that if the White House had pressed the House Republicans to put the year-round E15 into that bill, it probably would have been included. So the White House and Republicans are gonna have to realize that this is this would be better than just farm aid because this is domestic consumption. For percentage point, you go above 10% from you know E10 to E15. That's a lot of bushels of corn consumed, and it could mean uh up to 95 cent higher corn prices. So this is very important, and we're gonna have to get domestic utilization increased in order to dig into the corn carryover. That's how important this is to the U.S. ag sector. Tuesday, we're gonna see if Trump uh usually on ethanol, he tries to please everybody, he tries to please the crude oil people who really don't like the program and the refiners, and uh and of course he's going to Iowa on his first of weekly stops throughout the country, going in between now and the November elections, because he knows even though he's not officially on the ticket, he's on the ticket because of his policies. We're gonna see. So he's gonna go across the U.S. It's interesting they picked Iowa first. So we're gonna see. Listen very carefully Tuesday, whether or not he comes out and and pushes Congress to support year round E15.
SPEAKER_00:And we have a tweet. And as candidate for president, I pledge to support our ethanol industry and fight for the American farmer like no president has ever fought before. Donald Trump, June 11th, 2019. That's right around his birthday.
SPEAKER_01:If I uh fact check your birthday, mine's June 14th is Xi Jinping's of China's June 15th is my birthday, and June 16th is President Trump.
SPEAKER_00:So all three communists, huh?
SPEAKER_01:The but he better bring his boxing gloves because he better fight for agriculture. Because this this is needed in there. It is important because this would show intent. So we're gonna see. But as far as Congress, the the farm state lawmakers have to carry through. If you're gonna threaten not to vote for a bill, don't vote for it until you get what you want. If you're gonna go that angle, but they didn't. So this council will solve nothing. Nothing. Congress does this when they when they don't want to solve a problem, they study it. And that's really what happened this week.
SPEAKER_00:I don't like that. They they spend too much money driving in circles. All right, our friend from North Dakota, Senator Hovind, a next farm bill aid bill push that will total at least 15 billion dollars.
SPEAKER_01:At least 15 billion. Five billion of that will be specialty crops and separate carve out for sugar beets and sugarcane. And he was on Fox Business News earlier this week, and we we had some of those specifics, if not all of them, in our last podcast. However, he he confirmed all of them. Now, the and he even said it'll be part of a supplemental. That's the supplemental spending bill. Now, the this this is just another uh element that's needed as the bridge. We're gonna get uh not just a bridge, we're gonna get guardrails because the$12 billion uh farmer bridge assistance program, FBA, it sounds like a lot of money, and it is, but it's not enough. Not to really ease the cash flow drain that's out in agriculture. And I know some listeners are gonna say enough already, we need it from the market. Well, let's get the market working relative to uh you know year-round E15. We need to get to October where the Title I higher reference prices kick in so we can get multi-billion dollars in payments if we don't get it from the marketplace. That's built into the Title I farmer safety net called the Farm Bill. We're going to get top-up payments for the special disaster relief program stage one in June. So that'll be a cash influencing. What I just said is this additional farm aid that's very likely to pass Congress. There's bipartisan support, Tommy, on it. Sometime February, March, and April. And USDA can get that going pretty quick because they've done it before. Let's hope they get the money out. And we're going to get the$11 billion no later than February 28th this year. What I'm saying is we've got a chunk of money coming through, the majority of which will be used by farmers to pay down existing debt. Nothing wrong with that to pay down debt. But we're going to try to get to that October time frame when we have the PLC and ARC payments that will come out if the market doesn't give it to us sometime this long growing season.
SPEAKER_00:Yeah. So do we call more Trump bucks on the way?
SPEAKER_01:I would say a pretty good odds. And again, uh, I know again, I want to repeat the listeners out there, this is a chunk of change out there. And they're saying, you know, we'll will agriculture lose the support with each passing big mega bill for for assistance. Well, if it could continues, if it's this time next year or October, and we need another uh financial aid uh package, uh then I would I would listen to some of those naysayers of this farm aid. But if we were to have what's in Title I now, that we have to wait for October, had we had that the year before, there's it's estimated that we're gonna get about 12 to 13 billion dollars of ARC and PLC payments this October. Wow. Look what if we would have had that in place last October. We didn't. And interestingly, that equates to the$12 billion FBA program. So in this case, rather than direct payments to farmers, you would have gotten it through a farm bill process. So that's why we need to get there, Tommy. We need to get to those higher levels. So I think it'll stabilize once we get, you know, sometime this fall.
SPEAKER_00:There we go. Next headline perspective on farm aid and what other people are.
SPEAKER_01:I'm telling you, I get so many emails on from people outside of agriculture. Okay. Like saying, well, why don't my group get it? Well, number one, they should have better lobbyists, I guess. But the other one is this tension about farm aid is not new. Farm subsidy programs have been part of U.S. policy since the New Deal. They're designed to stabilize prices and manage ag policy. It's called food security, by the way. But what I tell people outside of agriculture, what about your mortgage deduction? You don't think that's costly? Look at the child tax credit, earn income tax credit, employee-sponsored health insurance exclusion. You think that's coming out of an algebraic equation out of thin air? Lower rates on long-term capital gains and dividends. Yeah, those are taxes rather than direct payments, but it's still a gimme. In contrast, even a one-time$12 billion farm aid package that we have with the FBA is a fraction of the overall tax subsidy landscape, Tommy, and farm subsidies historically have made up a modest share of total farm income. Federal subsidy payments for agriculture in 2024 accounted for less than 6% of total farm earnings. So again, I tell those non-aggies out there, I hear you, but this is called food security. You get you get food production security one way or the other at the supermarket with prices or a combination of food prices and income transfers when prices are low for two to three consecutive years that we've been in. But again, don't forget the many tax advantages that non-aggies have, mortgage, retirement savings breaks, and and and other aspects. In other words, I wanted to clear the air there. That's why I wrote a report that's on on your site for for for people to look at and for me to send out to people when I get their rather negative emails as far as why don't they get this payment? Well, they are.
SPEAKER_00:And you know, that's what they do.
SPEAKER_01:Because this helps the overall communities at rural countryside as the money turns over six, seven, eight, ten times if you get money out in the community. So we've got to go back to uh I don't think they they they teach that in schools anymore of how how a dollar spent in a local area helps the local community, helps the education uh levels, uh, you know, things like that, gives them you know money, tax receipts, etc. We just need to go back to school on that one, Tommy.
SPEAKER_00:Yeah, that that makes a lot of sense. That makes a lot of sense. All right, we got uh that's far made. Let's talk uh Trump Greenland. What a week, huh?
SPEAKER_01:Our president he shoots for the moon, and I, you know, that's one of things that a lot of people like about him. He just he just no matter he maximizes his goals when he probably only wants to go one mile up, okay. He eventually gets to that one mile up. And we saw that this we well, the last few weeks with Greenland, where he went through a whole series of we're gonna we may do this, we may do that, we we may buy it, we may do this. And it got our European allies more than a kerfuffle to use an older term with them. And finally, and the marketplace got into the marketplace because uh yeah, it got. I mean, and why I don't I'm not saying that's the only reason why he backed off, and he did back off, but I think he got more realistic. The U.S. is going to get what they want anyway, that it and what they want is a significant increase of uh defense for Greenland to ward off any possible encroachment by China uh or Russia. And this could increase this could mean increased NATO exposure within Greenland, etc. And we need our dome, the golden dome that Trump wants to build to protect us, a huge investment. And they need Greenland because that's a strategic spot for this coming Golden Dome. So it has mirrored once again, it's how Trump does things that you got to go through this roller coaster. Can we show the roller coaster graphic? Do we have that?
SPEAKER_00:Yeah, I got that.
SPEAKER_01:This is the best, this is what I use in my speeches. This explains Trump's policy, and we've been through it almost every week now. It's like we go up and down, and it's up and down. And look at the very end, look at the off-ramp. Now, I had one participant at the meeting came up to me afterwards and said, Jim, I love the graphic to explain the volatility of Trump's uh policy, but you need more off-ramps to because Trump goes different ways then as well. And that's probably right. Bottom line is Trump gets most of what he wants anyway, but getting there, you have to go through emotion and you have to, and he brings in our allies involved, and you saw it in spades this week. Now, we had a little bit of that last week where we had the uh taco, Trump always chickens out. Now that's that that might be too severe on the Greenland thing. He didn't really chicken out, he just backed off to a degree to get what he wanted anyway. And so this just shows in Iran now. He after first saying, Okay, we're not gonna go back into Iran, then he came out yesterday and said, Well, they're gonna put an armada was his term, off uh off the coast of uh uh Iran, uh, just just in case that we need to. So this is all over again with with Iran. So that's just trying. Up you're not going to change him. So we're going to see significant volatility when it comes to Trump 2.0.
SPEAKER_00:Yeah, it's it's it's interesting here. All right. Well, that was Greenland. That sure moved the market. Some people say that's what moved gold and silver and metals up and safe haven.
SPEAKER_01:Safe haven. And this is another appendage because Canada's corny was at Davil, and he just blistered. He didn't he didn't mention the United States by name, but that's who we meant. And increasingly so, they're closing up to China. They had a Canada-China agreement recently. We discussed it, I think the last podcast, in which Canada's going to allow in more Chinese uh electric vehicles at a reduced tariff rate and uh uh up to a limit, and they're they're gonna take some canola uh meal, and that's gonna affect that's affecting the uh meal market, etc. But commerce secretary Lutnick this week said, you know, if Canada keeps on getting closer and closer to China, they have to realize that this could affect the coming talks uh that we have on the US-Mexico-Canada agreement, USMCA.
SPEAKER_02:Oh, okay.
SPEAKER_01:So Canada's being told by our commerce secretary, hey, you do what you want. However, there could be consequences on that. Yeah, that's the USMCA, which is going to be uh reformed, altered, etc. Uh July of this year. I think it's going to continue. We're going to go through that roller coaster ride that we talked about uh between now and then, but we still have a North American market. But Trump just fires back when he's challenged and he just told Corney, Canada gets a lot more from the U.S. than we get from them. Now, in the case of agriculture, with their potash, that could be a whole nother story. Bottom line is we're into this period in which we have a different a major difference of opinion between the leaders of Canada and the leaders of the United States. And that's not really good for uh trade, but it is what it is.
SPEAKER_00:Yeah, it's uh it sure is a interesting. I I'll have a picture here to bring up here in a second. I just want to pull something up to the show real quick, all right, Jim. Yeah, I want to share uh a screen here. Hold on one second. Share screen. Let me folks, this is why it's so important to this is what I'm trying to talk about. Okay. Sorry about that. Took me a little bit. Well, thank you. Thank you, Mr. Weesmeyer, for the compliment. All right, here's what we're dealing with. Here's the shit show. You got United States and Alaska. And it if you're like, why is Trump going after Greenland? Most of you couldn't point where Greenland was on the map. But when you look at missiles being shot towards America, they got to kind of come over Greenland, right, Jim? Absolutely.
SPEAKER_01:That that and it's a major area that you have to protect. It's the first line of sight. So it's it's it's paramount importance in defense.
SPEAKER_00:Yeah, look at Alaska stopping us from Russia, anyone coming that way. We even have Hawaii over there if we need it, Greenland, United States here. We're yeah, we and that I don't think that's why Trump doesn't really care what Canada says.
SPEAKER_01:No, because he and he doesn't, because he knows that in order to get that Golden Dome and to ward off China and Russia, you have to have more control because Denmark can't. They don't have the defense. So I but but they're a sovereign country and they got their their feelings hurt on that one. And it's very easy to get your feelings hurt with Trump.
SPEAKER_00:Okay, to be most of the yeah, call the police and tell most. I'd like to report a crime. Most of all what was hurt was are you hurt?
SPEAKER_01:Yeah, most of all what was hurt is my feelings, and that's what here's the thing geopolitically, and we've got the graphic on the chessboard. This is what's going on in the world right now. It's the new world order, actually, a retro to the new world order before it's being divided into three spheres: the western hemisphere. This is why Trump went into Venezuela to get China out of there in a major way, and the Monroe Doctrine uh for the Western Hemisphere, including Panama, etc. Then you have Xi Jinping controlling Southeast Asia. There's your strategies all the way around, and Putin and Russia wants to control Eastern Europe, and all three leaders are going to do some uh power plays, uh, like Putin did with Ukraine, uh Xi Jinping did with uh Hong Kong initially, and they're doing it in the South China Sea, and we did with uh you know Venezuela. It's called spheres of influence. Now, you don't want it to happen every day, every week, every month. But when you look at history, this is a tone of imperialism that it happens, and and that's the way it is, and that's the imperialist tone of the Trump administration, and we've seen the imperialism move of Putin and Xi Jinping. So that's the way the world is now, and countries I think Europe understands that more than Canada does. I I personally think Carney is a bit naive for whatever reason. But Canada is gonna have to realize that this is more just about US and Canada relations, this is just real-time stuff that uh when you're talking about three stratospheres of the world. So that's where we're at.
SPEAKER_00:Well, let's get to these soybeans at China's bot.
SPEAKER_01:They're they reached 12 million metric tons. And you recall the US officials said that uh by the end of February, we went through several hurdles on what the timeline was, but they said China would purchase it 12 million tons of U.S. beans by the end of February. They've done it already. Now, again, I I I will I want to point out fingers because uh analysis of the past, more than a few ag industry analysts discounted, laughed at this commitment when it was first announced. Number one, they didn't think there was even an agreement between the two countries. Uh, that was wrong. Two, they didn't think that uh China would buy 12 million metric tons because Brazilian soybeans were a dollar dollar twenty a bushel cheaper, but they didn't understand what we just went through geopolitics. This was a geopolitical argument. So you have to you can't use logic all the time. You can't be too reasonable. Now uh Trump and Bessent, Treasury Secretary, uh Scott Bessent told uh China this week uh we'd like for you to keep buying and to make sure you fulfill the next step in this agreement 25 million metric tons, Tommy, for the 26 uh uh marketing year, 2627. Now there's going to be a lapse here, but when you look at the uh export sales report that came out this week, we saw now this this is a good aspect, four million metric tons of weekly corn sales for the weekend of January 15th. You want good news, Tommy? This will be part of our good news at the end of the program. Okay, that's a chunk of change. And uh almost 2.5 million tons of beans. This is just for the weekend of January 15th, 618,000 tons of wheat. This is a biggie, 527,000 tons of sorghum or milo. That's big. That means China, by the way. 412,000 tons of meal, 10,500, 10.5k of bean oil. We had uh big amounts of cotton, etc. What's the bottom line? They were the marketing year highs for corn, sorghum, upland cotton, and soybeans. Soy oil was down from the prior week. I bring this in because demand is really starting to pick up for US price for U.S. commodities. When the price is low enough, we sell more. So big D demand is starting to come into play, and that's a good thing.
SPEAKER_00:And also, Jim, give you a little color. We we're about oh, we've recovered over a third of the losses from when we had that crop report. The for corn on corn, yeah, yeah. Beans are trending.
SPEAKER_01:So like beans, I think we made it up, didn't we?
SPEAKER_00:We're we're we're still we we have some more room to go, but we broke from the highs that day, we were at 450 March corn, we went down to 420, we hit 430, we're one third the way back, but beans are higher, way higher than when that report came out. Wheat's higher, you know, things are getting better. Give it time, give the market time to sell those exports, as you had noted. And we're we have really high quality corn on sale. And I had some comments on a show. We'll talk about it later at the end, but we got a lot more topics to cover.
SPEAKER_01:But but you want to see this pick up and and go into the fourth gear Tuesday. Again, we'll connect dots here. Trump in Clive, Iowa. You're gonna see a a bullish reaction if he mentions support for year LD15. I'll guarantee you a bullish day if he says that.
SPEAKER_00:Well, we might have already had it today, Jim. I gotta jump in here. Corn was up seven today. Wow, I got it going right behind me. There it goes. Corn up 6.75. Do you see that ticker? You know what we're gonna put up there next week? Jim Weesmeyer's the best. Just ask him. I love you. All right, let's get back to this show. Sure. Let's see here. All right, I gotta look through my bifocals here. It's a bitch getting older. Screw worm.
SPEAKER_01:Not too much of an update. We have a new portal at USDA, which is always good that they're continuing to further challenge and and and uh and put more research steps involved in there. We're getting that, we're about to open that new uh fly uh uh institution or whatever they're gonna call it in in the U.S. So that's a good thing. But I will continue to repeat on this whenever we do get the border opened between the U.S. and Mexico border, once we start some cattle coming in from Mexico into the United States, it's not gonna happen in one day. There's gonna be a series of of cattle tests, three, if not four, in which they have to be negative uh for screwworm in each test. And if not, they're gonna not they're not gonna be able to come in to the United States. So, what I just told you is that you're not gonna see a flood of Mexican cattle coming in short term, even when we open the border. And and that's reasonable. I I think it makes scientific evidence, it makes good market sense and good trade sense because you don't want to go too far too fast.
SPEAKER_00:And as we talk about cattle, let's just bring it up real quick. We did have cattle on feed today. These are the numbers looking at on feed, average guest 96.8, it was 96.8 placements, average 93.1, 94.6, that's interesting, and then marketing's 101.7, 101.8. So we'll see how that placement's number.
SPEAKER_01:A little bearish is what the market is saying, but we've been through little bearish in cattle for a while.
SPEAKER_00:And and to put some spin on it, we traded down today on cattle pretty good and then rallied all the way to the highs. We had a big turnaround. So if we opened a little lower on Monday, it wouldn't surprise me, but you got to understand we're opening lower from a higher close, and that's always a good thing. Yes. All right, next subject. We did uh screw worm, right? Yep. Let's get back to politics.
SPEAKER_01:Now, here's one where the house, even though it didn't have, I didn't think it was gonna have the farm aid package, this new farm aid package that Holvin talked about. That wasn't gonna be in there to begin with, but some ag reporters thought so. They were just wrong. Two, is that the significance of this is the house now has passed all 12 appropriation bills for fiscal year 2026 that started October 1. They actually did their job, Tommy. And I say in my speeches, the only reason you have a shutdown of a government is when lawmakers don't do what they're supposed to. So the House completed theirs. Now the Senate has to come in next week, and they won't get it done at the beginning of the week. I'll tell I guarantee you. This town falls apart with one inch of snow, let alone 13, 14, 15 inches of snow. But by the end of the week, it looks to me like the Senate will go along. There's always surprises, potential surprises, but it's a good thing. We're now we can get fiscal year 2026. We have stability, at least on the spending side of what the government and 12 of these bills can do. Even Homeland Security, we thought there were a number of reports who thought the Democrats would would shut down the government to get it ice. Well, you had seven Democrats vote with Republicans on the Homeland Security funding bill. So that's out of the way. Bottom line, high odds, you will not have a shutdown of the government when the timeline ends, uh, January 31st.
SPEAKER_00:Oh, very good. Very good. We're talking Jay Powell again.
SPEAKER_01:We're talking Jay Powell. Coming up January 28th, Federal Open Market Committee. Very high odds there won't be any change. That's well built in, that's baked into the financial markets. But another one update on the Fed is Trump said this week that he would uh likely announce his nominee to replace uh Jerome J. Powell when his term ends as chief of the Fed uh May May this year. And it but it looks like it won't be Kevin Hassett of the National Economic Council. Trump wants to keep him at NEC because he's a good communicator.
SPEAKER_00:Yeah, he's saying I like I like Kevin right where he is. Yeah, he's a good communicator. It's a hell of a compliment, Jim.
SPEAKER_01:It is, and and Trump likes communicators, and he's very good. The the go to the betting sites, and but the they they have Kevin Walsh as the uh likely uh announcement, and he will be well respected by the bond traders, and there's a couple of other people, and we're not gonna go into the complex thing, but the concept is number one, uh, we could get an announcement. Number two, watch the bond market when we do get the announcement because they'll give a report card right away on Trump's pick.
SPEAKER_00:Very good. Can you add a little color about Lisa Cook in the Supreme Court? Another someone on the Fed board?
SPEAKER_01:The Supreme Court in in hearings uh this week uh gave at least the signal that uh Trump won't be able to fire her right away. I think uh they want her legal case to run its course before allowing Trump to fire her. So that's where we're at on that one. And we also, in the Supreme Court this week, we had a uh no opinion again on the constitutionality of Trump's trade policy, and the Supreme Court takes off about a month, so we're not gonna get the ruling on the tariffs on the hundreds of billions of dollars of uh trade tariffs until probably a month from now.
SPEAKER_00:Okay, that'll be interesting, yeah. All right, Federal Reserve. We got freezing rivers.
SPEAKER_01:Yeah, and that this has been talked about all week. It's not like we don't have freezing rivers every year. I find that's interesting. Now I know it's gonna be it's more than frigid cold out there, okay?
SPEAKER_00:But big shout out for Lindsay for getting you said get a picture of a freezing river. Our girl Lindsay steps up.
SPEAKER_01:Yeah, my notes here that I'm looking. We don't know if this freeze is worse than historic and history or not. Maybe it has gone further south because you're gonna get some bad weather, far uh, really bad weather in the south. Of course, because I got a map of that.
SPEAKER_00:Here's the bad weather map.
SPEAKER_01:I'm going to Baton Rouge, you know, and I'm going to Florida coming up here for Farm Credit Council and then Baton Rouge for the sugarcane growers who I love. And I always say I'll learn that uh while I can drink with the Cajun, I can't keep drinking with the Cajun. I'll have to learn that all over again. But then another analyst told me there's probably more of an issue on trains from this bitter cold. Explain that. Well, the the brakes don't like cold weather on trains, and especially when you get into Canada, when you go into the mountains, that they you can have some problems. Now, there's a cattle and and hog you know angle on this too, as you well know, Tommy. When you have you don't have the uh marketings involved, you can sometimes you get backed up in marketings uh depending on the duration of uh of the frigid coals. And of course, regretfully, you have deaths on that. And USDA even put out a big press release uh helping farmers to say, hey, these are some of the things you can do to get by what appears to be a major, major weather pattern across the entire U.S.
SPEAKER_00:One real quick thing about the cattle market here. Because the whole United States is being affected by these storms, not just cattle, but chicken, pork, cattle, the amount of pictures of empty grocery stores, like my one daughter's at University of Kentucky in Lexington, my other daughter's in Nashville, they said the shelves are bare. You don't get to pick which brand of bread you want, just go grab bread. And uh, so we've had a big run on the uh on the freezer case and the uh fresh meat case here. And so we're sold a lot this week, but then people stock up and they may not need a lot in the next few weeks. Just something to think about, Jim.
SPEAKER_01:True, that is true. Plus, I had to get my cat food.
SPEAKER_00:Well, I can't let you say all the smart stuff, and I never changed things smart, you know. Let's go back to Minnesota.
SPEAKER_01:Senator Amy Klovachar did the initial work, that she's paperwork to run for Minnesota governor. If she runs, she's gonna win it. Okay, that's an easy prediction. She's uh well liked. Uh and uh if she does run and win, which she will, it's Minnesota. The next ranking person on the Democrats on the Senate Act Committee is Corey Booker from New Jersey. Different lawmaker than uh than Amy Klobuchar. Amy will work across the aisle more often than not. I think she's a fair person. She knows production agriculture. Corey Booker, just do a Google on Corey Booker. He's uh doesn't quite understand production agriculture. He's a foodite. So we'll be an interesting situation if he's the Senate Ag Committee Chair. Either ranking or chairman, depending on how the November elections go. So I would watch that race. Now, these are just initial paperwork that she probably had to do just to keep her options open. There's some people who are telling her not to run for governor. Every farmer that I talked with recently in in Minnesota said that they hoped she didn't. They like her up there on the Senate AG Committee, and they think that the morass called Minnesota in the in the situation that you've seen on TV and radio with the fraud going on, that this could bog her down as governor. But she used to be a prosecutor, so she could she's well adept at at taking that on. It looks like clearly fraud. I'll tell you, this is just a funny one, but it's true. I did a webcast yesterday for Louisiana State University. And the who I think it's through with any university. If you give a speech for a university, you have to fill out so much paperwork to be paid. Why? It's just well, it's just that that's the checks and balances. You tell me Minnesota can't, they ought to they ought to contract with Louisiana State University and look at their system. In order to get one cent out of that, they have to do this, this, this, and this. And I thought to myself, you know, I got to remember that that they've got a good checks and balances system. And I've seen the same thing with other universities. Sometimes I don't want to say I might even speak for free because I don't want to go through all the hoops that you have to to be paid by a university. That's a little sidetrack, but it's true though.
SPEAKER_00:Oh, that's that's interesting. You always have such interesting spin. What's this mean? USDA launches online portal to track foreign purchases of U.S. farm.
SPEAKER_01:That that, yeah, this is an additional thing to track the foreign purchases of U.S. farmland. And we're really talking China primarily here. We need a better system, and I'll give it this has come from Congress and USDA. It'll take a while, but we need a better system to track all the uh all the purchases from outside this great country of uh farmland. On a percentage basis, it's not that great, but it's where they're purchasing it. You know, China has a habit of purchasing farmland around airports, thank uh uh Fargo and other areas. So I I think this is a good thing. I I I I think that uh it's needed. So let's just hope that they actually implement this portal to have a true accounting of who's purchasing it, where, and what for.
SPEAKER_00:Yeah, I skipped you. I I went too fast. Senate, we got to go back one. Senators urge USA to restore buy-up, prevent plant.
SPEAKER_01:This is a bipartisan letter to USDA and different officials within USDA, FSA, et cetera, to saying, you know, they pulled the rug out below farmers earlier this year in a ruling that they put in the Federal Register that took back the prevent plant buy-up. Now, you still have prevent plant, you just don't have that additional, I think it's 5% buyup. And they made it clear, Congress did, bipartisan group of senators to say, we want you to rescind that decision that you announced, and we also want you to eliminate uh that rule from 2027 onwards. And I think the pressure is mounting. And if they don't do it, you'll see it as part of this supplemental spending bill language where they'll direct USDA to do it. Now, USDA says that it wasn't needed because you have ag disaster aid and it was and it was really top-heavy for in the North Dakota area. There's other states that use prevent plants. So I just think yet I learned going back to Earl Butts' days with the Earl Butts with the Reagan administration, Nixon, Nixon administration. He taught me if you're gonna have a farm program, make it as farmer friendly as you possibly can. Make it work.
SPEAKER_00:Well, that makes sense.
SPEAKER_01:They're not making prevent plant work. Why would you do that, especially at a time when you're into this period in which you have bridge assistance or the need for bridge assistance program with guardrails to get to the other side, meaning the fall of this year? So I think it's gonna be changed.
SPEAKER_00:Okay. What about uh fertilizer? That's been a really tough topic everywhere. I go speak, everywhere you go speak. People want to ask you, Jim, what's the deal with fertilizer?
SPEAKER_01:Well, I think fertilizer is we're gonna see not the dramatic increase that we've seen, but Texas AM. And on your site, Tommy, we give a link to this report. It's called increased cost of phosphate fertilizer in the U.S. due to the countervailing duty, we call them CVDs, on imports from Morocco. How much did it cost? You know, it cost U.S. farmers almost seven billion dollars in additional cost, just Morocco tariffs. And it raised DAP prices nearly 30 percent. You want the one of the biggest reasons for the uh price run up? It's our countervailing duties. Now I know it helps protect certain companies. I totally understand that. But when I first came to Washington in the mid-70s, we used to have more cost-benefit analysis of uh rules and regulations. Uh, if they did a cost-benefit analysis, look at that. That uh this report would have said, you know, this is really gonna hurt the average farmer out there. And we had other studies out this week, North Dakota, that said uh these some of these tariffs are impacting the fertilizer costs. So these are some of the not so hidden reasons why we've had the fertile uh fertilizer price run up. And this is phosphates. Now, with uh potash, it's a Canadian, it's that's a North American, most of it comes from North America, but that's a Canadian issue. So we have to have better U.S. trade relations with Canada. We connect the dots. We don't have good trade relations with Canada right now. Bottom line, Tommy, we have to get into looking at for the regulatory reasons why fertilizer prices have added substantial cost to U.S. farmers under multiple growing seasons.
SPEAKER_00:Let's hit food prices.
SPEAKER_01:Food prices came out today, and it showed trying to see my notes here. We had, I can't find them now.
SPEAKER_00:I got a nice picture of what it looks like. It takes more chips to buy more food.
SPEAKER_01:Yeah, we we hold on. I think I've got it here. There we go, there we go. I've got my my big monitor. I'm telling USDA revised the price outlook, they slowed grocery inflation, in other words, decreased it, but they lifted restaurant prices. So that tells you, and and you can see it in some of the if you go out to eat, you've seen the restaurant prices. Now, here's some other things. They the the price of egg, egg prices. Remember when they were up so much when Trump first came in to 2.0? They're projected now to fall sharply, down 20 a little over 22 percent from 2025. Egg production is rebounding. Give it a chance, and broilers can kick high gear since mid-2025. And now USD also expects prices for other foods, that's a broad character category, with a 12% of 12.6 percent weight in the food price index to rise 3.1 percent. Now, prices for again for eggs, dairy products, and pork are expected to decline this calendar year. Beef and veal prices are forecast to surge 9.4 percent. Wow. That's the cattle inventories are are are still down, and consumer demand remains uh resilient. So that's really what came out. They they projected overall food prices to rise 3% this calendar year compared to 2.5 percent in 2025. That means food prices are still gonna be sticky once it comes to inflation. Uh you couple that with, even though we have gas prices, I think they averaged two dollars and eighty-five cents this week. That uh, but you've got some areas that are that are close to being under two dollars. I know in Oklahoma uh they they were under two dollars, but it's electricity prices, Tommy, that are up so much because of our data centers. So, how does this let's connect dots again? The Fed watches the inflationary rate, and they don't want to decrease interest rates until they get a better, firmer grip that inflation's gonna meet their target of two percent. And it looks like we're about two and a half to two point six percent right now, trending down lower, but we need uh we need a little more disinflation, not just in food, but but in the other cost for Americans.
SPEAKER_00:We got a little breaking news, Jim. A little breaking news, and nothing that we were expecting, but uh we got we gotta do it. You're not gonna believe this. Everyone's talking about this hundred dollar gold. Oh no, hundred dollar gold. That is so lunchtime news. That's that's old news, hundred dollar gold. No, what we have right here, that's hundred dollar gold. That was really cool to talk about at lunchtime. Yeah, what we have here, Mr. Weesmeyer now is a hundred and three dollar, or did I say gold? You did silver. Well, I was excited.$103 per ounce silver. Silver just hit$103. But let's go back to gold.
SPEAKER_01:Well, there's other reasons there for both gold and silver. Not the well, it could be maybe the primary reason. China is not polling out, that would be too strong, but reducing their per uh their bond purchases of you know, U.S. treasuries, and where do they put their money?
SPEAKER_00:US, yeah.
SPEAKER_01:Central banks around the world have increased their purchases of uh of gold, and of course, silver uh almost every part in a car, right, has silver in it.
SPEAKER_00:Yeah, and all these new uh tech centers and everything else, and there's a new battery coming out that's super duper great battery. And just a few months ago, silver was 35. They said we we could make this battery, it's so powerful. The price of the input for the silver has tripled. Wow. There's gonna be fallout from this, Jim. Industries can't handle this. Let's go do a little just to educate people. Who has the most silver? Mexico. Mexico in a really good spot here, yeah, with silver and then China, etc. But uh US not so much silver. Interesting uh note, gold, which I was saying the word gold. Gold is just a few dollars away from hitting five thousand dollars per ounce, something we could have only uh dreamed of a year or two ago. Let's head to the uh mailbox. This young man uh emailed you Shane Goblin.
SPEAKER_01:Shane Goblin from Wisconsin. In fact, he was at the Monotymy Wisconsin meeting I was at uh and met me at the door to thank me for the podcast that we have, Tommy. And he was very, very appreciative. And he sent me, he liked our last segment, and I've had a number of producers say they like uh when we end on a positive note. Well, he's a corn producer, and he wrote me an email, and he was forlorn this morning. He said, Look, I I want to be optimistic, but uh we're having a corn soybean uh meeting in Wisconsin last week. I've spoken at it over the years, and what do I tell them? What do I tell them? So after I got that, I went through just real quick some of the positive things at one.
SPEAKER_00:We got them listed right here. Yeah, okay. One through five. Yep.
SPEAKER_01:You've got fertilizer prices while still higher expected to be stable to lower ahead. The RFS mandates for renewable fuel standard mandates for 26 and 27, probably announced sometime in February, if not early March, should be corn and soy being demand positives. We need that announcement. That's your domestic utilization. The 45Z program and sustainable aviation fuel. Once we get the Treasury Department to ever release the tax incentive details, that's gonna be good to very good for soybean consumption, soybean oil. And the more soybean, we're gonna crush for oil, and that'll mean more meal. So that's one to look forward to. We mentioned, I'll add a bonus here, we mentioned the the demand side with the export sales recently. Congress is gonna provide at least$15 billion in additional farm aid to go with that$12 billion farmer bridge program. That'll help the uh cash flow until the Title I provisions for ARC and PLC kick in in October. We're gonna get the top-up payments for those farmers who got the special disaster relief program stage one. They'll probably happen in June. It could be a pretty good percentage top-up payment. We have crop insurance changes that we had relative to the one big beautiful uh uh you know uh bill, and one big beautiful bill. And a number of farmers have told me, I can't say all states are going to be like that, but their insurance check that they're writing out for this year is lower than it was last year. Okay, that's not a negative. Uh another ones that we're on five now. There should be an early, there's usually always a spring rally in corn and soybeans as planted acre competition picks up. And that's going to be the case, especially we're coming off record exports for corn. So that market's gonna want to bid those acres. They may not go down as much as some people might think because of the demand for corn is clearly there. If China lives up to its purchase commitments, they already have, as we said before, on the 12 million tons. What about the next commitment? It's 25 million metric tons. Yes, it's 2627, but it'll be continued demand for U.S. soybeans. Seven, the pressures are going to continue to build on Congress to approve year-round E15. And I know corn farmers, the corn growers, uh, NCGA, biofuel company, they're really down. They were down yesterday, they're down today, but it's not dead yet. And which I I'll say it again. Listen to see whether our Trump gives this any oxygen. And if it does, then you increase the percentage that Congress will codify it. And the last one, oh, eight, is the U.S. economy. I'm more bullish on the U.S. economy for the year ahead because uh I think people are too somber on uh the lack of understanding of what that tax reduction and business incentives did in the one big beautiful bill, OB3, as we call it. And I think as the year goes on, you're gonna see earnings from companies really surprised to the upside. We're gonna see uh companies take uh they'll have more stability and policy, they're gonna go to know more. So I think that, and whenever you have the U.S. economy going stronger than people think, that helps the world on that, and that'll be good for potential demand. And the last run, interest rates, even though the Fed's gonna hold steady, very likely January 28th at the Federal Open Market Committee. Uh, most people think that uh they'll go down another one or two times. So this time next year we're gonna have lower interest rates, so financing cost will go lower. So that's a pretty good dose of pretty positive news, isn't it?
SPEAKER_00:That's a really good dose of positive news. I like how you did that, and you you know you really took some time to answer his question, folks. If you ever want to get a hold of us, go ahead to email Jim. Email myself. But uh, Jim, what's your travels look like as best you can? Travel.
SPEAKER_01:Well, if I can get away Tuesday, I'm on my way to Columbus, and I go to maybe an hour drive. That'll be fun. Into a crop insurance meeting, Joni Grimes. Then I fly from Columbus to Fargo, Jan Fitter's a crop insurance company. Fargo in January builds character. I always say that it builds character. Then I go home to St. Louis area for my sister's 80th birthday. I have to go a big family, and it'll be a family reunion. Then I go from St. This is all together. Then I go from St. Louis down to Orlando, Florida. I'll need that for the farm credit console. My good friend Chrissy Seifert, who is the CEO there. I was on a Zoom call with her this morning. What a, what a what a good CEO for that group. Then I go from there, I go to Baton Rouge, Louisiana for the sugarcane league meeting. And as I said, that the sugarcane people are so nice. So, and they need some aid that we've been talking about, both the sugar beets and sugarcane. Then from there, I go to Palm Springs, California. And let me just tell you, going from Palms, going from uh Baton Rouge to Palm Springs is not easy, but I'm gonna try to make the curb meeting, a crop insurance meeting there that I've done for at least 10 years, I guess. So hopefully that's my schedule. I mean, a lot of stops. A lot of stops in the days ahead.
SPEAKER_00:All right, Mr. Wiesmeyer. Hopefully we can get together next week. As always, you want to get a hold of Jim, just uh email him or uh drop a comment down below. I'll see you next week, Jim. See ya.
