Wiesemeyer's Perspectives | Odesa Pounded Trouble in The Black Sea

We connect the week’s biggest market moves to their real drivers, from China's soybean demand and the upcoming USDA survey-based crop report to wheat supply risk tied to the Black Sea. We also map how record copper and surging metals, Farm Bill politics, and Iran-driven energy uncertainty feed straight into diesel costs and farm profitability. 

• weekly performance across grains, oilseeds, cotton, livestock and the key charts driving sentiment 
• why the August 12 USDA crop production report is a volatility trigger and how acreage revisions can beat yield tweaks 
• Black Sea port strikes, Turkey restrictions and war risk insurance turning wheat into a logistics story 
• copper at record highs from AI and data center demand, plus gold and silver reacting to jobs data and Fed expectations 
• what the weak jobs report signals for the dollar, rates and commodity tailwinds 
• Senate Farm Bill 2.0 surviving committee defeat, the McConnell attendance wildcard and the SNAP sticking point 
• MCOOL passing the Senate committee and why the final language may change to manage trade blowback 
• Iran update, Strait of Hormuz leverage and why crude and diesel react to perceived military posture 
• “DieselGeddon” fundamentals: low distillate stocks, near-max refinery runs, record exports and harvest vulnerability 
• ethanol exports rebounding with Canada as a major buyer, plus the EPA waiver risk hanging over biofuels 
• Jones Act suspension likely extended and why it matters for energy and fertilizer logistics 
• crop insurance premium payment relief, NASS data modernization and FDA’s ultra-processed foods definition framework 
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Transcript

SPEAKER_00 0:13

Welcome back, everybody. Tom Grossoffi, AgBull Media, Ag Bull Trading. I have the one and only Mr. Jim waiting. We have a lot of things to talk about. Some breaking news over the weekend, both on the cattle side and the Black Sea.

Anniversary And Breaking Market News

SPEAKER_00 0:24

Very important. I do think it could affect the wheat markets tonight. Keep an eye on that crude oil. Looks like President Trump may be changing his plan for Iran. All that and more in this week's Wiesmeyer's Perspectives. Before we start the show, I want to say happy anniversary to my buddy Jim. This is officially the one-year mark of doing Wiesmeyer's Perspectives. Out of the 52 weeks a year, we missed two weeks. One, because we weren't feeling good. And two, we celebrated America in a big way with the 250-year anniversary. But we're delivering good content to you every week. We'd love for you to move over to the subscription side. And whether you want to or not, you're going to have to eventually. But right now, this one's on us. Happy anniversary, everyone. Mr. Jim, you're there. Happy anniversary.

SPEAKER_01 1:47

I'm one year young. I'm one year young.

SPEAKER_00 1:50

You are one year young. I understand you did a little traveling, maybe drinking some hoppy beers in the countryside in Virginia. We could talk about that and all more. But I got a feeling this is going to be a fast show. Yeah. A serious show. Accelerate it. Yeah. Yeah, we got a lot of important stuff going on here. Let's do what we do first. Let's get in the markets, Jim.

SPEAKER_01 2:08

Yeah, look at we had a down week in soybeans. Look at down 11 and a quarter. And that's with continued, relatively

Weekly Market Scoreboard And Crop Reality

SPEAKER_01 2:17

robust China soybean purchases from the U.S. We're going to have more too, you know, you know, based on our sources. Soybean oil, though, that's a biofuel winner up 98 points. Corn is just they're waiting for this August 12th crop report. We'll get into that. Meal down. But look at wheat. Wheat has come back, even though SRW was only up, you know, you know, basically unchanged, up a half a cent. HRW up six and a half, but we'll have a little item on that because that's uh that we had some Saturday and Sunday fireworks in the Black Sea grain area. And as you said, I know it's been one-day wonders or half-day wonders in the marketplace, but it's starting to uh resonate, Tommy, with the number of uh uh articles that I've read and the number of calls I get in on that. But you know, look at the leader here, cotton, up 261 points. There are some some technical positives going on in uh in in cotton. Cattle is just uh mixed as as as we get into that market.

SPEAKER_00 3:26

We'll talk about that a little bit too, because they they're being thrown all types of different news every day and uh a little bit of crisscross signals, but we'll get to that more in the uh show. I do want to add a little color on spring wheat down 10.5 cents. Uh, it is spring wheat harvest up in the plains in Canada and everything. And even though I don't think the crop's as good as some would hope, and we do know the acres are down. Harvest is harvest, Jim. When you have harvest, there's harvest pressure. Folks take that spring wheat off, they bring it to town, they get make room for soybeans or edibles or beans or corn. But I will say to note, I was sent some pictures today from a Red River farmer right there in the middle of the Red River. Oh, these were ugly corn pictures. I didn't load them up, and I know people think I'm blowing smoke and everything else. I am telling you, just based on clients, and I have plenty of clients in the great state of North Dakota, that corn crop is not that great. The big question is, can all the other states make up for it? I don't think so, Jim, and I'll tell you why. To have a record corn crop, you need the fringe acres to hit, and I don't think the fringe acres are going to hit the year this year.

SPEAKER_01 4:31

North Dakota is no longer fringe, as far as I know. You can go into the middle of a North Dakota cornfield and you think you're in Iowa or Illinois now.

SPEAKER_00 4:40

Yeah, absolutely. Absolutely. We'll see. Hey, I I I got all types of stuff for you, but what do you think of my little light bulb behind me? Like if you say the markets are down, I'm gonna turn the red light on. If you say the markets are going up, I'll go green. But let's just play it cool, like your shirt. Let's stick with blue, brother. Oh, by the way. No change. Blue, blue. You know, I'm a little tired, Jim. I gotta tell you. I woke up early and I went and put my weight vest on. I got a 30-pound weight vest and I walked three miles and I got my heart going, but I'll tell you what. I don't know that I needed 30 extra pounds on this frame, but I did it anyway. And what a pleasure it is to do this video with you. And can you tell people real quick how how the heck a good friend of mine says he's got the saying that assholes a trick? How how did you and I become friends?

SPEAKER_01 5:29

Yin and yang, maybe uh on it. Well, Tyne Morgan was the first one to introduce us, and that was a good suggestion from our good both friends, uh, Tyne Tyne. And you were what I was looking for, and hopefully I was what you were looking for. And we're we're a team. We're we're a team now.

SPEAKER_00 5:50

We're we're bringing together, Jim, you and I, over 140 years of what not to do. Yes, that's our disclaimer.

SPEAKER_01 5:57

We know the back alleys, let me tell you that one. All right.

SPEAKER_00 6:01

Well, it's a privilege, and I could sit here and praise you forever. But oh, by the way, folks, if you missed it, Davis Michelson, he's the host of AG Squawk PM, or we call it Ag Squawk. We have Ag Squawk AM, and then just plain old Ag Squawk with Davis, Jed in the morning. But Jim and Davis sat down, tried not to go long. I think they went 55 minutes, and that was a really good show. And then we're gonna clean up on a couple things that you you couldn't get in there with Davis. But let's look at this. You you drew up this chart. This is, you know, I like pictures, I like graphs. Tell us what you're thinking here.

SPEAKER_01 6:30

Yeah, look at that. Look at Cotton, as I said, they they were the winner this past week, up 3.2 percent. Soy oil continues to be impressive, and it'll continue that way based on my calls to analysts, unless EPA gets cold feet on some of the mandate and SREs. And we could get that any day now. There another announcement coming for uh uh waivers, yeah, Tommy. Wheat is just treading right now, as you said, uh harvest time, etc. Corn, they want to wait until the August 12th report. Look at you know, soybeans down, uh spring wheat down, but you gave perspective on that. Look at hogs. Hogs was the loser this week. It just doesn't look good chart-wise, seasonal-wise, uh, etc. We had we have to use more bacon.

SPEAKER_00 7:19

I I have a couple pounds in my fridge. Let's get into the guts of the show here. You did mention the crop report, that's August 12th. That's a big deal. And let's talk about, let's get Jim's perspective of why you think August 12th could be a big deal.

SPEAKER_01 7:35

Well, traders,

Why The August 12 USDA Report Matters

SPEAKER_01 7:35

although they expect little change for corn and soybean yields from USDA's non-survey assumptions in July, this is the first survey-based estimate for corn and soybeans and a number of other crops. So that's why it's an important one. The big unknown that could be the wild card is whether or not uh NAS alters the planted and harvested acreage estimates. And there, if you're gonna have a surprise, Tommy, it'll be in this area. Uh because corn expectations 182.4 versus July 183. That's a snoozer. And soybeans 52.9. USDA's assumption in July was 53. So that that's again, no big change. But traders are also going to watch the supply and demand report, we call the WASDI, because uh of our export and carryover forecasts. So those are the two on the demand side and the stocks uh uh carryover, because USDA is going to have China prove it to them. So we're gonna see increasingly so in the months ahead, they're probably gonna be increasing the U.S. soybean export estimate as if if and if indeed China continues to uh purchase U.S. soybeans and and hopefully other commodities. Plus, on the wheat side, we're gonna have the impact of the Russia-Ukraine Black Sea uh uh infrastructure battle. And I mean tell you Saturday and Sunday, we we had big developments. It was a brutal weekend, a missile and drone barrage on Ukraine's made main grain port, Tommy. Within hours, Turkey restricted Black Sea shipping. That's the new news on that.

SPEAKER_00 9:23

What's that mean? Hold on, talk to me like I'm a third grader.

SPEAKER_01 9:26

Let's push war risk insurance past its 2023 peak. And it's gonna cut Ukraine's seaborne export capacity to a trickle. And so the market in the U.S. has been wanting to see demand proof, and we're starting to see it in Europe. They're they're increasing some of the their exports out of Europe as a result of the problems in the Black Sea grain trade area. And if it comes back to the U.S., we don't have to have much additional U.S. wheat exports to really dig into those carryovers. So we don't know that yet, but uh you know this I think will be a big development as we open markets uh Monday. Turkey's move, I think, is going to be a more durable constraint because they raised their fees about 15% on July 1, and now the their their decision to withhold

Black Sea Logistics War And Wheat

SPEAKER_01 10:23

permits for Ukraine and and et cetera, that's just elevating. And you can see, do you have the map up here? Yeah, yeah.

SPEAKER_00 10:31

Black Sea.

SPEAKER_01 10:31

Look at that. That's the squeeze on Black Sea grain. Uh again, that shows that Russian strikes have hit every major Ukrainian export port, and Ukrainian has struck the Russian side. The the Kerch uh Strait is closed, as we keep saying, Turkey is restricting transit at some of the port areas. Romania is the main remaining outlet.

SPEAKER_00 10:56

So there are on the left, yeah.

SPEAKER_01 10:59

Absolutely. There's your avenue, but it's limited of how much uh you can you can get out of there. So that's why uh before the this battle in in the infrastructure began, Ukraine's deep water ports, Tommy, were loading about seven million tons of grain a month, and now more than ninety percent of Ukraine's farm exports are moving through three ports, and the strikes have just knocked them out. So we're we're down to a trickle. We're down to a trickle.

SPEAKER_00 11:33

Tommy G and Jim W. perspective. Now we know the United States had a short wheat crop based on Kansas City. We know that regardless, well, we know for a fact that Europe had a scorcher of a summer. There's no doubt there's a production problem there in corn and any type of grain you could grow that would be affected by heat. So Europe's in trouble just by production. America had a short crop, which didn't really seem to, I mean, we we did put $1.50 on wheat and then took it all off, and then we put some back on. Where else can people get wheat in the world? Australia, that's fine. But you know, they say they grow wheat everywhere and they're harvesting wheat everywhere. When I look at wheat in the world, I see problems in a lot of the places. And then, not to mention, and you can add color to this, but Russia is really big on shipping wheat, but Russia's having a problem with diesel fuel. And then, as you had said, this back and forth, uh, Russia bombed the heck out of Ukraine, but Ukraine's been also bombing those oil facilities in Russia. I will give the analogy of this there's a lot of dry grass out there, and they just keep throwing cigarettes off the highway. And if this catches, we could see some bullish price action. Could, no guarantees, but could see a friendly wheat market this week, Jim.

SPEAKER_01 12:43

Here's the bottom line. This is now a war on logistics because of the Black Sea area, and logistics wars are won by duration. Russia can't blockade Odessa, so it's bombing it into economic irrelevance. And Ukraine is returning the favor at Russian ports, and Turkey, the only actor with legal control of the exits, has begun metering the door. So the US, as I said, it's gonna come late to the party, but I think they're gonna join the party later on. Europe gains mostly through price, and the United States eventually I think gains real business because look, Mexico, West Africa, and Southeast Asia, possibly China, with the smallest winter wheat crop in 60 years. You heard me correct. 60 years, yes. America can capture some of these uh elements, especially when when they're repairing these port areas, and it's gonna take months, not weeks. So again, the veteran traders caution to treat every Black Sea supply number as provisional and every rally as insurance against the next strike. That's that's what they're telling me. So it's not gonna go away anytime soon. Uh usually they do, Tommy. History shows this is you know, short crop, long tail, but not not now. This this is this is going on and it's getting more severe, not less severe. And now you've got port damage that's gonna take months to repair, not weeks.

SPEAKER_00 14:21

Let's change the subject a little bit, a little happier subject here. Copper hits record as gold and silver surge last week. Dr. Copper, as a commodity trader, when I see on a Friday that copper hit all-time highs and the SP

Copper Records Gold Surge And Fed Odds

SPEAKER_00 14:36

hit all-time highs, that's why guys like me call it Dr. Copper. You whipped up some good charts and statistics here. The stage is yours.

SPEAKER_01 14:43

Yeah. Well, look at copper. They they hit a record, as you said, 6703 a pound. That's the new New York record. They set Wednesday, by the way. The reason scarcity, physical shortage risk. I mean, China, we're China is going after it big time because why? It's needed for artificial intelligence, a data center power build-out, mine disruptions, low inventories, tariff-driven shifts of the metal to the United States. So scarcity, copper driving it higher. Gold is following along. You had they were up uh what 7.2, a little over 7% biggest weekly gain since January. The reason for them is monetary doubt because that weak relatively weak jobs report. Well, it was not relatively, it was a weak jobs report that we had that we lost what 23,000 jobs lost. So weak jobs data means that you it increases the odds that the federal open market committee, September 15th, 16th, will hold steady. They were they're not going to increase the interest rate. And that had been propping up the dollar before. And now you saw the dollar go down as a result of that jobs report. Other things on gold, falling treasury yields, reduced odds, again, a Fed tightening, and the uh the distrust of paper assets. So that's all helping gold here as central banks continue to buy gold. Silver, as we said, they're pricing both at once. Uh Russia's metal hedge, plus heavy industrial use and electronics, energy. So it moves more violently than gold. It was up what 10% this past week. That's a move, Tommy. Silver.

SPEAKER_00 16:33

Yeah. I did uh I reached down and I you're gonna be really proud of me here. You're gonna say, good job, Tommy. I reached down and I got a wire. This is RJ6. This is folks, older folks call it cat five, cat six. There's eight wires in here, okay? So while Jim was talking and I have these things all over, I still have my house hardwired because as anyone who knows, wired works better than wireless. But while Mr. Jim was talking, I asked AI how many pounds of copper in a data center. Uh, would you like to guess how many pounds of copper?

SPEAKER_01 17:04

I have no idea, but I bet a lot.

SPEAKER_00 17:05

I have an idea because my friend Mr. AI helped. There's typically be 15 to 30,000 pounds per U.S. data center. And Jim said that we hit a record of like 675 per pound. So take 675 times 25,000 pounds. That's a lot of money in copper. That's just one data center. And anyone who knows, if you want to get everyone riled up, start talking data centers. Everyone's got an opinion. And that's just in the U.S. And these data centers are being built all over.

SPEAKER_01 17:38

If you came out to my county, Loudoun County County, that's the number one data center capital in the United States. They're all over the place.

SPEAKER_00 17:46

How'd you know that?

SPEAKER_01 17:47

Well, you just come out here and you'll see. You'll say, What's that?

SPEAKER_00 17:50

Genius' coming out too. We're coming out and you're buying us dinner. So, oh nice dinner.

SPEAKER_01 17:57

We're probably gonna go where I went this weekend to Milliberg. Oh, my love of country. That's that's hor uh, that's uh uh horse and fox country. I saw a red fox, I saw eight years in one cornfield alone. Yeah, on the on the edge. But there's uh a girls' school ages nine to twelve that's beautiful, that the rich people send their kids at. It's called Unison, Unison, Virginia. You ought to look it up. It was a beautiful place. Anyway, I stopped off and I got good old barbecue and I got wheat beer, half a weights and I just had fun. But I'm gonna take you to the Red Fox Inn in Middleburg, Virginia.

SPEAKER_00 18:41

I I'm there, baby. I'm there. All right. Speaking of there, you did some charts here. The week in metals, because you really yeah, we went through them.

SPEAKER_01 18:49

We went through them.

SPEAKER_00 18:50

Okay. Yeah. Just look at this though, but copper up there, record, copper at the LME firm. These are internationally traded things. Uh gold, mark China down. I heard China bought a bunch more gold last month, silver. Uh, there's that plus 10%. Yes, we did cover all this. Yeah, keep an eye.

SPEAKER_01 19:08

We we went through that too, as far as the reasons why. It's got a solid base, is what is what we're we're saying right now. Now, that doesn't mean you're gonna go up every day. That's just that's not markets, you know. But it's got a fundamental tone to it, both from from the usage and of course with the monetary in the United States signaling, clearly signaling now that the Fed's probably gonna hold September 15th, 16th, unless we get some inflation numbers this coming week. We both get CPI and and uh wholesale price index. If that throws us for a loop, but right now, Tommy, it's signaling uh steady as she goes for interest rates, no increase. And that that brings us into the jobs report.

SPEAKER_00 19:52

Yes, sir. So we had a jobs report Friday. The numbers look scary. I think if you do a deep dive into the numbers, they might not be as scary based on some reasons, but we lost 23,000 jobs in America that surprised some people, and the markets had an immediate reaction. You the stock market bounced, the metals bounced, an explosion, had a big move on the dollar versus other currencies. What'd you see, Jim? Digest it for us.

SPEAKER_01 20:15

Well, at first, some people were saying, was this as a result of the world soccer thing? And the more I researched the Tommy, some but not a lot. It'll that'll be more maybe come into play in the August numbers, I was told. But the unemployment rate dropped to 4.1 percent. Kevin Hassett, the National Economic Council director, says he looks at one number right now, it's the unemployment rate. And that actually went down on it. So that maybe you never get too excited on one jobs monthly numbers, Tommy. So we'll have to see if this continues. But the bottom line, and this is why the dollar went down and the stock market went up because it lower odds that the Federal Reserve is gonna hike rakes after September 16th, FOMC decision date.

SPEAKER_00 21:08

Yeah, so we have some cross signals. I'm gonna mute your mic. Go ahead and get yourself a little break. We have some cross signals there because folks, we lost jobs. Oh, you know, economy's not doing well. We see gold and silver explode, so you see copper, gold and silver explode. That's very inflationary. But yet, if we're losing jobs, that's deflationary because people competing for wages. There's some pushes back, and this is where crude oil comes into all that. It's very important in that that that the United States president and his administration get these get in better control of cost. And about at this point, one of the only things they'll be able to do is back off on Iran. We'll get into that more. But this is interesting that hey, we're losing jobs, but copper's on the high. Hey, we're losing jobs, but this is happening. And when these economic headwinds come in of rising inflation, the uh Fed's gonna have to make a big boy decision here in the coming months.

SPEAKER_01 22:02

They are.

SPEAKER_00 22:03

Yeah, they are. All right. Jobs report.

SPEAKER_01 22:06

There's your there's your unemployment rate, four point one percent. Look at the labor force protection. Participation, 61.4%. That was down zero, almost one point since January. Traders paired bets on a September Fed rate hike. So this is what this shows you the economist expected an 80,000 increase in jobs and they got a 23,000 cut. And then we also had May-June revisions that were down 103,000. Now that signals maybe we this economy is weaker than what they thought. And that was all embodied in that monthly report. But we're going to have to see if it continues.

SPEAKER_00 22:48

Let's get to real serious stuff. Senate Farm Bill 2.0, brush with death. That sounds serious, Jim.

SPEAKER_01 22:54

Yeah, but it survived. It survived because Chairman John Bozeman, Republican from Arkansas,

Senate Farm Bill Narrow Escape And MCOOL

SPEAKER_01 23:02

once uh the he knew that it was going to go down, he recessed the committee and he's going to call him back in the middle of September. They come back September the 14th. Yes. Now, Mitch McConnell wasn't there. That's why he didn't have the votes on the Republican votes. They needed 12. And both McConnell and Tommy Tubberville, Senator from Alabama, was there for the markup last Thursday, but he wasn't there for the final vote. I guess he knew it was going to go down. It was defeated 10 to 11. You always begin with the yes votes first. So what Bozeman did, rightly so, he just recessed it. That locked everything in place so he could bring everything back in mid-September. Hopefully, Mitch McConnell will return.

SPEAKER_00 23:56

Can we talk about Mitch McConnell a little bit? I have this graph. Do we get him a get well card, a sympathy card? Mitch McConnell, your guess is as good as mine card. I mean, this is what's with this guy.

SPEAKER_01 24:08

I feel for him because, you know, he's crossed in his life. He had polio as a kid. So he's dealt with he's dealt with a lot of things. No, well, that's more important than Washington, D.C. However, and he was, he he gave Trump what he wanted on the Supreme Court when he was majority leader. That's all his pluses. Yes, he probably should not have run for office the last time. The lawmakers have a habit of staying too long. Now, ironically, the same day as the markup of the Farm Bill 2.0 in the Senate, he was released and now he's back home in Kentucky recuperating. And he says he's going to take what they call the work period, the five weeks off that the Senate's off, to further recuperate. Whether or not he's back in mid-September remains to be seen. But if he is, uh the Senate Farm Bill will be approved. And the there's a narrow window though, Tommy, because if they don't get it done when he comes, if he doesn't come back, September 30th is the expiration for the current for the for the 2018 farm bill. Now remember, we had a lot most of it already dealt with in the OB3 bill, the one big beautiful bill with the reference prices, et cetera. But I think even if that were the case, Bozeman would probably have a short-term extension, thinking after the elections, they're going to come back with what we call a post-election lame duck session of Congress and they can get it done then. So I'm upping my odds that we'll eventually have a final uh farm bill this year. Because when you look through the markup vehicle that they dealt with, there was only one major area of disagreement, and that was the food stamps. So what Boseman is telling the Democrats, look, we gave you a one-year waiver of what the Democrats called were owner onerous language in the one big beautiful bill. Boseman's thinking when the senator, when the Democratic senators go back home and they're back home, so I'm at fairs this coming up in Missouri and I think Iowa this week, they're going to hear from constituents of saying, well, isn't one year better than nothing? Because we won't get anything if we don't have a new of a new farm bill that they've already offered. And if people knew how much work Bozeman and the Farm Bureau lobbyists, by the way, just between us, went to the White House and convinced the White House to go for this one-year waiver. That was not easy to get. And that means they're not going to get much more, if anything. So I think the Democrats will probably come back in a more accommodating mood in September, Tommy.

SPEAKER_00 27:08

Let's hope so, because we need a farm bill for food security and everything else here, moving on. All right, we got all types of letters here.

SPEAKER_01 27:15

MCOL, uh mandatory country of origin labeling. It was included, and look at the vote. It was approved by a wide margin, 16 to 7, all Democrats and a few Republicans on the Senate AG Committee. Now, I'll just bottom line, because we could have a whole program on MCOL. However, I do the House Farm Bill version does not contain MCOL, mandatory country of origin labeling. So that tells me it'll be a negotiated uh uh uh topic if it gets to the House Senate Farm Bill Conference. I do see MCOOL being in the final bill, but it it might be modified than the language that's in the current Senate bill. And that's really to deal with the concern with Canada and Mexico will very likely file trade complaints on it. So I think they'll work on the language, Tommy. That's the bottom line on MCOL. Higher odds now that it'll be in the final bill that gets voted on by the House and the Senate, but probably not in the same version that you saw clear that Senate AG Committee.

SPEAKER_00 28:25

Well, Jim, moving on, it wouldn't be a Weissmeier's perspective if we didn't talk about U.S. Iran war update. Same issues, straight to her moose. President Trump uh out with the true social today with some color, some inside baseball in Washington of people saying he may tone it down. Somehow

Iran Signals Strait Risk And Crude

SPEAKER_00 28:40

Hillary Clinton was involved. Maybe she commented or said something. I don't know. Not sure what her relevance is anymore, but go ahead. U.S. Iran war update.

SPEAKER_01 28:49

Well, they they they there was a Fox poll out today. 73% of Americans think there'll be an agreement. There there will be no agreement or a bad agreement if we have one. I that shocked me, you know. And Trump basically came out today and told uh I forget who he told, one of the wire services, that uh uh that he's gonna continue to put economic pressure on on Iran. He they're not gonna throw everything at them on on the on on the military side, which I personally think it's a mistake, but it's not what I think on on this one. So, but what Iran did this weekend, Tommy, is they basically gave their list of demands, demands on what they're gonna need in order to reopen the Strait of Harmuz. Well, that's that's a punch in the face on that one. But yet we're taking it, I guess. Well, it's gotta we gotta wrap this up at some point, otherwise it's gonna really uh tells me it's gonna linger, but but there but I think the energy markets could be pressured maybe Monday because they're seeing that Trump's not gonna be aggressive on the military side, that they're gonna continue the duration of the economic pressure. That's significant, though. And uh JD Vance, our vice president, said we're in the halfway mark with Iran. So that tells me well this is gonna go through. Uh I frankly, I think Trump wants to keep putting pressure on until the elections uh not to have it too volatile and then maybe hit them hard if this thing continues after November 3rd.

SPEAKER_00 30:36

There was talk from some of the services this week, also, Jim. This is kind of a side note, but that we're our uh our inventory of certain ammunitions and certain missiles and certain very specific high-tech things that we use to fight wars like that, that we are at like record low supply. So is it possible? I I asked you the question, is it possible that we're rebuilding supplies, taking a breath, getting four or five weeks here to get some more supplies over there, and then possibly we'd get aggressive? Just a question.

SPEAKER_01 31:04

A combination of that, but most of the people I talk with in the administration on this issue said told me there are some elements of of the of our defense that is short, if not very short. But by far, that doesn't mean that we cannot continue to put military pressure on Iran, the bombs, uh, etc. So the New York Times runs a story about every three days that uh guaranteed to get Trump upset by saying we're running out of XXX.

SPEAKER_00 31:36

It's not that hard to get him upset, by the way.

SPEAKER_01 31:38

No, it is not. No, it is not. But again, bottom line, yes, we're we're in certain areas, but but but this does not mean that we're impotent in the in the defense of our country. Bottom line.

SPEAKER_00 31:50

Very good. Okay, well, we got to run the graphic because yeah, I always have a every week I got a graphic on this war, and this one's too good. Here's what we've been talking about U.S. Iran, the clock's ticking, but where is it ticking to? Yes, we're moving along quick show this week. All right. Diesel Gidden? Is that a word? Diesel Geddon.

SPEAKER_01 32:11

Diesel Geddon. This is the lingering impact of an extended US-Iran war. Retail diesel hit 535 August the third, up a dollar fifty-five on the year, Midwest 526 a gallon, seven dollars a gallon in California, by the way. You think their California producers aren't yeah, in trouble? Trump era diesel, it's averaging almost $4.10. That's a cent above the Biden era average. That doesn't make the White House happy at all. The the reason is many, but distillate stocks, our stocks are 12% below a five the five-year average, and we're already the refining of diesel is they're they're already at 96 to 97 percent utilization capacity.

SPEAKER_00 32:58

That's basically you and Davis were talking about that. That pretty much is code for we're maxed out, right?

SPEAKER_01 33:03

Yeah, absolutely. So and exports, then this gets in the sensitive area. Export exports of diesel, U.S. exports, hit a record. And now I know a number of farmers saying, well, why are we exporting the stuff when we need it? Well, do you want us when when people say that we what we want our our beef, do you do you not export our beef, uh certain cuts, or do you export you not export corn? So you don't want to do that. Stocks are decreasing also when they usually seasonally build. So there's a fundamental reasons why diesel prices are firm if not going higher. The Gulf Coast alone drained over five million barrels, and that's because of exports. So, okay, what this means harvest season, diesel and basis is going to be vulnerable to any hiccup. That means hurricanes, tornadoes.

SPEAKER_00 33:56

Yeah, we're in hurricane season. Yes, then a little quiet.

SPEAKER_01 33:59

So the diesel, what what what we're saying here, hopefully, and this is what uh Davis said on Friday. Hopefully, farmers bought the dip here, what, about a month or so ago. Diesel went down. So hopefully they got some coverage there. But diesel is firm and is going to probably remain firm basis the fundamentals we just talked about.

SPEAKER_00 34:22

All right. Number nine, ethanol exports bounce back. There is some really, really good news here within these slides. Go ahead, Jim.

SPEAKER_01 34:29

Export jumped 46% the weekend of July 31

Diesel Prices Tight Supply And Exports

SPEAKER_01 34:34

because we had a down week the week before. The third straight record is in reach. In other words, three consecutive years we're gonna have record exports. January-May exports now are 12.5% ahead of last year's pace, which was a record, Tommy. And we're gonna go toward two and a half billion gallons of exports of ethanol. And look north. Canada is taking roughly one of every three barrels that we export. So this is why we shouldn't get too negative on Canada. If you're a corn producer, they're taking one of every three barrels that we're exporting. So that makes our neighbor to the north a very friendly neighbor when it comes to ethanol, period.

SPEAKER_00 35:21

Yeah, that's all good news. Well, we're getting towards the end of the show. I told you folks it'd be a quick one. Number 10, the Jones Act suspension.

SPEAKER_01 35:27

The Jones Act, when it's in place, means that when you're shipping interest states and and and ports, you have to use U.S. vessels, which tend to be higher to much higher than foreign flag vessels, and the availability of U.S. vessels are are very weak in many cases. A few months ago, the White House, as a result of the U.S. Iran war, suspended the Jones Act. They at that time they extended it to 90 days. Now, Energy Secretary Wright signaled this past week another renewal is likely before the current suspension extension expires August the 16th. I think there'll probably be a narrower extension, maybe 30 to 60 days versus the 90 we had before, because they'll want to show that some progress may be in the US-Iran war. If they have another 90-day extension, that's that the optics aren't good there. Now, the suspension, by the way, has been used nearly 200 times through July. It doesn't save that much on energy prices, around 6.6 cents. However, that doesn't mean you don't need it. It's kept fertilizer uh uh supply coming through uh as far as the shipping of it. So that's good for fall ammonia movements, Tommy. That's your bottom line there.

SPEAKER_00 36:56

Very good. Before we finish the show, let's uh take a little break here, just tell you who we are, what we're doing. Of course, I just want to go over some housekeeping. Axwak AM and Axquak PM, Axquak AM with Mr. Jed Sidwell

Ethanol Strength Jones Act Crop Insurance

SPEAKER_00 37:08

hits all the platforms by 8 a.m. Axwak in the afternoon with Mr. Davis Michelson is in all platforms, and those platforms are X, Spotify, Apple, YouTube. Please do us a favor, like and subscribe so you can get notification when those shows are out. Of course, premium content's available that we text in email. That's $25 a month, $250 annually. As we were speaking, Jim, uh, someone subscribed and paid. And that makes me really happy because you and I and Davis and Jed and everyone were talking, and people have asked us, we have a question. Someone said, Who is the sponsor of your show? Well, of course, we have plus 500 in Trade the News, who we always mention. And plus 500 is the software we use on our phones and laptops, and they're also an FCM. Trade the News is an audio squawk service that I I've been a client of Trade the News for 25 years, if that's not a testimony to them of how good they are. But this show is sponsored by you, the American Farmer. And for many years, Mr. Weesmeyer has given out his newsletter for free. That soon will be changing. So I ask you all, make sure you stay in touch with us. If you're on Jim's list, you're all good to go. You'll be sent a coupon here in the next few months to get registered as a paid subscriber to uh Jim's service. It'll be affordable. I promise you'll be able to afford it. Matter of fact, if you can't call me and if things are that bad, we'll make sure you get it. But the cost of doing business has gone up tremendously for all of us. So Jim will be moving to a paid-for service. And with that comes technology that to get these texts out and get this information to you, the American farmer, or someone who just loves agriculture, or someone who's business-minded. I've met so many nice people over the last few weeks and months of my travels. And they said, Why isn't Jim charging? I said, Don't worry, he'll start soon enough. And Jim, by all that dental work you had, you you need a little GoFundMe page.

SPEAKER_01 39:07

I had three teeth that had to be redone. Uh so yeah, that's uh cash flow, cash flow, let me tell you. Another reason, Tommy, is uh yeah, uh I gave it away for for many years actually, yeah. As a give back to agriculture that's been so good to me. But I'm gonna be speaking less. That doesn't mean I'm not gonna speak at all. But I I'm into my mode now where I like to do more research. I'm back to my research days and writing, and I like to be at my home office for that. So with that in mind, we're we we're we upped our game in graphics, uh analysis, and it looks pretty prettier, things like that. And so we're gonna uh uh uh you know keep improving, and that's what I like working with you, Tommy, that you drive us to to improve. And and again, you have my personal commitment. We're gonna be a lot more reasonably priced than some of uh the other information services that you get, hundreds of dollars less. Okay.

SPEAKER_00 40:15

Yeah, I like that.

SPEAKER_01 40:16

Where are we at on the on the topics? Are we done?

SPEAKER_00 40:19

No, baby. We're not gonna be able to do that.

SPEAKER_01 40:20

Okay, I want to end it with one. Yeah.

SPEAKER_00 40:21

Well, we did the Jones Act, and we got Rollins's.

SPEAKER_01 40:27

She was in Minnesota. She she announced that producers have up to 60 more days on premiums billed crop insurance billed July 1 to September 30th. Now, that interest is waivable, and USDA also is deferring collections from insurance providers, so they're not out as well. This is cash flow relief, Tommy. This is not debt relief. So, for perspective, if you delaying a $100,000 premium, and more than a few farmers have a hundred thousand dollar premium, 60 days saves roughly $1,300 at 8%. So it's it's not it's that's a chunk of change there. Of course. Yes, the bigger benefit, and you'll know this as a marketing help, it avoids forced grain sale or an operating line squeeze. So that's called money management. USDA also restored finally officially the optional 5% prevented plant uh buy-up that they should never have done last year.

SPEAKER_00 41:31

That was a mistake in your opinion.

SPEAKER_01 41:33

Yes. Oh, absolutely. And USDA launched an official data listing tour primarily to improve uh the NAS data. And she implored farmers, I think rightfully so, talk to us. Tell us where you think that that NAS and USDA can improve on their data accumulation to increase the response rate. And they're gonna come out with, I think, a final report November, December. I think uh Deputy Secretary Stephen Vaden told us that. And she basically echoed, yeah, she basically echoed that. So I I applaud uh NAS for taking the challenge, and they have to improve. It's just like in the communications and in ag that we're dealing with, times have changed, and they got to change what the Tommy.

SPEAKER_00 42:22

Yeah, can we send the bat signal out there, Deputy Secretary Vaden? We're ready to have you back on the show because you talked to us about this four or five months ago and made it perfectly clear that things need to change, that we have a postal problem, not so much a USDA problem. We have a technology problem. And just like Mr. Jim and I said that we're up in our game, whether it be Agble Intel that you could subscribe to or Jim's thing to subscribe to, Deputy Secretary Stephen Vaden said, We have a technology problem, but we need your input, and we need to get these data, these surveys out sooner, and we need to get them back sooner. And that shouldn't involve necessarily the United States post office, Jim.

SPEAKER_01 43:03

Yeah, yeah, it shouldn't. It should be more digital so farmers can do it online so they don't have to rely on the stale mail to get it and also to send it back. So, and there's other things with artificial intelligence, satellite technology that NASA's has to up their game in that area, and I think that they will. You give NASA a problem, they'll eventually deal with it. I there are quality people there. They're statisticians, they want to do a good job, they don't want to do a bad job. So I applaud them for again taking the challenge.

SPEAKER_00 43:33

Yeah, we we have missiles that can land on a camel's ass and blow it up, and all of a sudden we can't get a data survey. Number 12, FDA and ultra-processed foods.

SPEAKER_01 43:43

This is an agribusiness one for sure, and a farm-to-fork one, too, because the definition was sent by FDA to

Ultra-Processed Foods Definition And Week Ahead

SPEAKER_01 43:51

Office of Management and Budget as a white paper, not a rule. Now it sets the framework, but doesn't impose labeling or formulation changes at this time. These are ultra-processed foods. You know, that's the big middle of any of the supermarkets.

SPEAKER_00 44:07

The yummy stuff.

SPEAKER_01 44:08

Absolutely. That I'm not buying as much, by the way, because it tends to increase your weight. Ag exposure is going to come later once we know the rules. The labeling, however, is going to be key for school meals, state laws, possible pressure ahead on corn sweeteners, starches, and maybe some meat. So we're going to have to see. But there's opportunity in anything for real food in quotes categories. So this is one where we're beginning to see they're getting ready, but by the end of the year, Tommy, we should have a true definition of what they're coming out with as a proposed rule.

unknown 44:49

Okay.

SPEAKER_00 44:49

Absolutely. Yep. Before you take us home, folks, I do challenge you to make sure you click on us in the morning, in the afternoon. Those shows will remain free. Whereas Jim and I, folks have been asking me, Jim, I don't see you on this AM and PM show. That's because I'm behind doing the premium shows, the premium content, the text alerts. If you want Tommy, you want to call Tommy, you got to call 855-737 Farm. If you want to get on Jim's newswire, Jim's uh you know, list to make sure that you get that coupon for him going chargeable agbol.com. If the USDA needs to get their act together and start incorporating technology, so do we. Mr. Jim, do it only like anyone can. One year straight, Tommy and Jim, take us home, brother.

SPEAKER_01 45:31

Well, AgBull Media, you see my special reports, and every Saturday or Sunday I put out the week ahead. Now, this one, Congress is gone, but the week is anything but quiet. We're going to see it. Both chambers are scattered until September, House and Senate. But Wednesday is the key date because that's when we get the July CPI report in the morning. And then in the late morning, 11 o'clock Central, USDA's first survey-based crop estimates for corn and soybeans. Iran names has named its price for reopening the Strait of Harmooz. The EPA's refinery waiver docket looms over biofuels. It could come this week. Fort Morgan, we haven't talked about that. Their locked out meat packers are going to weigh eventually another vote on Cargill's offer. Now remember, it was only defeated by 25 votes. So I think it's a matter of time before we get that plant uh back into operation. And five states this week hold primaries. You think this week is not going to be busy? It is. And we're going to reserve judgment on any positives until we see, as well as the traders and farmers want to see, the results of USDA's crop production and the supply-demand report. We've got a lot going on Wednesday.

SPEAKER_00 46:48

Well, we got the right team together to deliver it all. I'll see you next week, brother.

SPEAKER_01 46:52

Sure.