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Tommy Grisafi is the main host and content creator for Ag Bull Media.
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Wiesemeyer's Perspectives | 1000 Year Flood Hits Indiana
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
We start with a hard-earned lesson from Indiana’s storm damage: being prepared saves money, stress, and relationships when the grid fails. Then we connect the dots across USDA numbers, crop tour risks, geopolitics, energy, and livestock shifts that are moving real prices in agriculture.
• power outages as a real-world risk model for farms and households
• weekly commodity moves across corn, soybeans, wheat, cotton, cattle, and hogs
• the five biggest drivers: Russia-Ukraine, extreme weather, Tyson changes, energy, and a rail merger fight
• USDA acreage and yield shifts, with corn carryover tightening near key stocks-to-use levels
• Why soybeans hold up better with China buying and inventory moves
• flooding and heat impacts that the Pro Farmer Crop Tour may not fully capture right away
• data centers in rural America, farmland tradeoffs, and pressure on power and water costs
• Black Sea port strikes and the “uninsurable” risk that can shock global wheat prices
• US-Iran pressure, shipping chokepoints, and what higher crude means for diesel and fertilizer
• Jones Act waiver extension and why agriculture is wary of rail consolidation
• Tyson plant closures, packer margins, and structural questions in the beef complex
• screwworm stabilization, phased border reopening, and the Mexico value-added question
• demand pull setup to watch through export sales and user coverage
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Preparedness After Indiana Outages
SPEAKER_02Welcome back everybody. Tom Grassofi, AgBull Media, AgBull Trading. You're listening to Wee Smires Perspectives. I just want to thank you all for joining, like you do every week. Really appreciate if you click like and subscribe. What's that mean? The second this video comes out. If you subscribe to the YouTube channel or hit notifications on Spotify or Apple or wherever you enjoy listening or viewing the show, that'll get the word out. You know what else helps too? Drop a comment down below. I was talking to Jim before the show. I just, you know, being in Boy Scouts and all that stuff, you think it's what are you learning in it? But the Boy Scouts had a motto, always be prepared. And when the power goes out for 350,000 people in Northwest Indiana, you know, it's nice to have a generator, Starlink, a backup plan. My internet's turned on and off 10 times this week. Didn't affect me. I have Starlink. Of course, that comes at a cost. But what's the cost of throwing out three freezers worth of food or anything else? So we learned a lot the last week. The American population's not meant to go without power, internet, all the fun stuff. We are blessed in one way here in Indiana. It wasn't too warm till today. But now temperature is 85, 88 degrees. We've had extremely mild temperatures. A big heartfelt shout out to all the people in central Indiana. We got the winds here in northern Indiana. They got the rain. And Jim and I will talk about that more here in a little bit. But as always, I'm super excited about this week in agriculture. It's the Pro Farmer Crop Tour. Big shout out to our friends Chip and everyone who goes on that. They are the best of the best. And let's see what they see out there. Enjoy the show. Let's get ready to rumble. Oh, Mr. Jim. I am so grateful they have power, internet, a house full of food. I gotta give a shout out. Probably nobody in the world will hear it. But I went to Stratch and Van Till grocery store and I went to high school with the Strax. And when I walked in the Strax, they said, How many bags of ice do you need and how many cases of water? This one's on us. And boy, the line was out the door. The people of Northwest Indiana are hurting gym. It's more of a financial hurt from trees falling on homes, not being able to go to work. My my my brother-in-law owns a pizza place. They haven't worked for five days. They had to throw out all the food. They're getting power. They're going to try to restock. But the financial damage to the state of Indiana is in the billions. And you know, these these you you go to a normal neighborhood, these folks aren't meant to, they're not built like farmers, Jim. Yeah.
SPEAKER_00Absolutely. One in 1,000 year reigns. That'll tell you all you need to know there. And but this is the role, the good role of government people helping out. And that's what we're seeing, hopefully, across all the affected areas of Indiana, but it hurts nonetheless.
SPEAKER_02Yeah, you have friends calling out, hey, does anyone have their power on? I still need a generator. The biggest problem, we did not have as big of a water problem as we had a wind problem. But all these people who have some pumps, they run for a few hours or a day. So now in a lot of these neighborhoods, they're just massive flooding in the basements from not having power. And it's just a big financial toll on the area. But we'll come back and compared to the people in central Indiana, you know, we have some people have a few inches of water in their basement. Those people have water up to 20 feet high, flooding in the homes and areas. Some of the tape coming out of there is just horrendous and fancy areas too. Jim, I don't know if you've ever been to Carmel, Indiana, Fishers, Indiana. These are all the fancy suburbs of Indianapolis and the absolute disaster. I will compare it to a uh mini Katrina type uh natural disaster. It's just horrible. Just horrible.
SPEAKER_00Well, let's get to some good news. Yes, I'm I'm official. She's got five of them that she set of a different color.
SPEAKER_02Well, I'm happy. Well, thank you. We're happy to have you. That is called the official. What color is that? Because that's Weismeyer. Maroon. I would say that's Weissmeyer maroon.
SPEAKER_00Yeah, I like maroon.
SPEAKER_02And you threw out some crazy things. I need a white shirt, a yellow shirt. Jim, I've seen you eat. There's no way I'm gonna put a white shirt on you. You'll have dribbles all the way down. True, true. All right, let's talk about some good stuff right here, brother.
SPEAKER_00Look at the green, as we say on the right hand side. This green is green, corn up, weekly change over 21 cents, being 16 cents. Look at
Commodity Scoreboard And Cattle Volatility
SPEAKER_00oil, led the uh complex there up 120 points. Wow, look at HRW wheat, wheat led the way. It's because of not anything in America, it was Russia, Ukraine that we'll get into later. Cotton, if you look technically, the fabric of our lives, cotton, cotton is really on a run here, so that's good. It wasn't all good news because we had uh the thing called Tyson that we'll really get into later. Live cattle down. Look at feeder cattle, down over 10 bucks, right? Yeah, so we're adjusting. But I think you you said something Friday, Tommy, on with you know Davis Michelson that they actually did better Friday. They came back a bit, right?
SPEAKER_02Closed on the dead high, and then what we in the trading world call the curb, the market closes at one, but we stay open for five more minutes. We traded above settlement. That was a wonderful, wonderful sign for the cattle producers that we digested. Now let's go over it. Let's connect dots as you've taught me. Yes. We're worried is the border open or closed, open or closed, it's kind of open. We're really worried about screw worm. What's going to happen if we get screw worm? We have it, we're dealing with it. Okay. Three, there's been a lot of rumbles in the industry for a long time that Tyson's just changing the way they do business. And they changed. They made a major announcement. We'll get into that in a few slides.
SPEAKER_00And on the plus side on cattle, which was, I think, another reason we came back. Demand. Oh, yes. Demand continues robust. So there's your saving grace in the meat complex.
SPEAKER_02Yeah.
SPEAKER_00And I think this is another way. This chart here is another way to look at it. Look at the feeder cattle. That that they get the biggest bar on the left-hand side, which is the lost column. And you can see HRW wheat up, let's call it six percent. You know, that's that's pretty good. And corn and soybeans are reflecting post-USDA reports and this coming coming crop tour that we'll really zero in on.
SPEAKER_02Can you give us a little color? You put out a lot of content last week, and we'll give folks a reminder. Jim's putting out stuff all day long. Oh, I gotta switch you. Look at you deserve to be on the left screen, big screen. Okay, you're putting out content all day. Just in your head, what was the five stories you think people should uh be reading? And if you didn't read it, go to Agble.com, search for the Weissmeier tab. What were your big, big stories last week?
SPEAKER_00Well, the first one, we led the way.
Five Stories Driving Ag Markets
SPEAKER_00So the Russia-Ukraine thing is it's getting real now. It's it's it's affecting balance sheets, okay, around the world. That's one. Two is that the weather-related issues that we've already talked about to a degree in Indiana, etc., as it now as we go into crop tours, that's number two. And we've got several curtain raisers on the pro farmer crop tour. In fact, I did one today. Three is in the cattle. We've already mentioned it, but we're gonna detail Tyson uh led the way on the downturn on it. And there are structural changes going on in the cattle industry, those are three. Uh, four, uh I can't uh let's see, energy. You know, U.S. Iran with the energy, yes, but you were up about six percent that we'll show later on for both WTI and and and Brent Crude, and that impacts the fertilizer significance. And the other story that didn't get maybe a lot of coverage is the National Grain and Feed Association came out against the big railroad uh merger. And I I don't not oh it doesn't mean it's the kiss of death on that merger, but it probably hurts it a lot.
SPEAKER_02Okay, and that's inside baseball type stuff. I'm not I I'm I if you ask me one through ten what I know about railroads, I'll tell you I get pissed off when I get stopped by a train. That's about as much as I could tell you. Let's a good stuff.
SPEAKER_00I have I have I'm a train collector, Lionel trains.
SPEAKER_02I still have Lionel trains. I did not know that about you. I still have my uh first trains my parents gave me under the Christmas tree uh many years ago. I'm about ready to give them away, though. So I they're sitting in a box, they haven't been running for a long time. And but uh I do like trains actually. Yeah, speaking of the crazy.
SPEAKER_00Here we go on the USDA reports.
SPEAKER_02Without trains, we would not be moving grain all over this great country. Oh, this was a
USDA Acres Shock Corn Traders
SPEAKER_02whopper.
SPEAKER_00Yes.
SPEAKER_02Go ahead.
SPEAKER_00Well, USDA reports. We're just gonna bottom line it. The acres they raised both corn and soybeans about 1.4 million acres. So, you know, uh, why didn't they know those acres, Tommy, and June Acre survey? I think that's a legitimate question that should be asked to NAS. That this is this has been a recurring theme here. So I they they've gotta I like the NAS people, but they gotta look at that acreage report because they did cut the corn yield to 180.7, and that was down 2.3 bushels. Yeah, 2.3 bushels from the July trend yield and carryover. This is what drove the corn market. The carryover, despite that increase in acres, the corn carryover fell to 130 fell 137 million bushels below July. You're just I think a little over 10 stocks to use ratio. Now that's a key because if you get under 10, you talk about a firm-to-bull market. So we're gonna have to see that in the months ahead. Watch the stocks to use ratio. Okay. Uh soybeans uh yield of 52.7. That was a yawner. The carryover actually went up. So on the surface, soybeans was uh neutral to bearish, but it tagged along, but tagged along because of the corn and wheat and cotton and and other positive elements from that report. Wheat, we're gonna just it was all Black Sea premium is back, and we're gonna handle that later. But that was the significance for the wheat in week in wheat. Sorghum. We always talk Milo on this show because I've got a lot of contacts in Texas and Oklahoma that grow sorghum-milo. USDA cut the crop 84 million bushels. Yeah, when it comes to corn, that's nothing. It's a sorghum, it's a big cut. How big? 22% from the July assumptions. That's 32% lower crop, Tommy, than a year ago. Now we don't have a sorghum futures market yet, so you couldn't really trade it. You could trade it to a degree in corn, but it's going to lead to more corn domestic utilization. I think that was another shot in the arm for corn. It's got another booster there. Cotton, we mentioned when we went through the prices, the yield was cut, but the USDA also increased the acres, but the production is still below July. So that's all the all the traders needed to keep uh cotton on the rise. Cattle, it's all Tyson, and we'll detail that later. Hogs had a bearish weekly low close Friday. October hogs are $14 under the cash. It just doesn't look good for hogs, Tommy.
SPEAKER_02No, and I'll talk to my good friend who's a hog producer, and I'll ask him, what the heck is the problem over there? Because you'd think with elevated beef prices, people would switch to pork as an alternative, a healthy, good alternative. Pork, but they're they're not doing it in a way that's a good thing. I think exports are dying. I was just gonna ask you, is it coming from that domestic usage is fine and exports isn't? But uh I'll ask my friends who uh my true hog producers who no one knows better. And yeah, that's interesting. Okay, all eyes on uh weather, and then we'll talk war.
SPEAKER_00But uh weather we've got uh two uh locked-in regimes that we've been through the Ohio Valley flooding that we've talked already a lot about,
Floods Heat Dome And Crop Tour
SPEAKER_00and the southern heat dome. You talk about hot. I talked to you know, Bart Fisher is a top economist at Texas AM, and he's a Oklahoma hog producer and and wheat, and he was out in the fields in in Oklahoma, and I think he told me it was 107 there. He was just beat this past week. He's a hog producer in in Oklahoma, big hog producer, yes.
SPEAKER_02Absolutely, yes. That's interesting. Color okay. When we talk about weather, we got to talk about water, but this does not talk about wind, and I'll add color there.
SPEAKER_00Sure. Look at these are the numbers over 12 inches in in uh some areas, uh, right around 12 in Newcastle, Anderson call it 10 and a half inches, and look at Perry County, Ohio. They had six and a half inches plus in hours, just a few hours, and parts of Illinois and Iowa over six inches. And that's what the tour is going to see now, the residuals of that. I told them to bring an extra pair of socks, Tommy. They're gonna have relatively good weather after this weekend in in most of the tour belt areas, but they're gonna need boots as they go through some of the fields, Tommy. But look at that that rain, one in one thousand year rains in Indiana. And that you're not gonna see the full effect of the crops in Indiana for two to three weeks, I think. And now you'll know silage, you can smell silage, okay. But I think farmers know this. The crop tour may see a better crop than it actually is as a result of the delayed response to the ponding. I think there's flooded fields in key portions of Iowa and and Illinois. That's what they're gonna see.
SPEAKER_02And also, you know, if I was on the crop tour and I was driving down the road and supposed to stop and the field was flooded, I'd probably keep going another mile and find a dry one. I mean, I know uh they do their best, they do thousands of samples. Big shout out to the good folks at uh ProFarmer Crop Tour and all the volunteers, all the people support the tour. Some people get very angry about the tour. They call it the you know that they don't want people on their property and everything else. And but you know, last week you and Davis talked about talk about angry. Uh, we'll throw this. You didn't see this little beauty last week, but this data centers and farmers. I mean, that's talk about someone being on your property. That's that's a hot, hot issue.
SPEAKER_00And uh yeah,
Data Centers Versus Prime Farmland
SPEAKER_00and but it as with anything, it needs balance both sides. Data centers are gonna pay a lot of farmers a lot of money if they're close to the grid. But do you want to take good productive soil out of it? Uh the these are not easy issues there, and it's just starting in rural country. Now we're gonna see the growth at data centers in rural America. We had a big special report on it this past week, and that's why Davis and I talked about it, Tommy. But there's no right or wrong answer on on that, let me tell you. But it's gonna increase in some some cost in rural America.
SPEAKER_02Well, I've noticed my electric bill went up a lot significantly. Like that's maybe 25% last year. Like maybe my electric bill used to be 250, 300, it's up to consistent fours.
SPEAKER_00And it it has it's played a role. I know in I'm in Loudoun County, Virginia, and we're number two, I think, in data centers in the United States. Is that because it clearly well, I you know, it wait the grids near here.
SPEAKER_02Closeness to how far are you? If I jumped in Uber from where you can six miles to DC. Okay. Not far. Not far. They don't, yeah, that's why they keep a fence around the White House to keep people like you out.
SPEAKER_00But it also increases your water cost and so in rural country, and they're getting better at that. And I think states and districts now are asking finally the right questions. Are you going to utilize your own energy? What is your water efficiency? Things like that. Those are the things to ask for. So, and I think there's an element of both. We need data centers. It's because of for the artificial intelligence growth. We don't want to get behind China in that regard. So let the debate uh continue. But just don't think that there's one right answer because there isn't. It's going to bring a lot of money, a lot of money to certain rural areas, but at what cost?
SPEAKER_02Yeah. Real quick story about data center. I was driving along with a young lady and her mom, and she said, These data centers are so bad. I said, give me top five reasons why data centers are bad. She went to ChatGPT and asked why data centers are bad. If you understand how funny that is, I mean, that is just that's thinking good, which is not good.
SPEAKER_00Good, not good, not good.
SPEAKER_02What's that called? Like what it I was thinking the word oxymoron, but maybe that's not it.
SPEAKER_00Like oxymoron is something that that is you think it's false, but it's true.
SPEAKER_02Oh, okay. I'm going the other way. But when you're like, no, this is horrible, and then you use the very thing you think is horrible to prove that it's horrible. I mean, I I don't know what the term is. Someone tell us on the show.
SPEAKER_00Hey, what's in the hen house? That's Fox in the Hen House. Okay, there we go. Thank you.
SPEAKER_02Thank you. Well, let's talk about the Pro Farmer Crop Tour and give folks uh they're gonna start on the Western Belt, Eastern Belt. You popped a good map in here. They'll be in the great state of Indiana on day one. They start in Ohio and they drive to the center of Indiana, then they go to center of Indiana, center of Illinois. Now in the west, they start in Grand Island. Move over one thing you need to know, folks. This is very, very much a central crop belt tour. This is not North Dakota, South Dakota, Georgia, state of New York. There's a lot of great states in here: Wisconsin, Michigan. It's the heart of the Corn Belt. But the Corn Belt Jim has expanded so much since uh Chip Florey and his group started this. You want to talk about that?
SPEAKER_00Many years ago. And it's really North Dakota. And North Dakota has one had one of their hottest summers. And we had a curtain raiser crop tour uh report out this morning, Tommy, on Agbol Media. And I have a whole section on North Dakota on that one, and it's echoing some of the problems that the other portions in the Western Corn Belt has had. So absolutely that can North Dakota is very important once it comes to uh both corn and soybeans and canola now increasingly so they're growing more and more canola along the border there.
SPEAKER_02And the reason we're talking about all this different grains is because what didn't get planted in America? Wheat, because the economics were so bad. Then we had this horrible, horrible drought in the wheat belt. So North Dakota farmers chose to plant corn, soybeans, and a record amount of canola. And that also you could CC that for the Canadian farmer. And you know that from talking with Mr. Mr. Haney as much as you do. Yeah, Sean Haney, that you know, Canada's awesome at growing wheat and canola, but they're they're having problems with their production, also, true.
SPEAKER_00Yeah, their acreage went way up in canola, but their price went up significantly this past week. And I think it's on the demand side again. So it's this big D demand that we're going to see now because as a result, I think what the crop tours is going to eventually signal, just look at the direction of the crop tour. And you've got other tours that are going on, especially in Illinois and Iowa. Uh, Dan Bossey's group, Ag Resources. They didn't like what they were seeing in Illinois and Iowa.
SPEAKER_02I feel like Dan's been pretty bullish lately, though, to be very bullish, very bullish.
SPEAKER_00Yeah, very bullish. But but I think he's at least given reasons why. Yeah. But then your your demand's gonna kick in. That's gonna be the fourth and fifth gear in a month or so. Once the users, you know, when when we say good news higher prices, that's not good news for a user. Okay.
SPEAKER_02Right, right.
SPEAKER_00But they're going to have to get some coverage out there, and that's what you're gonna get your next leg up in what usually in the past has been the most solid bull markets for corn and soybeans, is when you have big D demand come in. And and the numbers uh and the signals are are are I'm sensing that, Tommy, and we'll see if it's right, not only for corn and beans, but also relative to wheat and Russia-Ukraine.
SPEAKER_02Absolutely, folks. Real quick, if you we've told you in past shows, we'll just remind you again, Jim is migrating over to the Ag Bull platform. He it's official because he has the shirts, and I think he thought those shirts would never show up. But uh you got a nice little care package. You got shirts, an American flag, a rain gauge. You're doing okay. Jim, if people aren't on your newsletter, they need to go to the Agull website and just go under contact us and say, I want to be on Jim's newsletter. Over the course and the next few months, you'll start receiving emails from AgBull, and we are going to send out a code. The next few months so that you can move over to the uh subscriber base of Wees Meyer's Perspectives.
SPEAKER_00Yes, now important. If you're already getting my letter, you don't have to do that because we've already got you on my list. So don't worry that you're gonna get a coupon later on.
SPEAKER_02Is it safe to say you know who's been naughty and who's been nice? Oh, absolutely. All right, let's get back to the show here. All right, Russia-Ukraine.
SPEAKER_00There we go. Look at look at this, it's it's become a balance sheet now. Now it's starting to get into the marketplace, Tommy, because I wrote
Black Sea Strikes Rewrite Wheat Risk
SPEAKER_00another special on this today. It's it's Ukraine's drone swarms had a uh a swarm of drones that touched into the heart of Russia, and then Russia's port strikes have converged into a single campaign against each other's uh economic depth, and the wheat market is starting to price it in.
SPEAKER_02So what was that BS Thursday when you're like, boy, look at wheat go? And then I texted you, Jim, wheat just broke 22 cents in 10 minutes. You know, there's conflicting headlines, and it's not President Trump putting out two true socials. Who's putting out this BS?
SPEAKER_00Well, it's uh you never know, traders. It it there was a report that Ukraine offered Russia a uh truce on it, but Russia looked at it and didn't accept it. But that was intra-trading day. That's what happened. They thought that there would be a truce, and there's still enough time. I think it's it's gonna take months and not weeks in order to clear the mess up that they've made, but it didn't work out. So the question, Tommy, is no longer which army holds which village in that Russia-Ukraine war, it's whether either economy can keep moving goods and at what price the rest of the world absorbs the difference. So, in our special report, we lay it out where all the ports are, what's the damming?
SPEAKER_02We have a chart of that here. Come on.
SPEAKER_00Yeah, we have charts and everything on that one.
SPEAKER_02Uh, this is different. But uh, let me go back last week. I do have a chart for you, Jim. I'll pop it up. I still have last week's chart up of the uh Ukraine. Okay, here we go. You see the little red X's, Jim. If not, I could read them.
SPEAKER_00Yeah, no, I can see them.
SPEAKER_02Okay, what's going on here?
SPEAKER_00Oh, well, Odessa is the big one that that you have to watch out for. That that's a key, that's a key port grain handling area. But you can see both uh in the Russia and Ukraine how they're hitting how they're hitting each other, you know. And in our report this morning, wild berries, believe it or not, has become a strategic target.
SPEAKER_02Did you say wild berries?
SPEAKER_00Wild berries. It's one of the largest hubs in Russia's wild berries network. They handle the storage, sorting, and redistribution of goods across central Russia. And so they're attacking them. So so Ukraine has has returned to those wild berry facilities repeatedly through the summer. And the Financial Report uh Financial Times reported over the weekend seven of the company's 10 largest logistics hubs have been struck in the wild berries, so it's made a big, big difference.
SPEAKER_02I always learn something from you, Jim. Wild berries gone wild. This is uh AG 13 now. All right.
SPEAKER_00So so the what we're saying is the Black Sea has become a two-way siege. What had largely been a Russian campaign to suppress Ukraine's maritime exports is now a reciprocal fight against the grain gateways of both countries. So I want to put caveats here because we've seen before if there is a bona fide truce that can be confirmed, that'll be a negative. That'll be a negative. Okay. But uh the the largest Ukrainian port on the Danube, uh Is Ismail, it has record low water levels, and that's already limiting the cargo movements. And that was before the latest attacks, Tommy. So I'm trying to get to my total bottom line on this because we write so much on it because it's so important. The the danger is no longer one damaged elevator or one missed shipment, it's the repeated strikes have convinced shipowners and ensures that the entire Black Sea grain system, both Russia and Ukraine, is temporarily uninsurable. That's the point at which a regional port war becomes a global wheat price shock and it's closer now than it was a week ago. That's your market analysis.
SPEAKER_02I'm gonna add some more color to that and also promote our sponsor, Trade the News. Trade the News is a service we use to get an audio squawk news service, Trade the News. If you'd like a free trial, head over to Trade the News, tell them the Agble boys sent you for a free trial. But the reason I bring up Trade the News and this is so important, Jim, is I keep hearing Trade the News mention that Russia thinks they have enough fuel to do this, insinuating they are running out of fuel or low on fuel or fuels in the wrong spot. What's going on with energy in Russia?
SPEAKER_00Well, they're they're having to import some and they're having to ration some. And of course, that's got into the diesel uh fuel market as well. So, yeah, this is I uh ironic to say the least.
SPEAKER_02Uh because they have a lot of energy.
SPEAKER_00Absolutely. They can't get to it, uh, or it's been put out of commission.
SPEAKER_02Well, that's move.
SPEAKER_00It's a true subject logistics and input war right now, uh uh of drones, not not people, thank goodness.
SPEAKER_02Well, it wouldn't be a Wiesmeyer's perspectives if we didn't talk about U.S. Iran war, the stage is yours.
SPEAKER_00Okay, both sides are digging in. Yesterday was this remember
US Iran Pressure And Oil Routes
SPEAKER_00the 60-day truce?
SPEAKER_02Yeah, well, that ran out.
SPEAKER_00There wasn't a truce, but it it ran out. Now, Treasury Secretary Scott Bessent last week said now the US and Trump confirmed it, they're gonna have a new campaign. It's called economic fury. Now, whenever they give something a name, you got to set up and take notice because they'll they'll actually follow through on that. A lot of times Trump backs off. That's the tackle, Trump always chickens out uh syndrome. But on this one, once they name something, they'll usually follow through. What Besson signaled was a financial bombing campaign, in essence, is coming, and they're gonna try to continue to squeeze the the whoever leads Iran further and further. That'll lead eventually to regime change because the people won't be able to stand it and they'll rise up, it'll kick them where it hurts, right?
SPEAKER_02In the pocketbook.
SPEAKER_00Absolutely. But but Iran on the other side, their dig is that they're digging in on the Strait of Harmuz and the Houthis in the Red Sea port area, and we there it is.
SPEAKER_02Yeah. And not a lot of oil is going through there. But I did you and I were talking off the record before the show, and maybe I'm out of pocket talking about this, but isn't the world finding other places to get fuel and fertilizer? And I think that's part of Trump's plan. Like, you know, if we could let this go on for long enough and wrap this up before midterms, the world's getting used to getting their fuel and fertilizer from somewhere else, and ultimately and and there's there's more oil getting through at night, even in the strait, than that they're admitting publicly, Tommy.
SPEAKER_00That's what the intelligence people tell me here. And that's a good thing. That's a good thing. So, but but what's the impact? Let's get the well, you know, why are we talking about this? Well, it's the energy prices, and that's the next that's well, there's your chokeholds on all that. This gets you into the Red Sea area, you get you Straits uh Harmuz, which is north in this map in Iran, then you can see the other uh uh choke point uh in in the Yemen area. And that tells you that basically logistics are blocked in a major way. That's why these alternative routes are being sought after, and eventually there'll be an increase in the pipelines outside of that region.
SPEAKER_02Uh folks, if you're watching the video, there's a green line going from one side of Saudi Arabia to the other. Is that functioning or is that in the works?
SPEAKER_00That both, both. They want to expand it. Yeah, they want to expand it, and there's your eventual solution. No longer will the world ever count on the Strait of Harmuz the way they have been for decades. And that's what's changed, and I don't blame them. Very so, but it takes time, it takes time to build pipelines, yes, uh less over there than it is in the United States.
SPEAKER_02It takes time to get electric in in northwest Indiana. Real quick, can I go back to that electric thing? I want to tell you something. Do you know why our electric is failing so bad here in northwest Indiana? The grid? Well, no, it's actually the trees that all these homes are in these beautiful neighborhoods with these giant trees. And I think the utility companies recently, last five, ten years, their budgets have been cut, and it cost a tremendous amount of money to constantly trim the trees. And the the vegetation growth around the power lines has outnumbered the amount of dollars spent to keep it, you know, trimmed up. And so also we had rain, we had more rain, we had rain, and these trees were heavy with moisture. And then when this wind came, these things were waterlogged like you've never seen.
SPEAKER_00So, folks, you know why that doesn't happen where I live?
SPEAKER_02You don't have big tall trees.
SPEAKER_00We have underground lines. When I moved from St. Louis area to here in the mid-70s, first thing I noticed was where's all the power lines? Yeah, they were built underground because of what you just said. That was pretty smart back then, wasn't it?
SPEAKER_02Yeah, yeah. But where we live in northwest Indiana is extremely, extremely industrial. If you go north of all these cities, there are some of the largest or once were largest steel mills in America. It just extremely think of the movie Rudy in that scene where Rudy and his brothers were playing in the neighborhood and his dad went to the steel mill. That's where it looks like, where I grew up a lot of houses real close to each other, those big power lines. You know, when people have their home in a garage and back and the power lines running in back, yeah. That's what it's like where I grew up in Griffith, Indiana, Gary, Indiana, Munster, Highland, Crown Point. But the newer cities, and in particular, my subdivision, are all utilities are under the ground. There's true. So we only went down for four hours, whereas I have friends and family who have been out for five, six days, and they say it could be up to another week. A true natural disaster here. But you know what? I feel blessed. I had Jim, I had eight extra people staying at my house, and I didn't mind one bit. It was like we celebrated Thanksgiving every single night. We all I went out and bought food. We cooked a ton of food, we invited friends, family, neighbors. Well, that was just that was without our four or five. We were sitting down tables at 12 or 14 here.
SPEAKER_00Cheaper by the dozen.
SPEAKER_02I was running a damn soup kitchen here, but that's okay. We're having fun. And that's you know what I said to my wife Gina? She's like, You haven't, you've been so cool through all this. I said, All I could think of is if the shoe was on the other foot, true, how would I like to be treated? You know, and so do on to others as you like to be treated. And uh let's get into fuel because that's a hundred.
SPEAKER_00This is the impact of this war. Brent was up five percent on the week and 34 on the year. That's Brent, that's the international crude oil price. WTI, it's the US price, and look at that was up uh 5.4 percent. So, what does that mean? Let's go to the next uh you know slide, Tommy. This is just retail gasoline is still near $4 a gallon. I think it's gonna stay there for a while. Diesel, again, average is near five dollars and 40 cents, about $7 out in California, by the way. They're both records for the date for gasoline and diesel. That's not good for Republicans going into the November 3rd elections. Fertilizer, again, we import five of the 12 million tons of urea that we use, and we import nearly 20 of the 22 million tons of ammonia, and we import six of more than 8 million tons of phosphate. That's all you need to know of why fertilizer prices are going to be firm if not higher, Tommy, in the months ahead. As we go into harvest.
SPEAKER_02Can I add some color that I learned from you and Davis capacity capacity utilization that like we are we can't make any any faster, I'm trying to say. That's what I'm trying to say.
SPEAKER_00Yeah, we're at almost peak capacity, you know, utilization efficiency.
SPEAKER_0297 something, but it don't go to 100, Jim.
SPEAKER_00Well, sometimes it can, but it's a quirk of the numbers on that. But but sometimes plants have to shut down for maintenance. So yeah, we're we're doing about as much as you can. And you know, it could be worse. Uh I'll compliment uh Trump's policy on this one. Okay, look at what it had been had it not been for burn baby burn, you know, or what whatever he drill baby drill. Drill baby drill.
SPEAKER_02What about Venezuela?
SPEAKER_00We would be a lot higher, and Venezuela has helped. So it it you know, it could be worse. You know, it could be worse.
SPEAKER_02Can we give a shout out to former governor of North Dakota, Doug Bergum? That boy understands oil and energy, you know.
SPEAKER_00He does. He knows permitting how to accelerate it, both at the state level and at the federal level. He knows and believes that he has a president who believes, by the way, in investment in technology. And and look at the shale uh that we went through and and all that. Thank goodness that we you know developed those elements because it's helping out now. And we're slowly building, improving our electrical grid. Yeah, there's Doug Bergum, good guy. He he knows energy. He knows energy.
SPEAKER_02I've met him several times. He's he's very easy to talk to, very educated, very educated. Do you know how Doug Bergum and his family made all his money?
SPEAKER_00A software company sold?
SPEAKER_02Doggone it. Can't you at least pretend to let me one up you? God, Jim, it's Sunday. Yeah, well, they also own grain elevators. They also own Arthur Grain Companies in North Dakota, very successful good grain company. A lot of my producers sell them grain and they're expanding.
SPEAKER_00I did not know that.
SPEAKER_02Yeah, Arthur Grain. We also know some other people who you'll be seeing some interesting things happen. But I'll tell you, Doug Bergum understands energy. Interesting thing, when he ran for president, he had like 1% of the vote. And you're like, why the hell is he doing this? You know, well, now, you know, if you can get your name on the ballot and no one knows who you are, they all of a sudden know who you are. And you get to show up to a couple of debates in Iowa, and then lo and behold, you get a pretty cool job that he is extremely qualified for. Doug Bergham, Secretary of the Interior, he's been an effective cabinet member, and you need him. A trusted one, too. Trump trusts him, and that's very important in that Trump circle, anyway. Okay, so we talk oil, we talk fuel, we can't talk all that stuff without this next slide. I think it's transportation. Do tell.
SPEAKER_00Yeah, we had two transportation issues. Last week we talked about the likelihood that they would extend the Jones Act waiver. They did. In fact, they extended
Jones Act Waiver And Rail Merger
SPEAKER_00it 90 days. I thought maybe they might go 60, but rather than extend it a lower number of days, they put some stipulations on it. And I don't want to get too detailed on that, but let's just say agriculture came out ahead because that still gets the waiver. Has it meant much on the price of the fuel? Not much, but that wasn't the key. It's helping move products, and that includes fertilizer. Once we get it over here, Tommy, that if a U.S. flag vessel, which is usually much higher priced, cannot be found, you waive the Jones Act waiver, which says interest state shipments has to be on U.S. flag vessels. So that's a good thing. It'll continue for 90 more days through harvest. The second one is National Grain and Feed Association Thursday, I think it was Thursday, yeah, late Thursday, came out against the big uh rail merger. Now, as I said before, that's not the kiss of death, but boy, that's a big hit on the proposed merger. Because basically, the a lot, not all, but a lot of people in the ag industry, you know, uh, they're just leery uh about this because they remember in the ag industry the scars of the 2022 rail system meltdown because there because of the it was a breakdown uh the the uh rail system as a whole that that just didn't deliver right. And there are six class ones today, Tommy, in the railroad railway industry. It is a single integrated national, really North American system now. So if you pull on one string like rail, you're gonna impact them all, and that's why the ag sector to a large degree is against this uh big merger, and that's basically what their statement was when they came out with it.
SPEAKER_02Oh, very interesting. All right, we're getting towards the end here. U.S. China, every week we talk about US China. What's going on here?
SPEAKER_00We still need an official announcement. I I was surprised when somebody asked me, they go, has
China Soybean Demand And Summit Watch
SPEAKER_00the White House ever officially put out a statement of the dates and the the timelines? And they haven't. Now, I'm not saying it's not going to happen. September 24th has been the rumored date. So, but there haven't been many talks between US and Chinese officials about the summer about the summit, what we call deliverables, Tommy. And agriculture has a big say in that one because the next positive move on US-China relations is going to be this summit and the talks before and during and after relative to tariff reductions. So we're gonna see. I think those will happen. I'm not negative on the events, but I still want to see a little more proof. China, if you'll recall this past week, USDA almost daily, not every day, but they announced a U.S. soybean sale to China. So it's starting to add up. That's another reason why I think soybeans didn't get the hit they could have following the uh USDA crop production report. China's coming in as a consumptive buyer. And this coming week, China's gonna have another auction, Tommy, of uh for for their uh uh uh soybean stocks in inventory. They're clearing out the bins, if you will, for what looks to be continued relatively large purchases of U.S. soybeans between now and the end of the year. That's a good thing.
SPEAKER_02Tyson, this is we should probably keyed off with this one, but that's all right, we'll get to it now. Tyson Foods closes a plant. Jim Friday, I had a map. Let's let me pull up the map. I pulled this up. Can can you see these
Tyson Closures And Beef Restructuring
SPEAKER_02stars on the map, Jim?
SPEAKER_00Yes, I can.
SPEAKER_02Okay, so that red star in on right by Quad City over there in Illinois, that one's uh officially closed.
SPEAKER_00Yeah, let's just look through since January. Remember when Tyson shot the Lexington, Nebraska plant in January, and they cut the second shift at Amarillo at the same time. And then this past week they ended harvest at Jocelyn, Illinois, Caput, no more, on August the 13th, and they closed the Eagle Mountain, Utah.
SPEAKER_02That's way up uh up yonder.
SPEAKER_00Yeah, and they listed Pasco, Washington for sale. Now, let's connect the dots here.
SPEAKER_02That's a lot of house cleaning there, Jack.
SPEAKER_00That's roughly 10,400 head per day of capacity in eight months. Now you'll recall JBS ended the harvest at Sutterton, Pennsylvania on August 14th, but they reversed the course on August the 10th, preserving about 400 uh jobs in value added work. Now Tyson's beef segment is losing operating loss about uh $600 million for fiscal year 2026 against a $3.24 billion profit in fiscal year 2021. So they had an economic reason to do what they uh did. Packer margins ran near negative $310 per head through mid-summer. So they were heaving money. Yeah. There's not a shortage, there is a shortage of cattle, uh, not a flight from regulations on on this one.
SPEAKER_02So we have that color though that they do have the hoof capacity to kill to make up for the seven, eight, nine thousand that they've cut. It's just in different areas, correct?
SPEAKER_00Absolutely, and that tells you everything you need to know. I can't remember the places what well let's just say Amarillo, Amarillo, other places.
SPEAKER_02Dodge Dakota City for sure.
SPEAKER_00Absolutely. That tells you all you need to know because they think that they still have the capacity to handle all these animals. You know, that tells you how much you know, overcapacity at the current time there is. Now, that doesn't realize the hurt that the Pacific Northwest is going to feel if within 90 days, I think Tyson said 90 days, they're hopefully get a buyer. The Pasco Washington plan. That's a lot of animals that were up. I think what was it, 2300 at a day?
SPEAKER_02Yeah. Yeah. What about the Cargill strike? Tie that into if they come back online.
SPEAKER_00You know, oh, I think they will eventually come back, but I'm gonna have to look that up to my sources tomorrow morning to see where we at or where we at on that. You know, I I'm working on a special report that'll either be out later today or tomorrow with the headline Is America outsourcing its cattle herd?
SPEAKER_02Hold on now. Full screen. Record imports one more time.
SPEAKER_00It'll make America outsourcing its cattle herd. Why do I say that? Record imports, foreign owned packers, and a dismantled tariff wall have made import dependence structural. But the offshoring is happening in the grinding beef complex, not the feed yard. So I'll give you my conclusion. I don't think we're outsourcing our cattle herd. It's hard to move our cattle yards to Brazil. Okay. But there are structural changes going on in the beef industry. And Tyson is a clear example of what's been happening. But I've got details and quotes and everything coming out in a special report because that's what good traders were asking me about. And I live through what traders and analysts and farmers asked me to check out. And that was a good, a good question by a veteran trader who asked me to check that out.
SPEAKER_02And folks, you can catch that on AgBull.com and uh make sure you're getting Jim stuff. Sign up over here. Stay in touch with us. Go and see if you're on Jim's list, just stay stay there. You'll be fine. But if you're not on Jim's list, we'd love to have you. Of course, we at AgBull still have our premium service, $25 a month, $250 annually. We'd love to see on the subscriber side as we've hinted, noted, and everything else. Jim is moving to subscription-based service here in the next few months. He is officially, because he has a shirt, officially on the uh AgBull team. Let's uh talk about Jim real quick for just a second before we get to last slide. This is one year we've done the show, August, you know, 5th, 10th, 15th. Boy, I've learned a lot from you, and I thank you. I'm I've learned from you too.
SPEAKER_00Yeah, it's been mutual. Been mutual. I love your trading mentality. You know there's risk in buying and selling. And as long as you know what the risk is on each side, then the listener or the reader, whatever the case may be, can choose their own after we hopefully give them the perspective and connecting dots that they need. We can't overtly, you can, but I don't uh tell them when to uh buy and sell. But uh I like to give them facts, figures, and perspective. And that's what we're all about.
SPEAKER_02Yeah, it's a good combination. I was telling my mother-in-law, she said, What's Jim an expert on? I said, I believe Jim's been in covering DC, both on the political, but in particular agricultural politics, the business of agriculture for over 50 years. What go through, just brag a little, go through your history of doing this. Where'd you start? Go, we got time.
SPEAKER_00I started a don't ag service in St. Louis. My first mentor there, Wayne Ritchie, was the one who pressed me the most. I've said before at his funeral, I said
Mentors Editing And Connecting Dots
SPEAKER_00he was the only SOB I've ever loved. He pushed me, and all the rules that he gave me came out into play. That I always think of what would Wayne tell me to do. Then I went into uh Merrill Oster's group, Pro Farmer, in the early days of ProFarmer. And Merrill, as both a journalist and a trader, a big hawk producer. So he knew both corn as a feed and corn as a producer. And he let us go. He gave us all the rope we needed to write. And so, but he also taught me markets more. And he said, You could teach markets, but you can't teach people how to write. So that was interesting. Merrill was such a good mentor. Then, all throughout my my uh long career, Willard Sparks of Sparks Companies was a uh a key mentor, and he was probably the smartest. You're up there, Tommy, but he was probably the smartest person I ever known in agriculture. He was just uh the multimillionaire, but the nicest person you want to meet. He was uh again up new cattle and cotton, and he's originally from Oklahoma. He was big, of course, in Tennessee, being in Memphis, Memphis Parks, yeah. But he knew it all. He taught me connecting the dots. He would always start his meetings with transportation, by the way. What was the basis saying? He always would say basis talks because if you're tightening basis, that means demand's coming up, and he was good on around the world stuff to give it perspective of the ability of countries. Do they have the ability to purchase? So, and but those were my mentors. You all have to have mentors, you know, and you should be a mentor as well in your life. I totally am a believer on that. So you are what you were trained to do, and that's what I think is lacking in many cases right now, that people don't take the time to mentor. And I think that's what's wrong, not all, but in many of the news organizations, Tommy, to tell you the truth. I don't think there's an adequate number of editors, not the reporters. A good reporter always needs an even better editor to make a story better. And that's what I had growing up in a wire service and things like that. I had good, I hate to call them bosses, associates, and because they made my copy better. And then I learned from well, why did they do it that way? And and things like that. I don't what headline did they use? I think that's lacking in a big degree right now because probably cost. People don't want to spend the money for experience anymore. They think certain companies think that they can hire off the street for a lot cheaper in order to write agricultural copy, and that's where they're falling down right now, and that's why we're going to continue to gray more grow more than they are, because they've made strategic mistakes in that regard. They're losing experienced people, period.
SPEAKER_02Yeah, good, good chat. I like that. Okay, let's get to we just one is actually a positive.
SPEAKER_00Can you believe it? Screwworm. The number of cases are relatively stabilizing. We haven't had that many new cases. That's a good thing. We coming up here on August the 24th. That's a lot.
Screwworm Update Border Reopening
SPEAKER_00Next Monday. Next Monday is the phased reopening of the border. Douglas, Arizona reopens, and then phase two is going to be contingent on how the Douglas outcome uh works out. So, but it's going to take months in order to really factor in the significance. But in my coming report, Tommy, on the structure of the of the beef market, have we unleashed a big uh long-term element in Mexico where they're building their own livestock feeding industry? That's it's a serious question that I think uh is going to come back to haunt us. Mexico's meat chamber has said openly that it aims to double beef exports to the United States. So two years of closed border did not idle a million Mexican calves, did it?
SPEAKER_02No, they went somewhere.
SPEAKER_00It capitalized a Mexican feeding and slaughter industry that now has every reason to keep the value-added steps south of the Rio Grande and ship boxes of beef instead of calves to the United States.
SPEAKER_02Yeah. Can you connect the dots with this handsome alert right here? Every morning for paid subscribers, we send before the bell with Mike Sands. Mike Sands worked with you under that Sparks era of Wees Meyer Sands, Richard Crow, that whole group, right?
SPEAKER_00Oh, yes. And Mike has the very good communicator, booming voice, which I have wish I had. But and and he knows the looks. Yeah, he he breathes the meat markets. I mean, he can flip a uh a number out. He makes numbers come alive, Mike does. He's a very multi-decade uh uh contact, and I I like the way he thinks. He reasons things out, he connects the dots in the livestock and meat industry.
SPEAKER_02Unemotionally, too. Get that word in there because he's not all drama. He's the same every single damn day. You can count on it's almost like he's crabby, but he's not. He's just that that's just Mike. I love him. But uh, yeah, he's good stuff. All right, we're at the end, and I think the stage is yours. I think we got through all the slides.
SPEAKER_00Yeah, we did, we did, and we're on time. Yeah, well, the good news was the once the screw warm, but we're going to see continued.
Demand Pull Signals And Final Takeaways
SPEAKER_00It looks like we made the lows in the corn and beans in late June. The charts are clearly signaling that. That doesn't mean rocket move up, but this crop that you're gonna see in the ProFarmer Crop Tour is probably gonna look better than it actually is. So we're gonna take September and uh further reports to really get into the size of the crop. But the positive side is your users are, I don't think, are no longer gonna wait now. They've seen enough and they're gonna accelerate their purchases. So watch your export uh sales, watch your meat export commitment, not meat, grain export commitments now. I think that they're going to accelerate. And that's all the ingredients of a demand pull market that we talked about earlier. That's positive news if you're on the producer side.
SPEAKER_02Thanks, Jim. I'll see you real soon. And by the way, that shirt looks good on you.
SPEAKER_00I like it. I like it. Nice to be part of the team.
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