Grains closed today at regular time and will not reopen until Friday morning at 8:30 a.m. CDT.

The corn and soybean markets are showing some signs of strength this morning, while wheat seems more influenced by spread action ahead of delivery than anything. The front month is trying to trade higher, but weakness is seen from March forward. Crude is a touch stronger, while the dollar is lower. After withstanding significant pressure from wheat and soybeans over the last couple of weeks, corn led the way lower yesterday. Driven by a combination of farmers having to pull the trigger on pricing or rolling decisions versus the December contract and worries over possible retaliation from Mexico if Trump were to go through with his plan of 25% tariffs, the market closed 5 cents lower on the day. The debate for much of yesterday was over what to expect next regarding possible tariffs and trade disputes. The proposed 10% tariff against Chinese goods until they do something to combat the flow of fentanyl was seen as better than expected by some, as the talk had been of 60% tariffs during the campaign.

A 25% tariff on Canada and Mexico was seen as more concerning, considering the depth of trade between both countries and the US. While Canadian officials were quick to say they would look to negotiate and work with Trump, Mexico’s new president, Claudia Sheinbaum, responded sternly, threatening to retaliate to any tariff imposed by Trump on Mexico with one in kind. The dynamic between Sheinbaum and Trump will be one to watch as they are on very different ends of the political spectrum, with Sheinbaum being more left in her thoughts than Nacy Pelosi.

With the purchases of corn by Mexico up substantially last year versus the five-year average and then up again this year, traders are concerned we could see a disruption to Mexico’s purchases in the future. However, even with a tariff, Mexico would have difficulty sourcing alternatives as world supplies are relatively tight until the South American harvest in the April/May/June time frame. With much of the tariff threat tied to action items, i.e., working to slow the flow of immigrants across the border and cracking down on drug trafficking, and with two months to negotiate, it is very likely we should see some resolution.

US corn remains the cheapest delivered into Asia, trading some 25 cents cheaper than other offers and capturing tender business this week. The current cash price for corn in the export market has long been seen as a relative bargain, likely to keep buyers engaged over the next few months. The cash market for wheat is a bit more mixed, with limited demand for physical supplies ahead of the holiday. However, we could see a much tighter pipeline after the first of the year as Black Sea supplies dry up and harvest pressure eases in the Southern Hemisphere.

Wheat prices are struggling now with Argentina FOB wheat offers at $213/MT amid nearby lackluster world demand. Egypt has slowed their return for tenders until early 2025 wheat needs. Russian wheat bid is at $226/MT FOB.

The markets will close at normal time today at 1:20 central time this afternoon but will not reopen until Friday morning at 8:30 to observe Thanksgiving. On Friday, the trade will close at 12:05.

Again, yesterday, feeder cattle were in the limelight in trade as the market reacted to a possible 25% tariff on Cas from Mexico. Of course, this will not occur until January 20, with the screwworm halting exports that should likely end before December. The negotiated fed cattle trade was quiet, with small numbers reported in Iowa at $295.50, $1-2 higher than last week. Asking prices in the South are quoted at $189, $3 higher than last week. December cattle futures are pricing in a steady trade. Resistance at 190 was tested this week on the February contract and held. It will likely take the cash trade pushing through that multi-month barrier to drive the board higher.