Host Cody Koster and Jon Spainhour take a deep dive into this week’s GDT report.

Questions or comments? Contact Jon at [email protected], Cody at [email protected], or give us a call at (312) 492-4200.

(Transcript auto-generated)

00;00;00;10 – 00;00;08;18

Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities.

00;00;08;20 – 00;00;10;23

Hello everybody. Welcome back to.

00;00;10;23 – 00;00;17;05

Another Game Tuesday. I’m your host, Cody Koster, with me from Chicago, Mr. John Spain, our John, how are you today? Besides. Cool.

00;00;17;05 – 00;00;29;01

I’m doing very well. Cody. It is cold here, but I want you to know that we here in the Chicago office are here. And we braved negative eight degree weather to be here this morning for the GTI.

00;00;29;05 – 00;00;30;18

Risking it for the biscuit.

00;00;30;18 – 00;00;33;14

Standing there waiting for that bus was pretty cold this morning.

00;00;33;16 – 00;00;38;18

Yeah, well, soon it should pass here. In a few days we can get back to some normal January temperatures.

00;00;38;18 – 00;00;40;00

Hopefully looking forward to it.

00;00;40;06 – 00;00;47;28

Unlike the weather being down, our global dairy trade today was actually up 2.9% as a as a whole, as an aggregate.

00;00;47;28 – 00;00;51;11

I really like the way you did that. Cody, thank you for that segue. It was wonderful.

00;00;51;11 – 00;01;09;20

So as an aggregate, we’re up 2.9%. And as you were putting out this morning, just kind of how the auction was going, one that stuck out into my mind, whole milk powder actually ended up 4.8% higher in kind of look like the belle of the ball until and hydrous milk fat came out and sunk just a little bit lower on that side.

00;01;09;22 – 00;01;35;04

You know, it was a pretty weird auction. There was just a lot of different things that were pretty funky. First of all, I’ll say that we saw right out of the gate relatively strong demand numbers, right? I think we started out in butter, cheese and whole milk powder with a 3.5 demand factor, which is, you know, really strong, especially in whole milk powder to see, supply demand ratio that high.

00;01;35;05 – 00;01;53;24

So that was pretty funky. And at the same point in time, we came out with AMF at a very, very low demand factor of like 1.5 on the opening skim only at two. So, you know, a lot of the times if there’s demand in one product, we see, especially Homer Powder, there’s demand in all the products, right. Or vice versa.

00;01;53;24 – 00;02;01;13

And this one, our supply demand ratios were just all over the place. And it really caused mixed results across the board.

00;02;01;17 – 00;02;20;24

I think the mixed results that you’re talking about definitely came on the powder side, but also on the cheese side. And I know we’ve talked about before where cheddar comes out higher, mozzarella maybe a little bit lower too. We can’t really equate our prices to what they have going on over there. But mozzarella definitely trading today ended up 0.3% lower from the last auction.

00;02;21;01 – 00;02;54;21

March was down 0.3. Cheddar was up 2.5. You know, a little bit of a divergence between the two there and both of those prices now being higher than the US price. But cheddar was definitely the strongest of the two cheeses. Where I think we really saw strength though was in whole milk powder, as you noted, up 4.8. And I would just point out that when it comes to expectations, I would say that Homer Powder came in maybe slightly higher than where the futures were looking.

00;02;54;23 – 00;03;16;10

It was looking for a price move higher here and we got it. If we were to say, what is one of the things that caused that price to move this much higher, and why did people expect it to? One is that on this past Friday, we saw New Zealanders cut the offers of whole milk powder and skim milk powder that would be for sale on the auction, a pretty decent number.

00;03;16;13 – 00;03;47;28

And what happened is, you know, you’ve decrease the amount of product that’s for sale on the GDP. So you shorten the supply line. Prices start to go up here. Then one of the reasons that the New Zealanders said, hey, we’re going to do this is they’re saying they have fairly decent off GDP demand. So whole milk powder up 4.8%, I would say back in line with where we were prior to the last auction, just slightly higher than three auctions ago and December 3rd.

00;03;47;28 – 00;04;11;18

And then in the first auction of January, we saw declines and then we saw this one bounce back up to new recent highs. You know, you look at that and you say boy that is strong. And that is a good signal that followed through into butter. We saw the butter price here today go up 2.5% up to about $3.17 a pound.

00;04;11;18 – 00;04;36;26

Great sign on the other hand, here’s where things get really weird AMF anhydrous milk fat, which has a lot more butter fat in it than butter itself, was down 7.7% and it came in at $3 a pound. You just saw butter, which has less fat in it. Take a pretty decent premium to AMF, which has a lot more fat, and we don’t normally see that.

00;04;36;26 – 00;04;56;14

And again, that’s just something that really stands out here. And then finally I’ll go to skim milk powder. Skim milk powder was up 1.8%. Came to $1.24, kind of in line with where the pulse was suggesting. But here in the last few days, since Friday, I guess we saw the futures start to move higher on the GDP skim milk powder.

00;04;56;14 – 00;05;19;18

And again, I think it was because of the decrease in volumes that were on offer. So we were expecting to see things go significantly higher. And we only got a 1.8% lower or 1.8% higher. And I just say that because it appears as though the SNP result is really going to disappear versus the expectations coming out of the futures.

00;05;19;24 – 00;05;45;20

Again, pulse was kind of in line there, give or take, here or there, but it’s really the the futures that had much higher expectation in mind than what we got today. And I think that’s going to be seen as a disappointment. I would also point out that shortly after the auction or while the auction was going on, really, we started to see our nonfat dry milk futures start to move lower some into new recent contract lows.

00;05;45;20 – 00;06;01;06

And today’s spot market responds by moving lower and now sits at one 3475, which is the lowest price we’ve been at since October when bird flu really started to take hold here in our nonfat market.

00;06;01;08 – 00;06;22;04

And I think looking at how our market responded, because a lot of people look and say, well, GDP was higher, they’ve got some of the higher prices in the world. Ours should follow along. And it just doesn’t always correlate 1 to 1. Kind of like you mentioned the AMF and butter. They don’t always move to 1 to 1, but usually when one is higher, like butter is a point higher, AMF will kind of follow along.

00;06;22;04 – 00;06;34;07

We haven’t seen this kind of discrepancy in those two markets in a long time. I’m looking back at a few auctions and I don’t see one recently where we had AMF. That low and butter rise like that and create that kind of wide band there.

00;06;34;07 – 00;06;59;28

We very rarely see this. And, you know, I think it probably speaks to the fact that AMF has a very particular type of customer, a confectionery customer or an ingredients customer, whereas butter can have a totally different kind of customer. Right? My sense is, is that after this result, you’re going to see some adjustments on the volumes where they’re going to make less AMF and they’re going to make more butter.

00;07;00;02 – 00;07;17;14

Trying to bring those two back in balance. It does highlight a couple other subject matters that I’d like to focus on real quick, if you don’t mind. And please understand, dear listener, this is me going out on a bit of a limb here, but we are entering a period where things can get a little weird and a little wonky.

00;07;17;14 – 00;07;38;23

And I know that’s a highly technical term there, but there are two things that really stand out. One is that we are entering, and I say this from an apolitical perspective. We are entering a period where we’re going to have a lot of tariffs and trade wars, and that has an effect on different regions, products and what can be brought into certain regions and what cannot be brought into certain regions.

00;07;38;23 – 00;08;00;16

It can cause a buyer to say, well, if I can’t buy it from this one region without a tariff, maybe I’ll go to this other region. And that causes prices to really fluctuate. Just out of those tariffs, I would say we are preparing to enter that type of period. But this morning I woke up and it says, you know, there are 25% tariffs planned on Canada and Mexico in two weeks.

00;08;00;16 – 00;08;18;14

I can’t stand here and tell you right now that I understand exactly how that’s going to play out. But I do just want to say that it’s going to do funky things to markets, and sometimes it takes a little bit of time to parse out, you know, what’s affecting what I think that might have a little bit to do with the action that we saw here.

00;08;18;14 – 00;08;51;15

Another point I want to bring is that there was foot and mouth disease found in a water buffalo in Europe a week and a half ago. I think the Europeans are acting very responsibly, and it is pretty incredible to see the mechanism and the scheme they have designed to isolate this case, and to try for it to have as little effect on the markets as possible and at the same point in time will be in there are countries that are going to say, I can’t take product from Germany because of this.

00;08;51;15 – 00;09;14;25

It’s just written into their import codes. I bring that up to say that can really cause things to get weird, especially because the way the Europeans have done this, they’ve isolated a part of Germany and has said no product leaving this area, you know, or a product that’s manufactured in the specific area, you know, we’re isolating it. But then some of the stuff in Germany can be traded into the Netherlands.

00;09;14;25 – 00;09;38;21

Right. And the Netherlands say, well, you know, we can export that stuff. We can export our own stuff and we’ll use the German stuff. I don’t know exactly how it’ll play out, but it does seem to scramble markets, especially as people try to figure out what is going to happen and how it’s going to happen. We could wake up tomorrow and somebody says it was a false positive, and we could also wake up tomorrow and somebody would say, we found 3 or 4 more cases.

00;09;38;21 – 00;09;47;29

I simply don’t know that what I do know, though, is that it can really discombobulated markets and make regional prices do bizarre things.

00;09;47;29 – 00;10;06;02

I think you make a great point there, John, between the foot and mouth disease and the tariffs that were announced that are not supposed to go on for two weeks, I mean, kind of like you mentioned with that, we could wake up in a week and they’ve got a deal done where the tariffs possibly don’t go on. And what that creates in our market, just like we saw last week, was the volatility and the unrest, I guess.

00;10;06;02 – 00;10;11;12

And now you’re kind of seeing it on the global dairy trade, the same kind of way that we’ve been watching it in our markets.

00;10;11;18 – 00;10;30;20

Another point to that is that a lot of people were saying part of the rally that we saw in December and in January in some of our markets here in the US, have been people pulling you know, and trying to get product across the border as quickly as possible before tariffs do. Come on. It is just hard to know how much of that really happened.

00;10;30;20 – 00;10;53;04

But what I can say is, is that China has definitely been somebody that is in the crosshairs of this potential trade war, and as of right now, there isn’t going to be any tariffs on there. Again, it’s hard from a timing standpoint to understand it. But December imports into China were pretty strong. So it’s one of those deals where I admittedly will say it is a very complicated subject matter is hard to understand.

00;10;53;04 – 00;11;12;29

The yin and the yang and understanding where you put pressure over here, and it’s going to cause a reaction over there. If I were to go back in time to, you know, eight years ago, I remember it being a relatively confusing time and seeing regional price discrepancies because of these types of terror. So I just want to bring that up, and it’s something that we’ll have our eye on.

00;11;13;04 – 00;11;18;03

We will do our best to understand it, but understand that things can change pretty darn quickly.

00;11;18;05 – 00;11;38;21

Absolutely. Well done. We appreciate you diving into the global dairy trade today. Our next one is actually going to be in two weeks beginning part of February. But until then, everyone, we appreciate you tuning in and listening. If you have any questions, please don’t be afraid to email and let us know. But until then, have a great week and even better weekends and we will see you next time on the GT podcast.

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Free download: https://filmmusic.io/song/9520-funky-intro-29

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© Ever.Ag 2023, confidential and proprietary.

This episode is also available on the following
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Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The post GDT Review with Jon Spainhour – January 21, 2025 appeared first on .

View the video version of this episode here.

In The Grain Feed, Jim Matthews is joined by a rotating cast of analysts to discuss what dairy and livestock producers can be doing to manage their risk. This week, Jim is joined by Phil Plourd, Ryan Yonkman and Jake Kingsley at the annual UDA meeting in Tempe, AZ.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

The following music was used for this media project:
Music: Funky Intro 29 by TaigaSoundProd
Free download: https://filmmusic.io/song/9520-funky-intro-29
License (CC BY 4.0): https://filmmusic.io/standard-license
Artist website: https://linktr.ee/taigasoundprod
© Ever.Ag 2024, confidential and proprietary.

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

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In this week’s Parlor to Plate dairy podcast from Ever.Ag Insights, our expert panel dive into the most important things right now in dairy and grain markets. How will President-elect Trump’s inauguration and potential trade policies impact grain markets? What can we expect from the upcoming December USDA Milk Production report, and how might California’s dairy output rebound after challenges in late 2024?

Join host Kathleen Wolfley and panelists Britt O’Connell, Kevin Peterson, and Tiffany LaMendola for a spirited discussion.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

(Transcript auto-generated)

00;00;00;00 – 00;00;20;26

Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities. Hello and welcome to Parlor to Plate a weekly podcast from Average Insights, dedicated to offering listeners enlightening discussion and actionable intelligence about dairy markets. I’m your host, Kathleen Wooly.

00;00;20;27 – 00;00;42;05

We are excited to have you along. If you like what you hear, please like us! Subscribe and tell a friend or two to timestamp today’s recording. It is Wednesday, January 15th, around 1030 Central Time. Here’s a quick rundown of the markets. CME Block Cheddar closed at $1.90, down $0.02 from last Tuesday. Barrels finished at $1.87 a penny higher.

00;00;42;06 – 00;01;08;08

Spot butter at 258, a half cent lower on the week. And the nonfat milk market finished at $1.37, mostly unchanged. And now for the grain markets. March corn is trading at 478 per bushel. March soybean sitting around 1048 per bushel. And the March soybean meal contract is trading near 303 per ton. It’s a new week and yet another star studded panel from the ever AG financial services team.

00;01;08;08 – 00;01;26;16

From our green team in Platteville. We have Brett O’Connell from our commercial division in Chicago, Kevin Peterson. And last but not least, Tiffany Lum and Ola from our producer team. Guys, thanks for joining me today. Thanks for having us. Before we get started, I got to tell you, I’m stuck in a bit of a rut. I really need some new music suggestions.

00;01;26;16 – 00;01;47;04

So as we start the new year, what are you guys listening to? Well, my husband just got us tickets to go see Cody Jinks in the summer, so that’s been on our playlist lately. Nice, nice. What about you, Kevin? I’m a hip hop and rap guy myself, so typically Jay Cole for me. All right, how about you?

00;01;47;07 – 00;02;11;05

You know, Kathleen, music’s really not my thing. I’m much more in podcasts, so I’ve been Parler to play all the time. 20, 25. It’s a really good recommendation. So, listeners, you’re already here again. Like us. Subscribe and tell a friend or two. That’s Brit’s recommendation. Well, guys, let’s get started for today. I want to know what is the most important thing right now.

00;02;11;06 – 00;02;41;09

Brit, let’s start with you. You know, I think after the last report that came out last Friday, which was an absolute zinger, USDA took corn yield for the 24 crop down by 3.8 bushels to the acre. Totally a big surprise and shock to the market. But there’s a lot going on in the grain markets. So the thing that’s going to be most relevant in the short term here is what is President Trump, when he becomes inaugurated on Monday, say there is a lot of speculation around how is trade and tariffs going to be handled as it relates to grains.

00;02;41;09 – 00;03;04;17

And so I think most immediately, that’s what the market is going to be paying attention to. I think just secondary to that, it’s going to be Argentinian, whether they’re moving in some of those critical phases of their crop growth, and they’re dry down there. And so with rains in the two week forecast that the market is going to be watching to see if those come to fruition and or underperform expectations.

00;03;04;17 – 00;03;23;00

So I think those are the things right now that the grain markets are watching. But if we thought 2025 was going to be a quiet year in the grain markets, that was all upended on Friday and things are going to be exciting as it relates to president elect Trump and the potential for tariffs. Do you think that any of this is baked into the markets already?

00;03;23;01 – 00;03;43;11

You know, I think to an extent it is. But I think markets never like uncertainty. And so I think with certainty is going to give the market a bit of a license to make a directional move that’s more assertive than what it’s been able to make. We’ve seen March corn really hold the line here at 480, which is our 100 day moving average.

00;03;43;11 – 00;04;08;17

And if we break through to the top side of that probably means, you know, five and maybe even going to test that. 550 territory that we certainly haven’t seen for a while in A15 balance sheet could justify a move like that. But I don’t know that the market has necessarily fully baked that in. I’d even go as far as to say, you know, I think, well, right now it feels like it’s got a far more bearish element to it.

00;04;08;17 – 00;04;27;10

I think long term this could be friendly or for U.S. commodities, no different than coming out of the trade War of 18. And then as we moved into 20 and China started trying to make good on the phase one trade agreement. So we’ll see. There’s going to be a lot of elements that we have to watch here to this.

00;04;27;11 – 00;04;45;23

Thanks, Brett. Tiffany, how about on the dairy side of things. Maybe ahead of myself a little bit here by a week. But it’s been the center of all of my conversations lately. So I’m going to have to go with milk production. We will get the December milk production report next Friday, the 24th. The US was starting to post some gains.

00;04;45;23 – 00;05;09;02

We had about three months of small year over year gains until November came and my home state got hit especially hard with bird flu. California, down 9.2%, really pulled that US number down into a negative one. But if you had set California aside, the US would have been up again 0.8. So I think a lot hinges on, you know, performance out of California again in December.

00;05;09;02 – 00;05;29;24

My eyes are going to be on, you know, do we continue to see growth in some of those areas like Texas, Kansas, South Dakota, areas of new plant capacity, growth coming? And I think in particular, cow numbers two, we were starting to kind of rebuild the herd. And so we seemed like we were setting a runway for stronger milk production growth this year.

00;05;29;24 – 00;05;49;28

So that is a highly anticipated report. And I think we’re all very curious on how things will land. Thinking about that runway for growth. Tiffany, what’s your sense of pretty sure margins today? Yeah. Well, as Brett just noted, last Friday took the wind out of the dairy producer sales a little bit. I mean, it was really feeling like the costs were finally coming their way.

00;05;49;28 – 00;06;06;22

And that might be one less thing to worry about shortly. Run back up in Warren. I mean, I was looking at the numbers yesterday. I guess you could kind of say a one for $1 for dollar, or the 75 cent move or bushel of corn. My rough math was saying that added about $0.50 100 weight. So their cost of production.

00;06;06;22 – 00;06;25;19

So you know, it’s not nothing and that’s just corn. So I think that is a bit of a bummer. So now it certainly hinges on kind of what these milk prices do. Last three has been very volatile here lately for seems to be hanging in there. So I think there was definitely some optimism building. I don’t know that we burst that bubble totally, but we’re enough to keep a close eye on it.

00;06;25;23 – 00;06;43;23

Thanks, Stephanie. Kevin, how about from your perspective, what’s the most important thing right now? Yeah, I think to piggyback on what Tiffany is saying. I mean, I really do think it is that no question for next year. I mean, obviously with this new capacity that has come online and is, you know, the other massive plant is set to come online here within the next month or two.

00;06;43;23 – 00;07;04;20

I mean, it’s really can they get the milk to make the cheese. And then on top of that, you know, let’s say they do. What are we going to do with that excess cheese? I mean we have been running a little low in production last year in terms of cheddar. So if we can make some more cheddar with the new plant in the middle of the United States, are we going to be able to export any excess?

00;07;04;20 – 00;07;22;23

And I think to Fritz point about Trump is when we start talking about trade wars, kind of where does that put us there, especially with a trade partner like Mexico who is, you know, extremely strong in taking cheese from the US. So I think that’s something to look at. Know Canada is also another good trade partner is just right here.

00;07;22;23 – 00;07;40;11

I’m just speaking of close ones. I know Trudeau is stepping down and it sounds like, you know, maybe the conservatives might have the better position in their next election. So maybe that helps things go a little more smoothly there. And then when we talk about Europe and the rest of the world, you know, especially on cheese, we definitely have the upper hand right now.

00;07;40;11 – 00;08;00;24

But it’s still going to be try to book those deals, you know, long term. So I would say, you know, that’s kind of what I’m looking at there. But I do have a question for Tiffany. You know, all summer prices have been really good, especially on that class three side name in class four. But you know, hearing still continued beef on dairy and really not raising those heifers.

00;08;00;24 – 00;08;20;09

So where do we think that puts us next year in terms of milk growth? Hearing a lot of new build dairies coming on line for these facilities. But I still just wonder again with high margins. Well, a lot of what I’m hearing is operations are still beefing those with grade cattle prices and stuff. So where do we think that kind of puts us in 2025 in that situation?

00;08;20;15 – 00;08;38;01

Yeah, that trend doesn’t seem to be stopping anytime soon given the dynamics and all the different markets. I mean, certainly some of these dairies that were poised to grow or come on line for some of this point capacity seem to have found some cows. So, I mean, maybe that was part of tightening up the market at a time.

00;08;38;01 – 00;08;57;25

Yeah. I don’t know that growth comes on the back a lot more cows. To your point, we will get an updated report here at the end of January. So that’ll be kind of good to know. Fresh data replacement heifers. But it has been astonishing how much producers and you know I think we need to differentiate too between total flow and milk solids within that flow.

00;08;57;25 – 00;09;17;29

So even though like for instance, the November we were down 1% on milk production flow, total solids and that milk was still up 1.3. So the dairy producers probably go around the edges where they can increase flow and certainly have been on a trajectory of pushing solids within that milk, too. So I guess that’s where I see growth coming from.

00;09;17;29 – 00;09;43;01

I think in some years where margins have been like this on paper, we would have seen, you know, plus three plus 4% milk production growth. I don’t think we’re anticipating that. But growth nonetheless. And then also to one more quick thing, I feel that some questions over the last two weeks about this, I think some in the industry, maybe newer, are looking at those California wildfires and just seeing California and fires and are asking about milk impact.

00;09;43;01 – 00;10;02;17

You know, maybe Tiffany, as you’re from California, maybe just speaking quickly on how that is not an issue for milk production in California. Yeah, thankfully, what’s happening in the LA area isn’t too close to major dairy production centers. I mean, we used to have a few more dairies down in that Chino Valley, you know, which isn’t too far away.

00;10;02;17 – 00;10;25;11

But generally there aren’t a lot of dairies at risk here, and even friends and the very South Valley, how many skies are still clear? So in terms of smoke impacts, you know, we’ve heard of that impacting production before, not picking up anything along those lines I’ll add to from the demand side, a thing is this is the question that we’ve asked internally of how much of a potential demand impact could there be from these fires?

00;10;25;11 – 00;10;47;09

Because clearly there are tens of thousands of people that are displaced by these fires and could be displaced for a long time. And our initial read is that we likely won’t have any sort of major impact, at least right away. Certainly, it could shift to how people are purchasing product, more reliance on restaurants, but people still have to eat regardless of where they are.

00;10;47;11 – 00;11;11;15

A big thank you to Kevin, Tiffany, and Brett for joining me on today’s episode and sharing your insights with our listeners. Thank you, as always, to our media team for mixing and mastering. And thank you to you, the listener, for joining us today. If you like what you hear, subscribe on your favorite app. If you’d like to learn more about how we help people manage risk, contact us at insights.ever.ag

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The following music was used for this media project:

Music: Funky Intro 29 by TaigaSoundProd

Free download: https://filmmusic.io/song/9520-funky-intro-29

License (CC BY 4.0): https://filmmusic.io/standard-license

Artist website: https://linktr.ee/taigasoundprod

© Ever.Ag 2023, confidential and proprietary.

The post Parlor to Plate – January 15, 2025 appeared first on .

In the latest edition of the Hog Talk podcast from Ever.Ag Insights, we chat with Tom Brincks, VP of Insurance and Operations on Ever.Ag’s livestock team.

Learn more about lean hog price trends, risk management strategies, and specialty pork products. Tune in now!

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

(Transcript auto-generated)

Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities. Hello and welcome to Hog Talk, brought to you by our AG Insights. On this podcast, we talk with subject matter experts on news and topics affecting the swine industry and hog markets.

00;00;18;12 – 00;00;39;24

I’m your host, Phillip Flores. We’ll get started with a quick market recap as of yesterday, Monday, January 13th. Nearby lean hog futures were at $83.18 per 100 weight, up 4% on the week and up 16% year over year. Today we had the pleasure of being joined by Todd Brinks, ever vice president of insurance and operations. Hey, Tom, how are you today?

00;00;39;24 – 00;00;57;24

Good. Glad to be here. So wrote the notes ahead of the show and noted that we were up 16% year over year in terms of futures prices. We didn’t really have a big fall feed in the fourth quarter. The market has come off a little bit, but it’s still above last year’s levels. What are the 2 or 3 big questions out there for the market right now?

00;00;57;25 – 00;01;18;02

I mean, you bring up a great point talking about, you know, full feed that we didn’t have this past year. I mean, I think there’s probably still a few people in the camp that there could be a little bit of a pullback. But I think the bigger issue facing markets is and I hate to bring up the T word, I’m not talking taxes but potentially tariffs and what what impact it has on our markets going forward.

00;01;18;04 – 00;01;33;17

You know every four years in this country we have a presidential election. And there’s always impacts with elections. I think we’re all sitting on the sidelines waiting to see what the potential impacts are of this most recent election. Yeah, we’re going to go early and go hard. Are we going to kind of settle in? There’s a lot of negotiation being done.

00;01;33;18 – 00;01;53;09

It’s going to be a fascinating first couple of weeks as Mr. Trump returns office I believe next Monday. So from a producer risk management perspective, what’s your general view on things, especially the summers? You know, those prices look pretty good today in a vacuum. Are we coaching towards action? Are we hanging out waiting to see what happens? Where are we on risk management right now?

00;01;53;12 – 00;02;16;11

So I mean really time we have $100 summers. I think it needs attention in person, needs to take a hard look at them. What’s even more attractive about our current $100 summer months is input costs have come down. I mean, soybean meal is continues to drop, basis widening. That’s changed a little bit with Friday’s report. We have guys lined up a corn supply that at numbers they haven’t seen in several years.

00;02;16;12 – 00;02;35;05

So when you look at input costs compared to where the summer months are, you can lock in a fairly attractive margin anytime that opportunity is there. I think a person needs to give it a serious look. Yeah. Yesterday we had June at 102 48th July at 1 or 273, and August at 101 38. So all kind of right there in that 100 zone.

00;02;35;06 – 00;03;02;26

Let’s shift gears a little bit, Tom. You spent a lot of time in the insurance arena, many different facets. And it’s worth wondering what do wildfires in California and other natural disasters mean for the insurance industry? So we’ve seen Los Angeles fire. Lots of talk about the insurance consequences. What does it mean for livestock producers? Anybody who pays a regular insurance bill knows what insurance rates have done the last several years.

00;03;02;26 – 00;03;21;29

So any time you have a disaster similar to California with the wildfires right now, anybody in the insurance space or anybody that’s writing a premium check, it gets your attention in the big scope of things, the California fires, when this is all said and done and, you know, the fires are put out. I mean, we’ve seen bigger disasters than this.

00;03;21;29 – 00;03;41;05

But keep in mind, it’s the state of California. There’s some political opportunities for people to spin it. So I think in the next few months, we will continue to see California’s fires be talked about and be a reason for increased insurance rates, whether that’s actually the case, we all know how things get spun. And this one is ripe to be spun.

00;03;41;09 – 00;04;04;12

So, Tom, you were speaking that sort of at a high level PNC property and casualty perspective. And yeah, I mean, whatever insurance you have on your facilities and your automobiles, those all feel ripple effects, probably from an event like this. But let’s talk about crop insurance and, well, activity in the PNC space doesn’t have any direct impact on crop insurance programs like LGM swine LRP.

00;04;04;12 – 00;04;20;02

It does impact the industry overall. Right. And one of the things that happens behind the scenes at Ever AG and elsewhere is we’re always looking for to make sure that we have enough capacity out there to get the coverage we need for producers, right. And so that becomes a question. And all this too is big part of your job, right?

00;04;20;02 – 00;04;35;06

Is is like, hey, we want to make sure that the insurance companies are giving us the space to do what we need to do. Correct. There’s a lot to unpack in your question, so let’s back up. I mean, the one common denominator all insurance products have in common is they probably have some type of reinsurance tied to them.

00;04;35;06 – 00;04;57;06

So basically the insurance company passes the risk on to another insurance company which is called reinsurance. So whether you’re in the space and you’re protecting houses in California or you’re in the crop insurance space, you have to have access to reinsurance to have a healthy insurance environment. So if you back up a few years ago when interest rates were cheap, I mean, capital was readily available.

00;04;57;08 – 00;05;16;20

It didn’t cost much to operate. So insurance had access to potential investment dollars or reinsurance dollars as interest rates have creeped up with some of the potential investors who would put money up for reinsurance have other opportunities that give them a decent return. So even though we’re not directly tied, we are still indirectly tied on the reinsurance side.

00;05;16;20 – 00;05;36;17

We have a team here, and we spent a lot of time looking at the reinsurance markets, trying to make sure that the industry has enough reinsurance capacity. You mentioned LGM. You look at, you know, like swine, LRP in particular, the last four crop years. I mean, we’ve had forex growth just this past crop year, close to just shy of $50 million or growth.

00;05;36;19 – 00;05;54;06

So you’re growing premiums by that, those kind of dollars. It takes a lot of reinsurance capacity to make sure we can adequately service the market. So we’re always watching that. We’re always monitoring it and go full circle back to California. Fires shouldn’t impact us. That has a long tail, and we’ll be talking about it for a long time.

00;05;54;08 – 00;06;09;11

And it’s not to be alarmed about for the average, you know, customer. But it is something that, you know, we wake up and worry about every day is all right. We’re helping with risk management. These insurance products are really popular. Let’s make sure that we keep the capacity in line. Right. And just not to create undue alarms out there.

00;06;09;11 – 00;06;38;10

I mean, these are government programs. There are funding opportunities out there. But what we call APIs, approved insurance providers, they still need to be profitable. And the best way for them to be profitable is to go to outside reinsurance sources versus going to the federal government, moving from insurers topics to the center of the plate, per se. Tom, I shared recently with you a blog post from our friend Jeanette Brenner talking about high quality pork, some specialty product out there that’s sort of modeled after.

00;06;38;10 – 00;06;59;07

It’s like the Wagyu beef, pork, if you will. And we always talk about pork demand and how to grow it. And, you know, are there ways to use specialty cuts to do the job, talk about that product and talk about just an opinion on how, if anywhere, products like this can go. So no more information on that. Our internal team here in Ames, I think it’s safe to say you could call us food snobs.

00;06;59;12 – 00;07;18;18

So we’re always looking for that latest recipe or latest idea of what’s great to cook, great to eat. So when you shared that article, I went ahead ordered some pork. We did try it and kind of wasn’t a true blind taste test, but we bought some traditional pork from our local walker here in Ames. Basically salt and pepper on some pork chops.

00;07;18;18 – 00;07;39;16

And we compared it to this pork that you had recommended. It was actually Iberian pork, but very unique tasting experience. It was outstanding. I would say part of the group said it was the best pork chop they ever had, and everybody would rank it right up there in the top. We are very passionate about major risk on pork, but we’re also very passionate about delivering a quality product.

00;07;39;16 – 00;07;59;04

So we love to do those internal experiments and just see what’s out there and what’s possible. You mentioned Ames. Does it make you excited or nervous to see the Iowa State Cyclones men’s basketball team ranked number two in the United States this week, the highest rating ever for our state men’s basketball. Nervous or excited, I am 100% excited.

00;07;59;04 – 00;08;18;03

I mean, people always ask, why would you want to live in Iowa? And when you have Iowa State basketball and the hype that goes with it, it makes winters in Iowa very enjoyable. And we forget about the cold and we just think about managing risk, working with hog producers and watching Iowa State basketball. Well, it’s big in the poor household, too.

00;08;18;03 – 00;08;34;12

Having married an Iowa State alum, here’s a trivia question for you previous to this week’s number two ranking, what was the highest rank Iowa State has ever attained and when was it? I’m not the guy to ask. If I had a guess, I would say I think we got number three one other time. That is right. Number three.

00;08;34;12 – 00;08;52;05

According to the Des Moines Register today 1956 57 season, Iowa State was ranked number three. Number two this week, trailing only Auburn. I don’t know. We’ve got tickets to the big 12 tournament, but so far the momentum keeps going. So I’m assuming if you go back to the 50s, that was the Roland Rocket year. I didn’t go that far.

00;08;52;06 – 00;09;07;05

All right. Thanks, Tom, for your insight and thank you for joining us today. If you’ve enjoyed listening to Hogg talk, be sure to tell a friend or two and subscribe to us wherever you listen to your podcasts. Thanks for the Insights Crew for their work on today’s show.

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Free download: https://filmmusic.io/song/9520-funky-intro-29
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© Ever.Ag 2024, confidential and proprietary.

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

EVER.AG INSURANCE SERVICES IS A LICENSED INSURANCE AGENCY AND AN AFFILIATE OF EVER.AG. INFORMATION CONTAINED HEREIN IN THIS WEBSITE IS COMPILED FOR THE CONVENIENCE OF THE USER. INFORMATION IS OBTAINED FROM SOURCES BELIEVED TO BE RELIABLE AND IS FURNISHED WITHOUT RESPONSIBILITY FOR ACCURACY OR CONTENT. MARKET DATA IS SUBJECT TO CHANGE AT ANY TIME. Ever.Ag is a licensed insurance agency in the following states: AZ, CA, CO, CT, FL, GA, ID, IL, IN, IA, KS, KY, LA, ME, MD, MA, MI, MN, MO, MT, NE, NV, NH, NM, NY, NC, ND, OK, OH, OR, PA, RI, SD, TN, TX, UT, VT, VA, WA, WV, WI, WY.

The post Hog Talk – January 14, 2024 appeared first on .

View the video version of this episode here.

In The Grain Feed, Jim Matthews is joined by a rotating cast of analysts to discuss what dairy and livestock producers can be doing to manage their risk. This week, Jim is joined by Jake Kingsley and Jenny Wackershauser.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

The following music was used for this media project:
Music: Funky Intro 29 by TaigaSoundProd
Free download: https://filmmusic.io/song/9520-funky-intro-29
License (CC BY 4.0): https://filmmusic.io/standard-license
Artist website: https://linktr.ee/taigasoundprod
© Ever.Ag 2024, confidential and proprietary.

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The post The Grain Feed – January 8, 2025 (Audio Only) appeared first on .

In this week’s Parlor to Plate dairy podcast from Ever.Ag Insights, our expert panel breaks down the latest market dynamics and reports shaping the dairy and grain industries. How is 2025 starting for U.S. cheese exports? What trends are emerging in global butter imports and skim milk powder? And what surprises might Friday’s WASDE report hold for U.S. corn balance sheets?

Join host Katie Burgess and panelists Jon Spainhour, Matt Tranel, and Jake Kingsley for a spirited discussion.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

(Transcript auto-generated)

Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities. Hello. Welcome to Parlor to Plate a weekly podcast from ever again sites dedicated to offering listeners enlightening discussion and actionable dairy market intelligence. I’m your host, Katie Burgess. We’re excited to have you along, and if you like the show, please subscribe and tell a friend or two.

00;00;24;26 – 00;00;47;01

To kick things off. Let’s timestamp the episode. It is about 2:00 central time on Wednesday, January 8th, and here’s the latest rundown of CME spot markets today. Block cheddar closed at one 91.5. That’s up half a cent from last week. Barrels finished at 187 per pound. That’s up $0.05. Water is at 260 per pound. Also up a nickel compared to a week ago.

00;00;47;02 – 00;01;11;03

And nonfat dry milk is at 137 per pound. Down half a cent. Turning to the grain markets. March corn is at 454 per bushel today, down $0.04 from last week. Well, March soybeans are at 9.93 per bushel, down $0.17 from a week ago. So with that, let’s get to the show. Joined today by another great panel. First off, joining us from Chicago, Mr. John Spindler, who works with commercial dairy customers.

00;01;11;07 – 00;01;22;16

Also Matt Tranel coming to us from Platteville, Wisconsin, where he works with dairy producers, and Jake Kingsley out of Kansas, who keeps a close eye on dairy feed prices. Hey, guys, happy new year.

00;01;22;17 – 00;01;24;12

Happy new year. Happy new year, Katie.

00;01;24;13 – 00;01;26;00

Happy new year and happy to be here.

00;01;26;01 – 00;01;43;10

First year from a market perspective, it was an active two weeks. We did take two weeks off of the podcast though, as people celebrated holidays with family and friends. And as we come back this week, there is a lot to catch up on. Earlier this week we had blocks up in the mid one 90s, a two month high.

00;01;43;11 – 00;02;02;02

Today butter got up to 260, the highest we’ve seen in eight weeks. Plus, to get things started this week we had a lot of reports. We had dairy products report Monday afternoon, GDP auction Tuesday morning. Fresh trade data out on Tuesday. So just lots of good stuff to help us kick off the new year, figure out where we’re going with these dairy markets.

00;02;02;05 – 00;02;08;16

So, Matt, let’s start with you. This cheese market has had some strength. What’s the latest there?

00;02;08;17 – 00;02;30;19

Yeah. You know, I think that we’ve seen some pretty decent cheese exports in the Q1 period of time. Get books. I think it’s kind of the old analogy that low prices cure low prices. When we did trade down into the one 6165 area, most of the world was considerably higher up into $2 to ten, maybe a little bit higher than that.

00;02;30;20 – 00;02;56;22

And as a result of the price difference, the United States was the place to go to pick up any export business that was available through the holiday season. We also saw some fairly decent domestic demand along with it. And so as results, we have watched kind of this cheese market snuck up a little bit, and traders have been aggressively trying to find the product not always readily available.

00;02;56;23 – 00;03;16;25

As we’ve approached this dollar area, it seems like, at least for the time being, that we are a little bit more in balance. We’ve also watched as a result of cheese moving up. We’ve watched the funds really start to less in a short position and start to build a little bit of a longer position, which has also assisted in taking class remote futures higher as well.

00;03;16;26 – 00;03;45;28

Speaking of exports and different reports, we did have the trade data come out for November here recently, and some of the highlights that we did see were again, a very strong number for cheese exports were up 2% from 2023, numbers at 87 million pounds. Mexico continues to pace everybody, taking on another 35 million pounds of our product. And looking year to date, the United States crossed the 1 billion pound for cheese exports.

00;03;45;28 – 00;04;05;03

So that was a very impressive number on the butter front. Exports were just under 7 million pounds with Canada taking most of our products. But when you look at the import part of butter, I thought it was interesting because we did import a record 23 million pounds, mostly coming from Ireland. So that was interesting piece on the butter report.

00;04;05;03 – 00;04;16;05

Powder shipments were very low, just 119 million pounds. That’s the lowest since August 2019. And way exports were fairly decent. So it’s kind of a brief rundown on that report.

00;04;16;08 – 00;04;33;04

Thanks for that, Matt. I mean, to your point, from a cheese export perspective, 2024 is going to go down in the books, most likely as a record year. From a butter import perspective. Apparently U.S. consumers cannot get enough of that. Irish butter likely goes down as a record import year for butter, so lots of interesting stuff in the trade data.

00;04;33;04 – 00;04;52;21

And exactly to your point, I think as I talked to customers about what are we watching here in 2025, the story is still probably all about what’s going to happen with these cheese exports. So thanks for the rundown there. And speaking of what’s going to happen in 2025 and looking at international markets, John, I know you watched that GDP auction very carefully out in New Zealand.

00;04;52;22 – 00;04;55;04

Can you give us the rundown of yesterday’s results?

00;04;55;06 – 00;05;27;07

You’re absolutely right, Katie. The GDP was yesterday watching it pretty closely here. I would just say on aggregate the GDP was down about 2.9 star performers of the day, where butter and cheese butter was up 2.8%, coming in around 309. Cheddar was up about 1% coming in around 214 and mozzarella up 3.4% coming in at $1.89. However, as we switched to the powder side of things, that’s where the downgrade on the overall aggregate result came.

00;05;27;08 – 00;05;53;09

Skim milk powder down 2.7%, coming in around 122 on the auction. There’s European powder that is for sale as well on there now, and we see that that’s trading in the 114 to 115 area as we go, where a whole milk powder came in 2.2% lower. And this is the second lower whole milk powder in a row. And I believe the third lower SMP result in a row on the GDP.

00;05;53;12 – 00;06;13;15

If we were to say what changed things in there, I would just say we’ve seen China be pretty active for several months of the year, year. And I think we saw them doing a little bit of restocking and a little bit of trade channel shuffling. We saw them buy More here on the GDP, but probably a little bit less from other areas, specifically the US, especially for SMP.

00;06;13;15 – 00;06;35;05

As Matt was pointing out there, exports were down relatively significantly for skim and nonfat dry milk powders. I think there’s two things to that are production was lower would be our price was higher. Right. We’ve been up in this 137 to 140 area during the time when the rest of the world has been at $1.25. And like I mentioned, Europe is now in the 115 area.

00;06;35;05 – 00;06;45;07

So part of it is we have less product to export. We’re probably not going to export because our price is so high right now. So those are kind of some of the things that we point out that happened on the.

00;06;45;07 – 00;07;04;23

GDP for sure. It’s I think very notable to see that historically, we don’t have big gaps in prices between global suppliers of powder prices for long, and the U.S. has been lowering quite a bit higher than the rest of the world. And so I think that the US market does have support to your point of making us here nervous about what’s happening in California.

00;07;04;23 – 00;07;11;13

But at the same point in time, the global market is going to continue to tug us lower. If possible, just because we’re not price competitive.

00;07;11;13 – 00;07;29;15

My general thought on that would just be that we can see California milk production was lower, right? We know that dairy products doesn’t quite state that total powder production was lower, but it was right. We know that for sure. You can’t have California milk production go down 10% and not affect powder production. So again, we didn’t have that much to export.

00;07;29;15 – 00;07;47;03

But if milk production comes back as bird flu passes through California, we see milk production come back. We’re probably going to have more powder to sell, and we’ll need to export that. And when we do, it’s going to probably have to go at those lower international price levels as opposed to our domestic price right now, for sure.

00;07;47;03 – 00;08;02;14

And I think that brings up another question that also heading into 2025, lots of questions about milk production. Where do we go with avian influenza? Do we have enough heifers out there to grow the herd? I know, Matt, you’re talking to producers from around the country. What’s the latest you’ve heard on the milk production front?

00;08;02;14 – 00;08;25;02

Yeah, I know when you’re talking with producers, a trip in Wisconsin here last week and a common theme was where’s all the milk going to come from? And ultimately it still shows outside of the holiday weeks that milk is very snug around the holidays. It still gets a little loose. But anybody that’s taking in milk that might not have maybe a load or, contract for that can pretty easily resell it at a premium in today’s market.

00;08;25;02 – 00;08;46;14

So I think that’s pretty common across most parts of the United States. I know it’s tight in California. It’s tight here in Wisconsin. I know there’s some buyers looking for milk down in the southern parts and the southern states as we fill these new cheese plants. From what I’m hearing, it’s still pretty snug. But as we move forward in 2025, it does still look like we’re moving towards a market that is expecting more milk than what we have here today.

00;08;46;15 – 00;09;04;19

Yeah, I agree with that. I mean, I’d say our average milk production model points to growth in 2025. It’s just these wild cards out there. Where do we go next? Are other areas impacted by avian influenza? You know, one of the reports that we look forward to all year is at the end of January, USDA gives us the latest data about how many heifers we’ll have in the year ahead.

00;09;04;19 – 00;09;19;11

So looking forward to that report when we get it in a few weeks. And speaking of other reports that will get here sooner rather than later. Jake, I don’t want to leave you out. We’ve got a ways to report this week to get the latest on the grain markets, and I know this January 1st can be a big one.

00;09;19;11 – 00;09;22;03

What are you guys watching for when those numbers drop on Friday?

00;09;22;03 – 00;09;47;28

Yeah, I think there’s a fair bit of anticipation around Friday’s report here. January typically is kind of the last call on this most recent crop year, as far as any adjustments USDA might make to yield or acreage. Any of those production numbers kind of get finalized here in January. And I think there are questions around what may happen to the corn balance sheets.

00;09;47;28 – 00;10;17;12

Specifically, we had a very sizable cut to ending stocks in December due to an increase in export and ethanol demand for corn. Now, the question is, is there another sizable adjustment coming? We’ve kind of continued to rally the futures curve, at least this old crop futures market. From that report up to this point now. So I think folks are expecting some sort of alteration to the balance sheet again this month potentially.

00;10;17;12 – 00;10;39;24

Maybe it comes by way of South America. They had a little bit of a dry spell there very briefly that kind of brought crop conditions down. Still very much at or above the five year average on crop conditions down there, and have a sizable production number still anticipated for their harvest in the next couple of months. But there have been a few tweaks here and there that have started to add up to smaller domestic and global balance sheets.

00;10;39;24 – 00;11;08;18

On the corn front. On the protein side, I think folks are maybe expecting a few less fireworks from the last year. The concern there continues to be around tariffs and Inauguration Day being less than two weeks out. At this point, the most obvious one for us to work on on the feed side is what do tariffs look like for Canada and all of the canola that comes south across that border, and to feed banks here in the US.

00;11;08;18 – 00;11;30;04

And who incurs that cost increase if it is to go into effect. So we’re watching that. We’ve seen canola markets kind of tighten up. And vendors being less interested in putting offers out there for the forward curve. Certainly more interest in looking at soybean meal, moving back into the ration in some markets where they are heavily favoring canola right now.

00;11;30;04 – 00;11;32;03

So a couple things to watch on that end.

00;11;32;03 – 00;11;41;27

So Jake thank you Canada. Also this week big political news there. Prime Minister Trudeau announcing that he’s going to step down. Does that impact the canola market or the markets in any.

00;11;41;27 – 00;12;00;16

Way I think so I think it’s hard to say exactly how that plays out in the long term. It really depends on who comes in there next. But what I do foresee happening is if you had Trudeau still in there, he and Trump had already had an initial discussion and were going back and forth a little bit about this tariff rhetoric with him stepping down.

00;12;00;16 – 00;12;22;04

I think that kind of leaves a void where whatever policies we implement day one or week one or however early in the Trump presidency, it will take a lot longer to resolve with unknown changes coming to Canadian leadership, there won’t be near as many opportunities for quick discussion.

00;12;22;08 – 00;12;45;17

It’s a good point, and I think we have, you know, corollaries in the dairy market as well of there’s a lot of moving pieces here in the market fundamentals themselves as we head into the new year. And then you add in the uncertainty around what’s going to happen with trade and tariffs and politics. Also, I guess just to mention potential port strikes, lots of things to be watching as we keep an eye on these markets here over the next really couple of months.

00;12;45;17 – 00;13;03;08

So we’ll see where it goes. But well, there are lots of questions to ask. We’ll have more podcasts coming to you as the year unfolds, so we’ll leave those questions for another day. I think that’s it for today. Big thanks to John. Jake and Matt. Appreciated the conversation today. Also big thanks to the Our Insights team. Thanks for your production support.

00;13;03;09 – 00;13;15;12

And of course, thank you to you, the listeners. We appreciate you tuning in. If you like the show, please hit subscribe. And if you’d like to learn more about how we help customers manage price risk, please contact us at [email protected].

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The following music was used for this media project:

Music: Funky Intro 29 by TaigaSoundProd

Free download: https://filmmusic.io/song/9520-funky-intro-29

License (CC BY 4.0): https://filmmusic.io/standard-license

Artist website: https://linktr.ee/taigasoundprod

© Ever.Ag 2023, confidential and proprietary.

The post Parlor to Plate – January 08, 2025 appeared first on .

Host Cody Koster and Jon Spainhour take a deep dive into this week’s GDT report.

Questions or comments? Contact Jon at [email protected], Cody at [email protected], or give us a call at (312) 492-4200.

(Transcript auto-generated)

Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities.

00;00;08;27 – 00;00;17;06

Hello everybody. Welcome back to another GDC Tuesday. I am your host, Cody Koster, with me from Chicago, Mr. John Spain, our John, how are you doing in this new year?

00;00;17;06 – 00;00;24;27

I am doing well. Cody and I am so happy to be here once again. And happy New Year to you and to all of our listeners. We are happy to.

00;00;24;27 – 00;00;26;08

Have you back for the.

00;00;26;08 – 00;00;28;07

First GDP.

00;00;28;09 – 00;00;32;29

Of 2025. A little bit of a lower GDP coming in that negative two.

00;00;32;29 – 00;01;01;00

Point 9% as a whole for this round. You’re exactly right. Prices were lower here, 2.9% on the aggregate. You know some of the standout players here. Let’s start with the fat side. We’ll say that butter came in 2.8% higher coming in right around 3:09 a.m. came in 1.3% lower. How about 325 when we try to look at it through the fat lens, I would just say that those are one offset the other.

00;01;01;00 – 00;01;22;19

There. Right when we get to the cheese side though, cheddar was up 1%. And that’s going to come in about $2.14 on the cheddar side. Mozzarella though was up 3.4%. And kind of the star of the show here, however, only up to $1.89 as we move into the powder side. Here’s where a little bit more of a let down here.

00;01;22;19 – 00;01;46;11

Whole milk powder came in 2.2% lower. I would just say that yes, that was lower. But I also want to point out that came in higher than the last GDS pulse was suggesting we were going to come in at. And it also came in a little bit higher than where whole milk powder futures were pricing net. Since the last auction, which was three weeks ago, we’ve seen whole milk and skim milk powder futures really get decimated here.

00;01;46;11 – 00;02;09;13

So I think everyone was expecting that it was going to be lower. I would just say the whole milk powder overperformed a little bit when it comes to skim milk powder. Skim milk powder was down 2.7%. When we bring everything together here, I would just say that the GDC pulse was looking for down about 2.4% and some of the futures were actually looking for a little bit better price than that.

00;02;09;13 – 00;02;31;10

So I would say skim down 2.7%. And I would say that that fared a little bit worse than both the futures and the GDS pulse were suggesting out here. Overall, though, I guess it was kind of a doom and gloom feeling coming into this one from a lot of people. And I guess I would just say I don’t feel like the net result was doom and gloom.

00;02;31;10 – 00;02;49;23

I felt like, yes, we were lower, but it was kind of a better result than what I’m might have expected. Just hearing the rhetoric out there. I would also just want to point out that the skim milk powder futures and the settlement here for this auction, this is going to be the lowest result that we’ve seen since the middle of August.

00;02;49;23 – 00;03;06;10

So prices have kind of stepped back here on the skim milk powder. And when we get to whole milk powder, you know, we’re off our highs. But not by much. So a small decrease here in the last two auctions. And again, this whole milk powder result was better than what most people had anticipated.

00;03;06;13 – 00;03;16;17

I think one of the standouts on the higher side was butter, coming in at 2.8% higher on this auction, like a price of 309 for the average.

00;03;16;21 – 00;03;38;24

Yeah, it did okay, right. We have to acknowledge that that it did do okay for 309 up 2.8%. However, I just don’t know that it’s anything that’s like really changes the rhetoric when it comes to the fat market. I would just say that it is kind of in line with where the world fat market was. So but it is higher in the US and at the same point in time, lower than the EU price.

00;03;38;24 – 00;03;41;17

So New Zealand butter sitting right there in the middle.

00;03;41;22 – 00;03;52;17

And I know looking back John we’re talking about cheese I know cheese. Mozzarella came in 3.4% higher here in cheddar was 1% higher. But wasn’t it expecting a little bit lower of a trend on cheese for the average?

00;03;52;17 – 00;04;14;15

I would just say that the US price now right on mozzarella. At least we’re at one 9150 in blocks, right? That’s going to put us higher than the mozzarella price on the GTI and generally higher than the EU price of mozzarella. It looks to me, though that cheddar at 214, as we’re seeing here on the auction, is probably one of the higher cheese prices in the world.

00;04;14;16 – 00;04;30;28

Again, though, we have to be so careful or we’ve been kind of schooled to be so careful about the way that we compare these cheese prices specifically when it comes to cheddar. Nevertheless, cheese was higher, and higher is higher. The New Zealand cheddar price is the highest in the world right now, so something to be aware of.

00;04;31;02 – 00;04;33;23

Something to keep our eye on for sure. I’m moving.

00;04;33;23 – 00;04;35;09

To the.

00;04;35;09 – 00;04;52;01

Regions for buying. I mean, nothing stuck out as like a blinder in the face I guess on who was buying or who wasn’t. I mean, the Middle East was up 41% from last event three weeks ago, and North Asia was down 21%. But other than that, something that stuck out to you yourself majorly there.

00;04;52;02 – 00;05;13;04

You know, I think we’re just in terms of participation, as you pointed out, North Asia and or China down 21% on the event change from event to event, but again up 9% year over year. So I think the Chinese really step back on this auction versus what they have been doing here over the last three months, but they’re still, you know, 9% higher than the year before.

00;05;13;04 – 00;05;36;25

So pretty decent clip. It’s important to remember that we’re past the high tide, if you will, of New Zealand offers. And from here on out we likely see less volume than more. Right. So on this auction, there was 6% less volume than on the auction before. And that’s been moving progressively lower here. So here we are in a time when the offers are lighter and prices are going down, kind of convert to what we might think is going to happen.

00;05;36;25 – 00;05;57;01

But I guess I would just generally say it feels like buyers got what they needed and are stepping down their demands as the supply goes down. Or set another way, they time their demand to come in and pick up the most volume when the most volume was available and prices did go higher. But now, as volumes are going down, they’re stepping off a little bit here.

00;05;57;02 – 00;06;16;10

I think that kind of stands out to me. The Middle East, you know, as you pointed out, up 41%. There are a third biggest buyer on there. They were up 41% event to event, but down 13% year over year. So again they kind of come in and out of there. I just don’t know that there’s anything I can get that excited about as it comes to these volumes.

00;06;16;10 – 00;06;33;22

I think what we are seeing, though, is no China. It’s still just this wild card of, hey, are they here? Like in the way that we’ve seen them in the past? And if they’re going to, to buy, you know, a little bit more than they normally do on a year over year basis, then that’s supportive right to the marketplace.

00;06;33;22 – 00;06;58;01

But it just feels like it’s still one of those deals where it’s like, boy, they could continue to step away at any time. And you can see as they step down their volumes, prices come lower. So it’s still just a little bit iffy in my mind. I think Steve and the Fresh Agenda team have done such a nice job of watching China and explaining, hey, it feels like China is here, but it feels like maybe they shift some of their demand out of Europe, right?

00;06;58;01 – 00;07;17;18

And out of the US, and they’ve put it on New Zealand. So yes, they’re buying more on the GT from what we can tell from, you know, the imports that they haven’t really bought in more in the world so much as there’s a little bit of a channel switching, meaning instead of buying out Europe, they’re just buying a little bit more out of New Zealand and specifically buying it on the GTI.

00;07;17;22 – 00;07;20;19

So just a little bit of changing hands where the buying is coming from.

00;07;20;19 – 00;07;42;18

Essentially it feels like that. And at the same point in time, let’s just not ignore. They bought a lot, right. And prices went up correspondingly. One of the other things I would just point out here, as it relates to nonfat and skim, is probably our most relatable product out here. And that is that on the GDP, right. We showed there that the New Zealand price did okay, right.

00;07;42;18 – 00;08;02;14

Coming in at about a one 2121 area, maybe as high as 122. However, when we dig a little bit deeper into the auction results, we can see that there was some skim milk powder that came out of Europe that was put up here on the auction, and it comes out trading at about $1.15 a pound. Now, I don’t want to make too much out of that.

00;08;02;14 – 00;08;26;04

I don’t know that the GT is the most developed market and related to these other products, but I would just say it’s important to point out this is a $1.14 to a $1.15 trade. It was some U.S product that went up there and actually did trade on the auction today, and it came in at $1.17. The reason I bring this up is we also got our export report today for November.

00;08;26;04 – 00;08;45;29

And what we can see on there is in November, we had our second lowest nonfat export run and the last three years at least. Now there are a lot of reasons for that. We had bird flu in California. We saw the dairy products report we made less nonfat, right. That was less nonfat or skim to export. At the same point in time, we saw our inventories go up right.

00;08;45;29 – 00;09;05;19

And you say, well, why is that? And I think it’s very much we lost exports, right? We were priced out of the export market. And I think that we can see it now in the export side of things. You can make the argument that says, well, that’s fine because we didn’t really have anything to export. However, if California behaves like every other state has, milk production is likely to come back.

00;09;05;19 – 00;09;22;03

And as it comes back, there’s going to be more nonfat that has to be manufactured, and then that nonfat is going to have to more than likely be exported. I just want to bring that up from the standpoint that currently the export market stands between 114 and 122.

00;09;22;06 – 00;09;29;18

Yeah. Like you mentioned that milk production is going to come back. It might not be for the month of December, the month of January, but sooner or later the production is coming back.

00;09;29;19 – 00;09;48;12

Production is coming back. And I just don’t know how to predict that. I recognize that milk is tight in California right now. I recognize that nonfat is tight in California. There is no doubt about that. And again, you can say, doesn’t matter that we didn’t get the exports because we didn’t have the nonfat to export. However, I just can’t take my eye off the ball as saying every other state has rebounded.

00;09;48;12 – 00;10;01;22

You know, when they come back, it comes back with quite a bit of milk. And in California, I think it’s going to result in more nonfat production or nonfat production needs to be exported. And I think that means that the price at this point in time, the price is going to have to come down. Maybe in the next few months.

00;10;01;22 – 00;10;17;27

The international markets strengthen and provide us the ability, you know, to export at the current prices. But my guess is, is that we’re going to see the U.S. price go down. And I think when we look at the nonfat futures, they’re kind of meeting us half way, right. They’re saying, yeah, we’re going to go down, but we’re not going to go all the way down to those prices.

00;10;17;27 – 00;10;25;28

They’re certainly discount to the current spot market, but also higher than the rest of the world, especially on this first and second quarter.

00;10;26;00 – 00;10;44;23

Awesome. Well, John, I appreciate the deep dive into the first GDP of 2025. And our next one is going to be two weeks from now on the 21st, we should be back in our two week rotation for a little bit of time here. Then we kind of jump in the first week of February. So with that, we appreciate everyone tuning in and listening.

00;10;44;23 – 00;10;55;02

If you have any questions, comments, concerns, please let us know. We’d love to address them. As far as the auction, but until next time John. Again, thank you’ve been on everyone. Thanks for listening. We’ll see you later.

The following music was used for this media project:

Music: Funky Intro 29 by TaigaSoundProd

Free download: https://filmmusic.io/song/9520-funky-intro-29

License (CC BY 4.0): https://filmmusic.io/standard-license

Artist website: https://linktr.ee/taigasoundprod

© Ever.Ag 2023, confidential and proprietary.

This episode is also available on the following
platforms:

-Apple Podcasts-

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—–Spotify—–

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The post GDT Review with Jon Spainhour – January 07, 2025 appeared first on .

View the video version of this episode here.

In The Grain Feed, Jim Matthews is joined by a rotating cast of analysts to discuss what dairy and livestock producers can be doing to manage their risk. This week, Jim is joined by Jake Kingsley and Cody Koster.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

The following music was used for this media project:
Music: Funky Intro 29 by TaigaSoundProd
Free download: https://filmmusic.io/song/9520-funky-intro-29
License (CC BY 4.0): https://filmmusic.io/standard-license
Artist website: https://linktr.ee/taigasoundprod
© Ever.Ag 2024, confidential and proprietary.

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The post The Grain Feed – January 2, 2025 (Audio Only) appeared first on .

View the video version of this episode here.

In The Grain Feed, Jim Matthews is joined by a rotating cast of analysts to discuss what dairy and livestock producers can be doing to manage their risk. This week, Jim is joined by Jake Kingsley and Katie Burgess.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

The following music was used for this media project:
Music: Funky Intro 29 by TaigaSoundProd
Free download: https://filmmusic.io/song/9520-funky-intro-29
License (CC BY 4.0): https://filmmusic.io/standard-license
Artist website: https://linktr.ee/taigasoundprod
© Ever.Ag 2024, confidential and proprietary.

Disclaimer: TRADING FUTURES AND OPTIONS ON FUTURES INVOLVES SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THE INFORMATION AND COMMENTS CONTAINED HEREIN ARE PROVIDED BY EVER.AG AS GENERAL COMMENTARY OF MARKET CONDITIONS. THIS INFORMATION SHOULD NOT BE INTERPRETED AS TRADING ADVICE OR RECOMMENDATION WITHOUT FURTHER DISCUSSION WITH YOUR EVER.AG ADVISOR. THIS IS A MATTER OF SOLICITATION.

The post The Grain Feed – December 19, 2024 (Audio Only) appeared first on .

In the latest Parlor to Plate dairy podcast from Ever.Ag Insights, our all-star panel digs into the “nice and naughty” market trends shaping the close of 2024. How have rising cheese exports and lower feed costs impacted dairy producers this year? What challenges lie ahead with volatile whey prices, tight heifer supplies, and ongoing impacts of avian influenza on milk production? And what are the big questions for 2025, including new cheese processing capacity and export competitiveness?

Join host Katie Burgess with panelists Brian Fletcher, Ryan Yonkman, and Natalie McCarty for a lively discussion.

Questions or comments? Topics you’d like to hear us discuss? Contact us at [email protected].

(Transcript auto-generated)

Future trading involves risk and is not suitable for all investors. Content provided in this segment is meant for educational purposes and is not a solicitation to buy or sell commodities.

00;00;08;28 – 00;00;32;13

Hello and welcome to Parlor to plate, a weekly podcast from ever again sites dedicated to offering listeners enlightening discussion and actionable dairy market intelligence. I’m your host, Katie Burgess. We’re excited to have you along. If you enjoy the show, please like it. Subscribe and tell a friend or two. First, let’s timestamp the episode. It is 10 a.m. Central Time on Wednesday, December 18th, and here’s your rundown of CME spot markets over the past week.

00;00;32;13 – 00;00;54;10

Yesterday, black cheddar close at 186 per pound. That’s up $0.13 from last week and the highest price in more than a month. Barrels also higher, finishing at one 7850 up $0.10 from a week ago. Butter is at 252 per pound, down a penny, and nonfat dry milk is holding at 138 per pound. Turning to the grain market today, March corn is at 442 per bushel.

00;00;54;12 – 00;01;18;16

That’s down $0.06 from a week ago. While soybeans are at the lowest level we’ve seen in quite a while. January soybeans at 956 per bushel. That’s up $0.39 from a week ago. So let’s get to the show. I am excited today to be joined by some of my nicest colleagues. We’ve got Brian Fletcher coming to us from Chicago, Ryan Jackman also from the Chicago area, and Natalie McCarty out in California.

00;01;18;21 – 00;01;21;04

How are you guys doing today? Looking forward to Christmas.

00;01;21;07 – 00;01;21;29

Oh ho ho.

00;01;22;02 – 00;01;24;03

Nothing like a Santa Claus rally.

00;01;24;05 – 00;01;42;21

I agree. That’s right. The excitement has been building in the markets. Here we are Wednesday morning reporting. We’ve got one week from today. We’ll all be gathered around the Christmas tree, probably knee deep and wrapping paper by that time. So as we think about wrapping up the year, how have things played out here over the course of 2024?

00;01;42;22 – 00;01;58;09

The team today is rounded up some of the nice and naughty factors that we’ve seen across the dairy and grain markets here over the past year, and I’d say we’ve had our handful of both, definitely some very nice things that have happened in the markets in 2024. What do you have? Those markets have also gotten up to some ish yet.

00;01;58;09 – 00;02;15;16

So what to call out? What we see as some of those big factor is heading into your end. Before we jump into it though, we will say that we know we have listeners all across the dairy spectrum in market as some people like low prices, others like high prices. So as we walk through today, we’ll talk about it from either a buyer or seller perspective.

00;02;15;16 – 00;02;26;00

But know that, you know, in these markets we have people who sit on all sides. So kicking things off, Brian, I know you work with dairymen each and every day. What was one of the nicest things they saw this year?

00;02;26;01 – 00;02;43;01

Yeah, I think from a holistic standpoint, for the most part we’re going to say aren’t farm margins. We’re in the nice category. We know the first half started a little rough, but we certainly ended the year pretty strong. And so we can say on fine margins with good milk prices, cheaper feed finally, and certainly some version of record high cattle prices.

00;02;43;01 – 00;02;44;12

What’s that in the nice camp.

00;02;44;17 – 00;03;02;14

Oh for sure. I mean, this year it didn’t necessarily start off so nice, especially if you were in cheese territory. But as the year continued, those higher prices are sure a big benefit to the dairy producers out there. How about you, Fletch? I know you’re working with commercial customers on the buy and the sell side. What’s one of the biggest nice things you saw here in 2020 for.

00;03;02;15 – 00;03;27;28

2024? I think we’ll look back at this year and say it is officially the banner year for cheese exports. All year long we’ve been exporting at a record setting pace and that’s been fantastic. So within that, it’s definitely a highlight. What’s really interesting about that, though, is actually this week for the first time, the US is no longer the clear cut low price around the world.

00;03;27;28 – 00;03;50;20

So we’ve had a really good year for 2024. And I think with the amount of new processing capacity coming online, looking at the domestic demand growth environment, we’re going to need to continue to build on the record setting pace that we’ve had in 2020 for moving forward. So it’s been really good, but looking forward, it’s going to be a little bit more challenging, at least.

00;03;50;20 – 00;04;18;16

To get new exports on the books doesn’t mean some are already on the books. It just means like getting new deals done is going to be a little bit more challenging. What the EU market in the low one 80s for mozzarella cheese. Our block market is in the mid one 80s. So on a spot price and forward price, you can find cheaper sources of product on the global market right now, which I would say without some big changes down the road could be a little problematic for the US market.

00;04;18;16 – 00;04;22;15

But for now, let’s celebrate a banner export year for 2020.

00;04;22;15 – 00;04;38;26

Four for sure. And I think that is the question on everyone’s mind for 2025, as we’ve had a good window here to get some sales booked. But you know, how much was it and is it going to be enough given the new cheese capacity coming online. So we’ll see what 2025 brings for the cheese export market. And Natalie, how about you?

00;04;38;26 – 00;04;43;13

It feels like an easy one over on the food side. Lots of nice lower prices here. This year.

00;04;43;16 – 00;05;14;26

Absolutely. Ryan touched on that. I think if I had to categorize it in the nicest thing in the market, the feed market would be soy meal prices. That influences your canola prices and also your soy meal and your bypass proteins. That is down 32% this year alone versus last year. Switching over to you know, I know people aren’t going to necessarily think this is the case, but what I would maybe call a naughty kind of a mixed, actually, but a naughty at the moment is corn prices.

00;05;14;26 – 00;05;36;11

The USDA did come out with a report last week. They reduced the U.S. ending stocks. And conversely, that has put a floor underneath pricing at the moment. So we’re really only down about 3% versus last year. I’m going to also talk a little bit about the fact that even though that’s a little bit of a naughty, it’s not as good as it was.

00;05;36;12 – 00;05;46;13

We also, though, need to be reminded that we’re down 16% versus a five year average. So still great, great prices and things that need to be taken advantage.

00;05;46;13 – 00;05;55;12

Of for sure. To your point, we’re not as low as we were. It’s still not bad relative to the long run of history, but not quite as sweet as we see on the protein side.

00;05;55;12 – 00;06;00;24

Absolutely. And I think it’s a good reminder that managing risk is very, very important for sure.

00;06;00;24 – 00;06;17;17

I think that is key across all these markets as we head into potentially what could be a volatile 2025. I guess from there, we think about some volatility in the markets that might have been I don’t know if we’ll call a naughty, but we’ll say up to some mischief what the way market has been on quite the run here.

00;06;17;18 – 00;06;19;25

How would you categorize that one for 2024.

00;06;20;00 – 00;06;45;27

That one in terms of a demand highlight? I think it absolutely has been a shining star. We’ve heard, especially once you get into the higher protein ways, whether it’s 80 or isolate, it feels like that market in general has expanded. So what’s been really interesting recently is the driveway price, which tends to be the input cost to making the higher end proteins.

00;06;45;27 – 00;07;20;19

That’s really done a number in terms of catching up on a multiple basis, catching up to the pricing. So what’s been interesting recently is we’ve really heard that the rising driveway costs relative to the equity prices has now encroached on the margin potential for the manufacturers. So it’s been interesting with the driveway market moving all the way up to the I-70 since area, we’ve heard in some cases that it’s not a clear cut decision to be making the higher end proteins, and it doesn’t mean that the higher end proteins can’t make a leg higher.

00;07;20;19 – 00;07;45;01

It just means that the current situation we’re in is it’s not a no brainer to be making that. So we’ll see how we go into 2025, see if the momentum continues. If not, it almost feels like we’re at the first layer of resistance that we’ve had in the market in, let’s just say, all year long. But overall, in terms of dairy demand, the higher end protein category has been exceptional all year long, for sure.

00;07;45;01 – 00;08;02;00

I think that definitely goes on the nice list in terms of dairy demand, higher prices as way impacts class three values. Just a challenge. If you’re a buyer out there to get that product as you see those prices going up and up. But to your point, 2025 is a new year. We’ll have some new capacity and we’ll see how it all evens out for us.

00;08;02;01 – 00;08;18;17

Yeah, I will see a history suggest that this price point, there isn’t much time that we spend up here. You never know what the future brings. But what tends to happen is we run into a brick wall right now, at least on the higher end protein that we just haven’t heard of that pushback yet. So we shall see.

00;08;18;17 – 00;08;25;24

But watching carefully to see when it comes south for sure. Brian, how about you? Any naughty factor this year on the dairy producer side of things?

00;08;25;24 – 00;08;43;15

Yeah, I mean, I guess I’ll take the obvious, right? Not certainly avian, which you can strip out in regards to what it meant to markets. Right. Anybody certainly having to deal with that throughout this year. And by no means is it done. We’re all still very aware of this actively moving throughout the United States. It’s naughty right. It’s been a problem.

00;08;43;15 – 00;08;52;18

It’s not been fun. And that’s going to live in that camp till we figure out how to treat it or gain immunities or whatever that might be. That is yet to be figured out just yet, for sure.

00;08;52;18 – 00;09;12;01

And I mean, just as the update that we’ve had the past few weeks, we continue to see cases in California and we do get a milk production report tomorrow, December 19th. So it’ll give us a fresh look of, hey, how much of an impact did avian influenza have in California during the month of November? Contacts out there suggests that it was probably a little worse than we had seen the month prior.

00;09;12;01 – 00;09;26;17

But I guess, you know, as we look towards 2025, at least for California dairy producers, now that this is a great target. But so many of them have had it at this point. And so hopefully those case numbers will start to slow out there. But then, of course, you know, there are some areas of the country that haven’t had it yet.

00;09;26;17 – 00;09;32;03

So I think it’s going to remain a big watch factor of what happens with milk supply as we make our way into 2025.

00;09;32;06 – 00;09;50;15

Yeah. And it’s still laid up against you know, you could call this a naughty nice list all on its own in regards to the cattle market. We know our heifer replacements are still very tight. We could call that nice. And hey, that’s not going to allow us to turn the spigot on any major way. But it’s also creating problems for dairies that have to backfill dealing with avian.

00;09;50;15 – 00;10;04;25

And we know heifer prices are extremely high. Not really any writing on the wall that says that should change when you consider the supply environment we’ve got. So yes, it is a watch factor. The heifer replacement market will continue to be a watch factor as we go into next year.

00;10;05;01 – 00;10;21;28

Well, on that note, there’s plenty of stuff for all of us to keep an eye on as we head into the new year. But thanks so much for joining me today. Brian, Brian and Natalie appreciated your comments, and there’s fun running down the list with you, as there have been a lot of different things happening in the markets here in 2024.

00;10;21;29 – 00;10;44;08

Also, big thanks to our listeners. We really appreciate your support and a big thanks to the other insights production team. If you like the show, please hit subscribe on your favorite podcast app. And just to note that we’ll be taking a break next week for the holidays, but we’ll be back with fresh new episodes in 2025. We appreciate everything you do, and if you’d like to learn more about everything, please contact us at [email protected].

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