Trump/Xi Reschedule Causes Soybean Rally + E15 Ethanol Waiver

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President Trump is headed to China 🇨🇳 for a high-stakes meeting with Xi, and markets are already reacting. Soybeans surged on the news, while corn and wheat followed higher amid fertilizer and acreage concerns.

The EPA also issued another E15 summer waiver ⛽🌽, keeping ethanol demand supported—for now. But with plants already running near capacity, how much more corn can actually be used?

Meanwhile, fertilizer prices are rising fast 💥, USDA funding is being cut 💰, and ethanol production/margins are improving 📈.

👉 Plenty to unpack across energy, policy, and grain markets.

Subscribe for daily updates 👍 and drop your thoughts in the comments!

Transcript

Trump/Xi Reschedule and Soybeans

SPEAKER_00 0:08

Morning guys. It's Thursday, March 26th, 523 a.m. Central Time. Green markets are mixed this morning. May corn futures up a quarter cent at 467 and a half. December corn futures up three quarters of a cent at 494. May soybeans up a quarter cent at 11.72. November soybeans up a half cent at 11.50 and a half. May Chicago wheat down three at 594 and three-quarters. May Kansas City wheat unchanged at 6.17 and three-quarters. May spring wheat up three quarters of a cent at 641 and a half. Trump and G have rescheduled. Let's start there.

SPEAKER_01 0:39

Yep. So following a delay caused by the conflict in the Middle East, President Trump will visit Beijing on May 14th and 15th to meet with the G. The conflict has added new strain to U.S.-China relations, particularly given that Iran is a key trading partner for China. The leaders are expected to discuss trade, Taiwan, and energy security, along with a potential trade enforcement mechanism to address ongoing disputes. According to the White House, Xi is expected to visit Washington later this year.

Corn Price Action, Charts

SPEAKER_00 1:09

Another market moving truth social post from the president, the Soybean market rallied upon seeing this. He said this yesterday. My meeting with the highly respected president of China, President Xi Jinping, which was originally postponed due to our military operation in Iran, has been rescheduled and will take place in Beijing on May 14th and 15th. First Lady Melania and I will also host President Xi and Madam Peng for a reciprocal visit in Mar in Washington, D.C. at a later date this year. Our representatives are finalizing preparations for these historic visits. I look very much forward to spending time with President Xi in what will be, I am sure, a monumental event. I love how he signs all his uh his little notes. Thank you for your attention to this matter, President Donald J. Trump. Um, so the soybean market rallied on this. Trump had it was it was a positive, the the message had a positive tone to it. But to go back to soybean fundamentals, the the bean market rallied on this, right? Okay. Old crop soybean purchases. China has bought um officially, we're gonna get a new number this morning, but it's officially just south of 11 million metric tons. They were supposed to buy 12. Some people have said they've bought 12. Maybe they did, but the official number from USDA is just under 11. China has made, um, I'm not gonna say they've made it clear, but in so many words, they've kind of said we're not doing more old crop U.S. soybeans. Um, they used that phrase in the Reuters piece. It was uh non-soybean row crops, is what they may be interested in uh for maybe the remainder of this marketing year. So I don't know, I don't know exactly what the trade is optimistic about. Now, China has bought approximately zero, zero bushels of U.S. soybeans for new crop delivery. That's 26, 27 marketing year for delivery after September 1st. China has acknowledged and referenced the idea that they that they may and could buy 25 million metric tons of U.S. soybeans each year for the next three years, but we haven't seen them start. And um, if they're gonna hit that sort of total, they probably need to start like pretty soon. So the market's optimistic about the whole China deal. Um, I don't know that I'm personally optimistic about additional old crop sales to China. I'd love to see them. Doesn't make any sense for them financially. Brazil's a whole hell of a lot cheaper. Uh new crop could make sense. I haven't looked a ton at the new crop um uh economics, but U.S. soybeans are usually competitive for a window uh post-U.S. harvest. So uh beans, rally yesterday on that news.

SPEAKER_01 3:30

Corn futures moved higher yesterday with the May 26th contract gaining nearly five cents to settle near 467 per bushel, supported by expectations that rising fertilizer and fuel costs could cause farmers to plant fewer corn acres. Soybean futures were sharply higher, with the May contract climbing roughly 17 cents to close near 1172 per bushel. As we just stated, the rally was fueled by confirmation that Trump will visit China in mid-May. Uh wheat futures also advanced. The May Chicago wheat contract gained about eight cents to settle near 598 per bushel, while the May Kansas City wheat contract rose nearly 14 cents to close around 618 per bushel.

E15

SPEAKER_00 4:07

Let us take this opportunity to look at some charts. Here's these 26 corn. Uh, you could very easily trade up to those previous highs. Uh 498.5 is the existing high right now that was posted two weeks ago, I think. So I wonder if there is a wall of farmer sell orders at and around that$5 level, which is a big psychological number. It's probably kind of a goal type price for a lot of farmers looking to price new crop grain. Look at this one. D'27 corn posted fresh highs yesterday and again overnight. I can't help but wonder if this is where the fertilizer concern, especially as it relates to U.S. production, should be reflected. We're going to talk about fertilizer and who has what bought here in a second. But um a lot of people think that perhaps it's the 2027 U.S. corn crop that will be impacted by the fertilizer situation and nitrogen pricing in particular as it relates to the whole Iran thing and supply disruptions. May soybeans um acted better yesterday. As I mentioned, we rallied on the Trump G news. You got a long ways to go to get back to those highs up at 1238. Um, but it's possible. It's possible. There definitely appears to be some upside momentum in the ag markets. Here's Nove beans, they look better by comparison. And uh, I wouldn't be shocked if you went up another 25 cents and posted some fresh highs. Uh, it doesn't look that far away. July, Kansas City wheat, you've got kind of like a wedge pattern in place. If we could close or trade above 645 today in that July HRW contract, this thing would look a whole hell of a lot better.

SPEAKER_01 5:34

The Trump administration will allow expanded summer sales of E-15. On Wednesday, the EPA issued emergency waivers temporarily exempting E-15 from federal volatility restrictions with the measure in effect from May 1st through May 20th. The move comes as the conflict in the Middle East has disrupted oil flows through the Strait of Hormuz, driving fuel prices higher. Biofuel industry groups support the measure, but continue to advocate for a permanent legislative solution to allow year-round nationwide E-15 sales. As of Wednesday, the national average price for gasoline stood at$398 per gallon, and diesel averaged$536.

Rollins and Fertilizer

SPEAKER_00 6:10

Here's Lee Zeldon on X. I just signed and announced a nationwide E-15 and E10 fuel waiver to fortify U.S. fuel supply. This waiver ensures a robustly available supply of domestic fuel, providing Americans further relief at the pumps and reducing our reliance on foreign oil. This means lower energy costs for all Americans, fulfilling President Trump's day one executive orders. What's kind of disappointing about this is that Congress has failed at pretty much every turn to get year-round E-15 legislation pushed through on a permanent basis. So what we've got here is another temporary measure. It's only through May 20th, and they'll probably extend that if this uh high gas price thing sticks around for a while. I need to clarify and provide some detail into something I said yesterday. So I talked about how U.S. ethanol production capacity is we're pretty much grinding corner capacity. And let me give you some details on this. U.S. ethanol production capacity, according to EIA data, is about 18.4 billion gallons per year. That was utilized last year at roughly 90%. That is a very high rate of utilization historically. The real world maximum utilization rate is probably 93-ish percent, given that you've got plant maintenance alone, which typically knocks several percentage points off of total capacity each year. You've also got unplanned downtime due to weather disruptions, logistics, those things are all inevitable every single year. So long story short, we are almost grinding corn at capacity in the United States. And it's not unfair to say that uh generally speaking, we are grinding corn at capacity. There is perhaps some slight room for improvement. Now, a lot of the ethanol plants out there, when they were built, they were built with the idea that we could expand in in the future. So they were built with like plans for, you know, here's an expansion plan for this plant if the right things happen, you know. But the right things haven't happened yet because these uh measures that um the president in this case has taken and the EPA has taken, it's not permanent. And it's not, I don't know that this is going to convince anybody that we need to expand ethanol production capacity. What we need is Congress to push through a permanent uh year-round E15 legislation type deal. And that's how you would increase capacity, I think, on a larger and broader scale.

SPEAKER_01 8:22

Ag Secretary Brooke Rollins believes high fertilizer prices are unlikely to significantly affect U.S. farmers. In an interview on Fox Business, she noted that about 80% of farmers purchased their fertilizer last year for the upcoming planting season. Because of this, the impact on most farmers should be minimal. Fertilizer prices have surged since the Middle East conflict began. Uh, for the roughly 20% of farmers who have not yet secured supplies, Rollins said the Trump administration has taken steps to ease costs, including relaxing restrictions on petrochemical imports from Venezuela and issuing a 60-day waiver of the Jones Act.

SPEAKER_00 9:01

So Rollin says 20% of farmers don't have fertilizer locked up, is what she said.

SPEAKER_01 9:06

Yes.

SPEAKER_00 9:07

We we received, and it wasn't meant to be a compliment, but we received an incredible compliment, I believe, on YouTube yesterday, because I said it was either yesterday or two days ago. I think I said something like, you know, I think the majority of U.S. corn growers had their fertilizer needs bought. And somebody said, No, Joe, you're basing that on your premium subscribers, and they're more advanced than the average farmer. So if you want to be more advanced than the average farmer, you better sign up for the premium deal today. In any case, I don't um, I'm hearing conflicting things with regard to who's got nitrogen bought and who doesn't. It seems to be very much regional. I think there's a lot of people in the call it Western Corn Belt, um, especially like the Dakotas that didn't get stuff locked up. But then you go to the central corn belt, and uh it seems like a lot of the nitrogen needs were locked up. So it's it's very much a big question. We've got an acreage report next week, and we're gonna get into that in a little bit more detail the next couple of days. Uh the average trade guess ahead of that report for corn acreage is 94.4, I think, which would be off more than 4 million from last year. I don't think it's gonna be that low personally, but again, March 31st, that number, it's it's useless and meaningless. And uh we'll trade it, but it's not gonna be accurate.

SPEAKER_01 10:12

If you guys haven't checked out our premium content, you sure need to do so. Joe, can you tell our viewers about some of our recent premium videos?

DEI Funding Pulled

SPEAKER_00 10:18

Matt Bennett was on yesterday for a 20 questions segment in these videos. We take questions from our premium crowd and we answer them. Uh, questions about grain marketing, basis spreads, all that stuff. Uh Matt and I have some very different opinions on the concept of reowning a grain sales and uh a little bit of conflict and healthy debate is always it's always good. And uh that's what we did a little bit of yesterday. That was just a very small piece of what we did. Pete Meyer was on um earlier this week. What do Pete's fund friends think? Uh Pete used to work with the funds as an analyst and um in his in his prior career and still keeps in touch with a lot of these guys. And how how are they how are the funds thinking about this situation with Iran, with fertilizer, with a possible inflation event? Um, I just had a Bloomberg article hit my phone here. Uh, US inflation seen at 4.2% by the end of the year. That would be a uh pretty phenomenal spike in inflation. How are the how are the funds thinking about this? Uh that's what Pete kind of explained to us, uh, among other things. If you want to see the premium stuff, go to standardgrain.com. You can sign up this morning. This is a$50 per month subscription. You could cancel at any time. No other fee, no other obligation, nobody will try to sell you anything else. If you want to be one of the more advanced farmers that uh is in the know with regard to everything, you should sign up.

SPEAKER_01 11:30

Uh the USDA is canceling roughly$300 million in funding allocated to the increasing land, capital, and market access program. The initiative was designed to support beginning and underserved farmers, including Black, Indigenous, immigrant farmers, and veterans. The goal of the program was to improve access to land, capital, markets, and succession planning. 49 out of the 50 projects funded through the program will now be terminated. The USDA said the decision was driven by concerns over DEI-related discriminatory preferences and inefficient use of taxpayer dollars.

Ethanol Production

SPEAKER_00 12:05

I have no opinions on DEI for the purposes of this show. If you have opinions on DEI, just keep them to yourselves because you're not helping anybody by uh ruining our comment section. I will say this, and I wanted to throw a couple statistics out there. U.S. average farm values were about 4350 per acre in 2025. Now, of course, prime ground in the central cornbell is much more expensive, but that 4350 number includes pasture land. It includes, quote, fringe areas, that sort of thing.$300 million, if you were to allocate it all to land at that price,$4,350, it's about$69,000 acres. Is that the end of the world if um there were$69,000 acres just uh given away by the government? I don't know. I mean, it's it's substantial, and it would be particularly upsetting if, say, you were trying to buy a piece of piece of farm ground, you know, in your neighborhood, but somebody got a bunch of government money, some DEI cash and was able to buy it. I don't know. But um, in any case, uh DEI is is dead under this president for the most part. And it could make a comeback someday, you know.

SPEAKER_01 13:02

Uh U.S. ethanol production improved last week. Weekly output was reported at 1.12 million barrels per day, up 2.1% compared to the prior week and up 1% versus the same week last year. Ethanol stocks climbed to 27.17 million barrels. The print was up 2.9% compared to the previous week and up 2.2% compared to the same week last year. According to Reuters data, U.S. ethanol margins improved across the corn belt over the last week, now ranging from 10 cents to 35 cents positive.

SPEAKER_00 13:30

Yeah, margins are good. Um, that I believe is a seasonal record print by a small margin. Um, we are not quite grinding corn at the pace needed to hit the USDA uh corn for ethanol target, but I think we're we're close enough and they're not gonna make any big changes anytime soon. I don't think stocks are too high, uh, but we are still exporting a lot of ethanol. I'd like to see that number draw down just a little bit. It typically does draw down seasonally once you start to get into uh call it driving season in like May and June. What did cattle do yesterday?

SPEAKER_01 14:00

Uh cattle futures were mostly lower. Live cattle were 20 cents to 95 cents lower, with the exception of the August 27 contract, which gained a mere five cents. Feeders saw losses ranging from 65 cents down to a buck 77, with the exception of the front month contract, which gained a buck fifty-seven. Box beef price, box beef prices were sharply lower. Choice was down 822 at 391.69. However, select rose 99 cents to 395.49.

SPEAKER_00 14:25

Stock market's off a little bit this morning. The SP's down 41 points. That's six tenths of a percentage point. Treasury's off a little bit. US dollar's about flat. Crude oil is higher this morning. It's up 255 in the May WTI 92.87. Gold and silver are off and off sharply in the case of silver, down 5.8%. Uh have a great day, guys. We'll be back Friday.