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What Does Trump’s Win Mean for Agriculture?

Election 2024 Rundown

Donald Trump stunned political observers on November 5 with an overwhelming victory. The former President reversed results from the 2020 election by winning all seven of the key battleground states, including the so-called “Blue Wall” of Wisconsin, Michigan, and Pennsylvania. While Kamala Harris underperformed with certain voter demographics, Trump expanded his overall support and is on track to win the popular vote by a significant margin.

What does Trump’s victory mean for farmers and the issues they face in the current marketplace?

Initially, we all need to watch who Trump puts into his cabinet to oversee the departments of agriculture, trade and energy. Particularly for agriculture, will Trump select a more traditional secretary that is familiar to the industry or someone who is an outside-the-box choice like a Robert Kennedy Jr.? This decision will greatly impact agriculture policy during his administration. On the trade front, expect similar policies as we saw in Trump’s first administration, when he challenged norms and pursued bi-lateral trade agreements. As for energy, on the campaign trail Trump spoke frequently about maximizing the U.S.’s energy production capabilities, driving down fuel prices for consumers and reversing policies like mandates on electric vehicles. Expect that to be a focus during his first 100 days in office, along with looking to address immigration policy and the southern border.

In Congress, the Republicans took control of the Senate, and we are waiting to see if they retain control of the House of Representatives. In addition to potential focus on energy and immigration policy in the first 100 days, Congress will also be looking to address tax policy in 2025. As for prospects of the Farm Bill, we’ll need to watch who ends up with control of the House. Republicans controlling the White House and both chambers of Congress will change the calculation on Fam Bill negotiations and the likelihood of a clean extension for 1 or 2 years, or a bill with policy changes. Either way, we retain advocates for Illinois agriculture in Congress on both sides of the aisle. All incumbents in our delegation won their election, including House Agriculture Committee members Rep. Eric Sorensen and Nikki Budzinski who won competitive races. Also worth noting, the sponsor of the Next Generation Fuels Act, Rep. Mariannette Miller-Meeks (R-Iowa) has declared victory in her election; however, the race is not officially called yet. The vote totals are Miller-Meeks has 203,899 votes, and challenger Christina Bohannon has 203,486 votes.

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Agricultural Market Update: Grain Prices, Crop Conditions, and Weather Impacts

Welcome back to our channel where we provide comprehensive updates on the latest trends and changes in the agricultural sector. This week, we're looking at significant movements in grain prices, crop conditions, and the effects of weather patterns. Let's dive into the details:

Grain Price Decline Grain prices have fallen to their lowest levels since 2020, with December corn down 4.3% and November soybeans losing 3.1%. This decline is partly due to the beneficial moisture brought by Hurricane Beryl to the Midwest, which has improved crop conditions significantly. The USDA reported that corn and soybean crops are in their best condition in four years, contributing to the downward pressure on prices.

Record Short Positions and Market Sentiment Fund traders have increased their net short positions in the corn market to a record level, with a net short of 347,000 contracts of corn. This reflects a bearish sentiment in the market, further influencing grain price dynamics. Similar selling trends were observed in soybeans and SRW wheat, indicating broad market caution.

Weather Impact and Forecast Hurricane Beryl has brought significant rainfall across Arkansas, Missouri, western Tennessee, western Kentucky, and southern Illinois, with more expected over Missouri, Illinois, and Indiana in the coming days. Despite this, the market is currently more focused on the moisture benefits rather than potential heat risks forecasted in the 6-10 and 8-14 day periods.

US Crop Conditions Corn and soybean conditions have shown slight improvements last week, with corn rated 68% good to excellent and soybeans at 68%. These are among the best ratings for this time of year since 2020, suggesting robust crop health that could continue to influence grain prices.

Winter Wheat Harvest and Spring Wheat Conditions The US winter wheat harvest is progressing well, ahead of schedule with significant portions already harvested in Kansas and Texas. Spring wheat conditions are also favorable, with 75% rated good to excellent, although there have been some declines in states like Idaho, South Dakota, and Washington. Brazil's Corn Harvest and US Exports Brazil's second corn crop harvest is advancing rapidly due to favorable hot and dry conditions, with 63% of the crop already harvested. Meanwhile, US corn shipments saw a substantial increase last week, indicating strong export demand, which contrasts with the recent drop in domestic grain prices.

Ongoing Developments Lastly, the USDA reported a flash sale of corn, with significant quantities sold to unknown destinations, scheduled for delivery over the next two marketing years. This could signal ongoing international demand for US corn despite lower prices.

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