[PAUL YEAGER] Coming up on Market to Market.

Oil tops the century mark on new threats.

Businesses navigate new tariffs between old trading partners, getting the cattle herd protection from the gray wolf and commodity market analysis with Matt Bennett, next.

♪♪ [ANNOUNCER] I wouldn't be here without my customers.

Yeah, I'd like to thank the customers.

They're very dear to our hearts.

It's about the people that you're working with and the relationships that you have.

Thank you.

Thank you.

Thank you.

Thank you from the bottom of my heart.

♪♪ [ANNOUNCER] Family owned and operated for more than 60 years.

Sukup Manufacturing is a full-service provider of grain handling, storage and drying equipment, helping farmers feed and fuel the world.

[ANNOUNCER] Support for Market to Market has been provided by a bequest from Philip Lietz of Alta, Iowa, in recognition of public television's commitment to agricultural programming.

♪♪ [ANNOUNCER] Market to Market is made possible in part by a grant from the Corporation for Public Broadcasting.

This is the Friday, September 11th edition of Market to Market, the weekly Journal of Rural America.

[YEAGER] Hello, I'm Paul Yeager, the 30 year home loan hit its highest rate in 14 months this week at 6.76%, according to Freddie Mac.

That's 4/10 of a percent above one year ago.

The August existing home market reflected the increased borrowing costs as sales were at the lowest level since June of 2025.

Wholesale inflation added 4/10 of a percent in August, as the price of energy surged due to the war with Iran.

Consumer prices were also up on the renewed fighting in the Middle East.

The monthly rate expanded by 4/10 of a percent, AAA reported diesel fuel hit an all-time high of $6.05, and it's the first time a gallon has gone past $6.

Crude oil isn't the only factor driving the price of gas or diesel.

The U.S.

Energy Information Administration says the cost of crude accounts for roughly 55% of the price of gasoline, and 46% of the price at the pump for diesel.

The last time crude topped the century mark was May of this year, Peter Tubbs looks at the impact these prices are having on rural America.

[NARRATOR] This week, crude oil prices shot past the $100 mark as traders grew concerned that the war between the United States, Israel and Iran has escalated.

The price of crude oil has risen over 30% across the last dozen trading days.

The resulting spike in fuel prices has pushed retail gasoline to an average of $4.22 nationally, while diesel is rapidly approaching $6 per gallon, a 58% rise since the start of the war.

The increased input costs are pinching farmers budgets.

[ERNIE GOSS] The rural Main Street economy that is really being hurt by the farmers ability, for example, to buy equipment, farm equipment sales are down.

We've recorded it for 36 straight months.

Peter, for agricultural equipment sales are down and that's.

I don't see any real turnaround any time soon.

[NARRATOR] The jump in energy prices is also pushing up inflation for global consumers, which along with reciprocal tariffs, is affecting the volumes of U.S.

Exports.

[ERNIE GOSS] We produce far too much manufactured goods, agricultural goods for the domestic economy, we have to sell abroad.

And so, when you start talking about energy, you're talking about the global economy.

And that's what we're seeing $100 a barrel.

WTI, West Texas Intermediate, that's way outside the boundary of what it would be without the interruption with the war on.

And it really has an outsized impact on agriculture and manufacturing.

[NARRATOR] Renewable fuels are in a sector that benefits from higher crude prices.

Ethanol becomes a profit center when oil is expensive.

[ERNIE GOSS] When the price of oil and gasoline gets higher, that supports ethanol, you can increase the price of ethanol.

So, there are some good factors to come out of that.

Good impacts, I should say, coming out of that, but it's far outweighed by the losses in terms of the grain, the higher grain prices for beef producers, higher grain prices for the hog, the pork producers, all that.

[NARRATOR] For Market to Market.

I'm Peter Tubbs.

[YEAGER] Tensions flared in the trade war this week after Canada slapped $20 billion worth of retaliatory tariffs on U.S.

Goods.

The duties amount to roughly 6% of the more than $333 billion in goods exported north of the border last year.

Laura Bauer has more on how the new duties are affecting U.S.

Dairy producers.

[NARRATOR] The U.S.

Economy is roughly 13 times larger than Canada's, and more than 70% of Canadian export goods had South.

For northeast dairy farmers like Matteo Keeler, Canada is a critical market.

[MATEO KEHLER] I'm the co-founder of Jasper Hill Farm with my brother Andy.

We started this business milking cows and making farmstead cheese.

23 years ago in Greensboro, Vermont.

Here in the Northeast Kingdom, right on the Canadian border.

[NARRATOR] This week's Counter-tariffs included 25% duty on U.S.

Cheese and a 50% charge on certain milk, cream and whey products.

These duties could reduce demand for U.S.

Dairy products, causing a surplus of supply that would force American producers and processors to seek alternative markets.

[MATEO KEHLER] You know, February of last year, when the first round of tariffs were announced, our purchase orders went from absolute gangbusters.

After an incredible holiday season to zero, like zero cases of cheese.

Ordered exports represent about seven 8% of our business historically.

And this year it's a big old donut.

[NARRATOR] American dairy farmers have been operating on tight margins for years, and their costs of production consistently outpaces the low prices they receive for their milk.

[MATEO KEHLER] We've been able to pivot and build our sales in the U.S.

Last year was the worst year we've ever had.

This year is turning out to be okay, but we're dealing with a crazy amount of inflation for the input side of our business.

Now we milk 200 cows.

The price of diesel, the price of fertilizer on the packaging side, you know, a lot of our corrugate comes from Canada or from raw materials that are produced in Canada.

And those are all being tariffed.

Again, the underlying costs of doing what we do day in and day out are just escalating.

[NARRATOR] The Trump administration touts the tariffs as the way to ensure a level playing field for the nation's farmers and protect American production.

[MATEO KEHLER] The Trump administration's policies have absolutely punished farmers up and down.

Doesn't matter what you know, your commodity might be just absolutely disastrous.

[NARRATOR] In response to the newly imposed Canadian tariffs, the Trump administration plans to ban imports of some dairy products, motorcycles and a list of alcoholic beverages.

The trade war and talk of making the country the 51st state have only served to fuel anger in Canada, prompting boycotts of U.S.

Goods and a reduction in tourism.

[MATEO KEHLER] And we need Republicans to grow a spine and stand up to the insanity of the economic policies that we're all dealing with.

This is, you know, way beyond whether or not you're a Democrat or a Republican.

These tariffs are affecting everybody.

There are no winners here.

[NARRATOR] For Market to Market.

I'm Laurel Bauer.

[YEAGER] For over a century now, the federal government has played a role in managing wolf populations starting in the early 1900s.

Decades of predator control programs resulted in the elimination of wolves in the lower 48 states.

By the 1960s, though, except for northeast Minnesota.

Now federal protections arrived in the 1970s under the Endangered Species Act, gray wolves were listed, reintroduced, and eventually delisted in the northern Rocky Mountains due to recovery.

Last week, a cattle producer from Washington state was inside the Oval Office when President Trump signed an executive order that might delist certain wolf species across the country.

Our Mountain West bureau chief, Tammy Scardino, has more.

[NARRATOR] Part of the Supporting America's Ranchers executive order, signed last week, focuses on giving ranchers a freer hand to combat wolf attacks on their cattle herds.

The order gives the Secretary of the interior 90 days to determine if gray wolves can be downlisted or delisted from protection under the Endangered Species Act or ESA.

Nathan Knapp, a partner with the diamond M ranch located in northeastern Washington state, was in the Oval Office for the signing ceremony.

Knapp claims hundreds of family ranches in the region have folded because of Canadian gray wolf attacks on their cattle herds.

The eastern third of Washington state, where Knapp lives, is within the legal boundaries of an area where gray wolves have been removed from the ESA.

[MATHAN KNAPP] In our region, we are federally delisted, and the state of Washington has fought us tooth and nail and won't allow your guys' team to come in.

[NARRATOR] The current policy in Washington state is that a wolf can only be killed if you catch it in the act of attacking or chasing livestock, with a limit of one wolf per incident to help combat wolf attacks on Evergreen State cattle herds, ranchers can take advantage of the Range Riding Grant program, funded by the Washington State Department of Agriculture.

Local nonprofit agencies are paid to deploy non-lethal deterrents to discourage wolves and other predators from killing livestock.

[SCOTT NIELSEN] I think we do it well and effectively, but, you know, the budgets are budgets are getting cut.

[NARRATOR] Ranchers allow range riders onto their property to help monitor livestock tech, game cameras and remove dead animals to reduce the risk of attracting predators, Nielsen, a rancher and range rider, says their presence is ineffective in areas where attacks are occurring without consequences for the problem.

Wolves.

[SCOTT NIELSEN] I think the wolves should be being managed different in areas like this.

If they're not, and they're just going to be allowed to eat people's cows, I don't see why they would move on.

And, you know, to me, I think that's part of what's happening.

I think that wolves need dispersed throughout the state.

[NARRATOR] The debate between ranchers, wildlife advocates and the state has been heated and contentious.

Officials with the nonprofit Washington Wildlife First do agree with ranchers on a few points, including the state policy on targeting wolves that are caught in the act.

However, they want ranchers to increase supervision of their cattle grazing on public lands, particularly in places where wolf attacks are common.

Washington Wildlife First officials would also like to see the state increase their response times to incidents and use more non-lethal deterrents to discourage those attacks.

[DR.

FRANCISCO SANTIAGO-AVILA] We all know that ranching is difficult work, that individual losses can be upsetting.

We also don't oppose ranchers receiving technical assistance, receiving compensation for their verified losses.

You know, the amount of scientific literature that this protocol is based on is thin at best.

[NARRATOR] For Market to Market.

I'm Tammy Scardino.

[ANNOUNCER] Next, the Market to Market report.

[YEAGER] The WASDE and Crop Production reports prompted vastly different and immediate reactions in the markets.

USDA lowering the size of the corn crop was one of the headlines for the trading week ending September 11th.

The nearby wheat contract fell $0.09 and the December corn contract was $0.07 lower.

Increased yield predictions drove the soy complex down.

In the post report trade Friday.

The November soybean contract sold off $0.13 and December meal lost 230 per ton.

December cotton weakened $0.27 per hundredweight.

October class three milk futures declined by $0.20.

The livestock complex was mixed.

October cattle gained 673.

October feeders put on 1235 and the October lean hog contract fell by $0.77.

In the currency markets, U.S.

Dollar index was even October.

Crude oil surged again by nearly 10%, or $8.66 per barrel.

Comex gold shed 62.

20 per ounce and the Goldman Sachs Commodity Index added more than 33 points to settle at seven 7025.

Here now to lend us his insight on these and other trends as regular market analyst Matt Bennett.

Hello, sir.

[MATT BENNETT] Hey, Paul.

[YEAGER] Let's do this report headline off the top.

If we could.

The way it looked from my seat.

Yes.

Smaller corn crop, not as small as what the trade had been thinking, but that been.

What's the headline to you?

[MATT BENNETT] Well, I mean, you look at bean acres going up just a shade first of all, and then production up 0.1.

I mean, in all honesty, Paul, you had to expect that you would go up maybe a little bit from August, given the August weather.

Okay.

The thing that is the headline for me, I think moving forward though, is we planted 5.8 million more acres of soybeans this year.

You know, and you, you took care out from 3.25 down to 3.10.

And to me, that tells you moving forward.

Yes, you've got enough beans to get by for the time being.

We know that these exports have been incredible.

We're estimating China's maybe halfway there to that 25 million metric ton.

So that's been really good.

That's been a good thing for us.

But I think moving forward, you got to ask, where are the acres going to come from next year.

I think you need more bean acres, but I don't know where you're going to find them.

[YEAGER] Well, are you going to find them in wheat at the prices that we've been having here?

[MATT BENNETT] I mean, when KC last week, KC wheat goes to 8.60.

Chicago soft red July goes to 8.06.

You've got to assume I mean, I know there was hedging done there.

First of all.

Second of all, even right here pushing 7.50 on Chicago, that's a heck of a lot better than what we've seen the last couple three years.

And so yes, wheat acres were down significantly.

We've just continued to lose them.

I think you're going to pick up anywhere from one and a half to 3 million acres for next year.

[YEAGER] That sounds like price did its job to incentivize the acres so long term.

If I'm sitting with some stock right now, I'm still looking at Black Sea headlines trying to decide what do I do?

Am I selling right now with what wheat I have left?

[MATT BENNETT] I mean, it all depends on what percentage you have left.

But by all means, if you have a large percentage, we've seen the wheat market do wheat market things before, and I would be very cautious as to sit on too many bushels.

These are great prices.

Could it get even more exciting?

Absolutely.

No question about it.

But I still am a big fan of whenever you have a rally step in and rewarding that rally.

[YEAGER] How many people rewarded that corn rally last week?

[MATT BENNETT] You know, I do think there was people that were coming into harvest, went out.

And just from our conversations, saw what they had coming and decided to step forward with a few more sales.

One thing that I saw that I really liked is that there was a little bit of hedging of risk on 27, as people were buying fertilizer.

It's a drum that I beat every year, but this year's ratio of corn to fertilizer is a heck of a lot better than what it was a year ago.

Yes, fertilizer is still high, but that was a good reason for people to step in and hedge off risk.

[YEAGER] I think people know what you want to talk about or do talk about in the past, because our questions line up with a lot of the drum beats that you hit when you're here.

Let's talk December corn for a minute on the crop size.

So, there's been this theory for the last 4 to 6 weeks that this crop is smaller markets maybe been trading that it's smaller than what USDA thinks it is.

Where do you think it is?

[MATT BENNETT] I mean, the average trade guess was one 78.5.

That's where it came in one 78.5.

I do think last month's pro farmer tour being seven bushel below USDA.

That made the trade automatically think, hey, we're definitely going to a sub 10% stocks to use ratio.

And that's why we got the demand rationing rally you typically get with a sub ten.

It already occurred for the.

I'm not saying we're not going to go even higher, but that's essentially what has happened here.

I do believe the trade was probably trading something a little lower than where we were.

But the initial reaction was positive for the report.

Paul, part of the reason for the initial reaction being positive is that it is a supportive in nature situation that you're drawing any stocks down another 90 million bushels, first of all.

Second of all, you're looking out into the future, wondering once again where are the acres going to come from?

[YEAGER] Let's go back to that statement about initially because yeah, initially it was green.

Then all of a sudden it went red.

What happened?

What changed?

[MATT BENNETT] Beans are down $0.30.

[YEAGER] Well, we know that part.

But I mean is that was that the spillover for corn.

[MATT BENNETT] I think that that that was part of it.

That and clearly a lot of folks yesterday came into this, bought it probably some short term profit taking.

In all honesty, the market has been elevated versus, you know, recent months.

In all honesty, I don't necessarily see this corn market as being too high or too low right now.

I feel like you came into some sort of an equilibrium.

You're going into the weekend, but long term, Paul, I do think there's reasons to be very supportive here.

I don't know that I want to say bullish because that to me gets people to where they don't want to sell anything, you know, and so I'm supportive this market.

But at the same time, I'm rewarding it on rallies.

[YEAGER] Real quick before we depart.

There was a storm that rolled through at least this part.

And I saw a couple of pictures of empty grain bins, and people were having flashbacks to 2020.

Is there maybe not as much corn on the farm as we thought?

[MATT BENNETT] That's the thing, is that basis levels have gotten a whole lot better, and a lot of places other than still in the, you know, the Dakotas, for instance, some of those basis levels haven't looked all that great.

But you've had basis actually appreciate here the ending of the marketing year being so strong on export sales, that certainly contributed to it.

And we saw that in the report going up another 25 million bushel.

[YEAGER] Well, let's talk about storage if we could.

Paul in Illinois wants to know, Matt.

He has limited on farm storage.

Should I put corn or beans in the bin?

[MATT BENNETT] Most farmers like putting corn in the bin.

First of all, we all know that if you have a bin storage system that you can keep the moisture content for beans, you know, around 13% not lose.

I'd be okay storing some.

But personally, I really like store and corn.

I do think corn's got a story moving forward.

Demand has been fantastic.

We know that.

Not to mention stocks to use ratio under 10% tells me that we're probably not done in running price, up enough to curb demand.

So yeah, I'm a big fan of storing corn.

[YEAGER] Do we have the harvest high in for beans right now?

[MATT BENNETT] I mean, you've got to assume that.

[YEAGER] I'm sorry, Pre-harvest we're about to start.

[MATT BENNETT] You've got you've got to assume that that potential exists.

Clearly, we're going to have a lot of hedge pressure coming forward.

In its historic that farmers will typically come in across the scale with beans they haven't sold yet and just sell them, especially with the price levels we're looking at, Paul.

So, I think there'll be a lot of hedge pressure here coming forward.

Now, there's a lot that can happen here.

We know this September 24th date.

President Trump and Xi meeting.

You know, if good news comes out of that or status quo.

Status quo has been pretty good, then you've got to assume that beans have a potential to go on up.

If you end up with weather issues in South America, this El Nino is still something that we have to keep an eye on.

It's the strongest one we've ever seen.

And so historically, it can cause production issues.

It doesn't every time.

But with it being this strong, you don't want to discount it.

[YEAGER] I know you didn't want to say bullish with corn.

Are you rosy on beans in 27?

[MATT BENNETT] Not as much relatively speaking.

Not as much so as on corn.

On corn.

I look at this.

Let's throw them together.

You had 183.5 million acres this year.

Okay.

If we gobble up a couple million of those, let's just say you even get it down to 180.

That's not enough for the two of them.

It just simply is not.

And so, I probably a little more friendly corn.

Part of it is just the farmer in me, if you will, but I do think you can.

You've got reason to have some optimism on both sides of things.

With that being said, we've already sold a little bit of 27.

Part of it is because, again, I can lock in really strong net income.

I haven't been able to do in the last 3 or 4 years on a small percentage, I think incrementally you've got to reward these types of markets.

[YEAGER] How are you feeling about the live cattle market right now?

I mean, it did rebound rebound this week a little bit.

[MATT BENNETT] Yeah.

I mean we're pushing almost $10 off the lows.

You know and I heard some folks say in 224 is getting passed up.

You know by you're probably going to be trading 225 to start the week.

No doubt that cash cattle trade has rebounded somewhat.

Feeders concern me.

They're very high priced.

We know that.

We haven't been able to get a deal on feeders in quite some time.

Those that are stepping out and buying them at the price levels that we're seeing, you know, they're stepping out on a pretty big limb of faith.

It's really tough to find black ink anywhere, especially if you're not walking the corn off the farm.

If you are, you've probably got a fighting chance, but you've got to be banking on these type fundamentals.

We all know they're there, that they're going to be able to get the funds interested in maybe pushing back somewhere close to the old highs that we saw, or at least a ten, $15 rally.

That's probably what you need to make these folks feel better.

But it's a gamble, boy.

[YEAGER] And you know, the news stories after story, is that contributing at all to this story, either in the live cattle or the feeder market?

[MATT BENNETT] Well, I mean, I feel like you broke the funds down at some point.

You know, food inflation is a big issue for this administration.

Clearly, you know, and they've thrown a lot of things at this beef situation.

I would say cattle market because the cattle market has definitely been impacted.

But trying to curb the price of beef.

And I think at some point you just lose interest and say, hey, at some point they're really going to throw something at this.

And that's why we saw funds exit cattle to an extent.

I mean, they're still long, but overall, you lose interest at some point.

I've been long for a long time.

We know that.

And fundamentals are still very bullish.

But you know what.

Whenever you have outside market influences trying to affect prices, you lose your appetite for keeping a position because it's unpredictable, even more so than normal.

[YEAGER] And in the hog market, the shorts look like they have the hold on it right now.

Is that right?

[MATT BENNETT] Yeah.

I mean, in all honesty, this hog market is just I mean, we've run up, then we've run back down.

I mean it over the long period.

It's actually been somewhat sideways.

But yeah, it doesn't look pretty in all honesty.

But it's tough.

This hog situation is still tough.

I think if cattle take off and go up, then I think that you'll see that substitution effect again.

I think hogs will stay fairly strong.

[YEAGER] The Illini win more games, the same amount of games or less games this year on the football field.

[MATT BENNETT] I mean, as a fan, I'm going to say the same amount of games I went to their initial game and it.

I was very concerned about certain aspects of the game.

But we're going to hold out hope that they're going to do pretty good again this year.

[YEAGER] All right.

Optimism continues for Matt Bennett.

Good to see you sir.

[MATT BENNETT] Absolutely.

[YEAGER] All right everyone.

You've been watching the analysis portion of our program.

In a moment we'll continue our discussion in an online only segment that we call Market Plus, which is available wherever you get your podcasts.

You can also go to our website at markettomarket.org to listen.

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Weigh in with your thoughts at facebook.com/markettomarketshow.

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Have a great week.

♪♪ [ANNOUNCER] Market to Market is a production of Iowa PBS, which is solely responsible for its content.

[ANNOUNCER] I wouldn't be here without my customers.

Yeah, I'd like to thank the customers.

They're very dear to our hearts.

It's about the people that you're working with and the relationships that you have.

Thank you, thank you, thank you.

Thank you from the bottom of my heart.

♪♪ [ANNOUNCER] Family owned and operated for more than 60 years, Sukup Manufacturing is a full-service provider of grain handling, storage and drying equipment, helping farmers feed and fuel the world.

♪♪ [ANNOUNCER] Support for Market to Market has been provided by a bequest from Philip Lietz of Alta, Iowa in recognition of public television's commitment to agricultural programing.

♪♪ [ANNOUNCER] Market to Market is made possible in part by a grant from the Corporation for Public Broadcasting.