Posted on April, 21, 2025 at 11:44 am
KANSAS CITY, MISSOURI, US — Data from the US Department of Agriculture’s (USDA) March 31 Prospective Plantings report indicated more acres planted to corn and fewer acres to wheat and soybeans in 2025.
In markets, the projections were quickly overshadowed by uncertainty and ever-changing US tariffs on nearly all imported goods, including commodities, plus retaliatory tariffs imposed by several countries on imports of US goods and US port fees on Chinese-made vessels. Tariffs and port fees may eclipse weather as the greatest unknowns in this year’s market.
Even though tariffs are the major price-moving and unsettling factor in nearly all markets (especially equities and crude oil), they’ve so far shown a tendency to be changed at a moment’s notice. As of this writing, tariff conditions with the three largest US trading partners — Mexico, Canada and China — are vastly different. Goods and commodities covered under the United States-Mexico-Canada Agreement (USMCA) remain exempt, although a potential 25% tariff on US imports from both countries remains a possibility. Meanwhile, tariffs have surged between the United States and China, the largest buyer of US soybeans.
Old-crop corn holds up well
Amid near-constant uncertainty surrounding financial and commodity markets since the White House’s April 2 announcement of a universal 10% tariff increase and higher individualized “retaliatory” tariffs (most since paused for 90 days) for more than 50 countries, a winner of sorts has emerged in grains: old-crop corn.
Resisting tariff winds, the CME Group May and July futures contracts have crept higher since then, with May settling at $4.69 per bushel and July at $4.74¾ at the end of trading April 8. Much of that has been driven by the White House’s somewhat surprising decision to spare — at least for now — top US corn-importer Mexico from any additional levies, meaning corn trade to the south remains tariff-free under the USMCA, which President Donald Trump negotiated during his first term.
“With old-crop corn, the interesting thing with these tariffs so far is if you look at prices, we’re kind of flat to higher since April 2,” said Patrick Sparks, vice president of Global Risk Management. “I think corn is feeling a little bit unscathed from these tariffs. It’s clearly a developing situation. The biggest thing there is Mexico being spared under the USMCA, and them being our biggest corn export customer.”
In its March 31 Grain Stocks report, the USDA estimated corn stocks in all positions as of March 1 at 8.151 billion bushels, down 2% from the year prior.
“So with the old crop, we’re not exactly in a state of oversupply,” Sparks explained.
Source: World Grain