After selling off early in the week with the implementation of tariffs, the markets rebounded to end the week unchanged on news the tariffs were being delayed. May, July and December futures all ended the week unchanged following the funds buying more than 50,000 corn contracts on Thursday and Friday. The funds net long position did drop below 200,000 contracts early in the week but ended the week long 251,844 contracts of corn and long 475 soybean contracts.
On Thursday President Trump suspended the 25% tariffs he had imposed earlier in the week on most goods from Canada and Mexico, the latest twist in a fluctuating trade policy that has whipsawed markets and fanned worries about inflation and growth. The exemptions for the two largest U.S. trading partners, expire on April 2, when Trump has threatened to impose a global regime of reciprocal tariffs on all U.S. trading partners.
In response, Canada has delayed a planned second wave of retaliatory tariffs on $125 billion of US products until April 2. Mexican President Claudia Sheinbaum has not implemented any reciprocal tariffs on the US as she continues to negotiate with the US.
20% tariffs do remain in place for goods from China as the two countries have yet to negotiate following Tuesday’s implementation. China implemented a 15% tariff on Corn and Wheat from the US and a 10% tariff on soybeans from the US.
Crop conditions in South America continue to improve with recent rainfalls. The first 5 days of March have already brought half the months average rainfall and temperatures are projected to stay mild through mid-month. This is a significant turnaround from the dry January and early February they experienced. Planting progress of Brazil’s second crop is ahead of the five-year average setting the stage for a potentially large crop.
These tariffs and other items are all fluid and there are no publicly announced thresholds that countries like China, Mexico, or Canada can go by to understand when the tariffs will be lifted or under what conditions. We have to assume that is what is being discussed when the leaders are talking with each other. It appears that the US has plenty of wiggle room and is willing to negotiate. The toughest part of the on and off talk is the inability of the market to have any solid direction. We have been in the “Risk Off” mode more recently and could stay that way until these tariffs are clear or in place.
Tariffs or not, seasonally the markets trade lower in early March before bouncing heading into April and the US planting season. The graph below illustrates where July futures have traded over the last 10 years. May, September and December graphs would all show similar patterns.
Upcoming reports
| Date | Report |
| 3/11/2025 | Crop Production |
| 3/31/2025 | Grain Stocks/Prospective Plantings |
