Coming up on Market.

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Trade negotiations heat up around the world.

Hope for the decimated Florida citrus industry and commodity market analysis with Ted Seifried next.

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This is the Friday, February 7th edition of Market to Market, the Weekly journal of Rural America.

Hello, I'm Paul Yeager.

January has a history of showing less employment as seasonal holiday jobs disappear and winter keeps a blanket on construction.

However, the economy was able to add 143,000 positions last month, according to data released Friday.

This is the third consecutive month of gains over 100,000.

The Bureau of Labor Statistics reported hiring in health care, retail and government.

Those who want to work were able to find a job as the unemployment rate moved to 4%, down a 10th of a percent.

Average hourly wages increased by half a percent.

The Federal Reserve's action on interest rates will be the next talking point on the economy.

So is action on trade.

Tariff talk a week ago was heightened as action against Canada, Mexico and China loomed.

Then the Trump administration hit pause on two of the three sets of import duties.

Peter Tubbs reports A sweeping new tariff on Chinese goods is expected to raise consumer prices in the United States.

President Trump placed an additional 10% tariff on Chinese imports the day after he paused threatened tariffs on Canada and Mexico for 30 days.

China quickly announced retaliatory tariffs on imports from America, with a 15% duty on coal and liquefied natural gas and a 10% tariff on crude oil.

Agricultural machinery and large engine cars.

Those tariffs took effect on Monday, February 3rd.

China is trying to project itself not only as one of the biggest markets in the world, but also from the supply chain perspective.

It is one of the biggest manufacturers in many products, especially in the upstream.

So I think the combination of using the selected tariff export control and the restriction on market access to certain U.S. firms basically reflect that, China's, is trying to increase the sparkling chips and show the US that, is a capability, in terms of the negotiation process.

The Trump administration and China exchanged multiple rounds of tariffs during a 2018 tariff war.

Soybean producers took a large financial hit before negotiations restored those markets, and those producers received federal payments to help make them whole.

The new tariffs currently do not cover agricultural commodities from the United States.

President Trump quickly reversed tariff threats towards Canada and Mexico on Monday, when the two countries agreed to increase security measures along their respective borders.

The 30 day pause on new import duties will allow all sides to negotiate new terms, as well as giving businesses in all three countries a chance to stockpile parts and materials before the deadline.

The United States Mexico Canada Trade Agreement, the current treaty governing North American trade that was negotiated by the Trump administration and signed into law in 2019, is up for renegotiation in 2026.

Some critics see President Trump's current tariff move as the start of those negotiations.

If tariffs are placed on Canadian imports, it could become a pinch point for agriculture due to the potential for higher prices being placed on fertilizer.

The United States imports over 85% of its potash supply from Canada.

The cost of any tariffs products imported from other countries is paid by American importers and consumers from Market to Market I'm Peter Tubbs.

Imagine if 90% of the Midwest corn or soybean production was wiped out due to an unmanageable disease.

Florida citrus producers have faced this exact scenario, but now scientists are offering a glimmer of hope to the Sunshine State.

Colleen Bradford Krantz reports in our cover story.

Ron English had spent 35 years as production manager at his family's Florida citrus business when the state was hit by citrus greening, a disease that has ravaged Florida's iconic orange and grapefruit industry.

About 2015, we decided that gradient had hurt us enough to where we the quality of the fruit wasn't there and it when it hit us and hit us hard, it didn't gradually go out and all that we did try to what we knew to do to keep the trees alive didn't work.

So we made a decision just to shut our operation down.

My father in law and our family have been in since 1895.

Life changing decisions like this one have become common across Florida since citrus greening, also referred to as HLB, emerged in 2005.

Since that time, producers in the state have lost 63% of their citrus bearing acres, while some owners of those 429,000 acres of former groves switch to other forms of agriculture or kept the land others sold to developers.

We were able to sell, something that we didn't want to do, where we once have groves or subdivisions, strip centers, malls.

Citrus greening, caused by a bacteria spread by the tiny non-native Asian citrus psyllid, destroys orange grapefruit, tangerine and other citrus trees.

English recently saw a 1950s ad showing children drinking Florida orange juice.

It reminded him how long Americans have associated Florida with oranges.

Now, the state's orange production has plummeted 90% from nearly 150,000,090 pound boxes in 2005 to 15.8 million boxes in 2023, the lowest annual production since the 1930s.

But English has found himself back in an orange grove feeling hopeful.

You see, in the.

He oversees a test grove for a company called Soil Ceia, which has licensed the rights to further develop and commercialize precision bred citrus trees from the University of Florida.

Plant biologist Nian Wang and university colleagues used Crispr technology, a genome editing tool, to develop trees that can still survive and produce fruit despite exposure to the devastating bacteria.

The trees contain no foreign DNA from other plants.

For animals.

If successful, these genetically edited trees and rootstock could revive citrus production in Florida and save it elsewhere.

This problem is not only Florida problem, it's a worldwide problem in all of the major production area in Asia.

In Brazil, in the United States, we all have the same problem.

About 50 miles from Wong's Central Florida Labs soilcia's Tampa area facility houses a dozen employees who are rapidly refining the most promising genetic edits.

Early results have been positive, with the first priority on Valencia and Hamlin orange varieties and an edited rootstock for grafting.

What we're doing is finding the specific genes that are susceptible to HLB and using Crispr precision breeding that turn off this interaction.

And this occurs all the time in nature.

And we have a tree that we're saying is showing early HLB resistance.

We hope it's going to last for a lot longer, but we only have trees that have been in the field for a couple of years.

Every six months we test them, right.

To see.

If the bacteria is growing in the tree and what's going on.

And every six months we're getti Lagos and his colleagues are also working on citrus greening, resistant grapefruit and mandarin oranges.

We have to screen lots and lots of plants and different combinations of different Crispr edits to see what plant, you know, has the desired edit and is which one has the desired, you know, traits of resistance that we're hoping for.

We spend a lot of time these plants take six months to a year to get to this stage where they're in toil.

So we have to be very thorough in screening so that all the effort we're devoting for you isn't a waste.

In the past decade, Floridians have tried one possible solution after another, from spraying to kill the insects to tenting the young trees to protect them.

All either failed or required costly repeated treatments.

We do feel the pressure.

They do.

Get it the growers quickly because, I mean, they're.

Really struggling, right?

It's really I mean, it's a real testament.

To the growers.

That they've stayed in this industry, even with.

Citrus greening.

And now they may be close.

How do you know they're disease resistant?

Well, you got to put it into the field, right?

You have to expose it to the psyllid.

You have to expose it to the disease.

So far, researchers say the trees that result from precision breeding look much healthier than the control trees.

Different gene targets are showing tolerance where the plant actually still gets infected, but it's a big, beautiful tree compared to the controls.

We're seeing others where the amount of bacteria in the plant is so low or almost undetectable compared to the controls.

All that work in University of Florida and soilcia labs and greenhouses may finally bear fruit.

Literally, they hope.

But it takes almost half a decade before citrus trees produce significant amounts of fruit, after which traits such as taste and yield will need to be evaluated.

If everything goes well, I think we'd be looking at the end of 2026 or maybe spring of 2027, where we kind of get those first commercial trees out there, but they're going to still have to plant these trees in numbers.

And it's going to take four.

Five years even, you know, even maybe a little.

Longer before it's at full.

Production.

So to really start bringing.

The industry back, it's going to take some time.

As for Ron English, he is once again optimistic that his grandchildren might someday have the opportunity to get the family back into the citrus business.

This what we're doing is the key to getting back.

And once we can get people started and start planting, I think though, they don't catch on.

For Market to Market.

I'm Colleen Bradford Krantz.

Next the Market to market report.

Cold weather in key areas.

Key wheat growing areas offered some heat to the trade for the week.

The nearby wheat contract added $0.23, and the March corn contract gained $0.06.

Improved harvest conditions returned to Brazil, allowing for more of the large South American crop to enter the pipeline.

The March soybean contract strengthened $0.08, while March meal put on $0.30 per ton.

March cotton shrank $0.25 per hundredweight over in the dairy parlor.

March class three milk futures increased $0.04.

The livestock market was mixed.

April cattle declined $5.52.

March feeders cut $10.83, and the April lean hog contract put on $1.80.

In the currency markets, the US dollar index lost 35 ticks.

March crude oil fell $1.87 per barrel.

Comex gold expanded $52 per ounce, and the Goldman Sachs Commodity Index added more than three points to settle at 564.05 Joining us now is one of our regular market analysts, Ted Seifried.

Hi Paul.

HI Ted.

How are you doing?

I'm well.

So is the wheat market.

Yes.

By 4% this week.

The winner.

Very nice.

Is this a fundamental or a technical thing for you?

I think my view is always both.

Right.

But, you know, I think you touched on it there has been some bouts of cold weather, and there are more to come, at least in the forecast, that get us concerned about winter and things like that.

although, you know, weeds the crop, we say every year we kill nine times and it's and ends up fine.

keep in mind those winter wheat crop conditions were really bad, before, you know, when we go into dormancy.

We stopped talking winter wheat crop conditions.

That those will come back soon.

but either way, they were very poorly rated going into that.

So that is part of it.

I'm going to say that the talk about, the potential end of the conflict in Russia, Ukraine, I think, you know, longer term you have to say that's bearish because that could mean more wheat production specifically from the Ukraine.

but in the short to mid run, you know, it occurs to me that, you know, Russia has needed as much funds as possible, to fund this.

And, you know, you get the idea or the feeling that they've been selling wheat.

not they're not trying to sell it for less than what it's worth.

They're just trying to sell a lot of it.

So they're having to take lower prices.

And I think that's kind of artificially kept wheat prices down for a bit.

But with the idea that that might change and this might come to a conclusion sometime relatively soon, is giving wheat, a little bit more of a reason, I think, to go higher.

And then you look at the technicals and you have with what's called a cup and saucer formation, bottoming formation on, on a wheat chart.

And it's, it's a, it's a formation that if I had my speculative hat on Paul, I'll search through a whole bunch of different, commodities or markets looking for this exact formation, because it's one of my favorite ones that suggest a long term bottoming and some pretty significant upside potential.

Now I find it in the wheat market, and I take pause because I say, well, this is wheat, but I really like the look of the chart and the way we finished off the week, especially on Thursday, really makes me feel good that there might be some pretty decent upside potential for wheat.

And again, I don't have a whole arsenal of fundamental reasons for that.

But I really like to look at the chart right now.

So it's we know exactly what if I'm sitting there with some wheat to sell, to move, to forward contract?

Am I holding right now then, given what you just said?

I'm very cautiously optimistic in wheat.

That's the best way I can say that.

All right, fair enough.

we'd also to that help and spill over into corn.

Yeah, yeah.

You always expect that to be the case.

But, you know, the wheat corn relationship, when you look at it from a fund perspective, the funds have been really long.

Corn.

About as long as they've ever been for this time of year.

and then really short wheat.

So, you know, something kind of had to give, I think because of that, we, can have more upside potential, and corn doesn't have to follow along step for step, because the funds are already in on the corn.

They're already long.

They're, so might not be as tight of a relationship or correlation as we normally would look for, but it's certainly it's I really don't think it hurts higher wheat.

I really shouldn't hurt corn prices.

Well, corn also this week wheat was one thing.

But you also have yes to GMO corn resuming to Mexico.

You have, more stories with Mexico.

We've got trade stories.

Tariff stories.

I mean, if I look at what was in the market this week, it's screams more fundamental news than technical.

For wheat Or for corn.

Yeah, I would say so.

but I mean, look at the corn market.

It was very choppy this week.

And we've got fundamentals that are it's a it's a bit of a tug of war.

We've got bullish, we've got bearish.

We've got a whole mix of stuff.

And we're trading headlines because tariffs all the policy and tariff talk and trade talk has this on the edge of our seats.

So we are really kind of choppy even in intraday.

one of the days this week was Wednesday or Thursday.

Were we.

yeah Thursday.

We were down hard right out of the gate.

But then midday the U.S. Trade representative, nominee gets he said something and we went sharply higher.

Right.

And so we're hanging on every word of whatever.

But yes, there's a lot of fundamentals that are involved with corn right now.

the normal fundamentals, which would be, hey, South American weather.

Right.

And we know we have a problem with Argentina.

Is it getting better?

Yes.

They've gotten some rains.

It does seem like the weather pattern is improved, but is it been enough to really fix or, keep away, any permanent damage?

And does the forecast in the future really, give us a whole lot of confidence in that?

No.

Not really.

It's still developing thing.

I think it will get better, but it's not fixed.

It's that's not a story that's behind us.

And then obviously, the second season planting, in Monte Grosso has been a major talking point.

but that's sort of changed this week as well, too.

We'll get to soybeans in a minute, but I want to use the tariffs as a transition between the two if we could.

Dan in Iowas question for you, Ted, is how will the new tariffs affect corn and soybean prices for farmers?

And I'm going to put this a little bit for you, Ted, because this is a it depends.

It depends on the country.

Right.

Let's start Canada and Mexico first.

Yeah Canada and Mexico.

And again, that was the big news story throughout last weekend and into Sunday.

Monday.

you know, those have been delayed for months now.

either are tariffs on them or they're retaliatory tariffs on us.

But if Canada and Mexico respond with 25% tariffs across the board, like what we're talking about doing, well, that is that's a bit of a problem, right?

I mean, you have Mexico, who is traditionally our number one or number two corn buyer them in Japan.

wow.

That could push them at a time of the year where they could really start looking at Brazil.

And if Mexico fosters that relationship with Brazil over corn over us, that could have a very long term lasting effect, negative effect on our relationship, and our corn sales to Mexico.

I'm very worried about that.

However, I also feel like that, Mexico situation could I don't know what I don't want to say.

Easy.

You know, trade wars are quick and easy to win.

But that, I think, is something that is resolvable.

I think there's a I'm optimistic that that does get resolved.

before the month delay is over.

I think Canada as well, the big one is China, but that's more of a soybean question.

So let's go into that then.

What's the impact on soybeans with the China relationship and trade.

So the interesting thing about that is that we delayed the tariffs to Mexico and Canada, but we did not delay the 10% increase on tariffs to China.

We went through with that.

China did retaliate, but there was nothing in agriculture on there aside from agricultural equipment.

so no soybeans and no corn.

Not that they've been they haven't bought any corn from us.

so that doesn't I think we had a sigh of collective sigh of relief when that wasn't on there.

but as we ramp up tariffs with China, China has already been trying to avoid us as much as possible for their purchases.

I mean, their purchases from us are down significantly.

I should say, on market share on our global soybean exports to China.

We've lost significantly to Brazil in this last year.

That's been a trend that's been happening for quite some time.

But this last year it's been really emphasized.

So it doesn't help with that.

It doesn't it doesn't really give you the warm and fuzzy feelings of, of, hey, China's going to, you know, start preferring us a little bit more.

there's some optimism about that because there's talk that, you know, we're going to really, the put it to them to, to hold up to the trade one or, phase one trade deal.

I don't know.

I have skepticism about that.

The market seems to be pretty optimistic, though.

Are you skeptical and selling November things ahead right now.

And beans.

I'll give you a numbers, I think.

I think I should be anywhere from 20 to 35% sold on November on new crop November soybeans.

November beyond soybeans at this moment.

Okay.

livestock huge.

Not correction, but sales.

live cattle feeders, $5, $10 expected.

well, I mean, we had a market that had gotten very overbought.

You had funds with a record long position in the cattle complex.

You knew that any correction could be violent.

And then on Thursday, you had the news of, bird flu and the really dangerous version, found in a dairy cow, in Nevada.

that causes panic.

Speculators funds run for the doors.

And when they're sitting on a record large position on a long term bull market, it can create for a very deep correction.

Now, we held his support at the end of the week, but that could come under fire early next week.

I'm worried if the funds do continue to, exit their long positions, this could be a much bigger correction than I think most people would expect.

And commitment of traders would tell you that it's the funds that have entered this market and helped push it up.

And so that's why you have such the alarm for, for them exiting.

They have a large, they have a large percentage of the open interest.

It's not just them.

Open interest is at highs too.

But just the sheer amount of, of, contracts that they have on I mean, if they're getting out of 153,000 contracts in a live cattle market, that's, that's going to hurt.

And same with feeders.

They're kind of done in feeders, too, right?

Right.

All right.

Hog market.

this is something where I think, there was a story late today, U.S meat export Federation said pork exports that records in volume and value in 2024.

Can we do it in 25 as well?

Well I mean that concept and the in the hog market in general dodged a major bullet when we deferred tariffs, on, Canada and Mexico, specifically Mexico.

Mexico is a big business partner for us for pork exports.

and yeah, if we can forego those, if we can negotiate, what we want from a trade war between now and when those are, those tariffs are set to take place.

yeah.

I think there is a very good possibility that we can increase our pork exports, but tariffs would be a very limiting factor on that.

So I don't know.

We'll find out in about a month.

lastly on the dollar weaker this week.

Is there anything that is that even a part of this discussion.

Or is it really just dominated by tariffs in commodities as a whole?

I mean, look, you've got a whole lot going on for the dollar right now between tariffs and policy.

But then, you know, we've got a fed meeting coming up.

We had unemployment numbers on Friday that was positive for the dollar by the way.

And just like we talked about in corn, you've got a whole lot of conflicting factors.

And that's headline driven.

I think ultimately we want the dollar value to come down.

And when I say we, I mean, the current administration wants the dollar value.

They want to get rid of inflation or really tame inflation, while at the same time fostering a good economy, which is an extremely difficult thing, almost impossible thing to do.

I still think the dollar has more upside potential, but there are a lot of things that can get in the way.

Of that said, good to see you.

Thank you so much.

Thanks.

Paul.

Ted Seifried everybody.

All right.

Thank you.

Ted, we're going to pause the analysis that we've just been doing, and we're going to continue our discussion about the markets in our Market Plus segment.

You can find both analysis and plus on our website.

That's markettomarket.org.

An old fashioned email can be the answer to your questions.

Whether it's about this program or you want to register a comment on a story, or maybe you have an idea for coverage, our inbox is always open.

Drop us a line to markettomarket@iowapbs.org.

Next week, new farmers get some insight on navigating the business of producing food.

Thank you so much for watching.

Have a great week.

Market to market is a production of Iowa PBS, which is solely responsible for its content.

Whats next?

Doesnt happen by chance.

It happens when researchers and farmers work together to solve tomorrows agronomic challenges.

Were committed to creating whats next because at Pioneer our name is our mission.

For over 45 years, Steiner Tractor Parts has shared your love of antique tractors.

New parts for old tractors.

Learn more atSteiner tractor.com or at (877)559-7887.

Tomorrow.

For over 100 years.

We've worked to help our customers be ready for tomorrow.

Trust in tomorrow.

Information is available from a Grinnell Mutual agent today.

This week on Market to Market.

New farmers.

Get some insight on navigating the business of producing food and commodity market analysis with Chris Robinson.

Market.

To Market.

The Weekly Journal of Rural America.