3 things to watch

Added: 2026-06-02

[00:00:00]This is Carl with the three things I'm watching for Monday, June 1st.

[00:00:05]Uh starting off, US Iran conflict heated up over the weekend. As a matter of fact, overnight we saw missile attacks from both sides.

[00:00:14]Kuwait also seen drone attacks over the weekend.

[00:00:18]Bottom line is, even though we're told that the ceasefire is in place and holding and this peace proposal and everything else, uh the conflict has not really wound down that much. And we continue to see these attacks back and forth.

[00:00:34]Um Israel also continuing to attack Hezbollah.

[00:00:38]Uh the bottom line is, nothing really, you know, the US doesn't have uh persistent attacks on Iran, but it really doesn't appear as though things are calming down as much as we were told. Crude oil up uh three and a half dollars give or take overnight here.

[00:00:55]Um a lot of risk premium coming back into the market and rightfully so.

[00:00:58]Bottom line is, no matter what we're told about the Persian Gulf, until the Straits of Hormuz are open and there is a steady flow of crude oil coming out, um it is very unlikely that the market is going to change its attitude anymore.

[00:01:16]Uh they want to see uh results, not just talk. And that's kind of where we're at in the global market impacting the energy a little more than anything else.

[00:01:25]Processing margins uh really starting to take off here in the United States again. We are back at all-time highs on soybean crush 394 on the board, 425 or so uh in the interior market. Ethanol grind 45 cents uh per gallon, so a little over a buck a bushel there on the return.

[00:01:45]Bottom line is, those processing margins are starting to offset some of the losses in futures we've seen. A lot of them being credited to the US Iran war and its impact on the energy market, but the reality is we had those strong processing margins a year ago before we got into the war with Iran.

[00:02:04]You know, ethanol was at record highs and so was soy crush and now we're we're back to those levels putting in new ones. Don't get me wrong, the conflict has provided some support, but there's a lot of other demand in there and mainly for soy meal. Our soy meal is really supporting soy crush. So, really starting to pick things up there a little bit and and like I said, calm down some of that volatility in futures trade.

[00:02:31]Third and final thing I want to talk about the US export demand. We are seeing a big shift from old crop to new crop. It's seasonal, that's not too surprising. We do tend to see that take place.

[00:02:44]You know, the the concern that trade is showing now is we are seeing a little more interest on the demand side now that the crop is getting planted.

[00:02:52]Usually those tend to shift back and forth here, but we're a little bit more on demand than production right now and the one trade looking at new crop soybeans.

[00:03:01]No sales to China again.

[00:03:04]That's not uncommon. China usually doesn't start booking soybeans from the United States till later in the marketing year. Matter of fact, a little bit closer to harvest when they start layering in the the bulk of their demand. So, you know, last year was a little slow to get the sales started, but we had different circumstances.

[00:03:23]I I'm not too worried about China. They will step in and buy, but the market bears want to keep pointing out that that they haven't bought anything yet and that's the keyword, yet. China does have 25 million metric tons they've agreed to. I expect them to fully buy them no matter when they start.

[00:03:42]But the fact is our prices were the highest price soybeans in the world right now. Nobody's going to book from us if they don't absolutely have to.

[00:03:50]Those are the three things I'm watching today.