Fed Cuts Rates Again, Could Inflation Cause the Next Grain Bull Market??

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0:00 Fed Cut and Grains
4:06 Soybean Bounce
6:11 Flash Sale and Soybean Tracker
8:39 Regenerative Pilot Program
9:58 Ukraine/Russia
10:48 Ethanol Production

🏦 Fed Cuts Rates for the Third Straight Meeting

The Federal Reserve lowered interest rates another quarter point on Wednesday, bringing the fed funds rate down to 3.5%–3.75%, the lowest since September 2022. Three FOMC members dissented — the most pushback since 2019 — signaling deep concern about the path forward.

Fed Chair Jerome Powell said the goal is to steady the labor market while keeping inflation moving toward the 2% target. The Fed’s new projections show just one cut in 2026 and another in 2027, far fewer than markets expected.

Some economists warn that stagflation is becoming a real risk — inflation that stays too high while job growth weakens.
👉 Prices keep rising while the economy slows, family budgets get squeezed, and fixing one problem risks worsening the other.
See charts below.

🌱 Soybeans Rebound on Flash Sales

Soybean futures stabilized after multi-week lows. Jan26 beans +4¢, settling near $10.91 after USDA announced a 5 mil bu sale to China and 12 mil bu to unknown destinations. Gains were limited by ongoing confusion regarding China’s schedule for buying the agreed 12mmt of U.S. soybeans.

Corn and wheat moved lower:
• Mar26 corn −4¢ → ~$4.44
• Mar Chicago wheat −5¢ → ~$5.30
See charts below.

🚢 Fresh Flash Sales Reported Wednesday

USDA confirmed new export activity for 2025/26 delivery:
• 136,000mt soybeans → China (~5 mil bu)
• 331,000mt soybeans → Unknown (~12 mil bu)
• 120,000mt soybean cake & meal → Poland

See updated China Soybean Purchase Tracker below.

🌾 Trump Administration Rolls Out $700M Regenerative Ag Pilot

The White House announced a $700 million program under “Make America Healthy Again” to expand practices like cover crops, no-till, conservation planning, and whole-farm soil & water management.

Farmers will apply through EQIP or CSP, with an emphasis on soil health, water quality, and habitat.
📝 Payment rates have not yet been released.

⚓ Ukraine Hits Russia’s Shadow Fleet Again

Ukraine used Sea Baby drones to attack a large Suezmax tanker tied to Russia’s oil trade. The empty vessel (1 million-barrel capacity) suffered major damage.

As these attacks continue:
• Freight costs are expected to rise
• Crews are increasingly wary of Black Sea movements
• Putin warned he may retaliate against vessels controlled by Ukraine’s allies
• He also suggested Russia could cut off Ukraine’s access to the Black Sea entirely

⛽ US Ethanol Production Slips

Weekly ethanol output fell to 1.11 million bpd (−1.9% vs. last week, +3% vs. last year).
Stocks declined to 22.51 million barrels, slightly lower week-over-week and −2.1% versus last year.

Margins have weakened: Reuters estimates break-even to +30¢ across the Corn Belt based on spot corn, DDGs, inputs, and product values.
See charts below.