This is the SFN Market Report with Brooks Schaffer of Palmetto Grain. Reach him at [email protected] or 843-540-4540.

Monday’s session did not have a lot of new news to trade on. Export inspections were within expectations on corn and wheat, and above on beans, but still well below last year’s level. That is due to China still not buying anything from the U.S. yet this year.

Soybeans were the leader to the upside late in Monday’s session after comments from Trump saying that a deal with China is likely. If you feel like you have whiplash now, you are not the only one. It was just a little more than a week ago Trump was tweeting threats to ratchet the trade war up significantly, and now he says we are close to a deal.

There are high-level trade talks with China scheduled this week leading up to the planned meeting between Trump and Chinese President Xi Jinping at the end of this month. Treasury Secretary Scott Bessent has already offered to extend the tariff truce if a deal can be reached on rare earth minerals, but we hope for more than just an extension of the truce. Secretary Bessent is scheduled to meet with Chinese Vice Premier at the end of the week, closing out the high-level talks and paving the way for the Trump-Xi meeting in South Korea next week (hopefully).

How many more times we oscillate between “we are close to a deal and all assets need to rally” and “China is attacking us on trade so we need to retaliate with all leverage we have” is anyone’s guess. There is time for a lot more tweets from Trump between now and the end of the month, but the market is optimistic today.

China has covered all its usage on soybeans through at least the end of November with the purchases it made from Argentina. That means it could still buy its December and January needs from us if we do make progress. That would be very helpful to the soybean balance sheet, but the 300 million or so bushels it needs is below even the low level of 500 million bushels it bought from us during the first trade war and African swine fever. But at this point, I think the market would be very happy with 300 million bushels.

There is no threatening weather on the horizon in Brazil, as planting is rolling along. They should have beans ready to ship by the end of January. Trump also announced a plan to buy beef from Argentina to help stabilize U.S. beef prices.

There does not seem to be much progress on a compromise to reopen the government. White House economic adviser Kevin Hassett said he thinks the shutdown will end this week. I will believe it when I see it. The USDA says we will not get any details about the assistance payments until the government reopens, but if it continues much longer, they may have to go back on that.

Harvest in the U.S. continues to roll along. There were some rains across parts of the Midwest with totals up to 2 inches, but as dry as they were, I suspect combines were back in the field today almost everywhere. Basis levels in the Midwest are strengthening as users and elevators are trying to pull bushels off the farm — not what we would have expected with the biggest crops ever. Markets will continue to trade sideways until we get headlines or tweets to react to.