Markets are robust on a post-inauguration Tuesday. John Heinberg, advisor with Total Farm Marketing in West Bend, explains what areas of optimism are spilling over into trading. He says tariffs and weather are the key points.
The soybean markets, for example, saw some fuel following the Martin Luther King Jr. Holiday break. Heinberg says some of that is tied to the inauguration.
“Just the stance that President Trump was taking on tariffs yesterday… talked about the 25 percent tariff on Canada and Mexico maybe by the first of February.”
Heinberg says the soybean market today is primarily driven by South American weather. This past weekend, rain came to the region after weeks of dry weather.
“Now we’re focusing on the harvest side of it. Mato Grosso is the No. 1 producing state in Brazil in terms of grains. They have been staying on the wet side. Harvest is delayed.”
Beyond soybeans, the crude oil market saw selling pressure in the last 24 hours and the “highest price levels we’ve seen in months,” according to Heinberg.
He notes there wasn’t anything “drastic” to come out of President Trump’s inauguration speech.
“The market I think is in a bit of a wait and see mentality,” he says. “I think we did put some premium into the market going into the inauguration, just on the pure fact that some of those policies (tariffs) could be inflationary.”
