Trump calls glyphosate a matter of national importance

The European wheat market is calmer than in the US. In Chicago, wheat climbed to its highest level in nine months as cold weather in the Black Sea region and drought in the US lifted the weather risk premium. Geopolitical tensions in the Black Sea region and the Middle East added further support. Meanwhile, Trump designated glyphosate and phosphate as essential not only for US agriculture, but also for national security. The March contract for wheat on the Matif rose yesterday by €3 to €193.75 per tonne. On the CBoT, wheat increased by 12½ cents or 2.3% to $5.59½ per bushel. That is the highest closing price since June. Corn took a step back and closed 1¼ cents lower at $4.25¾ per bushel. Soybeans were in the green, increasing by 7½ cents to $11.14 per bushel. The European wheat market is lagging a bit behind the American market. Meanwhile, plenty is happening on our continent as well. In Ukraine and Russia, the cold weather is returning after a somewhat milder period. In areas where the snow has melted and water is standing on the land, winter wheat is particularly sensitive to frost damage, various local sources report. Therefore, the weather premium in wheat is being adjusted a bit. Threatening languageGeopolitical tensions are also food for the bulls in the market. Negotiations for peace between Russia and Ukraine in Geneva, Switzerland, earlier this week ended without result. The Russian and Ukrainian negotiators agreed that the negotiations are indeed difficult. The fact that there is no agreement does not come as a surprise. In the Middle East, the relationship between the US and Iran is drawing attention. Iran, along with Russia, held an annual military drill yesterday. Earlier this week, during an exercise in the Strait of Hormuz, Iran had already fired live ammunition. Meanwhile, a second aircraft carrier from the US is on its way to the Middle East. Trump is further increasing pressure on Iran to reach an agreement regarding the Iranian nuclear program. Trump believes that '10 to 15 days is sufficient time' to reach a deal with Iran, as noted by the AP news agency. If Iran does not agree, the country will face 'bad things' according to the American president. National interestDomestically, Trump also made a somewhat remarkable decision. Glyphosate and phosphorus have been designated by the American president as crucial for national security under the Defense Production Act. This means that American producers adhering to national guidelines enjoy legal benefits. On the flip side, should it be necessary, the USDA can take over production and distribution. According to Trump, phosphorus and glyphosate products are essential, not only for agriculture but also from a military point of view. A threatening shortage of phosphorus or glyphosate makes the US vulnerable, according to the president. Bayer is the only producer of glyphosate in the US. Additionally, significant volumes of glyphosate are imported from China for use in American agriculture. The Wall Street Journal calculated last year that about 40% of global glyphosate production came from Bayer's plants in the US. The fertilizer companies Mosaic and Nutrien together hold the vast majority of the phosphorus market for agricultural use. Larger shiftYesterday, the USDA released its first acreage forecast for the 2026 harvest year. The shift from corn to soybeans is even slightly larger than predicted in Bloomberg's survey. Bloomberg expected an additional 3.8 million acres of soybeans at the expense of corn compared to last season. The USDA reported 4.8 million acres less corn and 4.8 million acres more soybeans. The wheat acreage is set to be 300,000 acres smaller than for the 2025 harvest year, totaling 45 million acres. The reaction of traders on the CBoT was perhaps not exactly as you would expect solely based on the USDA figures. The increase in soybeans is attributed by some analysts to the expectation (or perhaps hope) that China will purchase a significant amount of American soybeans in the coming weeks. Wheat received some extra momentum due to the drought in the US. Of the winter wheat acreage in the US, 46% is in a drought region. This is 1% more than last week and the highest percentage of wheat affected by drought in 52 weeks.