The first week of the new year could be a big one for several agricultural groups and stakeholders. The Supreme Court will likely hear several high-stakes cases that could affect America’s farmers and ranchers. A DTN report says the court recently distributed three of four agriculture cases scheduled for a January 7 conference. Those high-profile petitions include challenges to California’s Prop 12, an appeals court ruling that eliminated year-round E15 ethanol, and a long-fought Clean Water Act case dealing with Environmental Protection Agency authority over farmers and ranchers. Bayer has also filed a court petition on the Roundup settlement case that’s worth many millions of dollars. While the case hasn’t yet been distributed for a Supreme Court conference, the court recently invited the U.S. Solicitor General to file a brief in the case, asking for more information. Justices hold a conference every Friday during their session to decide what petitions they’ll accept.
Welcome
Friday, December 31, 2021
The Price of Food in 2022
The new year will see inflation rates that will continue to impact the food industry and cause prices to rise at grocery stores across the country. Research firm IRI says food prices are estimated to rise by five percent during the first half of 2022. However, the level of increases will depend on each grocery store and its location. The IRI report says price increases are showing up in everyday items like breakfast meats, frozen poultry, and pet food. Prices of produce like potatoes and celery are expected to increase because of higher freight costs. Fortune.com says other factors contributing to the jump in the price of food are higher oil prices and companies that have to pass on the cost of more expensive transportation. Major food distribution companies recently announced price hikes heading into 2022. General Mills, Kraft Heinz, and others are raising prices on candy, cereal, Jell-O, and many other products.
Ethanol Production Rises Slightly
The Energy Information Administration says ethanol output rose slightly week-to-week while stockpiles declined. Production of the biofuel increased to an average of 1.059 million barrels a day during the week ending on December 24. That’s up from an average of 1.051 million barrels a day during the previous week. In the Midwest, which is by far the biggest-producing region, output increased to an average of 1.001 million barrels per day, up from 991 million barrels a week earlier. That was where all the gains took place as East Coast and West Coast production remained at 12,000 barrels a day and 10,000 barrels, respectively. Production in the Rocky Mountain and Gulf Coast regions dropped to 23,000 barrels a day and 13,000 barrels, respectively. Ethanol inventories during the week ending on December 24 fell to 20.76 million barrels, down from 20.705 million the week before. That’s the lowest level since the week ending on December 3.
Drought Monitor Shows Slight Decrease in Midwest Dryness
The latest U.S. drought monitor shows that mostly dry weather with much-above normal temperatures persisted through the central and southern Great Plains recently. As of December 28, month-to-date temperatures in the southcentral U.S. were more than seven degrees above normal. Widespread precipitation in the Midwest supported a slight decrease in dry soils across parts of Minnesota. However, long-term deficits continue in other parts of the Upper Mississippi River Valley. Western Wisconsin also saw small improvements, while moderate to severe drought expanded slightly in southern Wisconsin. A small area of severe drought showed up west of St. Louis, while parts of Missouri saw an increase in abnormal dryness. Another expansion of drought classification took place in Kansas due to worsening soil-moisture conditions. The Drought Monitor says increasing snowpack led to improving drought conditions in the Central Rockies. The Monitor also showed a slight decrease in abnormal dryness and moderate drought across central and eastern North Dakota.
Friday Watch List
Markets
Don't pop the champagne just yet -- U.S. grain and livestock futures have one more day of trading Friday and will close at normal times. There are no official reports on the docket and USDA offices will be closed. With few players minding the markets and trading volume apt to be low, be careful of pre-holiday manipulation. Grain futures resume trading Sunday evening at 7 p.m. CST.
Weather
A system in the Southwest will start to move into Texas Friday night. Ahead of it, cold arctic air is flowing south through the Plains and showers will develop later in the day along and south of a front from Texas through the Ohio Valley. Freezing rain and moderate to heavy snow will develop across the Central Plains tonight and the whole system will spread eastward through the weekend. Meanwhile, cold arctic air will flow in behind the system with dangerous wind chills. Some precipitation will get into the southwestern Plains where it is desperately needed, but amounts are going to be on the lighter side and unable to move the needle on the ongoing drought.
Thursday, December 30, 2021
Consumer Spending on Food Dropped 10 Percent in 2020
During COVID-19 and the economic recession of 2020, the share of consumers’ disposable personal income spent on food dropped 10.1 percent from the previous year to 8.62 percent. The USDA says that’s the lowest share in the past 60 years. Disposable Personal Income is the amount of money that consumers have left to spend or save after paying taxes. The share of consumer DPI spend on food in the U.S. stayed steady for two decades. It dropped from 9.95 percent in 2000 to 9.58 percent in 2019. Consumers spent 1.4 percent more of their incomes on food bought for home consumption from 2019 to 2020. During the same period, they spent 22.2 percent less of their incomes outside of the home. Changes in percent of income spent on food in 2020 came about because of COVID-19-related closures and restrictions on food-away-from-home establishments, and the biggest increase in DPI in 20 years, thanks in part to stimulus payments and unemployment insurance.
China to Approve Domestic GMO Corn Varieties
The Chinese government considering safety approval for more genetically modified corn varieties put out by its domestic producers. Bloomberg says that could lead to planting more of these crops within the world’s top corn buyer. China’s agriculture ministry is looking for public opinion on the safety approval of three GMO corn varieties and seven new GMO cotton strains. Beijing allows imports of GMO crops for processing, and they can’t be used as seeds. Genetically modified crops are grown by many of the world’s top crop producers, including the U.S., Brazil, and Argentina. Other countries limit their use due to health and environmental concerns. China’s move comes as the country has bought large amount of grain supplies from around the globe to feed their hog herd, which is still recovering from African Swine Fever. Beijing focused more on its own food security through the past year, including more self-sufficiency in staple grains.
New York Will Require Biofuel Blending in Heating Oil
New York will soon be the biggest state to require biodiesel to be blended into its heating oil. Recent legislation says that starting in July 2022, petroleum-based heating oil sold in the state will get blended with increasing amounts of biodiesel. The goal of the move is to help New York get to its goal of lowering greenhouse gas emissions. Biodiesel industry advocates estimate that the fuel will cut New York’s annual petroleum diesel consumption by about 200 million gallons every year. That will drop the state’s annual carbon emissions by roughly one million metric tons. New York’s governor says the bill is a step toward meeting the goals of the state’s Climate Leadership and Community Protection Act. All heating oil sold in New York must have at least five percent biodiesel by July 1, 10 percent by 2025, and 20 percent by 2030. Blending requirements are already in effect in Long Island and New York City.
Farmland Prices in 2022
U.S. farmland supply-and-demand is different than in recent years. As commodity prices rose this year and investor interest returned to the market, the supply of available farmland followed suit. Randy Dickhut of Farmers National Company tells Ag Web Dot Com that over the past year, most of the Grain Belt saw increasing amounts of land getting sold. “A number of states saw at least a 10 percent rise in the number of transactions,” Dickhut says. Schrader Real Estate and Auction company tells Ag Web that his firm had twice as many sales above $10,000 an acre as they did in 2019. This year saw 60 percent more sales above $10,000 per acre than they did last year. Dickhut says if the factors supporting land prices stay pointed in the same direction, the market should stay firm and may even climb somewhat higher. “Things could change if those factors change, or unexpected events take place,” Dickhut says.
Thursday Watch List
Markets
There will be initial and continuing jobless claims and a Chicago Purchasing Managers Index (PMI) report out early. We will also be watching for any weather changes for South America, and we will watch for any new export sales and the weekly export sales out at 7:30 a.m. CT.
Weather
After some severe weather moved through on Wednesday, lingering showers continue in the Southeast on Thursday with some potential for localized flooding. Cold still remains across the northern tier of the country while dryness continues to hurt wheat in the southwestern Plains.
Wednesday, December 29, 2021
More Planting, More Uncertainty Ahead
The Wall Street Journal says farmers plan to plant more corn, soybeans, and wheat than last year, but they also face more uncertainty. The Wall Street Journal says a banner year for grain prices has U.S. farmers planting even more commodities than they did last year. However, high fertilizer prices, forecasts for more weather challenges, and the threat of China slowing its demand for global commodities may put a damper on the anticipation. “Row crops this year soared to highs not seen in years,” the Wall Street Journal article says. “Those highs came about because of surging global demand and inflation, so farmers will likely increase planting as they try to sustain the momentum of 2021.” However, analysts and investors say geopolitics may bring more volatility to prices next year. The biggest potential disruptions to international trade include U.S. and China tensions and the Russian troop buildup near Ukraine’s border.
U of Illinois Sees Higher Corn and Soybean Break-Even Prices
The University of Illinois’ Department of Agricultural and Consumer Economics set its corn and soybean break-even prices for 2022. Break-even prices farmers need to reach to cover their total cost of production are projected at $4.73 a bushel for corn and $11.06 a bushel for soybeans. These break-even prices are quite high compared to historical levels. From 2013 to 2021, actual break-even prices for corn averaged $4.00 a bushel, well below the 2022 projected level. The break-even prices for soybeans averaged $8.92 a bushel, well below the 2022 level. While many recent bids were above break-even levels, the higher break-evens present a risk in 2022 as corn and soybean production costs will increase to record levels. The factors pushing costs higher include high commodity prices, inflation pressures, and supply disruptions. By far, the input with the biggest cost increase will be fertilizer. The University of Illinois says commodity pricing some grain at current levels would be prudent.
Price of Food Moves Higher in November
The USDA says the Consumer Price Index for Food moved higher in November, rising 0.5 percent from October to reach levels that are 6.1 percent higher than November 2020. The level of food price inflation varies depending on whether the food was purchased for consumption at home or away from home. The food-away-from-home, or restaurant purchases, CPI increased 0.6 percent in November 2021 and was 5.8 percent higher than November of last year. The food-at-home, or grocery store purchases, CPI increased 0.3 percent from October to November and was 6.4 percent higher than November 2020. So far this year, the year-to-date average food-at-home prices have increased 3.1 percent and food-away-from-home prices increased by 4.2 percent. The all-food Consumer Price Index combined to jump by an average of 3.6 percent. The beef and veal category had the biggest relative price increase of 8.7 percent. The vegetable category saw the smallest jump at 0.9 percent.
Weekly Wheat Export Inspection Numbers Rise
The USDA says inspections for overseas wheat deliveries rose week-to-week while corn and bean assessments dropped. Wheat inspections during the seven days ending on December 23 totaled 271,350 metric tons. That’s up from almost 227,000 tons the week prior, but well below the 407,400 metric tons examined during the same week in 2020. Corn assessments totaled 719,000 metric tons, down from one million tons the previous week. It’s also down from the 1.27 million tons inspected during the same time in 2020. Soybean inspections came in at 1.58 million metric tons, down from 1.89 million the previous week. During the same week last year, the agency inspected 2.27 million metric tons for export. Since the current marketing year began, the USDA has inspected 12 million metric tons of corn for delivery, down from 14.1 million tons last year. Soybean inspections total 28.9 million tons, down from 37.5 million. Wheat inspections are at 11.9 million tons after 14.5.
Wednesday Watch List
Markets
There are very few reports on the U.S. government docket on Wednesday, except for a pending home sales index report. We will be focused on primarily any weather updates from South America, and any new 8 a.m. export sales announcements. We will also be looking for the EIA's weekly ethanol production report.
Weather
A frontal boundary from north Texas up through the Ohio Valley is going to be the feature of the day as a system moves along it Wednesday. Thunderstorms will be aided by moisture from the Gulf of Mexico to produce potentially severe weather along and just south of the boundary across the Delta and Tennessee Valley, including potential for a few tornadoes. Cold conditions have spread a bit farther south and east with bone-chilling cold in the Canadian Prairies through the Northern Plains while heat remains south of the front.
Tuesday, December 28, 2021
U.S. Hog Inventory Down Four Percent
As of December 1, U.S. farms held 74.2 million hogs and pigs, a four percent drop from the same time in 2020. It’s also a one percent drop from September 1, 2021. Those numbers come from the latest Quarterly Hogs and Pigs Report published by the National Agricultural Statistics Service. Of those 74.2 million hogs and pigs, 68 million were market hogs, and just over six million were kept for breeding. Between September and November of this year, U.S. farmers weaned 33.7 million pigs, down four percent from the same period in 2020. Hog producers also weaned an average of 11.19 pigs per litter. U.S. hog producers intend to have 2.94 million sows farrow between December 2021 and February 2022. They’ll also have just over three million sows farrow from March to May 2022. Iowa had the largest inventory among the states at 23.8 million head, followed by Minnesota at 8.9 million.
Dairy Checkoff Drives 2021 Sales Growth
Despite the challenges brought on by COVID-19, the Dairy Checkoff continued to help its foodservice partners to grow sales of U.S. dairy foods. Dairy Management Incorporated, the organization that oversees the checkoff, says more domestic dairy got shipped into the international marketplace in 2021. The checkoff continued its effort to connect with the Gen Z consumers, while the dairy industry’s sustainability journey reached new levels during a busy year. DMI CEO Barbara O’Brien says the dairy checkoff delivered on its mission to drive sales and trust. “We not only adapted to the realities of COVID, but we used it as an opportunity to become even more consumer-centric, more efficient, and more collaborative,” O’Brien says. She points out the continued success of the checkoff’s partnership with globally-recognized companies like Domino’s, Taco Bell, and McDonald’s. Overall dairy sales at those chains grew between three and six percent this year.
China’s Pork Production Increases Mean More Grain Imports
A recent Bloomberg report says China, which consumes half the world’s pork, has a goal to be mostly self-sufficient in pork production. That means it will need more grain imports to feed the world’s biggest pig herd. China’s agriculture ministry says the country will maintain a target to produce 95 percent of their protein at home by 2025. It wants to be self-sufficient in poultry and eggs, 85 percent for beef and mutton, and 70 percent for dairy. Farm Policy News says the targets will likely bolster overseas purchases of soybeans and feed grains needed to fatten hogs, cattle, and poultry. China is already the world’s largest importer of soybeans and corn. The Asian nation has been purchasing unprecedented amounts in the past two years to help feed a hog herd recovering from Swine Fever. China’s president Xi (Zhee) Jinping recently urged his country to protect farmland and expand soybean and oil crops planting.
Kansas City Southern Railroad Sale Completed
Kansas City Southern says its sale to Canadian Pacific Railway is officially complete. The deal is estimated to be worth $31 billion. CP President and CEO Keith Creel says it’s a historic day for both companies. “CPKC will become the backbone connecting our customers to new markets, enhancing competition in the U.S. rail network, and driving economic growth across North America,” Creel says. “All of this happens while we will deliver significant environmental benefits. We’re excited to be on a path to creating a truly unique North American railroad.” The Kansas City Southern board of directors and management team says they are proud of the countless contributions and achievements of all those who work for KCS. A company statement says, “We are excited for the possibilities that open to us through this combination with CP and look forward to the next chapter.” The companies await approval from the Surface Transportation Board allowing CP’s control of KCS railroads.
Tuesday Watch List
Markets
There are very few reports on the U.S. government docket, but Tuesday will feature the S & P Case-Shiller home price index. We will be watching for any new sales announcements on Tuesday, and the updated South American weather forecast. Later Monday the CFTC will be out with their COT report and it will be interesting to see the fund positions.
Weather
A storm system is moving out of the Plains and through the Midwest on Tuesday. More widespread moderate precipitation is falling with this system than the one that moved through Sunday into Monday with snowfall impacts to more of the Midwest as well. Some light snowfall is moving through the Northern Plains, where temperatures have fallen and should remain well below normal. The southwestern Plains continue to get missed as drought builds throughout the region. Temperatures will remain tight across the middle of the country with a sharp gradient from cold in the northwest to warm in the southeast.
Monday, December 27, 2021
N.C. “Right to Farm” Act Upheld in Court of Appeals
A three-judge panel unanimously dismissed a challenge to the North Carolina “Right to Farm” Act. National Hog Farmer says the challenge got brought by the Rural Empowerment Association for Community Help, North Carolina Environmental Justice Community Action Network, and Waterkeeper Alliance in 2019. The ruling was similar to a decision made earlier this year by a special panel of three Superior Court Judges. In 2017, North Carolina lawmakers passed legislation to clarify and strengthen the state’s Right to Farm laws to protect and ensure farming can continue in the state. The Act first got passed in 1979 and then further strengthened in 2013. Legislators added more clarification in 2017 and 2018 after a federal judge allowed nuisance lawsuits to get filed against swine farms in federal court. This case got brought against the Right to Farm Act as a whole, so there is a possibility it could get challenged again in the future over a specific incident.
Ethanol Stocks Unexpectedly Decline
American ethanol inventories took a surprising drop last week while production also fell. The Energy Information Administration says U.S. ethanol inventories totaled 20.7 million barrels during the week ending on December 17. That’s a drop of almost 200,000 barrels from the prior week. Dow Jones industrial analysts did a recent survey that found stocks forecast to rise anywhere from 200,000 barrels to over 300,000 barrels. Daily production also dropped during the week, with production down by 36,000 barrels per day to 1.05 million a day. Analysts had expected production to rise slightly from the previous week. The Midwest is by far the largest producing region in the country, but output still fell to 991,000 barrels a day, on average, from 1.025 million barrels the previous week. Output for the week ending December 17 was the lowest total in three weeks. Inventories were down narrowly, falling to 20.705 million barrels, down from 20.88 million barrels the previous week.
CA Farmers Lose Billions Over Supply Chain Challenges
After already struggling with drought, California farmers have lost big overseas sales numbers because of a serious shortage of shipping containers brought on by COVID-19. A study from the University of California-Davis says the state’s farm belt lost $2.1 billion in exports during a five-month stretch this year because of “containergeddon.” A University of Connecticut study says the supply chain mess tying up world commerce has caused California growers 17 percent of their export sales from May to September. California nut tree farmers lost big, with estimates at $520 million, followed by the wine industry at $250 million and rice growers losing $120 million. Industry experts tell the Sacramento Bee that some export sales are gone and not just delayed. The tree nut market is very seasonal, with big demand at Christmas time, which is now gone for good. The U.C.-Davis report says the losses this year are larger than the financial damage done during the 2018 U.S.-China trade war.
USCA Leads Effort to Feed Communities Hit by Tornadoes
Monday Watch List
Markets
Still full of figgy pudding, grain traders returned Sunday evening at 7 p.m. CST and will be hawking over the latest weather forecasts. On Monday, other than USDA's weekly report of grain inspections at 10 a.m. CST, there are no other significant reports scheduled beyond the chance of a possible export sales announcement at 8 a.m. CST.
Weather
A system in the Midwest is pulling north into Canada, but there is another one waiting in the West that will move through again on Tuesday. Heavy snow has already fallen with the first over North Dakota, Minnesota and Wisconsin. The second should produce more moderate to heavy snow a bit farther southeast Tuesday. Meanwhile, cold, arctic temperatures are spilling into the Northern Plains, where they will be all week. And very warm weather is found down South and Southeast to end the year.
Thursday, December 23, 2021
Massachusetts Delays Effective Date of Question 3
Following approval by the Massachusetts Legislature, Governor Charlie Baker Wednesday signed into law a measure delaying implementation of the state's Question 3 initiative. Delayed until August 15, 2022, the 2016 ballot initiative, like California’s Proposition 12, will ban the sale of pork from hogs born to sows housed in pens that don’t comply with Massachusetts’ new standards. It applies to any uncooked pork sold in the state, whether it’s produced there or outside its borders. Nearly all pork currently produced in the United States fails to meet Massachusetts’ arbitrary standards. National Pork Producers Council President Jen Sorenson says, "Question 3, like Prop. 12, lacks any scientific, technical or agricultural basis and only will inflict economic harm on America's pork producers." In addition to delaying the initiative's implementation, the compromise measure requires the Massachusetts Department of Agricultural Resources to write rules and regulations for the law, in consultation with the state's attorney general within six months.
Canada Reports Atypical BSE Case
Canada recently reported a case of atypical bovine spongiform encephalopathy (in-sef-o-lop-athy) in an eight-year-old beef cow on a farm in Alberta. The Canadian Food Inspection Agency notified the World Organization for Animal Health of the case. Canada says the detection and reporting of an atypical BSE case will not affect the OIE negligible risk status of Canada, and market access for Canadian animals and beef products should be unaffected. However, South Korea, the fourth-largest beef importer in the world, suspended imports of Canadian beef and is seeking more information before lifting the suspension, according to Reuters. The case is atypical, meaning that it is a form of BSE that can occur naturally in older cattle, as opposed to classical BSE, caused by an animal eating contaminated feed. The cow was euthanized and did not enter the food system. The Canadian Government reports it is working with the beef industry to maintain the confidence of international trading partners.
Donations Announced for Tornado Outbreak, Kansas Wildfire Victims
Several of the country's leading agricultural cooperatives are mobilizing to support communities impacted by severe weather that swept the South and Midwest this month. AgFirst, CoBank, Farm Credit East, Farm Credit Illinois, Farm Credit Mid-America, Farm Credit Services of America, Farm Credit of Western Arkansas, Land O'Lakes, and Rural 1st have committed nearly $700,000 to national, state and local charities. The beneficiaries are the American Red Cross, Feeding America, the Kentucky Agriculture Relief Fund, the Kentucky Rural Electric Disaster Fund, the Tennessee Farm Disaster Response Fund, the Mayfield Tornado Relief Fund, and Rotary International Dresden, Tennessee. Meanwhile, Tyson Foods donated $100,000 in wildfire relief to Kansas farmers and ranchers. The Kansas Livestock Foundation is accepting donations to support farmers and ranchers impacted by the fire. The fires burned an estimated 400,000 acres across four counties, a region home to several cattle suppliers for Tyson Foods.
Culver’s "Thank You Farmers" Donations Surpass $3.5 Million
Culver's Thank You Farmers Project has now raised more than $3.5 million since its creation in 2013. In 2021, the program raised $500,000 toward its mission of advocating for the positive impact agriculture has on the world. Culver's reaches the milestone at a critical time, as the rapidly growing world population places increasing reliance on a climate-smart agricultural system to produce an abundant, nutritious food supply. Money raised through the project directly supports people making a positive impact in the industry, including those involved with local agriculture efforts in the communities Culver's calls home and larger, national projects advancing the industry. Culver's also took steps in 2021 to support the creation of a more resilient and sustainable agricultural future by joining the Decade of Ag Movement. The Decade of Ag Movement is the first food and agriculture sector-wide movement to create a shared vision for a climate-smart agricultural system.
Thursday Watch List
Markets
With U.S. futures markets closed Christmas eve, Thursday is the final day of the trading week and starts with USDA's weekly export sales report at 7:30 a.m. CST, the same time as U.S. jobless claims, U.S. personal incomes, durable goods orders for November and an update of the U.S. Drought Monitor. U.S. new home sales for November and the University of Michigan's consumer sentiment index for December are both set for 9 a.m. USDA's quarterly hogs and pigs report and December 1 cattle on-feed estimates are both due out at 2 p.m. CST. U.S. grain futures close at normal times Thursday and resume trading at 7 p.m. CST Sunday, December 26.
Weather
A large system is brewing in the western states Thursday. A piece of it will move through the Canadian Prairies and there are a few showers moving through the northern Midwest, but dry and warm conditions are expected for most areas east of the Rockies.
Wednesday, December 22, 2021
Deadline Extended to Apply for Pandemic Support for Organic Operations
The Department of Agriculture Tuesday extended the deadline for farmers who are certified organic, or transitioning to organic, to apply for pandemic assistance. The Organic and Transitional Education and Certification Program helps cover certification and education expenses. The deadline to apply for 2020 and 2021 eligible expenses is now February 4, 2022, rather than the original deadline of January 7, 2022. Certified operations and transitional operations may apply for eligible expenses paid during the 2020, 2021 and 2022 fiscal years. Signup for the 2022 fiscal year will be announced at a later date. For each year, the program covers 25 percent of a certified operation’s eligible certification expenses, up to $250 per certification category – crop, livestock, wild crop, handling and State Organic Program fee. This includes application fees, inspection fees, USDA organic certification costs, state organic program fees and more. Producers can learn more and apply through their local FSA office.
Wages, Input Costs and Supply Chain Problems Pushing up Pork Prices but Not Profits
University-level researchers say pork prices, not industry profits, are rising. Economists from Iowa State University and North Carolina State University released the report Tuesday with the National Pork Producers Council. The report shows prices are rising due to increased transportation costs, supply bottlenecks and delays and increased labor costs throughout the supply chain, caused or intensified by the COVID-19 pandemic. NPPC President Jen Sorenson says, “increased profits, whether at the retail, wholesale, or farm level, are likely not a significant contributor to the rising prices.” Other factors include a 2.5 percent loss in pork packing capacity that resulted from a federal court order stopping faster harvesting line speeds, higher energy costs, rising feed costs, and a shortage of workers, which hindered productivity and caused wages to increase. NPPC says the long-term outlook for labor, a critical factor in easing supply chain challenges and high prices, is dependent on future immigration policy and agricultural labor reform.
Stabenow: Trump USDA Picked Winners, Losers in Trade Damage Payments
The nonpartisan Government Accountability Office released a report this week on the implementation of the Department of Agriculture’s Market Facilitation Program in 2018 and 2019. The report shows that payments by USDA significantly overestimated the actual trade damages suffered by producers of eligible commodities. The report also found the calculation method USDA used in 2019 for payments to non-specialty crop producers resulted in higher payments for Southern farmers than producers of the same crop in other parts of the country. U.S. Senator Debbie Stabenow, A Michigan Democrat and Chair of the Senate Ag Committee, responds, “This report confirms that the Trump USDA picked winners and losers in their trade aid programs and left everyone else behind.” Stabenow added that making larger payments to farmers in the South than farmers in the Midwest or elsewhere, regardless of whether those farmers actually experienced a larger loss, undermines the future ability to support farmers when real disasters occur.
USDA Awards $500,000 to Texas A&M for International Fellowship Program
The Department of Agriculture Tuesday gifted Texas A&M University $500,000 this holiday season to establish international fellowship programs. The award is for the University’s Norman Borlaug Institute to establish and teach school-based programs in Guatemala through the International Agricultural Education Fellowship Program. Administered by USDA’s Foreign Agricultural Service, Administrator Daniel Whitley says the program will “help meet the food and fiber needs of Guatemalan communities.” That objective, according to Whitley, aligns with the Biden administration’s priorities for addressing the root causes of migration from the Northern Triangle region of Central America. Each Fellow will spend up to ten months in Guatemala during the 2022-2023 school year teaching agricultural skills and training youth at secondary schools and rural communities, activities that also support the U.S. Government Global Food Security Strategy. While on the ground, fellows will collaborate with existing U.S. Government projects to ensure synergy and to maximize benefits across programs.
Wednesday Watch List
Markets
At 7:30 a.m. CST Wednesday, third-quarter U.S. GDP will get its third estimate, followed by a report on November U.S. existing home sales and an index of consumer confidence at 9 a.m. The Energy Department's weekly inventory report is set for 9:30 a.m., likely to show another active week of ethanol production. USDA's monthly cold storage report will be released at 2 p.m. CST.
Weather
A system is moving into western states on Wednesday with showers spreading through the region, though concentrated toward the coast. Outside of the Northeast, all other areas will be dry during the day as conditions continue to be poor for winter wheat in the southwestern Plains.
Tuesday, December 21, 2021
USDA Expands Partnerships for Conservation
USDA is leveraging its authorities under the Conservation Reserve Enhancement Program to bring in new types of partners and expand opportunities in voluntary conservation. In direct response to feedback from stakeholders, USDA updated the program’s rule regarding matching fund requirements, and invested in additional staff to work directly with partners. The program is part of the Conservation Reserve Program and enables USDA’s Commodity Credit Corporation, through Farm Service Agency, and partners to co-invest in partner-led projects. The program also plays an important role in USDA’s broader climate change strategy, bringing together producers, landowners and partners for climate-smart land management. The rule also updated policy to provide a full annual rental rate to producers impacted by ordinances and regulations that require a resource conserving or environmental protection measure. At present, all partners are States. However, FSA is strongly encouraging Tribes and non-governmental organizations to consider partnerships. Currently, the program has 34 projects in 26 states, and more than 860,000 acres are enrolled.
USDA Seeks Nominations for Membership on Food Safety Advisory Committee
The Department of Agriculture's Food Safety and Inspection Service is soliciting nominations for membership to the National Advisory Committee on Meat and Poultry Inspection. USDA expects to appoint committee members in 2022. Agriculture Secretary Tom Vilsack says, "attracting and appointing individuals from diverse perspectives and expertise to serve on (the committee) will be essential to accomplishing our food safety goals." USDA seeks nominations from individuals with knowledge and interest in meat and poultry food safety and other FSIS policies. USDA also seeks representation of small and very small establishments and geographic diversity of members. Persons in academia, industry, state and local government officials, public health organizations, and industry and consumer organizations are invited to submit nominations, and self-nominations are welcomed. Established in 1971 by FSIS, the committee consists of 20 members and provides advice and recommendations to the Secretary of Agriculture on food safety concerns. Nominations packages must be received by February 18, 2022.
EPA Extends Expiration Deadline for Pesticide Applicator Certification Plans
The Environmental Protection Agency recently extended the expiration deadline for pesticide applicators certification plans. The 2017 Certification of Pesticide Applicators final rule had set stronger standards for people who apply restricted-use pesticides and required authorities with existing certification plans to submit proposed modifications by March 4, 2020, to comply with the updated federal standards. As specified in the rule, existing certification plans remain in effect until EPA completes its reviews and approves the proposed plan modifications, or until those plans otherwise expire on March 4, 2022. Due to the coronavirus pandemic, EPA is extending the existing plans' expiration deadline from March 4, 2022, to November 4, 2022. EPA has reviewed all proposed plan modifications and is making progress on sending agency comments to certifying authorities. To date, EPA has completed 45 final reviews of the 68 plans submitted by certifying authorities. During the extension, EPA and certifying authorities will continue to work together so that all plans meet the federal standards.
Fuel Prices Continue Decline Ahead of Christmas
The nation's average gas price declined for the sixth straight week, down 2.9 cents from a week ago at $3.30 per gallon. The national average is down 11 cents from a month ago and $1.09 per gallon higher than a year ago. The national average price of diesel declined two cents in the last week and stands at $3.58 per gallon. Patrick De Haan of GasBuddy says, “The decline in gas prices will likely continue until new Covid cases slow down.” De Haan says the U.S. may see Christmas gas prices fall just under their all-time high on the holiday, which was $3.26 in 2013. Beyond Christmas, with omicron cases likely to continue climbing, there will likely be a more noticeable hit on gasoline demand once the holidays are over. However, U.S. retail gasoline demand rose last week, likely as motorists get out and finish their gift buying ahead of Christmas. Nationally, weekly gasoline demand was up 2.9 percent from the prior week.
Tuesday Watch List
Markets
There are no official reports on Tuesday's docket, but traders will still check in on the latest weather forecasts and pause at 8 a.m. CST to see if USDA has an export sales announcement. Markets are typically quiet the week leading up to Christmas, but can also be vulnerable to unexpected moves, especially with outside markets nervous about the latest spread of coronavirus.
Weather
Two separate systems are bringing showers to the country on Tuesday. One is moving across the north with snow showers from the eastern Dakotas through Michigan. Another is moving across the Florida Peninsula with scattered showers in the Southeast. Other areas will remain dry; another day of poor conditions for winter wheat in the southwestern Plains.
Monday, December 20, 2021
Grassley: Investigation Needed in the Fertilizer Industry
Iowa Senator Chuck Grassley sent a letter to Attorney General Garland calling for the Department of Justice to investigate the fertilizer industry. American farmers are raising concerns about possible anti-competitive activity and market manipulation. Grassley says fertilizer is an essential input for farmers across the country, and without it, crop yields and agricultural productivity would get significantly smaller. “I have heard numerous concerns from Iowans and member organizations who are concerned that fertilizer companies are colluding and unfairly raising the price of their products,” Grassley writes in the letter. The industry has seen dramatic growth in prices: nitrogen fertilizer has doubled in price, anhydrous rose by 131 percent, urea by 110 percent, and potash up 120 percent. “The DOJ should investigate the fertilizer market so farmers across the country can get assurances that there are no violations of U.S. antitrust law in the fertilizer industry,” Grassley says. “Fertilizer tariffs are placing a huge financial burden on farmers.”
NCGA Wants Fertilizer Tariffs Ended
The National Corn Growers Association says one of the top fertilizer companies has erected an insurmountable barrier to keep top competitors out of the U.S. market. An NCGA letter says the barrier is hurting America’s farmers. NCGA and its state affiliates signed a letter sent to Mosaic, one of the nation’s top fertilizer producers. The letter takes Mosaic to task for the tariffs that were imposed in March by the International Trade Commission at the fertilizer company’s request. “Mosaic’s posture to date has been a masterpiece of irresponsible corporate social responsibility,” the letter adds. “Only 15 percent of phosphorous imports now come into the U.S. without tariffs.” The organization also points out that experts say using the Commerce Department and the Trade Commission to manipulate the supply curve does indeed dictate the price to farmers. The Corn Growers are asking Mosaic to reverse course and allow critical supply back into the U.S.
Transportation, Ag Departments Want Better Shipping Service for Agriculture
Transportation Secretary Pete Buttigieg (BUD-ah-judge) and Ag Secretary Tom Vilsack are asking the world’s leading ocean carriers to get rid of disruptions to agricultural shippers of American exports. They want relief for the supply chain disruptions created by COVID-19 by restoring reciprocal treatment of imports and exports and improving service. Ocean carriers have made fewer containers available for U.S. agricultural commodities. They’ve also repeatedly changed return dates and charged unfair fees as the ocean carriers short-circuited the normal pathways and rushed containers back to be exported empty. The poor service and refusal to serve customers is exemplified by many ocean carriers suspending service to the Port of Oakland. DOT and USDA are calling on carriers to utilize available terminal capacity more fully on the West Coast. They note that West Coast ports have excess capacity to alleviate supply-chain congestion. Restoring service to Oakland would ease congestion at the Ports of Los Angeles and Long Beach.
Australia and Britain Sign Free Trade Deal
Australia and Britain signed a free trade agreement late last week that will eliminate almost all tariffs between the two countries. The Associated Press says the deal gets rid of 99 percent of all taxes on exports. That will save Australia approximately $10 billion on exports like lamb, beef, sugar, and dairy. Britain is expected to save around $144 million a year on items such as cars, whisky, and cosmetics. Australia’s agricultural exporters also will get better access to the British market and $29 million a year of tariffs will get removed on Australian wines entering the United Kingdom. In announcing the deal, which takes effect in 2022, the nations say it will grow investments and help with the recovery from COVID-19. In making the announcement, the countries said, “Our economies will be able to operate seamlessly again. The experiences and opportunities that Australians and young Brits will be able to get through this initiative are fantastic.”
Senators Ask Administration to Take India Before WTO
More than a dozen senators sent a letter to Ag Secretary Tom Vilsack and U.S. Trade Representative Katherine Tai regarding India. They’d like the administration to pursue a World Trade Organization case against India’s domestic support for rice and wheat production. The U.S. has previously highlighted India’s non-compliance through counter-notifications at the WTO Committee on Agriculture. “American rice and wheat producers are operating at a clear disadvantage compared to their competitors, primarily from India, where the government is subsidizing more than half the value of production for rice and wheat,” says the letter to the administration. WTO regulations only allow just ten percent. “Wheat and rice farmers rely on open markets and fair trade to facilitate trade, which plays a vital role in supporting our growers and jobs in rural America,” says North American Wheat Growers Association CEO Chandler Goule. “It’s important that India lives by their international WTO commitments.”
USDA to Provide Aid to Help School Meals
The USDA will provide up to $1.5 billion to help school meal programs get through the supply chain crunch. USDA Secretary Tom Vilsack says procuring large amounts of food is more difficult because of shipment delays, a lack of particular products, the high cost of food, as well as labor shortages brought on by COVID-19. USDA is accessing the Commodity Credit Corporation for funding, providing $1 billion for schools to purchase food for their meal programs. Another $500 million will be distributed for the purchase of local foods to be distributed to schools. “This will result in a five percent increase in what school districts normally have available,” Vilsack says. The CCC was established in the 1930s, and it’s generally been tapped to provide subsidies for farmers, and it gives USDA broad authority to make direct payments to growers when prices are low. The number of American’s without enough food to eat remains higher than before COVID-19.
Monday Watch List
Markets
On Monday, December 20, five days before Christmas, a report on U.S. leading indicators in November is set for 9 a.m. CST, followed by weekly grain inspections at 10 a.m. Traders will monitor the latest weekly weather forecasts and watch for any export sales activity.
Weather
There is a system in the Gulf of Mexico and a weak system in the Pacific Northwest, each with some showers on Monday. But most of the country is looking at fairly calm and quiet conditions to start the week. Drought continues to build in the southwestern Plains and will be a detriment to winter wheat.
Friday, December 17, 2021
NBB Studies Benefits of the Biodiesel Tax Incentive
The National Biodiesel Board welcomed a new report titled “The Economic Benefits of the Biodiesel Blender’s Credit.” The report calculates annual economic benefits of $15 billion and environmental benefits of $4.3 billion from U.S. biodiesel production. The report says letting the current tax credit expire at the end of 2022 would harm the U.S. economy and the environment. It shows that the environmental benefits alone from each gallon of biodiesel that replaces petrodiesel exceed two dollars a gallon, or more than double the cost of the credit. Every 100 million gallons supports 3,200 jobs and $780 million in economic opportunity. The new report says eliminating the tax credit would cost up to 3,000 jobs in the biodiesel and renewable diesel industry, as well as another 7-to-9,000 jobs in the supply chain. Biodiesel use as recently as 2019 reduced greenhouse gas emissions by 18 million metric tons. The report says ending the credit would devastate the industry.
China Will Increase Pork Import Tariffs in 2022
The Chinese finance ministry says it will raise the import duties on most pork products in 2022. Reuters reports that the move comes after China rapidly expanded its domestic production and has less of a need for imports in the near future. The ministry will raise its tariff for most favored nations from the current eight percent to 12 percent on January 1. China had lowered its tariffs on frozen pork during 2020 as the country faced exploding domestic pork prices in the aftermath of the African Swine Fever outbreak. As a result, imports expanded to record highs and remained there through the first half of this year, even as the hog herd gradually recovered, and prices dropped below the cost of production in the third quarter. Most U.S. pork shipments to China face a 25 percent retaliatory tariff imposed during a trade war between the two countries, in addition to the most favored nation’s tariff.
Lawsuit Challenges Pesticide-Coated Seeds
Two environmental groups continued a five-year fight by suing the EPA to force it to regulate pesticide-coated seeds in the name of protecting bees and other pollinators. Seeds coated with neonicotinoid insecticides are used on 80 percent of corn acres and 40 percent of soybean acres. The EPA decided almost ten years ago that the seeds would not be regulated as pesticides as long as the coatings are registered, and the effect of the pesticides doesn’t extend beyond the seeds. In 2017, the Center for Food Safety petitioned the EPA to regulate coated seeds. However, the agency hasn’t taken any action on the petition since the public comment period ended in 2018. The lawsuit was filed in the U.S. District Court of San Francisco, and it requests the court to force the EPA to act on the petition within a 90-day window. CFS says pollinators are suffering grave harm while EPA fiddles.
NCBA Stewardship Award Program Seeks Nominees
The National Cattlemen’s Beef Association is looking for applications for its 2022 Environmental Stewardship Award. The program, established in 1991, annually recognizes the outstanding stewardship practices and conservation achievements of cattle producers across the nation. A common trait among all program winners is the desire to leave the land in better condition for future generations and inspire the next generation of land stewards. The award goes to producers who are actively working to protect and improve the environment because environmental stewardship and good business go hand-in-hand. Any individual, group, or organization is eligible to nominate one person or business raising or feeding cattle. Along with the application, one nomination letter and three letters of recommendation highlighting the nominee’s leadership in conservation are required for entry. Applicants do not have to be members of the NCBA. Applications are due by March 11, 2022. Seven regional winners will get recognized at the 2023 Cattle Industry Convention.
WTO Rules Against India Sugar Subsidies
The World Trade Organization ruled India is violating its WTO obligations with its sugar subsidies. A WTO panel initiated by Australia, Brazil, and Guatemala investigated India’s large sugar subsidies and found it not compatible with the country’s WTO commitments. The Hagstrom Report says an analysis done by the American Sugar Alliance notes that India is one of the largest sugar producers in the world. India produces over 30 million tons of milled sugar in most years with the support of government production subsidies and also uses export subsidies to place six to seven million metric tons of sugar on the world market. The ASA, which represents U.S. cane and beet producers, says the WTO found that India’s provision of domestic support to its sugarcane producers vastly exceeded the level permitted under WTO terms. “India has not been playing by the rules for years to the detriment of other producers,” says Rob Johansson, Director of Economics and Policy with ASA.
Pathway Now Open for Canola as Advanced Biofuels
The Environmental Protection Agency announced its regulatory agenda for this year, which includes designating renewable diesel fuels derived from canola oil as “advanced biofuels” under the RFS. “The NFU has long advocated for increased use of biofuels due to their tremendous benefits for the environment while providing much-needed market alternatives and economic stability to America’s farming and rural communities,” says Rob Larew, National Farmers Union President. In a recent letter to the USDA, the NFU calls for the administration to support increased growth of biofuel production, which will support increasing investments in rural communities and mitigate the effects of climate change. He says regulatory certainty is needed to expand production, remove any distortions in the market for canola oil, and make additional investments in processing. ”The EPA announcement is encouraging, and we urge prompt action to provide much-needed market alternatives and economic stability in rural America,” Larew adds. The rule-making will take place in January 2022.
Friday Watch List
Markets
There are no official reports on the docket for Friday, the week before Christmas eve, but surely the market will find some mischief to get into. Traders will keep an eye on the latest weather forecasts, outside markets and any news of an export sale.
Weather
A frontal boundary left over from a strong system on Wednesday will continue to be active from the southeastern Plains through the Ohio Valley on Friday. Scattered rain showers will soak some areas that are trying to recover from last week's severe weather. Dryness and drought continue to build in the southwestern Plains, which is unfavorable for winter wheat, a theme for the winter.
Thursday, December 16, 2021
USDA to Conduct Study About Agricultural Producers
The Department of Agriculture’s National Agricultural Statistics Service is conducting the 2021 Farm Producer Study. The study seeks to improve knowledge and understanding of agricultural producers and help USDA improve services to them. A brief questionnaire will mail this month to approximately 75,000 U.S. agricultural producers across the country. Taking no more than ten minutes to complete, the questionnaire asks participants for demographic and basic farm information. Census and Survey Division Director Barbara Rater says, “The results of the study may lead to more robust demographic data products.” NASS conducts studies like this to determine what questions to incorporate in future censuses and surveys. This study includes questions about race, ethnicity, gender, and disability status. By responding, farmers help paint a more complete picture of who they are and ensure agriculture in America is reflected as accurately as possible. Producers can respond securely online at agcounts.usda.gov or by mail. The deadline for response is January 18, 2022.
Report: Climate Change Contributed to Some of 2020’s Worst Weather
Scientists say human-caused climate change make extreme weather events more likely, according to new research published Wednesday in the Bulletin of the American Meteorological Society. The 10th edition of the report, Explaining Extreme Events in 2020 from a Climate Perspective, presents 18 new peer-reviewed analyses of extreme weather across the world during 2020. A National Oceanic and Atmospheric Administration study that examined the U.S. Southwest drought using several different model simulations found climate change may have increased the likelihood that the monsoon-season rains would fail as they did in 2020, reigniting a multiyear drought. One trend emerging in the past several years is several studies that find climate change is reducing the risk of certain types of extreme events, typically cold outbreaks or heavy precipitation. Stephanie Herring, a NOAA climate scientist, says, “This report reinforces the scientific consensus that human influence has created a new climate — one that is impacting extreme events today.”
Iowa Farmland Values up 29%
After several years of modest gains and losses, the average value of an acre of Iowa farmland skyrocketed 29 percent in 2021. The nominal value of an acre of farmland is now higher than at any point since Iowa State University began surveying values in 1941, and is 12 percent higher than the previous peak in 2013. However, the current value in inflation-adjusted terms is still lower than that for 2012 and 2013. The last time farmland values increased more than 25 percent was in 2011, when values rose 32.5 percent. An Iowa State University researcher says, “The increase this year is in part due to much stronger commodity prices thanks to higher exports, stronger than expected crop yields, and strong ad hoc COVID-19 related government payments.” The survey found that the average statewide value of an acre of farmland is $9,751, an increase of 29 percent, or $2,193, since 2020.
Perdue Farms Sends Donation, Meals to Kentucky, Ag Relief Programs Open
Perdue Farms is delivering $150,000 and 160,000 servings of chicken products to Kentucky residents impacted by the weekend tornado outbreak. The funds are going to the United Way of Kentucky Tornado Relief Fund and the meals are going to Feeding America, Kentucky's Heartland. Perdue's response is made possible through the company's "Delivering Hope To Our Neighbors" initiative focused in part on disaster relief, and improving quality of life and building stronger communities. Kevin Middletown, president of United Way of Kentucky, says, "This will mean so much to our neighbors who lost everything over the weekend.” Meanwhile, the Kentucky Farm Bureau has launched its KFB for Kentucky Relief Fund to aid the families and communities affected by the recent tornado outbreak. And the Kentucky Department of Agriculture has a resource webpage for impacted farmers. The page includes links to donation funds as well. You can find the resource page at kyagr.com/tornado/.
EPA Region 7 Announces Opportunity to Apply for Farmer to Farmer Grant Funding
The Environmental Protection Agency this week announced the availability of $12 million in funding to support historically underserved farmers within the Gulf of Mexico watershed. The funds are from the Farmer to Farmer grant program and were announced by EPA Region 7, which includes waters in the Gulf of Mexico watershed. Selected projects will work to increase collaboration among farming communities, while improving water quality, habitat, climate resilience, and environmental education through the demonstration of innovative practices on working lands. EPA plans to award four cooperative agreements, with up to $3 million of funding each. It is expected that grant awards may be issued for up to a five-year project period beginning May 2022. Successful applicants will be responsible for administering a competitive subaward grant program to directly collaborate with underserved farmers on projects in the Gulf of Mexico watershed. The request for applications period will end on February 4, 2022. View the funding opportunity on grants.gov.
USRSB Joins Trust In Beef
The U.S. Roundtable for Sustainable Beef joins the Trust In Beef program as a founding partner and technical advisor. Trust In Beef is a new effort to empower beef producers to accelerate the adoption of their sustainability journey and provide consumers with real-life proof of the continuously improving environmental performance of beef. The program is led by Farm Journal‘s social purpose division, Trust In Food, and its industry leading beef brand, Drovers. Debbie Lyons-Blythe, chair-elect of the U.S. Roundtable for Sustainable Beef, says, “Our members are committed to continuous improvement, which makes this partnership a great fit.” She says the Roundtable has paved the way to ranch-level sustainability progress with their science-based tools and frameworks. Trust In Beef will use their resources to connect beef producers with trusted guidance. Trust In Beef launched in Fall 2021 and supports 200,000 beef producers in accelerating continuous improvement in environmental performance, and providing that message to consumers.
Thursday Watch List
Markets
On Thursday, USDA's weekly report of export sales is due out at 7:30 a.m. CST, the same time as November housing starts, weekly U.S. jobless claims and an update of the U.S. Drought Monitor. A report on November U.S. industrial production is due out at 8:15 a.m., followed by natural gas storage at 9:30 a.m. Traders will pause at 8 a.m. to see if USDA will have this week's first export sale announcement.
Weather
A strong system that moved through the Plains and Midwest on Wednesday has moved into Ontario, Canada. There are still some effects from the storm including some stronger winds across the northern Midwest, but those will be waning through the day. The cold front to the system is stalling from Texas into the Ohio Valley, where showers will be more active. Much colder temperatures are building in behind the front, a stark contrast from record highs on Wednesday.
Wednesday, December 15, 2021
Bill to Block Retroactive Changes to RVOs Introduced
Report: U.S. Trade Falling Behind Global Competitors
The Corn Refiners Association Tuesday released a new report revealing the United States is behind its competitors in reducing global trade barriers. The report, which tracked trade agreements since 2010, shows several nations have outpaced the U.S. in the creation of new bilateral and multilateral trade arrangements, including China, Japan, the European Union, and Canada. At the same time, U.S. trade partners are pressing forward with new trade agreements without the U.S., risking diminished American economic competitiveness and investment opportunities. Corn Refiners Association President and CEO John Bode says, “We must act swiftly on these issues to reaffirm American leadership and maintain our status as a leading voice in global trade regulations and standards.” While the U.S. has completed four trade agreements since 2010, including the modernization of an existing agreement, China has entered into ten new agreements, Japan has entered into seven, the EU has entered into eight, and Canada has entered into eight.
Coalition: Ag Labor Must be Exempt from Travel Restrictions
A coalition of more than 60 agriculture groups led by the American Farm Bureau Federation requests agricultural workers be exempted from travel restrictions from South Africa. In a letter to the Biden administration, the coalition says, “While protecting our nation from new variants of COVID-19 is critically important, it is in our national interest to ensure production of food, fuel and fiber.” Specifically, the groups ask Secretary of State Antony Blinken and the Homeland Security Department to give National Interest Exceptions to H-2A workers coming to the United States as outlined in the proclamations as an exception to the travel restrictions. The agriculture groups say almost 7,000 guestworkers originate from South Africa, and the majority of them arrive in the U.S. in February, March and April. Many of these H-2A workers have a unique skillset, and American farmers are counting on their timely arrival as they make plans for their upcoming growing seasons.
Newhouse Introduces Legislation to Increase Food Donations
U.S. Representative Dan Newhouse this week introduced legislation to expand food donation efforts across the country. Fellow Republican Jackie Walorski of Indiana, along with Democrats Jim McGovern of Massachusetts and Chellie Pingree of Maine, joined Newhouse of Washington state to introduce the bill. The bipartisan Food Donation Improvement Act would encourage food donation efforts by extending liability protections to food donors when food is either given directly to a person in need or when a recipient pays a deeply reduced cost. Expanding the protections would allow retail grocers, wholesalers, agricultural producers, restaurants, caterers, school food authorities, and higher education institutions to increase the quantity and efficiency of their food donation efforts. The bill would also clarify labeling standards that food products must meet to be eligible for liability protections. Newhouse says the legislation “will enact logical reforms that will provide clarity and protections to farmers, retailers, and non-profits seeking in good faith to assist the hungry.”
Deere Expands Footprint with Chicago Office
Deere & Company this week announced the expansion of its U.S. footprint with the opening of a new Chicago office. The company plans to add 150 information technology jobs at the office over the next two years, with the goal of hiring a total of 300 positions to support IT and additional roles. The facility will target IT capabilities in eCommerce, cloud, data and analytics, and a variety of innovation-related technical skills. Illinois Governor JB Pritzker says, "John Deere's new technology center in Chicago is just one example of the innovation and investment Illinois is inspiring with our top-tier talent and world-class infrastructure." The new space, located in the fast-growing Fulton Market neighborhood, will allow Deere to recruit from the deep bench of diverse talent in Chicago and provide them with the flexibility of in-person collaboration. The new office is expected to open in late summer or early fall of 2022.
Applications Sought for Renewed Effort to Assist Farmers
American Farmland Trust is accepting applications to help farmers nationwide to improve farm viability, access, transfer or to permanently protect farmland or adopt regenerative agricultural practices. AFT’s Brighter Future Fund provides grants of up to $5,000 per project. A project may involve one or more individual farmers or farm families, and only one grant can be awarded per farm family. David Haight, AFT Vice President of Programs, says, "This year, the program will focus exclusively on providing resources to producers who have faced systemic barriers in our agricultural system." The Brighter Future Fund launched in 2020 to help farmers launch, grow and sustain farms in the face of forces impacting the food and agricultural system, including the COVID-19 pandemic, changing markets, severe weather and climate change. Applications will be reviewed and awarded in the order the applications are received based on eligibility. To apply, farmers should submit a completed electronic Brighter Future Fund Application to AFT at www.farmland.org
Wednesday Watch List
Markets
Wednesday's reports start with U.S. retail sales in November at 7:30 a.m. CST, followed by the Energy Department's weekly inventory report at 9:30 a.m. The National Oilseeds Processors Association will give its monthly soybean crush report later Wednesday morning. Many will be watching as the Federal Reserve makes its post-meeting announcement at 1 p.m., followed by USDA's Livestock, Dairy and Poultry outlook at 2 p.m.
Weather
A potent storm system will kick up incredibly strong wind gusts across the Plains and Upper Midwest Wednesday, especially this afternoon and evening. Wind gusts may exceed 70 mph for large areas of the Central Plains into Iowa and northwest Missouri with gusts approaching or exceeding 60 mph elsewhere in the region. There should also be enough ingredients to produce severe weather from eastern Nebraska into the Upper Midwest late this afternoon and evening. Strong winds and a couple of tornadoes are likely. Some snow will develop on the backside of the system, but only a couple of inches is expected as the system quickly moves out of the region Wednesday night. Temperatures crashing behind the system will produce flash-freezes that will create hazards for standing water from rain and melted snow.
Tuesday, December 14, 2021
Farmers Struggle with Skyrocketing Fertilizer Prices
Fertilizer prices continue to skyrocket, as much as 300 percent in some areas, as farmers grapple with increased costs as they prepare for the 2022 growing season. The American Farm Bureau Federation’s latest Market Intel examines the short- and long-term factors impacting fertilizer supply and demand. Farm Bureau economists found several elements are contributing to record-high prices. Those include Increased prices for raw nutrients, increased demand, higher energy costs, supply chain issues and trade duties. Farm Bureau President Zippy Duvall says, "We urge the Biden administration to look for ways to bring fertilizer prices down, which include resolving supply chain disruptions and removing import duties." The Market Intel found that compared to September 2020 prices, ammonia has increased over 210 percent, liquid nitrogen has increased over 159 percent, urea is up 155 percent, MAP has increased 125 percent, while DAP is up over 100 percent, and potash has risen above 134 percent.
USDA Provides Additional Pandemic Assistance to Hog Producers
The Department of Agriculture Monday announced a new program to assist hog producers who faced reduced market prices due to the COVID-19 pandemic. The Spot Market Hog Pandemic Program is part of USDA’s Pandemic Assistance for Producers initiative and addresses gaps in previous assistance for hog producers. The program assists hog producers who sold hogs through a negotiated sale from April 16, 2020, through September 1, 2020. USDA is offering the program as packer production was reduced by the COVID-19 pandemic due to employee illness and supply chain issues, resulting in fewer negotiated hogs being procured and subsequent lower market prices. Payments will be calculated by multiplying the number of head of eligible hogs, not to exceed 10,000 head, by the payment rate of $54 per head. FSA will issue payments to eligible hog producers as applications are received and approved. Eligible hog producers can apply starting December 15, 2021, by contacting their local USDA Service Center.
Report: E15 Ready to Fuel 98 Percent of U.S. Miles Traveled
A new report from Growth Energy Monday showcases nearly universal compatibility with fuel blended with 15 percent ethanol, or E15, among vehicles on the road today. Growth Energy CEO Emily Skor says, “This report confirms that better access to lower-cost E15 could save motorists money on 98 percent of all vehicle miles traveled in the United States.” E15 is approved by the EPA for use in all light-duty vehicles model year 2001 and newer. Based on the current vehicle fleet and sales over the past year, the new report shows that E15 is approved for 96 percent of light-duty cars and trucks on the road, nearly 246 million vehicles. The data combines with other research illustrating that nationwide E15 could slash emissions by 17.62 million tons per year. The report was prepared by Air Improvement Resource, Inc., a leading engineering and consulting firm specializing in inventory modeling and analysis, at the request of Growth Energy.
AEM Releases November 2021 Equipment Sales Numbers
Sales growth in both tractors and combines continues in the U.S., while a slowdown in harvesters in Canada brings overall unit sales slightly below 2020 north of the border. The Association of Equipment Manufacturers reports U.S. total farm tractor sales climbed 8.7 percent in November compared to 2020, while combine sales saw a gain of 37.8 percent, the fourth month in a row of growth near or above 20 percent for harvesters. For Canada, November monthly were a mixed bag, with tractors climbing 1.3 percent in aggregate, while harvesters fell 56.8 percent, bringing combined tractor and combine sales down 0.7 percent, or 18 total units. Still, both tractors and combines remain above 20 percent growth year-to-date in Canada, with tractors up 20.5 percent, and combines up 28.1 percent. AEM’s Curt Blades adds, “While supply chain issues are still causing some bumps, our members continue to do all they can to deliver the parts and products to the market.”
Restaurant Menu Price Inflation Reaches 39-year High
Restaurant menu price inflation hit a 39-year high last month as high costs for food and labor continue. Restaurant Business, a commercial foodservice industry publication, reports limited-service restaurant prices rose 7.9 percent, while full-service increased six percent. The data stems from the U.S. Labor Department’s Consumer Price Index released last week. Several factors are contributing to the inflation, but a dramatic spike in wages is the top issue. Wages are up 14 percent this year, nearly three times the overall rate of inflation, according to Restaurant Business sister company Technomic. Labor problems are causing major disruptions in the supply chain, making it difficult for meat processors to get enough staff to produce chicken or beef and leaving distributors without enough drivers to get goods to restaurants. These levels of menu price inflation typically push consumers away from restaurants. But grocery prices are not much better and have outpaced restaurant inflation for each of the past three months.
USDA Study: Black Beans Help Fix Insulin Resistance
Adding cooked black beans to a high-fat diet improved sensitivity to insulin and other measures often related to diabetes, according to a USDA Agricultural Research Service study. As little as the mouse-sized equivalent of a single serving a day of black beans—about a half cup for a human—lowered insulin resistance 87 percent. A USDA researcher says, “This research suggests that eating even a small amount of black beans can have multiple health benefits.” Mice on the high-fat plus black beans diet also decreased LDL cholesterol, the so-called bad cholesterol, 28 percent and triglyceride levels 37 percent compared to mice eating a high-fat diet without black beans. Other diabetes-related biomarkers were all significantly better in the mice on the high-fat plus black beans diet. Black beans are generally low in fat and high in fiber and protein. They are popular in Latin American, Mexican and Caribbean cuisines as well as in Cajun and Creole cooking.
Tuesday Watch List
Markets
Tuesday, the Labor Department's producer price index for November is set for release at 7:30 a.m. CST. Traders will keep an eye on the latest weather forecasts and pause at 8 a.m. CST for a possible export sale announcement. December grain futures contracts expire early.
Weather
A storm system continues to build across the West with heavy precipitation. Most areas east of the Rockies will be dry and warm with temperatures well above normal. The combination is bad for winter wheat in the southwestern Plains where drought continues to grow
Monday, December 13, 2021
Consumer Price Index Continues Increase
The Consumer Price Index increased 0.8 percent in November after rising 0.9 percent in October. The U.S. Bureau of Labor Statistics released the data Friday. Over the last 12 months, the all items index increased 6.8 percent before seasonal adjustment. The food index increased 0.7 percent in November after rising 0.9 percent in both September and October. The food at home index increased 0.8 percent in November as all six major grocery store food group indexes rose. The rise represents the third consecutive month that all six increased. The food at home index rose 6.4 percent over the past 12 months, the largest 12-month increase since December 2008. The food away from home index rose 0.6 percent in November, following a 0.8-percent increase the prior month. The index for limited-service meals continued to rise sharply, increasing 1.0 percent over the month, while the index for full-service meals rose 0.4 percent in November.
CoBank Releases 2022 Year Ahead Economic Report
The U.S. economy is poised to slow in 2022 relative to 2021, but economic growth will continue at an above-average pace. CoBank last week released its 2022 year ahead report, examining several key factors that impact agriculture and market sectors that serve rural communities. CoBank suggests the U.S. farm economy will continue to struggle with the ongoing supply chain dysfunction and cost inflation issues that emerged in the summer of 2021. Historically strong prices will be more than offset by increases in cost structure for nearly all crop production, including row crops, fruits and vegetables, and hay. CoBank economists do not anticipate any significant pullback in farm-level costs until the fall of 2022, at the earliest. The expected decline in direct government payments in 2022 will further squeeze farm income statements. The single biggest wildcard for U.S. agriculture is export sales to China, currently the largest export market for U.S. farm products.
USDA Withdraws Proposed Horse Protection Rule
USDA's Animal and Plant Health Inspection Service Friday announced the withdrawal of a 2016 proposed rule that would have amended the Horse Protection Act regulations. APHIS is making the development of a new and improved proposal a top regulatory priority. The action allows the agency to evaluate and consider more recent findings and research and incorporate the information into a new proposed rule. A 2021 National Academies of Sciences study examined the inspection methods used for identifying soreness in walking horses, new and emerging approaches for detecting pain, and use of the scar rule in determining compliance with the Horse Protection Act. The report also made several science-based recommendations that APHIS will consider. APHIS determined that the proposed rule does not sufficiently address the report's findings and believes that the 2016 proposed rule's underlying data should be updated. Following withdrawal of the 2016 proposed rule, APHIS intends to issue a new proposed rule quickly.
FSIS Seeking Proposals to Control Salmonella in Poultry Processing
USDA's Food Safety and Inspection service seeks proposals from poultry processors for pilot projects that will test different control strategies for Salmonella contamination. FSIS, in a constituent update Friday, said participating processors will experiment with new or existing pathogen control and measurement strategies and share data collected during the pilots with FSIS. The data will be analyzed to determine whether it supports changes to FSIS existing Salmonella control strategies. The agency announced in October it would be mobilizing a stronger and more comprehensive effort to reduce Salmonella illnesses associated with poultry products. FSIS will consider proposals from all active poultry establishments, or parent corporations, that produce raw products subject to FSIS Salmonella performance standards. Key partners such as breeders, live animal producers, and allied businesses are encouraged to assist in the projects. Proposals will consider new or existing control and measurement strategies for controlling Salmonella before and after harvesting of live birds.
Long-Term Productivity Growth Varies Across Countries
Total factor productivity growth for agriculture varies across countries, according to fresh data from USDA’s Economic Research Service. Total factor productivity growth reflects the rate of technological and efficiency improvements in agriculture. The data measures the amount of agricultural output produced from the combined set of land, labor, capital, and material resources employed in the production process. Strengthening the capacity of national agricultural research and extension systems to develop and deliver new agricultural technologies to farmers has been a critical factor in raising agricultural productivity. Information from the International Agricultural Productivity data product and related ERS research shows that Brazil and India's growth can be attributed to long-term investments in agricultural research. China's growth can be attributed to investments in research and institutional and economic reforms. In contrast, Russia's low rate of agricultural growth is attributed to inefficiencies under a planned economy until 1991, followed by economic disruptions that accompanied its transition to a market economy.
ASA Elects 2022 Executive Committee
During its annual meeting in St. Louis last week, the American Soybean Association elected the leaders who will steer the organization. Brad Doyle of Arkansas will serve as 2022 ASA president. Doyle previously served as ASA vice president, secretary, and an at-large executive committee member. He has been on the ASA board of directors since 2017. Immediate past president Kevin Scott of South Dakota moves to the role of ASA chairman. Former chairman Bill Gordon of Minnesota rotates off the nine-member executive committee and retires from the board. The ASA board elected Daryl Cates of Illinois as ASA vice president, a role that puts him in line to serve as the association’s president in 2023. In addition, the board elected Caleb Ragland of Kentucky as ASA secretary and North Dakota’s Josh Gackle as treasurer. At-large members of the executive committee include Stan Born of Illinois, Minnesota’s George Goblish, Ronnie Russell of Missouri, and Scott Metzger from Ohio.
Monday Watch List
Markets
Following Thursday's WASDE report, USDA's Economic Research Service will issue updates to their crop outlooks Monday. The updates are not market-moving events but provide additional supporting information. Otherwise, after USDA's weekly grain inspections report at 10 a.m. CST, there are no significant reports Monday. The latest weather forecasts and any export sales news will get their usual attention.
Weather
A strong storm system is building in the West early this week that will bring widespread heavy precipitation to the region, helping to reduce drought. Drier and warmer weather eastward should help to melt snow across the northern tier, and aid in recovery efforts where severe weather and devastating tornadoes went through Friday night.
Friday, December 10, 2021
House Passes Bills Promoting Livestock Market Transparency
Groups like the National Cattlemen’s Beef Association are pleased the House of Representatives passed two bills that provide producers with greater transparency in the cattle markets. The House voted 418-9 to advance legislation that would extend the authorization for Livestock Mandatory Reporting through September 30, 2022. The authorization for LMR is the most important tool cattle producers have for understanding transactions and trends in the cattle markets. By a 411-13 vote, the House also passed the Cattle Contract Library Act. “LMR is absolutely essential to fair, competitive, and transparent cattle markets,” says NCBA President Jerry Bohn. “We’re also grateful that producers will have access to vital market data through the cattle contract library.” NCBA also says the creation of a cattle contract library and reauthorization of LMR are both widely supported across the cattle and beef industry. The organization appreciates the heavy engagement of lawmakers from both sides of the aisle on the transparency issue.
House Takes Action on Supply Chain Disruptions
The House passed the Ocean Shipping Reform Act to try and solve some of the challenges in the U.S. supply chain. In recent months, ocean liners from China and other countries have been returning to their home ports empty after delivering to the U.S., making it hard for U.S. agriculture to export commodities. Among the many functions of the legislation, it would prohibit ocean carriers from unreasonably declining opportunities, as determined by the Federal Maritime Commission in new required federal rulemaking. The U.S. Dairy Export Council, the National Milk Producers Federation, and other ag groups supported the bill. “This legislation would help alleviate delays and disruptions at U.S. ports that have cost the U.S. dairy industry well over $1 billion this year,” says the dairy groups. “Since late 2020, America’s dairy exporters have contended with challenges in securing shipping containers, record-high fees, and shipping access volatility, most of which is driven by foreign-owned carriers.”
Corn, Soybean Numbers “Neutral” in December WASDE
USDA’s December World Ag Supply and Demand Estimates report was called “neutral” for corn and soybeans and bearish for wheat. This month’s 2021-2022 U.S. corn supply and use outlook is unchanged from November. USDA kept corn for ethanol use at 5.25 billion bushels despite forecasts of strong demand and higher production. Corn ending stocks are projected at 1.49 billion bushels, and the season-average farm price is still $5.45 a bushel. Soybean supply and use projections also remain unchanged. Although soybean crush is unchanged, soybean oil production is raised because of a higher extraction rate. The season-average U.S. soybean price is unchanged at $12.10 per bushel. Lower exports caused USDA to push up ending wheat ending stocks to an unexpected 598 million bushels. USDA also dropped wheat imports by five million bushels but left all other supply and demand factors at November levels. The season-average farm price rose 15 cents to $7.05 a bushel.
USB Elects New Chair
Farmer-leaders of the soybean checkoff elected Ralph Lott of Seneca Falls, New York, as the 2022 Chair during their December meeting in St. Charles, Missouri. “With a productive growing season, favorable soybean prices, and increased demand in 2021 amid supply chain constraints, this is an exciting and pivotal time for U.S. Soy, both domestically and internationally,” Lott says. “I appreciate the support of my fellow board members, and I am eager to work with them to identify initiatives that grow our markets and bring value back to the farm.” The new United Soybean Board Chair also says he’s looking forward to continuing the board’s success of making judicious soy checkoff investments in addressing both immediate and long-term supply and demand opportunities and driving resiliency for U.S. soy farmers. Meagan Kaiser of Missouri was elected as the Vice-Chair. Key USB success from this year includes U.S. soybeans getting used as an active ingredient in more than 1,000 products.
Beef Export Value Shatters Records
October was a strong month for U.S. red meat exports. USDA data compiled by the U.S. Meat Export Federation shows beef export value continued to soar. October’s pork exports were well below last year’s large total, but year-to-date shipments remained slightly above the record pace of 2020. Beef exports reached 115,700 metric tons in October, while export value climbed 48 percent to $957 million, the second-highest total on record. Only August of this year was higher. January through October exports hit 1.19 million metric tons, up 17 percent from 2021. Beef exports will top $2 billion in three key markets, including South Korea, Japan, and China/Hong Kong. Pork exports totaled 226,200 metric tons in October, while export value dropped 3.5 percent to $618 million. Through the first ten months of the year, pork exports were slightly higher in volume than last year. Exports to Mexico hit a new monthly high in October at 84,000 metric tons.
Groups Ask EPA to Fix Summertime E15 Block
Six national farm and biofuel organizations want the Environmental Protection Agency to enact regulations that help facilitate year-round sales of E15 nationwide. They’d like regulations that require lower-volatility conventional gasoline blend-stock in the summer. The groups say the move would result in lower tailpipe and evaporative emissions during the summer ozone control season and improve air quality. In a letter to EPA Administrator Michael Regan, the groups say reducing the volatility of gasoline by just one pound per square inch would yield significant environmental benefits. They attached a new study using EPA modeling tools to the letter showing that reducing the vapor pressure of conventional gasoline blend-stock by 1 psi would be beneficial to air quality as carbon monoxide emissions, nitrogen oxides, and other volatile organic compounds would be reduced. If the 1-psi waiver for E10 is eliminated and E10 is replaced with E15, it will also decrease greenhouse gases and particulate emissions.
Friday Watch List
Markets
The Labor Department will release the November consumer price index at 7:30 a.m. CST, a hot topic after October prices were up 6.2% from a year ago. Traders will keep an eye on the latest weather forecasts and pause at 8 a.m. CST for a possible export sale announcement. The University of Michigan's consumer sentiment index for early December follows at 9 a.m. The U.S. Treasury reports on the federal budget for November at 1 p.m. CST. .
Weather
A storm system working out of the Rockies and into the Plains is developing heavy snow across Wyoming to southern Minnesota already. That band will expand throughout the day and extend farther into Wisconsin as the low pressure center moves into the Midwest tonight. Scattered showers and thunderstorms will develop later in the day from the far eastern Plains through the Delta and Midwest, where severe thunderstorms will be possible. Strong winds are already having an impact in the southwestern Plains but should increase across much of the middle of the country today as well.
Thursday, December 9, 2021
Critics Say EPA RVO Announcement Includes Unprecedented Revisions
Critics of the Environmental Protection Agency’s renewable volume obligations announcement say the proposal sets the precedent of revising previously finalized volumes in the Renewable Fuel Standard. EPA proposes to retroactively reopen and reduce the finalized 2020 renewable volume obligation, slashing the already settled conventional biofuel blending volume for that year from 15 billion gallons to 12.5 billion gallons. Iowa Corn Growers Association President Lance Lillibridge says, “Biden's own EPA is undercutting the benefits of clean-burning ethanol and the livelihoods of corn farmers.” Iowa Senator Chuck Grassley responds, “The administration’s unprecedented plan to retroactively cut blending levels for previous years is a boon for Big Oil,” adding, “What’s to stop the administration from slashing 2022 obligations down the line?” If the proposal is finalized, industry groups expect lengthy litigation against the EPA over the action. And some see the proposal as further proof for the need to pass the Next Generation Fuels Act.
$800 Million Available to Provide Economic Relief to Biofuel Producers
The Department of Agriculture this week announced its relief program for biofuel producers, in conjunction with the Environmental Protection Agency’s volume announcement. USDA says up to $800 million will support biofuel producers and infrastructure, a long-awaited announcement authorized by the CARES Act. The funding includes $700 million to provide economic relief to biofuel producers and restore renewable fuel markets affected by the pandemic and $100 million for expanding infrastructure for renewable fuels. Agriculture Secretary Tom Vilsack says the program will “pave the way to economic recovery for America’s biofuel producers,” along with stimulating a critical market for U.S. farmers. Through the Biofuel Producer Program, USDA will make direct payments for biofuel producers who faced unexpected market losses due to the pandemic. USDA will announce the official application window for this program within the coming week. The infrastructure program funds grants for biofuels infrastructure, such as blender pumps which ensure biofuels have greater availability in the retail market.
USDA Opens 2022 Sign-up for Dairy Margin Coverage
The Department of Agriculture Wednesday announced the sign-up period for the Dairy Margin Coverage. USDA also expanded the program to allow dairy producers to better protect their operations through supplemental production. This sign-up period, which runs from December 13, 2021, to February 18, 2022, enables producers to get coverage through the safety-net program for another year as well. The Supplemental DMC will provide $580 million to better help small- and mid-sized dairy operations that have increased production over the years but could not enroll the additional production. Now, they will be able to retroactively receive payments for that supplemental production. USDA is also changing the DMC feed cost formula to better reflect the actual cost dairy farmers pay for high-quality alfalfa hay. FSA will calculate payments using 100 percent premium alfalfa hay rather than 50 percent. The amended feed cost formula will make DMC payments more reflective of actual dairy producer expenses.
USGC Releases 2021 Corn Harvest Quality Report
The U.S. Grains Council released this week the 2021/2022 Corn Harvest Quality Report. The report is based on 610 samples taken from defined areas within 12 of the top corn-producing and exporting states. USCG revealed that revealed this year's U.S. corn crop has a higher average test weight and lower total damage and stress cracks compared with the previous five crops. The 11th edition of the report showed the 2021 crop was planted earlier than average and experienced a mostly warm growing season. Overall, 65 percent of the crop rated as good or excellent condition, nearing record high yields. The average aggregate quality of the representative samples tested was better than the grade factor requirements for U.S. No. 1 grade. Nearly 99 percent of the samples tested below the U.S. Food and Drug Administration action level for aflatoxins. And the 2021/2022 U.S. corn crop is expected to be the second-largest on record and has the highest average yield on record.
New Report Finds Unmet Demand for Afterschool Programs
A new report finds Just 11 percent of America’s rural children are enrolled in an afterschool program. For every rural child in an afterschool program, four more are waiting to get in. The report, Spiking Demand, Growing Barriers, is based on a household survey conducted by Edge Research for the Afterschool Alliance. It finds a drop in rural children enrolled in afterschool programs from 13 percent, or 1.19 million rural kids, enrolled in 2014 to just 11 percent, or 1.15 million kids, enrolled in 2020. The drop mirrors national trends on afterschool participation as public funding for afterschool programs has not kept up with demand. The new study finds that cost and transportation are significant barriers that prevent many rural parents from enrolling their child in an afterschool program. Afterschool Alliance Executive Director Jodi Grant says, “Increasing access to both afterschool and summer learning programs must be an urgent priority for lawmakers and funders.”
USDA, Boehringer Ingelheim, Expand Research Opportunities for Veterinary Students
Boehringer Ingelheim and USDA’s Agricultural Research Service are joining forces to offer veterinary students the opportunity to research diseases that could affect livestock and public health. The collaboration expands the Boehringer Ingelheim-led Veterinary Scholars Program, which has provided stipends to more than 3,500 veterinary students in the last 30 years. The expansion will create opportunities for up to 12 students to spend the summer at one of nine USDA sites working with an ARS scientist on a research project in livestock infectious diseases. Boehringer Ingelheim and USDA will cover all costs for the students, including costs associated with traveling to and from their schools to the USDA centers. After spending the summer conducting research and learning from USDA scientists, students will attend and present their work at the 2022 National Veterinary Scholars Symposium, hosted by the University of Minnesota’s College of Veterinary Medicine in St. Paul, Minnesota. More information and the application are available at boehringer-ingelheim.com.
Thursday Watch List
Markets
USDA's weekly export sales report is due out at 7:30 a.m. CST, the same time as weekly jobless claims and an update of the U.S. Drought Monitor. Traders will watch for a possible export sales announcement at 8 a.m. and the Energy Department's report on natural gas storage is set for 9:30 a.m. USDA's December WASDE report comes out at 11 a.m. CST, expected to show only small changes, if any.
Weather
A weak system moving through Canada is producing some showers for the northern Midwest Thursday, but amounts will be fairly light. Another storm moving through the western states is bringing some better showers to drought-afflicted areas. But dryness in the Southern Plains continues to be a concern for winter wheat, especially when you factor in the warm temperatures.
Wednesday, December 8, 2021
EPA Announces Long-Awaited RVOs
The Environmental Protection Agency announced a package of actions, including setting the Renewable Volume Obligations for 2022, 2021, and 2020. The agency also introduced regulator changes intended to enhance the program’s objectives. For 2022, the EPA is proposing the highest total volumes in history, putting the program on a stable trajectory that provides for significant growth. The proposed volume for 2022 is over 3.5 billion gallons higher than the volume of renewable fuel used in 2020. The proposed volume for advanced biofuels in 2022 is over one billion gallons greater than the volume used in 2020. EPA is also proposing to deny dozes of petitions to exempt small refineries from the obligations under the RFS. “Despite multiple challenging dynamics affecting the RFS program in recent years, EPA remains committed to the growth of biofuels in America to secure a clean zero-carbon energy future,” says EPA Administrator Michael Regan.
Farmer Sentiment Weakens on Cost Concerns
The Purdue University/CME Group Ag Economy Barometer dropped five points in November to a reading of 116. Producers continue to be pessimistic about both the current and future outlook of the agricultural economy. Farmers are facing sharp increases in their cost of production that coincide with fluctuating crop and livestock prices. Other issues of concern are the prospect of changing environmental and tax policy, the uncertainty brought on by COVID-19, and a host of other issues that are all driving down farmer sentiment. The Farm Capital Investment Index shows 47 percent of respondents listing higher input costs as their biggest concern in the upcoming year. The Farm Financial Performance Index rose two points in November, helped by strong fall crop yields and stronger wheat prices. Producers remain optimistic about farmland values over the next 12 months and the next five years. Over half the farmers surveyed expect cash rental rates to rise in 2022.
Groups Unite on Clear Labeling of Cell-Based Protein
The Hagstrom Report says it’s rare for the National Cattlemen’s Beef Association, the Center for Food Safety, and the National Chicken Council to be on the same page. However, all three groups are asking the USDA to clearly label meat and poultry products that contain lab-grown animal cells. The USDA’s Food Safety and Inspection Service is working to develop a regulatory structure for lab-grown meat. NCBA says that the term “beef” should only be on products that come from livestock raised by farmers and ranchers. The NCBA also did a study on consumer understanding of lab-grown meat which showed only 13 percent were aware of the products. When asked to provide a definition after hearing several choices, only ten percent of the respondents gave an accurate definition of the products. The CFS says, “Synthetic products comprised of cultured animal cells must be clearly differentiated from slaughtered meat before they’re marketed.”