Agriculture Secretary Tom Vilsack Wednesday announced a $3 billion comprehensive set of investments to address challenges facing farmers and ranchers. USDA says the investments will support drought resilience and response, animal disease prevention, market disruption relief, and purchase food for school nutrition programs. The support will be made available via the Commodity Credit Corporation. Specifically, the package includes $500 million each for drought, African swine fever, and market disruptions, and up to $1.5 billion to provide assistance to help schools respond to supply chain disruptions. Secretary Vilsack also outlined and requested public comments on a new climate partnership initiative designed to create new revenue streams for producers via market opportunities for commodities produced using climate-smart practices. Vilsack adds, “Today, we ask for public input to inform our decision making and enhance the design of this initiative.” USDA is seeking input specifically on the current state of climate-smart commodity markets, systems for quantification, and potential protocols, among other topics.
Welcome
Thursday, September 30, 2021
NPPC Welcomes USDA Investment on ASF Prevention
The Department of Agriculture’s Wednesday investment includes $500 million in USDA Commodity Credit Corporation funds for prevention of and preparation for African swine fever. The National Pork Producers Council applauded the funding as President Jen Sorenson says ASF is a serious disease, with serious consequences, adding, “We’re pleased USDA recognizes the severity of this threat.” ASF is not a threat to people but is highly contagious among hogs and has a nearly 100 percent mortality rate. ASF was recently detected in the Dominican Republic and Haiti, the first time in 40 years the disease has been in the Western Hemisphere. APHIS immediately took steps to stop the spread of the disease to the U.S. mainland and to the U.S. territories of Puerto Rico and the U.S. Virgin Islands. Since ASF began spreading through Asia in 2018, NPPC has urged Congress and USDA to prepare for the disease, asking for funding and measures to protect the U.S. hog herd.
Joint Initiative Seeks to Promote Competition in the Beef Supply Chain
The American Antitrust Institute and Organization for Competitive Markets this week announced a new joint initiative, “Breaking the Market Power Bottleneck in U.S. Beef: A Roadmap for Building an Independent Ranching and Processing Sector.” The initiative seeks to promote competition in the U.S. beef supply chain and supports the competition policy initiatives recently introduced by the Department of Agriculture. The organizations also urge the Department of Justice and USDA to consider a full complement of policy tools needed to support competition in beef, for the benefit of consumers and producers. Between 1980 and 2020, the retail sector’s share of the beef dollar has grown by about 65 percent, while the packer’s share increased by more than 70 percent, according to OCM and AAI. Over the same period, ranchers’ share of the beef dollar dropped by about 40 percent. OCM Executive Director Mike Eby adds, “The strategic expansion of beef processing is a must.”
NFU Pleased Lawsuit Against the “Big 4” Packers Moving Forward
A federal judge in Minnesota this month ordered a class-action lawsuit against JBS, Tyson, National Beef, and Cargill to proceed. In the case, National Farmers Union is among the plaintiffs alleging that America’s four largest beef packers conspired to suppress the price of cattle and increase the price of beef. NFU President Rob Larew states, “We are pleased the effort to restore pricing transparency and competitiveness to the cattle markets is moving forward in the courtroom.” The case now enters the discovery phase of the trial, where evidence and information will be presented to demonstrate how packers violated the Sherman Antitrust Act, the Packers and Stockyards Act, and the Commodity Exchange Act. The case alleges malfeasance, which is intentional conduct that is wrongful or unlawful, and calls for pricing transparency and competitiveness in cattle markets. Larew claims the conduct of meatpackers “has been very damaging to independent farmers and ranchers.”
American Bumblebees Could be Listed as Endangered
The U.S. Fish and Wildlife Service this week announced the American bumblebee, whose populations have plummeted by nearly 90 percent, may warrant Endangered Species Act protection. The announcement kicks off a one-year status assessment of the species. A Federal Register document published Wednesday follows a petition filed by the Center for Biological Diversity and others. The Center says the species' decline has resulted from multiple concurrent threats, including habitat loss, pesticides, disease, climate change, and competition from non-native honeybees. The organization says Pesticide use, especially the widespread use of neonicotinoid insecticides, reduces survival and harms reproduction as well as bumblebee immune systems. American bumblebees were first described before the United States won its independence and are known by their distinctive black-and-yellow color pattern. The Fish and Wildlife Service will now initiate a scientific status review and public comment period before making a final decision on whether to protect the bumblebee.
AEM Offers Tips to Stay Safe on the Road During Harvest Season
The Association of Equipment Manufacturers has three tips to keep you safe on the road during harvest season. AEM’s Curt Blades says that all rural drivers should be aware, be predictable and be patient, this harvest season. And Blades adds that applies to everyone, saying, "we all need to recognize that everyone has to go down these same roads as safely as possible." A recent study from the University of Iowa Great Plains Center for Agricultural Health found that higher speed roads, and roads with limited visibility, such as narrow, hilly, or curvy roads, have a higher instance of traffic accidents between motor vehicles and farm equipment. Their study also found that 30 percent of these accidents occurred in urban zip-codes. Maximizing the safety of farmers in their equipment has also been a priority of the Association of Equipment Manufacturers, and that extends to keeping drivers on the road safe as well.
Thursday Watch List
Markets
USDA's weekly export sales report is set for 7:30 a.m. CDT, the same time as weekly U.S. jobless claims, a third estimate of U.S. GDP in the second quarter and the latest update of the U.S. Drought Monitor. Traders will be watching the Energy Department's report on natural gas storage at 9:30 a.m. At 11 a.m. CDT, USDA will release its quarterly Grain Stocks report and Small Grains Annual Summary.
Weather
A system slowly working through the Plains and into the western Midwest will bring some scattered showers on Thursday. This will cause some delays to the continued harvest and winter wheat planting. However, it will be highly beneficial for dry soils in the Central and Southern Plains and eliminate some areas of drought. Showers will be scattered though and some areas will be missed. Eastern crop areas should continue to see overall favorable weather conditions for harvest.
Wednesday, September 29, 2021
Lawmakers Urging Administration to Increase Biofuels Usage
AFBF, NPPC File Prop. 12 Appeal to Supreme Court
The National Pork Producers Council and the American Farm Bureau Federation this week petitioned the U.S. Supreme Court to take their case against California's Proposition 12. The California law would ban the sale of pork from hogs that don't meet the state's "arbitrary" production standards. The appeal to the high court comes after the U.S. Court of Appeals for the 9th Circuit in July upheld a lower court ruling against the NPPC-AFBF case. The appeals court found despite the organizations plausibly alleging that Prop. 12 "will have dramatic upstream effects and require pervasive changes to the pork industry nationwide," 9th Circuit precedent won't allow the case to continue. That precedent, however, runs counter to numerous Supreme Court decisions and conflicts with nearly every other federal circuit court. NPPC President Jen Sorenson states, “We're asking the Supreme Court to consider the constitutionality of one state imposing regulations that reach far outside its borders.”
Beyond Meat to Offer Chicken Imitator in Grocery Stores
Beyond Meat this week announced it is debuting its Beyond Chicken Tenders at select retailers nationwide. In addition to the retail rollout of the plant-based chicken tenders, Beyond Meat is also increasing its retail product distribution of other Beyond Meat products at Walmart stores in which Beyond Meat products are currently sold, making this the third such expansion this year alone. The company promotes the Beyond Chicken Tenders as a product that contains no GMOs, antibiotics, hormones or cholesterol. The protein in Beyond Chicken Tenders is derived from the faba bean, a nutrient-packed legume crop. Its unique qualities, the company says, make it the optimal ingredient for replicating the taste and texture of traditional chicken tenders. The retail rollout of Beyond Chicken Tenders follows the foodservice launch earlier this summer. Beyond Chicken Tenders come pre-cooked, ready-to-heat in the air fryer, oven or microwave. Starting in October, shoppers can find Beyond Chicken Tenders in select grocery stores.
Gallagher Ends Tenure as DMI CEO
Dairy checkoff program Dairy Management Inc. announced Tuesday that Tom Gallagher has decided to conclude his 30-year tenure as CEO to devote more time to teaching and other opportunities. Barbara O’Brien, President of DMI and CEO of the Innovation Center for U.S. Dairy, has been named by the board of directors as the next CEO. The board leadership, Gallagher and O'Brien will work on a transition plan, and Gallagher has committed his support through the transition timeframe. O'Brien's knowledge and experience with the dairy industry provide a seamless transition and a steady continuation of the checkoff's value to dairy farmers. In her current role, O'Brien has instilled a sales growth and outcomes-based mentality within her leadership team and staff, overseeing operating structures for business development, domestic and international sales, science and insights, marketing communications and finance. O'Brien adds, "I will set a vision that harnesses the strong legacy Tom built and leads to new long-term growth."
Tillable, Compeer Financial Launch Online Loan Applications
Tillable and Compeer Financial have partnered to launch an online loan application, enabling anyone to purchase or refinance farmland directly from a smartphone. Farmers, landowners and investors can now visit Tillable to shop for a farmland mortgage, refinance their current loans, or finance their cash rent. The all-digital lending application takes less than ten minutes to complete, and for the first time ever, qualified borrowers will learn if they are approved for the loan of their choice within seconds. The new service is currently available in selected counties in Illinois, Wisconsin and Minnesota. Compeer Financial will underwrite and service all loans originated through the partnership. In the near-term, the companies hope to digitize the entire closing process for farm loans. The new financial offering coincides with Tillable's entrance into the real estate brokerage market. Tillable customers can now buy or sell farmland through the website. For additional information on both services, visit Tillable.com.
2021 MILK Business Conference to Gather Dairy Industry Leaders in Las Vegas
The MILK Business Conference is set for November 30 – December 2, 2021, at the Paris Hotel in Las Vegas. The event will offer educational and networking opportunities for dairy industry leaders, live and in person, and will take place before the start of the National Finals Rodeo. Farm Journal calls the event the only one that focuses exclusively on every business aspect of dairy operations. The MILK Business Conference agenda highlights include Five Mega Trends in 2022 and Beyond, How to Become the Employer of Choice, Turning Manure into Money, a firsthand and expert session on mental health, a traceability session on beef on dairy and more. Farm Journal’s Cliff Becker says, “We’ll have speakers and sessions that will help dairy producers put their strengths to work.” Becker teases the event, adding, “A dairy’s greatest asset in 2035 might not be their cows. Register and attend to find out what it will be.” Find additional information and registration at MilkBusinessConference.com.
Wednesday Watch List
Markets
A report on U.S. pending home sales in August is due out at 9 a.m. CDT Wednesday, followed by the Energy Department's weekly energy inventories at 9:30 a.m., including ethanol production. Traders continue to monitor the latest weather forecasts and watch for any news of export sales. Investors will be keen to any news about a possible government shutdown.
Weather
A system emerging from the Rockies will produce scattered showers up and down the Plains on Wednesday while most other areas remain dry. Outside of the showers, temperatures will remain well above normal and areas that do not see any activity will have good harvest conditions for yet another day.
Tuesday, September 28, 2021
House Infrastructure Vote Likely This Week
It's a busy week in Washington, D.C., with a tight deadline for continuing resolutions and the U.S. debt ceiling, along with a planned infrastructure vote in the House of Representatives. House Speaker Nancy Pelosi had promised an infrastructure vote by Monday, but told House members late last week the debate would begin early in the week, with a likely vote on Thursday. The infrastructure package passed the Senate in August, which will help fund road, bridge, water infrastructure and other projects. Pelosi told Reuters over the weekend, “We are now working together with the Senate and the White House on changes to this historic legislation.” Pelosi said she would not bring the infrastructure bill to a vote until she was sure it would pass, but expressed confidence about its prospects. Some House Democrats have threatened to vote against the bill, instead favoring the larger $3.5 trillion version of the bill.
USDA Investing $75 million in Projects with Focus on Climate-Smart Ag
The Department of Agriculture will invest nearly $75 million for 15 partner-led projects to address natural resource concerns on private lands. This year, projects funded by the Regional Conservation Partnership Program's Alternative Funding Arrangements focus on climate-smart agriculture and forestry and other conservation priorities and improve access for historically underserved producers. As part of this year's project selections, NRCS prioritized projects that supported smart strategies on working lands to help sequester carbon, reduce greenhouse gas emissions and mitigate the impacts of climate change. Several projects also had concrete plans for engaging producers from historically underserved communities. Announced Friday, the funded projects include the Climate Action and Reforestation in Northern Michigan, Enhancing Hawaii's Forests for Climate Resilience and South Dakota’s Expanding Soil Health Through Carbon Markets, among others. First authorized in the 2014 Farm Bill, the Regional Conservation Partnership Program has leveraged partner contributions of more than $1 for every $1 invested by USDA.
U.S. Hog, Cattle on Feed Inventories Decline
USDA last Friday released the monthly Cattle on Feed report and the Quarterly Hogs and Pigs report. United States inventory of all hogs and pigs on September 1, 2021, was 75.4 million head, down four percent from 2020, but up one percent from June 2021. Breeding inventory, at 6.19 million head, was down two percent from last year, and down slightly from the previous quarter. Market hog inventory, at 69.2 million head, was down four percent from last year, but up one percent from last quarter. Meanwhile, the monthly Cattle on Feed report shows cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.2 million head on September 1, 2021. The inventory was one percent below September 1, 2020. This is the second-highest September 1 inventory since the series began in 1996. Placements in feedlots during August totaled 2.10 million head, two percent above 2020.
Grassley Running for Another Senate Term
Long-time Iowa Senator Chuck Grassy, at 88 years old, will seek reelection in 2022. Grassley is the oldest Republican in the Senate, and if elected, his next term will end when he is 95. In announcing his decision, Grassley says, “Iowans have encouraged me to continue my work representing them.” Democrat Abby Finkenauer, a former U.S. Representative from Iowa, is in the race against Grassley. Finkenauer stated via Twitter that Grassley "spent 47 years with the DC elite, lining his own pockets," and is "just another DC politician who can’t let go of power and turned his back on families like mine.” Grassley’s campaign contends he has consistently been recognized as one of the most bipartisan and effective senators, according to independent analysis conducted by GovTrack and the Lugar Center at Georgetown University. Grassley currently serves as the Senate Finance Committee Chair, and holds a seat on the Senate Agriculture Committee.
Restaurants Feeling Equipment Supply Chain Issues
U.S. restaurants feeling supply chain issues for their food products are also contending with issues around upgrading kitchen equipment. Restaurant Business reports it can sometimes take months to get equipment in the door, thanks to a backlog of imports that has left two dozen or more container ships waiting outside of U.S. ports. Mark Rossi, CEO of Avanti Restaurant Solutions, told Restaurant Business that the supply chain challenges could be expected to persist until at least January 2023, or longer. The supply chain issues caused by the COVID-19 pandemic stems from labor issues, including a lack of truck drivers and manufacturer's struggling to bring workers back. The lack of truck drivers creates backlogs of shipments at U.S. ports, as container ships are forced to wait longer to unload. The challenge for restaurant operators comes as they’re dealing with their own issues, including a labor shortage and trouble getting food supplies in the door.
Weekly Fuel Prices Mixed
The nation's average gas price declined 0.7 cents per gallon from a week ago to $3.17 per gallon, according to GasBuddy. The national average is up 3.8 cents from a month ago and $1.00 per gallon higher than a year ago. The national average price of diesel has risen 1.4 cents in the last week and stands at $3.31 per gallon. Relief in average prices has mostly shown up west of the Rockies thus far and may continue to be delayed by an active hurricane season. GasBuddy’s Patrick De Haan states, “While I am optimistic that we eventually will see a decline in price, the drop is not likely to be as noticeable as I had anticipated due to the above average hurricane season and as demand remains seasonally strong.” Crude oil prices are increasing on renewed concerns that oil supply is not keeping up with demand as the global economy continues to improve as the pandemic eases.
Tuesday Watch List
Markets
There is a report on U.S. consumer confidence for September due out at 9 a.m. CDT. U.S. Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell will testify before the U.S. Senate Banking Committee Tuesday. Traders will continue to keep up with the latest weather forecasts and watch for any news of an export sale.
Weather
Another day of well above normal temperatures and mostly dry conditions across the major growing areas of the country will provide good weather for harvest. Some isolated showers in Texas and the Pacific Northwest will be the only significant radar signatures today with showers starting to move into the Plains tonight.
Monday, September 27, 2021
Reconciliation Bill Tackles Conservation and Farm Assistance
The Hagstrom Report says the Democrats’ budget reconciliation bill will contain language to address the court cases brought against a program to provide debt relief directed to minority farmers. Senate Ag Chair Debbie Stabenow made that known after a committee business meeting last week. White farmers and many conservation groups have filed 13 lawsuits against the program, but the Biden administration hasn’t yet responded. Stabenow says, “We’re leading the way in helping farmers tackle the climate crisis with a historic investment of $28 billion, which is the largest investment in conservation since the Dust Bowl.” She also points out that American conservation programs are proven and popular with farmers, ranchers, and foresters. This will make a huge impact on reducing greenhouse gas emissions and is equal to taking about 142 million cars off the road. The legislation would provide $5 billion for direct payments to producers who establish cover crops totaling $25 per acre for up to 1,000 acres through the fiscal year 2026.
Hurricane Ida Does More than $500 Million to Louisiana Agriculture
Hurricane Ida did more than a half-billion dollars’ worth of damage to Louisiana agriculture. The LSU AgCenter says the Category 4 hurricane’s total damage to Louisiana’s agriculture industry is at least $584 million. Economist Kurt Guidry tells The Hill that about half the damage is to the timber industry, the top-grossing ag commodity in the Bayou State. Over 168,000 acres of timberland were affected by the hurricane’s winds, which caused an estimated $300 million in damage. The AgCenter report says along with the timber, 35 percent of the damage is estimated to be in infrastructure losses such as equipment. Other commodities like sugarcane, horticulture, and livestock were also affected by Ida. Sugarcane took a 35 million dollar hit, while horticulture also saw approximately $9.5 million in damages. Livestock losses are currently low, with only 22 recorded livestock deaths so far. The overall dollar amount in damage also includes estimates for future costs affecting production and reduced crop yields brought on by the storm.
USDA Will Establish an Equity Commission
The USDA says it will establish an Equity Commission and is looking for nominations for membership on the Commission’s Advisory Committee and Subcommittee on Agriculture. “USDA is committed to advancing equity throughout the Department,” says Ag Secretary Tom Vilsack. The Equity Commission will advise the Ag Secretary by identifying USDA programs, policies, systems, structures, and practices that contribute to barriers to inclusion or access, systemic discrimination, or exacerbate racial, economic, health, and social disparities. The Ag Subcommittee will report back to the Equity Commission and provide recommendations on issues of concern that relate to agriculture. Additional subcommittees will focus on other policy areas, such as rural communities and economic development. The Equity Commission will deliver an interim report and provide actionable recommendations within a year of its formation. House Ag Chair David Scott says, “Today’s announcement will remedy inequalities in any program, policy, system, structure, or practices at USDA, and that’s a step in the right direction.” The Georgia Democrat says he’s thankful for the Ag Secretary’s efforts to address any wrongdoing at USDA.
NAFB Taking Applications for 2021 Social Media Corps
The National Association of Farm Broadcasting is accepting applications from agricultural communications students for the 2021 NAFB Convention Social Media Corps. Students will cover the sessions, events, news, and awards at the 78th Annual NAFB Convention. The social media corps will fully participate in the convention scheduled for November 17-19 in Kansas City, Missouri. The group will take to NAFB’s digital platforms to share stories from the convention and the Trade Talk floor. Communicators will collect content, including photos, videos, and blog posts, and the Corps will guide the online conversation throughout the event. NAFB is looking for students planning to attend the convention, are passionate about social media and digital storytelling, and looking to learn, share, and grow in the social media space. Selected participants are responsible for their travel to and from the convention. NAFB will provide housing and convention registration. Participants are chosen through a competitive application process, with applications due by 5 p.m. central time on Friday, October 29. The three interns will be announced on November 3.
First-Ever Shipment of U.S. DDGS Arrives in Tunisia
A combination of competitive freight prices and market-specific educational efforts from the U.S. Grains Council has led to the first-ever shipment of dried distiller’s grains with solubles arriving in Tunisia (too-KNEE-zhah). The shipment was delivered earlier this month and marked the opening of new opportunities for American growers and shippers to get products into the Mediterranean region. The USGC’s Middle East and Africa Office says the council’s strategy is focusing on marketing the U.S. advantage in Tunisia for corn and corn co-product imports. The feed industry in Tunisia is a mature market compared to other neighboring countries, and the Council’s efforts have focused on trade servicing and promoting these products. Bulk carrier rates on several key routes in the region are higher than previous record levels, which means some importers are looking at other options. This has boosted container rates in the U.S., with feed grain importers near the Mediterranean Sea and Arab Gulf opting to use containers rather than bulk shipments to reduce feed costs. The USGC’s regional office is actively supporting the country’s protein demand growth through promoting U.S. corn and its co-products, organizing events, and hosting industry stakeholders in the United States.
CoBank: Ag Retailing Future Driven by Precision
A new report from CoBank’s Knowledge Exchange says the ag retailer of the future has an opportunity to earn more income from precision agronomy services and emerging sustainability management programs. Traditional crop input sales will continue to be a boon for retailers in the future. The report says the current strong financial returns that cooperatives and independent ag retailers are enjoying provide a timely opportunity to invest in new technologies. The goal would be to position themselves for success in a rapidly evolving marketplace. “The traditional approach for farm supply cooperatives is to save above-average profits when times are good and then manage costs during a downturn,” says Kenneth Zuckerberg, lead grain and farm supply economist for CoBank. “Unfortunately, this approach exposes cooperatives to revenue volatility and declining earnings during down cycles, which can often last five or more years.” Instead of relying on product commissions and rebates alone, Zuckerberg says farm supply cooperatives’ path forward is to expand their precision agronomy service offerings and capture more income from consultative service and software fees. “Putting technology and information to work to help farmers manage their inputs and production is where farm supply co-ops excel,” he says.
Monday Watch List
Markets
Back from the weekend, traders will check the latest weather forecasts and watch for any new developments out of China. A report on U.S. durable goods orders for August is due out at 7:30 a.m. CDT, followed by a possible export sale announcement at 8 a.m. USDA's weekly report of grain export inspections will give a clue as to how river traffic is moving through Louisiana. USDA's Crop Progress report at 3 p.m. will report on row crop harvest progress and winter wheat planting.
Weather
A ridge of high pressure will keep most of the country hot and dry. This should promote harvest activities especially considering the rain in the forecast later this week. The Pacific Northwest should see some beneficial showers, but more are needed for winter wheat. Winter wheat in the Southern Plains will have difficulty under heat and moisture stress through Tuesday before beneficial showers return.
Friday, September 24, 2021
USDA Takes Steps to Build More Sustainable, Resilient and Inclusive Food Systems
The Department of Agriculture highlighted investments to end hunger and malnutrition at the United Nations Food Systems Summit this week. Speaking of the total $10 billion of investments, Agriculture Secretary Tom Vilsack states, “We must use the power of ingenuity to improve on food systems so they provide safe, nutritious, affordable and accessible food for all." USDA also announced the formation of the Coalition of Action on Sustainable Productivity Growth for Food Security and Resource Conservation. This global, multi-sector coalition will accelerate the transition to more sustainable food systems through agricultural productivity growth. To help ensure that every child has access to nutritious school meals by 2030, USDA is leading U.S. participation in the coalition on School Meals, which supports comprehensive and effective school feeding programs worldwide. The United States, led by USDA, is also supporting the global Food is Never Waste Coalition, and reaffirming its commitment to reducing food loss and waste domestically.
Industry Responds to Coalition Announced at UN Summit
Agriculture and food industry groups welcome the formation of the Coalition of Action on Sustainable Productivity Growth for Food Security and Resource Conservation. The North American Meat Institute announced that it will join the effort. The Meat Institute expects to announce in November ambitious, data-driven targets to publicly verify progress on the 100 metrics in its sustainability framework. NAMI President and CEO Julie Anna Potts commented, "our commitments to economic, social, and environmental sustainability place us at the center of solutions for a healthy future." The National Milk Producers Federation, in a statement, commented, "We're ready to do the work needed to advance the pragmatic, forward-looking approach the U.S. has charted throughout the summit's process." American Feed Industry Association President and CEO Constance Cullman commended U.S. leaders at the summit, saying, “They signaled to the world that the U.S. does not intend to turn the clock back on scientific progress, but instead, advocate for modern technologies and practices.”
Senate Ag Advances USDA Natural Resources and Environment Nominee
The Senate Agriculture Committee Thursday advanced the nomination of Dr. Homer L. Wilkes to be USDA’s undersecretary for Natural Resources and Environment. Wilkes currently serves as Director of the Gulf of Mexico Ecosystem Restoration Team. He served as acting associate chief of the Natural Resources Conservation Service between 2010 and 2012 and has over 40 years of public service experience. Committee Chair Debbie Stabenow, a Democrat from Michigan, states, "Wilkes is a dedicated public servant and strong bipartisan choice to lead USDA's efforts to restore and protect the health of our public forests and grasslands." Stabenow also noted The Natural Resources and Environment mission area is at the forefront of tackling the climate crisis. Ranking Member John Boozman, an Arkansas Republican, adds, “Wilkes will bring the same qualities and characteristics demonstrated during his long tenure at NRCS to his role as undersecretary, which is exactly what is needed in that role.”
ERS: Interest in Antibiotic-free Chicken Increasing
The Department of Agriculture's Economic Research Service this week released a report titled "The Market for Chicken Raised Without Antibiotics, 2012–17." The report studies consumer attitudes for chicken raised without antibiotics and their purchases of the products. The analysis grouped chicken products into three distinct market segments: classic, processed, and sausage. Between 2012 and 2017, household expenditure shares for antibiotic-free products grew substantially within each of the three market segments. In 2012, the products only represented four percent of the classic market, one percent of the processed market, and seven percent of the sausage market. By 2017, the products represented 11, nine, and 18 percent of the markets, respectively. Between 2012 and 2017, antibiotic-free products also commanded higher prices per pound than conventional chicken products. For classic, processed, and sausage chicken products, antibiotic-free products had prices that were on average 87, 55, and 48 percent greater than conventional products.
NFU Announces Campaign to Fight Monopolies in Agriculture
National Farmers Union this week announced the Fairness for Farmers campaign as members gathered for a virtual fly-in. The effort seeks to rally Americans to urge lawmakers and the Biden administration to take concrete steps to curtail consolidation in agriculture, which NFU says negatively impacts farmers, ranchers and consumers. NFU President Rob Larew states, “We launched Fairness for Farmers because we have a President who is committed to taking on the challenge of fighting consolidation in agriculture.” The campaign seeks to encourage farmers and ranchers to share their stories online, engage with media, and build support for lawmakers and regulators to strengthen pro-competition laws and regulations. Through the campaign, NFU is calling for Packers and Stockyard Act reform, improved price discovery in beef markets, and reinvigorated antitrust enforcement. Larew added, “I do believe we are in for a fight,” but continues, NFU members are “not afraid of a fight and are ready to stand up for fairness.”
NASDA Elects New York’s Richard Ball as President
The National Association of State Departments of Agriculture elected New York Agriculture Commissioner Richard Ball as President this week. Ball will serve as NASDA's 2021-2022 President and will host the 2022 NASDA Annual Meeting. The election was part of the conclusion of the organization’s annual meeting this week in Kentucky. Commissioner Ball states, “I am honored to be elected NASDA's new president and to lead as our states work together to ensure that agriculture continues to grow and thrive.” Also elected to NASDA's Board of Directors were Wyoming Director of Agriculture Doug Miyamoto as Vice President, Indiana Director of Agriculture Bruce Kettler as Second Vice President, and Arkansas Secretary of Agriculture Wes Ward as Secretary-Treasurer. Kentucky Commissioner of Agriculture Ryan Quarles will serve as NASDA's Past President, and Oklahoma Secretary of Agriculture Blayne Arthur will serve in the At-Large position. District board members include Pennsylvania’s Russell Redding, West Virginia’s Kent Leonhardt, Illinois’ Jerry Costello, and Washington’s Derek Sandinson.
Friday Watch List
Markets
As usual, traders will be checking the latest weather forecasts and watching for a possible export sale announcement at 8 a.m. CDT. A report on U.S. new homes sales in August is due out at 9 a.m. At 2 p.m. CDT, USDA releases a quarterly Hogs and Pigs report and a monthly Cattle On-Feed report.
Weather
A cold front will bring some isolated showers to northern areas of the country Friday with mild and dry conditions across the rest of the country's growing regions. Despite the showers, harvest conditions should still be good for most of the country, though the eastern Midwest may need several days to dry out from this week's heavy rainfall
Thursday, September 23, 2021
Report: EPA Proposing Cuts to Biofuel Blending Requirements
A new report from Reuters claims the Environmental Protection Agency will propose cuts to blending requirements under the Renewable Fuel Standard. A document seen by Reuters reporters contained proposed cuts that would reduce blending mandates for 2020 to about 17.1 billion gallons and 18.6 billion gallons for 2021. Those levels are significantly lower than the 20.1 billion gallons finalized for 2020 before the pandemic. EPA is setting the 2020 and 2021 mandates retroactively and would set 2022 at about 20.8 billion gallons. Reuters suspects ethanol would take the biggest hit, dropping from 15 billion gallons to about 12.5 billion gallons in 2020, 13.5 billion in 2021, and 14.1 in 2022. However, the proposals, sent to the White House Office of Management and Budget last month, are not final. Republican Senator Chuck Grassley of Iowa told reporters Tuesday he expects EPA to release the proposal at the end of this week, possibly late Friday.
USDA Statement on ASF in Haiti
The Department of Agriculture’s Animal and Plant Health Inspection Service calls the discovery of African swine fever in Haiti unfortunate, but not unexpected. Monday, a case of ASF was reported to the World Organization for Animal Health after confirmed by USDA's Plum Island, New York, facility. The sample was collected from a pig in a province bordering the Dominican Republic, where ASF was discovered this summer. In a statement, APHIS said it has numerous interlocking safeguards in place to prevent ASF from entering the United States. Pork and pork products from Haiti and the Dominican Republic are prohibited entry to the United States because of existing classical swine fever restrictions. After ASF was detected in the Dominican Republic, APHIS increased surveillance and safeguards in U.S. territories. APHIS continues to work with partners, including the U.S. Customs and Border Protection and the U.S. swine industry, to prevent ASF from entering the United States.
USDA to Host Virtual Data Users’ Meeting
The Department of Agriculture’s National Agricultural Statistics Service will hold its biannual Data Users’ Meeting virtually next month. The Data Users’ Meeting is held to share recent and pending statistical program changes with the public and to solicit input on the programs. The event is organized by NASS in cooperation with the World Agricultural Outlook Board, Farm Service Agency, Economic Research Service, Agricultural Marketing Service, Foreign Agricultural Service and U.S. Census Bureau. Agricultural Statistics Board Chair Joe Parsons states, “This is an excellent opportunity for data users to be informed and involved in guiding the agricultural information USDA produces, both now and into the future.” The October 13 agenda includes agency updates followed by breakout sessions for participants to choose from one or more in-depth topics. On October 14, the floor will open to participants for questions and comments, and the event will close with additional breakout sessions. You can register online.
USSEC Announces Global Aquaculture Industry Advisory Council
The U.S. Soybean Export Council Wednesday announced the convening of the Global Aquaculture Industry Advisory Council. The council includes fresh multistakeholder representation from 11 academia, civil society, industry, public sector, and sustainability certification organizations around the world. USSEC says the council reaffirms U.S. Soy farmers and the industry's commitment to shaping a growing and sustainable aquaculture industry. Approximately 3.3 billion people rely on seafood for almost 20 percent of their average per capita intake of protein, making it the world's largest traded food commodity. The amount of seafood produced by aquaculture now exceeds wild catch. Total fish production is expected to expand from 179 million metric tons in 2018 to 204 million metric tons in 2030. Aquaculture consumption increased 122 percent from 1990 to 2018, and production is projected to reach 109 million tons in 2030. The USSEC Global Aquaculture Industry Advisory Council will meet at least twice a year, with the first meeting September 2021 virtually.
DeLauro introduces Fresh Produce Procurement Reform Act
House Appropriations Committee Chair Rosa DeLauro this week introduced the Fresh Produce Procurement Reform Act. The Connecticut Democrat says the legislation will increase and improve the Department of Agriculture’s procurement of fresh fruits and vegetables. The bill would require USDA to partner with growers, distributors, and food hubs to provide fresh, U.S.-grown fruits and vegetables to community organizations like schools, food pantries, and youth organizations while prioritizing socially disadvantaged farmers and entities and regional food inequities. The United Fresh Produce Association welcomed the legislation. United Fresh President and CEO Tom Stenzel states, “This is a monumental step in the right direction in addressing nutrition insecurity and access for the nine out of ten Americans who struggle to meet Dietary Guidelines’ fruit and vegetable recommendations.” Late last year, United Fresh convened a working group to embark on a months-long project of providing recommendations on how to reform purchasing practices to be more inclusive of fresh produce.
Bayer to Launch Organic Vegetable Seeds Portfolio
Bayer this week announced it will expand its vegetable seeds offerings under the Bayer umbrella to include organically produced seed. The launch will focus on certified organic production in three key crops for the greenhouse and glasshouse market, including tomato, sweet pepper and cucumber. These will be followed by tomato rootstock varieties in 2023. Bayer's expanded portfolio is in direct response to increased customer need for high-quality organic seed. Global consumer demand for certified-organic products continues to grow and is predicted to drive market expansion. The global organic food seeds market was valued at 355 million in 2020 and is expected to grow to $480 million by 2025. The commercial launch for the new certified organic portfolio is planned for early 2022 and will focus on the high-growth organic markets of Canada, United States, Mexico, Spain and Italy with potential for future expansion based on market demand. Learn more at vegetables.bayer.com.
Thursday Watch List
Markets
USDA's weekly export sales report is due out at 7:30 a.m. CDT Thursday, along with weekly U.S. jobless claims and an update of the U.S. Drought Monitor. The index of U.S. leading indicators for August is set for 9 a.m., followed by the Department of Energy's natural gas storage report at 9:30 a.m. Natural gas has more attention these days, now that U.S. supplies are down from a year ago, heading into winter.
Weather
As a system continues to wrap up over the Great Lakes, isolated showers will continue around Michigan, but with some streaks of moderate rain. Dry and mild conditions are in place for the rest of the country's growing regions, benefiting harvest and allowing soils to drain that saw moderate to heavy rainfall this week
Wednesday, September 22, 2021
African Swine Fever Confirmed in Haiti
The World Organization for Animal Health this week confirmed finding African swine fever in Haiti. Haiti borders the Dominican Republic, which confirmed the virus was in-country this summer. The farm in Haiti with confirmed African swine fever is near the border. Haiti is conducting surveillance for the disease in pigs and imposed a quarantine to control the outbreak, according to Reuters. The U.S. Department of Agriculture found the disease last week through testing at the Foreign Animal Disease Diagnostic Laboratory on Plum Island, New York. USDA confirmed ASF in the Dominican Republic in July and issued a warning that Haiti was at high risk for infections. Meanwhile, last week, USDA issued a Federal Order suspending interstate movement of all live swine and swine products from Puerto Rico and the U.S. Virgin Islands to the mainland United States. African swine fever poses no health risks to humans but is deadly in pigs.
USDA, HHS Launch Resource Guide to Increase Rural Access to Child Care
The Department of Agriculture and the Health and Human Services Department Tuesday unveiled a joint resource guide to help people in rural and Tribal communities increase access to childcare services. The guide was developed in partnership by USDA Rural Development and the Office of Early Childhood Development in HHS’ Administration for Children and Families. It provides useful information to help stakeholders in rural communities, including Tribes and Tribal organizations, address the need for improved access to affordable, high-quality childcare and early learning facilities through USDA and HHS funding and technical assistance resources. USDA Rural Development undersecretary Justin Maxson states that access to quality and affordable healthcare “enables parents to work, strengthens the economy and supports children’s overall development by laying the groundwork for future success in school and life.” The joint resource guide follows the Biden-Harris Administration’s announcement of the American Families, targeting investments to support America's children and families.
Growth Energy Urges President Biden to Uphold Clean Energy Commitments
Growth Energy members call on President Joe Biden to stand behind his promise to take clear action on climate change by supporting low-carbon biofuels and upholding the Renewable Fuel Standard. During a virtual fly-in this week, 87 Growth Energy members sent a letter to President Biden outlining their take on the issue. The letter states, “If we are to achieve net-zero by 2050, we must use all tools in the toolbox – including biofuels.” The Growth Energy members point out that fuels like ethanol reduce carbon emissions by 46 percent over their full lifecycle. As for the Renewable Fuel Standard, the group says fossil fuel advocates continue to demand that EPA adopt Renewable Volume Obligations that fall far short of the President’s commitment to uphold the RFS. To help reduce carbon emissions and reach Biden's transportation decarbonization goals, the letter adds, "it is vital that conventional biofuel blending targets meet the15-billion-gallon minimum required by law."
Study Shows Ag Retailers Thoughts on Carbon Markets
A new survey by Axiom Marketing shows the participation levels and interest in Carbon Markets from ag retailers, a top source of information for farmers. The research from the Minneapolis-based firm found that 70 percent of retailers do not understand how to verify carbon to participate in the carbon markets. Of the retailers surveyed, 50 percent say they are unsure if they will participate, with only eight percent saying the current incentive levels are enough to gain grower interest. The majority of retailers surveyed manage their grower's digital data and promote sustainable activities. This fact should make them an ideal conduit to help growers monetize carbon credits, according to Axiom. However, only 29 percent are actively participating and monetizing carbon. Axiom's survey also found that carbon credits may need to be higher to gain greater appeal. Sixty-five percent of respondents said they think farmers will require more than $10 per acre.
USTR Tai Meets with United Kingdom on Trade
United States Trade Representative Katherine Tai this week met virtually with United Kingdom Secretary of State for International Trade Anne-Marie Trevelyan (tre-vely-an). Ambassador Tai emphasized her commitment to deepening bilateral trade and investment ties between the U.S. and the United Kingdom. The USTR office says Tai discussed USTR’s ongoing review of the U.S. – U.K. free trade agreement negotiations to evaluate how a potential agreement could support the Biden-Harris Administration’s broader Build Back Better agenda. Ambassador Tai and Trevelyan discussed the upcoming G7 trade ministerial. Back in March, the Biden Administration suspended some tariffs on goods from the United Kingdom. No longer a member of the European Union, the United Kingdom said in December that it will suspend tariffs on the U.S. tied to the World Trade Organization ruling against Boeing Airline subsidies. It was a move that trade experts say was a sign that the British government is hoping to resume negotiations with the United States.
Positive Outlook for Real Christmas Trees in 2021
Christmas tree growers are overcoming logistical challenges of COVID-19 and a heatwave in the Pacific Northwest to provide enough trees for 2021 demand. After close evaluation and making tree-by-tree decisions, growers expect to supply the same overall number of real Christmas trees to the marketplace this season as they had planned before the crises hit. With just about eight weeks to go until the real Christmas tree shopping season hits, industry experts are confident there will be a real Christmas tree for everyone who wants one this year. Oregon-based Christmas tree producer Bob Schaefer says, “We didn't run out of trees last year. Or in 2019. Or the year before that. In fact, we never have, and we don't intend to this year." With the artificial market hit hard by supply-chain disruption this year, and the real Christmas tree market returned to optimism, it's an especially relevant season for newcomers to natural trees.
Wednesday Watch List
Markets
A report on U.S. existing home sales for August is due out at 9 a.m. CDT Wednesday, followed by the Energy Department's weekly report of energy inventories at 9:30 a.m. The Federal Reserve's two-day meeting concludes at 1 p.m. with an announcement of any agreed policy changes. USDA's monthly cold storage report is set for 2 p.m. CDT.
Weather
A front will continue to bring moderate to locally heavy rain across the eastern growing areas Wednesday and there could be some flooding, which would cause some quality issues and delays for harvest. Much better conditions have developed west of this system for harvest, but more rain is needed for winter wheat in the Plains and Pacific Northwest.
Tuesday, September 21, 2021
“No” to Immigration Reform – Ag Labor in Limbo?
Senate Parliamentarian Elizabeth MacDonough ruled against the Democrats’ plan to provide eight million green cards as a part of their $3.5 trillion spending bill. The Hill says that decision makes getting immigration reform to President Biden’s desk that much harder. MacDonough’s guidance all but closes the door on Democrats’ chances to be able to use the spending bill as a potential pathway to citizenship for millions of immigrants. Democrats had wanted to provide those green cards for four groups of immigrants, including “Dreamers,” temporary protected status holders, agricultural workers, and essential workers. Getting legal permanent status allows people to eventually apply for permanent citizenship if they can meet other qualifications. Because Democrats are using reconciliation to pass a spending bill without GOP support, there are strict requirements regarding what can and can’t be included in the legislation. Democrats initially said they would keep trying to sway the Senate’s “referee” until the $3.5 trillion spending bill was on the Senate floor. Over the weekend, Senate Majority Leader Charles Schumer said his party would take an alternative proposal to MacDonough. Republicans argued before MacDonough that immigration reform was outside the scope of what could get passed under reconciliation.
BLM Headquarters Returning to Washington, D.C.
Interior Secretary Deb Haaland says the leadership of the Bureau of Land Management will be moving back to Washington, D.C., from Grand Junction, Colorado. The Hagstrom Report says the Trump Administration had previously moved the office out west. “The bureau must have the appropriate structure and resources to serve the American public,” she says. The National Cattlemen’s Beef Association and the Public Lands Council condemned the decision. Kaitlynn Glover, NCBA Executive Director of Natural Resources and the Executive Director of the PLC says that more than 5.5 million acres have burned in catastrophic wildfires this year. “From Arizona to Minnesota, 14 states are going through an extreme drought that’s thrown rural communities into crisis,” she says. “In a normal season, this would be a disappointing decision, but in the middle of immense threats to public lands, ecosystems, wildlife, businesses, and residents, this is dangerously irresponsible.” Glover also says BLM’s operations did suffer as a result of their move, but “playing political football” with their mailing address is something western communities can’t afford. “Implementing another move now is a bad idea when the BLM staff’s time and attention are needed more than ever,” Glover says.
Taiwan Threatens to Take China Before the WTO
Over the weekend, Taiwan threatened to take China before the World Trade Organization after Beijing suspended sugar apple and wax apple imports from the island nation due to pest concerns. Reuters says it’s the latest flare-up between the two countries over fruit. China’s customs administration has said more than once that it’s detected pests in the sugar apples and wax apples. The administration asked all of its offices to begin stopping customs clearance for those items starting on Monday. Taiwan’s Council of Agriculture Minister says China made the decision “unilaterally” without providing any scientific evidence to support the move. Taiwan told China it will take the country through the WTO’s dispute resolution mechanism if Beijing doesn’t respond to Taiwan’s request to settle the issue under the existing bilateral agreement between the two before September 30. Taiwan’s Foreign Minister Joseph Wu took it a step further on Twitter, noting that China was now “weaponizing trade” and the move should cast doubt over its recent application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership free trade group. Relations between the Taiwan and China are at their lowest point in years.
Federal Order Issued for ASF Protection Zone
The USDA’s Animal and Plant Health Inspection Service is issuing a federal order suspending the movement of all pork and pork products from the Virgin Islands and Puerto Rico into the U.S. Shipments of live swine, swine germplasm, swine products, and swine byproducts are halted until APHIS can establish sufficient mitigations to authorize such movement. The federal order is the final action in a series of safeguards needed to establish an African Swine Fever protection zone in Puerto Rico and the U.S. Virgin Islands. When the zone is established, APHIS will have processes in place in both countries to prohibit the movement of live swine and products out of the protection zone, conduct appropriate surveillance within the protection zone to quickly detect any introduction of the disease, and conduct a public education campaign relating to biosecurity on farms and other establishments. APHIS will soon detail the actions taken to create the protection zone in a report to the World Organization for Animal Health. Once the report is submitted, APHIS will work to confirm that individual countries recognize and accept the zones, which will help ensure the continued flow of U.S. pork and live swine exports.
Nominations Open for the Rural Spirit Awards
Osborn Barr Paramore is accepting nominations for the fourth annual Rural Spirit Awards. The awards are given out to recognize unsung heroes of rural America who “instill hope, solve problems, and commit to stepping up to meet the needs of their communities” as the country faces ongoing challenges related to COVID-19. OBP is looking to celebrate people who support and improve rural America through community service and economic development. Three award winners will be named in three categories. The Community Service Award honors an individual who exhibits the rural spirit through exceptional service in the name of community growth. The Next Gen Award Recognizes an individual 21 and under. Any potential Next Gen Award winner demonstrates uncommon leadership through community service efforts or innovative thinking. The Rural Advocacy Award celebrates a person who proudly embodies the heart of rural America, working hard to spur economic development, creating jobs, or advocating for growth. The public can go to www.RuralSpiritAwards.com and nominate deserving individuals. The nomination period closes October 11 at 11:59 p.m., CDT. Winners each receive $2,000 to donate to a nonprofit organization of their choice, with donations made in the winner’s name. Winners will be announced and recognized at an awards celebration on Thursday, October 21.
NCGA Looking for Research Projects on Aflatoxin
That National Corn Growers Association announced a new round of research grants to help farmers manage aflatoxin issues. The Aflatoxin Mitigation Center of Excellence (AMCOE) is accepting letters of intent from principal investigators, co-principal investigators, and collaborators. There’s a limit of $75,000 per year and applications will be accepted through October 15. AMCOE’s Research Program will offer grants for projects focused on solving profit-robbing aflatoxin issues for farmers. The grants will be awarded to researchers focusing on one of six priority areas. “Through the efforts of AMCOE, substantial progress has been made in understanding and managing aflatoxin and other mycotoxins,” says Charles Ring, a Texas corn grower and AMCOE Committee Chair. “NCGA administers AMCOE to create a united approach to aflatoxin research, with the primary goal to deliver advanced strategies, tools, and results to growers.” While corn farmers in Southern states experience aflatoxin challenges annually, these challenges may present themselves in any corn region of the U.S. when the crop comes under stress. NCGA points out that the benefits of this research are national in scope. For more information about AMCOE, go to ncga.com.
Tuesday Watch List
Markets
A report on U.S. housing starts is due out at 7:30 a.m. CDT Tuesday and is the only significant report of the day. Traders will be influenced by Monday afternoon's Crop Progress report and the latest weather forecasts. Soybean export sales have been active lately and traders will watch for a possible announcement from USDA at 8 a.m.
Weather
A front combined with moisture from the Gulf of Mexico will lead to wet conditions from the Great Lakes down to the Gulf of Mexico while drier conditions build in behind the front through the Plains. Rain could be heavy in spots, leading to quality issues and delays for maturation and harvest while conditions improve to the west.
Monday, September 20, 2021
House Democrats Ask Leadership for Extra Funds to Prevent ASF
A group of House Democrats sent a letter to leadership asking for $75 million in funding for the Animal and Plant Health Inspection Service to help prevent and prepare for a possible African Swine Fever Outbreak in the U.S. A total of seven House Democrats are concerned about an ASF outbreak in America’s swine herds. They’re asking House Leadership to include the requested funds in the next continuing resolution or supplemental appropriations package that moves through Congress. “A confirmed ASF positive sample in any U.S. state or territory would be devastating to the American pork industry and rural economy,” they wrote in the letter. “An outbreak in any part of the U.S. would restrict pork producers from being able to participate in global trade.” The representatives also point out that America’s pork producers are a crucial part of the domestic food supply chain and contribute close to seven billion dollars in global exports, which makes the additional investment in APHIS vital to the safety of America’s food supply. In July, APHIS confirmed the presence of ASF in samples collected from hogs in the Dominican Republic, raising concerns about a possible outbreak that could reach the United States.
Barge Shipping Costs Spiking After Hurricane Ida
Barge freight costs for moving grains from the Midwest rose sharply due to the continuing logistical problems over two weeks after Hurricane Ida hit the Delta Region. As grain handlers are scrambling to get operations going again at the Gulf of Mexico, China booked four to six bulk cargoes of soybeans from Brazil for shipping in October and November, which is the peak of the U.S. export period. That agreement between China and Brazil is fueling industry concerns that terminal capacity at the Gulf will be limited into the next month. Cash grain traders tell Reuters that Gulf shipping problems are causing the cost for barge freight to rise along Midwest rivers. Unloading barges arriving at the Gulf is being delayed, which is creating a shortage of empty barges needed upriver as corn and soybean harvest revs up in the Midwest. Adding to the sense of urgency is the fact that crops are maturing faster than normal in key states like Minnesota, Iowa, and Illinois. Southern states are also much farther along in their harvest than northern states. “You have these southern states, and you need to get all of that through the system before the really big volume comes from places like Missouri, Illinois, and Iowa,” says Mike Steenhoek (STEEN-hook), Executive Director of the Soy Transportation Coalition.
NBB Renews Request to Meet with EPA Administrator Regan
The National Biodiesel Board delivered a letter to Michael Regan, Administrator of the Environmental Protection Agency, that renewed a May 2021 request to meet with him. The NBB wants to discuss the findings from a new study called “Assessment of Health Benefits from Using Biodiesel as a Transportation Fuel.” The group points out that the study quantifies, at a community level, the public health benefits and resulting economic savings of using higher blends of biodiesel. The findings complement those of a new EPA Report that details the unequal impacts of carbon and associated emissions on socially disadvantaged communities. “We believe that our industry’s goals are consistent with your agency’s plans to address carbon and focus on environmental health,” says Kurt Kovarik, NBB Vice President of Federal Affairs. “Replacing petroleum with drop-in alternatives like biodiesel and renewable diesel will immediately reduce carbon. Also, biodiesel and renewable diesel reduce particulate matter and hydrocarbon emissions that contribute to cancer, lung, and heart disease rates.” The NBB study shows that switching from petroleum to 100 percent biodiesel in transportation could annually bring the communities studied fewer asthma attacks and other lung problems, lost workdays, and premature deaths as well as a reduction in cancer risk. “The EPA report doesn’t really discuss solutions,” Kovarik adds, “which we can provide.”
McKinney Named New CEO of NASDA
Wheat Export Sales Jump to a Marketing-Year High
Export sales of wheat rose week-to-week, while corn and soybean sales in the first full week of the 2021-2022 marketing year were impressive. The USDA says wheat sales to overseas buyers totaled 617,000 metric tons, a marketing-year high point, in the seven days ending on September 9. That’s 59 percent higher than the previous week and well above the prior five-year average. Nigeria bought almost 329,000 metric tons, followed by Mexico, South Korea, and Taiwan. Exports for the week hit 514,100 metric tons, 32 percent above the previous week. Corn sales in the first full week of the marketing year totaled over 246,000 metric tons. Mexico was the largest buyer at 154,300 metric tons, with exports of corn for the week totaling 192,000 tons. Soybean sales to offshore buyers totaled 1.26 million metric tons. China bought just over 945,000 metric tons, the top total for the week. Soybean weekly exports were 244,400 metric tons.
#FarmON Concert to Support National FFA Foundation
The Farm Journal’s #FarmON Benefit Concert on Monday night, September 20, will feature some of today’s top country music voices. At the same time, viewers who tune in can also show their support for the FFA and the work they do to develop future leaders in agriculture. Donations from the benefit concert will go to the National FFA Foundation. The hour-long concert is headlined by Easton Corbin, a three-time American Country Music Award winner. Alex Miller, who competed on American Idol season 19, will also perform. Both musicians are FFA alumni. “We are excited to provide this unique concert experience as a thank you to farmers, ranchers, and everyone who keeps our food system moving forward,” says Charlene Finck, president of Farm Journal. “What’s even more exciting is this concert features performers who have direct ties to FFA, which makes it personal to them as they team with us to support the National FFA Foundation.” The #FarmON Benefit Concert is free to all viewers and will start on Monday, September 20, at 7 p.m. Central Time. It will get shown on RFD-TV and live-streamed at www.AgWeb.com. Register for the concert for free or donate to the National FFA foundation at www.FarmJournalFieldDays.com/Register.
Monday Watch List
Markets
Back from the weekend, traders will be comparing notes on early harvest anecdotes, checking the latest weather forecasts and will also watch for any news of export sales. USDA's weekly grain inspections report is due out at 10 a.m. CDT, followed by Crop Progress at 3 p.m. USDA will post its first estimate of soybean harvest progress, along with a second report on the corn harvest.
Weather
A frontal boundary moving through the Corn Belt will produce some areas of moderate rainfall and gusty winds on Monday. Tropical moisture continues across the Southeast while moisture is pulled northward over the eastern Midwest as well. The showers will bring delays to maturing crops and harvest. The rain will mostly miss the southwestern Plains, which are in need of more moisture for winter wheat establishment, but it is turning drier behind this system.
Friday, September 17, 2021
USDA Extends Deadline to Apply for Pandemic Assistance to Livestock Producers
The Department of Agriculture is providing additional time for livestock and poultry producers to apply for the Pandemic Livestock Indemnity Program, or PLIP. Producers who suffered losses during the pandemic due to insufficient access to processing may now apply for assistance for those losses and the cost of depopulation and disposal of the animals through October 12, 2021, rather than the original deadline of September 17, 2021. PLIP is part of USDA’s Pandemic Assistance for Producers initiative. Farm Service Agency Administrator Zach Ducheneaux (DOO-shah-no) states, “We want to ensure that all eligible producers have the opportunity to apply for this critical assistance.” PLIP provides payments to producers for losses of livestock or poultry depopulated from March 1, 2020, through December 26, 2020, due to insufficient processing access as a result of the pandemic. Payments are based on 80 percent of the fair market value of the livestock and poultry and for the cost of depopulation and disposal of the animal. Eligible livestock and poultry include swine, chickens and turkeys.
U.S. Dairy Industry Advances Solutions to Deliver a More Sustainable and Secure Food System
The U.S. dairy community is reaffirming its commitment to be part of the climate solution, pledging to address its total greenhouse gas footprint. The industry is also setting goals to achieve carbon neutrality, optimize water use and improve water quality by 2050. In addition, U.S. dairy is strengthening equitable access to nutritious dairy foods worldwide while ensuring animal and employee welfare through a transparent production system. Ahead of the Food Systems Summit, the UN solicited "game-changing" ideas, initiatives and innovations that can bring about positive change. The U.S. dairy industry responded with three solutions announced in a news release Thursday. The goals include the U.S. Dairy Net Zero initiative, The National Dairy Farmers Assuring Responsible Management Program and School Nutrition and Food Bank Partnerships. Innovation Center for U.S. Dairy chairman Mike Haddad (hah-dad) states, “As food systems transformation takes center stage, the U.S. dairy sector is undergoing a transformation of its own.”
Cryan Joining AFBF as Chief Economist
The American Farm Bureau Federation Announced Thursday Dr. Roger Cryan (Cryin’) will join the organization as chief economist next month. Cryan joins Farm Bureau after serving as director of the Department of Agriculture’s Economics division for the Agricultural Marketing Service for nine years. He previously served as Vice President for Milk Marketing and Economics at the National Milk Producers Federation. At NMPF, Cryan developed and successfully led efforts to change federal milk pricing and marketing regulations, and served as an appointed member of the USDA Advisory Committee on Agricultural Statistics. Earlier in his career, Dr. Cryan served as an economist for the Federal Milk Market Administrator in Atlanta, Georgia. Farm Bureau says he has earned several awards, including the prestigious Bruce Gardner Memorial Prize for Applied Policy Analysis, presented by the Agricultural and Applied Economics Association, for his work developing the dairy payment provisions in the Coronavirus Food Assistance Program in 2020.
Latest Drought Monitor Shows Dryness Extending in the Midwest
The latest U.S. Drought Monitor shows short-term dryness expanding in the Midwest as the Western U.S. deals with a prolonged, severe drought. The Midwest dryness favors summer crop maturation fieldwork, including harvest efforts and winter wheat planting, but is reducing topsoil moisture. Meanwhile, long-term drought issues persist across the upper Midwest, despite some recent rainfall. The Department of Agriculture also reported that topsoil moisture was at least one-third very short to short in each Midwestern State except Wisconsin. Short-term dryness and drought has become more apparent in recent weeks across the southern section of the High Plains, including parts of Kansas and Colorado. Above-normal temperatures largely offset any benefit from patchy rainfall across northern California and the interior Northwest. Meanwhile, USDA reported that at least one-half of the acreage devoted to rangeland and pastures was rated in very poor to poor condition in eight of the 11 Western States.
AEM Welcomes Precision Agriculture Loan Act
Farm state Senators this week introduced the Precision Agriculture Loan Act. Nebraska Republican Deb Fischer and Minnesota Democrat Amy Klobuchar say their bipartisan legislation would create a program within the Department of Agriculture to provide loan financing to farmers and ranchers interested in purchasing precision agriculture equipment. Precision agriculture is defined as a wide range of new technologies in farming and ranching that can allow producers to reduce their environmental footprint, lower costs, and improve productivity. The Association of Equipment Manufacturers applauded the legislation Thursday. AEM President Dennis Slater states the legislation “will give U.S. farmers a whole new set of tools to help achieve climate goals while continuing to feed and fuel the world.” AEM’s own research shows that increased adoption of precision agriculture technology in the crop farming industry can have a significant environmental and economic impact for farmers. Senator Fischer adds the bill “will allow more producers to invest in the equipment they need to make their operations more efficient, environmentally-friendly, and productive.”
Cargill Introduced Regenerative Ag Revenue Stream for Farmers
One year ago, Cargill committed to advance regenerative agriculture practices across ten million acres of land in North America by 2030. Cargill has been enrolling farmers in Cargill RegenConnect, a new regenerative agriculture program that pays farmers for improved soil health and positive environmental outcomes, including payment per metric ton of carbon sequestered. The new program connects farmers to the growing carbon marketplace and will help scale the voluntary adoption of regenerative agriculture practices. Farmers enrolled in Cargill RegenConnect will implement regenerative agriculture practices of their choice beginning this fall into the next planting season. Practices that will qualify include cover crops and reduced- or no-tillage. In a study of 100 farmers across nine states conducted by The Soil Health Institute and supported by Cargill, researchers found that soil health management systems increased incomes for 85 percent of farmers growing corn and 88 percent of farmers growing soybeans. Additional details regarding Cargill's full suite of farmer programs can be found at CargillAg.com.
Friday Watch List
Markets
The University of Michigan's consumer sentiment index is due out at 9 a.m. CDT Friday and is the only official report of the day. Traders will do their usual thing of checking out the latest weather forecasts and pausing at 8 a.m. to see if USDA has another export sale to report.
Weather
Showers continue in association with the remnants of Nicholas across the Delta and Southeast, producing some locally heavy rainfall that could damage cotton and soybeans. Showers across the Central Plains into the Midwest will continue to wane this morning and be less severe along a front later today.
Thursday, September 16, 2021
Kansas City Southern Accepts Canadian Pacific Merger Agreement
Kansas City Southern Wednesday announced the termination of a merger agreement with Canadian National Railway. KCS has entered a merger agreement with Canadian Pacific Railway, presumably ending the bidding war for KCS. Kansas City Southern determined the proposal from Canadian Pacific continues to demonstrate a “Company Superior Proposal” under the pending agreement with Canadian National. Upon closing of Canadian Pacific’s voting trust, each share of KCS common stock will be exchanged for $90 in cash and 2.8 shares of CP common stock. Closing will be subject to approval by the stockholders of Canadian Pacific and KCS and regulatory approvals. In connection with the termination of the Canadian National merger agreement, KCS is paying CN a breakup fee of $700 million. Kansas City Southern will also return an additional $700 million Canadian National paid to KCS. Kansas City Southern will schedule a new Special Meeting of Stockholders for KCS stockholders to vote on the CP merger agreement.
NCC Releases Inaugural Sustainability Report
The National Chicken Council Wednesday released its inaugural sustainability report. The report provides a comprehensive overview of U.S. chickens raised for meat, known as “broilers,” and the industry’s collective progress in its environmental, broiler welfare and social impact journey, as well as efforts to build a more sustainable food system. The 2020 U.S. Broiler Chicken Industry Sustainability Report was submitted to the Scientific Group of the U.N. Food Systems Summit 2021, ahead of the U.N. Food Systems Summit later this month. NCC's report addresses six essential industry topics, including air, land and water, broiler health and welfare, employee safety and well-being, food and consumer safety, community support and security, employee safety and well-being. The report finds that between 2010 and 2020, land use decreased 13 percent, greenhouse gas emissions fell 18 percent, and water consumption declined 13 percent. View the 2020 U.S. Broiler Chicken Industry Sustainability Report here on the NCC website, nationalchickencouncil.org.
Red Angus Association Approves Gene-Edited Traits for Animal Registration
The Red Angus Association of America announced Wednesday they will provide herdbook registry of Red Angus animals carrying gene-edited traits for heat tolerance and coat color. Both trait approvals originate from specific genetic alterations designed and submitted by Acceligen, a technology company pioneering commercialization of gene-edited food animals. Acceligen has already bred and registered animals that express a trait known for better tolerance to tropical and sub-tropical heat. Black-to-red gene edits have also been made on multiple calves that will be born soon. These traits are a part of Acceligen's business portfolio that focuses on providing opportunities to the global cattle industry for better genetic management of animal well-being and health. Red Angus is the first beef breed organization to accept gene-edited animals into their registry. Tom Brink, the association’s CEO, states, “In considering the future, we see an opportunity to accelerate the Red Angus breed's genetic progress by selectively allowing gene-edited animals into our population.”
Meat Institute: Scapegoating Industry Does Not Help Consumer
The North American Meat Institute this week claimed the Secretary of Agriculture’s transparent attempts to scapegoat the meat and poultry industry to shift blame for inflationary prices will not help consumers. NAMI President and CEO Julie Anna Potts states, “Americans are experiencing firsthand what the Secretary refuses to acknowledge, the effects of COVID and lack of labor are hurting consumers, and nothing proposed by the Secretary of Agriculture on the structure of the meat and poultry industry will help families struggling to pay for groceries.” After repeated attempts to convey the challenges faced by meat and poultry packers and processors in meeting extraordinary consumer demand to Biden Administration officials, Potts sent a letter to Secretary Vilsack. The letter is in response to Vilsack’s comments during a White House press briefing earlier this month. At the time, Vilsack comments that the structure of the meat and poultry industry is causing price inflation for meat and poultry products.
Senator Stabenow to Keynote United Fresh Washington Conference
Senator Debbie Stabenow will keynote Wednesday morning's General Session Breakfast, September 22, during next week's United Fresh 2021 Washington Conference. The Michigan Democrat and Chair of the Senate Ag Committee will share insights on how to best address current policies opportunities, and obstacles facing the produce industry. In announcing the keynote, a United Fresh spokesperson states, “Senator Stabenow plays a powerful and unique role in shaping our nation’s agriculture and nutrition policies.” Next week’s Washington Conference, September 20-22 in Washington, D.C., will include face-to-face Congressional meetings as the produce industry advocates for critical issues impacting the fresh produce supply chain, including labor, food safety, nutrition policy, infrastructure and more. The event also features a Produce Advocacy Bootcamp for attendees new to communicating with Congress, workshops on public policy issues, general sessions with national leaders, and networking events as industry leaders come together in common purpose to build a stronger business climate.
Consumer Food Prices Up Slightly Again
The monthly Consumer Price Index shows a further increase in food prices. The food index increased 0.4 percent in August after larger increases in recent months. The food at home index increased 0.4 percent over the month as four of the six major grocery store food group indexes rose. The index for meats, poultry, fish, and eggs rose 0.7 percent over the month, as the beef index rose 1.7 percent. The index for fruits and vegetables rose 0.2 percent in August after declining in July. The index for dairy and related products declined in August, falling one percent after rising in each of the previous four months. The index for cereals and bakery products was unchanged in August after increasing 1.2 percent in July. The food at home index rose three percent over the past 12 months. Five of the six major food group indexes increased. The only group to decline was dairy and related products, which fell 0.5 percent over the last 12 months.
Wednesday, September 15, 2021
University of Missouri FAPRI Baseline Report: Farm Income Could Decline Next Year
Higher commodity prices are contributing to a sharp increase in U.S. net farm income in 2021. However, under current policies, farm income could drop again in 2022 as government payments decline and production expenses rise. That's according to the September University of Missouri Food and Agricultural Policy Research Institute September baseline report. In 2022, FAPRI predicts net farm income declines by $23 billion, and net cash income falls even more sharply. Reduced government payments and higher production expenses explain the decline, as there is little net change in farm receipts. In later years, projected net farm income remains fairly steady in nominal terms at just under $100 billion each year. Rising asset values and slower growth in debt reduces the sector’s debt-to-asset ratio in 2021 and 2022, temporarily reversing the trend of previous years. Lower projected farm income can halt the rise in farm real estate values in 2023, and the debt-to-asset ratio again begins to increase.
Get With Your Tax Advisor Now on Potential Tax Changes
Agriculture tax advisory firm KCoe Isom welcomed the proposed tax package that would drop previously suggested changes to the "step-up" in basis. While the legislation is far from the finish line and the proposal is far from final, KCoe's tax advisors noted that the proposed language includes changes that could significantly impact many farmers and ranchers. The firm says farmers and ranchers need to evaluate and address potential tax impacts before year-end. Other changes in the proposed tax bill, including accelerating the reversion of prior estate tax rates and estate tax exemptions, will have the potential to affect farmers without adjustments. According to KCoe's tax advisors, there are opportunities to avoid some anticipated negative effects with proper year-end planning. A spokesperson for the firm states, "Every farmer and other agriculture business owner should be talking with their tax advisors and legal counsel today to evaluate the proposed changes in this bill."
Ag Committee Leaders Applaud CFTC Nominations
The leadership of the Senate and House Agriculture Committees applaud the recent nominations by President Joe Biden to the Commodity Futures Trading Commission. President Biden nominated Rostin Behman as CFTC chair, and Kristin Johnson and Cristy Goldsmith Romero as commissioners. In 2019, Behnam spearheaded the establishment of CFTC's Market Risk Advisory Committee's Climate-Related Market Risk Subcommittee. Behnam joined the commission in 2017 as a commissioner, and since January 2021, has served as the Acting Chairman. Johnson is the Asa Griggs Candler Professor of Law at Emory University School of Law. Finally, Romero is the Special Inspector General for the Troubled Asset Relief Program. House Agriculture Chairman David Scott says, “I am very pleased with the nominees President Biden has tapped to help lead the CFTC.” Senate Agriculture Chair Debbie Stabenow adds, “I was very fortunate to work with Russ for many years and know that he is very knowledgeable and passionate about his work at CFTC.”
Trevino Nominated for USTR Chief Agricultural Trade Negotiator
President Joe Biden this week nominated Elaine Trevino for chief agricultural trade negotiator at the United States Trade Representative’s Office. Trevino is President of the Almond Alliance of California and served as a Deputy Secretary at the California Department of Food and Agriculture for Governor Arnold Schwarzenegger and Governor Gray Davis. In the announcement, the White House states Trevino "understands tariff and nontariff barriers to trade and the importance of maintaining America’s strong trade agreements and global positioning.” American Farm Bureau Federation President Zippy Duvall welcomed the nomination, stating, “Her strong roots in agriculture and her experience in America’s largest exporting state have prepared her for the challenges of representing the nation on trade issues.” Duvall adds that opportunities to create new trade agreements with the European Union and Great Britain, as well as expanding the China Phase 1 agreement, make “filling this position with the most qualified person extremely important.”
Near Record Number of Farmland Sales
The pace of land sales picked up this year for Farmers National Company. The company reports it is on track for a near-record or record sales year on several fronts. The higher land prices have spurred an increased number of landowners to sell, with some wanting to complete the sale before year-end due to uncertainty about potential tax law changes. The question becomes whether the increased sale activity will continue into 2022. Based on the calls from landowners that Farmers National Company is receiving, the company says land sales will continue to be brisk into the new year. The higher land prices continue to come into play in the sale or keep decision-making of landowners now and as they look to the immediate future. Many landowners are deciding to sell now and capture the current high prices. However, other landowners are pushing the decision to sell into 2022.
Secretary Vilsack to Attend G20 Agriculture Ministerial in Italy
Agriculture Secretary Tom Vilsack heads to Italy this week to attend the G20 Agriculture Ministers’ Meeting. The Department of Agriculture says Vilsack will reaffirm the United States’ commitment to international engagement on agriculture and make the case for joint action on climate, food security, agricultural innovation, and closer global integration through trade. The meeting seeks to build consensus around shared concerns ahead of the G20 Leaders’ Summit 2021, planned for late October in Rome. The G20’s membership, which includes 19 countries and the European Union, represents 60 percent of the world’s population, 80 percent of global GDP and 75 percent of global exports. Vilsack will deliver remarks at the G20 Open Forum on Sustainable Agriculture Thursday, along with planned personal meetings with counterparts from the European Union, Brazil, Italy and Spain. During the meeting Saturday, Vilsack will deliver remarks focusing on the G20's contributions to the United Nations' upcoming Food Systems Summit and Climate Change Conference.
Wednesday Watch List
Markets
The Federal Reserve releases its report on U.S. industrial production for August at 8:15 a.m. CDT Wednesday, followed by the Energy Department's weekly report of energy inventories at 9:30 a.m., including ethanol production. The National Oilseeds Processors Association will release its estimate of members' soybean crush in August later Wednesday morning. Traders will continue to monitor the latest weather forecasts and keep an eye out for any new export sales.
Weather
Tropical Depression Nicholas was still located over Louisiana but has weakened considerably. Rain may still be heavy around Louisiana and southern Mississippi, which could induce flooding across the southern Delta for maturing soybeans and cotton, but the system is likely to become a remnant low either today or tomorrow. A front will still produce some showers across the southern Midwest and Southern Plains as well, generally with light to locally moderate amounts.
Tuesday, September 14, 2021
JBS Grand Island Meatpacking Fire Halts Processing
A fire at the JBS Grand Island, Nebraska, processing facility halted beef packing production Monday. The Grand Island Fire Department explained via Twitter the fire was burning the roof of the facility’s rendering section. The JBS Grand Island facility is a two-shift, beef-processing plant employing more than 3,600 people. The facility’s Facebook page contained a post stating, “Fabrication and slaughter A and B shift will not be working” Monday. The facility has a daily processing capacity of 6,000 head and slaughters roughly five percent of U.S. cattle. JBS in June announced a $130 million facility improvement effort to increase production capacity at both the Grand Island facility and another in Omaha. The impacts of the fire and how it was started are unclear. JBS told Reuters Monday they expected to reopen the facility Tuesday (today). In 2019, a fire at Tyson’s Holcomb, Kansas facility took out 30,000 head of weekly processing capacity, with immediate and still lingering market disruption issues.
House Ag Dems Approve Spending Measure
House Ag Committee Democrats Monday approved an incomplete spending package as part of the Build Back Better Act. The legislation will be added with sections approved by other committees to be compiled by the House Budget Committee later this month. The agriculture spending legislation includes $18 billion in rural job-promoting investments through the Department of Agriculture’s Rural Development and $7.75 billion to support agriculture research and infrastructure. The bill also includes $1 billion to support expanded biofuel infrastructure, $4 billion for a new Rural Partnership Program, $2.6. billion for the Rural Energy for America Program, and $40 billion for forest-related programs. It does not yet include USDA’s voluntary conservation programs. Iowa Democrat Cindy Axne, who supported the spending package, states, “While I am still withholding my final decision on this package until I see the full bill, seeing these investments included will be a critical part of my choice.”
Dairy Checkoff Unveils New Fuel Up to Platy 60 Website
The dairy checkoff just updated the farmer-founded Fuel Up to Play 60 program to help students and educators navigate the school year. Fuel Up to Play 60, created by the dairy checkoff and National Football League, developed an easy-to-navigate website educator dashboard and an enhanced student app to meet these needs inside and outside the classroom. Beth Engelmann of Dairy Management Inc. states, "One of the checkoff's key priorities is ensuring dairy products and farmers' story are relevant with today's younger consumers." The website launched Monday to coincide with the "Start Fresh with Fuel Up to Play 60" initiative. The site allows educators and parents to learn about the program and access resources focused on dairy nutrition and dairy farmers' care for the environment. Fuel Up to Play 60 also will work with NFL players, dietitians and educators to share ideas on how they fuel their days on social media channels. Find the new website at www.FuelUpToPlay60.com.
AFT Adds to Policy Team to Tackle Climate Issues
American Farmland Trust just filled a new position on its policy team to tackle climate issues. Samantha Levy joins the policy team as climate policy manager to lead the organization's climate policy agenda. American Farmland Trust is preparing a multiyear strategy to advance transformational climate policy at the state and federal level, including the 2023 Farm Bill. In its most recent report, the Intergovernmental Panel on Climate Change supported the mounting interest among policymakers in regenerative farming practices as a way to mitigate climate change. A report by American Farmland Trust demonstrates that widespread adoption of just two regenerative practices on U.S. farmland, cover crops and no-till, would sequester the carbon equivalent of removing up to 260 million automobiles from American roadways each year. Previously, Levy led AFT’s climate work in New York, collaborating with farm and environmental groups to incorporate farmers into the state's Climate Leadership and Community Protection Act.
U.S. Tractor and Combine Sales Increased in August
U.S. tractor sales increased last month compared to 2020 while combine sales jumped 19.8 percent, according to the Association of Equipment Manufacturers monthly sales report. Combine sales posted the second month in a row of growth near 20 percent in the United States, and total farm tractor sales climbed 9.9 percent. Sub 40 horsepower tractor sales were up 8.7 percent, and mid-sized, 40-100 horsepower, sales were up 5.4 percent. Heavy-duty units saw significant growth, with the articulated four-wheel drive segment leading the way for the fourth straight month by climbing 40.4 percent to 306 units sold. Year-to-date farm tractor sales remain up 13.3 percent and combines up 13.8 percent. For Canada, total farm tractor sales were up 1.9 percent and combine sales were up 28.7 percent. AEM’s Curt Blades states, “Farmers investing in more of these big machines is another indicator of that farmer optimism we’ve been seeing.”
Weekly Fuel Prices Move Lower
Gasoline and diesel prices slipped in the last week as refineries recover from Hurricane Ida. However, Tropical Storm Nicholas threatens refineries in the Houston area, and could pause further declines this week. The weekly average gas price fell 1.9 cents per gallon to $3.15 and the average diesel price slipped less than a half-cent to $3.29 per gallon. Gas Buddy analyst Patrick De Haan states, “While Nicholas would appear to be a minor storm, we could see a deluge of water – the same issue that caused some significant damage in Ida’s wake to refineries in Louisiana.” Meanwhile, gasoline demand continues to decline for the fourth week in a row as the summer driving season ends. Nationally, weekly gasoline demand fell 1.8 percent from the prior week. Crude oil prices have seen upward as some oil production in the Gulf of Mexico remains offline following Hurricane Ida, and oil inventories are down six percent from the five-year seasonal average.
Tuesday Watch List
Markets
The U.S. Labor Department reports on the August consumer price index at 7:30 a.m. CDT Tuesday, the only official report of the day. Traders will be watching the latest weather forecasts and for any news of an export sale.
Weather
Scattered showers will move through the Central Plains to the Midwest along a front on Tuesday and could be severe. Tropical Storm Nicholas, which was briefly a hurricane Monday night, will produce heavy rainfall for eastern Texas into Louisiana on Tuesday and could cause some flooding. This could impact recovery efforts in Louisiana to get power restored to terminals around the Port of New Orleans as well as flood mature cotton and soybean crops in the southern Delta.
Monday, September 13, 2021
Court Denies Petition for Rehearing on Year-Round E15
The D.C. Circuit Court of Appeals denied a petition for a rehearing in the case of the American Fuel and Petrochemical Manufacturers vs. EPA Decision. In that case, the court vacated a 2019 regulation allowing year-round sales of E15. The Renewable Fuels Association, Growth Energy, and the National Corn Growers Association released a joint statement expressing disappointment. “Our petition for a rehearing was an opportunity for the D.C. Circuit Court to remedy a decision that runs counter to legal precedent and which, if maintained, threatens our nation’s rural economy and progress on moving toward a clean energy future,” the groups say in the statement. “Today’s petition denial is another hurdle to ensuring year-round access to low-carbon E15, but due to the timing, American drivers and retailers will be able to finish out the E15 summer driving season without disruption to their access to cleaner fuel choices at the pump.” The groups say moving forward that they’ll continue to push for a permanent remedy long before the start of next year’s summer driving season. In 2019, the EPA issued its final rule extending the Reid Vapor Pressure volatility waiver to E15, allowing the fuel to be sold year-round in conventional gasoline markets. Oil refiners soon after challenged the rulemaking in the D.C. Court of Appeals.
USDA Accepts Over 2.5 million Acres in Grassland CRP Signup
The USDA accepted offers for more than 2.5 million acres from agricultural producers and private landowners for enrollment through this year’s Grassland Conservation Reserve Program Signup. This is double last year’s enrollment and brings the total acres enrolled across all CRP signups in 2021 to more than 5.3 million acres, surpassing USDA’s goal of four million acres. Producers and landowners submitted offers for nearly four million acres in Grassland CRP, the highest in the signup’s history. “This increased interest in working lands conservation serves two purposes,” says Zach Ducheneaux (DOO-shah-no), Farm Service Agency Administrator. “It helps close the gap between the enrollment and available acres, and it leaves room for the administration to be innovative with the other conservation tools, such as the Conservation Reserve Enhancement Program, at our disposal as we work to enlist non-traditional partners in our conservation efforts.” He also points out that grasslands sequester an incredible amount of carbon in their roots that are resilient even during drought and wildfires. It also provides good wildlife grazing habitat and grazing opportunities for producers and landowners. “There’s no better way to increase soil health than with thoughtful animal impact,” Ducheneaux adds.
USDA Releases WASDE/Crop Production Reports
USDA released the Crop Production and World Agricultural Supply and Demand Estimate Reports. USDA is calling for higher corn and soybean production in the U.S. Corn production is forecast at 15 billion bushels, up 246 million bushels from last month on increases to harvested area and yield, which is 176.3 bushels per acre, up 1.7 bushels. Harvested area is 85.1 million acres, up 600,000. The U.S. corn outlook is for larger supplies, increased feed and residual use, greater exports, and higher ending stocks. The season-average corn price dropped 30 cents to $5.45 a bushel. Soybean production is predicted at 4.37 billion bushels, up 35 million with lower harvested area more than offset by a higher yield forecast of 50.6 bushels per acre. The area harvested for soybeans is predicted to be 86.4 million acres, lower than last month but five percent from last year. Soybean supply and use changes include higher beginning stocks, production, exports, ending stocks, and a lower soybean crush rate. The season-average price is down 80 cents to $12.90 per bushel. The U.S. wheat outlook is for reduced supplies, slightly higher domestic use, unchanged exports, and decreased ending stocks. The season-average farm price dropped ten cents to $6.60 a bushel for wheat.
USCA Applauds Administration Message on Consolidation and Competition
Last week, the White House hosted a press conference featuring Ag Secretary Tom Vilsack and Brian Deese, the Director of the National Economic Council, to discuss the meatpacking sector. Both Vilsack and Deese talked specifically about the impacts of a highly concentrated meatpacking sector for American producers and consumers. A White House release outlined how the Big Four meatpackers are generating record profits during COVID-19 and doing so at the expense of consumers, farmers, and ranchers. U.S. Cattlemen’s Association President Brooke Miller says that the White House seeing the need for increased competition in the marketplace is a testament to the many agricultural producer and consumer voices who’ve been advocating for change. “COVID highlighted what we already knew to be true,” Miller says. “A lack of transparency and true price discovery hurts independent producers and processors and inflates beef prices at the retail counter.” The USCA says this is an important first step towards addressing the problem of concentration in the meatpacking sector. “We look forward to working with the USDA, including the new advisor for Fair and Competitive Markets, to investigate illegal and anti-competitive practices in the cattle marketplace,” Miller adds.