Senate Ag Leaders Urge USTR to Hold Canada Accountable Under USMCA

Leaders of the Senate Agriculture Committee urge the U.S. Trade Representative to hold Canada accountable under the U.S.-Mexico-Canada Agreement. Senators Debbie Stabenow, a Michigan Democrat, and John Boozman, an Arkansas Republican, say Canada is obligated by USMCA to provide market access to American dairy farmers. Despite numerous rounds of consultation and an initial dispute settlement panel ruling in January 2022, Canada continues to reserve parts of its tariff-rate quota allocations for domestic processors, undermining importers' market access. In a letter to Ambassador Katherine Tai, the Senators call on USTR to initiate a second dispute settlement panel to hold Canada accountable to its market access obligations to American dairy farmers. There has been no improvement in Canada's TRQ administration despite the USTR’s continued engagement. The Senators write, “To bring Canada into compliance with its commitments to U.S. dairy producers, we urge USTR to move forward with a second dispute settlement case to implement USMCA’s dairy provisions fully and properly to increase U.S. dairy market access.”

2022 Census of Agriculture Deadline Nears

The deadline to respond to the 2022 Census of Agriculture is next week. USDA's National Agri Statistics Service says farmers and ranchers must respond by February 6 online or through the mail. NASS Administrator Hubert Hamer says, "By participating in the 2022 Census of Agriculture, producers show the value and importance of American agriculture." Last month, NASS mailed the Census of Agriculture questionnaires to every known ag producer in the U.S. and Puerto Rico. Conducted just once every five years, the ag census provides a complete account of the nation's farms and ranches and the people who operate them. Responding to the Census of Agriculture is required by federal law, and law requires NASS to keep all individual operations' information confidential, use the data for statistical purposes only, and publish the data in aggregate form to prevent disclosing the identity of any individual producer or farm operation. Producers can respond online at agcounts.usda.gov.

USDA Announces $2.7 Billion in Rural Electric Infrastructure Funding

Agriculture Secretary Tom Vilsack Monday announced a $2.7 billion investment to help 64 electric cooperatives and utilities. The funding from the Department of Agriculture will help the cooperatives expand and modernize the nation’s rural electric grid and increase grid security. Vilsack says, “This funding will help rural cooperatives and utilities invest in changes that make our energy more efficient, more reliable, and more affordable.” The loans include $613 million to help rural utilities and cooperatives install and upgrade smart grid technologies. Smart grid can be a catalyst for broadband and other telecommunications services in unserved and underserved rural areas, in addition to improving grid security and reliability. Nearly half of the awards will help finance infrastructure improvements in underserved communities. USDA's Electric Loan Program can help finance wind, solar and natural gas plants, as well as improvements to produce cleaner energy from coal-fired plants. In the coming months, USDA will announce additional energy infrastructure financing.

State Attorneys General Seek Year-Round E-15

Last week, Iowa Attorney General Brenna Bird led a bipartisan coalition of seven Attorneys General urging the Biden Administration to follow the law and allow the sale of year-round E-15. Federal law permits Governors to request that the EPA issue the regulations allowing E15 and requires the EPA to issue the regulations within 90 days. The sale of E15 has been restricted during the summer peak-driving months due to an outdated provision of the Clean Air Act. Iowa Governor Kim Reynolds led a bipartisan coalition of Governors making the request on April 22, 2022, but the EPA still has not issued the regulation as required by law. Earlier this month, Governor Reynolds, again wrote to the Biden Administration reiterating her request that the mandatory regulations be issued in response to their request. Attorney General Bird and the Attorneys General of Illinois, Minnesota, Missouri, Nebraska, South Dakota, and Wisconsin signed the letter to the White House and the Environmental Protection Agency.

American Dairy Coalition Sets 2023 Policy Priorities

American Dairy Coalition, a grassroots dairy farmer-led organization with diverse geographic representation, recently announced federal policy priorities and an action plan for 2023. American Dairy Coalition CEO Laurie Fischer says, “Our ongoing efforts have been focused on raising awareness of short- and long-term challenges.” One key short-term priority is to see the Class I milk price 'mover' returned to its previous 'higher of' formula in the 2023 Farm Bill. For the long-term, the coalition seeks a national Farm Bill hearing on the sustainability of Federal Milk Marketing Orders. Fischer says, “The systemic issues of declining fluid milk sales and declining FMMO participation create instability and uncertainty for dairy farmers.” ADC also supports restoring whole milk in federal nutrition programs like National School Lunch and Breakfast Programs and WIC. This includes exempting nutrient-dense foods like whole milk from the fat limits the Dietary Guidelines impose on nutrition programs and dairy checkoff promotions.

Rotational Grazing Adoption Varies by Region

Data published Monday by USDA’s Economic Research Service shows rotational grazing adoption varies by region. Rotational grazing is a management practice in which livestock are cycled through multiple fenced grazing areas to manage forage production, forage quality, animal health, and environmental quality. In a recent study, USDA researchers found the highest rate of total rotational grazing adoption, at 49 percent of operations, in the Northern Plains and Western Corn Belt region. The lowest participation level, at 25 percent, were operations in the Southern Plains region. Basic rotational grazing was more common than intensive rotational grazing in all but one region. USDA says the exception was the Appalachian region, where 25 percent of cow-calf operations used intensive rotational grazing, and 22 percent used basic rotational grazing. Major drivers for regional differences in adoption could include varying forage types, which may respond better to rotational grazing than others, and differing climates.

Tuesday Watch List

Markets

At 7:30 a.m. CST Tuesday, the U.S. Labor Department will release its employment cost index for the fourth quarter, a factor for the Fed to consider in this week's meeting. At 9 a.m., the Conference Board's index of U.S. consumer confidence will be out, followed by USDA's Jan. 1 cattle inventory at 2 p.m., anticipating a 3% or 4% annual decline.

Weather

A sharp cold front remains across the southern states on Tuesday, which will continue to be active. Showers are already moving through this morning and more will develop later today from Texas and Oklahoma eastward to Virginia and points south. Behind the front it is very cold with another day of well below-normal temperatures. The cold will cause another day of freezing rain, snow, and sleet accumulation in some areas of the South-Central states.

Senators Ask White House for Enforcement Actions on USMCA

The top members of the Senate’s Finance Committee sent a letter to the White House asking the administration to pursue enforcement action against Canada and Mexico under the USMCA. Inside Trade says they’re concerned about areas where Canada and Mexico aren’t complying with the agreement’s rules, especially around energy and agriculture. Ron Wyden and Mike Crapo (CRAY-po), the top Democrat and Republican on the committee, sent the letter saying, “The Office of the USTR must continue pursuing full implementation and, where necessary, robust enforcement of the U.S.-Mexico-Canada Agreement.” They also noted that the pact’s full potential remains unrealized. Wyden and Crapo highlighted the current dispute with Mexico over its policy regarding GMO corn imports, as well as Canadian failure to comply with the rules regarding tariff-rate quotas on dairy products. The U.S. recently requested dispute-settlement consultations for a third time regarding Canada’s dairy policy. U.S. and Mexican discussions recently continued last week.

Reaction to Bronaugh’s Decision to Step Down from USDA Post

USDA Deputy Secretary Jewell Bronaugh announced she’ll be leaving her post at the end of February. American Farm Bureau Federation President Zippy Duvall says his organization has enjoyed working with the deputy secretary for the last two years of her tenure with the agency. “We want to thank her for her service to America’s farmers and ranchers,” Duvall says. “She has long been someone who understands the needs of farmers and rural communities. We’ve appreciated her leadership and wish her all the best in her future endeavors.” House Ag Committee Ranking Democrat David Scott congratulated Bronaugh on a job well done. “Deputy Secretary Bronaugh’s time at the department was historic, serving as the first African American woman in the role,” Scott says. “During her time as Deputy, she uplifted American agriculture and our rural communities, something she’s long done throughout her career.” Scott also says she’s a champion for U.S. food and agriculture.

Organic Produce Sales Up Three Percent, Volume Down Four Percent

Organic fresh produce sales grew by three percent last year while total volume dropped by 3.7 percent. The Organic Produce Network says total sales topped $9.4 billion for the year. The 2022 Organic Produce Performance Report says the fresh berry category was the top organic produce category with more than 16 percent of organic fresh produce dollars in 2022. Fresh berry sales topped $1.6 billion for the year, with organic packed salads a close second at $1.55 billion. Total fresh produce sales gained 7.3 percent in dollars during the year but dropped 1.3 percent in volume from the prior year. During 2022, 13 of the top 20 organic produce categories by total sales posted increases in dollars, with organic onions generating the largest increase at 15.4 percent. That increase was followed by cucumbers, potatoes, and avocados. Organic performance in 2022 was consistent across the nation as dollars grew and volume declined.

Energy Department Allocates $118 Million to Biofuel Projects

Late last week, the Department of Energy announced $118 million in funding to help expand U.S. biofuel production. Growth Energy CEO Emily Skor says the funds will undoubtedly accelerate the innovations taking place at U.S. ethanol plants. “It will open many new opportunities for low-cost, low-carbon energy,” Skor says. She also points out that the president himself has said there will be no achieving the goal of net zero by 2050 without biofuels, and the announcement shows that the DOE is committed to that mission. “We are excited to see new technologies scaled up with these funds, particularly the work underway at Marquis, Inc., a Growth Energy member that received $8 million for a project that combines CO2 with low-carbon hydrogen to create a new production stream of extra-low-carbon ethanol.” A project like that will end up slashing carbon emissions by at least 70 percent or more compared to petroleum-based alternatives.

U.S. Wants WTO Dispute System Fixed by 2024

The U.S. is currently in a third round of talks to redo the World Trade Organization’s trade dispute arbitration system. The U.S. Ambassador to the WTO told Reuters that America wants it to be fully up and running by the end of 2024. The WTO’s appeals bench rules on top disputes among nations. It’s been out of service for two years due to U.S. appointment blockages put in place during the Trump Administration. The current administration has resisted calls by WTO members to approve the appointments and has been leading the negotiations on how to redo the dispute system. Asked if it was even possible to revive the Appellate Body, Deputy U.S. Trade Representative Maria Pagan didn’t say no. “It needs a lot of revamping,” she says. The U.S. has criticized the WTO’s alleged overreach and lengthy processes, and it strongly contested some of the WTO’s recent rulings against America.

Corn Sales to Overseas Buyers Drops 20 Percent

The U.S. Department of Agriculture says export sales of corn fell in the seven days that ended on January 19, while soybean and wheat sales improved. During the week, corn sales to overseas buyers totaled 910,400 metric tons, a 20 percent drop week-to-week but up 46 percent over the prior four-week average. Mexico was the biggest buyer at 407,000 metric tons, followed by Columbia. Exports for the week came in at 912,000 metric tons, up 28 percent from the previous week. Soybean sales rose 16 percent week-to-week and 53 percent from the average to 1.15 million metric tons. China bought more than 940,000 metric tons, with the Netherlands a distant second at 67,100 tons. Exports for the week hit 1.9 million metric tons, down eight percent from the previous week. Wheat sales were up six percent over the prior week and 84 percent from the previous four-week average. Exports dropped 15 percent.

Top 5 Things to Watch - Key Happenings the Newsroom is Tracking for the Week of Jan. 29-Feb. 4

OMAHA (DTN) -- Here are the Top 5 things the DTN Newsroom is tracking for the week of January 29. Watch for coverage of these and other topics through the week on our subscription platforms as well as on DTNPF.com.

1. Winter roller coaster on track: It will be a cold week in the Plains and Upper Midwest as a visit from the polar vortex comes through North America. January is going to end as it normally would be all month long -- in the freezer, thanks to La Nina. February looks to be below normal for the western half of the country while the east stays warm. This should set the stage for an active storm track through the middle of the country. The arctic front at the leading edge of the polar vortex cold snap will be no different with several periods of precipitation sliding along it as it treks south. The cold won't last long, though, and the continent will get at least a brief break late this week. DTN Ag Meteorologist John Baranick is watching the next round of cold air entering the west Feb. 6.

2. Still dry in South America: While most of us will be watching and dealing with U.S. weather fronts, grain traders will be attuned to the south. Will La Nina, weakened but hanging on, continue to deny South American farmers needed rainfall for their developing crops? DTN Lead Analyst Todd Hultman also reminds us that the Fed could bump the federal funds rate another 0.25% Wednesday.

For more markets-related events that DTN will be watching and reporting on, see Hultman's "What DTN is Watching" section found elsewhere on DTN digital platforms.

3. Back to the Garden: While crop models churn over where the "garden spot" may be in 2023, Progressive Farmer Senior Editor Joel Reichenberger will take us to the Garden State for a visit with the Santini family. The frequent National Corn Growers Association (NCGA) corn yield winners from New Jersey talk about what it's like to push yields and profits in an area where fields are small, spread far apart, and surrounded by lots and lots of nonfarm residents.

4. Cattlemen meet: Cattle producers are gathering in New Orleans for their annual Cattle Industry Convention & NCBA Trade Show. Progressive Farmer Senior Editor Vicki Myers will be reporting from the event, and DTN Livestock Market Analyst ShayLe Stewart will be on hand to gather the latest market intelligence as we work through winter.

5. Weed Experts in D.C.: On the crops side, DTN Crops Editor Jason Jenkins will be in Washington, D.C. for the Weed Science Society of America's annual meeting. Hot topics he'll keep tabs on during the event include the EPA's Endangered Species Act workplan, which has implications for future pesticide registration/use; latest public research on cover crops and weed management; and a look at some novel approaches to controlling weeds.

Monday Watch List

Markets

Back from the weekend, traders will be paying close attention to South America's weather reports and forecasts and any outside news that might have occurred. There will also be interest in how cold temperatures got in the southwestern Plains. USDA's weekly report on export inspections is due out at 10 a.m. CST. Traders are also aware the Fed is expected to raise the federal funds target by 0.25% on Wednesday.

Weather

Very cold air in association with an arm of the polar vortex continues to settle into much of the Plains and western half of the Midwest Monday. The cold threatens livestock and any exposed wheat. The front is hung up from Texas to the Ohio Valley and periods of showers will develop along and behind the front over the next few days as it slowly sinks farther southeast this week. That will induce some wintry mix of freezing rain and snow across the Southern Plains up into the eastern Midwest over the next 24 hours.

Agriculture Deputy Secretary Jewel Bronaugh to Step Down

Agriculture Deputy Secretary Jewel Bronaugh announced Thursday her intention to step away from her role at USDA. Bronaugh says, “It is with mixed emotions that today I am announcing that I will step away from my role as Deputy Secretary in the coming weeks so I can spend more time with my family.” President Biden nominated Bronaugh to USDA in January of 2021 and was confirmed by the Senate in May of that year. Bronaugh, in 2018 was appointed as the Virginia Department of Agriculture and Consumer Services Commissioner. She previously served as the Virginia State Executive Director for the USDA Farm Service Agency during the Obama administration. She was the first Black woman to hold the second-in-command position at USDA. Bronaugh thanked Secretary Tom Vilsack for his support, adding, “I now look forward to taking some time off to spend more quality time with my mom, husband and four children."

Retail Food Price Inflation in 2022 Surpassed 2021 Rates

Food-at-home prices increased by 11.4 percent in 2022, more than three times the rate in 2021 of 3.5 percent, according to USDA’s Economic Research Service. The increase was also much faster than the two percent historical annual average from 2002 to 2021. All food categories except beef and veal grew faster in 2022 than in 2021. In 2022, price increases surpassed ten percent for food at home and for nine food categories. Egg prices grew at the fastest rate ,2.2 percent, after an outbreak of highly pathogenic avian influenza throughout 2022. Prices for fats and oils increased by 18.5 percent, largely because of higher dairy and oilseed prices. Prices also rose for poultry, 14.6 percent, and other meats, 14.2 percent. Elevated prices for wholesale flour and eggs contributed to a 13.0-percent price increase for cereals and bakery products. Prices for beef and veal, fresh vegetables and fresh fruits rose more slowly, but all categories exceeded their historical averages.

Report: Brazil Soybean Crop up 18% From Last Year

Industry Economists expect the harvest of a large soybean crop in Brazil in the next 30 to 45 days. AgResource predicts USDA and others will be forced to raise Brazilian soybean production estimates by one million to three million tons, or 37 million to 110 million bushels. A crop of at least 150 million tons versus 129.5 million last year is guaranteed, according to their research. AgResource's final yield estimate in Mato Grosso, by far the country's largest producing state, is 60.3 bushels per acre after revisiting possible harvest losses and disease pressure. This is eight bushels per acre more than Brazil’s CONAB current forecast. There will be yield loss in the far south of Brazil, but yield gains in Mato Grosso and surrounding states will more than offset any yield hit. Harvest losses will likely result from new incurable diseases. But there is very little doubt a massive Brazilian soybean crop will be available to the global marketplace in the coming weeks.

Research Identifies $400 Million in Unrealized Soybean Value

A new partnership aims to increase soybean flower and pod retention. This unrealized value could bring $50 per acre or $400 million in economic return for U.S. soybean farmers, according to the United Soybean Board. The collaborative focus will test how heat and drought impact flower bud retention. Flower production dictates the final pod number and, ultimately, yield in soybeans. The Atlantic Soybean Council, Mid-South Soybean Board, North Central Soybean Research Program, Southern Soybean Research Program and United Soybean Board all agree this is a priority issue impacting the entire industry. Although flower retention is a leading cause of soybean yield loss in the U.S., no organized effort exists to address it. Farmers experience about 30 percent of flower loss under favorable conditions and up to 80 percent under drought and heat stress. Texas Tech University, in collaboration with Kansas State University, the University of Missouri and the University of Tennessee, will lead the research on this national effort.

First All-Steel Swine Barns to Provide Improved Efficiency and Animal Health

A new sow complex is now under construction featuring the first prefabricated steel swine barns in the United States. Compared to traditional wood structures, the steel buildings are designed to offer a more biosecure, flame-retardant and energy-efficient environment for pigs, while also being more durable and faster to build. The 12,000-head sow facility is scheduled for completion this summer in South Dakota. The steel building package, designed by C-Lines, is being provided by AP, AGCO’s swine equipment brand. AP dealer Ag Property Solutions is constructing the barns, which will be managed by Pipestone Management. The all-steel buildings offer increased construction speed and efficiency, increased building strength, energy efficiency, better biosecurity, along with being easily transported as a prefabricated structure. The new facility is the largest sow complex ever constructed by Ag Property Solutions, with a footprint of up to 55 acres. It includes a 187,500-square-foot farrowing barn and gilt developer unit and a 225,000-square-foot gestation barn that incorporate the steel panels.

FFA to Participate in the Advancing Racial Equity Community of Practice Initiative

The National FFA Organization Thursday announced its participation in a new community of practice with other nonprofit organizations focused on advancing racial equity. Over the next six months, leaders in the National FFA Organization will work with The Bridgespan Group to strengthen their approach to advancing racial equity internally and externally. The Advancing Racial Equity Community of Practice, led by The Bridgespan Group, is funded by the Walmart Foundation. The funding will assist in supporting FFA to collaborate with others to share best practices and learnings on their work to prioritize equity. National FFA CEO Scott Stump says, “By partnering with other nonprofits through this initiative, we can expand our capacity to seek and promote inclusion and diversity in our membership.” FFA is participating in the cohort alongside nine organizations: American Red Cross, Center for the Future of Arizona, Education Design Lab, Goodwill Industries International, National Voluntary Organizations Active in Disaster, Team Rubicon, The Recycling Partnership, Winrock International, and World Wildlife Fund. 

Friday Watch List

Markets

The U.S. index of personal consumption expenditures will be out at 7:30 a.m. CST Friday, an indicator of inflation watched by the Fed. The University of Michigan's index of consumer sentiment follows at 9 a.m. Traders will continue to watch the latest weather forecasts, especially in South America.

Weather

A clipper system moving through the Upper Midwest is dragging a cold front through the North-Central U.S. Friday. Breezy winds continue near the storm center in the Upper Midwest. Cold air over Canada will gradually fill in behind the front later in the day, resulting in well-below normal temperatures for the weekend. In addition to the cold, the front will be bringing scattered snows, some of which may be heavier near the northern Rockies and also near the South Dakota-Nebraska border through Friday night.

Senate Ag Plans Hearings on Farm Bill Trade and Horticulture Titles

The leadership of the Senate Agriculture Committee Wednesday announced a set of farm bill hearings. Senators Debbie Stabenow and John Boozman will hold the first hearing on February 1, titled. "Farm Bill 2023: Trade and Horticulture." The hearings will focus on the trade and horticulture titles of the farm bill. The first hearing will include testimony from USDA's Alexis Taylor, Jenny Lester Moffitt, and USAID's Sarah Charles. In a joint statement, Stabenow and Boozman say, "This is the first of many hearings the Committee has planned as we gear up for the 2023 Farm Bill," adding, "We are both looking forward to a collaborative process, working with all Senators to deliver a strong Farm Bill." The duo announced three other upcoming hearings: February 9 on Commodity Programs, Crop Insurance and Credit, February 16 on Nutrition Programs, and March 1 on Conservation and Forestry Programs. All hearings will be held in the committee’s hearing room.

Lawsuit Against FDA Targets Antibiotics Use in Livestock

Public health advocacy groups filed a lawsuit against the Food and Drug Administration this week. The groups say the lawsuit challenges the refusal to phase out unnecessary uses of antibiotics in animal agriculture. The groups include the Alliance of Nurses for Healthy Environments, the Natural Resources Defense Council, Food Animal Concerns Trust, Public Citizen and Earthjustice. They allege that approximately two-thirds of medically important antibiotics sold in the U.S. are for use in food-producing animals and are often administered to healthy animals to compensate for the higher risk of infections typically caused by cramped, unsanitary or stressful conditions. The lawsuit claims that the misuse of these medicines has contributed to the rise and spread of antibiotic-resistant bacteria. Steven Roach of Food Animal Concerns Trust says, "The FDA has allowed giant meat companies to habitually overuse antibiotics putting everyone's health at risk," adding, "This is absolutely unnecessary as animals raised under healthy conditions do not need routine antibiotics."

Substantial Consolidation in Retail Food Market Since 1990

The U.S. food retail sector experienced substantial consolidation over the last three decades, according to data from USDA’s Economic Research Service. Market concentration, as measured by the Herfindahl-Hirschman Index, is a measure of the extent to which market shares are concentrated between firms of the retail food sector at the national, state, metropolitan statistical area, and county levels. The analysis includes all establishments with a significant portion of food sales that are likely substitutes for each other: supermarkets and other grocery and warehouse clubs and supercenters. Although the national market is less concentrated than the average State level, according to the HHI, national market concentration increased substantially between 1990 and 2019 at 458 percent. In comparison, average county-level market concentration has remained relatively constant over the past 30 years, increasing only 94 percent. While national measures provide information about larger trends, trends in localized markets are likely more relevant for consumers, food-retail competitors, and policymakers, according to USDA.

Organic Farmers Association Applauds Additional Assistance for Dairy Farmers

The Organic Farmers Association welcomes this week's announcement of emergency financial relief to organic dairy farmers by the Department of Agriculture. The association has called on lawmakers and the Biden administration to help offset the high cost of production. USDA's Farm Service Agency fulfilled the mandate on time, announcing plans to distribute funding on Monday, January 23. The newly announced Organic Dairy Marketing Assistance Program will be administered by USDA's Farm Service Agency and will cover up to 75 percent of projected 2023 marketing costs for eligible organic dairy producers - targeting small and mid-sized operations. Organic Farmers Association Executive Director Kate Mendenhall says, "We applaud Congress for prioritizing family farms in crisis and prioritizing this emergency relief." New York organic dairy farmer Liz Bawden adds, "Organic dairies have had a very difficult two years, and this relief funding will hopefully make it to dairies in time to keep them in business." 

World Food Prize Names Branstad as President

The World Food Prize Foundation announces this week that former U.S. Ambassador to China Terry Branstad will join the organization as its President. World Food Prize Foundation Chair Paul Schickler says, "We are excited to bring on a leader with both global vision and strong roots in agriculture.” Branstad was Iowa's longest-serving governor and holds the record as the longest-serving governor in the history of the United States. He held the office of Governor of Iowa from 1983 until 1999, and then again from 2011 until 2017, when he was appointed U.S. Ambassador to China. He is a partner with the Branstad Churchill Group, LLC. The World Food Prize is presented each year in Iowa to an individual for their achievements in improving the quality, quantity, and availability of food in the world. The $250,000 award is presented each October in a ceremony at the Iowa State Capitol that attracts global leaders and participants.

Consumer Brands Association Supports New Trucking Legislation

The Consumer Brands Association endorsed a new, bipartisan bill, this week. The Safer Highways and Increased Performance for Interstate Trucking Act, or "SHIP IT Act," would boost trucking capacity, improve supply chain efficiency and keep costs down for consumers. The SHIP IT Act was introduced by U.S. Representatives Dusty Johnson, a South Dakota Republican, and Jim Costa, a California Democrat. The legislation aims to address supply chain pinch points by increasing shipping capacity, lessening burdens on truck drivers and providing incentives to recruit and retain new drivers. The bill also modernizes the emergency use of certain vehicle waivers, offers workforce grants for truck drivers, simplifies the commercial driver's license process and tackles truck parking concerns. Consumer Brands vice president of supply chain Tom Madrecki says, “Ultimately, each step to enhance our supply chains with the latest tools and technologies available will ensure operations run as seamlessly as possible despite future disruptions.”

Thursday Watch List

Markets

USDA's weekly export sales report is due out at 7:30 a.m. CST, the same time as U.S. weekly jobs claims, the first estimate of fourth quarter U.S. GDP, December durable goods orders and an update of the U.S. Drought Monitor. December new home sales are out at 9 a.m., followed by U.S. natural gas storage at 9:30 a.m. Weather remains a big part of trader focus every day and export sales announcements have become more active lately.

Weather

Light snow continues behind a system across the eastern Midwest and Northeast Thursday. But the bigger story is a clipper system in the Canadian Prairies that will dive into northern Minnesota by Thursday evening. The system will bring scattered showers through both the Canadian Prairies and North-Central U.S. along with strong winds. Initially, temperatures will rise, but a strong cold front will pass down through the Canadian Prairies Thursday night and into the Northern Plains on Friday when temperatures will drop significantly.

NCBA Sues Biden Administration to Overturn Lesser Prairie Chicken Listing

The National Cattlemen’s Beef Association recently filed a Notice of Intent to sue the Department of the Interior and the U.S. Fish and Wildlife Service. NCBA is planning the lawsuit over the listing of the lesser prairie chicken under the Endangered Species Act. NCBA Associate Director of Government Affairs Sigrid Johannes says, “The lesser prairie chicken only survives today because of the voluntary conservation efforts of ranchers,” adding, “There are numerous places where this listing goes seriously wrong and we are defending cattle producers against this overreaching, unscientific rule.” The listing was previously set to take effect at the end of January, but thanks to pressure on the Biden administration from NCBA and our allies in Congress, the rule was delayed by 60 days. The listing will now take effect on March 27, 2023, and the states included in the species’ range are Kansas, Texas, Oklahoma, New Mexico, and Colorado.

Corn Growers Praise Biden Officials for Stance on Biotech Corn

The National Corn Growers Association praised the Biden administration for issuing an official rejection of a recent proposed compromise from Mexico on biotech corn imports into the country. The development came during a meeting between Mexican officials and U.S. Department of Agriculture’s Secretary of Trade and Foreign Agricultural Affairs Alexis Taylor and the Office of the U.S. Trade Representative’s chief ag negotiator Doug McKalip. In a statement that came after the meeting, USTR and USDA said the changes offered by Mexico “are not sufficient and Mexico’s proposed approach, which is not grounded in science, still threatens to disrupt billions of dollars in bilateral agricultural trade, cause serious economic harm to U.S. farmers and Mexican livestock producers, and stifle important innovations needed to help producers respond to pressing climate and food security challenges.” NCGA President Tom Haag responded, “This is significant development and good news for corn growers.” Mexico announced in late 2020 a decree banning biotech corn into the country, beginning in early 2024.

Biden Again Nominates Dean and Schlanger to USDA

President Joe Biden again nominated Margo Schlanger and Stacy Dean to politically appointed positions at the Department of Agriculture. Biden nominated Schlanger to serve as Assistant Secretary for Civil Rights and Dean as Undersecretary for Food, Nutrition, and Consumer Services. Both were nominated by the President to USDA during the last Congress but were not confirmed by the Senate. Agriculture Secretary Tom Vilsack says Dean’s commitment during her time at USDA and throughout her career “makes her the ideal person to serve as Under Secretary for FNCS.” Throughout her life and career, Schlanger has devoted herself to civil rights and to public service. At the Department of Homeland Security. Vilsack says, “Schlanger would be able to continue her commitment to public service and civil rights as we at USDA continually seek to fairly and equitably serve our employees and customers.” The nominations of Schlanger and Dean were part of a slate of political appointees announced this week by the White House.

Cattle Accounted for Largest Portion of US Animal Receipts in 2021

U.S. farm cash receipts from animals and animal products totaled $195.8 billion in 2021, led by receipts for cattle and calves at $72.9 billion, or 37 percent. USDA’s Economic Research Service reports that poultry and egg products made up the next largest share of 2021 cash receipts at $46.1 billion, or 24 percent, followed by dairy at $41.8 billion, or 21 percent, hogs at $28.0 billion or 14 percent, and other animals and animal products at $7.0 billion, at four percent. As part of its Farm Income and Wealth Statistics data product, in late August or early September each year, the Economic Research Service releases estimates of the prior year’s farm sector cash receipts from agricultural commodity sales. The data provided includes cash receipt estimates by type of commodity, which can help in understanding the U.S. farm sector. The estimates may be revised as new information becomes available.

IFEEDER Releases Materials to Support Industry Sustainability Progress

The Institute for Feed Education and Research Tuesday released its Animal Food Industry Sustainability Toolkit. The toolkit is intended to drive continuous improvement in the full feed value chain. The Institute also shared its definition for “sustainability,” grounding the public charity’s next steps on its multifaceted Sustainability Road Map project. IFEEDER defined “sustainability” for the U.S. animal food industry as “defined and managed by each individual organization to deliver measurable, continuous improvements on the impacts related to people, planet and governance that are most important to them and their stakeholders.” Lara Moody, IFEEDER executive director, says, “We have provided an ‘on ramp’ for the industry to help achieve leadership buy-in and employee engagement so that sustainability becomes part of their corporate cultures and shapes future business decisions.” The toolkit materials, which are supported by 18 months of research and development, are grouped into three stages: people, planet and governance. The toolkit is free for AFIA members and IFEEDER donors at ifeeder.org.

New Guide Helps Farms, Rural Small Businesses Go Solar

Solar United Neighbors Tuesday released a new guide to help farmers and rural small business owners apply for a key federal grant and loan. The guide will make it easier for rural Americans to install solar energy at their property. The comprehensive guide takes applicants step-by-step through the Rural Energy for America Program, or REAP, application process. The REAP program has been so popular that funding for the grants has not been able to meet the demand. The Inflation Reduction Act, passed last year, quadrupled REAP funding over the next ten years. Farmers and rural small business owners can receive loan guarantees of up to 75 percent of total eligible project costs through REAP. They can receive grants for up to 40 percent of the total project cost. Solar United Neighbors is hosting a free webinar February 2 to educate attendees about the REAP program and what steps they need to take to apply. Learn more at solarunitedneighbors.org.

Wednesday Watch List

Markets

The Bank of Canada is expected to raise its interest rate by a quarter-percent early Wednesday, a prelude to a rate hike, expected from the Federal Reserve on February 1. The U.S. Energy Department's weekly report of energy inventories is set for 9:30 a.m. CST, including ethanol production. Traders continue to keep tabs on the latest weather forecasts and will watch for a possible export sale announcement at 8 a.m.

Weather

A strong storm system that brought widespread precipitation to the Southern Plains on Tuesday continues toward the Northeast on Wednesday. A band of moderate to heavy snow has developed on the north side of the track, along and north of the Ohio River, while a line of showers and thunderstorms will move through the Southeast, some of which may be severe. Winds in the Southeast are fairly strong as well with gusts increasing into the 35-45 mph range in some areas.

USDA Announces Additional Assistance for Dairy Farmers

The USDA announced additional assistance for U.S. dairy producers, including a second round of payments through the Pandemic Market Volatility Assistance Program. The agency also announced a new Organic Dairy Marketing Assistance Program. The moves will help USDA better support small- and medium-sized dairy operations that weathered COVID and now face other challenges. “USDA is announcing a second set of payments totaling almost $100 million to close out the $350 million commitment under the pandemic assistance program,” says USDA Undersecretary for Marketing and Regulatory Programs Jenny Moffitt. “The funds will be released through partnerships with dairy handlers and cooperatives to deliver the payments.” USDA will also be releasing new assistance targeted to small- and medium-sized organic dairy farmers. The goal will be to help those producers with anticipated marketing costs as they face a variety of challenges from weather to supply-chain challenges. For more information on USDA assistance, go to farmers.gov.

USDA Accepting Applications for Netherlands Trade Mission

The USDA’s Foreign Agriculture Service is accepting applications from U.S. exporters for its first-ever agricultural trade mission to Amsterdam, Netherlands, April 17-20. “Agribusiness producers, exporters, and growers in the U.S. may find the Netherlands to be a perfect gateway into Europe,” says FAS Administrator Daniel Whitley. “Participants will explore exporting opportunities in this mature market, which continues to grow, and meet potential buyers in surrounding regional markets.” U.S. ag and related exports to the Netherlands reached $3.4 billion in 2021, making it the tenth-largest global market. During the trade mission, U.S. participants will meet with buyers from the Netherlands, Iceland, Norway, Sweden, Finland, Denmark, Belgium, and Germany. For companies interested in expanding sales in the Netherlands and the other markets, export opportunities include oilseeds, fats, vegetables, oils, grains, pulses, and many other exports. The deadline to apply for the Netherlands trade mission is Thursday, January 26. For information, go to fas.usda.gov.

Alltech Shares Global Feed Production Survey

Alltech released its 2023 Agri-Food Outlook today, highlighting global feed production survey data. Despite significant challenges that hit the entire supply chain, global feed production remained steady in 2022 at 1.266 billion metric tons. That’s a decrease of only one-half of one percent from 2021’s estimates. The top feed-producing countries during the past year were China at number one with 260.7 million metric tons, the U.S. in second at 240.4 MMT, and Brazil a distant third with 81.9 million. Together, the top ten feed-producing countries produced 64 percent of the total world production. Half the world’s feed consumption is concentrated in four areas, including China, the U.S., Brazil, and India. Vietnam jumped ahead of Argentina and Germany into the top ten in feed tonnage. Russia overtook Spain, which reported a significant reduction in feed production. Feed production increased in several regions, including Latin America, North America, and the Oceania countries.

Farm Futures 2023 Planting Survey Results

A survey from Farm Futures shows the 2023 acreage battle is ongoing. However, there could be a surprise when it comes to the total number of corn and soybean acres. A surge in projected wheat acres and costly inputs will likely limit any expansion of corn and soybean acres. About 70 percent of the respondents said they were locked in on 2023 acreage decisions by late December. Farm Futures says corn and soybean plantings will increase only minimally compared to past projections due in large part to shrinking profit margins for both corn and soybeans. The survey shows that 90.5 million acres of corn and 88.9 million acres of soybeans will get planted in the spring. Soaring costs of inputs likely mean more wheat acres as wheat typically requires less nitrogen. Anhydrous ammonia retailed for about $1,400 per ton last fall, so many farmers opted for less nitrogen-intensive crops for 2023 plantings.

Argentina Rain Forecast too Late to Save Crops

Hot and dry weather continues to damage crops in Argentina and southern Brazil. Last week was the third-hottest and the overall driest third week in January in more than 30 years for the main soybean-growing regions in Argentina. The drought stress has combined with extremely hot temperatures to significantly drop the expected corn and soybean yields in Argentina. Agriculture Dot Com says more rain is in the forecast during the coming weeks, but the bad news is that the rains are too late to help crops. Brazil saw near-normal precipitation during the last week in Mato Grosso, the top-producing state in Brazil. However, hot and dry conditions continue to damage expected yields in southern Brazil. Dryness is expected to stick around in southern Brazil, and this week may become one of the hottest and driest weeks in more than 30 years in Rio Grande do Sul near the southern border.

U.S. Cattle on Feed Down Three Percent

Cattle and calves on feed for the slaughter market in the U.S. for feedlots with a capacity of 1,000 or more head totaled 11.7 million on January 1. The inventory was three percent below January 1 of last year. That inventory included 7.03 million steers and steer calves, down four percent from the previous year. That group accounted for 60 percent of the total inventory. Heifers and heifer calves accounted for 4.65 million head, down one percent from 2022. Placements in feedlots during December totaled 1.8 million head, eight percent below 2021. Net placements were 1.75 million head. During December, placements of cattle and calves under 600 pounds were 435,000 head, 600-699 pounds were 435,000, 700-799 hit 415,000 head, and 800-899 pounds were 304,000 head. Marketings of fed cattle during December totaled 1.74 million head, six percent below last year. Other disappearances totaled 54,000 head in December, unchanged from 2021.

Tuesday Watch List

Markets

There are no significant reports on Tuesday's docket, but judging from Monday's selling in grains, traders will remain focused on the latest weather reports and forecasts. Traders will also pause at 8 a.m. CST to see if USDA has another export sale to report after announcing 7.1 million bushels of soybeans to unknown destinations Monday. Outside markets may be an influence Tuesday with several big names expecting earning reports.

Weather

A strong storm is developing over Texas on Tuesday and will press northeast through Tuesday night, headed toward Memphis by early Wednesday morning. A batch of scattered showers and thunderstorms is developing with the system, including some moderate to heavy snow across the Texas Panhandle. That snow will extend up through Missouri later in the day and set up along and north of the Ohio River tonight. To the south, thunderstorms will produce moderate to heavy rain and have some potential for severe weather close to the Gulf of Mexico.

Farm Group Wants Investigation Into Egg Prices

A U.S. farm group is asking the Federal Trade Commission to look into the high prices of eggs and possible price gouging. Farm Action is a farmer-led advocacy organization that sent a letter to FTC Chair Lina Khan to share their concerns over “apparent price gouging.” They point out that Americans are paying more than ever for an important household staple. The USDA says a recent record outbreak of highly pathogenic avian influenza is the reason for the high prices. The group says the nation’s top antitrust regulator must look into the record-high profits of the nation’s top egg company. Cal-Maine Foods controls 20 percent of the retail egg market and reported a quarterly sales increase of 110 percent. Gross profits are 600 percent higher than the same time last year. The company says avian flu is driving up prices. However, Cal-Maine had no positive flu tests on any of its farms.

CoBank: Dairy Industry Eager for FMMO Reform

America’s dairy producers and processors are closely watching discussions about the next farm bill and looking for reforms to Federal Milk Marketing Orders. CoBank says the industry feels that current FMMOs don’t reflect today’s market environment, and the consequences could be drastic. Make allowances are an important part of the orders that haven’t been updated since 2008 and were based on data from as far back as 2006. Make allowances estimate dairy processors’ costs of converting milk into dairy products. Many of those production costs, including labor and energy, have risen dramatically since make allowances were updated 15 years ago. While the current make allowances have stayed the same since 2008, prices for industrial power rose 64 percent, and labor costs in dairy manufacturing climbed 48 percent. While industrial natural gas prices have fallen 11 percent, they’ve been highly volatile during that time. Failing to update them could hinder future dairy industry growth.

Fertilizer Institute Names 2023 4R Advocates

The Fertilizer Institute selected three farmers and their fertilizer retailers as 4R advocates. They’re being recognized for their commitment to implementing fertilizer management practices that incorporate the principles of 4R Nutrient Stewardship and have demonstrated economic and environmental benefits. Now in its 12th year, the 4R Advocate Program demonstrates the in-field successes of implementing 4R practices based on the right source, rate, time, and placement of fertilizer. “While 4R Nutrient Stewardship is a priority for the fertilizer industry, it’s also a tangible solution for thousands of farmers across America who are seeking fertilizer application practices that have a real-world impact on their bottom lines and their land,” says TFI president and CEO Corey Rosenbusch. The 2023 class of advocates represent 13,770 acres across three states and grow corn, soybeans, sugar beets, and other crops. In 2021, the fertilizer industry committed to putting 70 million acres of cropland under 4R management by 2030.  

Clean Fuels Conference Begins Monday

Clean Fuels Alliance America will kick off the Clean Fuels Conference on Monday, January 23 (today) at the Tampa Convention Center in Tampa, Florida. The event runs through Thursday and will likely draw more than 725 registered participants, including agricultural interests, clean fuel producers, marketers, end users, and more. It’s the 20th annual industry conference formerly known as the National Biodiesel Conference and Expo. This is the first-ever Clean Fuels Conference. “Companies know consumers want to feel better about their purchases,” says Clean Fuels CEO Donnell Rehagen. “Low-carbon transportation fuels in planes, trains, ships, and trucks will have to be the focus of their efforts.” The theme of this year’s conference is “United As One.” It’s designed to highlight the industry’s commitment to bringing together stakeholders to build a sustainable transportation future. The clean fuels industry set a goal of producing six billion gallons a year of sustainable fuels by 2030.

Lamb Board Releases New Strategic Plan

The American Lamb Board released its fiscal year 2022 Annual Report to inform Mandatory Lamb Checkoff stakeholders of its work to mitigate outside forces and challenges and take advantage of opportunities ahead. “Even though many challenges were out of our control, it’s critical that we keep driving forward as hard as we can to promote American lamb and the U.S. sheep industry,” says ALB chair Peter Camino. ALB has also identified three primary goals as it turns to FY 2023. The first is to continue to grow consumer demand for American lamb. The second is to prioritize research and education efforts to improve product quality and consistency, increase productivity, and grow the year-round supply of lamb. The board also wants to expand the awareness, understanding, engagement, and involvement of stakeholders in the American Lamb Checkoff. “As the American lamb industry looks to the future, there are several areas of opportunity,” Camino says.

2025 Dietary Guidelines Advisory Committee Announced

The USDA and the Department of Health and Humans Services announced the appointment of 20 nationally recognized scientists to serve on the 2025 Dietary Guidelines Advisory Committee. The Committee will review the current body of science on key nutrition topics and develop a scientific report that includes its independent assessment of the evidence and recommendations for USDA and HHS as they develop the Dietary Guidelines for Americans. The dietary guidelines serve as the foundation for national nutrition programs, standards, and education. In addition, they provide health professionals with guidance and resources to assist the public in choosing an overall healthy diet that works for them. “Diet-related diseases are on the rise across all age groups, and we must rise to the challenge by providing nutrition guidance that people from all walks of life can tailor to meet their needs,” says USDA Secretary Tom Vilsack. “This will help Americans achieve better nutritional habits.  

Monday Watch List

Markets

Back from the weekend, traders will check the latest weather forecasts, especially for Argentina where drought-stricken crops have increased chances for rain. Traders may pause at 8 a.m. CST to see if USDA has an export sale to announce and will check USDA's weekly report of export inspections at 10 a.m.

Weather

Another strong storm system is moving through the Four Corners area early Monday morning. That system will move into Texas tonight and head through the Northeast for Tuesday and Wednesday. Widespread precipitation will occur in Texas and Oklahoma tonight, including some moderate to heavy snow.

Top 5 Things to Watch - Key Happenings the Newsroom is Tracking for the Week of Jan. 22-28

1. Altered reality of wheat. As DTN Lead Analyst Todd Hultman discussed in Friday's Todd's Take, there's a growing disconnect between supply and demand forces and the actual price of wheat. With continued low soil moisture in major parts of the U.S. breadbasket, continued war in the Black Sea area, and already low wheat stocks, Hultman expects current $7-$8 cash wheat prices (based on DTN's national cash index) to get a reality check at some point. 

2. Clipper blockers hang in there, for now. Our weather team is watching two trough systems work their way through Texas to the Northeast, bringing additional moisture to the central and eastern portions of the country. Depending on where your farm is, the first of those systems might be there as you read this. The second should be right behind it early in the week. Both include a band of snow, so winter is far from gone. But for some time now frigid cold weather has been absent. Unfortunately, chances for the next arctic blast will probably come late next week as the pattern allows cold air to come down from Canada. 

3. Fueling around: Deep winter can be time to refill fuel tanks drained by the last of harvest, but global diesel market conditions have put the squeeze on those plans. DTN Ag Business Editor Katie Dehlinger will gather the latest experts' thoughts on near- to medium-term fuel prices. Watch for her story by mid-week.

4. Laws and orders: We'll be watching a number of courtroom-related actions this week. These include the latest on a number of suits filed against the EPA over waters of the United States (WOTUS) regulations. The meat packing industry also will likely be in the courtroom news. Watch for stories on the complaint filed with the Securities and Exchange Commission that meat packer JBS isn't meeting carbon emissions goals.

We'll also be looking into the recent mass of advertisements on social media platforms for cattlemen to join the price-fixing suits against Big Four meat packers. R-CALF USA filed the first suit in 2019, and the number of groups and food companies filing similar claims against the packers has grown in recent months. Along with that, advertisements from law firms offering to represent producers in any class action settlements are popping up like volunteer wheat after a grain cart spill. Legal experts say producers should not need representation; we'll get into the details.

5. Winter meetings pick up: We'll have DTN staff at several events this week. DTN Ag Policy Editor Chris Clayton will be in Kansas, looking in to the growing town versus farm water availability issues, and also attending the No-Till on The Plains Winter Conference, Jan. 23-25 in Wichita. Watch for his reporting from the Sunflower State. DTN Lead Analyst Todd Hultman will be at the Sioux Falls Farm Show in South Dakota, giving his latest market outlook on Jan. 25-27.

Groups File Legal Challenges to New WOTUS Rule

Groups representing agriculture, infrastructure, housing, and petroleum filed a legal challenge to the new Waters of the U.S. Rule. “The Biden Administration’s WOTUS definition is an attack on farmers and ranchers, and we’ll be fighting back in court,” says Mary-Thomas Hart, chief counsel for the National Cattlemen’s Beef Association. “The rule removes longstanding exclusions for small and isolated water features on farms and ranches and adds to the regulatory burden farmers already face.” Non-agriculture groups in the lawsuit include the American Petroleum Institute, the Associated General Contractors of America, and many others. “The new rule creates uncertainty for farmers and ranchers even if they’re miles from the nearest navigable water,” says Farm Bureau President Zippy Duvall. “We believe a judge will see these regulations exceed the scope of the Clean Water Act.” A Supreme Court decision in Sackett v. EPA could require the EPA to start over again on defining WOTUS.

Rebound Continues in Farm Lending

Farm lending activity continued to gradually increase along with further growth in loan sizes. The Kansas City Federal Reserve says the average size of non-real estate farm loans was about 20 percent higher than a year ago and drove an increase in lending volumes for the fourth straight quarter. Average interest rates on farm loans rose sharply alongside higher benchmark rates and reached a ten-year high, putting additional upward pressure on financing costs. The outlook for farm finances remained favorable alongside elevated commodity prices, but increased interest rates, challenging weather, and high production costs remain key concerns. Higher expenses contributed to a rebound in lending last year, but strong income and liquidity likely limited the financing needs of many producers. Looking ahead, elevated operating expenses could put additional upward pressure on loan demand. Lending activity was seven percent higher than last year. Production expenses have increased by 15 percent since 2020.  

NCBA Statement on USDA’s Proposed Traceability Rule

National Cattlemen’s Beef Association President-Elect Todd Wilkinson released a statement on the USDA’s proposed rule on electronic identification for transporting cattle over state lines. “As USDA has worked toward a nationally significant traceability program, NCBA has engaged with industry stakeholders and USDA to ensure that cattle producers are represented and protected,” says Wilkinson, who also chairs the NCBA Traceability Working Group. “Any program must allow maximum flexibility and privacy while minimizing costs for producers and any industry disruptions.” NCBA also says foot-and-mouth disease outbreaks around the world continue to result in disruptions to commerce and depopulate livestock. That means immediate action is needed. “NCBA is committed to working with USDA to ensure workable solutions are identified and implemented,” Wilkinson says. The organization also says that cattle producers can be confident that any finished product will protect the nation’s livestock herd. The NCBA is continuing to review the proposed rule in its entirety.

USDA Investing Funds to Reduce Wildfire Risk

Ag Secretary Tom Vilsack announced his agency is expanding efforts to reduce the risk of wildfires in the western U.S. Funds will be invested to directly protect at-risk communities and critical infrastructure in 11 additional landscapes in Arizona, California, Idaho, Nevada, Oregon, Utah, and Washington. “It’s no longer a matter of if a wildfire will threaten many western communities, it’s a matter of when,” Vilsack says. “This announcement means over $490 million will be used to restore national forests, including the restoration of resilient old-growth forest conditions.” The Forest Service announced its original ten landscape project areas last year. Combined with the additional announcement this week, that represents a total USDA investment of $930 million across 45 million acres. The work spans 134 of the 250 highest-risk fire sheds identified in the Wildfire Crisis Strategy and will mitigate the wildfire risk for around 200 communities in the western United States.

January Beige Book Contains Observations on the Ag Economy

The Federal Reserve Board released its January 2023 Beige Book Update, which summarizes current economic conditions in each district. The summary includes agricultural conditions in several districts. The Fed in Atlanta said ag conditions were little changed from the previous report but did note Florida citrus yields were down notably due to Hurricane Ian. The Chicago Fed says after a strong year in the district, agricultural income will be lower in 2023 but still see solid returns. The St. Louis branch says inflation-adjusted farm incomes are near a 50-year high and leading to optimism for this year despite rising input costs. The Minneapolis Fed says ag conditions were stable as farm incomes and working capital remained strong heading into this year. Ag conditions in the San Francisco district remained in generally weak condition. Dollar sales were up but down in volume. Rainfall continued to improve soil moisture in the Dallas Fed’s district.  

Avoiding Antibiotic Resistance on the Dairy Farm

Antibiotic use in dairy animals is just to help the animal overcome illness. Mark van der List, a vet with Boehringer-Ingelheim, says the challenge is to help them overcome the sickness without furthering resistance and allowing antibiotic residue into food products. He says it’s important to work with a veterinarian who knows your herd as well as they do. Other tips include following label directions carefully. Producers need to mark and separate all treated animals. Every employee should be easily able to identify any treated animals. Make sure to keep detailed records of all treatments given to each animal in the herd. It’s also important to remove all doubt by making the protocol for treating animals as airtight as possible. “Dairy producers take the responsibility for antibiotic stewardship seriously,” van der List says. “While many already have strong measures in place, it’s always a good idea to fine-tune existing protocols.”

Friday Watch List

Markets

USDA's weekly export sales report is due out at 7:30 a.m. CST, followed by U.S. existing home sales for December at 9 a.m. and USDA's cattle on-feed report for January 1 at 2 p.m. Traders continue to closely watch the latest weather forecasts, especially for Argentina where crop ratings fell even lower Thursday. The market will also check for a possible export sale announcement from USDA at 8 a.m.

Weather

As a system continues to push off the East Coast early Friday, some lake-effect snows will continue over the Great Lakes throughout the day. Another system is working its way through the Four Corners area and will move out into Texas tonight and Saturday. In response, widespread precipitation is expected to develop, including a band of moderate to heavy snow across Colorado and Kansas, bringing in much-need moisture for the longstanding drought. Mild temperatures continue across most areas east of the Rockies.

USDA Seeks Comment on Proposal to Strengthen Animal Disease Traceability

USDA's Animal and Plant Health Inspection Service proposes to amend animal disease traceability regulations and require electronic identification for interstate movement of certain cattle and bison. APHIS is also proposing to revise and clarify record requirements. The changes would strengthen the Nation's ability to quickly respond to significant animal disease outbreaks, according to USDA. Animal disease traceability, or knowing where diseased and at-risk animals are, where they've been, and when, is important to ensuring a rapid response when animal disease events occur. Rapid traceability in a disease outbreak could help ranchers and farmers return to selling their products more quickly, limit how long farms are quarantined, and keep more animals from getting sick. The proposed rule would require official eartags to be visually and electronically readable for official use for interstate movement of certain cattle and bison. A comment period on the proposal through the Federal Register is open through March 22, 2023.

USDA Publishes Strengthening Organic Enforcement Final Rule

USDA’s National Organic Program Wednesday published the Strengthening Organic Enforcement final rule. The update to USDA organic regulations strengthens oversight and enforcement of the production, handling, and sale of organic products. The final rule implements 2018 Farm Bill mandates, responds to industry requests for updates to the USDA organic regulations, and addresses National Organic Standards Board recommendations. USDA Undersecretary for Marketing and Regulatory Programs, Jenny Lester Moffitt, says, "Protecting and growing the organic sector and the trusted USDA organic seal is a key part of the USDA Food Systems Transformation initiative." The Strengthening Organic Enforcement rule is the biggest update to the organic regulations since the original Act in 1990, providing a significant increase in oversight and enforcement authority to reinforce the trust of consumers, farmers, and those transitioning to organic production, according to USDA. Organic stakeholders affected by the rule will have one year from the effective date of the rule to comply with the changes.

EPA Posts Revised WOTUS to Federal Register

The Environmental Protection Agency and Army Corps of Engineers published the revised Waters of the U.S. rule in the Federal Register Wednesday. The publication means the revised rule will go into effect on March 20, 2023. EPA and the Army Corps announced the rule at the end of 2022, which will replace the Navigable Waters Protection Rule. At the time, American Farm Bureau Federation President Zippy Duvall commented, “EPA has doubled down on the old significant nexus test, creating more complicated regulations that will impose a quagmire of regulatory uncertainty.” The rule comes as agriculture awaits a Supreme Court decision in the Sacketts vs. EPA case, which could send WOTUS back to the drawing board. However, the Sackett case is not focused on the new rule. AFBF General Counsel Travis Cushman says, “you would probably need to have a new challenge to that rule," based on the Sackett Supreme Court decision.

December Producer Price Index Declines

The Producer Price Index for final demand declined 0.5 percent in December, seasonally adjusted, the U.S. Bureau of Labor Statistics reported Wednesday. The index measures the average change over time in the selling prices received by domestic producers for their output. Final demand prices advanced 0.2 percent in November and 0.4 percent in October. The index for final demand increased 6.2 percent in 2022 after rising 10.0 percent in 2021. Prices for final demand less foods, energy, and trade services edged up 0.1 percent in December, up 4.6 percent in 2022, following a seven percent rise in 2021. Nearly half of the December decrease for final demand goods can be traced to a 13.4-percent decline in prices for gasoline. The indexes for diesel fuel, jet fuel, fresh and dry vegetables, canned, cooked, smoked, or prepared poultry, and basic organic chemicals also fell. In contrast, prices for carbon steel scrap increased 8.3 percent. The indexes for chicken eggs and for electric power also moved higher.

Horticultural Products Drive Total U.S. Agricultural Import Growth

The value of U.S. agricultural imports grew an average of four percent a year between fiscal years 2012 and 2022, according to USDA’s Economic Research Service. Total U.S. agricultural imports rose from $139 billion to $194 billion, with growth concentrated in select commodity groups. Horticultural products grew at a rate of six percent a year and, at $97.2 billion in value in 2022, accounted for 65 percent of the total growth in imports. Within the horticultural group, fresh fruits were the largest contributor at $17.9 billion, growing at an annual rate of nine percent over the period and accounting for 15 percent of total import growth. Key commodities in the fresh fruit group include avocados, berries, and citrus, which the United States imports mostly from Latin American countries. Demand for horticultural products has largely been driven by consumer desire for year-round supply, changing consumer preferences, and foreign production that is increasingly competitive with domestically grown produce.

IDFA Names Mike Brown as Chief Economist

The International Dairy Foods Association this week named Mike Brown as chief economist. Brown has a long and distinguished career in the dairy industry, most recently leading the milk and dairy procurement team for The Kroger Co. as director of dairy supply chain. Brown is a recognized expert on milk pricing policy and has worked for both farmer-owned cooperatives and proprietary businesses, all of which are current IDFA members. IDFA President and CEO Michael Dykes says, “We are confident that with Mike Brown as IDFA’s chief economist, our approach to the future will ensure the domestic and global competitiveness of the U.S. industry.” IDFA also announced that it has engaged in consulting agreements with three policy and legal experts to support dairy policy and pricing efforts led by Carlin and Brown. They are Chip English, Steven J. Rosenbaum, and former U.S. Representative Collin Peterson. The additions come as the dairy industry expects a Federal Milk Marketing Order reform effort this year.

Thursday Watch List

Markets

U.S. weekly jobless claims, December U.S. housing starts and an update of the U.S. Drought Monitor will all be out at 7:30 a.m. CST Thursday. The U.S. Energy Department's natural gas storage report will attract interest at 9:30 a.m., now that gas prices are near $3.00 and will be followed by weekly energy inventories, including ethanol production at 10 a.m. USDA's monthly Livestock, Dairy and Poultry outlook is set for 2 p.m.

Weather

A strong winter storm that brought heavy snow to portions of the Central Plains and Midwest and heavy rain farther south continues east on Thursday, with more of the precipitation focused on the Midwest into the Northeast going into Friday. Another system is moving through the West, which will emerge in the Southern Plains on Friday. Even behind the current system, temperatures for most areas are above normal for this time of year.

US, EU Sign Tariff Rate Quota Agreement

U.S. and European Union trade leaders Tuesday signed the U.S. – EU Tariff Rate Quota Agreement. The agreement, once implemented, will enable the United States to preserve its existing access to the EU market for various agricultural commodities following the United Kingdom's exit from the EU on January 1, 2021. The new Tariff Rate Quota allocations are based on the historic pattern of agricultural exports to the 27 European Union Member States. The agreement will restore favorable market access for multiple U.S. agricultural products, including for U.S. rice, almonds, wheat, and corn, according to the U.S. Trade Representative's Office. In the first eleven months of 2022, the United States exported $11.1 billion worth of agricultural goods to the European Union. Trade Representative Katherine Tai, Sweden's Permanent Representative to the European Union, Ambassador Mikael Lindvall, and European Commission Deputy Director General for Agriculture and Rural Development, Michael Scannell, signed the agreement.

House Ag Committee Republicans Set Roster

House Agriculture Committee Republicans started the week by announcing the committee’s Roster for the 118th Congress. Glenn GT Thompson of Pennsylvania serves as the chair of the committee. The roster features 12 new members, which includes returning member Frank Lucas of Oklahoma. Lucas previously chaired the committee from 2011 – 2015. Lucas led the committee during the development of the 2014 Farm Bill. Other notable new members include John Duarte of California and Mark Alford of Missouri. Duarte was the subject of a high-profile lawsuit filed by the Environmental Protection Agency under the Clean Water Act. The dispute ended in 2017 with Duarte agreeing to pay a civil penalty and preserve and restore streams and wetlands on his farm. Alford, a new member of Congress, ended a career as a Kansas City area news anchor to run for Congress. Additionally, 15 members return to the committee after serving in the previous Congress.

NASDA Sets 2023 Policy Priorities

Press The National Association of State Departments of Agriculture Tuesday announced the organization’s primary policy focus for 2023. NASDA members, the state commissioners, secretaries and directors of agriculture, hand-selected seven issues to focus on. The issues include the 2023 Farm Bill, which NASDA says must remain unified, securing a commitment to American agriculture and the critical food and nutritional assistance programs for those who need it most. As for environmental regulations, NASDA supports the science-based and comprehensive regulatory framework the Federal Insecticide, Fungicide, and Rodenticide Act provides to ensure environmental and public health protection. Regarding the recently published “waters of the U.S.” rule, NASDA will continue to impress the role of states in regulating non-navigable waters. Other priorities include food production and the supply chain, food safety, animal health, international trade and workforce development. NASDA CEO Ted McKinney says, “We believe these are the areas where state departments of agriculture are uniquely positioned to lead impact and direct policymaking solutions this year.”

Rural Job Growth Shifting to High-skill Workers

Over the last two decades, the strongest rural job gains were in smaller industries that tend to employ high-skill workers. USDA Economic Research Service reports the highest growth was in the real estate industry. Also showing rapid growth was the administrative services industry, which includes office administration, facilities support, business support services, security services, conventions and trade shows, and waste management and treatment. Other rural industries that grew over the past two decades were health care and social assistance; professional, scientific, and technical services; educational services; and finance and insurance. The growth of these industries represented a shift in rural production toward industries that employ higher shares of high-skill workers. Consistent with this shift, the percent of rural college-educated workers increased from 21.5 percent in 2012 to 23.8 percent in 2019. However, these rates have remained lower than the share of college-educated urban workers, at 38 percent in 2019.

House Ag Chair to Keynote Plant Based Product Council Conference

House Agriculture Chairman Glenn GT Thompson will keynote the inaugural Plant Based Products Council Annual Conference in March. The Pennsylvania Republican will share remarks on Congress’ priorities for the 2023 Farm Bill, growing the bioeconomy, rural economic development, and fostering innovation in agriculture. PBPC Executive Director Jessica Bowman says, “We are excited to convene Chairman Thompson and other policy and industry leaders to drive this industry forward.” PBPC2023 will take place at the JW Marriott in Washington, D.C., from Monday, March 27, to Wednesday, March 29, 2023. The association's inaugural conference will explore the innovations, business models, and policies influencing the entire lifecycle of bioproducts in support of a robust circular economy. Attendees will hear from and network with industry leaders, policymakers, brands, and experts through panels, keynotes, networking sessions, and more. Learn more about the Plant Based Products Council and its inaugural annual conference at www.pbpc.com.

USDA Introduces an E-Application for the 1890 National Scholars Program

The Department of Agriculture Tuesday unveiled a new e-application for the USDA/1890 National Scholars Program. The program aims to encourage students at 1890s institutions to pursue food and agriculture career paths. For the first time, the new e-application for the USDA/1890 National Scholars Program allows young people around the country to complete and submit their applications online. The program is administered through USDA’s Office of Partnerships and Public Engagement. The USDA/1890 National Scholars Program is a partnership between USDA and the country’s 19 historically Black land-grant universities that were established in 1890. USDA partners with these 1890 universities to provide scholarship recipients with full tuition, fees, books, room, and board. Scholarship recipients attend one of the 1890 land-grant universities, and pursue degrees in agriculture, food, natural resource sciences, or related academic disciplines. The scholarship also includes work experience at USDA. The application deadline is Wednesday, March 15, 2023. For more information, contact 1890init@usda.gov.

Wednesday Watch List

Markets

A report on U.S. retail sales for December is due out at 7:30 a.m. CST, followed by December U.S. industrial production at 8:15 a.m. The Federal Reserve's monthly Beige Book is set for release at 1 p.m. and weekly energy inventories are pushed to Thursday morning, due the the holiday schedule. Traders will keep close watch on the latest weather forecasts, especially for South America, and for any news of an export sale.

Weather

A storm system that has moved into western Kansas is producing a band of heavy snow across portions of Colorado and Nebraska early Wednesday morning, along with scattered showers farther south and across Missouri and Arkansas along and ahead of a cold front. The heavy snow will spread northeast throughout the day and night, through Iowa, southern Minnesota, and Wisconsin. Heavy snowfall amounts of 6-12" are expected in this band, with potential for some heavier amounts in some places. Farther south along the cold front, severe weather will be possible, most likely this afternoon near the Lower Mississippi River Valley.

NASDA Conducts Vietnam Trade Mission

National Association of State Departments of Agriculture members and leadership traveled to Vietnam last week. The delegation embarked on the organization's first trade mission to explore global emerging markets through the Department of Agriculture Emerging Markets Program. NASDA President and Wyoming Department of Agriculture Director Doug Miyamoto, Washington State Department of Agriculture Director Derek Sandison, Delaware Secretary of Agriculture Michael Scuse, Texas Department of Agriculture Assistant Commissioner Dan Hunter and NASDA CEO Ted McKinney participated in the mission. The delegation explored trading opportunities and educated Vietnamese agricultural, government and business leaders on American agriculture and markets. NASDA was recently awarded $925,000 from USDA to promote exports of U.S. agricultural products to developing countries with strong growth potential, including Vietnam. NASDA will also conduct trade missions to Thailand, Indonesia and Kenya in 2023. NASDA is a nonpartisan, nonprofit association that represents the elected and appointed commissioners, secretaries and directors of the departments of agriculture in all 50 states and four U.S. territories

Grassley Intends to Reintroduce Farm Credit for Americans Act

Senator Chuck Grassley last week announced he intends to reintroduce the Farm Credit for Americans Act. The legislation bans the federal government from allowing foreign individuals to obtain credit and financial services through the Farm Credit System. The Iowa Republican wrote the legislation with Senator Sherrod Brown, an Ohio Democrat. Specifically, the legislation prevents the Farm Credit Administration from underwriting foreign buyers seeking to purchase U.S. farmland. It would amend the 1971 Farm Credit Act to ensure foreign nationals can’t obtain financing through federal government-backed financial institutions to purchase American farmland. Grassley says, “Young and beginning farmers here at home should not be squeezed out or compete with foreign investors subsidized by the American taxpayer.” According to the USDA, foreign ownership of U.S. farm acres increased 60 percent between 2009 and 2019. Increasingly, young and beginning farmers are competing with institutional investors, such as pension funds, endowments and even professional athletes who are diversifying their financial portfolios with prime farmland.

RMA to Host Crop Insurance Workshop for Specialty Crops, Organics

Farmers in Iowa can attend a USDA's Risk Management Agency workshop to learn more about crop insurance options, including those designed for agricultural producers who grow specialty and organic crops. RMA will host the free in-person workshops Tuesday, January 24, in Davenport, Iowa. A morning and afternoon session is scheduled, and both have virtual options for producers outside the state or those who can't make it to the in-person event. The workshops will cover the ins and outs of the Whole-Farm Revenue Protection and Micro Farm programs, which are great insurance options for specialty crop, organic, urban, and other producers with diverse operations. RMA subject matter experts will provide an in-depth look at these policies. The events will include RMA Administrator Marcia Bunger and other RMA experts. Participants will have the opportunity to ask questions and get answers in real-time. The Risk Management Agency will hold another round of workshops next month in Michigan.

CHS Inc. and Cargill to expand TEMCO operations to include the Texas Gulf

CHS Inc. and Cargill recently announced the intent to expand the scope of their joint venture, TEMCO LLC, by adding the Cargill-owned export grain terminal in Houston, Texas. The addition of the Houston terminal will expand the joint venture's export capabilities, providing shipping access for grains, oilseeds and byproducts through the port of Houston. TEMCO currently operates three facilities in the Pacific Northwest. The three facilities distribute grain to global markets, primarily located in the Asia-Pacific region. Through TEMCO, both companies look forward to building on 24 years of successful partnership to expand global grain market access for U.S. farmers to help meet the increasing global need for food. The Houston terminal is located approximately 40 miles inland from the Gulf of Mexico via Galveston Bay. With six million bushels of storage and capacity for 350 rail cars, the facility handles up to 250 million bushels annually. The terminal receives both trucks and railcars with a variety of commodities for global export.

Smithfield Foods Donates 35,000 Pounds of Food to Support Kentucky

Smithfield Foods, Inc. has donated 35,000 pounds of food, equal to 140,000 servings, to help feed victims of the severe winter weather that recently engulfed Eastern Kentucky. Smithfield delivered the food products to Mercy Chefs, which is currently stationed in Hazel Green, Kentucky, to provide disaster relief for local residents. The Portsmouth, Virginia-based nonprofit travels to disaster zones across the U.S. to serve free chef-prepared, restaurant-quality hot meals to local residents, volunteers and first responders. Smithfield products donated to this relief effort include lunch meat, bacon, fully cooked boneless ham, hickory smoked ham and smoked spiral sliced ham. The extreme winter weather in Eastern Kentucky left many residents with frozen pipes and entire towns without potable water. Mercy Chefs expects to cook 2,000-3,000 hot meals per day for residents in the area. To make a donation or find out how to volunteer locally, visit MercyChefs.com/easternky. 

Cumberland Introduces Scout Robot

Cumberland, AGCO’s poultry production equipment brand, is introducing Scout, the world’s first ceiling-suspended robot system. The system continuously monitors broiler chickens and their poultry house environments to increase animal welfare as well as farm productivity. Scott Becker, director of North America sales for Cumberland, says, “With Scout, producers can achieve better feed conversion, early disease detection and fine-tuning of climate control, resulting in reduced mortality and less condemnation numbers.” The advanced robot uses a complete set of sensors to map key indicators that impact bird health and performance, including thermal comfort, air quality, light intensity, sound levels and bird distribution. Scout also classifies excrement for early disease detection 24 to 48 hours before producers may become aware of an issue. In addition, the technology identifies dead birds. Monitoring information is available to producers 24/7 from any device, including daily and weekly reports with maps of their entire house.

Tuesday Watch List

Markets

Back from a three-day weekend, traders may still be pondering the many new estimates USDA set out last Thursday. News over the weekend and the latest weather forecasts, especially anything pertaining to South America, will be reviewed. There are no significant reports on Tuesday's docket other than USDA's weekly grain export inspections at 10 a.m. CST.

Weather

A system was moving through the Great Lakes early Tuesday with scattered showers arcing through the Mid-Atlantic and Southeast as well. This system continues to push east throughout the day. Another will be right on its heels as it moves from the Four Corners into the Central Plains tonight. A band of heavy snow is expected to develop over northeast Colorado through Nebraska and into the Upper Midwest tonight through Wednesday, along with scattered showers and thunderstorms for southwest Kansas down through west Texas. The precipitation over the southwestern Plains will be most welcome as the region remains in severe drought. It remains very warm across most of the country during the statistically coldest week of the year.

USDA Releases January WASDE Report

USDA released the latest World Agricultural Supply and Demand report Thursday. This month's U.S. corn outlook calls for reduced production, food, seed, and industrial use, feed and residual use, exports, and ending stocks. Corn production is estimated at 13.730 billion bushels, down 200 million. Exports were reduced 150 million bushels to 1.925 billion, reflecting the slow pace of shipments through December, and the lowest level of outstanding sales as of early January since the 2019/20 marketing year. The season-average corn price received by producers is unchanged at $6.70 per bushel. Soybean production is estimated at 4.276 billion bushels, down 69 million, led by reductions for Missouri, Indiana, Illinois, and Kansas. The soybean export forecast was reduced 55 million bushels to 2.0 billion. The U.S. season-average soybean price is projected at $14.20 per bushel, up 20 cents. The outlook this month calls for increased supplies, larger domestic use, unchanged exports, and lower ending stocks. The season-average farm price is unchanged at $9.10 per bushel.

Total Household Income up for Commercial Farms

From 2015 to 2021, the median total household income for commercial U.S. farms rose an estimated 16 percent, to $278,339 from $238,994. Commercial farms earn more than $350,000 gross cash farm income regardless of the principal operator’s occupation. USDA’s Economic Research Service reports that in 2021, the median total household income for commercial farms remained above the median income of $75,201 for all U.S. households. Farm households rely on a combination of on-farm and off-farm sources of income. On-farm income is determined by farm costs and returns that vary from year to year, and in any given year, a majority of farm households report negative farm income. Off-farm sources—including wages, nonfarm business earnings, dividends, and transfers—are the main contributor to household income for most farm households. Because households operating commercial farms rely mostly on on-farm sources of income, they experience the largest shocks in household income when farm sector income rises or falls.

USDA Accepting Applications for Netherlands Trade Mission

USDA’s Foreign Agricultural Service is accepting applications from U.S. exporters for its first-ever regional agricultural trade mission to Amsterdam, Netherlands, April 17 – 20, 2023. FAS Administrator Daniel Whitley says, “Participants will explore exporting opportunities in this mature market, which continues to grow, and meet potential buyers in surrounding regional markets.” U.S. agricultural and related exports, including fishery and forestry products, to the Netherlands totaled $3.4 billion in 2021, ranking it the U.S.’s 10th largest market globally. During the trade mission, U.S. participants will meet with buyers from the Netherlands, Iceland, Norway, Sweden, Finland, Denmark, and neighboring Belgium and Germany. Participants will conduct business-to-business meetings with potential buyers, receive market briefings from FAS and trade experts, and participate in site visits and other networking activities while in the Netherlands. The deadline to apply for the Netherlands trade mission is Thursday, January 26. Information about the trade mission and how to apply is available on the USDA FAS website.

USA Rice Calls House Ways and Means Chair Smith an Ally

Earlier this week, Representative Jason Smith was tapped to lead the powerful House Committee on Ways and Means. The Missouri Republican will lead the oldest committee in the U.S. Congress, which is the principal tax-writing body in the House of Representatives. The committee oversees not only taxes and revenue generation, but also tariffs and reciprocal trade agreements for the United States. USA Rice member and Missouri farmer Zach Worrell says, “Congressman Smith has long been a friend of Missouri agriculture and especially Missouri rice,” adding, “We are looking forward to having a rice industry ally lead this committee to advocate for U.S. rice on a global scale on the many trade issues we face.” Tax policy continues to be an important issue for rice farmers and rice-related businesses looking to pass operations onto the next generation. Smith is a farmer, businessman, and former state legislator, and is currently serving his sixth term representing Missouri’s 8th Congressional District.

Thank You Farmers Project Donations Surpass $4 Million

Culver's Thank You Farmers Project has now eclipsed $4 million raised since its creation in 2013. Through initiatives organized by Culver's on a systemwide level and the fundraising efforts of local restaurants throughout 2022, the program raised $750,000 toward its mission of advocating for the positive impact agriculture has on the world. Proceeds raised through the Thank You Farmers Project directly support those actively bringing positive change to the agriculture industry. These beneficiaries include groups making a difference with agriculture efforts in Culver's local communities as well as national organizations working to advance the industry on a broader scale, like the National FFA Organization and U.S. Farmers and Ranchers in Action. Alison Demmer, Culver's marketing and public relations manager, says, “We were so proud to see our guests join in this mission with us in 2022, and we look forward to supporting agriculture together through the Thank You Farmers Project long into the future."

Commodity Classic Registration Ends January 20

Only a few days remain to take advantage of early registration discounts for the 2023 Commodity Classic to be held March 9-11 in Orlando. Friday, January 20, 2023, is the last day the early registration discount will be in effect. Commodity Classic 2023 co-chair George Goblish says, “Going to Commodity Classic is an investment in any grower’s operation.” Registration fees vary depending on the number of days attended. Full registration covers all three days of the event, and one-day registrations are also available. Members of the National Corn Growers Association, American Soybean Association, National Sorghum Producers, National Association of Wheat Growers, and the Association of Equipment Manufacturers receive additional discounts on registration. All registration and housing reservations should be made online at CommodityClassic.com. The 2023 Commodity Classic will be held at the Orange County Convention Center West Concourse in Orlando, Florida. The convention center will house all Commodity Classic events.

Friday Watch List

Markets

On Friday the 13th, the University of Michigan's index of U.S. consumer sentiment is due out at 9 a.m. CST and several Federal Reserve officials are speaking around the country. Traders will keep tabs on the latest weather forecasts, especially in South America and will still be influenced by data from Thursday's USDA reports. January futures contracts in the soy complex are set to expire early Friday.

Weather

A system leaving the East Coast and another along the West Coast will produce scattered showers on Friday. Some relatively cold air moving over the Great Lakes will produce a bit of lake-effect snow as well. Temperatures remain mild for the coldest time of the year outside of the Southeast, even after a cold front moved through this week.

Equipment Sales Mixed in 2022

Combine harvester sales finished 2022 with healthy gains in unit sales while ag tractors finished below 2021 levels in both the U.S. and Canada. The Association of Equipment Manufacturers says total U.S. ag tractor unit sales fell during December and the whole year when compared with 2021. The sub-40 horsepower segment led losses in both time frames, losing 26 percent for the month and 19 percent for the calendar year. U.S. combine sales grew 16 percent in December and finished 2022 almost 16 percent higher than the previous year. Only one other segment was higher for the year, which was the 100-plus horsepower units, finishing the year up 11 percent despite dropping two percent in December. In Canada, combine harvesters led the yearly sales by finishing almost 11 percent higher than in 2021 and were assisted by a 27 percent sales bump in December. Tractor sales dropped seven percent in 2022.

AFBF Establishes 2023 Policy Priorities

Delegates at the American Farm Bureau Federation’s 104th annual convention adopted policies that will guide the organization’s work in 2023. Some of the key topics ranged from expanding risk management programs and improving dairy pricing transparency to battling hunger. “There’s a lot of work to do in 2023 as Congress drafts the next farm bill, and the policies set forth will guide AFBF as we work to ensure farmers and ranchers can continue to meet the growing needs of families in America and around the world,” says President Zippy Duvall. Delegates voted to modernize the farm bill by expanding baseline funding, developing more flexible disaster relief programs, and extending protection to more specialty crops. They also voted to bring more transparency to the federal milk pricing system. Voting delegates also formalized the organization’s opposition to the new Waters of the U.S. rule and a potential Mexican ban on GMO corn.

NACD Application Period for Conservation Grants

The National Association of Conservation Districts announced the open application period for the 2023 Urban and Community Conservation Grant Initiative. The grants are open to any conservation district or tribe within the U.S. and in the territories. Through a partnership with the Natural Resources Conservation Service, NACD has awarded over $6.5 million to 131 conservation districts and tribes in 37 states and Puerto Rico. As part of an ongoing effort to build capacity in the community-oriented agricultural space, NACD started offering UAC planning grants worth up to $10,000 each in 2022. The planning grants allow organizations that are new to urban or community agriculture to begin early-stage development of a program to provide conservation technical assistance. NACD will continue to offer the planning grants as well as the traditional implementation grants which are more focused on the provision of technical assistance. More information and the application are available at nacdnet.org.

USDA Expands Eligibility, Improves Benefits for Disaster Programs

USDA has made several updates to different conservation, livestock, and crop disaster assistance programs to give more farmers, ranchers, and tribes the opportunity to access them. Ease of access is especially important after natural disasters. The Farm Service Agency expanded eligibility and enhanced available benefits for a suite of its programs. The updates will provide critical assistance to producers who need to rebuild and recover after suffering catastrophic losses of production and infrastructure due to natural disasters. USDA updated the Emergency Conservation Program, the Emergency Assistance for Livestock, Honeybees, and Farm-raised Fish, the Livestock Forage Disaster Program, the Livestock Indemnity Program, and the Noninsured Crop Disaster Assistance Program. “As I meet with producers across the country, I’ve gained a better understanding of the ways in which our programs work and how they can be improved to better support all producers,” says Zach Ducheneaux, FSA Administrator. “Especially those who are rebuilding.”

CHS Reports First-Quarter Earnings

CHS released results for its first quarter which ended on November 30, 2022. The company reported a quarterly income of $782.6 million compared to $452 million in the first quarter of fiscal year 2022. First-quarter highlights from this year include revenues of $12.8 billion compared to $10.9 billion in the first quarter of fiscal year 2022, a year-over-year increase of 17 percent. Continued robust demand for commodities, coupled with market volatility, resulted in strong earnings across all of the company’s business segments. The company’s soybean and canola processing businesses in the Ag segment benefited from strong demand for meal and oil. “The U.S. agricultural industry has benefitted from ongoing strong global demand for grain and oilseed commodities,” says Jay Debertin, president and CEO of CHS. “Our continued strong earnings are attributable to market dynamics and supported by our investments on behalf of our owners that will drive efficiency and operational improvements.”

Pro Athletes Buying Iowa Farmland

Cincinnati Bengals quarterback Joe Burrow and longtime NBA player Blake Griffin are among some of the big-name athletes who are investing in Iowa farmland. They’ve joined up with more than 20 other pro athletes from the NFL, NHL, the NBA, and Major League Baseball to form an investment fund of about $5 million, which was used to buy farmland in Iowa. Other athletes in the group include Kemba Walker, formerly of the Dallas Mavericks of the NBA, and Khris Middleton of the defending NBA champion Milwaukee Bucks. The group is buying the land and will lease it to farmers who will work it and give the athletes a single-digit percentage annual return on their investment. It’s believed that the group will be looking to buy at least four more properties. They’ve already looked into several watermelon farms in Oregon that offer a higher per-acre rent than other larger farms.

Thursday Watch List

Markets

USDA's weekly export sales report is due out at 7:30 a.m. CST Thursday, the same time as weekly U.S. jobless claims, the December consumer price index and an update of the U.S. Drought Monitor. The Energy Department's weekly report of natural gas storage is set for 9:30 a.m., followed by USDA's Crop Production, WASDE, Grain Stocks and Winter Wheat Seedings reports -- all at 11 a.m. DTN's WASDE webinar follows at 12:30 p.m.

Weather

A system moving along or just north of the Ohio River on Thursday is producing thunderstorms along the river, some of which may be severe this morning. A larger threat for severe weather comes with thunderstorms developing over Mississippi that will move eastward through the rest of the day. Tornadoes and strong wind gusts are the main threats to the storms. Winds will be elevated around the system as well. More rain is moving through the West Coast, but most of California is getting a break from the recent heavy precipitation.