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READ the NAFB’s National Ag News for Friday, February 1st
USDA Backlog Delays Census of Agriculture Release
Politico says the month-plus government shutdown has left U.S. Department of Agriculture officials with quite the backlog of commodity reports. They also have a lot of other numbers waiting to be crunched for future reports. Those numbers include the 2017 Census of Agriculture, which is a major survey taken every five years and includes every state and county. It shapes a lot of future national policy and rural programs. The National Ag Statistics Service announced this week that the survey results won’t be released on February 21st as originally scheduled. However, the agency didn’t announce a new release date. The first of many delayed reports came out on Thursday, which covered agricultural prices. Reports covering peanut stocks and poultry slaughter will come out on Friday. The Foreign Agricultural Service also laid out a new release schedule for its backlog of weekly export sales announcements. The FAS reports got a lot of attention in December as China began to once again make large purchases of U.S. soybeans after Presidents Donald Trump and Xi Jinping reached a temporary truce at the G-20 summit in Buenos Aires.
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Outlook Seminar Expects Changing Weather, Strong Beef Prices
The first half of 2019 should see a shift away from current El Nino conditions. That prediction came from Dr. Art Douglas of Creighton University, who spoke during the CattleFax Outlook Seminar at the NCBA Cattle Industry Convention and Trade Show. Douglas says as the trend develops, it should allow the eastern third of the country to remain drier as the jet stream pushes Gulf moisture across the southern parts of the U.S. “After a cooler February, the U.S. will enjoy a relatively mild spring with a reduced threat of delayed planting,” Douglas told the crowd. As far as the markets go, CattleFax analyst Kevin Good says he is expecting prices to remain strong. “We’ve been on a good run for the past few years and I expect that to keep going in 2019,” Good says. “However, I do expect margins will begin to compress and leverage to shift from the cow-calf and stocker sectors over to the feeders as we expand the supply of cattle.” Price risk will remain in place over the next few years thanks to five years of expanding herds. “Cattle producers, on average, will receive a smaller percentage of the retail beef dollar as larger cattle supplies increase price pressure across all segments of the industry,” he says. “Retail beef prices will likely see some inflation in the year ahead.”
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U.S. Ethanol Exports Predicted to Hit 4 Billion Gallons by 2020
Mike Dwyer, Chief Economist for the U.S. Grains Council, made quite a prediction during a trade discussion at the Iowa Renewable Fuels Summit. He says U.S. ethanol exports have the potential to hit four billion gallons a year by 2020. If the American ethanol industry could export a total of four billion gallons in 2020, it would more than double the current record of 1.62 billion gallons that was set during the 2017-2018 marketing year that ended on August 31st, 2018. The Foreign Agricultural Service says U.S. ethanol was shipped to 74 countries during that time. Dwyer says the Grain Council’s global strategy does include selling ethanol to the Chinese despite the trade dispute between the two countries. China does have a 70 percent duty in place on U.S. ethanol imports. However, the country will have to figure out a way to import more foreign ethanol if the country aims to fulfill its mandate to use the E10 ethanol blend by 2020. Dwyer told Successful Farming that China could import approximately one billion gallons of ethanol to meet its mandate. If the trade issues between the U.S. and China get worked out, Dwyer says ethanol imports by China could hit 300 million gallons this year. Members of a Grains Council trade mission to China found out that Chinese gasoline retailers absolutely want to do business with the U.S. ethanol industry.
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Winterkill Likely Across Parts of Midwest Wheat Belt
The brutally cold conditions this week have been hard on farmers, their families, and all of their livestock. However, it’s also likely to be a rough go for southern parts of the Midwest wheat belt this week. Those arctic-level cold temperatures in the Midwest, combined with very thin or non-existent snow cover across south-central areas of the Midwest wheat belt, will likely lead to winterkill. The main areas that’ll be hit hardest include central Missouri, central Illinois, central Indiana, and central and southwestern Ohio. Temperatures likely hit -2 to -12 in those areas on Wednesday and Thursday morning,” says Don Keeney, Senior Ag Meteorologist with Radiant Solutions. “And when you combine that with very little snow cover, some damage is likely to wheat.” Keeney says areas across the far southern portions of the Midwest along the Ohio River should escape damage, as lows in those areas were expected to remain above winterkill thresholds. Snow cover should be deep enough to prevent major damage in other parts of the Midwest, where some actual lows dropped as far as -35 degrees. The good news is temperatures are expected to moderate considerably in the Midwest by this weekend, which should end any lingering threat of winterkill.
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Extreme Cold Impacting the Meat Supply Chain
The meat processing industry will likely come out of the extreme cold in the Midwest with nothing more than short-term supply disruptions. A Meating Place Dot Come article says those short-term delays will likely get made up quickly when the temperature begins to rise again. A Tyson Foods spokesman said on Wednesday that six of their plants in the Midwest didn’t operate that day. Tyson was concerned about the safety of both its workers and animals. A Hormel Foods supplier also closed up shop for the day due to the extreme cold. Production losses after those closures will likely be easily made up by implementing Saturday shifts. On the supply side of the business, cold temps mean the animals need to eat a lot more calories to put on weight. That means decreasing feed efficiency and may lead to lighter weight animals coming to market. The biggest impact on cattle on feed is as that feed goes toward maintenance rather than gain, that in turn makes it take a longer time on feed to get to eventual market weight.
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Bill Would Return Flavored, Non-Flavored Whole Milk Back to Schools
House Ag Committee Chair Collin Peterson of Minnesota and Glenn Thompson of Pennsylvania introduced a bill to allow flavored and unflavored whole milk to be offered in school cafeterias. Thompson says Ag Secretary Sonny Perdue directed USDA last year to allow schools to serve flavored one percent milk. HR Bill 832 would allow whole milk to be included as well. “Milk is the number one source of nine essential nutrients in the diets of our students,” Thompson says, “but if they don’t drink it, these health benefits will be lost.” The news release says milk consumption has been declining in schools throughout the nation because kids are not consuming the varieties of milk made available to them. Peterson says he’s proud to join Congressman Thompson in the effort that’ll provide more choices for nutritious and healthy milk to kids in schools, as well as a valuable market for dairy farmers in Minnesota, Pennsylvania, and nationwide at a time when those farmers face extremely difficult market conditions. Thompson says the 2010 Healthy, Hunger-Free Kids Act mandated that flavored milk within the program must be fat-free. Thompson says that law led to an alarming decline in milk consumption across American schools.
