READ the NAFB’s National Ag News for Wednesday, November 6th
Sponsored by the American Farm Bureau Federation
October Ag Economy Barometer Improves
The October Ag Economy Barometer improved to a reading of 136 in October, up 15 points compared to September. The monthly measure of the farm economy saw an increase in the assessment of current and future conditions by farmers. The Current Conditions Index rose from 100 in September to 115 in October, and the Futures Expectations Index also rose 15 points to a reading of 146. The results are based upon a nationwide telephone survey of 400 U.S. crop and livestock producers. Organizers say farmers in October were more inclined to think now is a good time to make large investments in their farming operations, and more farmers said they expect farmland values to rise, than in September. Although three-fourths of farmers in this month’s survey said they expect the soybean trade dispute with China to be resolved favorably to U.S. agriculture, 62 percent of producers said they expect to receive another round of trade aid payments for the 2020 crop year.
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China Urges Trump to Lift Tariffs
China wants the United States to commit to lifting tariffs to reach a phase one trade agreement. The South China Morning Post reports Beijing needs America to be more responsive to its concerns, if it wants Chinese President Xi Jinping (Shee Jihn’-ping) to visit the U.S. to sign the deal. There’s been no firm commitment by the U.S. to delay a December round of tariffs, and China also appears to want the U.S. to lift its recent round of tariffs from September. China says that without a move by President Donald Trump to make a “solid commitment” towards removing tariffs, scheduling a visit to the U.S. to sign the agreement “would be politically difficult.” U.S. officials have suggested they meet in Alaska, Iowa or Hawaii to sign the agreement. The two sides originally planned to sign the agreement on the sidelines of a now-canceled meeting in Chile. Sources close to the China talks say China fears it may have made too many concessions in the agreement.
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Rabo Releases Ten-year Grain Forecasts
A new grain price outlook underlines continuing long-term challenges for U.S. farmers. Rabo AgriFinance just released its ten-year outlook for corn, soybeans and wheat. The report says ending stocks will continue to be an issue for the crops, as the long-term trends for yield increases make up the difference in lower acre numbers while demand remains flat. The report says these stocks will keep a lid on commodity prices. Even if the U.S. and Chinese government’s resolve their trade dispute, Rabo expects soybean demand to drag due to the lingering effects of African swine fever, namely slow or limited sow herd rebuilding in China and Southeast Asia. The analysis shows a 75 percent probability that soybean prices will remain under $9.60 per bushel. For corn and wheat, the report says, “oversupply, flat domestic use, no or little growth in exports, and increased global trade competition” continue to pile up. Given no changes to ethanol policy, the outlooks call for animal feed to overtake ethanol as the demand driver for corn in 2026/27.
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Peterson: MFP Picks Winners and Losers
A recent letter to Agriculture Secretary Sonny Perdue says the current Market Facilitation Program creates “winners and losers among neighbors.” The Letter by House Agriculture Committee Chairman Collin Peterson urges the Department of Agriculture to strongly consider a list of concerns in issuing the next round of payments under the program. Peterson says acres not certified or enrolled in farm programs in 2018 are not eligible for the program, which is problematic for farms that recently changed hands where the previous owner didn’t participate in farm programs. Additionally, Peterson says crop rotations have prevented farmers from receiving payments, and the payments don’t account for the impact on crop basis created by trade disruptions. Regarding the MFP dairy program, Peterson says farmers have many questions about why their payments were based on established farm program production history, and not actual production. Peterson says he “stands ready to work with the administration” on long term fixes to the commodity safety net.
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Senator Baldwin Announces Increased Rural Mental Health Funding
Senator Tammy Baldwin this week announced increased mental health funding for farmers. The Wisconsin Democrat’s Facilitating Accessible Resources for Mental health and Encouraging Rural Solutions for Immediate Response to Stressful Times, or FARMERS FIRST Act, provides funding for local mental health resources. The bill was included in the 2018 farm bill, passed last year. Baldwin worked to pass an amendment last week to a Senate appropriations bill that will provide $8 million, an increase of $6 million from Fiscal Year 2019, for the bipartisan legislation. Baldwin says, “farmers are facing many difficult challenges and we all need to work together to provide them the support they need.” Reports from the Centers for Disease Control and Prevention have found that farmers and other individuals who work in agriculture experience a high rate of suicide. The increased funding will help expand access to stress reduction strategies and suicide prevention programs for people who work in agriculture.
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Coalition Urges Trump to Uphold Biofuel Promise
A broad coalition of biofuel and farm advocates this week sent a letter to the White House calling on President Donald Trump to fix a flawed proposal from the Environmental Protection Agency. The EPA proposal on biofuels, according to the coalition, “fails in its mission to reinvigorate farm economies and reopen biofuel plants across America’s heartland.” The letter was signed by 60 organizations, including the Renewable Fuels Association. It notes that the EPA’s draft plan undermines the administration’s commitment to restore integrity to the Renewable Fuel Standard and accurately account for biofuel demand destroyed by small refinery exemptions. The groups state that the flawed proposal “swaps out a critical component of the SRE remedy sought by farmers and,” and instead proposes to recover only those gallons previously recommended for exemption by the U.S. Department of Energy. The National Corn Growers Association says to the President, “The proposal – as written – will not provide the relief we believe you are seeking.”
