READ the NAFB’s National Ag News for Monday, April 13th

Sponsored by the American Farm Bureau Federation

Cattle Market Investigation will now Expand

Cattle groups and senators have been putting pressure on Ag Secretary Sonny Perdue, who responded to the pressure via Twitter. His tweet says the USDA’s Packers and Stockyards Division would expand its investigation into the cattle markets. The Hagstrom Report says the inquiry will now cover the cattle market conditions stretching from a summertime fire in Kansas last year up to the market conditions following the emergence of COVID-19. The National Cattlemen’s Beef Association had called for an investigation last Wednesday, with Perdue responding on the same day. NCBA President Marty Smith says, “I would like to thank President Trump and Secretary Perdue for their quick response to NCBA’s request to expand the agency’s investigation into the cattle markets.” He says they believe the investigation will restore cattle producers’ confidence in the market. They’re also looking forward to the agency’s recommendations on how to improve things in the industry. Senator Kevin Cramer of North Dakota pointed out that live cattle futures’ prices declined in March while prices for boxed beef sold to grocery stores rose. “The obvious price disparity is harmful not only to the consumer but also for our hardworking, honest cattlemen who just want a fair market,” Cramer says.

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Ethanol Production Numbers Highlight Steep Drop in Fuel Demand

The U.S. ethanol industry is hurting due to the COVID-19 outbreak keeping most drivers off the road. Reuters says the industry has cut production more than it has in recent memory as fuel demand continues to plummet. The output of the corn-based biofuel fell off a cliff, dropping a record 20 percent to an average daily rate of 672,000 barrels. That’s the lowest production rate since the Energy Information Administration began publishing the weekly data in mid-2010. As expected, stockpiles jumped to a record 27 million barrels, underscoring the struggling demand. Federal regulations mandate that nearly every gallon of gas sold in the U.S. has about 10 percent ethanol. However, the worldwide virus outbreak drove oil prices lower amid a dispute between Russia and Saudi Arabia regarding production levels. Those factors have combined to make it impossible for ethanol makers to profitably produce their fuel. Dozens of plants have idled production or slowed way down, including POET, one of the industry’s top producers. Last week, POET said it idled production at three facilities in Iowa and South Dakota.

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USDA Releases April WASDE Report

The April World Ag Supply and Demand Estimates from USDA show both corn and soybeans with higher ending stocks. The 2019-2020 corn outlook calls for reduced imports, greater feed and residual use, lower food, seed, and industrial use, as well as larger ending stocks. Ending stocks were raised 200 million bushels to 2.092 billion. The season-average price for corn dropped 20 cents to $3.60 a bushel. U.S. soybean numbers show lower exports, seed use, residual use, higher crush, and higher ending stocks. Higher crush will only partly offset the other lower numbers, bringing projected ending stocks to 480 million bushels, 55 million bushels higher than last month. The season-average soybean price is forecast to drop five cents to $8.65 a bushel. The wheat outlook expects lower exports, reduced domestic use, and increased ending stocks. The forecast now expects ending stocks of 970 million bushels, up 55 million from the previous month. The season-average farm price for wheat is up by five cents a bushel to $4.60.

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Meatpackers Close a Few Plants due to Coronavirus

Fears of meatpacker employees contracting coronavirus due to the close conditions they work in have led to several facilities idling production in recent weeks. For example, Tyson Foods has temporarily ceased operations at its pork plant in Columbus Junction, Iowa, after two dozen employees were found positive with the coronavirus. Politico says at least three people who work in Tyson plants, as well as JBS USA, have died from the virus. However, there aren’t a large number of operations that have temporarily shuttered production or even scaled back. The CEO of JBS says he’s “100 percent confident” that his employees are safe at a beef plant in Greely (GREE-lee), Colorado. However, a longtime employee died after being hospitalized with the virus. The major meatpacking companies all say they’ve taken appropriate steps to abide by CDC recommended guidelines. The food industry has been deemed “essential” and continues to function amid the pandemic. “As employees have tested positive for COVID-19, the industry has been working with local health authorities and the Food Safety and Inspection Service to take immediate steps to quarantine, sanitize facilities, and prioritize the health and safety employees,” says Sarah Little, VP of Communications for the North American Meat Institute.

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Wisconsin Senator wants Farmers Eligible for SBA Grants, Forgivable Loans

Wisconsin Senator Tammy Baldwin is calling on the administrator of the Small Business Administration to clarify that farms are eligible for both grants and loans. She wants to make sure farmers are eligible for the Economic Injury Disaster Loan Program, as well as guarantee they can get sufficient loans through the Paycheck Protection Program, which was created by the CARES Act. “The collapse in demand from the coronavirus pandemic has caught our farmers at a particularly challenging time because many have suffered for years from depressed prices and the uncertainty brought on by trade wars,” she says in the letter SBA Administrator Jovita (Joe-VEE-tah) Carranza. “The SBA’s Paycheck Protection Program and the $10,000 advances from the expanded Economic Injury Disaster Loan Program could provide much-needed relief for farmers, provided that the programs are implemented with the unique needs of agricultural businesses in mind.” The letter comes after the SBA issued guidance saying that farms could apply for the Paycheck Protection Program, regardless of income levels. Baldwin wants the SBA to go further and clarify that farmers are both eligible for Economic Injury Disaster Loans and have the option to use alternative calculations other than revenue, such as net earnings, that might provide greater loan values for farmers who need the help.

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Lots of Chicken Wings Available Thanks to Coronavirus

The poultry market missed a big sales opportunity when the NCAA basketball tournament was canceled due to the coronavirus. The Washington Post says March Madness is the second of the two biggest annual events for wing sales, with the other being the Super Bowl. As the U.S. is asking citizens to stay at home to prevent further spread of the outbreak, the canceled basketball tournament means there is a whole bunch of chicken wings out there on the market. “That is a fact,” says Will Sawyer, lead animal protein economist at CoBank. “That’s real.” Wings are normally the most expensive part of the bird but haven’t been this cheap since September of 2011. They sold for close to two dollars a pound during this year’s Super Bowl. They’re now selling for half that amount. Poultry producers sold 1.24 million pounds of wings during the week the tournament was supposed to be held. Last week, they sold 433,000 pounds.

SOURCE: NAFB News Service

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By Brian Allmer - The BARN

Brian Allmer & the BARN are members of the National Association of Farm Broadcasting (NAFB), the Colorado FFA Foundation, the Colorado 4H Foundation, the Colorado Farm Show Marketing Committee, 1867 Club Board Member, Denver Ag & Livestock Club Member, the Weld County Fair Board, the Briggsdale FFA Advisory Council, Briggsdale 4H Club Beef Leader & Founder / Coordinator of the Briggsdale Classic Open Jackpot Show.