NATIONAL AG NEWS SPONSORED BY THE AMERICAN FARM BUREAU FEDERATION

National Ag News for July 22, 2022

Ethanol Production Rises After Six Consecutive Weekly Declines

The Energy Information Administration says U.S. ethanol output increased for the first time in six weeks while inventories dropped slightly. During the week ending on July 15, production rose to an average of 1.03 million barrels a day. The EIA report says that’s up from just over one million barrels a day during the previous week, the first gain since June 10. The Midwest produces more ethanol than any other part of the U.S. and saw its output jump to an average of 973,000 barrels a day from 944,000 barrels a week earlier. Gulf Coast output climbed to an average of 26,000 barrels a day, up from 23,000 the prior week. That’s where all of the gains took place as the Rocky Mountain region stayed steady at 15,000 barrels a day, and the West Coast output held at 9,000 barrels a day for the eighth-straight week. Inventories dropped slightly to 23.55 million barrels.

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House Democrats Introduce Child Nutrition Reauthorization Bill

House Democrats introduced a bill that would reauthorize child nutrition programs. Those programs include school meals, the Special Supplemental Nutrition Assistance Program (WIC), and a number of smaller programs. The Hagstrom Report says child nutrition programs haven’t gotten reauthorized since 2010’s Healthy Hunger-Free Kids Act. The School Nutrition Association, which represents school foodservice directors and companies that make the food, says it’s expecting a markup on the legislation next week. Prospects for reauthorization are uncertain as Democrats and Republicans have had differences over the nutritional requirements in the 2010 bill. The USDA also made it easier for children to get free school meals and for mothers and infants to use the WIC program. The reauthorization bill would make some of those policies permanent. Republicans are expected to question or even oppose those policies. The Senate Ag Committee, which has jurisdiction over child nutrition in the Senate, hasn’t released its own bill.

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Farm Service Agency Updates Livestock Indemnity Payments for Smaller Calves

The Farm Service Agency made changes to its payment rates under the Livestock Indemnity Program. The agency changed rates for calves under 250 pounds and will now value them at the same level as non-adult cattle weighing between 250 and 399 pounds. FSA also increased payment rates for calves under 400 pounds. The U.S. Cattlemen’s Association had written FSA Administrator Zach Ducheneaux and praised the changes. The Independent Beef Association of North Dakota says the April winter storms that hit North Dakota left cattle producers with extreme losses, most of which were in cattle under 250 pounds. LIP payment rate is set at 75 percent of the fair market value. The payments have gotten updated to use the same price as the 251-399 pound livestock. The rate is now set at $474.38 a head for cattle weighing less than 250 pounds. The previous payment rate for calves under 250 pounds was $175.

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American Lamb Board Working on Strategic Planning

The American Lamb Board last released a strategic plan in 2018. The world has changed since then, so the Board is developing a new strategic plan, noting that it faces dynamics that the industry has previously never faced. “Instability in the economy, the economic viability of sheep production, consumer uncertainty, supply chain issues, and increasing pressure from imports are critical issues,” says ALB Chair Peter Camino (Ka-MEE-no). “We are determined to find ways for the U.S. Lamb Checkoff to help our industry through our role in promotion, research, and producer outreach.” The current plan expires in 2022 and prioritizes increasing the quality and consistency of American Lamb and regaining market share from imports. “We need to give consumers more reasons to desire and ask for U.S. lamb even though we are premium prices,” Camino says. “The past four years show that we’ve made progress in many areas, but we need to push harder and farther.”

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Biden, Xi Will Talk Soon on Tariffs, Trade, and Taiwan

Plans are in place for President Joe Biden and Chinese President Xi Jinping to meet by the end of the month as tensions increase over trade commitments, tariffs, and Taiwan. The two leaders last spoke on a call four months ago, and the new call would come as the administration considers cutting import duties on Chinese goods to help reduce inflation pressures on American consumers. Reuters says rising inflation has prompted the look at possible tariff relief. That relief may include cutting or dropping the Section 301 tariffs imposed by former President Trump on approximately $370 billion in Chinese imports. Sources told Reuters that the administration is considering whether to pair a removal of at least some of the tariffs with a new investigation into China’s industrial subsidies and its efforts to dominate key economic sectors. The U.S. says high-level engagement is needed to stabilize what’s been a difficult relationship between the countries.

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Prices for Cereal Products Rose 11 Percent During First Half of 2022

Consumer prices for cereal products as measured by the Consumer Price Index rose about 11 percent from January through June of 2022 compared to the same time last year. It’s the largest year-over-year increase during those six months since 1981. The USDA says the rise in consumer prices for cereal products tracks with a more substantial increase in the price of wheat. The Kansas City Wheat Market most closely reflects the prices that mills pay for wheat, and cash wheat prices were up 63 percent from the same period last year. The heightened volatility follows a historically typical pattern. Price changes in commodity markets tend to be relatively more extreme than the changes in consumer prices. Generally, commodity prices make up a small portion of the value of these cereal products because of the level of transformation and transportation that these products go through while moving through the value chain.

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By Tucker Allmer - The BARN

Tucker 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.