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National Ag News for November 18, 2022

Rural Mainstreet Economy Shrinks for Six Straight Months

The Creighton University Rural Mainstreet Index fell below growth-neutral for the sixth-consecutive month. On a scale of one to 100, 50 represents growth neutral. The Economic Confidence Index plummeted to its lowest level since 2020. Almost 31 percent of bank CEOs in the survey area recommend that the Fed cease raising interest rates. Despite the weaker rural outlook, only 14 percent of the CEOs say their bank had increased financial commitments on farm loans. Farmland demand remains strong as the Farmland Price index climbed above 50 for the 26th month in a row. Almost 61 percent of bank CEOs expect these high farmland prices to plateau, while 22 percent say those land prices will likely decline during the period. “The rural Mainstreet economy is now experiencing a downturn in economic activity,” says Dr. Ernie Goss. “Last month, almost one in four bankers said the economy was already in a recession.”

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Increased Ethanol Blend Rates Lower Fuel Costs for Drivers

A new Energy Information Administration report clearly shows higher ethanol blends helped moderate fuel prices after the Ukraine invasion. The report also says the ethanol blend rates hit a record summer average of 10.5 percent. “Fuel ethanol’s price discount to gasoline was one factor that led to the higher summer blend rate in 2022,” the report says. “Although ethanol prices were higher in 2022, they were still low relative to gas prices that were at the highest level since 2014. “The new analysis shows that American drivers gravitated toward lower-cost E15 and E85 this summer as war in Ukraine drove fuel prices to record highs,” says Renewable Fuels Association President and CEO Geoff Cooper. “The report also shows that President Biden made the right call by issuing emergency waivers to allow the continued sales of E15 through the summer.” RFA also says the report shows the importance of year-round access to E15.

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Black Sea Grain Export Deal Extended, Russia Wants More

The Black Sea Grain Export Deal, due to expire on Saturday, has been extended for another 120 days. Reuters says Moscow wants its own demands in the deal to get more fully addressed. The agreement protects a sea transit corridor and was intended to help alleviate a global food shortage. Ukraine, a major producer of grains and oilseeds, has three ports in Ukraine currently shipping grain. UN’s Secretary General says they welcome the agreement by all parties to continue the Black Sea grain initiative to facilitate the safe navigation of grain exports, foodstuffs, and fertilizers from Ukraine. Russian exports of ammonia via a pipeline to the Black Sea haven’t been agreed to as part of the renewal. However, Russia is continuing its efforts to resume those exports unimpeded by Western sanctions. The 120-day extension wasn’t the one-year deal the United Nations and Ukraine wanted. Russia says the  duration seems “justified.”

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USDA Proposes Science-Driven Updates to WIC

USDA’s Food and Nutrition Service announced proposed changes to the foods prescribed to participants in the Special Supplemental Nutrition Program for Women, Infants, and Children, known as WIC (wick). These science-based revisions incorporate recommendations from the National Academies of Science, Engineering, and Medicine and the Dietary Guidelines for Americans. “USDA is committed to advancing maternal and child health through WIC, helping mothers, babies, and young kids thrive,” says Ag Secretary Tom Vilsack. “These proposed changes will strengthen WIC, which is already an incredible program, by ensuring it provides foods that reflect the latest nutrition science to support healthy eating and bright futures.” The changes will increase the current level of assistance while providing WIC state agencies with more flexibility to tailor or accommodate personal and cultural food preferences and special dietary needs and increase variety and choice for WIC participants, making the program more appealing for current and potential participants.

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Sheep Industry Building a Sustainability Task Force

The American Lamb Board is working with the American sheep industry to create a new task force of industry stakeholders and research and extension specialists to develop a sheep sustainability report. The report will represent the sheep industry’s commitment to sustainability and the industry’s existing practices and goals for continuous improvement in animal care, environmental stewardship, social impacts, and industry productivity. The task force was developed, in part, because of a Michigan State University environmental footprint study. MSU gathered production data and calculated GHG emissions of five different sheep production systems: intensive production, intensive grazing, extensive grazing, range, and feedlots. The study identified the major production factors contributing to GHG emissions in U.S. sheep production, which will help develop mitigation strategies and best practices for each production system to reduce emissions. ALB says its environmental story was added to marketing programs in the past several months, and they’re gearing up for more.

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Ethanol Production Hits Lowest Level in a Month

The Energy Information Administration says ethanol output dropped to its lowest level in more than a month, and inventories dropped during the week ending on November 11. The newest EIA report says the production fell to an average of 1.011 million barrels a day. That’s down from 1.051 million barrels during the prior week and the lowest level since October. In the Midwest, the largest-producing region in the U.S., production dropped to 954,000 barrels a day from 992,000 barrels the week before. That’s also the lowest level for the Midwest in over a month. Gulf Coast production declined to an average of 23,000 barrels a day, a 1,000-barrel-a-day drop from the prior week. Rocky Mountain output fell to 13,000 barrels a day, the lowest output since September 23. The East Coast saw the only production increase at 13,000 barrels a day. Inventories through November 11 fell to 21.298 million barrels.

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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.

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