NATIONAL AG NEWS SPONSORED BY THE AMERICAN FARM BUREAU FEDERATION
National Ag News for November 10, 2023
Cattle Group Commends New Competition Initiative
The USDA released a package of rules and orders seeking to increase competition in the livestock industry. That package establishes a Chief Competition Officer at USDA’s Agricultural Marketing Service. This position will be hired as a career rather than a political appointment. The officer will help elevate and institutionalize competition-related concerns at USDA. “Today’s announcement is another item crossed off a to-do list the administration is following to ensure a fairer, more competitive marketplace for U.S. cattle producers,” says U.S. Cattlemen’s Association President Justin Tupper. The package also updates AMS Institutional Meat Purchase Specifications that large volume buyers like federal, state, and local government agencies, schools, restaurants, hotels, and other food service users follow when buying meat products. Currently, meat and meat products do have to be of domestic origin, but the updated standards will specify that to mean only animals that are born, raised, and slaughtered in the U.S.
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November WASDE Finds Higher Corn and Soybean Production
The USDA’s November World Agricultural Supply and Demand Estimates show increased corn and soybean production compared to the previous report. The corn outlook is for larger production, domestic use, exports, and ending stocks. Corn production is up 170 million bushels from last month on a 1.9-bushel increase in yield to 174.9 bushels an acre. Corn ending stocks are up 45 million bushels to 2.2 million. The season-average corn price is down 10 cents to $4.85 a bushel. The soybean outlook shows increased production and ending stocks. Soybean production is forecast at 4.13 billion bushels, a 25 million increase on higher yields. Ending stocks rose to 245 million bushels. The season-average soybean price is unchanged at $12.90 per bushel. The wheat outlook calls for larger supplies and decreased domestic use. Ending stocks are projected to rise by 14 million bushels to 684 million. The season-average farm price dropped a dime to $7.20.
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Commerce Decision on Imports Saves Farmers a Lot of Money
The U.S. Commerce Department recently lowered the duties placed on phosphate fertilizers imported from Morocco. The National Corn Growers Association says this move gives true savings to farmers and access to critical inputs that have been scarce during the last couple of years. Commerce lowered the rates from 19.97 percent to 2.12 percent. “Farmers were already facing rate hikes on inputs, and the duties were making the situation worse,” says NCGA President Harold Wolle. “This gives us more hope.” Assuming Commerce finalizes those duty rates and imports resume, farmers could see a reduction in added costs of $7 per acre on imported fertilizer from Morocco. NCGA’s analysis says many factors and dynamics contribute to changes in fertilizer markets and prices, but the imposed duty rates undoubtedly had an impact on the prices paid by farmers. “Our advocacy campaign to lower the duty rates wouldn’t have succeeded without our members,” Wolle says.
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Initiative to Enhance Specialty Crop Industry’s Competitiveness
USDA Deputy Secretary Xochitl (zo-CHEEL) Torres Small announced the agency is starting a new effort to support producers in the U.S. Specialty Crops sector and increase its competitiveness. “We all count on America’s specialty crops for reliable access to nutritious, fresh foods,” Torres Small says. “As part of the new effort, USDA has compiled useful information on its programs and services that support the specialty crops industry into a Specialty Crops Resource Directory.” The directory will be a one-stop shop for the sector and contains a comprehensive snapshot of USDA’s resources and services for specialty crop producers and businesses in one convenient location. Also, USDA leadership will directly engage with the specialty crop industry and its producers during the next several months to get feedback on how the Department can better address gaps in services and meet the industry’s needs. A new webpage on the initiative is available at usda.gov.
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USB Invests in Infrastructure to Give Growers an Edge
The United Soybean Board invests in many infrastructure projects that will help increase profits for soybean growers and the industry itself, which is undergoing significant changes. Through the soy checkoff, USB pursued feasibility studies leading to the dredging of the Mississippi River in Louisiana, a terminal expansion in Washington, and a reduced freight toll agreement on the St. Lawrence Seaway. “The goal of these investments is to give U.S. soybean growers a competitive edge in the global market,” says Belinda Burrier of the USB Board of Directors. “This helps us be more reliable in moving soybeans from our farm to the global customer.” While the checkoff isn’t allowed to invest directly in these projects, it does enable them by investing in feasibility and engineering studies. “It’s a win-win as we make $12.34 on every dollar invested,” Burrier adds. “I don’t know of too many investments with that kind of return.”
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CHS Yearly Revenues Down Five Percent, Net Income Up 13 Percent
CHS Inc., one of the nation’s largest agribusinesses, reported a net income of $1.9 billion for the fiscal year ending on August 31 compared to $1.7 billion for fiscal year 2022. Key drivers included consolidated revenues of $45.6 billion for fiscal year 2023 compared to $47.8 billion for fiscal year 2022. In the company’s ag segment, robust meal and oil demand contributed to higher earnings in the company’s soybean and canola processing business. “The support of our member cooperatives and farmer-owners, dedication of our employees, exceptional operational performance, and favorable market conditions enabled us to achieve the strongest earnings in our history during fiscal year 2023,” says Jay Debertin, president and CEO of CHS Inc. As a result of those earnings, CHS intends to return $730 million in cash patronage and equity redemptions to its member cooperatives and farmer-owners in fiscal year 2024, demonstrating its “commitment to share profits” with producers.
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