Efforts to regain Colombia market share begin

Work will begin soon to regain market share in Colombia that was lost to other countries that beat the U.S. to free trade agreements with that South American customer. That’s according to Wendell Shauman, Chairman of the US Grains Council.

“It’s a market that should come back to us quickly,” Shauman told Brownfield Thursday. “The problem you have, it’s like any other business and business relationship, they’ve developed relationships over the last year to year-and-a-half with other suppliers and we’re going to have to go back and try and win that business back, and that will be the immediate challenge for us; we’ll be down there probably within two weeks to start that process.”

Colombia switched grain suppliers because of a competitor’s lower price. Shauman says Colombia liked doing business with U.S. grain growers, but they could buy more inexpensively from suppliers with whom they had free trade agreements. That lower price was because of the difference in tariffs.

“We will be lower priced now,” said Shauman, who farms at Kirkwood, Illinois. “Once that free trade agreement passed, our tariff rate goes to zero and there’s also a [price] band system they used over there; that also goes away, plus we have the advantage of lower freight going in, so we will be the low-cost provider now.”

Provisions of the Colombia Free Trade Agreement take effect only after ratification by Colombia’s government, which is anticipated.

To put it in perspective, Shauman says other markets are bigger for U.S. grain growers, but these agreements will mean improvements in exports that have been years in coming.

AUDIO: Wendell Shauman (5 min. MP3)

‘Farm dust’ bills gaining momentum

Legislation prohibiting the EPA from regulating farm dust is gaining momentum in the House and Senate. 

A hearing is scheduled for Friday on the House version of the bill, sponsored by South Dakota Representative Kristi Noem. 

“The EPA has talked about putting these standards into place in the past,” says Noem. “We have certainly seen detrimental regulations go forward in this same process, and we’re trying to stop that from happening before they get put into place and we can’t get them repealed.”

One of those testifying will be National Cattlemen’s Beef Association president Bill Donald of Montana.

“My message is going to be fairly loud and clear that one thing we need out of Washington, D.C., at this particular juncture—and what’s been lacking—is common sense,” Donald says.

The EPA has denied that it has plans to regulate farm dust, but Donald isn’t buying it. “People have trouble comprehending that an agency would even go down that road.  It’s unfortunate that we have to have legislation to stop an agency from doing something so ridiculous—but, unfortunately, that’s the times we’re living in.”

And in the Senate, Nebraska’s Mike Johanns says his dust bill is gaining bipartisan support.  Johanns says the purpose of the legislation is to create a separation in the law between smog and “naturally-occurring” dust.

“It does not prevent EPA from protecting clean air by regulating smog,” Johanns says. “It allows the EPA to distinguish between particles from naturally-occurring farm dust.  It’s sensible and bipartisan.”

Concerns over possible farm dust regulations grew out of an EPA draft recommendation—released earlier this year—that proposed stricter standards for particulate matter in the air.

AUDIO: Mike Johanns (3:19 MP3)

Brownfield’s Tom Steever and the Nebraska Radio Network contributed to this story.

Wisconsin lifts TB restrictions on Minnesota cattle

The USDA has restored Minnesota’s Bovine TB-free status. An infected herd was found in the northwestern part of the state in July of 2005. By the end of 2006, the infected herd number grew to 11 prompting the Ag Department to reduce Minnesota’s status and many states to put restrictions on cattle from the state. A year ago, all but four counties in the state were reclassified to TB-free. An all-out effort by producers and the Minnesota Board of Animal Health has eliminated the disease and restored the TB-free status to those four counties last week.

Neighboring Wisconsin State Veterinarian Dr. Bob Ehlenfeldt has removed testing requirements on cattle entering his state from Minnesota. The only requirements for Minnesota cattle entering Wisconsin now will be official identification and certificates of veterinary inspection – the same requirements that all livestock entering Wisconsin need.

USDA also lifted restrictions on all cattle in New Mexico. Bovine TB had been found and restrictions put in place in 2008. In 2010, the restrictions were lifted on all but two counties in the state, now those two counties have been declared TB-free as well.

Bovine tuberculosis is a bacterial infection that spreads between animals in close contact, through the air and in contaminated milk and manure. Restrictions are lifted after 24 consecutive months of testing finds no disease.

An Illinois Soybean director says FTAs a plus

An East-Central Illinois soybean grower who farms along the Indiana state line says the passage of the Korea, Panama and Colombia FTAs by Congress Wednesday night is a case of better late than never.

Mike Marron farms in Fithian, in Vermillion County, and is District 7 director of the Illinois Soybean Association.

He says the proximity with Panama and Colombia is a huge plus moving forward with the FTAs.

“We’ve had close ties with those nations, they’re in our hemisphere. They are within close proximity to us so we definitely have an advantage over competitors like the EU as far as transportation costs go. So, we can be very competitive in those nations,” says Marron.

Marron tells Brownfield that all that was needed were the trade agreements.

AUDIO: Mike Marron (7:00 mp3)

Soybeans rally on supply, demand

Soybeans were higher on commercial and technical buying. The nearby supply remains tight, demand looks good, and USDA did lower the production estimate Wednesday. Unknown destinations bought 110,000 tons of 2011/12 U.S. soybeans ahead of the open and recent rains have caused harvest delays in some areas. Soybean meal was up and oil was mixed on a combination of spillover from soybeans and traders getting ready for the monthly NOPA crush numbers. The average estimate for the crush is 118 million bushels with soybean oil stocks at 2.139 billion pounds. India issued a tender for 1,500 tons of crude soybean oil and South Korea is in the market for 28,500 tons of U.S. soybeans. According to China’s General Administration of Customs, September soybean imports were 4.13 million tons, 8% less than August and 11% below September 2010. USDA’s weekly export sales report is out Friday at 7:30 AM Central. Soybeans are pegged at 500,000 to 800,000 tons, meal is seen at 75,000 to 225,000 tons, and oil is placed at 5,000 to 10,000 tons.

Corn was modestly lower on fund selling, in addition to the outside market direction. There was also follow through from Wednesday losses, but the downside was limited by slow farmer selling. Even though they were both considered old news after being rumored earlier this week, China bought 900,000 tons of 2011/12 U.S. corn outright and unknown destinations picked up another 292,110 tons of 2011/12. Ethanol futures were mixed. UkrAgroConsult states Ukraine’s grain exports for October 1 through 8 totaled 201,000 tons, about half of what they were during the same period in September, with 150,900 tons of that corn and 50,500 tons wheat. China’s National Grain and Oils Information Center sees domestic corn production at 184.5 million tons with USDA’s projection at 182 million tons and U.S. Grains Council’s most recent guess at 167 million tons. China’s General Administration of Customs reports corn exports for September were 10,200 tons, down 23% on the month but up 77% on the year. The Buenos Aires Grain Exchange says 30.5% of Argentina’s corn crop is planted. Weekly U.S. corn sales are estimated at 700,000 to 1.1 million tons.

The wheat complex was lower on commercial and fund selling, along with spillover from the outside markets. As much as anything, Wednesday’s USDA supply and demand numbers confirmed the bearish global fundamentals, and Kansas City picked up additional pressure from the easing of drought conditions in key hard red winter growing areas. Japan bought a small amount of U.S. wheat but aside from that, there was no real fresh news; Tokyo picked up 31,558 tons of U.S. hard red winter and 23,780 tons of U.S. western white, along with 44,785 tons of Canadian western red spring and 29,040 tons of Australian standard white. European wheat was lower, following the lead of the U.S. trade. Ukraine’s Ag Ministry reports 87% of the grain harvest is complete at 44.4 million tons and Kazakhstan’s Ag Ministry states their grain harvest is 94.6% finished at 26.2 million tons. According to the Buenos Aires Grain Exchange, Argentina’s wheat crop is developing well thanks to recent rainfall with production expected to total 12.6 million tons. Weekly U.S. wheat sales are projected at 300,000 to 500,000 tons.

‘ANF Day at Kinnick’ is this Saturday

America Needs Farmers–ANF.

That message will reverberate around historic Kinnick Stadium in Iowa City this Saturday when the Iowa Hawkeyes host Northwestern.  It will be “ANF Day at Kinnick”, the result of a partnership announced this summer between the Iowa Farm Bureau and University of Iowa Athletics Department. 

ANF was first lauched in 1985 during the height of the Farm Crisis by legendary Hawkeye coach Hayden Fry, who wanted to show an increasingly urban nation why agriculture matters. And Iowa Farm Bureau president Craig Lang says while the agricultural landscape has changed over the years, big challenges still remain.

“Because we have a growing world population, we will have to grow nearly 100 percent more food than we are today, with the same resources we had—natural resources—in 1985,” says Lang.

AUDIO: Craig Lang (5:37 MP3)

Farmer and Farm Bureau member Larry Sailer of Iowa Falls says the ANF campaign is a good opportunity to reach non-farmers.

“We’ve got a fantastic story to tell of how we have succeeded with all the advances in farming,” Sailer says, “and we’d like to continue doing so.”

AUDIO: Larry Sailer (3:08 MP3)

Among the activities planned for Saturday is the UI’s first stadium “card stunt”, where all fans in the four grandstands of Kinnick will, on cue, hold them up to make two designs and messages to the 70-thousand people in the stadium and the national television audience watching on the Big Ten Network.


Pioneer’s largest seed plant opens in Missouri

Pioneer Hi-Bred has opened its $60 million parent and commercial soybean seed production plant in New Madrid County, Missouri, in the Missouri Bootheel.  It is the largest of Pioneer’s plants and production location manager Nathan Bengtson tells Brownfield  there’s been high demand for Pioneer’s Y Series soybeans and the new facility will help meet that need as well as bring  dozens of new jobs to the area.

AUDIO: Nathan Bengtson (5:00 mp3)

Pioneer Hi-Bred celebrates Grand Opening of Missouri plant

Cattle trade at mostly lower prices in all regions

A fairly active cattle trade developed in all regions on Thursday morning at prices steady to $2.00 lower than last week from 118.50 to 120.00 live and dressed sales 1.00 to 2.00 lower at 188.00.The selling interest dried up once live cattle futures reversed from session lows and closed significantly higher. While feedlot managers will no doubt insist on more money for cattle remaining on the show lists, DTN’s guess is business is essentially done for the week. The kill totaled 126,000 head, 4,000 less than last week, and 3,000 more than a year ago.

Boxed beef cutout values were lower on the select and steady on the choice, with moderate demand and offerings. Choice boxed beef closed .03 lower at 186.00, and the select was down 1.00 at 168.29.

Chicago Mercantile exchange live cattle contracts settled 10 to 162 points higher bouncing off session lows at midsession as funds bought into the market. Even though cattle traded at lower prices in the feedlot trade the fact that they were not sharply lower lent some support to the market.  October settled .57 higher at 121.05, and December was up 1.62 at 122.85.

Feeder cattle settled 12 to 97 higher on support from the live cattle pit. The general weakness in outside markets worked to limit additional gains. October up .87 at 93.00, and December was up .57 at 88.02.

[Read more...]

Closing Grain and Livestock Futures: October 13, 2011

Dec. corn closed at $6.38 and 1/4, down 2 and 1/2 cents
Nov. soybeans closed at $12.57, up 17 and 1/2 cents
Oct. soybean meal closed at $325.20, up $5.10
Oct. soybean oil closed at 52.47, up 61 points
Dec. wheat closed at $6.18, down 8 and 3/4 cents
Oct. live cattle closed at $121.05, up 57 cents
Oct. lean hogs closed at $93.00, up 87 cents
Nov. crude oil closed at $84.23, down $1.34
Dec. cotton closed at 101.56, up 105 points
Oct. Class III milk closed at $17.94, up 4 cents
Dow Jones Industrial Average: 11,478.13, down 40.72 points

Commodity groups praise passage of FTAs

Now that the Free Trade Agreements have passed the U.S. House and Senate, the President of the American Soybean Association, Alan Kemper of Indiana hopes President Obama will follow through and sign the agreements as quickly as possible. After that Kemper says work can begin to rebuild lost market share.

“International markets are about relationships. We’ve just got to stay in touch,” Kemper tells Brownfield, “Part of the free trade agreements was reduction in tariffs on our products coming in to, particularly, Colombia and Panama, which is huge. So, for agriculture, it’s a large market for us.”

Kemper says ASA can now turn their attention to the writing of the 2012 Farm Bill which has gone from a marathon to a full sprint.

Audio: Alan Kemper, President, ASA (1:20 MP3)

Other commodity and livestock groups are reacting positively to the ratification of the three Free Trade Agreements they all have been pushing for for many years.

The National Pork Producers Council is calling the passage by Congress “one of the greatest victories for the U.S. pork industry.”

National Cattlemen’s Beef Association President Bill Donald said, “It is a great day for cattlemen all across the country.

National Corn Growers’ Association President Garry Niemeyer, a corn farmer from Auburn, Illinois, says passage ensures the industry “continues to lead the nation in economic growth and international competitiveness.”

US Grains Council Chairman Wendell Shauman says the agreements will help the U.S. regain market share in Panama and Colombia that had been lost when other countries forged similar pacts with those countries.

The U.S. Dairy Export Council and the National Milk Producers Federation welcomed the news. NMPF president Jerry Kozak said, “The export gain for dairy from the Korea FTA in the first few years after implementation will be approximately $380 million per year, on average, and the gains from the Colombia and Panama FTAs will add another $50 million annually.”

 ~Brownfield team members contributed to this report