Another record year for ag exports

The U.S. is on its way to another record year in agricultural exports. Agriculture Secretary Tom Vilsack tells Brownfield that, by the end of this fiscal year on September 30th, exports will have set another new record.

“(A record) 152.5 billion dollars of ag exports, as well as a trade surplus record of 43 billion dollars as far as selling more than we purchase in terms of ag products,” Vilsack says.

There are several reasons for the strong export numbers, says Vilsack.

“I think it’s a quality product at an affordable price—it’s a reliable supply—and I think it’s aggressive promotion that USDA is engaged in with commodity groups and others to basically make sure the world knows about American agriculture.”

Ag exports for fiscal year 2015 are currently projected at 144.5 billion dollars, down eight billion dollars from the revised forecast for fiscal 2014. The declines are due to lower values of soybeans and soybean meal, and lower volumes and prices for other grains.

AUDIO: Tom Vilsack (:51 MP3)

WOTUS debate rages on

The debate continues to rage over the EPA’s proposed Waters of the U.S. (WOTUS) rule.

The latest development involves the release of EPA maps which critics say confirm that the agency is attempting to control land across the country.  Ashley McDonald of the National Cattlemen’s Beef Association calls it “the smoking gun for agriculture”.  McDonald says the maps show that EPA knew exactly what it was doing and knew exactly how expansive its proposal was before it was published.

ken with karl brooks epaIn a blog post, EPA spokesman Tom Reynolds disputes that notion, saying the law has nothing to do with land use or private property rights.

In an interview with Brownfield at the Farm Progress Show, EPA Region 7 administrator Karl Brooks reiterated EPA’s basic message—that the proposed rule simply clarifies the EPA’s jurisdiction for the Clean Water Act.

“The rule serves the needs of American agriculture by clarifying the jurisdictional reach of both the EPA and our state environmental partners,” says Brooks.  “So, simple is good. Clear is better.  The interaction you don’t have to have with the EPA or with the Army Corps, that’s the best interaction for a producer.  That’s where the proposed rule would take us.”

Brooks says the EPA is listening to agriculture’s concerns.

“I’d like to think that, if you take just some of the more heated rhetoric out that tends to boil up around the edges of this conversation, you can really see some basic principles there that look like they might provide a way forward for the rule.”

Brooks says the goal for the final rule is “clarity and workability”.

AUDIO: Karl Brooks (5:37 MP3)

Rep. Latta spends day talking agriculture

Congressman Bob Latta (R-OH) toured four agricultural operations in the 5th District on Thursday, August 28.

The Congressman tells Brownfield it’s important for him to get out and talked with farmers.

“It’s really interesting what you can learn in a day,” the Congressman said.

During his tour, the Congressman says he was hearing some concern about the new Farm Bill and the signup process.

“I’ve talked with folks on the training side to make sure they’ve got their training so when the farmers come in they can get everyone signed up,” said Congressman Latta.

Ohio Director of Agriculture Dave Daniels joined Congressman Latta on the tour in Wyandot and Hardin counties.

Audio: Congressman Bob Latta (R-OH) (5:25 mp3)

Two Midwestern governors chastise EPA

The governors of Nebraska and Iowa are not mincing words when it comes to their feelings about the U.S. Environmental Protection Agency (EPA).

In a conference call with reporters, Nebraska Governor Dave Heineman called EPA “the enemy of agriculture”.  Heineman says the agency is the biggest regulatory issue that farmers and ranchers face.

“The federal government, particularly under the Obama Administration, has been overly aggressive with regulation,” Heineman said. “We all support clean air, clean water and appropriate regulations.  But it’s the EPA that’s the enemy of agriculture, I’ll put it that way.”

Iowa governor Terry Branstad took the criticism of EPA a step further.  In an interview with Le Mars, Iowa radio station KLEM, Branstad put some of the blame on EPA for recently-announced layoffs at Deere and Company’s Waterloo, Iowa tractor plant.

“A few years ago, we had the best corn prices we’d ever seen. Now the EPA has cut the Renewable Fuels Standard, we have a large crop of corn out there and the price of corn is below the cost of production,” Branstad said. “When farmers see they’re not going to be making money, they quit buying equipment—and that’s just exactly what’s happened.

“We were promised by Gina McCarthy, the director of the EPA, we’d have a decision (on RFS) before the end of June.  They still haven’t—so I really lay that in the hands of the EPA,” Branstad said.  “They’ve really done real damage to the farm economy—and now the jobs at John Deere and farm machinery manufacturing as well.”

By statute, the final RFS rule for 2014 was due at the end of November last year. EPA finally submitted the final rule to the Office of Management and Budget on August 22nd.

A little more profitable on the farm in August

The Preliminary Index of Prices Received by Farmers in August was unchanged from July.  Producers received higher prices for cattle, milk, apples and broccoli.  Lower prices for corn, soybeans, wheat and broilers.

The Crop Index declined 2.2 percent.  Corn averaged $3.70 per bushel down 35 cents from July.  Soybeans decreased 90 cents to average $12.20 per bushel and all-wheat was down 31 cents to $5.85.  All hay dropped $7 to $185 per ton.

The Livestock Index increased 0.8 percent.  The August beef cattle price increased $4 to $160 per hundredweight.  The August hog price averaged $88.30 per hundredweight, down $5 from July.  Broilers were 6 cents cheaper at 60 cents per pound, turkeys were a penny lower at 73 cents per pound and eggs dropped 18.8 cents to average 86 cents per dozen.

The August all milk price increased 40 cents to $23.70 per hundredweight.  The August Milk-to-Feed Ratio is 2.55 up .19 from July and .87 above a year ago.  (the milk-to-feed ratio is the pounds of 16% dairy ration equal to the value of a pound of whole milk)

The Index of Prices Paid by Farmers in August is down 0.9 percent from July.  Lower prices for feeder pigs, complete feeds, concentrates and mixed fertilizer more than offset higher prices for feeder cattle, herbicides and insecticides.

The Index of Prices Received by Farmers is up 3.8 percent from August of 2013.  Prices Paid by Farmers are 4.7 percent higher than a year ago.

Read the full NASS report here:

NCGA hopes EPA has reversed RFS decision

The final rule on the Renewable Fuels Standard (RFS) for 2014 is now in the hands of the White House Office of Management and Budget (OMB).

The original EPA proposal cut the corn-based ethanol mandate from 14.4 billion gallons to 13 billion gallons. Chip Bowling, a Maryland farmer and president of the National Corn Growers Association, is hopeful that the EPA has reversed that decision.

bowling-chip-ncga“We’re hoping that they raise it back up to the 14 billion gallons as it should be,” Bowling says. “We’re thinking that they’re going to meet us halfway—that they’ll come up from the 13.1, to 13.6 or 13.7—but our hope is they’ll put it back to where it should be and stick with it.”

With a big corn crop on the way, Bowling says reducing the RFS doesn’t make sense.

“We’re growing another big crop—we’re going to double our carryover from last year to this year—and there’s no reason to back it down now,” he says. “The ethanol market, at this point, is doing well on its own—and it needs to keep moving forward.”

OMB has 90 days to complete its review of the rule.  Many analysts expect it to be published in late September or October, but there is also speculation it may not happen until after the November elections to avoid any political fallout.

AUDIO: Chip Bowling at Farm Progress Show (6:32 MP3)

Dairy Margin Protection sign-up starts Tuesday

U.S. Ag Secretary Tom Vilsack says sign-up for the new Margin Protection Program for dairy producers will run from September 2nd through November 28th.  If producers choose to not participate this year, they will be able to sign-up in future years but once they enroll in the program they must participate for the life of the Farm Bill through 2018.

The base price to participate will be $100 per farm per year.  That fee covers a $4 margin between the national all milk price and a feed cost formula determined by USDA using corn, soybean meal and alfalfa hay.  Final margins will be announced at the end of the month following each two-month period. For any two-month period in which margin payments are authorized, USDA will process producer payments quickly after the final margin numbers are announced. For example, if payments are authorized for January-February, final margins will be announced at the end of March, and program payments will be issued in early April.

Additional margin coverage may be purchased in 50-cent increments up to $8 on an annual basis.  After 2015 there will be a premium price difference between the first 4 million pounds of production and anything above that.

The premium can be paid in-full at sign-up or by February 1st or in two installments: 25% by February 1st and the remaining 75% by June 1st.

Production history will be established using the highest production from 2011, 2012 or 2013.  New herds without a history from those years will either establish a 12-month base or use the national average production per cow for a herd their size.  Any increase in the base will coincide with an increase in U.S. milk production.

USDA has an online calculator to help producers determine the level of coverage under the Margin Protection Program that will provide them with the strongest safety net under a variety of conditions. The calculator, available at www.fsa.usda.gov/mpptool allows dairy farmers to combine unique operation data and other key variables to calculate their coverage needs based on price projections. Producers can also review historical data or estimate future coverage based on data projections. The secure site can be accessed via computer, Smartphone, tablet or any other platform, 24 hours a day, seven days a week.

NMPF’s Jim Mulhern talks about the MPP 9:55 mp3

More details on the MPP from National Milk Producers Federation here:

Another strong week for new crop soybean sales

USDA reports soybean product export sales for the week ending August 21 were below pre-report estimates, while corn, soybeans, and wheat were within analysts’ expectations. Physical shipments of soybeans were above what’s needed weekly to meet USDA projections for the marketing year, but corn and wheat fell short of their respective marks.

Wheat came out at 403,600 tons (14.8 million bushels), up 94% from the week ending August 14, but down 17% from the four week average. Brazil purchased 94,000 tons and Nigeria bought 93,700 tons, while Panama canceled on 29,100 tons. At this point in the 2014/15 marketing year, wheat sales are 414.0 million bushels, compared to 556.8 million in 2013/14.

Old crop corn had a net reduction of 32,700 tons (-1.3 million bushels). Sales of 8,600 to 88,400 tons were offset by cancellations of 1,200 to 172,900 tons. Nearing the end of the 2013/14 marketing year, corn sales are 1.916 billion bushels, compared to 751.7 million in 2012/13. Sales of 695,600 tons (27.4 million bushels) for 2014/15 delivery were mainly to Colombia (140,900 tons) and South Korea (125,000 tons).

Old crop soybeans had a net reduction of 62,800 tons (-2.3 million bushels). Sales of 600 to 9,700 tons were offset by cancellations of 10,500 to 55,000 tons. So far this marketing year, soybean sales are 1.691 billion bushels, compared to 1.366 billion this time last year. Sales of 1,290,800 tons (47.4 million bushels) for 2014/15 delivery were primarily to China (655,000 tons) and Vietnam (112,200 tons).

Soybean meal was reported at 1,100 tons, with sales of 900 to 20,000 tons and cancellations of 1,200 to 21,300 tons. For the marketing year to date, soybean meal sales are 10,404,900 tons, compared to 10,032,600 a year ago. Sales of 76,100 tons for 2014/15 delivery were mostly to unknown destinations (45,200 tons) and Canada (10,700 tons).

Old crop soybean oil had a net reduction of 11,300 tons, with sales of 100 to 3,400 tons offset by cancellations of 100 and 15,000 tons. 2013/14 soybean oil sales are 810,300 tons, compared to 928,800 in 2012/13.

Net beef sales totaled 10,600 tons, an increase of 47% on the week, but a decrease of 7% from the four week average. The listed purchasers were Mexico (2,500 tons), Hong Kong (2,100 tons), South Korea (2,100 tons), Japan (1,700 tons), and Canada (900 tons).

Net pork sales totaled 7,600 tons. The reported buyers were Mexico (7,000 tons), South Korea (4,400 tons), Australia (3,000 tons), Japan (2,400 tons), and Canada (2,300 tons). Russia canceled on 15,700 tons.

NRCS signup generates huge response

The $2 million in NRCS funding to be used for cover crops in the Western basin of Lake Erie generated an overwhelming response.

The additional funding announced by NRCS will put cover crops on 35-40,000 acres, but State Conservationist Terry Cosby says the response was for twice that amount. Cosby says it’s another example of farmers stepping up to do the right thing.

“They know we have some areas that we need to make sure we get some cover on,” Cosby said. “So the farmers are doing their part.”

Farmers who have applications approved will be contacted their local NRCS office.

Cosby reminds farmers that if they were not approved for NRCS funding, there may still be funding available from other sources.

“Like to Department of Natural Resources and some of the Districts, they also have some dollars, so this was not a one shot opportunity,” said the State Conservationist. “There are some other funding sources, so continue to go into those field offices and ask about funding opportunities.”

The State Conservationist says things are moving at an accelerated pace in order to get cover crops seeded yet this fall.

Audio: Terry Cosby, State Conservationist, Ohio NRCS (4:50 mp3)

Rep. Latta, Dir. Daniels to tour 5th District

5th District Ohio Congressman Bob Latta and Ohio Director of Agriculture Dave Daniels will be on the road Thursday, August 28.

A tour of four agricultural operations in the 5th District will showcase the diversity and strength of the agricultural industry, as well as the challenges it faces in the District.

“Ohio’s Fifth Congressional District is home to more than 10,000 farms and is the top producer of soybeans, corn and wheat in the state,” said Latta. “Our thriving agricultural community is a leading economic driver that not only creates jobs and economic opportunity, but also provides American consumers with a safe, reliable food source.”