EU to help dairy producers

The European Commission announced it will offer Private Storage Aid to pay for the storage of butter, skim milk powder and some cheeses for three to seven months.  Farm milk prices have plunged in Europe since Russia banned imports from countries which imposed sanctions on them.

A draft proposal will be presented to the Commission in the next week.  The EU Ag Commissioner Dacian Ciolos  also announced he will present a full analysis of the impact the Russian ban is having on European agriculture.  The Commissioner promised “further measures” if needed to support EU farmers.

Russia imposed a one-year embargo on meat, fish, dairy, fruit and vegetables from the United States, the European Union, Canada, Australia and Norwayy in retaliation for Western economic sanctions over Russia’s actions in Ukraine.

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)

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.

Fonterra increasing Chinese presence

New Zealand dairy giant Fonterra says it is going to buy a 20 percent stake in Chinese infant food manufacturer Beingmate.  Once the partnership is created, the joint venture will buy Fonterra’s Darnum plant in Australia.

The cooperative also announcing plans to spend $555 (NZ) million on plants in New Zealand to increase milk powder production.

New Zealand, the world’s largest dairy exporter already sells a lot of milk powder to China, the deal would give them a better distribution system in the country.

 

Fonterra also announcing it will maintain its forecasted farm gate milk price of $6 (NZ) per kilogram of milk solids for the 2014/15 season.  Despite declining global prices, Co-op chair John Wilson says their longer-term analysis calls for improving prices later this year and into 2015 as global demand grows.

On July 29th Fonterra reduced its forecast farmgate milk price for the 2014/15 season from $7 (NZ) to $6 (NZ) per kilogram of milk solids.

Fonterra is required to consider its Farmgate Milk Price every quarter as a condition of the Dairy Industry Restructuring Act.

U.K. dairy farmers facing tough times

While U.S. dairy farmers are enjoying some of the most-profitable times in years, it is quite a different story in the United Kingdom.  UK dairy farmers had been pushing to increase production to meet global demand but China has reduced purchases and Russia has stopped buying from any country that has imposed sanctions over the Ukraine situation.  As a result, the UK suddenly finds itself with a huge milk surplus and plunging prices.

A group called UK Farmers for Action which was responsible for the so-called SOS Demonstrations in 2012 are asking members if they would support direct action again before the end of the week.  The group says the time has come for “some form of direct peaceful action to let both retailers, processors and government know that UK milk producers are not going to accept prices below 2011.”

They promise any demonstrations will be “totally controlled and peaceful, working with police at all times.”  Within 24 hours the group had received more than 500 “yes” votes.

 

Solid week for wheat inspections

USDA reports wheat export inspections for the week ending August 21 were larger than what’s needed weekly to meet projections for the 2014/15 marketing year, but corn and soybeans both fell short of their respective marks for 2013/14. The 2013/14 marketing year for corn, soybeans, and sorghum ends August 31.

Wheat came out at 558,113 tons, down 38,562 from the week ending August 14 and 295,662 lower than the week ending August 22, 2013. At this point in the 2014/15 marketing year, wheat inspections are 5,739,441 tons, compared to 8,299,578 in 2013/14.

Corn was reported at 1,091,301 tons, up 119,996 from the previous week and 782,959 higher than this time last year. For the 2013/14 marketing year to date, corn inspections are 45,939,659 tons, compared to 1,229,967 in 2012/13.

Soybeans were pegged at 145,161 tons, 88,252 more than the prior week and 76,561 larger than a year ago. So far this marketing year, soybean inspections are 43,362,534 tons, compared to 35,676,751 last year.

Sorghum inspections totaled 239,780 tons. That’s an increase of 74,868 tons on the week and 180,895 on the year. 2013/14 sorghum inspections are 4,979,367 tons, compared to 1,787,303 in 2012/13.

New crop corn, soybean sales solid

USDA reports wheat export sales for the week ending August 14 were lower than expected, while corn, soybeans, and soybean products were all within analysts’ estimates. Physical shipments of wheat were above what’s needed weekly to meet USDA projections for the 2014/15 marketing year, but corn and soybeans fell short of their respective marks for 2013/14.

Wheat came out at 209,200 tons (7.7 million bushels), down 38% from the week ending August 7 and 62% lower than the four week average. The Philippines picked up 83,500 tons and Nigeria bought 62,400 tons, but Brazil canceled on 58,800 tons. For the 2014/15 marketing year to date, wheat sales are 399.4 million bushels, compared to 536.6 million in 2013/14.

Corn was reported at 99,900 tons (3.9 million bushels), noticeably more than the previous week, but 15% less than the four week average. Egypt purchased 112,900 tons and South Korea picked up 93,500 tons, but unknown destinations canceled on 250,500 tons. Nearing the end of the 2013/14 marketing year, corn sales are 1.918 billion bushels, compared to 752.2 million late in 2012/13. Sales of 719,300 tons (28.3 million bushels) for 2014/15 delivery were mainly to Colombia (223,300 ton) and Mexico (193,600 tons).

Old crop soybeans had a net cancellation of 89,600 tons (-3.3 million bushels), with sales of 3,900 to 12,800 tons offset by cancellations from China (119,000 tons) and unknown destinations (8,700 tons). At this point in the marketing year, soybean sales are 1.694 billion bushels, compared to 1.366 billion this time last year. Sales of 1,420,600 tons (52.2 million bushels) for 2014/15 delivery were primarily to China (947,900 tons) and Spain (120,000 tons).

Soybean meal was pegged at 99,800 tons, up sharply on the week and 12% higher than the four week average. Unknown destinations bought 26,800 tons and Mexico purchased 26,100 tons. So far this marketing year, soybean meal sales are 10,403,800 tons, compared to 9,984,700 a year ago. Sales of 78,600 tons for 2014/15 delivery were mostly to Colombia (30,500 tons) and El Salvador (17,700 tons).

Soybean oil came out at 15,700 tons, considerably larger than both the week before and the four week average. Mexico picked up 10,100 tons and Nicaragua bought 3,300 tons. 2013/14 soybean oil sales are 821,600 tons, compared to 922,200 in 2012/13. Sales of 5,000 tons for 2014/15 delivery were to the Dominican Republic.

Net beef sales totaled 7,300 tons, a decline of 23% from the prior week and a drop of 41% from the four week average. The reported purchasers were Japan (1,700 tons), South Korea (1,400 tons), Canada (1,000 tons), Hong Kong (1,000 tons), and Mexico (900 tons). Sales of 600 tons for 2015 delivery were to Canada.

Net pork sales totaled 24,400 tons. The listed buyers were Mexico (10,300 tons), Japan (3,900 tons), South Korea (2,800 tons), Hong Kong (2,300 tons), and Canada (1,600 tons).

NRC studying genetically engineered crops

The National Academy of Sciences’ National Research Council (NRC) is conducting a two-year study of genetically engineered crops.  The NRC will look at the development and introduction of GE crops in the U.S. and globally.  Through a broad study of available information, the committee will “review the scientific foundation of current environmental and food safety assessments for GE crops and foods.”

They will assess the purported negative effects of the crops including the impact on farmers in developing countries and the evolution of so-called “super weeds”.  The study will also look at the purported positive effects including reduced pesticide use and soil conservation through reduced tillage

As part of the process, the NRC will conduct a public meeting in Washington D.C. in September to gather input from supporters and opponents of genetically engineered crops.

The study started last March; a report will be formulated and delivered to policymakers by the spring of 2016 “in the context of the world’s current and projected food and agricultural system.”  Derivatives of the report will also be made public.

The study is sponsored by the New Venture Fund, the Gordon and Betty Moore Foundation, the Burroughs Wellcome Fund, the U.S. Department of Agriculture, and the National Academy of Sciences.

 

The National Academy of Sciences (NAS) is a private, non-profit society of distinguished scholars. Established by an Act of Congress, signed by President Abraham Lincoln in 1863, the NAS is charged with providing independent, objective advice to the nation on matters related to science and technology. Scientists are elected by their peers to membership in the NAS for outstanding contributions to research.

 

The National Research Council, created under the NAS charter in 1916 by executive order of President Woodrow Wilson, extended the scope of the NAS in its advisory role.

Solid week for wheat inspections

USDA reports wheat export inspections for the week ending August 14 were above what’s needed weekly to meet USDA projections for the 2014/15 marketing year, but corn and wheat fell short of their respective marks for 2013/14. The 2014/15 marketing year for corn, soybeans, and sorghum starts September 1.

Wheat came out at 596,675 tons, up 45,398 from the week ending August 7, but down 325,578 from the week ending August 15, 2013. For the 2014/15 marketing year to date, wheat inspections are 5,181,328 tons, compared to 7,445,803 in 2013/14.

Corn was reported at 970,874 tons, 63,411 higher than the previous week and 788,886 more than this time last year. At this point in the 2013/14 marketing year, corn inspections are 44,847,927 tons, compared to 16,921,625 in 2012/13.

Soybeans were pegged at 56,210 tons, 42,700 lower than the week before and 87,813 less than a year ago. So far this marketing year, soybean inspections are 43,216,821 tons, compared to 35,608,151 last year.

Sorghum inspections totaled 163,102 tons. That’s a decrease of 155,012 tons on the week, but an increase of 138,247 on the year. 2013/14 sorghum inspections are 4,737,387 tons, compared to 1,728,418 in 2012/13.

Wisconsin ag exports at record pace

Wisconsin is on pace to have record agricultural exports this year.  The Department of Ag, Trade and Consumer Protection says in the first six months of 2014, we exported $1.9 billion in agricultural products to 128 countries.  That is a 17 percent increase over the first half of 2013.

Growth in dairy exports, including dairy derivatives, increased 30 percent compared to the first half of 2013 to $273 million. Wisconsin ranks first in the nation in the export of bovine genetics, whey, ginseng, processed sweet corn and mink fur skins. Wisconsin ranks second in the export of cheese and processed cranberries.

Canada is our best customer buying $934 million from the Badger State, up 17 percent from a year ago.  Mexico’s purchases are up 36 percent to $160 million.  China bought $157 million, Korea $101 million and Japan $77 million.

Total U.S. agricultural exports were valued at $88 billion, an increase of 12 percent compared to the same period in 2013.  Wisconsin ranks 12th in ag exports among the 50 states.