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USFR Weekly Recap - May 17-18, 2014

May 17, 2014

                                                                                                                                                                                          

THIS WEEK ON U.S. FARM REPORT

EPISODE # 2127

MAY 17-18, 2014   

 

 

JOHN’S OPEN:

HELLO AND WELCOME TO U-S FARM REPORT, I'M JOHN PHIPPS. YOU THINK GROWING CORN AND SOY AND WHEAT HAS BEEN GOOD BUSINESS THE LAST FEW YEARS, YOU DON'T KNOW THE HALF OF IT. THANKS TO AMERICAN TONGUES FINALLY REALIZING LIGHT BEER TASTES LIKE DISHWATER, THE DEMAND FOR BEER WITH FLAVOR HAS MADE HOP FARMING ONE OF THE HOTTEST SECTORS OF OUR INDUSTRY. AS MORE BEER CONSUMERS OPT FOR CRAFT BEERS, ESPECIALLY INDIA PALE ALES, THE NUMBER OF HOP FARMS HAS MORE THAN DOUBLED FROM 68 IN 2007 TO 167 IN 2012. MEANWHILE THE PRICE HAS MORE THAN DOUBLED. UNFORTUNATELY, HOPS DON'T GROW WELL IN ILLINOIS.

HEADLINES:

WE HEARD WARNINGS LAST YEAR OF A LAND BUBBLE AND HOW THE HIGH PRICES COULDN'T LAST.  WELL, LAND REPORTS FROM THREE MAJOR REGIONS CAME OUT this WEEK SHOWING LAND VALUES BACKING OFF A LITTLE AND STABILIZING, BUT NOT CRASHING LIKE SOME EXPECTED. THE LATEST USDA CROP PROGRESS REPORT CONFIRMS WHAT JOHN TALKED ABOUT LAST WEEK-- FARMERS WERE BUSY IN THE FIELDS MAKING HUGE STRIDES IN PLANTING.  THE AGENCY SAYS 59 PERCENT OF THE CORN CROP IS NOW PLANTED. THAT'S A 30 POINT JUMP IN ONE WEEK, AND NOW AHEAD OF the 5-YEAR AVERAGE. SOYBEANS ARE 20 PERCENT PLANTED, UP 15 POINTS FROM THE PREVIOUS WEEK, AND ONLY 1 POINT BEHIND AVERAGE.  AND COTTON SITS AT 30 PERCENT COMPLETE. THAT'S 14 POINTS HIGHER THAN THE WEEK PRIOR AND ONLY 4 POINTS BEHIND AVERAGE. JOHN DEERE'S EARNING THIS WEEK SHOW A OUTLOOK FOR THE REMAINDER OF THE YEAR. THE COMPANY'S SECOND QUARTER REVENUE FELL 9 AND A HALF PERCENT, DUE TO SLOWING EQUIPMENT PURCHASES. THE MANUFACTUER SAYS AMONG THE BARRIERS FOR INCREASING SALES IS THE CRISIS IN UKRAINE. DEERE TOOK ANOTHER HIT IN TRACTOR AND HARVESTER SALES, DOWN 12 PERCENT ON THE QUARTER. MEANWHILE, SMITHFIELD FOODS' EARNINGS SHOWED A MUCH BRIGHTER PICTURE. THE COMPANY'S NET INCOME SKYROCKETED NEARLY 500 PERCENT HITTING A FIRST-QUARTER RECORD OF 105 MILLION DOLLARS. AND OPERATING PROFIT TRIPLED. THE COMPANY SAYS THE FEAR OF P-E-D-V HURTING MEAT SUPPLIES CAUSED PORK PRICES TO RISE. GOOD NEWS FOR SOYBEAN SHIPMENTS TO CHINA.  THE BIGGEST CHINESE SOYBEAN BUYER SANDONG SUNRISE GROUP SAYS IT WON'T DEFAULT ON SOYBEAN CONTRACTS. INSTEAD, IT WILL TAKE A LOSS. THE COMPANY SAYS THIS IS TO PROTECT ITS RELATIONSHIP WITH SUPPLIERS. SUNRISE ACCOUNTS FOR 12 PERCENT OF ALL SOY IMPORTS INTO CHINA.

CROP WATCH:

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