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USFR Weekly Recap - November 13-14, 2010

November 15, 2010

THIS WEEK ON U.S. FARM REPORT
EPISODE #1944
NOVEMBER 13-14, 2010

JOHN’S OPEN: HELLO AND WELCOME TO U.S. FARM REPORT, I'M JOHN PHIPPS. IF THERE IS ANY DOUBT ABOUT THE IMPORTANCE OF THE CHINESE ECONOMY TO U.S. PRODUCERS THIS WEEK SHOULD ERASE THEM. AFTER THE SOYBEAN SURPRISE AND THE CONTINUED DETERIORATION OF CORN PRODUCTION ESTIMATES, PRICES LEAPT UPWARD ONLY TO BE SMACKED DOWN BY HINTS OF AN INTEREST RATE INCREASE IN CHINA.  THESE ARE FLEETING MARKET REACTIONS OF COURSE, BUT THE NEARLY 10% GROWTH RATE FOR CHINA'S GDP IS RAPIDLY BECOMING THE ENGINE OF THE GLOBAL ECONOMY. AND IT’S OVERDUE. THE RISE OF 1.3 BILLION PEOPLE FROM POVERTY TO IMPROVING STANDARDS OF LIVING IS AN INDICATOR OF GROWING FREEDOM AND ECONOMIC POSSIBILITIES TOO LONG DENIED THEM. LET'S CHECK THE HEADLINES.....HERE'S AL PELL

SOYBEAN CROP: THANK YOU JOHN. SOYBEAN PRICES SOARED TUESDAY AFTER USDA CUT ITS CROP ESTIMATE - A BIG SURPRISE IN THE PITS. AT THE SAME TIME, THE AG DEPARTMENT ALSO CUT ITS ENDING STOCKS FIGURE. USDA PEGS SOYBEAN PRODUCTION AT NEARLY THREE-POINT-FOUR BILLION BUSHELS ON AVERAGE YIELDS OF JUST UNDER 44-BUSHELS AN ACRE...BOTH DOWN FROM A MONTH AGO. TWO-BUSHEL-PER ACRE REDUCTIONS WERE REGISTERED IN KANSAS, NEBRASKA AND SOUTH DAKOTA. THE REPORT ALSO CALLS FOR RECORD YIELDS IN ILLINOIS, LOUISIANA, NEW YORK AND WISCONSIN. WHAT TRADERS WERE NOT EXPECTING WAS THE BIG CUT IN CARRYOVER.

CORN CROP:  AS FAR AS CORN, THE AG DEPARTMENT IS EXPECTING 12.5 BILLION BUSHELS BASED ON AVERAGE YIELDS OF JUST OVER 154-BUSHELS AN ACRE. THAT'S A REDUCTION OF ONE-AND-A-HALF BUSHELS FROM THE OCTOBER FORECAST. USDA ALSO CUT ENDING STOCKS BY 75 MILLION BUSHELS, PUTTING CORN CARRYOVER AT 827-MILLION BUSHELS.

GLOBAL COTTON:  MEANWHILE, COTTON CONTINUES ITS METEORIC RISE AFTER USDA LOWERED ITS FORECAST OF BOTH THE U.S. AND GLOBAL COTTON SUPPLY.  USDA LOWERED ITS YIELD ESTIMATES FOR THE 2010 COTTON CROP BY NEARLY A HALF MILLION BALES, OR ABOUT 2%. THE AG DEPARTMENT PEGS COTTON PRODUCTION AT 18-POINT-FOUR MILLION BALES. THE REDUCTION IS DUE TO LOWER YIELDS IN TEXAS. MEANWHILE, THE ESTIMATED WORLD COTTON PRODUCTION AND WORLD ENDING STOCKS WERE ALSO LOWERED.

ROUNDTABLE: JUSTIN KELLY OF EHEDGER AND JIM BOWER OF BOWER TRADING INC.

JOHN’S WORLD: DURING HIS ASIA TRIP, PRESIDENT OBAMA TOOK A FIRM STAND IN SUPPORT OF U.S. CATTLEMEN AND OUR BEEF INDUSTRY. HE ALSO PRESSED FOR FREER ACCESS TO THE SOUTH KOREAN AUTO MARKET. AT THE G20 MEETING, HE DEFENDED THE U.S. ACTION TO ENCOURAGE GROWTH AT HOME. THE RESULT OF THESE ACTIONS WERE STALEMATES ON A SOUTH KOREAN TRADE AGREEMENT AND TEMPORIZING FROM WORLD LEADERS ABOUT FUTURE GROWTH. THE CORE OF THIS ISSUE IS THE REFUSAL OF MANY COUNTRIES TO ACCEPT THE FACT THE U.S. WILL NO LONGER BE ABLE OR WILLING TO ACT AS THE MARKET OF LAST RESORT. YEARS OF WIDE TRADE IMBALANCES FUELED BY COMPARATIVELY OPEN AMERICAN CONSUMER MARKETS FOR EVERYTHING FROM TOYS TO MACHINE TOOLS IS CHANGING. AS OUR DOLLAR DROPS, IMPORTS WILL BECOME MORE EXPENSIVE AND OUR PRODUCTS BECOME MORE ATTRACTIVE OVERSEAS. CERTAINLY AG PRODUCERS WELCOME THIS REVALUATION. BUT READING BETWEEN THE LINES IT BECOMES OBVIOUS FOR THE TALK ABOUT CHINA AND INDIA BEING THE NEW ENGINES OF CONSUMPTION, IT HASN'T SUNK IN OUTSIDE THE U.S. SELLING TO US WAS JUST SO EASY FOR SO LONG. EAGER CONSUMERS, POWERFUL FINANCIAL TOOLS, AND ROBUST SHIPPING SYSTEMS MADE AMERICA THE MARKET OF CHOICE. NOT UNLIKE CHILDREN SELLING CANDY FOR A FUND-RAISER, MERCHANTS AROUND THE GLOBE WILL HAVE TO LEARN THE RICH OLD GUY DOWN THE BLOCK IS NO LONGER THE AUTOMATIC ANSWER TO THEIR MARKETING PROBLEM.

2ND HALF:
JOHN’S OPEN:
HELLO AND WELCOME TO U.S. FARM REPORT, I'M JOHN PHIPPS. THE FIRST PRELIMINARY REPORT FROM THE PRESIDENTIAL DEFICIT COMMISSION WAS ALL THE TALK IN POLITICAL CIRCLES THIS WEEK. MY IMPRESSION WAS THAT ANY PLAN THAT COULD INFURIATE BOTH THE LEFT AND THE RIGHT WAS PROBABLY A GOOD START, SINCE GETTING A GRIP ON OUR BUDGET PROBLEM WILL NECESSARILY INVOLVE GORING ALL OUR OXEN. BUT FOR FARMERS OF THE SACRED SEVEN SUBSIDY CROPS IT SHOULD BE NOTED THAT I HAVE SEEN NO BUDGET BLUEPRINT FROM ANY CORNER THAT DOES NOT INCLUDE MASSIVE FARM PROGRAM REDUCTIONS. WHILE DEFENDERS DISMISS THIS THREAT, THEY SHOULD LOOK AROUND AND SEE HOW MANY LONGTIME AG SUBSIDY SUPPORTERS WON'T BE AROUND SOON. LET'S GET STARTED WITH THE HEADLINES AND AL PELL....

DAIRY CONFERENCE: THANK YOU JOHN. WHEN THE GLOBAL ECONOMY TOOK A DIVE, U.S. DAIRY EXPORTS DID THE SAME. AS A RESULT, THE PAST TWO YEARS HAVE BEEN A FINANCIAL DISASTER ON MANY FARMS.  MANY OF THE TOP DAIRY PRODUCERS IN THE COUNTRY GATHERED THIS WEEK IN LAS VEGAS FOR DAIRY TODAY'S ELITE PRODUCER BUSINESS CONFERENCE. WITH THE ECONOMIC DOWNTURN, STRUGGLING EXPORTS AND HIGHER FEED COSTS, PRODUCERS ARE LOOKING FOR HELP. SWANSON SAYS TOO OFTEN, PRODUCERS RELY ON MARKETING "EXPERTS". HE SAYS PRODUCERS MUST TAKE FULL OWNERSHIP TO EVERY PART OF THEIR BUSINESS.

E15 LAWSUIT: THE EPA'S DECISION TO ALLOW FOR A HIGHER BLEND OF ETHANOL IS NOW FACING A LAWSUIT FROM A COALITION OF FARM AND FOOD ORGANIZATIONS. LAST MONTH'S DECISION CLEARED THE WAY FOR FUEL COMPANIES TO INCREASE ETHANOL CONTENT TO 15% FOR CARS BUILT SINCE 2006. THE COALITION CLAIMS THE EPA HAS OVER-STEPPED ITS BOUNDS AND THE DECISION WILL COST AMERICANS AT THE GROCERY STORE. THERE ARE EIGHT ORGANIZATIONS BEHIND THE SUIT...INCLUDING THE GROCERY MANUFACTURERS ASSOCIATION AND THE NATIONAL PORK PRODUCERS COUNCIL.

ULTIMATE FARM QUEST: WITH CROPS OUT OF THE FIELD, THE PRODUCERS TAKING PART IN THE ULTIMATE FARM QUEST ARE GETTING A CHANCE TO REVIEW SOME OF THEIR GOALS THEY SET FOR THIS YEAR. ONE OF THE GOALS SET BY MICHIGAN FARMER LEON KNIRK WAS TO CONTINUE IMPROVING HIS SOIL AGRONOMICS. LOCATED IN THE SOUTH-CENTRAL PART OF THE STATE, SOME OF LEON'S FIELDS CAN HAVE FIVE OR SIX DIFFERENT TYPES OF SOIL. THAT ALONE CAN CREATE UNIQUE CHALLENGES. AND THEN, THERE'S THE RAW NUMBERS GENERATED BY YIELD MAPS AND MANAGEMENT ZONES.

HEARTLAND MO BIRDS: BIRD LOVERS LISTEN UP - RESEARCHERS ARE NOW TAKING A "BIRDS-EYE" VIEW TO BETTER UNDERSTAND THE BEHAVIOR OF OUR FLYING FRIENDS. IN THIS REPORT FROM THE UNIVERSITY OF MISSOURI, KENT FADDIS HEADS TO THE FOREST TO FIND OUT WHAT THEY'RE LEARNING. RESEARCHERS SAY THEY CHOSE TO STUDY THE RED-BELLIED WOODPECKER BECAUSE THE BIRD LIVES IN THE SAME AREA YEAR-ROUND AND IS VERY LOYAL TO SPECIFIC SITES.

UPSTREAM HERO: NUTRIENT MANAGEMENT IS A PHRASE YOU HEAR A LOT THESE DAYS ON THE FARM...AN EFFORT TO KEEP NUTRIENTS IN THE FIELD AND OUT OF RUNOFF AND WATERWAYS. TO THAT END, THE CONSERVATION TECHNOLOGY INFORMATION CENTER IS ON THE LOOK-OUT FOR WHAT IT CALLS "UPSTREAM HEROES". AS CLINTON GRIFFITHS REPORTS, TWO OF THE FIRST NOMINATIONS ARE A FATHER AND SON DUO FROM CENTRAL ILLINOIS. YOU CAN READ MORE ABOUT THE UPSTREAM HEROES PROJECT IN THIS MONTH'S ISSUE OF FARM JOURNAL MAGAZINE OR GO ONLINE TO WWW.UPSTREAMHEROES.ORG . WHEN WE COME BACK, IT'S TIME FOR TRACTOR TALES AND OUR COUNTRY CHURCH SALUTE...PLEASE STAY WITH US.

TRACTOR TALES: STRAIGHT FROM A MONTGOMERY WARDS CATALOG, THIS WEEK'S TRACTOR TALES FEATURES A ONE-OF-A-KIND ANTIQUE.

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