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AgDay Daily Recap -Aug 14, 2014

August 14, 2014
 
 

 

TODAY ON AGDAY:
AUGUST 14, 2014
 
OPEN HEADLINES:
COMING UP TODAY ON AGDAY - BEEF PRODUCERS THINK EXPANSION, BUT WHEN AND WHERE? A LEADING EXPERT SHARES HIS THOUGHTS.IN AGRIBUSINESS...A LOT OF PEOPLE THOUGHT 200 WASN'T POSSIBLE IN FEEDERS WE OVER SHOT THOSE BY SO MANY POINTS IT'S UNBELIEVABLE. DEERE FEELS THE SQUEEZE OF LOWER GRAIN PRICES. AUCTIONEERS BATTLE IT OUT IN THE HAWKEYE STATE. AGDAY BROUGHT TO YOU BY THE ALL NEW CHEVY SILVERADO - THE 2014 NORTH AMERICAN TRUCK OF THE YEAR.
CATTLE EXPANSION:
GOOD MORNING I'M BETSY JIBBEN IN FOR CLINTON GRIFFITHS. THE NATION HASN'T SEEN SUCH A SMALL BEEF COW HERD IN DECADES. AND WITH ENTICING CATTLE PRICES AT RECORD HIGHS, HOW LONG WILL IT TAKE TO RE-BUILD THE HERD? THAT'S OUR TOP STORY ON AGDAY.
CATTLE EXPANSION:
CATTLE PRODUCERS ARE TRYING TO REBUILD. BUT THE QUESTION IS, HOW LONG WILL IT TAKE? "I THINK THIS WILL START TO SLOW, GOING TO TAKE SEVEN TO 8 YEARS TO REBUILD… I THINK SIX TO EIGHT IN THE FUTURE," HURT SAYS EXPECT THE EXPANSION TO START IN THE NORTHERN PLAINS... A REGION WHERE BEEF COW NUMBERS DID NOT DECLINE OVER THE PAST SEVEN YEARS. "WE HAVE A LOT OF MARGINAL LAND IN THAT AREA AND LAND NOW THERE IS A PROFIT INCENTIVE IN THAT AREA SO WE SEE THAT SHIFTING," HE SAYS THE MAIN TRANSITION IS TURNING THAT CORN BACK INTO PASTURE. SOMETHING THAT WILL TAKE MULTIPLE YEARS... "I THINK OVERTIME WE WILL HEAR TALK, NOT A VAST, BUT SOME THAT SHIFTS OUT OF CROPS INTO PASTURE LAND." HURT SAYS THE WESTERN CORN BELT FROM MINNESOTA TO MISSOURI LOST 566-THOUSAND COWS, WHICH IS 15-PERCENT OF THE NATIONAL REDUCTION. IT HAS A GOOD CHANCE OF REBUILDING, BUT CHALLENGE THERE IS CONVINCING PRODUCERS TO GO BACK TO CATTLE AFTER TURNING TO GRAIN PRODUCTION IN THE ETHANOL BUSINESS. "MANY IN IOWA AND MINNESOTA HAVE USED TO HAULING TO ETHANOL PLANT AND HARDER TO CONVINCE BACK TO CATTLE BECAUSE THEY'RE USED TO CASH GRAIN PRODUCTION BUSINESS," A THIRD AREA PRIME FOR EXPANSION IS THE SOUTH EAST. THE REGION TOOK A 21-PERCENT HIT OF THE NATION'S TOTAL. "WHAT WE WILL SEE THERE IS A RETURN OF PASTURES. THAT AREA IS IN GOOD SHAPE IN REGARD TO MORE MOISTURE. WE WILL SEE EXPANSION IN SOUTH EAST." BUT THE MAIN CONCERN IS THE SOUTHERN PLAINS, WHICH ACCUMULATED 1.6 MILLION OF THE DECLINE. TEXAS ALONE HAD THE BIGGEST REDUCTION OF 1.4 MILLION HEAD, 26-PERCENT OF THE NATION'S TOTAL DECLINE. HURT SAYS THE SOUTHERN PLAINS NEEDS TO GET OUT OF DROUGHT BEFORE THEY CAN EVEN EXPAND. "EASTERN TEXAS IS A PROMINENT AREA. PROBABLY GOING TO SEE SOME EXPANSION THERE... CENTRAL AND WESTERN TEXAS IS DROUGHT. PROBABLY WON'T SEE EXPANSION IN THOSE AREAS." EXPECT A SLOW EXPANSION IN THE PACIFIC NORTHWEST TOO. "IN CALIFORNIA WE ARE CONTINUING TO SEE DROUGHT. THE STATE HAS 2 PERCENT OF THE BEEF COWS IN THE US,"
REBUILDING HERDS:
THOSE TIGHT CATTLE SUPPLIES ARE ALSO IMPACTING BEEF PACKING PLANTS AROUND THE NATION. IN JUST THE PAST TWO WEEKS, TWO PLANTS HAVE SHUT THEIR DOORS:
CARGILL CLOSED A PACKING PLANT IN MILWAUKEE, WISCONSIN AND L& H PACKING CLOSED IN SAN ANTONIO, TEXAS. IN APRIL OF THIS YEAR, NATIONAL BEEF CLOSED ITS DOORS IN BRAWLEY, CALIFORNIA. IN FEBRUARY 2013, CARGILL CLOSED ITS PLANT IN PLAINVIEW, TEXAS.
MEAT PRODUCTION:
WHILE HERD NUMBERS ARE DOWN, PRODUCERS ARE GROWING HEAVIER CATTLE. USDA'S SUPPLY AND DEMAND REPORT SAYS IT'S NOT ONLY BEEF, BUT PORK AND POULTRY PRODUCERS WHO ARE FEEDING LONGER TO PUSH-UP PRODUCTION LEVELS. USDA EXPECTS THIS TO HOLD THROUGH 2015.
AVMA SOW HOUSING:
THE AMERICAN VETERINARY MEDICAL ASSOCIATION'S HOUSE OF DELEGATES PASSED AN AMENDMENT TO ITS POLICY IN AN EFFORT TO MAKE BIRTHING CONDITIONS LESS STRESSFUL FOR SOWS.
PNW STRIKE:
A BITTER TWO YEAR LABOR STRIKE AT GRAIN TERMINALS IN THE PACIFIC NORTHWEST APPEARS TO BE RESOLVED. THIS SHOULD EASE FEARS OF DELAYED GRAIN EXPORTS AS THE COUNTRY RACES TOWARDS HARVEST. MORE THAN A QUARTER OF ALL U-S GRAIN EXPORTS GO THROUGH NINE TERINALS IN WASHINGTON STATE. THE UNION REPRESENTING LONG-SHOREMAN HAVE REACHED A TENTATIVE AGREEMENT WITH THE GRAIN COMPANY OWNERS. THE UNION WORKERS MUST STILL APPROVE THE DEAL. A FEDERAL MEDIATOR WAS CALLED IN TO RESOLVE THE DISPUTE WHICH BEGAN IN SEPTEMBER 2012.
MATT ROBERTS:
A DOWN DAY IN THE SOYBEAN MARKET, AS AUGUST BEANS CLOSED DOWN ANOTHER 25 CENTS ON TOP OF YESTERDAY'S SIMILAR LOSS. TUESDAY'S LOSS COULD BE EXPLAINED BY USDA'S CROP PRODUCTION REPORT WHICH SHOWS A 16-PERCENT INCREASE OVER LAST YEAR. THE AG DEPARTMENT SAYS IF THIS BEAN CROP MAKES IT THROUGH WITHOUT PRODUCTION PROBLEMS, IT WOULD BE A RECORD. OHIO STATE AG ECONOMIST MATT ROBERTS SAY THAT'S NOT HELPING PRICE ANY.
TEASE:
STILL TO COME, FARM DIRECTOR AL PELL WILL BE HERE AS WE CONTINUE OUR DISCUSSION ABOUT LIVESTOCK MARKETS. PLUS A HUGE RANCH IS FOR SALE FOR TEXAS. AND THE ASKING PRICE MATCHES THE SIZE OF THE ACRES.
RANCH FOR SALE:
IN AGRIBUSINESS...ARE CONDITIONS RIGHT FOR A BIG SALE IN TEXAS? ONE OF THE NATION'S LARGEST RANCHES IS NOW UP FOR GRABS. THE 510-THOUSAND ACRE WAGGONER RANCH STRETCHES ACROSS 6 NORTHERN TEXAS COUNTIES..IT'S THE LARGEST CONTIGUOUS RANCH IN THE U.S. THE PROPERTY INCLUDES TWO MAIN COMPOUNDS,
HUNDREDS OF HOMES, THOUSANDS OF CATTLE, 12-HUNDRED OIL WELLS AND 30-THOUSAND ACRES OF CROPLAND. THE OUTFIT ESTABLISHED IN 1923 IS LISTED FOR A COOL 725 MILLION DOLLARS. THE LISTING AGENTS SAY ITS ALREADY GETTING ATTENTION FROM INTERESTED BUYERS.
OIL GLUT:
RUSSIA MAY BE CONCENTRATING ON ITS SANCTIONS OF AG GOODS BUT FALLING OIL PRICES COULD BE A BIGGER CONCERN. OIL PRICE NOW AT A NINE MONTH LOW ON GROWING SUPPLIES FROM OPEC AND THE U-S... THE INTERNATIONAL ENERGY AGENCY IS WARNING ABOUT THE POSSIBILITY OF AN OIL GLUT. BRENT CRUDE NOW AT IT LOWEST PRICE OF THE YEAR...
JD LOWERS FORECAST:
 DECLINING GRAIN PRICES ARE BEING FELT AT THE WORLD'S LARGEST EQUIPMENT MAKER. IN ITS QUARTER-LY EARNINGS REPORT DEERE EXPECTS TO EARN THREE-POINT-ONE-BILLION IN FISCAL 2014, DOWN FROM A PREVIOUS FORECAST OF THREE-POINT-THREE BILLION.
FARMERS ARE FEELING DISCOURAGED ABOUT BUYING TRACTORS AND COMBINES WITH GRAIN PRICES AT THE CURRENT LEVEL. HOWEVER, WITH THOSE LOWER GRAIN PRICES, DEERE SAYS DEMAND BY THE LIVESTOCK SECTOR FOR SMALLER TRACTORS IS HELPING TO OFFSET THE WEAKNESS FROM THE GRAINS SECTOR.
ANALYSIS INTRO:
IN THIS MORNING'S ANALYSIS, WE'LL STICK WITH THE LIVESTOCK MARKET. FARM DIRECTOR AL PELL PICKS-UP THE CONVERSTION, AL.
ANALYSIS:
JOE VACLAVIK FROM STANDARD GRAIN IS OUR GUEST HERE LET'S TALK A LITTLE BIT ABOUT THE CATTLE MARKET AND WERE PROBABLY GOING TO TALK ABOUT THE CATTLE MARKET WE CAN TALK ABOUT THE HOG MARKET AND I SUPPOSE WE CAN ALSO TALK ABOUT CHICKEN MARKET AND THEN MIGHT EVEN BRING UP RUSSIA AND UKRAINE BECAUSE THEIR AFFECTING ALL THOSE MARKETS RIGHT NOW. WELL WE'VE SEEN A BIG SELL OFF IN THE CATTLE MARKET AND ALSO THE HOG MARKET THIS IS A STORY WHERE WE DID HAVE A VERY SOLID FUNDAMENTAL BULLISH STORY IN THE CATTLE MARKET AND ALSO IN THE HOG MARKET THAT STORY IS ONGOING I THINK THE SITUATION HERE. BOTH FEWER CATTLE AND FEWER HOGS PRICES WENT UP. NUMBERS ARE DOWN BY SEVERAL PERCENTAGE POINTS THAT'S SOMETHING THAT THIS MARKET HAS BEEN PRICING IN FOR MONTH NOW, BUT DID THEY GO TO HIGH. THEY MAY HAVE THEY MAY HAVE AND WERE STARTING TO SEE THE IMPACT OF HIGHER PRICES WE'VE NOT NECESSARILY BUILT OUR SUPPLIES A WHOLE LOT WE MIGHT BE GETTING INTO A SEASONAL TIME FRAME WHERE DEMAND FOR BEEF AND PORK MIGHT BACK OFF MAYBE THE TRADE BELIEVES THAT THIS PED VIRUS IN THE HOGS ISN'T AS BAD AS WE THOUGHT OR THAT THERE'S SOME SOLUTION ON THE HORIZON WHAT THIS GOES BACK TO IS IS WHAT ANY OF THESE BIG TIME BULL MARKETS DO THEY CORRECT AND THERE DOESN'T NECESSARILY NEED TO BE A GREAT FUNDAMENTAL REASON WHY IN THE MARKETS THESE DAYS AS MUCH AS EVER IT'S CONTROLLED BY MONEY FLOW AND OUTSIDE MONEY IN A LOT OF INSTANCES SO DON'T RULE OUT SOME REALLY BIG DOWNSIDE IN THESE IN THESE LIVESTOCK MARKETS IF THE RIGHT THINGS HAPPEN IT'S THE RISK IS OUT THERE SO IF YOU'RE A LIVESTOCK PRODUCER MAKE SURE YOU GOT YOUR BASIS COVERED THIS MARKET RAN A LOT HIGHER THAN ANYBODY WOULD HAVE EVER GUESSED IN THE IN THE FAT CATTLE AND FEEDER CATTLE MARKET IN PARTICULAR BACK JUST A FEW MONTHS THOUGH A LOT OF PEOPLE THOUGHT 150 WASN'T POSSIBLE IN FATS A LOT OF PEOPLE THOUGH 200 WASN'T POSSIBLE IN FEEDERS WE OVER SHOT THOSE BY BY SO MANY POINT IT'S UNBELIEVABLE SO DON'T THINK THAT THE MOVE TO THE DOWNSIDE COULDN'T BE EQUALLY AS ENORMOUS IN MY OPINION. YEA OUTSIDE MARKETS ACTUALLY MAKE A DIFFERENCE SOME GUYS ARE TELLING ME THAT YOU NEED TO WATCH WHAT'S GOING ON THE OUTSIDE MARKETS BECAUSE THAT CAN TELL YOU IN SOME OF THE AGRICULTURE MARKETS PARTICULARLY LIVESTOCK WHAT'S GOING TO HAPPEN. IT COULD WE'VE SEEN THE STOCK MARKET BACK OFF RECENTLY AND THAT'S THE ONE FACTOR THAT SOME PEOPLE ARE TALKING ABOUT TO BE HONEST WITH YOU I THINK IT'S OF LITTLE CONSEQUENCE I THINK THIS LIVESTOCK MARKET HAS A MIND OF IT'S OWN I THINK THE CATTLE AND THE FEEDER CATTLE JUST GOT INTO A SITUATION WHERE HIGH PRICES CURED HIGH PRICES HERE FOR THE MOMENT AND I'LL LEAVE IT AT THAT I DON'T THINK YOU NEED READ INTO THE STOCK MARKET OR RUSSIA OR ANYTHING ELSE. OKAY THANK YOU VERY MUCH JOE VACLAVIK HERE AT AGDAY BACK WITH MORE IN A MOMENT. )
WX:
AND WELCOME BACK TO AGDAY, WE'RE LOOKING AT A FRONTAL SYSTEM ACROSS THE MIDDLE OF THE CORN BELT, BUT IT HAS ALMOST NO MOISTURE ALONG IT. MOST OF THE MOISTURE IS ALONG THIS FRONT IN THE GULF, AND ACROSS FLORIDA WHERE LOTS OF THUNDERSTORMS AND SHOWERS WILL BE LOCATED, AND WE HAVE A LOT OF MOISTURE STILL AROUND THIS AREA OF LOW PRESSURE, NORTHEAST OF THE GREAT LAKES. SO THE EASTERN LAKES AND THE NORTHEASTERN PARTS OF THE COUNTRY ARE GOING TO GET SOME DECENT MOISTURE FROM THAT. AND YOU CAN JUST SEE THIS PLUM OF MOISTURE UP AND DOWN THE SPINE OF THE ROCKIES, WITH SOME CLOUDS IN PLACES AND ALSO SCATTERED MAINLY AFTERNOON SHOWERS AND THUNDERSTORMS DEVELOPING THERE. PUTTING THE MAPS INTO MOTION, YOU CAN SEE THERE MAY BE A FEW SHOWERS ALONG THIS COOL FRONT AS IT MOVES ACROSS THE OHIO RIVER, BUT MOST AREAS EVEN IN THAT SECTION IS GOING TO STAY DRY, AS HIGH PRESSURE JUST DOMINATES. THIS ONE SLIGHTLY COOLER THAN THE ONE THAT CAME INTO THE SOUTHEAST, BRINGING VERY COOL CONDITIONS ALL THE WAY DOWN THE GULF COAST. THIS ONE WILL NOT, THE NEXT COLD FRONT I SHOULD SAY, WILL NOT REACH THE GULF COAST AS IT WILL STALL OUT RIGHT THROUGH THE TENNESSEE VALLEY OVER THE NEXT COUPLE OF DAYS. SO AS WE HEAD THROUGH THE DAY TOMORROW YOU CAN SEE SOME MORNING SHOWERS AND THUNDERSTORMS IN PARTS OF THE NORTHERN PLAINS, A LITTLE BIT OF HIT AND MISS ACTIVITY IN FLORIDA AND A REMINISCE OF THAT STORM SYSTEM STILL SPINNING THROUGH NEW ENGLAND, THAT WILL CONTINUE THROUGH THE AFTERNOON AS WELL. BUT THIS SYSTEM WILL START TO GET A LITTLE BIT MORE ACTIVITY ALONG IT, WITH SHOWERS AND THUNDERSTORMS DEVELOPING WESTERN LAKES, ALL THE WAY DOWN INTO THE CENTRAL PLAINS, ESPECIALLY BACK INTO THE FOUR CORNER REGION, ALSO THIS AREA OF LOW PRESSURE KIND OF STAGNANT OVER THE NORTHWEST, GIVING SOME MOISTURE TO PARTS OF WASHINGTON, OREGON, AND NORTHERN IDAHO. YOU CAN SEE THAT ON THE PAST TWO DAYS WE'VE SEEN SOME DECENT AMOUNTS OF MOISTURE ESPECIALLY FLORIDA, THE NORTHEAST, ADDING ON THE NEXT 36 HOURS YOU CAN SEE VERY LITTLE THROUGH THE HEART OF THE COUNTRY, BUT WESTERN STATES, WESTERN PLAINS GETTING SOME MOISTURE, AND WE WILL SEE A LITTLE BIT THROUGH THE NORTHERN PLAINS AS WELL AS THE WESTERN GREAT LAKES AS WE HEAD INTO THE DAY TOMORROW AND TOMORROW NIGHT. THERE ARE THE TEMPERATURES, EVEN THOUGH THIS IS HOT WITH THE 90'S, ITS NOT AS HOT AS TYPICAL ANYWHERE EAST OF THE ROCKIES. THESE ARE ALL COOLER THAN NORMAL NUMBERS, HIGH TEMPERATURES IN THE 60S IN PARTS OF THE NORTH EAST AND EASTERN GREAT LAKES TODAY, LOWS TONIGHT GOING TO BE IN THE 50S IN A HUGE AREA ACROSS THE GREAT LAKES, OHIO VALLEY INTO THE NORTH EAST, 60S ALL THE WAY DOWN INTO NORTHERN AND CENTRAL DIXIE, WHICH IS AMAZING AS WELL. HIGH TEMPERATURES TOMORROW THEN PRETTY MUCH THE SAME, HOT IN THE SOUTHERN PLAINS BUT STILL NOT A TYPICAL FOR THIS TYPE OF THE YEAR. THERES THE BIG TROUGH OVER THE NORTHEASTERN PART OF THE GREAT LAKES INTO NEW ENGLAND, THAT KIND OF SITS THERE AND HAVING TROUBLE MOVING AWAY, WE SEE LITTLE PIECES OF TROUGHS MOVING SOUTH EASTWARD AS WE HEAD THROUGH NEXT WEEK, BUT IT WILL TURN A LITTLE BIT WARMER NEXT WEEK. THAT'S A LOOK ACROSS THE COUNTRY NOW LETS TAKE A LOOK AT SOME LOCAL FORECASTS. PRESCOTT ARIZONA, A MIX OF CLOUDS AND SUNSHINE, MAYBE AN AFTERNOON THUNDERSTORM, HIGH TEMPERATURE OF EIGHTY TWO TODAY, CARRINGTON NORTH DAKOTA PARTLY SUNNY AND WARM WITH A HIGH OF 86, AND FINALLY MERIDIAN MISSISSIPPI WARM BUT NOT TO HUMID WARM WITH A HIGH OF 91.
ITC AUCTION:
FARMERS LIKE A GOOD AUCTION. OF COURSE HAVING A QUALITY AUCTIONEER HELPS TO 'MAKE' THE EVENT. THIS WEEK AT THE IOWA STATE FAIR, SOME OF THE FAST-TALKERS BATTLED IT OUT FOR TOP PRIZES. SUZANNE GAFFNEY HAS OUR STORY FROM DES MOINES.
BETTER AVOCADO:
MANY OF US ENJOY SLICES OF AVOCADO ON OUR DELI SANDWICHES OR MUSHED INTO GUACAMOLE. BUT THERE ARE ALSO HEALTH BENEFITS. AND NOW RESEARCHERS AT OHIO STATE SAY THOSE BENEFITS CAN BE ENHANCED EVEN FURTHER. THE TYPE OF FAT IN AVOCADOES HELPS THE BODY ABSORB BAY-TUH-CARE-OH-TEEN, BUT IT ALSO HELPS CONVERT THEM TO VITAMIN A. IN A NEW STUDY THE BUCKEYE STATE SCIENTISTS SAY THE BODY FORMED 12 TIMES MORE VITAMIN A FROM CARROTS WHEN EATEN WITH AVOCADOES. LIKEWISE, THE VITAMIN A VALUE FOR TOMATOES INCREASED FOUR TIMES WITH AVOCADOES.
CLOSE:
CLINTON…THAT'S ALL THE TIME WE HAVE THIS MORNING. WE'RE GLAD YOU TUNED IN.
RFD PROMO:
COMING UP THURSDAY ON AGDAY - WE'LL TALK WITH A LEADING AG ECONOMIST ABOUT REBUILDING THE NATION'S BEEF HERD. WHEN AND WHERE WILL IT HAPPEN? PLUS, A MASSIVE RANCH WITH A PRICETAG TO MATCH… I'M BETSY JIBBEN. WATCH AGDAY AT EIGHT EASTERN ON R-F-D.

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