' /> Chip's Chore Time | Dairy Today

 
Sep 2, 2014
Home| Tools| Events| Blogs| Discussions| Sign UpLogin


January 2009 Archive for Chip's Chore Time

RSS By: Chip Flory, Pro Farmer

Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm. In fact... I don't even have horse chores to do any more!

ACRE and SURE Webinars

Jan 30, 2009
Chip Flory

 

Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm, but taking care of two horses in the morning before I head in for work gives me a little time to think about the day ahead. Each morning, stop at this spot to get a feeling for the "tone of the day" - and some attitude about agriculture and the markets.

I was thinking…

... about gearing up for ACRE and SURE discussions.

Yes, we're still waiting for the details of exactly how USDA's new ACRE and SURE programs will be implemented. But, there's enough information about how payments will be triggered, how benchmarks will be established and the level of potential payments already available. We diagrammed ACRE in the Jan. 24 Pro Farmer newsletter, which started the flow of questions about the new farm program safety net.

Iowa State University Farm & Ag Business Management Specialist Steve Johnson is a long-time Pro Farmer friend. He has put together an excellent, 40-minute webinar on ACRE and SURE. To view it, click here.

Another ACRE and SURE webinar opportunity is coming up Monday night. The Iowa Farm Bureau and Iowa Corn Growers Association is sponsoring a live webcast on Feb. 2 at 7:00 p.m. CT. Click here for the link to get you connected to this live event.

Let's watch these events and then start a discussion about concerns and opportunities generated by ACRE and SURE.

Short Supply of Argentine Corn

Jan 27, 2009
Chip Flory

 

Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm, but taking care of two horses in the morning before I head in for work gives me a little time to think about the day ahead. Each morning, stop at this spot to get a feeling for the "tone of the day" - and some attitude about agriculture and the markets.

I was thinking…

... about South American crop potential.

At Pro Farmer, we've been reporting on drought conditions across South America. In fact, we've continued our popular Crop Tour newsletter into the U.S. winter so we can add a couple extra pages to the newsletter once a month to provide more information about South American crop conditions.

Some S. American crop-watchers call the corn crop "toast" -- others tell us the corn crop is hurt, but Argentina will still be a player in the 2008-09 corn export picture. From Brazil, Argentina and Paraguay, PF crop consultant Dr. Michael Cordonnier says S. America will produce about 62.7 million metric tons (MMT) of corn for export in the current marketing year. That's down about 23% from last year's production of 81.5 MMT from these three countries.

If the South American corn crop is off 20%-plus from year-ago, why haven't we seen a bigger price reaction in U.S. corn futures? That's a fair question, with a simple answer -- because the South American crop shortfall has not turned into extra export demand for U.S. corn. At least not yet...

University of Illinois Marketing Specialist Darrel Good says the South American corn crop problems could turn into additional demand for U.S. corn -- it just hasn't happened yet. (Click here for the full story from Good.)

The point is a South American crop problem only creates the potential for higher U.S. crop prices, it doesn't automatically push prices higher. For a crop shortfall anywhere in the world to support U.S. prices, it must turn into additional demand for U.S. crops. Until that happens, a crop problem in another exporting country only limits downside price risk.

The Argentine drought is also taking a big bite out of South American soybean supplies and the crop is also shrinking in Brazil and Paraguay. We'll detail the latest South American soybean crop estimates from PF crop consultant Dr. Michael Cordonnier in this week's Pro Farmer newsletter. And most importantly, we'll detail how crop problems there are turning into more demand here.

Welcome to the job!

Jan 20, 2009
Chip Flory

 

Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm, but taking care of two horses in the morning before I head in for work gives me a little time to think about the day ahead. Each morning, stop at this spot to get a feeling for the "tone of the day" - and some attitude about agriculture and the markets.

I was thinking…

... Welcome to the job!

At Noon on the East Coast, Barack Obama became the 44th President of the United States. Shortly after, he took the oath of office and as I write this he's delivering what will be a memorable inaugural address. After that, the parties will start and they'll last deep into the night. Celebrations will be countless across the country... it truly is a historic day -- a historic time! The first black president of the United States is a time to celebrate the progress this great country has made.

When Obama became president, at the request of our Washington consultant Jim Wiesemeyer, I started a stopwatch on the screen of my computer. We're just going to let it run to help us keep track of how long it takes before the country starts to change. We've got several items on the "change watch" -- policy issues, social issues, Iraqi issues and economic issues. Jim and I are more than willing to give Obama plenty of time to begin to deliver on the campaign promises he made that swept him into the most powerful political position in the world... and the world is too. And even if others around the world didn't start a stopwatch, there is a clock ticking in their heads. Many -- if not all -- Americans have high expectations for Obama. So high, in fact, that it will be difficult for Obama to meet those expectations.

And our new president realized this weeks ago. I'm sure his goals haven't changed, but his rhetoric has. He has delivered many warnings that current conditions will delay his goals and that current conditions won't allow him to accomplish what he promised in the time he promised. That's understandable... I don't think anybody could have anticipated the sequence of events that has happened to this country's economy in such a short period of time -- although some were close with their predictions.

The "take home" line from his speech was the country is entering, "A new era of responsibility." I'm sure we'll all figure out exactly what that means as time marches forward.

The inauguration speech is now over. It's time for the celebrations to begin. My advice to the new president is to party hard today and get it out of your system because tomorrow comes quick. And with tomorrow comes reality. No more parties, just hard work. There will be a honeymoon for Obama, but it won't last long. We're pulling and praying for Obama. It's what Americans do.

 

 

Much like the start of 2008...

Jan 05, 2009
Chip Flory

 

Chore time for me isn't what it used to be when I was growing up on our eastern Iowa farm, but taking care of two horses in the morning before I head in for work gives me a little time to think about the day ahead. Each morning, stop at this spot to get a feeling for the "tone of the day" - and some attitude about agriculture and the markets.

I was thinking…

... welcome to 2009!

If you've already heard that too much, I apologize. But everybody deserves a welcome to the new year and I'm happy to offer one, too!

Much like the start of 2008, the markets are focused on the "outsides" -- crude oil and the value of the U.S. dollar in particular.

Much like the start of 2008, traders are wondering about soybean production potential of Brazil and Argentina. And this year, the market is also concerned about corn production potential in both of these South American competitors.

Much like the start of 2008, investors are wondering where they should be putting their money. And while the Dow is well under the level that started 2008, stock prices were already well off the highs at the start of 2008 and equities were "falling out of favor" with investors.

Much like the start of 2008, input costs for U.S. producers are higher than year-earlier and traders are wondering just how much impact that will have on your acreage decisions for the year ahead.

Much like the start of 2008... well -- you get the idea. There are many areas where the start of 2009 differs from the start of 2008, but there many (MANY) similarities between the start of this year and the start of last year.

That doesn't mean we should expect 2009 price action to replicate what we saw in 2008... but it does mean the potential for that does exist. First on the list of items to check off in 2009 is figuring out where investors are likely to put their money for the first quarter of 2009. Next on the list is figuring out the production potential of South American corn and soybean crops.

After that... we need to figure out just how higher input costs will impact the acreage mix in the U.S. for 2009. We also need to figure out when the corn market will finally realize that steady-with-year-ago acres isn't enough acres for 2009 -- that would point carryover solidly under 1 billion bushels and likely force another season of rationing.

In the livestock markets, the start of 2009 is different from the start of 2008 in one very important way: Beef and pork production are expected to trend down throughout the year starting now. If demand (domestic and export) can hold close to steady, tightening supplies promises a brighter pricing picture for both cattle and hogs in the year ahead.

So... Happy New Year! Now... let's roll up the sleeves and figure out what these markets need to know to get 2009 started!

Log In or Sign Up to comment

COMMENTS

Receive the latest news, information and commentary customized for you. Sign up to receive Dairy Today's eUpdate today!

 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions