Aug 21, 2014
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THIS WEEK ON U.S. FARM REPORT

EPISODE # 2069

APRIL 6-7, 2013   

 

JOHN’S OPEN:

HELLO AND WELCOME TO U-S FARM REPORT, I'M JOHN PHIPPS. I KNOW I'M GETTING FORGETFUL IN MY DOTAGE, BUT DIDN'T MY CORN INVENTORY USED TO BE WORTH A WHOLE LOT MORE? THE USDA REPORT SHOWING A FEW HUNDRED MILLION UNEXPECTED BUSHELS AND THE SUBSEQUENT FREEFALL IN CORN PRICES DROPPED JAWS AND ATTITUDES SIMULTANEOUSLY. BUT AS I SPOKE TO A GROUP OF NEW YORK DAIRY FARMERS THEY WERE STRANGELY UPBEAT. I THOUGHT IT WAS BECAUSE SYRACUSE DOMINATED INDIANA IN THE NCAA, BUT JUST MAYBE FEED BUYERS ARE HAVING A VERY GOOD WEEK. CORN FARMERS WILL SURVIVE THIS PRICE DROP, AND JUST MAYBE OUR BEST CUSTOMERS WILL BECOME A LITTLE MORE OPTIMISTIC. THAT WORKS TOO.

HEADLINES:

CORN PRICES PLUMMETED THIS WEEK AS THE MARKETS TRIED TO ADJUST TO THE LATEST USDA PROSPECTIVE PLANTINGS AND GRAIN STOCKS REPORT. THE REPORT SHOWED STOCKPILES ARE LARGER THAN ESTIMATED AND CORN ACREAGE COULD BE THE HIGHEST SINCE 1936. FICKE SAYS HE'S BEEN FORTUNATE TO HAVE FEED AVIALABLE WITH 30 MILES OF HIS OPERATION. BUT HE SAYS YOU HEAD FARTHER WEST, THE FEED AND CATTLE DISSAPEAR. HIS CATTLE COLLEAGUES IN WESTERN NEBRASKA HAVE BEEN FORCED TO LIQUIDATE. THE LATEST REPORT SHOWED THE NATION'S CATTLE HERD HAS DWINDLED TO THE SMALLEST IN 61 YEARS. THE LATEST DROUGHT MONITOR CONTINUES TO PAINT A DREARY PICTURE IN CATTLE COUNTRY, WITH RED BLEEDING AS FAR NORHT AS SOUTH DAKOTA DOWN TO TEXAS.  AREAS OF THE SOUTHERN PLAINS WELCOMED A STORM FRONT THIS WEEK THAT DROPPED A COUPLE INCHES OF RAIN. OKLAHOMA STATE UNIVERSITY LIVESTOCK SPECIALIST DERRELL PEEL SAYS WEATHER OVER THE NEXT TWO MONTHS WILL DETERMINE FORAGE GROWTH FOR THE ENTIRE YEAR. MEANWHILE, THE DEPARTMENT OF JUSTICE HAS DECIDED TO ALLOW J-B-S TO ACQUIRE TWO U-S BASED X-L FOUR STAR BEEF PLANTS. J-B-S IS HEADQUARTED IN BRAZIL. THE TWO PLANTS ARE LOCATED IN OMAHA, NEBRASKA AND NAMPA, IDAHO. IN DECEMBER THE NATIONAL FARMERS UNION, ALONG WITH 40 OTHER AG ORGANIZATIONS, SENT A LETTER TO THE D-O-J ASKING THE DEPARTMENT TO EXTEND ITS INVESTIGATION OF THE ACQUISITION. THEY FEAR REDUCED COMPETITION WILL HARM CATTLE PRODUCERS AND CONSUMERS.

CROP WATCH:

CROP WATCH THIS WEEK.

ROUNDTABLE:

AL IS IN TO TALK MARKETS WITH MIKE NORTH AND DUSTIN JOHNSON.

JOHN’S WORLD:

WITH VERY LITTLE NOTICE COMPARED TO THE EXCITEMENT IN THE STOCK MARKET, BOND PRICES ARE INDICATING A CONTRASTING VIEW OF THE FUTURE. INTEREST RATES ARE SINKING BACK TOWARD HISTORIC LOWS MADE LAST YEAR, DESPITE CONTINUED WARNINGS ABOUT BOTH INFLATION AND HIGHER RATES. MUCH OF THE CREDIT OR BLAME HAS BEEN PLACED ON THE FEDERAL RESERVE AND ITS POLICY OF QUATITATIVE EASING. WHILE INACCURATELY CALLED "PRINTING MONEY", THE FED HAS BEEN INCREASING THE MONEY SUPPLY AGGRESSIVELY. THE PROBLEM WITH THIS EXPLANATION IS TWO-FOLD. FIRST, INTEREST RATES ARE LOW ALL AROUND THE WORLD - NOT JUST IN THE U-S. SECOND, WHILE ECONOMISTS WIDELY AGREE THE FED CAN INFLUENCE SHORT-TERM RATES, THEY HAVE LITTLE EFFECT ON LONG TERM RATES. RIGHT NOW, 30 YEAR BONDS CARRY A RETURN OF A LITTLE OVER 3 PERCENT. THIS TELLS US PEOPLE - NOT THE FED - THINK RATES COULD BE LOW FOR A GENERATION. I FAVOR ANOTHER INFLUENCE - THE SAVINGS GLUT - OR AS I CALL IT THE WEALTH PROBLEM. NEW REPORTS LEAKED TO AN AUSTRALIAN NEWSPAPER ILLUSTRATE ONE FACET OF THIS PHENOMENON - IMMENSE DEPOSITS HIDING UNREPORTED TO GOVERNMENT TAXING BODIES IN SHADY BANKS IN OUT-OF-THE-WAY PLACES. THE AMOUNTS OF UNACCOUNTED-FOR WEALTH IS LIKELY IN THE TENS OF TRILLIONS. THE MORE DOOMSAYERS WARN OF FINANCIAL PANIC, THE MORE WILLING SAVERS ARE TO ACCEPT PITIFUL RETURNS ON THEIR MONEY. WITH APOCLYPTIC RANTS MAKING HEADLINES DAILY, I THINK OUR SIX-YEAR STRING OF HISTORICALLY LOW INTEREST RATES IS LIKELY TO CONTINUE.

2ND HALF

JOHN’S OPEN:

HELLO AND WELCOME TO U-S FARM REPORT, I'M JOHN PHIPPS. IT'S A NEW MONTH, SO TIME FOR A RECORD FARMLAND PRICE STORY. AND THIS JUMP COULD BE A RECORD IF YOU FOLLOW ME. WHILE FARMERS ARE PLUNKING DOWN PROFITS FOR DIRT, FINANCIAL AND ACADEMIC ADVISORS ARE STANDING IN LINE TO GET THEIR NAMES DOWN FOR CALLING THE END OF THE FARMLAND BOOM. DESPITE THE FACT MANY HAVE BEEN ISSUING JEREMIADS FOR YEARS, THIS TIME THEY REALLY, REALLY MEAN IT. BUT THE FARMERS PAYING OUTRAGEOUS PRICES FOR LAND KNOW SOMETHING OTHERS DON'T. ALMOST ALL OF THE BUYERS WERE AROUND DURING THE EIGHTIES, AND LIVED TO TELL THE STORY. IF PRICES DO BREAK AGAIN, WE'LL THINK OF SOMETHING.

HEADLINES:

FARM LAND VALUES HAVE BEEN RISING, THAT WE ALREADY KNOW. BUT A ONE-YEAR INCREASE IN NORTH DAKOTA IS A HEAD-TURNER. HOW ABOUT 42% HIGHER! THAT FIGURE COMES FROM NORTH DAKOTA STATE EXTENSION. THE NORTHERN RED RIVER VALLEY SAW A 56-PERCENT INCREASE TO JUST OVER 34-HUNDRED DOLLARS. COMPARE THAT TO GOOD QUALITY FARMLAND IN IOWA WHICH HAS SEEN RECENT SALES REACHING 15-THOUSAND DOLLARS AN ACRE. THE AG DEPARTMENT IS FORECASTING A RECORD AMOUNT OF CORN ACRES WILL BE PLANTED IN NORTH DAKOTA THIS YEAR, JUST OVER FOUR MILLION, UP 500-THOUSAND ACRES. MEANWHILE FLOODING ALONG THE RED RIVER HASN'T OCCURRED YET THIS SPRING IN FARGO, NORTH DAKOTA BUT EMERGENCY OFFICIALS SAY IT'S COMING. SO, THEY'RE "BAGGING UP". USDA HAS DECIDED TO CONTINUE WITH ITS MONTHLY MILK PRODUCTION REPORT - AT LEAST IN PART. YOU MAY REMEMBER THE AG DEPARTMENT SAID IT WAS CANCELLING ABOUT A DOZEN REPORTS, INCLUDING MILK PRODUCTION, AS PART OF SEQUESTER CUTS. THE INDUSTRY ASKED USDA TO RECONSIDER SAYING THE DATA WAS VITAL TO DAIRY PRODUCERS. USDA SAYS IT WILL NOW PROVIDE AN 'ESTIMATE' OF U-S MILK PRODUCTION. BUT IT WILL NOT BE BASED ON PRODUCER SURVEYS, AS IT IS RIGHT NOW. THE NEW VERSION OF THE REPORT WILL ALSO REMOVE "MILK PER COW" STATS. PEOPLE IN THE MIDDLE EAST HAVE BEEN DRINKING CAMEL'S MILK FOR CENTURIES. AND NOW THE PRODUCT MAYBE GOING GLOBAL.

HARVEY HOUSE:

LONG BEFORE MCDONALDS STARTED SERVING BILLIONS AND BILLIONS OF BURGERS, EVEN BEFORE WENDY'S AND TACO BELL, A TEXAS MAN INVENTED TWO CONCEPTS THAT ARE NOW PART OF OUR DAILY LIFE - A QUICK MEAL AND CHAIN RESTAURANTS. IN THE DAYS OF THE STEAM ENGINE, THERE WAS THE HARVEY HOUSE - A FORERUNNER OF FAST FOOD. A NEW CONTRIBUTOR TO U-S FARM REPORT - TEXAS COUNTRY REPORTER BOB PHILLIPS - SHARES THE HISTORY OF HARVEY HOUSE.

TORNADO DEBRIS:

TORNADOES CAN OCCUR ANY TIME OF THE YEAR IN THIS COUNTRY. BUT THEY ARE MOST LIKELY TO CREATE THEIR PATHS OF DESTRUCTION IN SPRING AND SUMMER. SCIENTISTS AT THE UNIVERSITY OF GEORGIA ARE STUDYING THE DEBRIS PATH IN HOPES OF CREATING BETTER SAFETY MEASURES FOR THE PUBLIC. METEOROLOGIST MIKE HOFFMAN HAS OUR STORY.

TRACTOR TALES:

WHAT'S IN STORE FOR THIS WEEK'S TRACTOR TALES AL?" JOHN, WE ARE HEADED WAY BACK IN TIME FOR THIS WEEK'S CLASSIC IRON.

CHURCH SALUTE:

TODAY'S COUNTRY CHURCH SALUTE TAKES US TO THE BEAUTIFUL APPALACHIANS IN NORTHWEST VIRGINIA. THE CONGREGATION AT OTTOBINE CHURCH OF DAYTON, VIRGINIA IS CELEBRATING MORE THAN 170 YEARS OF MINISTRY. THE FIRST CHURCH AT THE SITE WAS BUILT AROUND 1834. FIFTY YEARS LATER, A NEW CHURCH WAS BUILT AND IT WAS NAMED THE UNITED BRETHREN CHURCH. OVER THE GENERATIONS THE CHURCH HAS BEEN REMODELED AND RE-NAMED SEVERAL TIMES. IT MERGED WITH THE METHODIST DENOMINATION IN 1968. OUR THANKS TO CHURCH MEMBER MARGARET ANN WHEELBARGER FOR SHARING THE HISTORY OF OTTOBINE CHURCH IN ROCKINGHAM COUNTY, VIRGINIA.

MAILBAG:

TIME NOW FOR OUR WEEKLY LOOK INSIDE THE FARM REPORT MAILBAG. WE GET OCCASIONAL COMMENTS LIKE THIS, SO I WILL TAKE UP THE TOPIC ONCE MORE.

 

As always, we want to hear from you, send comments to mailbag@usfarmreport.com or leave us a voice mail at 800-792-4329.

 


 

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