USFR Weekly Recap - December 21-22, 2013

December 21, 2013 02:30 AM
 

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THIS WEEK ON U.S. FARM REPORT

EPISODE # 2106

DECEMBER 21-22, 2013   

 

 

JOHN’S OPEN:

HELLO AND WELCOME TO U-S FARM REPORT, I'M JOHN PHIPPS. IT HAS BEEN ALTOGETHER TOO EASY TO TO JUST ACCIDENTALLY ON PURPOSE IGNORE THE GRAIN MARKETS AND FOCUS ON CHRISTMAS STUFF THE LAST FEW WEEKS. NO FIREWORKS, BUT JUST A STEADY GRIND LOWER THAT'S BECOMING SOMETHING SIMILAR TO AN ECONOMIC TOOTHACHE. BUT AS MUCH AS WE GRUMBLE ABOUT THIS, IT'S KIND OF OUR TURN. GRAIN BUYERS ARE HAVING A MUCH MORE HEART-WARMING SEASON, AFTER ALL. HOWEVER, THE FACT THAT WE'VE FORGOTTEN WHAT BEARISH MARKETS FEEL LIKE IS NOT ANY REASON TO BELIEVE WE CAN'T MANAGE THEM. SO FRANKLY, I DON'T FEEL GUILTY ABOUT TUNING OUT.  THE MARKETS WILL STILL BE TRADING IN JANUARY. TIME NOW FOR THE HEADLINES.....HERE'S AL PELL IN FOR TYNE MORGAN.

HEADLINES:

THANKS JOHN. THE U-S ATTORNEY IN IOWA SAYS SIX MEN FROM CHINA HAVE NOW BEEN INDICTED FOR THEIR ALLEGED INVOLVEMENT IN A SCHEME TO STEAL SEED TECHNOLOGY.

THE SIX CHINESE NATIONALS ALL WORKED FOR A CHINESE SEED-COMPANY. THE U-S ATTORNEY SAYS BETWEEN SPRING OF 2011 TO DECEMBER OF LAST YEAR, THE MEN CONSPIRED TO STEAL TRADE SECRETS FROM PIONEER, MONSANTO AND L-G SEEDS. THE DEFENDANTS ARE ACCUSED OF TRYING TO STEAL 'PARENT' LINES OF SEED AND SNEAK-OUT OF THIS COUNTRY. IN A SEPARATE BUT SIMILAR CASE - THIS MAN IS ALSO ACCUSED OF CONSPIRING TO STEAL SEEDS FROM A RESEARCH FACILITY IN KANSAS AND THEN PASS THEM TO A CHINESE DELEGATION THAT TOURED THE U-S THIS YEAR. DURING A DETENTION HEARING IN KANSAS, THE JUDGE ORDERED THE DEFENDANT BE DETAINED IN FEDERAL CUSTODY FOR THE TIME BEING.  KEEPING WITH CHINA - DAIRY DEMAND IN THAT COUNTRY SHOULD KEEP DAIRY PRICES STRONG IN 2014. RABO-BANK SAYS THAT INTERNATIONAL DAIRY COMMODITY PRICES SHOULD STAY THERE AT LEAST FOR THE FIRST HALF OF 2014.  RABOBANK SAYS CHINA'S BUYING HAS LEFT THE REST OF THE BUY-SIDE OF THE INTERNATIONAL MARKET WITH LESS SUPPLY TO GO ROUND. THAT'S KEEPING THE MARKET TIGHT.  THE U.S. GRAINS COUNCIL, THE USDA AND US TRADE REPRESENTATIVE SAY THEY'VE SUCCEEDED IN KEEPING THE PANAMA MARKET OPEN FOR U.S. CORN. A FEW MONTHS AGO THE PANAMANIAN GOVERNMENT SAID IT WOULD CLOSE ITS DOOR TO CORN IMPORTS FROM JANUARY THROUGH APRIL. AFTER DISCUSSING THE ISSUE, THE NEW FREE TRADE PARTNER AGREED TO KEEP GRAIN FLOWING IN 2014. A-D-M ANNOUNCED THIS WEEK IT'S STAYING IN ILLINOIS, BUT IT WILL MOVE ITS GLOBAL HEADQUARTERS TO CHICAGO FROM DECATUR.

THE COMPANY WANTS EASIER ACCESS FROM A LARGER HUB-CITY. THE COMPANY SAYS DESPITE NOT BEING ABLE TO SECURE SPECIAL TAX INCENTIVES FROM ILLINOIS LAWMAKERS, IT WILL MOVE ABOUT 75 EXECUTIVES TO CHICAGO. 2014 COULD BRING A TURNAROUND FOR COTTON ACREAGE. JOHN ROBINSON - A COTTON SPECIALIST WITH TEXAS A-AND-M - SAYS COTTON ACRES IN 2014 COULD INCREASE TO 11 MILLION FROM THE 10-POINT-THREE MILLION ACRES THAT WE SAW THIS YEAR. ROBINSON SAYS AS PRICES FOR CORN, SORGHUM, AND WHEAT SINK, ACRES COULD SHIFT INTO COTTON AT LEAST IN TEXAS.  EACH YEAR AN ILLINOIS BASED RESEARCH FIRM - NAMED "FIRST" - ANALYZES YIELD RESULTS FROM VARIOUS SEED MAKERS. THOUSANDS OF SAMPLES ARE GATHERED FROM COUNTLESS FIELDS IN A VARIETY OF SOIL CONDITIONS. GENERAL MANAGER JOE BRUCE DISCUSSED THE RESULTS OF THEIR CORN RESEARCH WITH CLINTON GRIFFITHS.

ROUNDTABLE:

THIS WEEK, CHRIS BARRON AND MIKE NORTH JOIN US IN THE STUDIO TO TALK MARKETS.

JOHN’S WORLD:

I REALLY APPRECIATE THIS OPPORTUNITY EVERY WEEK TO RAISE TOPICS I THINK ARE IMPORTANT FOR FARMERS AND RURAL AMERICANS TO CONSIDER. AND I HAD A SERIOUS REFLECTION ABOUT AN UNFORTUNATE ADDITION TO THE RECENT BUDGET COMPROMISE THAT WILL MAKE FOOD AID EVEN MORE INEFFICIENT. BUT AS I WAS GETTING MY THOUGHTS TOGETHER, I WAS ALSO 1) LISTENING TO MY ABSOLUTE GREATEST CHRISTMAS MUSIC PLAYLIST EVER 2) RUINING MY APPETITE FOR SUPPER WITH CHRISTMAS COOKIES 3) WATCHING MY CHRISTMAS LIGHTS COME ON OUTSIDE - BY THE WAY, THE BLUE LED LIGHTS REALLY AREN'T WORKING OUT - MY YARD LOOKS LIKE A PERPETUAL TRAFFIC ACCIDENT. ANYWAY, I DECIDED THIS WEEKEND JUST WASN'T THE TIME FOR INTRICATE TRADE AND FARM POLICY MINUTIA. IN FACT, IT  MAY BE BETTER SPENT TRYING TO JUST LET SOME THINGS GO. SO I INVITE YOU TO JOIN ME IN SOME HOLIDAY INEFFICIENCY. THAT'S RIGHT, I'M TALKING ABOUT DOING ONLY ONE THING AT A TIME, LIKE LISTENING TO A FRIEND OR ATTENDING A PARTY. LET THE E-MAILS AND TEXTS PILE UP. BY NOT ANSWERING, YOU'RE PROBABLY HELPING THE SENDER TO SLOW DOWN AS WELL AND HE CAN BLAME IT ON YOU. THAT COUNTS AS A GIFT, IN MY BOOK. SEE IF YOU CAN HELP SOMEONE ELSE FIND SOME RESPITE AS WELL. SHOVEL A WALK, SHUTTLE SOME KIDS, PICK UP YOUR OWN CLOTHES. HECK I'M EVEN TOYING WITH MAKING THE BED. HOW HARD COULD IT BE? WE SPEND TOO MUCH TIME AFRAID WE ARE WASTING TIME, AS IF WE ARE CONSTANTLY SCORED ON PRODUCTIVITY. BUT THIS IS EXACTLY THE SEASON TO LET THOSE ANXIETIES WAIT. REMEMBER THE MESSAGE: FEAR NOT - GOOD NEWS.

2ND HALF

JOHN’S OPEN:

HELLO AND WELCOME TO U-S FARM REPORT, I'M JOHN PHIPPS. IT'S TIME FOR THE END OF THE YEAR WRAP-UPS. I'VE BEEN PRINTING OUT MY ACCOUNTING REPORTS FOR MY ANNUAL CROSS-EXAMINATION AT THE BANK, AND FEEDING THE DATA TO MY TAX SOFTWARE AS WELL. WHILE I THOUGHT I HAD A PRETTY GOOD IDEA HOW MY BUSINESS EMPIRE WAS FUNCTIONING, THERE HAVE BEEN A FEW SURPRISES.  EVEN MODEST FARMS LIKE MINE ARE WORKING WITH LARGER NUMBERS. AS A RESULT, THERE IS SOME RISK OF LOSING TRACK OF SMALL FINANCIAL MISCUES THAT CAN GRADUALLY GROW INTO COSTLY HEADACHES. TO INCENTIVIZE MY FLAGGING ENTHUSIASM FOR THIS TEDIOUS TASK, I'VE DECIDED CORRECTING THOSE MISTAKES IS A LOT LIKE FINDING WALDO - AND GETTING PAID FOR IT. LET'S GET STARTED WITH THE HEADLINES. AL PELL IS IN FOR TYNE MORGAN.

HEADLINES:

MAJOR TAX CHANGES ARE ON THE LINE FOR U-S FARMERS AND RACHERS IN 2014. IF CONGRESS DOESN'T ACT, SECTION 179 WILL TUMBLE FROM 500 THOUSAND DOLLARS TO 25 THOUSAND DOLLARS.  NATIONAL REPORTER TYNE MORGAN SITS DOWN WITH CPA PAUL NEIFFER TO DISCUSS. IN SOUTH DAKOTA THIS WEEK, A-B-C NEWS ASKED A JUDGE TO DISMISS A LAWSUIT BROUGHT AGAINST THE NEWS NETWORK. SOUTH DAKOTA-BASED BEEF PRODUCTS INCORPORATED IS SUING A-B-C OVER COVERAGE OF LEAN, FINELY TEXTURED BEEF. AND A GROUP OF PEDIATRICIANS IS NOW FORMALLY SAYING 'NO' TO RAW MILK. THE AMERICAN ACADEMY OF PEDIATRICS IS ADVISING AGAINST CONSUMPTION OF RAW MILK PRODUCTS.   IN A NEW POLICY STATEMENT, THE A-A-P ADVISES EXPECTANT WOMEN, INFANTS AND CHILDREN TO CONSUME ONLY PASTEURIZED MILK, CHEESE AND OTHER MILK PRODUCTS.  THE ORGANIZATION SUPPORTS A BAN ON THE SALE OF RAW MILK IN THE U.S. SALES ARE STILL LEGAL IN AT LEAST 30 STATES.

TREE FARM:

FROM TRIMMING TO SELLING, TREE FARMING IS A BIG JOB. BUT FOR ONE NEW FARMER, IT WAS MORE APPEALING THAN OTHER CROPS OR ANIMALS, BECAUSE SHE DIDN'T KNOW THE FIRST THING ABOUT RAISING LIVESTOCK. IT'S A DECISION THAT'S SPREADING JOY TO THOSE EAGER TO CUT THEIR OWN TREE.

BAXTER BLACK:

BAXTER BLACK CONTINUES OUR CHRISTMAS THEME AND SHARES AN UNUSUAL PERSPECTIVE ON THAT WONDERFUL NIGHT

TRACTOR TALES:

WE'RE OFF TO PORT HOPE MICHIGAN. HAROLD MC-TAGGART SAYS HE HAS NO FAVORITES IN HIS COLLECTION OF NEARLY 100 TRACTORS. BUT THIS 1944 W-SIX MCCORMICK NEEDED A LITTLE MORE ATTENTION WHEN IT ARRIVED.

CHURCH SALUTE:

TODAY'S COUNTRY CHURCH SALUTE GOES TO TWO RIVERS UNITED METHODIST CHURCH IN ROCK ISLAND ILLINOIS. STARTED IN 1833, IT IS THE OLDEST CHURCH IN THE QUAD CITIES WHICH BORDERS ILLINOIS AND IOWA. THE CURRENT CHURCH WAS BUILT IN 1889.  IT UNDERWENT MAJOR RENOVATIONS - BOTH INSIDE AND OUT - TO HELP CELEBRATE THE 180 YEARS OF MINISTRY. PASTORS STEVE KETTLEKAMP AND LESLIE THOMAS LEAD THE CONGREGATION OF 230 PEOPLE. OUR THANKS TO LARRY DOLTON FOR SHARING THE NEWS OF TWO RIVERS UNITED METHODIST CHURCH. AND OUR SECOND CHURCH SALUTE TAKES US TO FLOYD COUNTY, VIRGINIA WHERE MEMBERS OF WHITE ROCK CHURCH OF THE BRETHREN ARE CELEBRATING ITS 125TH ANNIVERSARY. THE CHURCH WAS FORMERLY KNOWN AS THE GERMAN BAPTIST AND DUNKER BRETHREN CHURCH. IN 1893 CONSTRUCTION BEGAN ON THE CHURCH. THE CORNERSTONE OF THE BUILDING IS A LARGE WHITE ROCK, SO THE CHURCH IS APTLY NAMED. REVERAND MICHAEL PUGH CURRENTLY LEADS THE CHURCH. THANKS TO BEVERLY SIMON FOR TELLING US ABOUT WHITE ROCK CHURCH OF THE BRETHREN.

MAILBAG:

TIME NOW FOR OUR WEEKLY LOOK INSIDE THE FARM REPORT MAILBAG. I'VE RECEIVED SEVERAL COMMENTS ABOUT MY BUDGET PRIORITIES - AND I WILL ANSWER MORE IN THE FUTURE - BUT ONE OF MY OWN NEIGHBORS PICKED UP ON A SLEEPER I HAD ON MY LIST. "I MUST TAKE EXCEPTION WITH YOUR PROPOSAL TO ELIMINATE THE STEPPED UP BASIS. MANY WOULD BE FORCED TO SELL THEIR FARMS WITHOUT A STEPPED UP BASIS. HOW IS THAT A GOOD THING?"   DALE ENGLISH, PARIS, IL DALE, YOU ARE RIGHT. THE BASIS STEP UP ALLOWS PEOPLE TO AVOID A LOT OF TAXES. BUT IT STRIKES ME AS A BLATANTLY UNFAIR LOOPHOLE.

HERE'S HOW THIS TAX EXPENDITURE WORKS. IF I BOUGHT A FARM TEN YEARS AGO FOR 3000 DOLLARS AN ACRE AND SOLD IT TODAY FOR TEN THOUSAND, I WOULD HAVE TO PAY CAPITAL GAINS TAX ON THE APPRECIATION IN VALUE OVER THE YEARS OF SEVEN THOUSAND DOLLARS. THIS WOULD APPLY TO OTHER TYPES OF ASSETS LIKE STOCKS TOO. BUT IF I DIE TODAY, MY HEIRS COULD SELL THE FARM IMMEDIATELY WITH NO CAPITAL GAINS BECAUSE THE BASIS OR COST GETS RESET TO THE CURRENT VALUE WHEN THE OWNER DIES. MY QUESTION IS WHY?  WHY SHOULD DEATH BE A GET-OUT-OF-TAXES-FREE CARD? IF YOU RESEARCH INTERNAL REVENUE CODE SECTION 1014 YOU'LL FIND NO GOOD REASON. IT'S JUST A TAX GIVEAWAY THAT BENEFITS WEALTHIER PEOPLE. IT ALSO COSTS THE TREASURY SIXTY BILLION DOLLARS A YEAR. SO IF BALANCING THE BUDGET IS THE TOP PRIORITY FOR  MOST AMERICANS, IF NOT FOR ME, I THINK WE SHOULD AT LEAST START BY ELIMINATING TAX BREAKS THAT HAVE NO ECONOMIC OR LOGICAL JUSTIFICATION.

 

 

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