Sep 16, 2014
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THIS WEEK ON U.S. FARM REPORT

EPISODE # 2116

MARCH 1-2, 2014   

 

JOHN’S OPEN:

HELLO AND WELCOME TO A SPECIAL EDITION OF U-S FARM REPORT, I'M JOHN PHIPPS. MUCH AS WE HATED TO LEAVE THE CHARM OF INDIANA IN LATE FEBRUARY DUTY HAS CALLED US TO SAN ANTONIO, TEXAS, WHERE THEY HAVE BEEN HAVING A DIFFERENT WINTER THAN THEIR MIDWESTERN VISITORS. IT HAS BEEN SUCH A COLD AND SNOWY SEASON FOR THE EASTERN TWO-THIRDS THE EXCEPTIONAL HIGH TEMPERATURES IN THE SOUTHWEST STRUGGLE TO GET MUCH LIMELIGHT. HARDER STILL TO COMPREHEND, IS THAT JANUARY WAS THE FOURTH WARMEST ON RECORD FOR THE GLOBE. COUNTRIES LIKE FRANCE AND CHINA HAD THE WARMEST JANUARY EVER. MAYBE JUST LIKE POLITICS, WEATHER IS BECOMING LESS BIPARTISAN.

HEADLINES:

SOYBEAN FARMERS ARE ALL SMILES THIS WEEK AT COMMODITY CLASSIC. THAT'S BECAUSE THE OILSEED CLOSED AT A FIVE MONTH HIGH. MUCH OF THAT BOOST IS DUE TO REPORTS OF DECLINING YIELDS IN SOUTH AMERICA. THE MARCH CONTRACT HIT ABOVE 14 DOLLARS AND SEPTEMBER WELL ABOVE 12 DOLLARS. CATTLE ALSO HAD A NICE RUN, ALSO TRADING AT RECORD LEVELS AGAIN THIS WEEK. THE HOUSE ROLLED OUT ITS TAX REFORM PLAN. FARM CPA PAUL NEIFFER TOLD US IT HAS BOTH POSITIVES AND NEGATIVES FOR FARMERS. IT WOULD MAKE SECTION 179 PERMANENT AT 250 THOUSAND DOLLARS, INDEXXED FOR INFLATION. AND CASH BASIS ACCOUNTED WOULD BE RETAINED. WHILE THE LACK OF MOVEMENT ON CANADIAN RAILWAYS PUSHED OAT PRICES HIGHER, CANADA SAYS IT'S TRYING TO FIND A FIX. TWO MAJOR RAILWAYS PLANT TO PUT THOUSANDS OF MORE CARS EACH WEEK TO TRANSPORT GRAIN. WEATHER AND A RECORD HARVEST HAS CAUSED A BACKLOG ON the RAILWAYS THIS YEAR. ELANCO ANNOUNCED THIS WEEK IT'S PURCHASING A WELL-KNOWN POULTRY VACCINE PROVIDER. ELANCO SAYS IT HOPES PURCHASING GERMAN BASED LOHMANN ANIMAL HEALTH THIS ACQUISITION WILL ESTABLISH THE COMPANY AS A GLOBAL POULTRY LEADER, AS WELL AS BOOST THE COMPANY'S VACCINE MANUFACTURING CAPABILITIES. AS TRANS PACIFIC PARTNERSHIP TRADE TALKS MOVE FORWARD, JAPAN IS ASKING FOR SPECIAL TREATMENT. THE TALKS INVOLVE 12 DIFFERENT COUNTRIES LINING THE PACIFIC RIM AND HAS BEEN A HOT TOPIC AT COMMODITY CLASSIC THIS YEAR. HOWEVER, JAPAN IS ASKING TARIFFS TO NOT BE ELIMINATED ON CERTAIN GOODS, INCLUDING SOME AGRICULTURAL PRODUCTS. A GROUP OF 16 SEANTORS SENT A LETTER TO U-S TRADE REPRESENTATIVE MICHEAL FROMAN THIS WEEK SAYING IF JAPAN CAN'T PLAY FAIR, THEN LEAVE THAT COUNTRY OUT OF A DEAL. ASA AGREES. MEANWHILE, JAPAN SAYS IT'S INCREASING WHEAT PRICES TO LOCAL FLOUR MILLERS. THE COUNTRY CITES A GOVERNMENT HIKE IN SALES-TAXES AS THE REASON.  JAPAN SAYS PRICES WILL GO UP AN AVERAGE OF 2 POINT 3%. JAPAN IS THE SECOND LARGEST WHEAT IMPORTER IN ASIA.

CROP WATCH:

WELL, UNLIKE YOU TYNE, NOT A LOT OF WARMTH TO REPORT ON THIS WEEK IN CROPWATCH.

ROUNDTABLE:

TYNE TAKES BACK OVER AND FOR THIS WEEK'S MARKETING ROUNDTABLE FROM THE 2014 COMMODITY CLASSIC.

JOHN’S WORLD:

IN TALKING WITH FARMERS HERE AT THE COMMODITY CLASSIC, I HEAR A CLEAR UNDERTONE OF CAUTION. NOWHERE IS THIS MORE PRONOUNCED THAN IN THEIR DETERMINATION TO CONTROL EXPENSES. OF COURSE, WE IN THE MEDIA AND AG ADVISORS HAVE SPENT ALL WINTER NAGGING - AND I CHOOSE THAT WORD DELIBERATELY - ABOUT OVERSPENDING. SOMEHOW THE WORSE OFFENSES ARE EXCESSIVE PERSONAL CONSUMPTION OR FAMILY LIVING EXPENSES. THE FACT THAT FARMERS INCREASED LIVING EXPENSES BY AROUND 20% WHILE NET INCOME WAS TRIPLING REALLY IRRITATED THOSE WHO MONITOR OUR PERSONAL ECONOMICS. I THINK ECONOMISTS ARE WAY OFF BASE AND SHOULD DIAL THAT CRITICISM BACK. INFLATION ALONE, ESPECIALLY FOR AN INDUSTRY WITH A LOT OF INDIVIDUAL HEALTH INSURANCE POLICIES WOULD ACCOUNT FOR MUCH OF THAT INCREASE. I ALSO THINK THIS IS AN CONDESCENDING INTRUSION INTO OUR PERSONAL LIVES AS WELL. I DON'T LECTURE ACCOUNTANTS AND ECONOMISTS ON HOW MUCH TO ALLOCATE TO THEIR VACATIONS, AFTER ALL. LIVING EXPENSES HAVE BEEN FAR OUTSTRIPPED ON MY FARM BY OTHER EXPENSES ON A PER ACRE BASIS. SEED COMES TO MIND, ALONG WITH FERTILIZER, PESTICIDES, AND OF COURSE RENTS. BUT UNLIKE THOSE COSTS, FAMILY LIVING EXPENSES DOESN'T HAVE A LOBBY OR HAND OUT SPEAKING FEES OR GRANTS. BUT IF I NEED TO LOWER COSTS I THINK I'LL TAKE THE FAMOUS BANK ROBBER ADVICE AND TARGET WHERE THEY MONEY IS.
AND FAMILY LIVING FOR MOST FARMERS IS WAY DOWN THE LIST, ESPECIALLY WHEN COMPARED TO EVEN A FEW YEARS AGO.

2ND HALF

JOHN’S OPEN:

HELLO AND WELCOME TO U-S FARM REPORT, I'M JOHN PHIPPS. WE'RE JOINING THOUSANDS OF PRODUCERS AT THE COMMODITY CLASSIC IN SAN ANTONIO THIS WEEK. EACH YEAR WE LOOK FORWARD TO SEEING OLD FRIENDS AND MAKING NEW ONES AT THIS PREMIER EVENT. WE'LL BE REPORTING ON THE INFORMATION WE HEAR AND THE MOOD OF THE ATTENDEES, AS AGRICULTURE GETS READY TO CONFRONT THE CHALLENGES OF THIS GROWING SEASON. SOME OF THOSE CHALLENGES ARE OLD HEADACHES, BUT IT LOOKS LIKE 2014 WILL HAVE SOME UNIQUE PROBLEMS, AND UNDOUBTEDLY SOME SURPRISING REWARDS, AS WELL.

HEADLINES:

THANKS, JOHN. SECRETARY TOM VILSACK MADE AN APPEARANCE HERE AT COMMODITY CLASSIC THIS WEEK. WHILE THE FARM BILL IS ON the BOOKS, IMPLEMENTATION OF THE 900 PAGE BILL IS STILL IN THE WORKS. WASHINGTON STATE SAYS ALL SWINE ENTERING THE STATE NEEDS TO HAVE EVIDENCE THE ANIMALS ARE FREE OF P-E-D-V. THE RULE GOES INTO EFFECT IMMEDIATELY AND SET TO LAST AT LEAST 120 DAYS. PEDV HAS NOW SPREAD TO HALF OF U.S. STATES. A CALIFORNIA SLAUGHTERHOUSE RECENTLY UNDER FIRE FOR HAVING TO RECAL 8 MILLION POUNDS OF BEEF IS NOW UNDER THE FEDERAL EYE. A CALIFORNIA NEWSPAPER SAYS RANCHO FEEDING OPERATION IS BEING INVESTIGATED BY FEDERAL OFFICIELS. THE LARGE RECALL IS LINKED TO A POPULAR SNACK CALLED THE HOT POCKETS. USDA SAYS THE COMPANY PROCESSED DISEASED AND UNHEALTHY ANIMALS AND CIRCUMVENTED FEDERAL INSPECTION RULES. MOVE OVER TEXAS. THERE'S A NEW TOP CATTLE FEEDER IN TOWN. NEBRASKA GRASPED THE TOP SPOT AS OF FEBRUARY FIRST.  THE LAST CATTLE ON FEED REPORT SHOWED TEXAS HAD 2 POINT 46 MILLION HEAD OF FEEDER CATTLE. THAT'S 20 THOUSAND MORE THAN TEXAS. WHILE SEVERAL STORM SYSTEMS DRENCHED CALIFORNIA THIS WEEK, IT COULD BE TOO LITTLE TOO LATE FOR FARMERS AND RANCHERS. JUST LAST WEEK, THE FEDERAL GOVERNMENT ANNOUNCED FARMERS IN the CENTRAL VALLEY WON'T RECEIVE ANY IRRIGATION WATER.  THAT AREA IS THE WORLD'S MOST PRODUCTIVE AGRICULTURAL REGION, WITH MULTIPLE DIFFERENT CROPS. THIS IS IN ADDITION TO THE STATE'S ANNOUNCEMENT OF NO WATER ALLOCATIONS IN EARLY FEBRUARY. IF YOU HAVE ANY GOT MILK POSTERS, THOSE ITEMS COULD BE A HOT COMMODITY IN THE FUTURE. THAT'S BECAUSE THE MILK PROCESSOR EDUCATION PROGRAM ANNOUNCED IT'S DOING AWAY WITH THAT ICONIC AD CAMPAIGN. THE NEW CAMPAIGN IS CALLED 'MY LIFE'. THE GOAL IS TO RAMP UP A SLOWING GROWTH IN MILK CONSUMPTION BY HIGHLIGHTING HOW MILK IS A PART OF CONSUMERS' LIVES AND THE NUTRITIONAL BENEFITS THAT COMES WITH CONSUMING MILK PRODUCTS. UP UNTIL NOW, THE 'GOT MILK' TAGLINE HAD BEEN RUNNING SINCE 1995.

TEXAS CATTLE:

AS PARCHED SOILS ACROSS TEXAS HAVE STRUGGLED FROM THE ONGOING DROUGHT, SOME AREAS HAVE SEEN RECENT RELIEF. SOUTH OF SAN ANTONIO, HOWEVER, THAT RAIN HASN'T BEEN ENOUGH. AND WHILE RANCHERS HOPED 2014 WOULD BE THE YEAR OF REBUILDING, TOO MUCH RISK MAKES THAT LOOK LIKE AN UNLIKELY OUTCOME THIS YEAR.

BAXTER BLACK:

IN AGRICULTURE, WE ARE USED TO CONSTANT SALES PITCHES. WHETHER IT'S SEED, CHEMICALS OR NUTRITION PRODUCTS FOR OUR ANIMALS, THE PRODUCTS ARE CONSTANTLY CHANGING. BUT HAVE YOU EVER RUN ACROSS A SUPER SALESMAN? BAXTER BLACK EXPLAINS.

TRACTOR TALES:

WELCOME BACK TO THIS SPECIAL EDITION OF U-S FARM REPORT. THIS WEEK WE'VE GOT A SPECIAL TRACTOR TALES RIGHT HERE FROM THE LONE STAR STATE.

 

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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