AgDay Daily Recap -Sept. 1, 2016

September 1, 2016 02:57 AM
 

TODAY ON AGDAY
SEPT. 1, 2016


OPENING HEADLINES:
COMING UP TODAY ON AGDAY -AN AGRIBUSINESSES MEGA-MERGER GETS PUT ON HOLD BY THE DOJ. PLUS PERSPECTIVE ON FARM INCOME FROM THE FARM PROGRESS SHOW. IN AGRIBUSINESS...CROP YIELD EXPECTATIONS FROM ALLENDALE. YOU KNOW THE ONLY QUESTION HERE IS THE SIZE OF THIS YEARS RECORD YIELD NO DOUBT ABOUT THAT. JUST HOW DID FIVE HUNDRED COWS DISAPPEAR FROM A FARM IN NEW ZEALAND? AND AS ITALY WORKS TO RECOVER FROM A MASSIVE EARTHQUAKE LIVESTOCK OWNS ARE STRUGGLING TO CARE FOR THEIR HERDS.
DEERE BEING SUED BY DEPARTMENT OF JUSTICE OVER ACQUISITION:
GOOD MORNING I'M CLINTON GRIFFITHS. JOHN DEERE'S PLANNED ACQUISITION OF PRECISION PLANTING JUST RAN INTO A MAJOR LEGAL ROADBLOCK. THE DEPARTMENT OF JUSTICE SUED DEERE OVER THE DEAL, CITING CONCERNS ABOUT LACK OF COMPETITION. THE D-O-J BELIEVES THE PURCHASE WOULD LIKELY LEAD TO HIGHER COSTS FOR U.S. FARMERS. IN NOVEMBER, DEERE AND THE CLIMATE CORPORATION, A SUBSIDIARY OF MONSANTO COMPANY, ANNOUNCED THEY HAD SIGNED AN AGREEMENT FOR DEERE TO BUY THE PRECISION PLANTING EQUIPMENT BUSINESS. GOVERNMENT REGULATORS THEN LAUNCHED AN ANTI-TRUST REVIEW, LEADING TO WEDNESDAY'S ANNOUNCEMENT. IN A JOINT STATEMENT, DEERE AND CLIMATE CORP. SAID "D-O-J'S ALLEGATIONS ABOUT THE COMPETITIVE IMPACTS OF THE TRANSACTION ARE MISGUIDED AND THE COMPANIES INTEND TO DEFEND THE TRANSACTION VIGOROUSLY AGAINST THOSE ALLEGATIONS,"
MORE MERGERS:
MERGERS AND CONSOLIDATION CONTINUES TO PICK UP SPEED IN THE AG INDUSTRY. JUST THIS WEEK, CANADIAN FERTILIZER GIANTS AGRIUM AND POTASH CORP OF SASKATCHEWAN SAY THEY'RE IN THE EARLY STAGES OF MERGER TALKS. WHILE BOTH CAUTION A DECISION IS YET TO BE MADE, THE COMBINATION WOULD CREATE COMPANY VALUED AT 28 BILLION DOLLARS. LOWER FARM INCOMES AND COMMODITY PRICES CONTINUE TO WEIGH ON BUSINESS MARGINS FOR BOTH COMPANIES.
ROUSSEFF OFFICIALLY IMPEACHED:
AFTER MONTHS OF TURMOIL, THE BRAZILIAN SENATE HAS DECIDED TO REMOVE PRESIDENT DILMA ROUSSEFF FROM OFFICE. THE VOTE 61 TO 20 OFFICIALLY CONVICTING THE FIRST FEMALE PRESIDENT OF BRAZIL...ON CHARGES OF MANIPULATING THE FEDERAL BUDGET IN AN EFFORT TO CONCEAL THE NATION'S GROWING ECONOMIC PROBLEMS. MICHEL TEMER--THE CURRENT INTERIM PRESIDENT AND MS. ROUSSEFF'S VICE PRESIDENT--IS NOW EXPECTED TO REMAIN IN OFFICE UNTIL THE CURRENT TERMS END OF THE CURRENT TERM IN 2018. BACK AT HOME, THE USDA IS REVISING ITS OUTLOOK FOR FARM INCOME. IT'S ACTUALLY FORECASTING HIGHER PROFITS THIS YEAR BASED ON FALLING COSTS FOR FEED, FUEL AND FERTILIZER. NET FARM INCOME IS NOW EXPECTED TO 71 AND A HALF BILLION DOLLARS IN
2016. THAT 30 PERCENT HIGHER THAN THE FEBRUARY ESTIMATE. BUT STILL 11 PERCENT SMALLER THAN LAST YEAR.
FARM PROGRESS:
TYNE MORGAN SPENT THE WEEK AT THE FARM PROGRESS SHOW IN BOONE IOWA...WHERE AGRIBUSINESSES CONTINUE TO WORRY ABOUT FARM INCOME IN THE YEAR AHEAD. TYNE. THANKS CLINTON YEAH WE'RE HERE AT THE FARM PROGRESS SHOW BEAUTIFUL WEATHER TODAY TEMPERATURES ARE NICE YEAH THE CROWD SEEMS TO BE PICKING UP HERE THE FARM PROGRESS SHOW HERE WITH STEVE NICOLSON OF RABO AGRIFINANCE STEVE YOU GUYS ARE TALKING ABOUT THIS FARMING ON THE EDGE OF LIQUIDITY WHAT THAT MEANS IS THAT FARMERS NOW KIND OF RUN OUT OF CASH. AND IN DOWN TIMES IT DOESN'T MATTER WHAT BUSINESS THE CASH IS KING AND NOW THEY DON'T HAVE ...THEY HAVE TO GO BACK AND DO SOME DEBT FINANCING WHICH MAKES MUCH MORE DIFFICULT BUISINESS TO RUN. SO HOW CAN PRODUCERS MANAGE THROUGH THIS RIGHT THEY HAVE TO BE A LOT SMARTED ABOUT THINGS WE HAVEN'T DONE BEFORE. WE'RE ALL GENIUSES AT HIGH CORN AND HIGH CORN PRICES OR HIGH SOYBEAN PRICES NOW WE HAVE TO THINK ABOUT WHAT ARE OR UNDERSTAND OUR COST MANAGED TO THE MARGINS AND THEN THAT MAKES MARKETING PLAN THERE. ALSO LOOK AT THE TECHNOLOGY IT'S EXPENSIVE YES.
COMMODITY PRICES SHRINK IN THE GROCERY STORE:
LOWER COMMODITY PRICES ARE ALSO BEING FELT AT THE SUPER MARKET...AS FOOD PRICES DROP. CURRENTLY THE U.S. IS ON PACE TO SEE THE LONGEST STRETCH OF FALLING FOOD PRICES IN MORE THAN 50 YEARS. THE PRICE FOR A GALLON OF MILK FELL 11 PERCENT FROM LAST YEAR TO $3.06 IN JULY. THE PRICE FOR A DOZEN EGGS FELL 40 PERCENT TO $1.55 IN THE SAME PERIOD. THE CURRENT FOOD PRICE SLUMP COULD BEAT THE NINE MONTHS OF DECLINES SEEN BACK IN 2009-2010. FIRST CHEESE NOW EGGS.
USDA TO PURCHASE FOOD TO COUNTER SURPLUS:
THE USDA RECENTLY ANNOUNCING IT WILL PURCHASE $11 POINT 7 MILLION WORTH OF SHELL EGGS AND EGG PRODUCTS TO EASE A SURPLUS AS FARMERS AND EGG PROCESSORS TRY TO COPE WITH FALLING PRICES. USDA SAYS THE PRODUCTS WILL GO TO VARIOUS FOOD NUTRITION ASSISTANCE PROGRAMS, AND TO CHARITABLE INSTITUTIONS. LAST MONTH--USDA ANNOUNCED THE AGENCY WOULD PURCHASE $20 MILLION WORTH OF CHEESE TO HELP RELIEVE PRESSURE ON THE DAIRY INDUSTRY AFTER ANONYMOUS THREATS FORCED USDA TO CLOSE SEVERAL OFFICES IN FIVE STATES TUESDAY, THE AGENCY RE-OPENED THOSE DOORS.
OBAMA TO SPEAK ON TPP DURING TRIP TO ASIA:
ALSO OUT OF WASHINGTON, THE PRESIDENT HOPING TO MAKE THE CASE FOR TPP DURING HIS UPCOMING TRIP TO ASIA. HE'S PLANNING A SPEECH IN LAOS ADDRESSING THE 12 NATION TRADE PACT. A WHITE HOUSE SPOKESMAN SAYS THE PRESIDENT BELIEVES THERE STILL IS A PATH TO GETTING TPP DONE BEFORE LEAVING OFFICE. JUST LAST WEEK, SENATE MAJORITY LEADER MITCH MCCONNELL SAID HIS CHAMBER WOULD NOT BE VOTING ON TPP THIS YEAR. FARM GROUPS SAY RIGHT NOW THE PROSPECTS DON'T LOOK GOOD. " WELL YOU KNOW WE TOOK A BLOW LAST WEEK WHEN MAJORITY LEAD MCCONELL SAID HE WASN'T GOING TO BRING IT UP ON THE SENATE FLOOR. WE KNOW NEITHER MAJOR PRESIDENTIAL CANDIDATES HAVE BEEN SUPPORTIVE. BUT I THINK OUR CHANCES WERE SLIM BEFORE. THEY'RE NOW EVEN SLIMMER. DOESN'T MEAN WE'VE GIVING UP HOPE, WE CONTINUE TO WORK ON IT BUT IT'S GOING TO BE A REALLY REALLY TOUGH ROAD NOW."
CROP COMMENTS:
MIKE HOFFMAN CHECKING ON CROP CONDITIONS AND CROP PROGRESS IN THIS MORNING'S CROP COMMENTS. GOOD MORNING MIKE. GOOD MORNING CLINTON. HELLO CLINTON. CORN HARVEST IS NOW GETTING UNDERWAY IN THE BLUE GRASS STATE. THE NASS OFFICE REPORTS THAT TWO PERCENT IS NOW SHELLED. THAT'S A BIT BEHIND THE FIVE YEAR AVERAGE. IT LOOKS LIKE KENTUCKY HAS A GOOD CORN CROP. 75 PERCENT IS RATED GOOD TO EXCELLENT. AND A REMINDER TO EVERYONE BE SURE TO POST SOME PHOTOS OF HARVEST FROM YOUR STATE ON OUR CROP COMMENTS PAGE.
TEASE:
AND LATER WE'LL CHECK ON THE CATTLE MARKET INCLUDING THE THEFT OF 500 COWS FROM A FARM IN NEW ZEALAND. AND LATER THE VICTIMS OF NATURAL DISASTER AREN'T ALWAYS JUST PEOPLE. WE'LL MEET FARMERS TRYING TO CARE FOR THEIR CATTLE FOLLOWING A VIOLENT EARTHQUAKE IN ITALY.
FROM THE FLOOR OF THE CME:
IN AGRIBUSINESS IT'S BEEN AN INTERESTING WEEK IN MARKETS. LETS HEAD TO THE FLOOR OF THE CME IN CHICAGO AND CHECK IN WITH TODD BUBBA HORWICZ FOR A RECAP OF WEDNESDAY'S TRADE. NOT A HECK OF A LOT GOING ON. WE'RE NEARING OBVIOUSLY A LABOR DAY HOLIDAY UNDER SEVERE PRESSURE EVERY DAY WERE NOW DOWN SEVEN DAYS IN A ROW THERE'S GOING TO BE A BOUNCER WHETHER IT BE TOMORROW OR WHATEVER IT'S COMING UP TO SEPTEMBER IS COMING OFF THE BOARD WE MIGHT GET A LITTLE BIT OF A SQUEEZE HERE AND LOOK FOR A RALLY BUT I'M REALLY MORE INTERESTED IN HOW THE RALLY REACT  I'M NOT INTERESTED IN JUST GETTING LONG OBVIOUSLY AS A TRADER I MIGHT BE WILLING TO TAKE A CHANCE DOWN HERE JUST LOOK FOR A SPOT TO BUY AND GET LONG BUT OVERALL LONGER TERM I WANT TO SEE HOW THIS RALLY THAT WE'RE GONNA GET HOW THE MARKET REACTS TO.
AGRIBUSINESS:
AS WE MENTIONED YESTERDAY, ONE OF THE LEADING ANALYTICAL FIRMS IN THE COUNTRY JUST RELEASING THE RESULTS OF ITS ANNUAL YIELD REPORT. ALLENDALE INCORPORATED SURVEYS MEMBERS IN 31 STATES...INCLUDING 12 KEY STATES IN THE MIDWEST, ALLENDALE PROJECTS THE AVERAGE CORN YIELD AT ONE-HUNDRED-72-POINT SIX BUSHELS AN ACRE, PRODUCING 14-POINT NINE BILLION BUSHELS. THAT ESTIMATE IS LOWER THAN THE AUGUST PROJECTION FROM USDA. AND HIGHER THAN PROFARMER'S ESTIMATE WHICH WAS RELEASED LAST WEEK AS PART OF THE PROFARMER MIDWEST CROP TOUR.
FOOTBALL FORECAST:
WELCOME BACK TO AGDAY YOU KNOW MIKE WHAT TIME IT IS? IT'S FOOTBALL SEASON. THE FOOTBALL SEASON. THAT'S RIGHT BOTH OF US WENT TO LAND GRANT UNIVERSITIES " AND WE THOUGHT WHY NOT DO SOME FOOTBALL FORECAST FOR LAND GRANTS THIS FALL. SO YOU'RE GOING KICK US OFF. WE'LL START WITH OUR TWO. FIRST OF ALL MINE. HOPEFULLY IT'S BETTER THIS YEAR. TAKE A LOOK AT EASTERN KENTUCKY AT PURDUE. NOON KICKOFF BEAUTIFUL DAY SUNNY AND BEAUTIFUL. I'LL BE IN THE STANDS AS WELL SEVENTY AT KICKOFF SEVENTY EIGHT BY THE FOURTH QUARTER.
NATIONAL WEATHER:
SOUTHEASTERN LOUISIANA AT OKLAHOMA STATE SUNNY AND PLEASANTLY WARM THAT'S NICE FOR STILLWATER EIGHTY FOUR KICKOFF. EIGHTY ONE BY THE FOURTH QUARTER. NOW THE WEATHER MAP THERE'S WHAT IT LOOKS LIKE. THERE'S A LOT GOING ON AS YOU CAN SEE. OBVIOUSLY THE ELEPHANT IN THE ROOM IS TROPICAL STORM HERMINE AND BOY IT JUST DEPENDS ON EXACTLY WHERE THE SAYING GOES WHO GETS ALL THE RAIN FROM IT BUT YOU CAN SEE OUR COMPUTER MODEL IS TAKING IT UP TOWARD THE PANHANDLE OF FLORIDA A LITTLE FARTHER WEST THAN IT WAS THINKING YESTERDAY. ALONG THIS COLD FRONT FARTHER NORTH THIS IS A BIG CHANGE IN THE AIR MASS. THIS IS COOL DRY AIR ACROSS MOST OF THE NORTHERN PLAINS CENTRAL PLAINS FOLKS ARE GONNA FEEL IT BUT YOU WILL NOTICE HOW HERMINE IS NOW PROJECTED TO COME INTO THE GULF COAST AREA OF FLORIDA THE PANHANDLE AREA AND EXACTLY HOW FAR WEST WILL MAKE A BIG DIFFERENCE IN WHO GETS ALL THE WIND WHO GETS ALL THE RAIN. EVENTUALLY THOUGH THIS THING DOES GET TANGLED UP WITH A COLD FRONT COMING NORTHWARD.SO I HAVE TO SEE HOW THAT TERM PROJECTS THAT BACK OUT OVER THE WESTERN PORTIONS OF THE ATLANTIC AS WE HEAD INTO THIS HOLIDAY WEEKEND. THAT COULD BE A BIG BIG DEAL FOR THE MID ATLANTIC AND PARTS OF THE NORTHEAST.
REGIONAL WEATHER:
THAT'S A LOOK ACROSS THE COUNTRY NOW LET'S TAKE A LOOK AT SOME LOCAL FORECASTS. FIRST OF ALL FOR SALT LAKE CITY UTAH PARTLY SUNNY HOT AND HUMID HIGH OF NINETY FOUR DEGREES. LITTLE ROCK ARKANSAS NOT AS HOT A THUNDERSTORM IN SOME AREAS HIGH OF EIGHTY SIX. AND HARRISBURG PENNSYLVANIA INCREASING SUN AND A LESS HUMIDITY HIGH OF EIGHTY THREE DEGREES.
TEASE:
UP NEXT THE FOLKS OVER AT DROVERS JOINS US TO CONTINUE THE TRANS PACIFIC PARTNERSHIP DISCUSSION AND WHY NCBA IS SUPPORTING THE DEAL. AND LATER, WHEN DISASTER STRIKES LIVESTOCK ARE OFTEN VICTIMS RIGHT ALONG WITH THEIR OWNERS. WE'LL TRAVEL TO ITALY TO SEE HOW DAIRY FARMERS ARE WORKING TO CARE FOR THEIR HERDS FOLLOWING A MASSIVE EARTHQUAKE.
DROVERS:
ON DROVERS TV, BALANCE SHEETS AT AMERICAN FEEDYARDS CONTINUE TO BLEED RED. ACCORDING THE LATEST STERLING PROFIT TRACKER, A THREE DOLLAR DROP IN AVERAGE CASH FED CATTLE PRICES PUT CLOSEOUTS NEARLY 60 DOLLARS SHORT OF BREAKEVEN. THAT'S DOWN ANOTHER 7 DOLLARS COMPARED TO LAST WEEK. EVEN LOWER FEED COSTS WERE ENOUGH TO STEM THE DECLINE. THE TOTAL COST TO FINISH A STEER NOW AVERAGES ABOUT 16-HUNDRED AND 50 DOLLARS. LAST YEAR IT WAS MORE THAN 21-HUNDRED DOLLARS PER HEAD.
WITH STRONG SUPPLIES HEADING INTO THE FALL FLUSH, STRONG BEEF EXPORTS COULD HELP DRIVE PRICES HIGHER. THAT'S ONE REASON THE NATIONAL CATTLEMEN'S BEEF ASSOCIATION IS STRONG SUPPORTER OF THE TRANSPACIFIC PARTNERSHIP.
TPP IMMENSE OPPORTUNITY:
THEY CALL THE 12 NATION TRADE PACT THEIR TOP PRIORITY. NCBA'S PRESIDENT TRACY BRUNER TOLD RANCHERS ATTENDING A KANSAS LIVESTOCK ASSOCIATION FIELD DAY THAT THE TRANS-PACIFIC PARTNERSHIP IS THE "TRADE OPPORTUNITY OF TODAY" FOR THE BEEF INDUSTRY. IF APPROVED BY CONGRESS, TPP WOULD REDUCE TARIFFS ON U.S. BEEF EXPORTED TO JAPAN FROM 38.5% TODAY TO 9% OVER 16 YEARS. THIS WOULD LEVEL THE PLAYING FIELD WITH AUSTRALIAN PRODUCERS, WHO CURRENTLY ENJOY AN ADVANTAGE OF 10 PERCENTAGE POINTS OVER THE U.S. ON BEEF EXPORTS TO JAPAN.
BRUNNER TELLS DROVERS THEY BELIEVE THERE WILL BE AN OPPORTUNITY FOR A VOTE IN CONGRESS BEFORE THE END OF THE YEAR, DESPITE ELECTION YEAR RHETORIC.
STOLEN CATTLE IN NEW ZEALAND:
NEW ZEALAND POLICE ARE INVESTIGATING A LARGE CASE OF CATTLE RUSTLING, INVOLVING 500 COWS. LOCALS SAID THEY'D NEVER BEFORE HEARD OF CATTLE RUSTLING ON SUCH A MASSIVE SCALE -AND THAT'S IN A NATION THAT'S HOME TO SOME 10 MILLION COWS -WHICH IS DOUBLE THE NUMBER OF PEOPLE. POLICE THINK THE COWS COULD HAVE BEEN TAKEN FROM THE HERD OF 13HUNDRED OVER THE PAST MONTH. WHAT TIPPED THEM OFF? THE FARMER NOTICED THE HERD WASN'T CHEWING THROUGH AS MUCH FEED AS NORMAL.  THE OWNERS STARTED TO GET REALLY WORRIED ONCE CALVING GOT UNDERWAY, HOW MANY COWS WERE THERE, AND IT JUST DIDN'T STACK UP. THE NUMBERS DIDN'T STACK UP. POLICE BELIEVE THE COWS MAY NOT HAVE BEEN TAKEN ALL AT ONCE. THEY SAY THE TRACTOR-TRAILER WOULD NEED TO BE LOADED 13 TIMES TO MOVE THAT MANY.
TEASE:
STILL TO COME -THE FORGOTTEN VICTIMS OF AN EARTHQUAKE -AND THE HELP THAT FARMERS NEED.
IN THE COUNTRY:
LOST AMONG THE HUMAN TOLL OF LAST WEEK'S DEADLY EARTHQUAKE IN ITALY ARE THE FORGOTTEN AND MISPLACED LIVESTOCK...ESPECIALLY DAIRY HERDS. FARMERS IN CENTRAL ITALY ARE STRUGGLING TO FIND SHELTER FOR THEIR ANIMALS IN THE WAKE OF THE EARTHQUAKE THAT DEVASTATED THREE TOWNS. IN THIS VILLAGE, A FARMER'S DAUGHTER WAS HELPING TEND TO THE FAMILY'S 22 COWS AFTER THE BARN WAS SEVERELY DAMAGED. THE MECHANICAL MILKING SYSTEM IS NO LONGER WORKING AND THERE'S NO PLACE TO SHELTER THE ANIMALS. IN A NEIGHBORING VILLAGE, FIVE DAIRY WORKERS FLED THE AREA, LEAVING THE FARMER SHORTHANDED TO MILK HIS 180 COWS. THERE'S A CONCERN THE COWS COULD DEVELOP MASTITIS IF A MILKING ROUTINE IS NOT IN PLACE SOON.
CLOSING:
THAT'S ALL THE TIME WE HAVE THIS MORNING. WE'RE GLAD YOU TUNED IN. FOR TYNE MORGAN AND MIKE HOFFMAN, I'M CLINTON GRIFFITHS. HAVE A GREAT DAY.
PROMO:
I'M CLINTON GRIFFITHS. FRIDAY ON AGDAY WITH WINTER WHEAT PLANTING GETTING READY TO START-UP, WE'LL HAVE AGRONOMIC TIPS FROM THE EXPERTS AT FARM JOURNAL COLLEGE. PLUS BRITISH AND AMERICAN FARMERS SHARE A COMMON CHALLENGE -A SHORTAGE OF FIELD WORKERS. TUNE IN WEEKDAYS FOR AGDAY.

 

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