TODAY ON AGDAY:
April 5, 2011
BULL MARKET MIRROR
Nearly everyone remembers the bull market of 2008. Minneapolis wheat surged to a record 25 dollars and June corn jumped over 8. But the rise was short lived. Markets crashed under the weight of a world economic recession. So could the bull of 2011 suffer the same fate? Agday's Michelle Rook takes a look at the similarities and differences in these two markets. Thanks Michelle. Experts are always concerned with unforseen global events like unrest in the middle-east or the earthquake in japan. That's why many investors liquidated their long positions recently. There's also concern over global food inflation triggering a change in ethanol policy. That would be negative for the corn market.
ETHANOL SUBSIDY BILL
Ethanol policy continues to be hot topic in Washington. It appears Oklahoma senator Tom Coburn has withdrawn an amendment to repeal the ethanol blender's tax credit...also known as VEETC. The amendment was made to the small business bill. Iowa senator and ethanol Propent Chuck Grassly and other corn country legislators blocked a vote on the amendment. Coburn has since pulled the repeal off the table but says he's not giving up.
CATTLE ON FEED
Grains will once again be under the microscope as the USDA releases its supply demand numbers later this Friday. Also coming out is the monthly cattle on feed report. Analysts say this may be the first indication of how tight supplies really are. Many expect to see fewer cattle entering feedlots than the year before.
In our dairy today report...our partners at dairy today magazine say a new study reveals genetically modified corn has no obvious effect on dairy cows. The study-- published in the April issue of the journal dairy science-- says GMO hybrids that are roun- up ready and resistant to western corn rootworm show no difference in milk yield or components. The study, done by Kansas state university and pioneer hybrid, used 30 holstein cows. They were fed identical levels of corn silage and feed--one GMO hybrid the other GMO free. Milk production efficiency was basically the same...as were all other measurements. Researchers say the hybrids have no detectable effect on the productive performance of lactating dairy cows.
After higher milk price in March, market numbers have cooled. In March, prices hit their highest point since June of 2008. The March class three base prices hovered around 19-40 per hundred weight. That's nearly two and half dollars above February prices and more than six and half above last year. These are the highest class three numbers in two years. While profit margin improved slightly in February, continued increases in feed costs are keeping margins razor thin.
In analysis this morning, Al Pell and Dustin Johnson of E-Hedger revisit last week's grain stocks report for a discussion on the direction markets could move going forward.
ITC: POWER U
As most teachers will tell you, getting kids refocused after spring break can be a challenge. Its about, reestablishing that routine ---with lessons in reading, math and science. However, many elementary students in Tennessee are learning unconventional lessons about the benefits of exercise and good nutrition. Chuck Denney with the University of Tennessee reports on a program working to change the health of a generation.
In food and your family this morning how closely do you watch calorie and nutrition labels? The FDA is considering a proposal to add calorie labeling to foods sold in more places hoping Americans will make healthier choices. The proposal would put labels on foods sold in vending machines and on restaurant menus at chain restaurants with 20 or more locations. The FDA says American's now eat about a third of their total calories outside of home. It hopes the easy to understand nutrition information will help people make smarter choices. Places that serve food as a secondary activity like airplanes and movie theatres would be exempt. This labeling idea isn't new. In fact many states already do it. But how well does it work? A study by market research firm, the NPD group says adding calorie information to menus will like have very little impact on consumer ordering over the long term. It shows people only reduced their intake by about 100 calories and still ordered the same number of items.