AgDay Daily Recap - September 13, 2011

September 13, 2011 05:23 AM
 

TODAY ON AGDAY:
SEPTEMBER 13, 2011

USDA REPORTS:
GOOD MORNING. USDA'S CROP PRODUCTION REPORT CONFIRMED WHAT WE FOUND ON THE PRO-FARMER CROP TOUR TWO WEEKS AGO - A SMALLER U.S. CORN CROP. WE HAVE IN-DEPTH COVERAGE OF THE REPORTS, BUT LET'S BEGIN WITH THE NUMBERS.

CROP PRODUCTION:
USDA NOW SAYS U.S. FARMERS WILL PRODUCE JUST UNDER 12.5 BILLION BUSHELS OF CORN, A REDUCTION OF MORE THAN 400 MILLION BUSHELS FROM ITS AUGUST FORECAST. THE AVERAGE YIELD FORECAST WAS ALSO LOWERED - BY FIVE BUSHELS. THIS CROP WOULD STILL BE BIGGER THAN LAST YEAR AND THE THIRD LARGEST ON RECORD. NOW TO SOYBEANS, USDA INCREASED THE SIZE OF THE CROP FROM ITS AUGUST REPORT. THE AG DEPARTMENT PUTS SOY AT 3.08 BILLION BUSHELS, BASED ON AN AVERAGE YIELD OF 41.8 BUSHELS AN ACRE, UP ABOUT A HALF BUSHEL FROM AUGUST.

CORN SUPPLIES:
BECAUSE OF THE LOWER PRODUCTION ESTIMATES, USDA LOWERED CARRYOVER. NEW-CROP CORN CARRYOVER IS DOWN 42 MILLION BUSHELS FROM AUGUST. TOTAL SUPPLIES ARE DOWN 442 MILLION BUSHELS, THE RESULT OF THE CUT TO THE CROP. PRO FARMER EDITOR CHIP FLORY BREAKS IT ALL DOWN, CHIP.

OHIO ST ECONOMIST:
FOR MONTHS WE'VE BEEN DISCUSSING THE POSSIBILITY OF DEMAND-RATIONING DUE TO THE SMALLER CROP. BUT COULD THE INDUSTRY BE OVER-RATIONING? AFTER POURING OVER THE NUMBERS, AG ECONOMIST MATT ROBERTS FROM OHIO STATE SAID IT'S A POSSIBILITY.

CROP PROGRESS:
ON MONDAY, USDA ALSO RELEASED ITS WEEKLY CROP PROGRESS REPORT WHICH SHOWS ABOUT A THIRD OF THE CORN CROP IS MATURE. IT'S FOUR POINTS BEHIND THE AVERAGE PACE. LAST YEAR, HALF OF THE CORN WAS ALREADY MATURE. CONDITION-WISE, IT BOUNCED UP A POINT FROM A WEEK AGO. WINTER WHEAT PLANTING IS NOW UNDERWAY. IN THE FIRST REPORT OF THE SEASON, USDA SAYS 6% IS SEEDED. THE AVERAGE IS 10%. STATE BY STATE, KANSAS IS AT 3%, OKLAHOMA AT ONE, TEXAS AT 2%, AND MONTANA AT 6%. THE SOYBEAN CROP IS SLOW TO MATURE. THE AG DEPARTMENT SAYS 15% IS DROPPING LEAVES. THE FIVE YEAR AVERAGE IS 27%. THE BIGGEST DELAYS ARE IN OHIO, MINNESOTA AND NORTH DAKOTA.

DTR WASDE MILK PRODUCTION:
IN OUR DAIRY TODAY REPORT, USDA'S SUPPLY DEMAND NUMBERS ALSO INCLUDES DAIRY. THE DEPARTMENT IS RAISING ITS 2011 MILK PRODUCTION FORCAST TO 195.7 BILLION POUNDS. BEHIND THE FORCAST...A MORE RAPID-THAN-EXPECTED EXPANSION IN THE SIZE OF THE NATION'S DAIRY HERD. LOOKING TO 2012--USDA LOWERED ITS PROJECTED MILK OUTPUT. IT'S GUESSING HIGHER FEED COSTS WILL SLOW THE RATE OF GROWTH OF MILK PER COW.

DTR SOFTENING PRICES:
THE USDA ALSO LOWERED ITS 2011 PRICE FORECAST TO 20-15 TO 20-35 PER HUNDRED WEIGHT. BUT THINGS SOFTEN UP EVEN MORE IN 2012.
PRICES ARE EXPTECTED TO RANGE FROM $17.80 TO $18.80. MEANWHILE IN CHEESE MARKETS, PRICES ARE FALLILNG. CHEESE HAS DROPPED OFF AUGUST HIGHS...TRADING IN THE $1.79 RANGE. HELPING SUPPORT THESE PRICES...STRONG CHEESE EXPORTS.

DTR MIKE HOGAN EXPORTS:
MIKE SAYS WITH INPUTS STAYING WHERE THEY ARE, PRODUCERS CAN MAKE MARGINS WORK WITH A MILK PRICE IN THAT 17 DOLLAR RANGE.
IF CORN GOES TO 9 OR 10 DOLLARS, HOGAN SAYS MILK NEEDS TO SELL AT OR ABOVE $18.50. MIKE RETURNS IN OUR NEXT SEGMENT AS HE AND AL PELL DISCUSS THE WEAK DOLLAR AND ITS POSITVE IMPACT ON EXPORTS OF U.S. AG PRODUCTS.

DTR NEW YORK DISCHARGE:
MEANWHILE, LARGER DAIRY PRODUCERS IN NEW YORK STATE ARE GETTING A BREAK FROM ENVIRONMENTAL REGULATIONS AFTER FLOODING FROM TROPICAL STORM LEE. THE STATE'S DEPARTMENT OF ENVIRONMENTAL CONSERVATION IS GIVING POLLUTION EXEMPTIONS TO DAIRIES IN 15 COUNTIES. THE EXHEMPTIONS INCLUDE DISCHARGES OF LAGOON WATERS, PUTTING WASTE MILK INTO LAGOONS, EVEN LAND APPLYING THAT MILK IF THERE'S A DANGER OF A LAGOON OVERFLOW.  PRODUCERS DO STILL HAVE TO SUBMIT AN INCIDENT REPORT WITHIN FIVE DAYS. AND DON'T FORGET, FOR THE VERY LATEST NEWS AFFECTING THE DAIRY INDUSTRY, INCLUDING PRODUCTION AND POLICY ISSUES, CHECK OUT WWW.DAIRYTODAY.COM.

TEXAS FIRES:
TEXAS CONTINUES TO BATTLE A MASSIVE WILDFIRE SOUTHEAST OF AUSTIN. 34,000 ACRES AND MORE THAN 1,500 HOMES HAVE BURNED.  FOR MONTHS NOW TEXAS HAS BATTLED WILDFIRES THANKS TO A HISTORIC DROUGHT. AND MANY TIMES ON THE FRONTLINES ARE VOLUNTEER FIREFIGHTERS. ACCORDING TO THE TEAS FARM BUREAU, NEARLY 13,000 FIRES HAVE BURNED MORE THAN THREE MILLION ACRES IN TEXAS SINCE LAST NOVEMBER. AS A RESULT, FUNDS ARE RUNNING DRY. TO HELP OUT THOSE VOLUNTEER ORGANIZATIONS, COUNTY FARM BUREAU OFFICES HAVE DONATED $150,000 DOLLARS. THOSE DOLLARS ARE MATCHED THREE- FOR-ONE BY THE TEXAS FARM BUREAU. THAT BRINGS THE TOTAL IN DONATIONS TO MORE THAN A HALF MILLION DOLLARS. LAST WEEK, THE FEDERAL GOVERNMENT DECLARED TEXAS A DISASTER AREA--FEMA WILL NOW HELP INCURE 75% OF THOSE FIRE FIGHTING COSTS.

ANALYSIS:
MIKE HOGAN

IN THE COUNTRY; CHEESE INTERNSHIPS:
AS MOST YOUNG GRADUATES EVENTUALLY LEARN, IT’S HARD TO FIND A JOB WITHOUT REAL WORLD EXPERIENCE. WHICH IS WHY INTERNSHIPS ARE SO VALUABLE. THE SAME IS TRUE FOR LICENSED CHEESEMAKERS IN WISCONSIN--LOTS OF COURSEWORK PLUS AN APPRENTICESHIP. IN THIS REPORT FROM THE WISCONSIN DAIRY NEWS, WE LEARN HOW ONE IS FAMILY TAKING ON INTERNS AND HELPING TRAIN THE NEXT GENERATION OF CHEESEMAKERS. THE CHEESEMAKING INTERNSHIP IS A WIN FOR EVERYONE...HARMONY GETS PART-TIME HELP AND THE INTERN GETS THE EXPERIENCE THEY NEED. FOOD AND YOUR FAMILY IS NEXT.

STEVIA MARKET SHARE:
WORLD LIKES ITS SWEETS AND A RELATIVELY NEW SWEETNER IS SET TO STORM THE MARKET THIS YEAR. IN FOOD AND YOUR FAMILY, STEVIA, A NATURAL SWEETNER MADE FROM THE LEAF OF THE STEVIA PLANT--IS GAINING MARKETSHARE AT A RAPID PACE. COMPARED TO SUGAR, STEVIA EXTRACT IS THREE-HUNDRED TIMES SWEETER. THAT'S MAKING IT ATTRACTIVE TO FOOD PRODUCERS. A NEW REPORT ON SUGAR AND SWEETNER TRENDS SHOWS SALES OF STEVIA WILL GO FROM 210 MILLION DOLLARS LAST YEAR TO NEARLY 1.2 BILLION THIS YEAR. THAT WOULD GIVE IT MORE THAN 9 PERCENT OF THE MARKET. BY COMPARISON, CORN SWEETNERS HOLD ABOUT 15%. HELPING PUSH THAT STEVIA TREND, FOOD MAKERS CONTINUE TO PUMP OUT NEW PRODUCTS SWEETENED WITH STEVIA.

CHERRY EXPORTS:
THERE'S A NEW EXPORT MARKET FOR U-S CHERRIES. THE AG DEPARTMENT ANNOUNCED MONDAY THAT THE FRUIT CAN NOW BE EXPORTED TO WESTERN AUSTRALIA. U.S. CHERRIES ALREADY GET SHIPPED TO EASTERN AUSTRALIA, BUT THE WESTERN MARKET WAS OFF-LIMITS WHICH MAINTAINS ITS OWN FOOD-SAFETY GUIDELINES. USDA SAYS IT'S BEEN NEGOTIATING WITH AUSTRALIA'S "BIO-SECURITY" OFFICE FOR TEN YEARS. THE AG DEPARTMENT SAYS THE AUSTRALIAN DOLLAR HAS STRENGTHENED AGAINST THE U.S. DOLLAR OVER THE PAST TWO YEARS, MAKING IMPORTS MORE AFFORDABLE. SINCE U.S. CHERRIES ARE COUNTER-SEASONAL TO THE AUSTRALIAN CROP, THE PRODUCTS DO NOT COMPETE DIRECTLY IN THE MARKETPLACE.

CONTACT PAGE:
WE'D LOVE TO HEAR FROM YOU! CONTACT US AT 800-7-9-2-43-29. OR DROP AN EMAIL TO INBOX@AGDAY.COM. YOU CAN ALSO CHECK US OUT ON SOME OF THAT NEW TECHNOLOGY, AT WWW.FACEBOOK.COM/AGDAY.
 

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