Evening Report -- Advice (VIP) -- September 5, 2013

September 5, 2013 10:40 AM
 

NITROGEN ADVICE FOR CORN PRODUCERS... Pro Farmer Inputs Monitor has advice on covering fall anhydrous needs. Inputs Monitor subscribers should go to your website for details on booking fall nitrogen needs.

 

 

MIDWEST DROUGHT INTENSIFIES... According to the National Drought Monitor, the drought in the Midwest increased in intensity, though it remained about the same in terms of its area compared with the week prior. Today's update shows 48.5% of the Midwest is impacted by some form of drought, with 28.8% now in "moderate" drought (25% last week) and 7% is in "severe" drought (3.7% last week). This week's update states, "Well-above-normal temperatures (6° to 10° F), continued lack of rain, and record to near-record low August rainfall in some areas has led to rapidly declining topsoil moisture conditions in parts of the Midwest."

The monitor notes that the region from the eastern Dakotas southeast into western Illinois has gone from no drought to moderate or severe drought since mid- to late-July thanks to 25% to 50% of normal rainfall. "Some portions in central Iowa and northern Missouri have measured between 5% and 25% of normal, with some stations in the latter area recording under 0.1" of rain during August," the monitor details. Statewide August rainfall for Iowa ranked the seventh driest in 141 years of records and this followed the ninth driest July.

Not surprisingly, severe drought expanded or was added in southern Iowa, western Illinois northern Missouri, western Wisconsin and central Minnesota. Abnormally dry to moderate drought conditions increased in parts of Wisconsin, Illinois and Indiana. Some northern areas of Minnesota, Wisconsin, and Illinois as well as southern areas of Indiana did see some improvement thanks to beneficial rain. Get more details and see the maps.

 

 

CPC: ENSO-NEUTRAL TO CONTINUE THROUGH WINTER... Similar to last month, the National Weather Service's Climate Prediction Center (CPC) says it expects ENSO-neutral conditions to continue through winter. CPC also noted near-average sea surface temperatures continued during August. "The oceanic heat content (average temperature in the upper 300m of the ocean) remained near to slightly above average during August, due to the persistence of above-average sub-surface temperatures across much of the eastern half of the Pacific," CPC explains. "The low-level and upper-level winds were near average across the equatorial Pacific. Convection continued to be enhanced over Indonesia and suppressed in the central and eastern Pacific. Collectively, these atmospheric and oceanic conditions reflect ENSO-neutral," it continues. Learn more.

 

 

SUGAR PROCESSORS DEFAULT ON $35 MILLION OF FEDERAL LOANS... Sugar processors forfeited about 85,000 MT of sugar as they defaulted on roughly $34.6 million in outstanding federal loans that were due at the end of August, according to USDA. This marks the first defaults for the U.S. sugar industry since 2004. USDA has already spent $53.4 million buying sugar this year as part of the U.S. sugar program. A record U.S. sugar beet crop and record sugar cane crops from both the U.S. and Mexico have pushed domestic prices down more than 30% from last year and well below the Sugar Program support level, according to USDA's statement. Around $306.7 million, or 675,650 MT of sugar, are still outstanding as collateral against loans due at the end of this month, according to Reuters. This spring USDA estimated that losses on the sugar loan program would total $80 million.

 

 

U.S. BEEF & PORK EXPORTS RISE IN JULY... U.S. beef and pork exports continued their rise in July, with beef sales hitting their highest level of the year, according to analysis of USDA statistics by the U.S. Meat Export Federation (USMEF).

Double-digit increases to the top three markets of Japan, Mexico and Canada helped beef exports to surge 9% in volume in July to 118,913 MT valued at $622.8 million -- a 21% increase relative to year-ago. Beef exports are up fractionally in terms of volume and 9% in terms of value for the first seven months of the year.

A rebound in the Mexican market, strong variety meat demand in the China/Hong Kong region and rapid growth in both Central/South America and the ASEAN region lifted pork exports by 8.5% in volume in July to 178,794 MT valued at $502.6 million -- up 7.5% from 2012, according to the USMEF. Through the first seven months of the year, pork exports are down 5% in volume and value at 1.23 MMT and $3.44 billion, respectively, compared to last year's record-setting pace.

Of note, if one excludes Russia from this data (the country has been closed to U.S. beef and pork exports since February), pork exports were down just 1%. Read more highlights.

 

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