Evening Report (VIP) -- April 8, 2014

April 8, 2014 10:26 AM
 

Winter wheat crop conditions plunge... As expected, USDA's first national winter wheat crop condition update since Nov. 24, 2013, reflected major declines in the condition of the crop. USDA now pegs 29% of winter wheat in "poor" to "very poor" condition, versus 8% in these categories in the last update of 2013. While 62% of the crop was rated in "good" to "excellent" condition before it entered dormancy this fall, just 35% of the crop is now rated as such. The following states have a third or more of the crop rated in "poor" to very poor" condition: Colorado (33%), Oklahoma (48%) and Texas (61%).

Winter Wheat

very poor

poor

fair

good

excellent

This week

10

19

36

30

5

Nov. 24, 2013

2

6

30

53

9

Year-ago

12

18

34

31

5

 

Cotton planting off to normal start... USDA reports cotton planting as of April 6 stands at 6% complete, which is up 1 point from last year at this time and in-line with the five-year average pace. Arizona leads the way with planting 31% complete. In Texas, 10% of the cotton crop is seeded, which is one percentage point ahead of the five-year average pace.

 

South American crop estimates unchanged... Weather conditions have shifted in South America, with Argentina experiencing heavy rainfall over the past weekend and conditions turning drier in central Brazil. Conditions haven't shifted enough yet to cause Pro Farmer South American Consultant Dr. Michael Cordonnier to adjust his Brazilian or Argentine crop estimates this week. But Dr. Cordonnier feels Argentina will lose some soybeans to the heavy late-season rains and flooding. He is also going to keep a close watch on the sudden switch to drier conditions in central Brazil as more than half of the Brazilian corn crop is safrinha (second crop) production.

Dr. Cordonnier's Brazilian estimates are 86.5 MMT for soybeans and 70 MMT for corn. In Argentina, he estimates the soybean crop at 54 MMT and the corn crop at 23.5 MMT.

USDA will update its South American crop estimates Wednesday. Conab, the Brazilian equivalent of USDA, will release its Brazilian crop estimates Thursday.

 

Argentine strike planned for Thursday... Union workers around Rosario, Argentina's main grain export hub, are planning a one-day strike Thursday as they seek higher wages in response to 30% inflation in the country. The strike will include roadblocks. Dr. Cordonnier says this should be a temporary strike, though it could escalate into a bigger issue as union workers will not get their full wage demands. This is something to keep an eye on as the Argentine export season will soon hit full gear.

 

U.S./Japan remain at odds regarding tariffs on farm trade... In "First Thing Today," we reported Australia and Japan reached a bilateral economic agreement in which Japan reduces but does not eliminate some of its agricultural tariffs. Meanwhile, Japanese and U.S. senior government officials reopened their Trans Pacific Partnership (TPP) trade negotiations Monday. Reports note that Japan has maintained its position of refusing to eliminate tariffs in the five sensitive agricultural areas while demanding that the U.S. abolish its tariffs on Japanese automobiles. Some U.S. farm groups are insisting that Japan eliminate their tariffs in any TPP accord.

U.S.-Japan talks have been at odds over tariffs on farm trade, with Japan wanting to keep some tariffs at reduced levels. Some Washington observers say that if Japan does not go far enough on market access in farm and auto markets, the result will be more lawmaker opposition against any final TPP. "The outcome in the Australia-Japan agreement is significantly less ambitious than leaders agreed to seek in the Trans-Pacific Partnership," said a spokesman for U.S. Trade Representative Mike Froman, a clear signal that more will be needed from Japan relative to ongoing trade talks with the United States. Learn more.

 

USDA "officially" announces sign-up date for farmer/rancher disaster assistance programs... While April 15 has been a known target date for USDA's launch of farmer sign-up for disaster assistance programs reestablished by the 2014 Farm Bill, USDA made this sign-up date official today. Beginning next week, eligible producers can sign up for the Livestock Indemnity Program (LIP) and the Livestock Forage Disaster Program (LFP), which will provide payments for those producers who suffered livestock deaths and grazing losses that have occurred since the expiration of the livestock disaster assistance programs in 2011, including calendar years 2012, 2013 and 2014. Enrollment also begins April 15 for producers with losses covered by the Emergency Assistance for Livestock, Honeybees and Farm-raised Fish Program (ELAP) and the Tree Assistance Program (TAP).

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