Evening Report (VIP) -- January 16, 2014

January 16, 2014 08:40 AM

Drought expands marginally in central Corn Belt; well-entrenched across West... This morning's National Drought Monitor was one of the most interesting updates we've seen during the winter in quite some time. After holding steady due to frozen soils, drought across the Midwest expanded marginally, now covering 33.8% of the region.

Drought contracted marginally in the Central Plains, although 95.3% of Kansas is covered by some form of drought (unchanged from last week). Meanwhile, drought expanded across Oklahoma and Texas, as the monitor notes the core drought area of the region remains dry.

The monitor notes there is little or no drought relief is in the forecast from the Pacific Coast to the Plains. "A stronger-than-normal ridge of high pressure will span from the Canadian Rockies into the Southwest, maintaining dry, warmer-than-normal weather across much of the West. Temperatures will regularly top the 60-degree mark as far north as the Central High Plains, and will exceed 80°F in the Desert Southwest," it states. "Farther east, a modest surge of cool air into the eastern one-third of the U.S. will be followed by another round of below-normal temperatures across the Midwest and East toward week’s end. On Wednesday night and Thursday, a high-wind event can be expected across the Northern and Central Plains and the eastern Corn Belt, while blizzard conditions will affect the Red River Valley." Click here for related maps.


FSA prevent plant update shows mild rise in corn & bean acres... USDA's Farm Service Agency (FSA) recently released its final batch of crop acreage data for 2013 crops. The January update puts prevent plant for the 2013 corn crop at 3.617 million acres, which compares to 3.614 million acres in its December update. Soybean prevent plant acres in January were pegged at 1.704 million acres, which is up nearly 2,000 acres from the agency's last update. Total prevent plant acres for commodities came in at 8.318 million acres, which is up slightly from FSA's 8.313-million-acre peg last month. For more details, click here.


Likely crop subsidy provisions of new farm bill... As reported in "First Thing Today," agreement on dairy policy that has been a sticking point for the farm bill conference report appears near. Once this is settled, lingering issues will also be concluded. These include final decisions on country-of-origin labeling (COOL) and crop subsidy provisions. A producer's individual payment limit will likely be no lower than $105,000 -- the current limit for combined direct ($40,000) and counter-cyclical payments ($65,000). The unified adjusted gross income limit will likely be a three-year average limit of $950,000. For more updates on the farm bill, click here.


Grape nuts added to "GMO-free" cereal list... We certainly aren't going to "alert" you each time a major food product goes "GMO-free," but the latest to be added to the growing list is interesting: Post's Grape Nuts. The full list of ingredients includes: whole grain wheat flour, malted barley flour, isolated soy protein, salt, whole grain barley flour, malt extract and dried yeast. Yes, folks, that means Post will be sourcing GMO-free soy protein (far down its list of ingredients).

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