Evening Report (VIP) -- October 18, 2013

October 18, 2013 10:07 AM
 

INFORMA RAISES 2014 SOYBEAN PLANTED ACREAGE PROJECTION... Informa Economics reportedly expects record-large soybean planted acreage for 2014 of 83.9 million, which is up 300,000 acres from its previous outlook. This would be a 7 million bu. increase from the current crop-year. The high bean plantings are expected to come at the expense of corn acres. The firm reportedly lowered its corn planted acreage projection by 1 million acres to 91.7 million. This would be down 4.3 million bu. from 2013.

For wheat, Informa reportedly raised its 2014 plantings peg by 1 million bu. to 57.7 million acres. In 2013, wheat plantings totaled 59.3 million acres. The firm expects cotton plantings of 11.2 million acres, which is unchanged from its previous guess but up 881,000 acres from 2013.

 

FIRST LOOK AT 2014-15 BALANCE SHEETS... An early look at what could be ahead for 2014-15 isn't written in stone, but it provides an idea of where things could be headed as producers begin to make plans for 2014-15. Our first look at the upcoming marketing year suggests planted corn acres will be down from this year, but a recovery in harvested acres would bring production back above the current year and result in a rebuilding in carryover just below the 2-billion-bu. mark. But if planted corn acreage is down, we suspect soybean acreage will pick up some of the slack to result in around a 3.5-billion-bu. crop and carryover inching toward the 400-million-bu. level. Click here for full supply & demand projection tables.

 

UPDATE ON EXPORT SALES REPORT RELEASE SCHEDULE... USDA released the Export Sales Report for the week ended Sept. 26 this afternoon. Going forward, USDA will update the export sales data for the week ended Oct. 3 next Thursday at 7:30 a.m. CT. On Oct. 31 at 7:30 a.m. CT, USDA will update export sales data for the weeks ended Oct. 10, Oct. 17 and Oct. 24. Subsequent reports will be released as scheduled.

 

POTENTIAL CHANGES FOR FARM BILL VIA CONFERENCE... While the first official farm bill conference session will not take place until at least the week of Oct. 28, a lot of informal meetings are taking place. The initial push is on getting a "framework agreement" between House Ag Chairman Frank Lucas (R-Okla.) and Senate Ag Chairwoman Debbie Stabenow (D-Mich.). Lucas will chair the conference panel.

A potential framework accord would deal largely with Title 1 (farm program safety net programs). Stabenow, is reportedly pushing for an "all-in" approach to safety net programs, which would allow farmers to qualify for both revenue (shallow loss) and price loss (target price) protection. That is already the case in the Senate farm bill, but that measure has a lot lower target (reference) price levels than the House farm bill and thus is not seen as a "true choice" for farmers. The Senate approach offers 90% of funding for the revenue and only 10% for price loss, clearly favoring corn and soybean growers in the Midwest.

If a way can be found to balance those programs without impacting House target price levels too much, then the all-in concept could come into play. If not, then the House will push to save their more equitable farmer choice program. Even if an all-in approach is taken, farmers would be given the option to take the Supplemental Coverage Option (SCO) instead of the revenue loss coverage (called Ag Risk Coverage/shallow loss in the Senate farm bill).

Stabenow and her staff are also reportedly pushing for all payments to be made on base acres, but the House prefers planted up to base acres. She also wants a farm-calculated farmer safety net trigger option. While that is currently an option in the Senate farm bill, similar language is not in the House farm bill. Another Stabenow goal for which contacts say she would modify her prior safety net positions to get, is to get mandatory money spent for energy-related programs in the farm bill. That is in the Senate farm bill but not in the House version. The odds are declining for any supply management language in dairy and a conservation compliance linkage with crop insurance cannot be ruled out. Get more details.

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