USFR Weekly Recap - February 24-25, 2018

February 24, 2018 03:30 AM
 
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TODAY ON U.S. FARM REPORT
FEBRUARY 24-25, 2018

HEADLINES

WELCOME TO U.S. FARM REPORT. I'M TYNE MORGAN,  THE SHOW MAY LOOK A LITTLE DIFFERENT THIS WEEK.  THAT'S BECAUSE WE'RE TRYING TO IMPROVE THE  PROGRAM TO MAKE IT BETTER FOR YOU THE VIEWER.  SO LET US KNOW WHAT YOU THINK, AS  HERE'S WHAT'S  IN STORE OVER THE NEXT 60 MINUTES AS MILK PRODUCTION SOARS, THE PRODUCT IS COMING  FROM FEWER FARMS.  AS CALIFORNIA TRIES TO THAW OUT, IT'S CASH CROPS  LIKE ALMONDS THAT WEREN'T SPARED FROM MOTHER  NATURE.  IT'S A TAX DILEMMA IN WASHINGTON AND IN FARM  COUNTRY. AND THE CONTROVERSY DEALS WITH  SECTION 199A.  <THAT'S THE PROBLEM. THEY OVERDID IT.> WHAT'S A POSSIBLE SOLUTION AND WHEN COULD THE  CHANGE MAKE IT THROUGH WASHINGTON? THAT'S OUR  FARM JOURNAL REPORT.  AND IN JOHN'S WORLD <FEEDING THE WORLD ISN'T WHAT IT USED TO BE>   U.S. FARM REPORT - BROUGHT TO YOU BY THE DEPENDABLE, LONG  LASTING, CHEVY SILVERADO.>

ACREAGE BATTLE
NOW FOR THE NEWS, IN THE BATTLE OF CORN VERSUS SOYBEANS, IT COULD  BE SOYBEAN ACRES THAT WIN OUT THIS YEAR. BUT  USDA'S EARLY PROJECTIONS CALL FOR A TIE.  DURNIG USDA'S AG OUTLOOK FORUM, CHIEF  ECONOMIST ROBERT JOHANNSEN  FORECASTING  EQUAL SOYBEAN AND CORN ACRES IN 2018... 90 MILLION  ACRES IN CORN AND 90 MILLION ACRS IN BEANS. LAST YEAR, FARMERS PLANTED 90 PPOINT 4 MILLION  ACRES OF CORN AND 90 POINT 2 MILLION OF SOYBEANS.  FOR THE FIRST TIME IN FOUR YEARS, WHEAT ACRES  ARE PROJECTED TO INCREASE, HITTING 46.5 MILLION.  ALL COTTON COULD SEE A BIG JUIMP, UP TO 13 POINT 3  MILLION. AND ALSO A FAVORABLE OUTLOOK FOR RICE  ACRES. USDA FORECASTING 2 POINT 9 MILLION ACRES  PLANTED IN RICE THIS YEAR.  USDA'S FORECAST COMES ON TEH HEELS OF  BLOOMBERG REPORITNG FOR THE FIRST TIME IN 35  YEARWS, SOYBEASN ACRES ARE POSITIONED TO  OVERTAKE CORN ACRES. THOSE FINDINGS BASED ON A BLOOMBERG SURVEY OF  21 TRADING FIRMS AND ANALYSTS. THOSE SRUVEYED PROJECT CORN PLANTINGS TO DROP  TO 90 POINT 12 MILLION ACRES AND SOY ACRES TO  JUMP TO 90 POINT 69 MILLION.  THAT COULD BE SUPPORTED BY A PRICE RUN FOR  SOYBEANS THIS WEEK, WITH THE SUMMER CONTRACTS  BREAKING THE 10.50 MARK. 

COLD STORAGE, MILK PRODUCTION
USDA THINKS BEEF PRODUCTION TO HIT A RECORD  HIGH IN 2018.  WITH BEEF PROJEDUCTION PROJECTED TO GROW  NEARLY 6 PERCENT.  PORK COULD SEE A 5 PERCENT JUMP. AND BROILERS ARE FORECAST TO INCREASE 2 POINT 3  PERCENT.  MILK PRODUCTION IS ALSO EXPECTED TO TICK HIGHER,  WITH THE FORECAST FOR MILK PRICES TO DROP 9  PERCENT. THE LATEST COLD STORAGE REPORT HSOWING A  LARGE SPIKE IN PORK BELLY STOCKS THIS MONTH. THE AMOUNT OF BACON IN FREEZERS JUMPED 219  PERCENT FROM LAST YEAR. BUT STILL SKY OF THE  RECORD HIGH PRODUCERS SAW IN 1989. AND 13 PERCENT FROM ALST MONTH.  TOTAL RED MEAT IN FREEZERS ALSO TICKED HIGHER,  UP NEARLY 10 PERCENT.  2017 WAS A RECORD YEAR FOR MILK PRODUCTION, BUT  IT WAS DONE SO ON FEWER FARMS WITH LESS COWS.  TOTAL MILK GENERATED GREW TO 215 BILLION POUNDS.  THAT'S A 1 POINT 4 PERCEN TINCREASE FROM 2016.  BUT USDA SAYS THE NUMBER OF LICENSED DAIRY  FARMS DROPPED BY 1600 FARMS TO 40 THIOUSAND 219. THAT'S A 3 POINT 8 PERCENT DROP.

NUMBER OF FARMS SHRINKING
THE NUMBER OF FARMS IN THE U-S IS DWINDING.  A NEW REPORT FROM USDA SHOWS THERE WERE 12  THOUSAND FEWER FARMS IN 2017 THAN IN 2016. AND  TOTAL LAND IN FARMS FELL BY 1 MILLION ACRES. THE AVERAGE FARM SIZE INCRESED 2 ACRES FROM  2016 TO 444 ACRES.  THE REPORT ALSO SHOWS 80 PERCENT OF ALL FARMS  HAD LESST HAN 100 THOUSAND DOLLARS IN SALES,  WITH ONLY 8 PERCENT OF FARMS SHOWING SALES OF  500 THOUSAND DOLLARS OR MORE.

SEPARATE IMMIGRATION PLAN FOR AG
AG SECRETARY SONNY PERDUE WANTS TO CARVE OUT  A SEPERATE IMMIGRATION PROGRAM FOR  AGRICULTURAL WORKERS. DURING THE AG OUTLOOK FORUM, PERDUE SAID  IMMIGRANTS COMIGNTO THE U-S TO WORK ON FARMS  AND RANCHERS AREN'T TAKING JOBS FROM  AMERICANS. AND THEY AREN'T THE ONES PUTTING A  BURDEN ON THE JUSTICE OR WELFARE SYSTEMS.  HE SAID  AG IS CAUGHT IN THE CROSSFIRE OF THE  IMMIGRATION DEBATE.

U.S.-CHINA TRADE RELATIONS
USDA SAID THIS WEEK THAT FREE TRADE AGREEMENTS  ARE BECOMING INCREASINGLY IMPORTANT.  BUT CHINA IS HTE BIGGEST BUYER. 21 POINT 6 BILLION  DOLLARS WORTH OF EXPORTS EXPECTED TO CHINA.  BUT FRESH FEARS THAT THE RELATIONSHIP BETWEEN U- S ADN CHINA COULD FADE AS  THE COMMERCE  DEPARTMENT LAYING OUT SEVERAL OPTIONS FOR PRESIDENT DONALD TRUMP TO CONSIDER, INCLUDING A  TARIFF OF  NEARLY 24% ON STEEL IMPORTS FROM ALL  COUNTRIES. CHINA WARNS IT MIGHT RETALIATE IF U.S. IMPOSES  METALS TARIFFS THE PRESIDENT HAS UNTIL APRIL 11 TO DECIDE ON ANY  ACTION ON STEEL AND APRIL 19 FOR ALUMINUM.  USDA SAID JUST THIS WEEK THAT CHINA ACCOUNTS  FOR 65 PERCENT OF SOYBEAN EXPORT BUSINESSL AND  THAT NUMBER COULD GROW TO 75 PRCENT IN 10  YEARS.

CAN TPP BE REVIVED?
A GROUP OF U-S SENATORS ARE HOPING THE SHIP  HASN'T SAILED ON THE U-S REJOINING THE TRANS  PACIFIC PARNTNERSHIP.  TWENTY-FIVE REPUBLICAN SENATORS SENT A LETTER  TO THE PRESIDENT HTIS WEEK, PUSHING THE  ADMINSTRATION TO RECONSIDER AND REJOIN THE T-P- P.  THE PRESIDENT PULLED OUT OF THE TRADE PACT  SHORTLY AFTER JOINING US. AND NOW SOME IN AG SAYS REJOINING WON'T BE THAT  EASY.  <"IT'S ALSO A MATTER OF BANDWITH. ALL OF THE PEOPLE WHO ARE ON  BOARD RIGHT NOW ARE DOING EVERYTHING THEY CAN TO FINISH THE  NEGOTIATIONS ON NAFTA AND KORUS. THERE'S NOT A WHOLE LOT OF  PEOPLE SITTING AROUND LOOKING AT THINGS TO DO. I DON'T BELIEVE  GETTING BACK TO TPP IS SOMETHING WE'RE GOING TO SEE IN 2018."> THE TRANSPACIFIC PARTNERSHIP WITH THE 11  REMAINING COUNTRIES ISN'T QUITE A DONE DEAL CANADIAN TRADE LEADERS THEY AREN'T PLANNING TO  RATIFY TPP UNTIL FALL. 

CALIFORNIA ALMOND CROP
FROM FLOODS TO A MAJOR FREEZE, PLUNGING  TEMPERATURES IN CALIFORNIA PUT  GROWERS ON  HIGH ALERT HTIS WEEK.  THE HARD FREEZE HIT HTE SACREMENTO AND SAN  JOAQUIN VALLEYS SEVERAL NIGHTS IN A ROW.  ALMOND PRODUCERS DOING ALL THEY COULD TO SAVE  THE CROP.  GROWERS LIKE DON CAMERON HAD A STREAM OF  RUNNING WATER TO SPARE WHAT HE COULD.  CROP  TUEDAY MORNING.   IRRIGATING ORCHARDS WITH WATER HELP THE CROPS  MODERATE TEMPERATURES.  RABOBANK TELLING FARM JOURNAL THAT WHILE HTE  EXTENT OF THE DAMAGE IS STILL LARELY UKNOWN,  THEY DO EXPECT SIGNIFICANT FREEZE DAMAGE INT EH  SACRAMENTO VALLEY. 

RECORD-SETTING ANGUS BULL
HOW MUCH WOULD YOU PAY FOR A PRIZED ANGUS  BULL? THIS ONE SOLD FOR 800 THOUSAND DOLLARS AT  AUCTION LAST WEEK, AND THE NEW OWNERS THINK  THEY GOT A STEAL. ACCORDING TO OUR REPORTING PARTNERS AT  DROVES, HIS NAME IS SAV ELATION 78-99. IT'S NOT FOR SHOW  EITHER... THE BULL WAS PURCHASED FOR IT'S  GENETICS, WHICH PRODUCES A RARE COMBINATION OF  LOW BIRTH WEIGHT, HIGH GROWTH AN EXCELLENT  BEEF QUALITY.  THE BULL WAS PURCHASED BY SQUARE B RANCH AND  CATTLE COMAPNY OF WARSAW, MO AND BOGLE RANCH  LLC OF LANGLEY OKLAHOMA. 

TEASE
THAT'S IT FOR THE NEWS. WHEN WE COME BACK,  METEOROGLIST MIKE HOFFMAN HAS A PEAK AT WHAT  COULD BE IN STORE FOR SPRING PLANTING.  PLUS, THE RECENT RUNUP IN SOYBEAN PRICES WAS  THE STORY AGAIN THIS WEEK. BUT IS THE RIDE HIGHER  RUNNING OUT OF STEAM? OUR MARKETING DISCUSSION  IS STILL AHEAD. 

WEATHER
MIKE HOFFMAN JOINS US THIS WEEK. MIKE, WE'RE  COMBINING BOTH YOUR SHORT-TERM AND LONG-TERM  WEATHER INTO ONE MOVING FORWARD... AND THE  HOPE IS TO GIVE YOU MORE TIME EACH WEEK. YOU HAVE  TO BE HAPPY ABOUT THAT THANKS. NO I OBVIOUSLY HAVE NO PROBLEM TALKING AS LONG AS YOU WANT ABOUT THE WEATHER. IN FACT PRODUCERS WILL TELL YOU THAT I USUALLY TRY TO GO TOO LONG SO WE'LL TRY AND KEEP IT WITHIN THE TIMEFRAME HERE. DROUGHT MONITOR SHOWING THINGS GETTING WORSE FROM WEST TEXAS WESTERN OKLAHOMA INTO THE FOUR CORNERS REGION. IT HAS GOTTEN BETTER THOUGH IN MUCH OF THE SOUTHERN MISSISSIPPI VALLEY AND I THINK IT'S STILL GOING TO IMPROVE SOME MORE IN THAT AREA RIGHT THERE ARKANSAS MISSOURI AREAS THAT HAVE HAD SOME RAIN WASN'T COUNTED IN THIS DROUGHT MONITOR. BUT IF WE GO BACK FOUR WEEKS YOU CAN SEE OVER THE PAST MONTH THE CHANGE HAS BEEN SLOWLY HAPPENING IN THE SOUTHEAST ANYWAY AS THINGS HAVE GOTTEN A LITTLE LESS RED AND A LITTLE LESS ORANGE BECAUSE OF THE RAINFALL THAT YOU'VE BEEN HAVING BUT UNFORTUNATELY THE AREAS THAT HAVE REALLY NEEDED IT DESPERATELY AREN'T GETTING IT. THAT'S THE FAR WESTERN SOUTHWESTERN PLAINS BACK INTO THE FOUR CORNERS REGION. NOW TAKING A LOOK AT THE OVERALL WEATHER PATTERN THAT WE HAVE A CHANGE IS PROBABLY GOING TO HAPPEN AS WE HEAD THROUGH THIS COMING WEEK. YOU CAN SEE WE'VE HAD THESE TROUGHS DIGGING INTO THE WEST FOR A WHILE NOW. IT COULD COME UP AS A VERY WET STORM SYSTEMS INTO THE OHIO VALLEY AND THE GREAT LAKES AS WE HEAD THROUGH THE MIDDLE OF THIS WEEK IT LOOKS LIKE A PERIOD OF VERY DRY WEATHER WITH THE RIDGE POPPING ITS WAY ON UP INTO THE GREAT LAKES IT'S BEEN OVER THE SOUTHEAST MOST OF THE TIME. YOU CAN THEN SEE THE TROUGH DIGGING INTO THE WEST AND YET ANOTHER PIECE DIGS INTO THE WEST.

BUT OUR MODEL IS KIND OF SQUEEZING THINGS TOGETHER HERE AND BRINGING IN A TROUGH INTO THE EASTERN PORTIONS OF THE COUNTRY BY THE END OF THE WEEK AND THAT'S GOING TO CATTLE LINGER DOWN THE EAST COAST SO THAT COULD TURN CHILLY ALL THE WAY DOWN INTO FLORIDA. IT LOOKS LIKE AS WE HEAD INTO NEXT WEEKEND HOW LONG THAT LAST IS KIND OF TOUGH TO TELL IF YOU HAVE A BIG TROUGH IN THE WEST. MANY TIMES YOU'LL SEE THAT WARM RIDGE COME BACK TO THE EAST BUT WE'LL HAVE TO WAIT AND SEE ON THAT. THAT'S STILL A WEEK AWAY. LET'S GO DAY BY DAY THEN THIS WEEK ON MONDAY STORM SYSTEM MOVING THROUGH THE SOUTHEAST WITH SOME SHOWERS AND EVEN THUNDERSTORMS THERE. PRETTY COLD CONDITIONS STILL NORTH OF THE GREAT LAKES. MILD THOUGH RIGHT THROUGH THE CENTER OF THE COUNTRY WITH LOTS OF SUNSHINE. COUPLE OF STORM SYSTEMS OUT WEST. THIS IS A VERY WEAK ONE IN SOUTHERN CANADA BUT THE ONE IN THE WEST IS DIVING SOUTHWARD JUST LIKE ALL THE REST HAVE LOTS OF SNOW WITH THAT WIND ALL THE WAY TO THE COAST. YOU'LL JUST SEE RAIN BUT INLAND A LOT OF THAT'S GOING TO BE SNOW. AND YOU CAN SEE ON WEDNESDAY THE FIRST SYSTEM MOVING THROUGH THE SOUTHEAST WITH SHOWERS AND THUNDERSHOWERS THERE KIND OF A SECONDARY SYSTEM COMING THROUGH THE FOUR CORNERS REGION. ANOTHER STORM DIVING DOWN THE WEST COAST AND THEN WE SEE THAT BIG STORM INTO THE NORTHEAST WITH SNOW ON FRIDAY. COLD FRONT INTO FLORIDA. NEXT SYSTEM DIVING THROUGH THE WESTERN STATES MARCH TEMPERATURES BELOW NORMAL FROM ARKANSAS NORTHWARD ABOVE NORMAL FOR FLORIDA. AND ALONG THE RIO GRANDE INTO THE SOUTHWEST WILL BRING THE ABOVE NORMAL LITTLE FARTHER NORTH ON APRIL STILL BELOW NORMAL THOUGH GREAT LAKES IN THE NORTHERN PLAINS BELOW NORMAL GREAT LAKES FROM THE NORTHWEST BY MAY BUT A LOT OF THE COUNTRY TURNING WARMER AT THAT POINT PRECIPITATION OVER THE NEXT 90 DAYS. TENNESSEE OHIO VALLEY NORTHEAST GREAT LAKES ABOVE NORMAL. SAME THING NORTHWEST AND ENDING SEE THE WESTERN PLAINS INTO THE SOUTHWEST BELOW NORMAL.

THANKS, MIKE.

TEASE
JUT THIS WEEK, USDA GAVE US AN EARLY LOOK AT PLANTING PROJECTIONS. BUT HOW MUCH STOCK CAN WE PUT INTO THOSE RIGHT NOW? PAUL GEORGY AND SHAWN HAXKETT JOIN US AFTER THE BREAK.

ROUNDTABLE 1
WELL WELCOME BACK TO U.S. FARM REPORT A NEW FORMAT OF THE PROGRAM THIS WEEK. SO WHY NOT HAVE A COUPLE NEW ANALYSTS ON THE PROGRAM WHO HAVE BEEN IN THE BUSINESS FOR A WHILE. SHAWN HACKETT AS WELL AS PAUL GEORGY THANK YOU SO MUCH FOR JOINING US. GOOD TO BE HERE. JUMPING RIGHT IN. WHAT MADE HEADLINES THIS WEEK THIS USDA AG OUTLOOK FORUM. I MEAN EVERY YEAR WE HAVE THIS FORM EVERY YEAR THEY GIVE A HINT AT ACREAGE. THIS YEAR THOUGH SEAN 1990 IS WHAT THEY'RE CALLING FOR CORN AND SOY. HOW MUCH USUALLY DOES THAT CHANGE FROM NOW UNTIL WE GET THAT PROSPECTIVE PLANTING REPORT. AND IT CHANGES QUITE A BIT BECAUSE IF THEY DO MORE OF A STATISTICAL ANALYSIS AND THE FARM AND DON'T REALLY MAKE MUCH OF AN ANALYSIS EXACTLY ON CENTRAL WEATHER CONDITIONS AND NECESSARILY PRICE THEY LOOK AT ROTATION AND KIND OF A MORE OF A HOLISTIC APPROACH SO RARELY IS THAT NUMBER TO BE RELIED UPON VERBATIM. WE WILL USE IT AS A STARTING POINT AND THEN WE GO FROM THERE BASED UPON HOW THINGS PLAY OUT AS WE MOVE INTO MARCH AND APRIL. SO WHEN WE LOOK AT THIS ACREAGE DEBATE AND WHAT COULD HAPPEN BETWEEN NOW AND THE END OF MARCH I MEAN THERE'S ALL THIS TALK THAT SOYBEANS ARE GOING TO OUTPACE CORN. RIGHT. AND BLOOMBERG CAME OUT WITH AN ARTICLE AND THAT'S WHAT THEIR SURVEY CALLED FOR. DO YOU THINK WE WILL SEE THAT BIG OF A JUMP IN SOYBEAN ACRES THIS YEAR. DOES THE RESEARCH AT ALLENDALE HAS DONE SO FAR WE DON'T THINK THERE'LL BE A BIG JUMP. I MEAN THERE'S GOING TO BE AN INCREASE MAYBE FIVE HUNDRED THOUSAND ACRES OR SO MAYBE A DECREASE TO 300000 ACRES OF CORN BUT ALLENDALE HAS GOT THEIR SURVEY, ACTUALLY WE'VE DONE AN ACREAGE PLANTED ACREAGE SURVEY FOR ALMOST 30 YEARS NOW AND WE START THAT NEXT WEEK AND SO WE'LL HAVE A BETTER IDEA WHAT FARMERS ARE TELLING US. BUT WHEN YOU LOOK AT THE THE ECONOMICS OF IT THE ADVANTAGE GOES TO SOYBEANS RIGHT NOW THE FARMERS ARE LOOKING AT THE AMOUNT OF DOLLARS HE'S PUTTING IN ON AN ACRE PER ACRE BASIS. AND THEN THE YIELD OF SOYBEANS IN THE LAST FEW YEARS HAS BEEN ENOUGH THAT ENOUGH VARIATION THAT SAYS IF YOU GET 10 BUSHEL MAKER MORE 15 BUSHEL OR MORE. I GOT A LOT MORE DOLLARS RETURN WITH A LOT LESS INVESTED. SO I THINK THE SOYBEAN ECONOMICS IS GOING TO WEIGH ON PLANTING BUT THEN WE GET INTO MAY AND YOU KNOW WHAT HAPPENS THEN IF THE WEATHER IS GOOD AND THE PLANNERS ARE RUNNING WE'LL JUST PLANT A FEW MORE ACRES OF CORN SO WE WON'T REALLY KNOW TILL JUNE. BUT I THINK THE NUMBERS WILL BE TELL-TALE HERE. WELL WHAT'S THE PROSPECTS OF SOYBEAN PRICES. I MEAN WE'VE SEEN A COUPLE OF REALLY GOOD WEEKS BUT IT KIND OF SEEMS LIKE THIS MARKET IS RUNNING OUT OF STEAM. WHAT IS YOUR OUTLOOK FOR PRICES MOVING FORWARD. WELL IT MEANS IT'S A PURE WEATHER MARKET ESPECIALLY FOR BEAN YIELD BECAUSE ARGENTINA IS SUCH A DOMINANT EXPORTER OF V.M. AND THEY EXPORT MORE BEING MEAL THAN THE U.S. AND BRAZIL COMBINED FOR EXAMPLE. SO WHEN WE LOOK AT THE POTENTIAL OF WHAT COULD THE CROP BE DOWN. HISTORICALLY IT'S BEEN DOWN ABOUT 5 TO 10 PERCENT AND WE'VE HAD SIMILAR SIMILAR CONDITIONS AND IF BRAZIL'S PRODUCTION IS LET'S SAY SIMILAR LAST YEAR WE THINK THE MARKET IS PRETTY MUCH RUN OUT OF GAS TO THE UPSIDE. BUT IT PROBABLY WILL WANT TO MAINTAIN SOMEWHAT OF A HIGHER LEVEL TO MAKE SURE IT GETS THOSE EXTRA ACRES IN THE GROUND IT DOESN'T WANT TO TAKE A CHANCE THAT IT DOESN'T HAVE A BAD CROP AND THEN DEMAND CONTINUES TO SURGE SO. SO WE'VE BEEN SAYING THAT WE THINK WE'RE TOPPING OUT BUT WE DON'T EXPECT AN IMMINENT CRASH. AND GIVEN THAT WE DO THINK THAT THE CROP AND PARE DOWN THERE. WELL YOU MENTIONED DEMAND FOR SOYBEANS BUT WHEN WE LOOK AT DEMAND FOR CORN YOU KNOW THAT'S REALLY WHAT WE'VE BEEN TALKING ABOUT AND IT SEEMS LIKE THERE IS KIND OF A BULLISH STORY BREWING FOR CORN RIGHT NOW CORN DEMAND HAS BEEN OUTSTANDING.

WE'VE HAD THE LAST SEVEN WEEKS OF CORN SALES WEEKLY SALES REPORTED BY USDA HAS BEEN ABOVE ANY OTHER TIME PERIOD AT THIS TIME PERIOD IN HISTORY SO WE'RE LOOKING AT RECORD SALES. WE'VE GOT CORN DEMAND FROM MEXICO AND THINGS LIKE IN OTHER COUNTRIES THAT YOU KNOW MAYBE A TRADE AGREEMENT MIGHT BE IMPACTING MIGHT BE WHY THEY'RE BUYING A LITTLE BIT EARLIER THAN THE NORMAL BUT I THINK CORN DEMAND IS GOOD BUT THE BOTTOM LINE IS EVEN WITH THE CORN DEMAND THAT WE HAVE WE STILL ARE LOOKING AT ENDING STOCKS OF TWO POINT FOUR BILLION BUSHELS. AND EVEN WITH 90 MILLION ACRES NEXT YEAR AND 174 ACRE YIELD WE GOT PLENTY OF CORN TO GO AROUND. YEAH AND I WANT TO GET YOUR THOUGHTS ON CORN PRICES WE NEED TO TAKE A BREAK. WE WILL DO THAT IN THE SECOND HALF HOUR OF THE PROGRAM WE'LL LOOK AT CORN WHEAT CATTLE. WE'LL DO THAT ALL STILL COMING UP ON US FARM REPORT.

JOHN’S WORLD
IN AGRICULTURE, FARMERS ADN RANCHERS PRIDE  THEMSELVES ON FEEDING HTE WORLD AND THAT'S THE  TOPIC OF THIS WEEK'S JOHN'S WORLD. LET'S HEAD NOW  TO THE FARM. ONE OF THE MOST FAMILIAR CALLS TO ACTION FOR FARMERS IS THE NEED TO  FEED AND EVER GROWING WORLD POPULATION. WHILE IT'S TRUE GLOBAL  POPULATION IS INCREASING, IT IS DOING SO EVER MORE SLOWLY, AND IT IS  NOT GOING UP FOR THE OBVIOUS REASON. WHEN WE THINK ABOUT MORE  PEOPLE IN THE WORLD WE HAVE USUALLY FOCUSED ON BIRTHS AND  FERTILITY RATES. IN THE PAST FEW YEARS, MUCH BETTER DATA AND  DEMOGRAPHIC ANALYSIS HAS UNCOVERED A SOME SURPRISING TRENDS. FIRST, AS INCOMES RISE, FERTILITY - THE NUMBER OF CHILDREN PER  WOMAN DROPS. THIS IS TRUE FOR ALL CULTURES AND NATIONS. SECOND, AS EDUCATION INCREASES, FERTILITY RATES DROP. THIS WAS  HARD TO TEASE OUT FROM THE NUMBERS, BUT SEEMS TO BE A SOLID RULE  FOR GENERATING POPULATION PROJECTIONS. THIRD, AS A RESULT OF BOTH OF THE THESE TRENDS, WE ARE CLOSE TO  "PEAK CHILD". IN OTHER WORDS, WE HAVE JUST ABOUT AS MANY  CHILDREN UNDER 5 OR UNDER 15 AS WE'RE GOING TO HAVE FOR THE REST  OF THE CENTURY. NOTED DEMOGRAPHER HANS ROSLING FIRST  DISCOVERED THIS CURIOUS PHENOMENON AND HIS EARLY PROJECTIONS OF  A PEAK AT 2 BILLION CHILDREN UNDER 15 ARE HOLDING UP WELL. FINALLY, IF WE HAVING FEWER CHILDREN THAN BEFORE, WHY DOES  POPULATION STILL INCREASE? SIMPLY PUT, PEOPLE AREN'T DYING AS  EARLY AND OFTEN. LONGER LIFE EXPECTANCY ALMOST COMPLETELY  ACCOUNTS FOR POPULATION GROWTH. I WILL NOTE HERE THAT ONE  ALARMING DIVERGENCE FROM THIS GLOBAL TREND IS THE US, WHERE LIFE  EXPECTANCY HAS DROPPED FOR TWO SUCCESSIVE YEARS, AND REMAINS  WELL BELOW OTHER RICH COUNTRIES.  THE TAKEAWAY FOR ME IS WHILE WE CAN QUIBBLE ABOUT A PEAK  POPULATION OF 10 OR 11 BILLION, IT WILL BE DETERMINED FAR MORE BY  LIFE-EXPECTANCY THAN FERTILITY. FOR FARMERS THEN, WE NEED TO  TEMPER OUR ENTHUSIASM FOR THIS GROWING MARKET WITH THE REALITY  THAT IT WILL BE AN AGING MARKET AS WELL. EXPECTATIONS OF SOARING  COMMODITY NEEDS SHOULD BE MODERATED BY FACTORING IN THE  DIFFERENCE BETWEEN A 20 YEAR-OLD APPETITE AND A 65 YEAR-OLD  APPETITE.

TEASE
THANKS, JOHN. DEFINITELY SOME FOOD FOR THOUGHT.  UP NEXT, TRACTOR TALES WITH MACHINERY PETE. AND  THIS WEEK, IT'S A ALLIS CHALMERS IN THE SPOTLIGHT. 

TRACTOR TALES
WELCOME BACK TO TRACTOR TALES FOLKS. AND THIS WEEK A REAL TREAT  FOR YOU. WE'RE HEADING TO PLAINVIEW MINNESOTA SOUTHEAST PART OF  THE STATE TO VISIT MY FRIEND STEVE FLEECE AND CHECK OUT HIS  CLASSIC ALICE CHALMER STEVE FLEECE HAS A BEAUTY TO SHARE WITH  US. THIS D 21 ALICE CHALMER SUPERCHARGED DIESEL CAME WITH A  FEW EXTRAS. WE'VE GOT D 21 HERE A 1965 MODEL. THEY CAME OUT AFTER THE D  19. AND I DON'T KNOW A MORE DRASTIC CHANGE FROM GOING TO A D  19 TO THIS BIG THE 21 HAD A 426 CUBIC INCH ENGINE IN IT. I WAS  LOOKING FOR SOMETHING 70 WHEATLAND OLIVER SO I FOUND ONE DOWN  BY IOWA GUY NAME OF THE DEAN ERIKSSON HAD ONE. SO MY BROTHER  JOHN LIVES IN DES MOINES SO I SAID JOHN RUN OVER AND LOOK AT  THIS TRACTOR FOR ME. SO HE WENT OVER AND LOOKED AND THE OLD GUY  THREW THE SHED OPEN AND HE HAD 15 TRACTORS THERE. JOHN SAYS  YOU BETTER GET DOWN HERE SO MY BROTHER JOHN AND BILL AND  MYSELF WENT DOWN AND HE WANTED TO SELL THEM ALL. SO WE ENDED  UP BUYING THEM ALL. WAS JUST QUITE A FIND FOR US YOU KNOW. WE  WERE JUST GETTING IN THE COLLECTING AND THAT WAS OUR BIG PURCHASE  FOR US. I MEAN THAT MANY TRACTORS IN ONE SHED.   WE'RE GLAD WE FOUND THEM. THIS IS JUST THE WAY WE BOUGHT THIS  ONE AND IT'S BEEN A GOOD RUN AND WE TOOK ON A COUPLE RIDES AND  IT HASN'T WON FIRST PLACE HAS COME IN THIRD OR FOURTH. WE HAVE  TRACTOR RIDES LIKE WE WENT TO THE FLEECE TRACTOR RIDE EVERY SUMMER  WE GO OVERNIGHT. THIS YEAR WE WENT TO RACINE MINNESOTA AND  WE STOPPED FOR BREAKFAST AND WE STOPPED AT ANOTHER PLACE FOR A  LITTLE SNACK AND THEN WE GO THERE AND WATCH THE TRACTOR PULL THEN  WE GO TO THE HOTEL STAY OVERNIGHT. ALL 10 BROTHERS GO AND WE  HAVE OTHER FRIENDS WHO WANT TO GO AND. THEN WE COME BACK THE  NEXT DAY. I GUESS THAT'S ABOUT IT ON THAT ONE. JUST. JUST BEGUN  BEAUTIFUL. THANKS SO MUCH. 

TEASE
STILL TO COME, THE NEW TAX LAW IS A MIXED BAG FOR  AGRICULTURE. BUT SECTION 199A IS SPARKING QUITE  THE CONTROVERSY ON FARMS AND IN WASHINGTON.  BUT WHAT'S THE LIKELIHOOD SECTION 199A WILL  CHANGE? WE'LL BREAK IT ALL DOWN AFTER THE BREAK

FARM JOURNAL REPORT
WELCOME BACK TO U-S FARM REPORT. TIMELY. TRUSTED. TRADITION. WELCOME BACK.  THE NEW TAX CODE IS STILL BEING ASSESSED, WITH  MANY CALLING IT A MIXED BAG FOR AGRICULTRE.  SECTION 199A IS AN AREA THAT SOME PRODUCERS  WANT TO SEE CHANGED, WHILE OTHERS WANT IT LEFT  UNTOUCHED.  BUT  IT'S A FIX THAT  IOWA SENATOR CHUCK GRASSLEY  SAYS LEGISLATORS REACHED THIS WEEK. HOERBRT  SOURCES CLOSE TO THE MATTER SAY THAT'S SIMPLY  NOT TRUE.  AND IT'S THAT TAX DILEMMA THAT'S THIS WEEK'S FARM  JOURNAL REPORT.  <IT'S THE LARGEST TAX CUT IN THE HISTORY OF OUR COUNTRY. AND IT'S NOT  JUST TAX REFORM, BUT TAX CUT> THE TRUMP ADMINISTRATION PASSING A SWEEPING TAX  OVERHAUL PLAN... A PLAN THAT G-O-P RALLIED  AROUND.  <WE COME TO THESE JOBS TO TRY AND IMPROVE THE LIVES OF THE  PEOPLE WE REPRESENT. AND THIS BILL, MORE THAN SO MANY OTHER  THIGNS WE'VE EVER TRIED TO DO, DOES THAT> TWO MONTHS LATER, FARMERS AND RANCHERS ARE  STILL WEIGHING THE PROS AND CONS OF THE NEW TAX  LAW.  <MORE THAN 40 PERCENT OF PRODUCERS TOLD US THEY THOUGHT IT  WOULD BE BENEFICIAL> PRODUCERS' EXPECTATIONS FOR LOWER TAXES  HELPED BOOST JANUARY'S PURDUE AG ECONOMY BAROMETER TO 135.. AN 8 POINT JUMP. THE BAROMETER ALSO FOUND 35 PERCENT OF THOSE  SURVEYED VIEW THE TAX CHANGES AS NEUTRAL.  <THIS SEEMS TO BE A GROUP WHO AREN'T QUITE SUREHOW THIS IS GOING  TO PAN OUT FOR THEIR FARM'S OPERATION > FARM CPA PAUL NEIFFER GRADING THE OVERALL TAX  CODE, VIEWING IT AS MOSTLY POSITIVE.  <FOR AGRICULTURE ASSUMING SECTION 199A GETS CHANGED TO WHAT  WE THINK IT MIGHT END UP BEING, I WOULD GIVE IT A B > IT'S SECTION 199A CREATING UNCERTAINY. THE NEW  TAX PROVISION GIVES  A 20 PERCENT TAX DEDUCTION  TO A FARMER SELLING GOODS TO A COOPERATIVE  RATHER THAN A PRIVATE ELEVATOR...  A LINE ITEM  THAT WAS ADDED LAST MINUTE.  <"AND BECAUSE OF THAT, IT REALLY WASN'T VETTED AS WELL AS IT MAYBE  SHOULD HAVE BEEN AT TH END OF THE TAX BILL> AND NOW SECTION 199A IS CREATING CONTROVERSY.  <THAT'S THE PROBLEM. THEY OVERDID IT.> PRIVATE GRAIN BUYERS ARE UPSET, SAYING  SECTION  199A PUTS THEM AT A DISADVANTAGE, AS NOW MORE  FARMERS ARE SELLING GOODS TO COOPS.  <SO BECAUSE OF THAT, YOU KNOW THE PRIVATES GOT TO GEGOTHER WITH  THE SENATORS WHO'VE CRAFTED IT AND SAID WE NEED TO SORT OF GET  THIS FIXED> SENATORS JOHN THUNE AND SENATORS JOHN HOEVEN  AUTHORING THE LAST MINUTE OF SECTION 199A ADD  ON.  NEIFFER SAYS IT WAS TO CATER TO TWO MAIN  SECTORS OF AGRICULTURE.  <IT WAS DESIGNED TO SORT OF KEEP THE DAIRY FARMERS AND THE  SUGARBEET FARMERS ON THE FOOTING THAT THEY WERE AT BEFORE.  THOSE LARGE PROCESSING TYPE COOPERATIVES WERE ABLE TO PASS  THROUGH A GOOD SIZE DEDUCTION TO THEM> EVEN SOME DAIRY FARMERS AREN'T HAPPY WITH  SECTION 199A, AS THE DEDUCTION CAN'T OFFSET  AGAINST CAPITAL GAINS. .. AND IT'S CAPITAL GAINS  FROM SELLING ASSETS LIKE BREEDING STOCK,  THAT  GENERATES INCOME FOR MANY DAIIRES.  NEIFFER SAYS SECTION 199A IS A PRIME EXAMPLE OF  THE LAW OF UNINTENDED CONSEQUENCES, WITH THE  SENATORS NOT REALIZING IT WOULD PROVIDE SUCH A  LARGE TAX DEDUCTION FOR CROP FARMERS.  <THERE SHOULDN'T BE UNINTENDED CONSEQUENCES. IN THE THEORY OF  TAX POLICY, THEY OVERDID IT. SO NOW THEY'RE TRYING TO FIND OUT THE  RIGHT MIDDLE GROUND. AND THE PROBLAM IS BECAUSE THE LONGER IT  STAYS THAT WAY, MORE AND MORE OF HTE AG COOP MEMBERS ARE  PENCING OUT THEIR TAXES AND FIGURING OUT WOW, DON'T GIVE IT UP> IT'S THOSE FARMERS WHO DON'T WANT TO SEE  SECTION 199A CHANGE.  <THE FARMERS WHO ARE MEMBERS OF COOPS LIKE THE LANGUAGE  NOW> NOW PRIVATE COMPANIES LIKE ETHANOL PRODUCER  GREAT PLAINS RENEWABLE ENERGY, ARE  RESTRUCTURE THEIR BUSINESS IN ORDER TO BECOME  A COOP, OVER FEARS THEY MAY NOT BE ABLE TO  SOURCE ENOUGH GRAIN IF SECTION 199A ISN'T FIXED.  BUT IT'S A FIX THAT BOTH HOEVEN AND THUNE ARE TRYING TO FIND. THE BIGGER  CHALLENGE, HOWEVER,  MAY BE GETTING THE NEW LEGISLATION PASSED.  <THE MOST LIKELY VEHICLE IS THE FUNDING BILL BY MARCH 23. THAT'S  ALMOST MAYBE THE LAST BILL LEAVING THE RAILROAD OTHER THAN THE  FARM BIL MAYBE LATER THIS YEAR. AND THAT'S WHY THEY BETTER GET IT  RIGHT> WEISEMEYER SAYS THE PRESSURE TO FIND A FIX  IS  OVERWHELMING FROM MAJOR LOBBYISTS FROM  COMPANIES LIKE CARGILL AND ADM. BUT NOW IT'S A  BALANCING ACT TO MAKE SURE IT DOESN'T DO MORE  HARM THAN GOOD.  <DON'T MAKE IT DETRIMENTAL TO AG COOPS. THAT'S CALLED A DILEMMA.  NEIFFER THINKS THE NEWLY WRITTEN SECTION 199A  WILL REVERT BACK TO SIMILAR LANGUAGE THAT WAS IN  THE ORIGINAL SECTION 199 < NOW CONVERSELY THE ONE THING I SHOULD STRESS TO FARMERS ON  199 WHETHER IT'S DEALING WITH A COOPERATIVE OR NOT THIS DOES NOT  CHANGE YOUR SELF EMPLOYMENT TAX AND THIS IS NOT DEDUCTIBLE FOR  STATE INCOME TAX PURPOSES  SO YOU HAVE TO BE CAREFUL ON THAT. >  IF CHANGES ARE ON THE HORIZON, THERE'S ALSO  QUESTION SURROUNDING WHETHER IT WILL BE MADE  RETROACTIVE TO THE FIRST OF THE YEAR.  <MOST OF THE TAX ANALYTS I'VE TALKED WITH THINK IT WILL BE MADE  RETROACTIVE TO JANUARY 1> HOWEVER, MAKING IT RETROACTIVE MAY OPEN THE  DOOR FOR LEGAL BATTLES, SINCE FAMRERS HAVE  ALREADY TAKEN ADVANTAGE OF THE NEW TAX CODE,  SELLING GOODS TO COOPS, AND IN RETURN, SEEING  MAJOR TAX BENEFITS.  <DEPENDING ON HOW THEY WRITE HTE LANGUAGE. I MEAN LAW CAN  SUPERCEDE, BUT IT COULD LEAD TO SOME LEGAL CHALLENGES,  DEPENDING ON HOW ANY REVISED LANGUAGE IS WRITTEN> NO MATTER THE OUTCOME, NEIFFER SAYS 2017 SHOULD  BE THE YEAR OF PLANNING WHEN IT COMES TO THE  NEW TAX LAW.  <IF WE CONTINUE TO HAVE 199A AND IT'S VERY FAVORABLE FOR FARMERS  THAT DEAL WITH COOPERATIVES THEN THAT'S SUPER PLANNING SO WE  THEN HAVE REGULAR PLANNING OR SUPER PLANNING AND WITH ANY EVEN  WITH THE REGULAR 199 A, THAT THAT'S A HUGE ADVANTAGE FOR A LOT OF  OUR FARMERS TO REALLY TAKE ADVANTAGE OF THAT. > WHETHER AN ADVATNAGE OR DISADVANTAGE, THE  INDSUTRY WITS FOR AN ANSWER FROM THE  UNCERTAINTY OF WASHINGTON.  SENATOR GRASSLEY IS ADVOCATING FOR SECTION 199A  TO GO BACK TO THE WAY IT WAS BEFORE THE PASSAGE  OF THE TAX REFORM BILL, WHERE IS A 9 PERCENT  DEDUCTION WHEN SELLING TO COOPS. BUT HE SAYS  HE'S UNCERTAIN ON WHETHER LANGUAGE REACHED  WILL INCLUDE MAKING IT RETROACTIVE TO JANUARY  FIRST. 

TEASE
UP NEXT, WE CONTINUE OUR MARKETING DISCUSSION  THIS WEEK. PLEASE, STAY WITH US.

ROUNDTABLE 2
ALL RIGHT WELCOME BACK. WELL YOU WERE TALKING ABOUT CORN DEMAND AND EARLIER ON IN THE SHOW AND SHOCKED YOU KNOW. WHAT'S YOUR OUTLOOK. I MEAN THIS DEMAND HAS BEEN IMPRESSIVE CANNOT IT CONTINUE. AND THEN WHAT IMPACT COULD THAT HAVE ON ENDING STOCKS. WELL WHEN WE DO THE NUMBERS AND WE LOOK AT 90 MILLION ACRES WE LOOK AT THE CURRENT DEMAND FOR THE U.S. AND CURRENT EXPORTS WE USE 178 YIELD WE COME UP WITH ENDING STOCKS THAT WON'T BE MATERIALLY DIFFERENT THAN THIS YEAR MEANING THAT THE MOST BEARISH SCENARIO WE CAN COME UP WITH MEANS ENDING STOCKS STAY ABOUT THE SAME. WHEN WE GET A SCENARIO IS THAT THE BEST CASE SCENARIO IS FLAT STOCKS. WE ARE VERY VERY BULLISH ABOUT A MARKET BECAUSE MOST LIKELY IT'S NOT GOING TO COME IN QUITE THAT GOOD. THE OTHER THING WE WANTED TO MENTION IS THAT CHINA IS DOING EXACTLY WHAT WE DID BACK TEN YEARS AGO WITH ETHANOL THEY ARE TAKING EVERY BUSHEL OF CORN THAT THEY CAN AND MAKE ETHANOL OUT OF IT AND THEY'RE ENDING STOCKS ARE FALLING VERY VERY RAPIDLY. IF THAT CONTINUES WHICH WE BELIEVE THAT IT WILL THEY ARE GOING TO BE A BIG BIG BUYER OF CORN IN THE FUTURE YEARS AND WE THINK THAT'S A LONGER TERM DRIVER FOR THE CORN MARKET. SO WHEN YOU SAY VERY VERY BULLISH I MEAN IT'S BEEN HARD TO BREAK THROUGH THAT 449    MARK. I MEAN ARE YOU TALKING DO YOU THINK WE COULD DO THAT. WE ACTUALLY BELIEVE THAT WHAT'S HAPPENED IN ARGENTINA WITH THE CORN CROP DOWN THERE WHAT WE SEE HAPPENING WITH DEMAND AND A WHAT WE THINK COULD BE A FIRST HALF DROUGHT SCARE IN THE U.S.. WE DO THINK IT'S POSSIBLE THAT WE COULD SEE THE JULY CONTRACT AT LEAST FOR A BRIEF BRIEF PERIOD OF TIME HIT FIVE DOLLARS. WE DON'T THINK THAT'S OUT OF THE QUESTION AT ALL THIS COMING SEASON 5 DOLLARS. I MEAN I KNOW PEOPLE ARE PERKING UP RIGHT NOW IS THAT LIKELY. THAT WOULD BE EXCITING. I DON'T THINK IT'S LIKELY. OUR PROJECTIONS FOR JULY CORN MIGHT BE TO THE 420 AREA. IF WE'RE LUCKY AND POSSIBLE DROUGHT SCARE COULD TAKE THE NEW CROP CORN RIGHT NOW UP TO 440 450 AREA. SO I THINK WHEN WE TALK ABOUT CORN THOUGH THE TO US THE MOST EXCITEMENT IS IN THE SOYBEANS BECAUSE WE WE'RE RIGHT NOW CONCERNED ABOUT WEATHER IN ARGENTINA. BUT BRAZIL'S CROP AND OUR CONTACTS IN BRAZIL THINK THAT WE COULD HAVE A 1 19 117 119 PRODUCTION OUT OF BRAZIL BECAUSE THE CROP IS SO GOOD EARLY HARVEST DOWN THEIR YIELDS ARE COMING IN ANYWHERE FROM THREE TO 10 PERCENT BETTER THAN A YEAR AGO ON RECORD YIELDS AND THEY HAD MORE ACRES AND MORE PLANTINGS SO THAT WOULD BE GOOD NEWS FOR PRICE. WOULDN'T BE GOOD FOR PRICE AND THE OTHER PROBLEM WE GOT IN THE U.S. IS THE DEMAND THIS EXPORT NUMBERS THAT CAME OUT THIS WEEK ON SALES WE COULD HAVE AS MUCH AS 273 MILLION BUSHELS THAT WERE NOT GOING TO MEET USDA DA'S GOALS THIS YEAR. WE'RE PROBABLY NOT GOING TO ADD THAT ALL TO THE BOTTOM LINE BUT IT CERTAINLY COULD ADD 50 TO 100 MILLION MORE BUSHELS TO CARRY OUT THAT WE'RE LOOKING AT FOR THIS COMING YEAR AND SOYBEANS. WE'RE TALKING ABOUT THE WEATHER MARKET AND HAVE THE MAYOR CUP AT THE MARKET TODAY HERE IN THE U.S. IS WEAK. I ME WHAT ARE THE PROSPECTS THAT THIS WEATHER MARKET WILL CONTINUE OR IS THIS REALLY SHORT LIVED. WELL EVERYTHING THAT WE SEE SAYS THAT THERE'S A GOOD LIKELIHOOD THAT THIS DRY WEATHER WILL CONTINUE FOR MANY AREAS OF THE HARD RED WINTER WHEAT AREAS I MEAN AND WE ALREADY HAVE A CROP THAT'S REALLY REALLY IN POOR CONDITION. WE ALREADY SUFFERED WINTER KILL ISSUE. AND WE BELIEVE THAT IF WE GET IN AND OUR WEATHER MODELS SUGGEST IT'S GOING TO BE A VERY WARM SPRING WE IN FACT POTENTIALLY SUMMERTIME TEMPERATURES IN MAY AND JUNE. SO IF WE GET SOME OF THAT HEAT AND WE GET SOME OF THAT DRYNESS AS WE COME OUT OF DORMANCY IN A CROP THAT'S ALREADY BEEN BEATEN UP A LOT. I MEAN WE REALLY COULD HAVE A CROP THAT'S DOWN YOU KNOW HISTORICALLY DOWN SOMETHING VERY VERY A HIGHER ORDER OF MAGNITUDE. IT ALMOST COULD BE THAT MINNEAPOLIS WEEK KIND OF A SHOCK IF WE GET THAT PERFECT STORM AND CONDITION REPORT YOU KNOW REALLY THAT'S BEEN A MARKET MOVER WHEN DID THE NEXT ONES COME. WELL THE USDA WILL RELEASE A CONDITION REPORT ON MONDAY AND WILL BE STATE BY STATE IT WON'T BE A WHOLE U.S. COVERAGE BUT THAT WAS THAT'S WHAT GOT THE MARKET EXCITED IN JANUARY. I THINK WE COULD SEE THAT DO THE SAME THING HERE AND THIS COMING WEEK SO WE'LL BE WATCHING THAT VERY CLOSELY. WE'RE EXCITED ABOUT WHEAT PRICES AS WELL. WE THINK THAT WE'VE GOT A LOT OF SUPPLY. SIX DOLLARS MAYBE A TARGET THERE. WOW. WELL ALSO IN THIS USDA OUTLOOK FORUM THIS WEEK THEY TALKED ABOUT PROTEIN AND THEY LOOK THEY'RE LOOKING FOR RECORD PRODUCTION IN 2018 FOR BEEF. I MEAN THAT'S REALLY NO SURPRISE AS WE SEE THIS CATTLE HERD GROW. BUT IT'S BEEN THIS BALANCING ACT BETWEEN SUPPLY AND DEMAND. DOES THAT BALANCING ACT CONTINUE IN THE COMING MONTHS. WE THINK IT'S VERY VERY DIFFICULT TO MAINTAIN THAT BALANCING ACT IN THE SECOND QUARTER. WE ARE LOOKING AT ONE OF THE BIGGEST FIRST QUARTER SECOND QUARTER BEEF INCREASES IN 20 YEARS ONLY SEEN THREE OTHER TIMES WHEN WE DID IT IN AN ANALOG ANALYSIS OF PRICE DURING THOSE ARE THE THREE YEARS PRICES FROM THE JANUARY HIGHS DECLINED 10 PERCENT INTO THE SPRING LOWS. WE FIND IT VERY HARD TO BELIEVE THAT THE MAN WILL MAINTAIN PRICES WHERE THEY CURRENTLY ARE WITH EXPECTING LOWER PRICES. ONLY 20 SECONDS. WHAT DO YOU THINK. I THINK THE PRICES ARE GOING LOWER. I THINK WE'VE GOT MORE MEAT GOOD WARMER WEATHER CONDITIONS GOOD WEATHER CONDITIONS THIS WINTER PUT MORE POUNDS ON WEIGHTS ARE GAINING IN BOTH THE STEERS AND HEIFERS SO MORE MEAT SUPPLY. ALL RIGHT THANK YOU FOR JOINING US OUR MARKET NOW SEGMENT IS NOW ON AG WEB.COM SO INVITES YOU TO TUNE INTO THE WEBSITE TO CHECK THAT OUT.

BAXTER BLACK
WELCOME BACK.  IT'S TIME NOW TO CHECK IN WITH BAXTER BLACK WHO  EXPLAINS WHY HE'S A COWBOY POET.  I'M A COWBOY POET AND I'M OFTEN ASKED WHY I DON'T WRITE MORE  FARMER POETRY. AND I TRY TO EXPLAIN TO PEOPLE THAT COWBOY POETRY  IS ABOUT REX. HORSE REX CATTLE WRECKS SHIPWRECKS DOG WRECK  FINANCIAL WRECKS TYRANNOSAURUS REX. ANY KIND OF WRECK YOU CAN  THINK OF FOR INSTANCE WHEN SOMEONE TELLS A STORY ABOUT A HORSE  BUCKING OVER THE HAYSTACK AND THEN PUT THE COWBOY IN THE PIG  PEN OR A WRITER MISSING A COW IN THE CHUTE AND GETTING RUN OVER  WHILE HE'S TRYING TO CHECK HER TEETH EVERYBODY LAUGHS THEIR  HEADS OFF FOR SOME REASON. A COWBOY GETTING BACKED OFF OR RUN OVER PLOWED DOWN DRUGS  THROUGH THE CAT TAILS TRAMPLED STOMPED OR BUTTED IS FUNNY. I'M  NOT SURE WHY I CAN THINK OF TWO POSSIBLE EXPLANATIONS. NUMBER  ONE THE COWBOY MENTALITY. AND NUMBER TWO THE COW HERSELF THE  COWBOY MENTALITY IS AN ATTITUDE VIEW OF LIFE. IT'S AN ABILITY TO FOCUS  SO INTENTLY ON ONE THING THAT THE OTHER PARTS OF THE PICTURE ARE  BLOCKED OUT. I MEAN LIKE LIKE HE'S STANDING ON A RAILROAD TRACK AT NIGHT  CONCENTRATING ON THE HEADLAMPS. SO HARD HE DOES NOT SEE. THE LOCOMOTIVE BEHIND HIM. AND THEN YOU MIX THE MENTALITY WITH NUMBER TWO THE HUMBLE  COW. THERE IS A FINE LINE BETWEEN FLIGHT OR FIGHT IN THE BOVINE  BEHAVIOURAL MECHANISM THAT THE COWBOY ALWAYS SEEMS TO BE  STRADDLING THE DIVIDE WITH A LEG ON EITHER SIDE. WHEN THE COW  MAKES HER DECISION FIGHT OR FLIGHT. EITHER WAY THAT COWBOY GETS  RUN OVER. SO IT ALL WORKS OUT. THUS, IT'S THE IDEA THAT ONE OF GOD'S  DUMBEST CREATURES SEEMS TO REGULARLY OUTWIT OUR COWBOY HERO  AND THAT MAKES IT FUNNY. ON THE OTHER HAND FARMER WRECKS ARE ALWAYS ABOUT MACHINE.  HANGING YOUR COVERALLS LEAVING THE PTO AND BEING STRIPPED  NAKED IN A NANOSECOND OR GETTING RUN DOWN BY A ROBOTIC  CONTROLLED CHEMICAL SPRAYING DRONE DOESN'T REALLY ELICIT LARGE  GUFFAWS. SO THAT'S WHY I DON'T WRITE MORE FARMER POETRY. OF  COURSE THERE'S ALWAYS THE ONE ABOUT THE FARMER'S DAUGHTER. THIS IS BAXTER BLACK FROM OUT THERE.

TEASE
THANKS, BAXTER.  WHEN WE COME BACK, JOHN JOINS US AGAIN FOR  CUSTOMER SUPPORT

CUSTOMER SUPPORT
WELCOME BACK. THE OVERSUPPLY SITUATION OF U-S  AG GOODS HAS MADE HEADLINSE THE LAST FEW  YEARS. BUT WHAT DOES IT MEAN FOR PRICES  FORWARD? HERE'S JOHN PHIPPS.  <THOMAS MARSH FROM KALONA, IOWA TOUCHES ON A POPULAR TOPIC  THESE DAYS: "FOR MANY YEARS , I HAVE HEARD THAT THE FUTURE CHALLENGE FOR  FARMERS IS TO FEED THE WORLD WITH A NEED FOR INCREASED YIELD AS  POPULATION SKYROCKETS. IS THIS STILL TRUE? KINDA HARD TO BELIEVE  WITH THE HUGE SURPLUS. WHAT DO WE HOPE FOR TO BRING PRICES UP  AND SURPLUS DOWN? 2018 NOT LOOKING REAL GOOD. DO NOT WISH BAD  WEATHER OR DROUGHT ON ANYONE." THOMAS, I TOO HAVE HEARD THAT MANTRA MY ENTIRE CAREER. AND JUST  LIKE NOW, MUCH OF THAT TIME HAS BEEN SPENT ENDURING YEARS OF  OVERSUPPLY OF MY CROPS. AS I RESULT I OFFER THESE  COUNTERARGUMENTS FOR THE "FEED THE WORLD" BUSINESS PLAN.  FIRST, ALWAYS REMEMBER THE FACT THAT FARMERS HAVE TO FEED A  GROWING WORLD POPULATION DOESN'T MEAN JUST US FARMERS. IT  MEANS THE FARMERS ALL OVER THE WORLD. THOSE COMPETITORS ARE RESPONDING TO DEMAND AS FAST AS WE ARE. BRAZIL HAS BEEN THE  LEADING EXPORTER OF SOYBEANS FOR A FEW YEARS, AND COULD  OVERTAKE THE US IN CORN IN THE NEXT FEW YEARS. UKRAINE WILL BE  CLOSE AS WELL. MEANWHILE, LESS POLITICAL UNREST IS ALLOWING VERY POOR COUNTRIES IN  AFRICA TO RAISE OUTPUT AS WELL. IT IS MUCH EASIER TO INCREASE THEIR  EXTREMELY LOW YIELDS THAN RAISE OURS A FEW PERCENT. IT TURNS OUT  THE BEST FERTILIZER IS PEACE. SO, WHILE THERE WILL BE A NEED FOR  MORE OUTPUT FROM FARMS, THOSE FARMS WILL BE ALL OVER THE WORLD.  ANOTHER POINT IS I THINK MUCH OF OUR MINDSET IS THE LEGACY OF  SCHOLAR ROBERT MALTHUS WHO FAMOUSLY PREDICTED THAT FOOD  DEMAND WOULD EXPAND EXPONENTIALLY WHILE FOOD SUPPLY COULD  ONLY GROW LINEARLY. HE WAS JUST FLAT-OUT WRONG, DUE TO FACTORS LIKE  AG TECHNOLOGY AND BIRTH CONTROL, BUT IT IS AMAZING HOW DURABLE  THIS BELIEF IS. I'LL LEAVE FORECASTS FOR PRICES TO OUR MARKET EXPERTS, BUT I AGREE IT  IS HARD TO ENVISION AN OUTCOME WITH MUCH HIGHER PRICES IN ANY  MAJOR COMMODITY IN THE US. THE RECENT 10 YEAR FORECAST FROM  THE USDA SAYS MUCH THE SAME. I THINK WE BETTER CONCENTRATE ON  BEING ABLE TO FARM WITH 3-SOMETHING CORN AND 9-SOMETHING  BEANS FOR THE FORESEEABLE FUTURE.> THANKS, JOHN.

TEASE
AND IF YOU HAVE A QUESTION OR A COMMENT FOR  JOHN, JUST EMAIL HIM AT MAILBAG AT U-S FARM  REPORT DOT COM. WHEN WE COME BACK, THE OLYMPIC SPIRIT HIT ONE  RANCH. WE'LL SHOW YOU THE VIDEO NEXT. 

FROM THE FARM
WELCOME BACK,  WELL, APPARENTLY THE OLYMPIC SPIRIT IS CATCHING  ON... EVEN SPILLING OVER INTO PASTURES.  KARLY POSTED THIS VIDEO... SAYING THEY'GE BEEN  INSPIRED BY TEH OLYMPICS. AND THEY WANT HAY  CURLING TO COME TO THE NEXT WINTER GAMES. KARLY- - WE THINK THIS VIDEO IS GOLD. BUT MIKE, YOU ACTUALLY YOU'VE DONE CURLING IN THE PAST. I HAVE DONE CURLING AND IT'S FUN. IS IT A TOUGH SPORT? WELL, IT'S TOUGH TO DO CORRECTLY YES. BUT NO YOU OND'T GET WINDED OR ANYTHING. ALRIGHT, YOU MAY HAVE TO TEACH ME.  BUT GROWERS  IN CALIFORNIA TRYING TO SAVE THEIR CROPS FROM  MOTHER NATURE. ICE HANGING ON THESE PRECIOUS  ALMOND TREES... AND THAT COULD BE DAMAGING TO  THIS YEAR'S CROP. PRODUCERS LIKE DON CAMERON SPRAYED WATER ON  THE TREES IN HOPES OF SAVING THE CROP, BUT IT'S TOO EARLY TO TELL THE DAMAGE THAT WAS CAUSED  THIS WEEK  YEAH, I THINK  WE ARE SEEING SOME DAMAGE IS WHAT WE HEARD FROM RABOBANK. AS WE REPORTED EARLIER IN TEH SHOW BUT WHAT'S THE MAJOR WEATHER EVENT THAT YOU'RE WATCHING NEXT WEEK. WELL, WE STILLS EE THE TROPH  STAYING IN THE WEST KIND OF DIGGIN GIN OCCASTIONALLYU BUT THERE'S SIGN THE TROPH MAY ALSO DEVELOPIN THE EAST WHICH WOULD BE AN INTERESTING PATTER. BY THE END OF NEXT. BUT WE'LL HAVE TO WAIT AND SEE ON THAT. WELL SPEAKING OF CALIFNRINA, WE WILL BE THHERE NEXT WEEK. SO IF YOU'RE ATTENDING COMMODITY CLASSIC NEXT  WEEK, PLAN TO JOIN OUR U-S FARM REPORT TAPING AT  7 A.M. MARK GOLD, MIKE NORTH, CHIP FLORY AND  ARLAN SUDERMAN ARE THE MARKETING PANELISTS. IT'S  ALWASY A FUN SHOW TO ATTEND.  AND DON'T FORGET TO LET US KNOW WHAT YOU THINK  ABOUT THE NEW FORMAT OF THE SHOW. YOU CAN  EMAIL US OR SEND US A NOTE ON FACEBOOK AND OR  TWITTER WELL, I ENJOYED THE NEW FORMAT, MIKE.


CLOSE
FROM ALL OF US AT U.S. FARM REPORT, I'M MIKE  HOFFMAN.  AND I'M TYNE MORGAN.  THANK YOU FOR WATCHING U-S FARM REPORT.  BE SURE TO JOIN US RIGHT HERE AGAIN NEXT WEEK, AS  WE WORK TO BUILD ON OUR TRADITION. HAVE A GREAT  WEEKEND, EVERYONE.  

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