USFR Weekly Recap - February 3-4, 2018

February 3, 2018 03:30 AM
 
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TODAY ON U.S. FARM REPORT
FEBRUARY 3-4, 2018

HEADLINES

WELCOME TO U.S. FARM REPORT. I'M TYNE MORGAN,  AND HERE'S WHAT WE'RE WORKING ON FOR YOU. NAFTA NEGOTIATIONS DRAWING OUT A SENSE OF  OP<WE BELEIVE SOME PROGRESS WAS MADE.> AS THE CATTLE INDUSTRY KICKED OFF IN ARIZONA THIS  WEEK, CATTLE PRODUCERS GETTING THEIR FIRST LOOK  <I THINK IT'S A FAVORABLE OUTLOOK FROM THE CONCERN OF THE GROWTH  WE MIGHT BE HAVING, IT'S MUCH MORE METERED>  BUT THE PRESSURE HEATS UP ON DEMAND IN 2018.  THE JOURNEY OF LIFE CAN SOMETIMES TAKE AN  UNEXPECTED COURSE.  <  TWO YEARS INTO MY CAREER MY DAD GOT DIAGNOSED WITH CANCER  AND IT TOTALLY CHANGED EVERYTHING.> IT'S A STORY OF PASSION AND PERSERVERANCE IN  NEBRASKA.  AND IN JOHN'S WORLD TARIFFS IN THE FUTURE. <U.S. FARM REPORT - BROUGHT TO YOU BY THE DEPENDABLE, LONG LASTING, CHEVY SILVERADO.>

TRADE TALKS
NOW FOR THE NEWSS, WHILE THE PRESIDENT BARELY  MENTIONED TRADE DURING HIS FIRST STATE OF THE  UNION ADDRESS, THE TONE ON TRADE THAT SEEMED  MORE UPBEAT THIS WEEK AFTER CANADA, MEXICO AND  THE U-S WRAPPED UP THE FIFTH ROUND OF NAFTA  NEGOTIATIONS.  <WE BELEIVE SOME PROGRESS WAS MADE. WE CLSOED ONE  CHAPTER, AS ELDAFONZA SAID IT WAS TEH CAHPTER ON CORRUPTION,  WHICH WAS A VERY IMPROTANT CHAPTER, AND WE MADE SOME  PROGRES ON A FEW OTHERS.>  AFTER WRAPPING UP THE SIXTH ROUND OF TALKS IN  CANADA LAST WEEK,  THERE'S A SENSE OF OPTIMISM IN  THE AIR. WITH U-S TRADE REPRESENTATIVE ROBERT  LIGHTHIZER CALLING IT A STEP FORWARD.  TRILATER LEADERS BEGAN TO DISCUSS CORE ISSUES,  BUT LIGHTHIZER SAYS PROGRESS IS SLOW.  HEADWAY WAS MADE ON FOOD-SAFETY MEASURES,  DIGITAL TRADE AND TELECOMMUNICATIONS. WITH  LEADERS SAYING THEY'RE ABOUT 90 PERCENT  COMPLETE AND COULD POSSIBLY FINALIZE  NEOGITAIONS ON THOSE ISSUES  BUT ONE AREA WHERE NEGOTIATERS COULDN'T AGREE  WAS AUTO.  <WE FIND THAT HTE AUTOMOBILE IDEA THAT WAS PRESENTED,  WHEN ANALYZED, ACTUALLY LED TO LESS REGIONAL CONTENT THAN WE  HAVEN OW., FEWER JOBS IN TEH UNITED STATES, CANADA AND LIKELY  MEXICO. AND SO IT'S THE OPPOSITE OF WHAT WE'RE TRYING TO DO> BUT JUST A DAY AFTER THE NAFTA PRESS  CONFERENCE, MEXICO SAYING THEY ARE OPEN TO  CHANGES TO RULES OF ORIGIN FOR AUTOMOBILES  PROPOSED BY THE U-S.  IT WOULD BUMP UP THE REQUIREMENT FROM TEH  CURRENT 62.5 PERCENT OF THE NET COST OF  PASSENGER CAR OR LIGHT TRUCKS MUST ORINATE  FROM ONE OF THE THREE COUNTRIES TO A NEW 85 PERCENT THRESHOLD.  WHILE PROGRESS WAS MADE, A NEW DEAL IS STILL INTHE WORKS.  AND NOW COBANK SAYS ISSUES SURROUND TRADE  POSE A REAL THREAT TO U-S BEEF PRODUCERS.  WITH FOUR OF THE TOP FIVE BEEF BUYERSE FOR THE U- S AT RISK OF TRADE DISRUPTION. COBANK SAYS JAPAN, SOUTH KOREA, MEXICO, CANADA  AND HONG KONG ACCOUTN FOR 83 PERFCENT OF ALL U- S BEED EXPORTS. AND ONLY THE ONLY LOCATION THAT  WON'T BE IMPACTED BY CURRENT TRADE PACT  NEGOTIATIONS IS HONG KONG. 

GROWING CATTLE HERD
GROWING CONCERNS ABOUT TRADE WHILE THE U-S  CATTLE HERD KEEPS GETTING BIGGER,BUT THE  EXPANSION IS SLOWING DOWN.  USDA'S QUARTERLY CATTLE INVENTORY REPORT  SHOWING THE NATION'S HERD HIT THE HIGHEST LEVEL  IN NEARLY A DECADE, AT 94 POINT 4 MILLION HEAD. THAT'S ONE PERCENT ABOVE LAST YEAR.USDA SAYS ALL COWS AND HEIFERS THAT HAVE CALVED  HIT 41 POINT 1 MILLION HEAD, ALSO ONE PERCENT  ABOVE LAST YEAR.  BEEF COWS ACCOUNT FOR 31 POINT 7 MILLION HEAD OF  THAT NUMBER, WHICH IS UP 2 PERCENT.  AND THE NUMEBR OF MILK COWS ROSE 1 PERCENT, AT 9  POINT 4 MILLION HEAD.  

DROUGHT MONITOR, CATTLE
GRAZING CONDITIOSN ARE STRUGGLING IN THE PLAINS  AS DRYNESS GRIPS THE AREA. AND IT'S A DROP IN CROP  RATINGS THAT TIPPED OFF A NEW RECORD TRADING  VOLUME FOR KANSAS CITY WHEAT ON WEDNEDAY.  IN USDA'S MONTLY CONDITION REPORT, THE AGENCY  INDICATING OKLAHOMA WHEAT FIELDS ARE SHOWING  THE EFFECTS OF DROUGHT WITH 79-PERCENT CALLED  POOR TO VERY POOR. .IN KANSAS - 14 PERCENT IS GOOD TO EXCELLENT.  THAT'S A CONSIDERABLE DROP FROM A MONTH AGO  WHEN 37-PERCENT OF THE CROP EARNED THOSE  GRADES. .44-PERCENT OF KANSAS WHEAT IS POOR TO VERY  POOR. .TO THE NORTH - MONTANA WHEAT RATES 66-PERCENT GOOD TO EXCELLENT. AND IT'S DRYNESS THAT FUELED THE WHEAT MARKET  THIS WEEK.  <WE'VE GOT A LITTLE BIT OF A WEATHER SCARE ON OUR HANDS HERE  CERTAINLY AND IT HAS HELPED TO PROP UP PRICES MOVING FORWARD  HERE. YOU KNOW WE'VE GOT TO KEEP AN EYE ON THE WEATHER BUT THE  WEAK U.S. DOLLAR IS SOMETHING THAT HAS ALSO BEEN A POSITIVE  FACTOR FOR COMMODITY MARKETS AND THAT MAY BE ADDING FUEL TO THE  FIRE HERE. YOU KNOW THE WEATHER'S THE BIGGEST ISSUE BUT THE  WEAK DOLLAR CERTAINLY HELPS.> REUTERS REPORTS THAT THE VOLUME TRADED FOR KC  WHEAT ON WEDNESDAY, SURPASSED THE PREVIOUS  RECORD SET IN NOVEMBER 2017. THOSE RECORDS GO  BACK TO 1980. 

WEATHER
THOSE ARE THE HEADLINES...METEOROLOGIST MIKE  HOFFMAN JOINS US NOW WITH WEATHER...MIKE,  DRYNESS IS REALLY THE STORY RIGHT NOW WHEN IT  COMES TO THE PLAINS.  THAT'S RIGHT. THE DROUGHT CONTINUES TO EXPAND AND I DON'T  SEE A LOT OF MOISTURE OVER THE NEXT WEEK IN MOST OF THESE AREAS  AS WELL. WE'LL SHOW YOU THOSE MAPS COMING UP BUT YOU CAN SEE  THE DROUGHT MONITOR FOUR WEEKS AGO NOT QUITE AS MUCH ORANGE  AND RED ON THE MAP AS WE'VE GONE THROUGH THE PAST FOUR WEEKS.  YOU CAN SEE HOW IT'S JUST KIND OF BEEN EXPANDING ESPECIALLY IN  THIS AREA THERE WESTERN OKLAHOMA AND NORTHERN TEXAS SOUTHERN  KANSAS BACK INTO THE SOUTHWEST. BUT THERE HAS BEEN SOME  EXPANSION OF PANHANDLE OF FLORIDA INTO PARTS OF THE OTHER PARTS  OF THE SOUTHEAST AS WELL. IT JUST KIND OF LINGERS ACROSS THE  DAKOTAS INTO MONTANA. BUT THAT HAS ACTUALLY IMPROVED A LITTLE BIT  RECENTLY. HERE'S THE FORECAST AS WE HEAD THROUGH THIS WEEK ON MONDAY WE'RE LOOKING FOR LINGERING SNOW FROM HIS SYSTEM THROUGHOUT MOST OF NEW ENGLAND. MOST OF THE EAST COAST JUST  GOING TO BE COLD LINGERING SHOWERS IN FLORIDA. SEVERAL SYSTEMS  ARE GOING TO BE DIVING ACROSS THE COUNTRY OUT OF THE WESTERN  PORTIONS OF CANADA INTO THE CENTRAL SECTIONS AND THEN MOVING  NORTHEAST EACH ONE OF THEM WILL BRING SOME SNOW. I'M EXPECTING  SOME ACROSS THE MISSOURI VALLEY BACK INTO THE NORTHWEST ON  MONDAY WEDNESDAY. THAT FIRST SYSTEM KIND OF DOUBLE BARREL  THERE MOVING THROUGH THE NORTHEAST AND THE OHIO VALLEY WITH  SOME SNOW IN BOTH OF THOSE AREAS. EAST COAST GENERALLY RAIN  SHOWERS MAYBE THUNDERSHOWERS IN FLORIDA. NEXT SYSTEM DIVING  INTO THE WEST NORTHWESTERN PLAINS IN THE NORTHERN ROCKIES. THAT  SYSTEM WILL BE MOVING THROUGH THE OHIO VALLEY BY FRIDAY WITH A  PRETTY GOOD CHANCE FOR SNOW.   NOW DO YOU KNOW THESE STORMS COULD MOVE A LITTLE BIT  FARTHER NORTH AND SOUTH AND WE HAVE PROJECTED HERE SO JUST KEEP  THAT IN MIND. WE'LL HAVE YOUR LONGER RANGE FORECAST INCLUDING THE  90 DAY OUTLOOK COMING UP IN OUR NEXT HALF HOUR. 

TEASE
THANKS, MIKE. WE NEED TO TAKE A QUICK BREAK, BUT  WHEN WE COME BACK, JOHN PAYNE AND JIM  MCCORMICK JOIN US TO TALK MARKETS. FROM WHEAT  AND COTTON TRENDS, TO THE LARGER CATTLE HERD,  WE'LL COVER IT ALL DURING OUR MARKETING  DISCUSSION THIS WEEK. 

ROUNDTABLE 1
WELCOME BACK. TIME NOW FOR THE MARKETING ROUNDTABLE. JOHN PAYNE AND JIM MCCORMICK TO TALK MARKETS THIS WEEK. WE'LL START OFF TALKING ABOUT WHEAT. KNOW SOME DRYNESS CONCERNS SOME WEATHER CONCERNS REALLY FUELING WHEAT PRICES KIND OF MID WEEK AND THEN WE TRAILED OFF A LITTLE BIT. WHAT'S THE STORY RIGHT NOW DO YOU THINK IN WEEKS. WELL TWOFOLD OBVIOUSLY THE DROUGHT OUT IN THE SOUTHERN PLAINS HAS BEEN PUBLICIZED QUITE A BIT HERE IT'S PUSHED PRICE REALLY VERSUS A VERY. ABUNDANT GLOBAL SUPPLY AND RUSSIA SLOWLY BUT SURELY TAKING A LOT OF OUR MARKET SHARE OVER THE LAST COUPLE OF YEARS THEIR CROP LOOKS PRETTY GOOD RIGHT NOW. SO WE HAVE KIND OF A DICHOTOMY OF MARKETS. YOU HAVE A BIG GLOBAL SUPPLY THAT SHOULD BUFFER PRICE ON THESE RALLIES. BUT AS A PRODUCER ON THE WESTERN PLAINS IT'S DIFFICULT TO TAKE ADVANTAGE OF IT ESPECIALLY A NEW CROP BECAUSE IT'S TOUGH TO SELL WHAT YOU DON'T THINK YOU'RE GOING TO GROW.  WELL INTERESTING TO SEE IT SEE A WEATHER RALLY THIS TIME OF YEAR. IT WHEAT RIGHT NOW. BUT DO YOU THINK THERE'S MORE ROOM IS THERE MORE UPSIDE POTENTIAL FOR WHEAT PRICES.  I THINK THERE IS MORE UPSIDE POTENTIAL. THE MARKET KIND OF GOT EXCITED THIS WEEK WHEN THE CROP READINGS CAME OUT AND SHOWED THAT 14 PERCENT OF KANSAS CROP IS RATED GOOD TO EXCELLENT. IT PRODUCED ROUGHLY A QUARTER OF OUR CROP WE THINK AS WE COME OUT OF DORMANCY WE PROBABLY HAD SOME WINTER PROBLEMS AS JOHN POINTED OUT THE DROUGHT IS GOING ON STRONG IF THAT CONTINUES I THINK AS WE COME OUT WE SHOULD BE A LITTLE BIT MORE PUSH. ONE OF THING OUT THERE THE DOLLAR CONTINUES THE WEEKEND AND IT'S GETTING A LITTLE BIT MORE COMPETITIVE ON THE INTERNATIONAL PRICE. THERE'S NO DOUBT ABOUT IT. RUSSIA IS TAKING SOME OF OUR EXCITING A AWAY OVER THE YEARS OF COMPETITION. BUT. WE THINK IT CAN GET BACK UP TOWARD 5.

 TOWARD 5. AT PRICES LIKE THAT THAT JOHN DO YOU THINK THERE'S ROOM TO BUY SOME ACRES.  NO NOT AT 5. I DON'T THINK WE'RE HIGH ENOUGH AND WE WENT A YEAR AGO UP TO 570 FRONT LINE SIX HOURS TO JULY PRODUCERS HAD A CHANCE TO TRY TO LOCK THAT IN YOU KNOW ACREAGE OUT EAST IS GOING TO EXPAND ON THAT BUT WE THINK OUT WEST HERE YOU KNOW IT'S JUST A NUMBERS GAME AND THERE'S JUST NOT ENOUGH CAPITAL THAT'S GOING TO BE MADE. REVENUE STREAMS VERSUS OTHER THINGS THEY CAN GROW. AND IN THE SHORT RUN THERE THEY'RE GOING TO. I THINK NEXT YEAR IF THIS YEAR GOES WELL AND WE'RE SEEING A LOT OF GUYS SHIFT TO COTTON IN KANSAS IF THAT WORKS I THINK YOU'RE GOING TO SEE ACREAGE STAYED THE SAME REGION FOR A LITTLE BIT AND WE'LL GET INTO COTTON IN A SECOND. JIM THEN CONSIDERING WHERE WE SEE PRICES TODAY GET WEIRD HOW DO YOU SEE THIS ACREAGE GAIN SHAKING OUT.  GARY NO WE THINK IT'S REALLY GOING TO BE INTERESTING JOHN. I THINK WE'RE GOING TO LOSE ACRES IN THE SOFT COTTON. I THINK WE'LL DO SOME CORN ACRES AND ACRES TO COTTON WHAT'S NORTH THOUGH I CAN ADD IN THE NORTHERN CORN BELT WE'VE PICKED UP A LOT OF BEAN ACRES OVER THE YEARS. I THINK A LOT OF THAT'S GOING TO GO BACK TO SPRING WHEAT BECAUSE THE FARMERS UP THERE OUR CUSTOMERS ARE GETTING TIRED OF PAYING AND GETTING SOME THREE DOLLAR CASH CORN. THEY'RE BROKE. SO THEY'RE TRYING TO DIVERSIFY A LITTLE BIT INTO SPRING WHEAT IN THE MIDWEST THOUGH THE ISOLATED THE BANKERS ARE FORCING US INTO BEANS. SO I THINK WE'RE GOING TO SEE SOME BEAN ACRES INCREASE AS A NET BECAUSE THE ECONOMICS THEY PLANTED TEN DOLLAR BEANS AND A MOVE AWAY FROM CORN AND EVEN POSSIBLY RIP UP SOME WHEAT. IF IT'S DRY ENOUGH.  OK SO IF WE DO SEE MORE SPRING WHEAT THAT TAKES AWAY FROM CORN ACRES SO THEN BEAN ACRES LIKE HOW HOW HIGH ARE YOU TALKING.  I DIDN'T GET UP 91 AND MAYBE 92 MILLION ACRES A BENIN'S WHEN IT'S ALL SAID AND DONE. SO WE'RE GOING TO PLANT MORE BEANS AND CORN FOR THE FIRST TIME EVER.

 I'M HEARING A LOT OF 91 AND A HALF I'VE HEARD SOME 92. DO YOU AGREE WITH THAT.  YEAH I MEAN IT'S I THINK BEANS WILL BE HIGHER THAN CORN. I COULD PROBABLY POINT TO THE LAST FOUR YEARS WHERE GUYS WOULD HAVE SAT ON THIS SET AND SAID THE SAME THING PRODUCERS. THE ONE THING I'VE LEARNED IN MY TIME YOU GUYS OUT THERE LIKE TO PLANT CORN THAT'S THE WAY IT IS. AND YOU CATCH A LITTLE MOVE HERE IF WE COULD IF WE COULD CATCH A MOVE OFF THIS AUSTRALIAN DROUGHT. I'M SORRY ARGENTINIAN DROUGHT AND PUSH PRICES HIGHER. I THINK CORN COULD GAIN SOME ACREAGE BACK. OK.  SO CONSIDERING THE POSSIBILITY OF ACRES CONSIDERING DEMAND HAS KIND OF PICKED UP A LITTLE BIT IN CORN. DO YOU THINK WE HAVE ROOM TO MOVE CORN PRICES HIGHER.  I DO THINK WE HAVE ROOM TO MOVE CORN PRICES HIGHER. THE FUNDS ARE SHORT A LOT OF CORN. THE DOLLAR IS WEAKENING. I THINK YOU CAN SEE THE FUNDS GET OUT OF IT. YOU'VE GOT A DRYNESS ISSUE IN ARGENTINA WHICH IS HURTING THEIR CROP A LITTLE BIT. THE WITNESS. BRAZIL'S ALSO BECOME A PROBLEM. TIME THEY CAN GET TO EARLY BEANS OUT THEY CAN GET IT EARLY. BEANS OUT THEY WON'T BE ABLE TO GET THEIR SECOND CORN CROP IN. SO THERE'S AN ONGOING STORY THAT I THINK THE FUNDS ARE JUST GOING TO SAY HEY LOOK I DON'T WANT TO BE SURE ALL OF THIS HUGE GRAIN INFLATION. JOBS JOBS ARE COMING HOME STRONG. AND I THINK THAT'S ANOTHER KEY OUT THERE. THAT'S THE UNDERLYING DATA OUTSIDE MARKET THAT WE MIGHT SEE AS INFLATION PLAY. ALL  RIGHT. SO A POSSIBILITY THAT WE COULD SEE CORN PRICES MOVE HIGHER BUT WHAT ABOUT BEANS. IS THERE SOME ROOM FOR GROWTH OR SHOULD YOU GET THOSE PRICE RIGHT NOW. PLUS WHEN YOU TALK COTTON CATTLE WILL DO ALL OF THAT THEY COME BACK ON U.S. FARM REPORT

ROUNDTABLE 2
ALL RIGHT WELCOME BACK. WELL RIGHT BEFORE THE BREAK WE WERE TALKING ABOUT CORN PRICES POSSIBLY A DEMAND STORY THERE THAT WE COULD POSSIBLY SEE CORN PRICES MOVE HIGHER. BUT WHAT ABOUT THINGS WHEN YOU WE SAW TEN DOLLARS ON THE BOARD THIS WEEK. AWFULLY NICE. I MEAN IS THAT SOMETHING THAT YOU THINK PRODUCERS SHOULD TAKE ADVANTAGE OF RIGHT NOW.  YEAH I THINK YOU SHOULD TAKE ADVANTAGE OF IT NOW ONLY IF YOU CAN TAKE ADVANTAGE OF FURTHER RALLIES IF YOU'RE GOING TO USE THE BOARD OR USE SOME SORT OF STRATEGY OR USE AND MARGIN. I THINK THAT'S THE TRACK YOU CAN FALL INTO AT THIS TIME OF THE YEAR WHEN YOU SELL TOO EARLY. IF YOU'RE USING THE CASH MARKET AS AN END USER I THINK BY ALL MEANS I THINK YOU NEED TO START MAKING SALES HERE. I WILL SAY A YEAR AGO WE AVERAGE 10 20 IN FEBRUARY WEAKER DOLLAR FIVE POINT FOUR PERCENT GDP IN THIS FIRST QUARTER. I DON'T THINK IT'S A STRETCH TO THINK WE COULD SEE 10 40 10 30 OK.  BUT IF WE DO SEE MORE ACRES DO YOU. DO YOU AGREE WITH THAT. I MEAN DO YOU THINK WE COULD GET TO 30 TO 40. ARE YOU SAYING LOOK AT THESE PRICES WE HAVE TODAY.  MY I AGREE WITH JOHN I THINK YOU KNOW THE DOLLAR FUNDS WANT TO GET INTO THIS WE COULD GET UP THERE. BUT I GUESS MY ARGUMENT IS IF YOU'RE MAKING MONEY PRODUCERS LOCK IT IN MAKE THE BUSINESS DECISION TO LOCK IN IT BECAUSE THE BIG PROBLEM WE HAVE IS DEMAND RIGHT NOW. THE CURRENT EXPORT PIECE IS 30 PERCENT BEHIND LAST YEAR'S NUMBER. AND WHAT'S CRITICAL ABOUT THAT IS WE KEEP THIS PACE UP. WE'RE GOING TO MISS THAT DEMAND NUMBER BY ALMOST 300 MILLION BUSHELS WHICH MEANS YOUR CARRY OUT TO ABOUT 470 MILLION. IT PUSHES TOO OBSCENE OBSCENE 6 700 MILLION CARRYOUT. FUNDAMENTALLY YOU CAN HAVE TEN DOLLAR BEANS THAT WAY. WE WILL BURY OUR OF BEINGS IF WE DO NOT GET THIS DEMAND IN LINE PLAIN AND SIMPLE.  I WILL SAY I AGREE WITH THEM ON THAT. I MEAN I THINK THE U.S. CARRIERS COULD GROW BUT THIS IS A GLOBAL MARKET AND THE CHINESE DEMAND NUMBERS ARE GOING TO CONTINUE TO GO UP. AND IF THE U.S. ISN'T SELLING IT SOON THE BRAZILIANS WILL AND IT PUTS MORE STRESS ON THEM TO GROW IT IN THE FUTURE AND WILL DROP ACRES SO I DO AGREE THAT WE'LL SEE PRICES AND THE POTENTIAL FOR PRICES TO BE VERY WEAK. BUT. I THINK YOU HAVE TO SAY IN THIS KIND OF GLOBAL GROWTH STORY THAT WE HAVE GOING ON RIGHT NOW TO UNDERCUT DEMAND IS I THINK A MISTAKE AND WHETHER THE U.S. IS GETTING OR NOT I THINK DEMAND OVERALL IS GOING TO GO UP NEXT YEAR. JIM REAL QUICK WHEN WILL WE REALIZE WHAT KIND OF CROP IN SOUTH AMERICA HAS IT'LL PICK AT LEAST ANOTHER GOOD MONTH I MEAN RIGHT NOW FOR THE MOST PART OUR AUGUST MATCHES UP OF THEIR FEBRUARY PUT PRESETS WERE PRETTY GOOD. SO IF THEY GET GOOD RAINS IN THE NEXT FOUR WEEKS THAT CAN REALLY BRING BACK THE CORN CROP THOSE KIND OF AND THE POLLINATION FILL THAT DAMAGE MAY BE DONE.

 SOYBEANS CORN AND NOW COTTON COTTON PRICES THAT HAD BEEN SO STRONG AND THEN WE KIND OF SAW HIM REALLY FALL THIS THIS MONTH. WHAT IS CAUSING THOSE PRICES TO SEE SOME PRESSURE. WELL I THINK A COUPLE OF THINGS HAPPENED. WE WENT INTO THE HARVEST A LITTLE BIT THIRSTY FOR COTTON AND THE MARKET WAS WILLING TO PAY UP FOR IT AND THE JINDE BUSINESS IN THIS IN THIS COUNTRY WE'VE SLOWED. WE CLOSED A LOT OF GINS OVER THE LAST 10 YEARS AND AS WE INCREASE PRODUCTION THIS YEAR WE HAD KIND OF A BACKLOG SO TO SPEAK OF PRODUCT TRYING TO GET THROUGH THE SYSTEM AND I THINK THERE WAS HANDS GOING UP FOR COTTON THAT THEY NEEDED RIGHT AWAY AND WE'RE SLOWLY GETTING THROUGH THAT NOW GOING INTO MARCH DELIVERY OR AS WIDE UNDER MAY AS WE'VE BEEN. SO I THINK WE'RE GETTING THAT SUPPLY ESSENTIALLY COMING TO MARKET. WELL THIS WEEK BIG WEEK WITH NCBA IN ARIZONA GOING ON AND WE GOT OUR CATTLE INVENTORY REPORT NO SURPRISE BIGGER CATTLE INVENTORY REPORT. WE EXPECTED THAT GOING INTO THIS WEEK BUT IT WAS LOWER THAN WHAT KIND OF TRADE EXPECTED. SO IS THAT A GOOD SIGN. WELL I THINK IT'S A GOOD SIGN. OVERALL. I MEAN WHAT'S DRIVING THE MARKET RIGHT NOW. I THINK THE CATTLE HERD WE GOT THE NUMBERS IN A PRETTY MUCH WITH REALLY TRADING, TYNE, IT'S DEMAND. OKAY. THE MARKET IS VERY VERY OPTIMISTIC WITH THE STOCK MARKET AND TEAR UP UNTIL THE LAST FEW DAYS THAT THAT'S GOING TO INCREASE DEMAND DOMESTICALLY. BUT IMPORTANTLY INTERNATIONALLY EXPORT SALES WERE STRONG AGAIN THIS PAST WEEK SO WE'RE SELLING IT AND I THINK THAT'S THE BIG KEY TO THE CALLUP COMPLEX IS CAN DEMAND MEET THE BUILDING SUPPLY WE ARE GOING TO EXPECT TO SEE DOWN THE LINE AND WE DO HAVE SOME TRADE CONCERNS BUT WEAKER U.S. DOLLAR. HOW LONG DOES IT REAL QUICK HOW LONG DOES THAT TAKE IT TO COME INTO PLAY. I MEAN I THINK IT'S IN PLAY NOW. I THINK THE GDP NUMBERS WE GOT THIS WEEK ARE HUGE YOU CAN'T DISREGARD. WE'RE MOVING WE'RE GROWING LIKE CHINA IS GROWING. OKAY. ALL RIGHT THANK YOU BOTH GO TO BREAK AND THEN WE'LL GET THEIR CLOSING THOUGHTS.

MARKETS NOW
WELCOME BACK, TIME NOW FOR CLOSING THOUGHTS, JOHN. WELL I'M GOING TO TALK TO THE CORN PRODUCERS OUT THERE. RUBBER MEET THE ROAD TIME IN THE NEXT COUPLE OF WEEKS AS WE GO INTO MARCH DELIVERY YOU'LL HAVE A DECISION TO MAKE HERE 367 375. WHAT DO YOU DO. DO YOU ROLL OR PRICE. I THINK YOU TAKE THE MONEY AND THEN LOOK TO TRY TO RETURN IT LATER IN THE SUMMER WHEN THE WEATHER GETS BAD. THINGS ARE LOOKING UP THOUGH. DON'T. DON'T BE READING TOO MUCH INTO THE FUNDAMENTALS. OUTSIDE MARKETS HAVE BAD FUNDAMENTALS AND WE'VE SEEN RALLIES AND I THINK WE'LL SEE THAT SAME KIND OF ACTION IN THE ROW CROPS THIS SUMMER. ALL RIGHT JOHN THANK YOU JIM. THIS YEAR PRODUCERS WERE GOING TO RECOMMEND GUYS BE PROACTIVE AND PROFITABLE LOCK IN THE PROFITS. USE THE BOARD USE SOME OPTIONS TO MAINTAIN SOME OWNERSHIP IN THE SUMMERTIME. IT IS DRY RIGHT NOW IN THE MIDWEST. A LOT OF PEOPLE'S CONCERNS WE KNOW SO CHEAP CALLS WILL KEEP YOU IN THE PLAY FOR THE SUMMER BUT LOCK IN PROFITS. THE BANKERS WANT YOU GUYS TO LOCK IN PROFITS. THE BALANCE SHEETS ARE TIGHT AND MAKE THEM HAPPY LOCK IT IN AND YOU SOME OPTIONS MAKING OWNERSHIP.  ALL RIGHT. JOHN THANK YOU SO MUCH FOR JOINING US. ALL RIGHT TO TAKE A BREAK GETTING IN HERE ABOUT TRADE FROM JOHN PHIPPS.

JOHN’S WORLD
WE TALKED ABOUT THE CURRENT STATE OF NAFTA  EARLIER IN THE SHOW. BUT IT'S A POSSIBLE TRADE  BATTLE BREWING WITH CHINA THAT'S ALSO A CONCERN  FOR U-S AG. HERE'S JOHN PHIPPS.  RECENTLY, THE TRUMP ADMINISTRATION ANNOUNCED TARIFFS ON SOLAR  PANELS AND WASHING MACHINES. IT ALSO HINTED AT STEEL AND  ALUMINUM TARIFFS TO COME, WHILE ASSERTING THAT THIS WON'T CAUSE A  TRADE WAR. LET'S ASSUME THAT'S TRUE - THAT FULL BLOWN RETALIATION WON'T  HAPPEN. WHAT OTHER POSSIBLE REPERCUSSIONS ARE THERE? AS  NEBRASKA REPUBLICAN SENATOR BEN SASSE NOTED, TARIFFS ARE PAID  NOT BY IMPORTERS BUT BY CONSUMERS. LG WASHERS AND SOLAR  PANELS WILL SIMPLY COST MORE. BUT IN THE CASE OF SOLAR TARIFFS,  THERE ARE LOOPHOLES AND BASIC ECONOMICS TO MITIGATE AND  EVENTUALLY NEUTRALIZE THE EFFECT. FOR EXAMPLE, THE US IS A  RELATIVELY SMALL MARKET FOR SOLAR PANELS, ESPECIALLY COMPARED TO  CHINA ITSELF. MEANWHILE THE PRICE OF SOLAR PANELS HAS BEEN  PLUMMETING FOR OVER A DECADE. ONE ESTIMATE IS THE PRICE DROP  WILL OVERTAKE THE 30 PERCENT TARIFF IN 18 MOTHS OR LESS, SO THE  EFFECT OF THE TARIFF IS UNLIKELY TO BE LONG-LASTING. IT REMAINS TO BE  SEEN HOW THE RETAIL PRICE OF WASHING MACHINES IS AFFECTED. MY  GUESS IS DOMESTIC MANUFACTURERS WILL CONSIDER THIS AN  OPPORTUNITY TO RAISE THEIR OWN PRICES AND PROFITS OR THEY COULD TRY  TO BUY MARKET SHARE BY KEEPING PRICES SLIGHTLY LOWER. THE STEEL AND ALUMINUM TARIFFS MAY BE MORE JUSTIFIABLE, BUT ARE  HOT BUTTON FOR THE CHINESE GOVERNMENT. REMEMBER, CHINA HAS  MORE EXCESS STEEL CAPACITY THAN THE REST OF THE WORLD HAS  CAPACITY. WITH PRESSURE LIKE THIS, RETALIATION IS NOT OUT OF THE  QUESTION. CHINESE LEADERS HAVE HINTED THAT SOYBEANS WOULD BE  A TARGET, BUT LIKE ALL COMMODITIES, HOW THIS WOULD AFFECT GLOBAL  PRICE IS UNCERTAIN IF THEY DON'T ACTUALLY DECREASE THE AMOUNT THEY  BUY. WHILE THE MARKET UNCERTAINTY THESE ACTIONS CAUSE MAY BE  NOTICEABLE AFTER EVERY NEW ANNOUNCEMENT, IT IS LONG-RANGE PLANS  BEING REWRITTEN THAT WILL IMPACT OUR FARMS MOST. TRADE  BELLIGERENCE DIMINISHES OUR FUTURE. THANKS, JOHN. SPEAKING OF TRADE, CATTLE  PRODUCERS ARE WORRIED ABOUT THEIR FUTURE.  THAT'S AS THE HERD SIZE GROWS, AND FUTURE TRADE  WITH KEY TRADING PARTNERS COULD BE HEADING  TOWARD ROUGH WATERS. WE'LL HAVE THAT STORY  AFTER THE BREAK.

HEADLINES
WELCOME BACK TO U-S FARM REPORT THIS FEBRUARY  WEEKEND. WE HAVE MUCH MORE AHEAD.  IT'S SUPPLY VERSUS DEMAND FOR THE CATTLE  INDUSTRY IN 2018.  MIKE GIVES US OUR FIRST GLIMPSE AT PLANTING  CONDITIONS IN HIS 90-DAY FORECAST THIS WEEKEND. WE'LL MEET THE 2018 HORIZON AWARD WINNER AND  HER STORY OF PASSION AND PERSERVERANCE.  PLUS, IT'S A TAX LESSON WITH JOHN PHIPPS. AND WE'RE  REVISITING THE PREVIOUS LESSON ON CHARITABLE  GIVING. 

STATE OF THE UNION
NOW FOR THE HEADLINES, PRESIDENT DONALD  TRUMP'S FIRST STATE OF THE UNION ADDRESS DIDN'T  MENTION AGRICULTURE, BUT IN A SPEECH MANY SAY  SIGNALED HOPE AND CELEBRATED ECONOMIC  GROWTH, THE PRESIDENT HITTING ON KEY ISSUES FOR  U-S AGRICULTURE, INCLUDING INFRASTRUCUTRE, TAX  REFORM AND IMMIGRATION.  <MY DUTY AND THE SACRED DUTY OF EVERY ELECTED OFFICIAL IN THIS  CHAMBER IS TO DEFEND AMERICANS. TO PROTECT THEIR SAFETY AND THEI  RCOMMUNITIES AND THEIR RIGHT TO THE AMERICAN DREAM BECAUSE  AMERICANS ARE DREAMERS TOO> AFTER THE SPEECH, MANY AGRICULTURE GROUPS APPLAUDING THE PRESIDENT, BUT CALLING CALLING  FOR UNITY AND FOLLOW-THROUGH ON BIG TICKET  ITEMS INCLUDING IMMIGRATION REFORM,  INFRASTRUCTURE AND TRADE.  AMERICAN FARM BUREAU FEDERATION PRESIDENT  ZIPPY DUVALL SAID THE ROADMAP OUTLINED BY THE  PRESIDENT CONTINUES THE THEME OF "RENEWING  RURAL AMERICA."  MEANWHILE, NATIONAL FARMERS UNION URGING  PRESIDENT TRUMP TO FOLLOW-THROUGH ON HIS  PROMISES SPECIFIC TO RURAL AMERICA...INCLUDING  INFRASTRCUTURE. THE PRESIDENT ALSO HIGHLIGHTING THE MASSIVE TAX  OVERHAUL PLAN PASSED BY CONGRESS JUST BEFORE  YEAR'S END.  WHILE THE NEW TAX LAW HAS BEEN GOOD FOR MAJOR  U-S CORPORATIONS, FARM CPA PAUL NEIFFER SAYS   IT'S HAVING NEGATIVE IMPLICATIONS FOR SOME  FARMERS.  <THE ISSUE WITH MOST OF OUR FARM CORPORATIONS OUT THERE THEY  WERE CREATED TO TAKE ADVANTAGE OF THE FIRST 50,000 OF A  CORPORATION BE TAXED 15 PERCENT. THE NEW CORPORATE TAX RATE IS A  FLAT 21 PERCENT, SO THOSE FARMERS ARE FACINGA A 40 PERCENT TAX  INCREASE.> NEIFFER SUGGESTS FARM FAMILIES SITTING DOWN  WITH THEIR TAX ADVISOR TO WEIGH OPTIONS,  INCLUDING THE POSSIBILITY FROM SWITCHING FROM A C CORPORATION TO A S CORPORATION 

WOTUS DELAYED
THE WATERS OF THE U-S RULE IS OFFICIALLY BEING  DELAYED FOR TWO YEARS. TEH EPA AND ARMY CORPS OF ENGINEERS PUSHING IT  BACK TWO YEARS, WHICH ALLWOS THE CURRENT  ADMINSTRATION TIME TO WRITE AND IMPLEMENT A  REPLACEMENT.  DURING A SENATE AG COMMITTEE HEARING THIS WEEK,  EPA ADMINSTRATOR SCOTT PRUIT SAYS THE AGENCIES  PLAN TO PROPOSE A NEW RULE YET THIS YEAR, WITH  HOPES TO FINALIZE THE RULE BY THE END OF 2018. 

CALIFORNIA SMOG
THE NEGATIVE AG TALK IN CALIFORNIA IS GAINING  MOMENTUM WITH A NEW REPORT. NOW RESEARCHERS ARE BLAMING FERTILIZER ON FARM  FIELDS FOR THE SMOG ISSUE IN CALIFONRIA.  A NEW STUDY FROM U-C DAVIS SAYS FERTILIZER IN  FARM SOILS CONTIRBUTES TO 25 TO 41 PERCENT OF  NITROGEN OXIDE EMISSIONS IN THE STATE.  IT'S KEY TO NTOE THAT SOILS NATURALLY EMIT  NITROGEN OXIDE. BUT THE RESEARCHERS SAY THE  EMISSIONS ARE MUCH HGIHER IN FERTILZIED  CROPLAND.

WEATHER
THAT'S IT FOR NEWS...METEOROLOGIST MIKE  HOFFMAN JOINS US AGAIN FOR A LONGER RANGE LOOK  AT WEATHER. MIKE, THIS WEEK I SAW A LOT OF  CHATTER ABOUT DRYNESS HEADING INTO SPRING.   < YEAH TYNE AS YOU'LL SEE IN MY 90 DAY OUTLOOK NOT EXACTLY LOOKING FOR AN IMPROVEMENT IN THE AREAS THAT ARE GETTING REALLY DRY BUT HERE WE GO. HERE'S THE JET STREAM YOU CAN SEE WE HAVE GONE BACK TO THE PATTERN THAT WE SAW EARLIER IN THE WINTER. IT'S COLD IN EAST WARM IN THE WEST. YOU HAVE THE BIG RIDGE OUT WEST THAT'S GOING TO KEEP IT WARM YOU HAVE THE COLD STUFF COMING IN SEVERAL WAVES OVER THE NEXT WEEK OR TWO. IN FACT THE COLDEST AIR MAY VERY WELL COME RIGHT. THERE IS THE TROUGH DIGS ALL THE WAY DOWN INTO THE TENNESSEE VALLEY BY NEXT WEEKEND. FEBRUARY TEMPERATURES PRETTY CONFIDENT ON THIS BELOW NORMAL. MOST OF THE EAST EXCEPT THE SOUTHEAST ABOVE NORMAL IN THE SOUTHWEST AND WEST MARCH TEMPERATURES MORE OF THE SAME EXPANDING THAT BELOW NORMAL AREA INTO THE NORTHWEST TAKING IT A LITTLE BIT FARTHER NORTH IN THE EAST AND STILL ABOVE NORMAL SOUTHWEST AND THEN WE'LL TAKE THE BELOW NORMAL INTO THE NORTHERN PLAINS BY MARCH MOST OF THE SOUTHLAND ABOVE NORMAL BY THEN. HERE'S THE 90 DAY PRECIPITATION OUTLOOK AND GOING BELOW NORMAL IN THOSE BAD DROUGHT AREAS THAT ARE DEVELOPING IN THE SOUTHWEST PLAINS INTO THE SOUTHWEST AND SOUTHEAST ONLY ABOVE NORMAL AIR EXPECTED IN THE PACIFIC NORTHWEST NORTHERN ROCKIES TIME. >THANKS, MIKE.

FARM JOURNAL REPORT
CATTLE PRODUCERS ACROSS THE  COUNTRY GATHERED THIS WEEK IN PHOENIX, ARIZONA  FOR THE NATIONAL CATTLEMAN'S BEEF ASSOCIATION  ANNUAL MEETING. MOODS WERE POSITIVE, AS  PRODUCERS FINISHED OUT 2017 WITH MODEST  PROFITS. BUT IT'S WHAT'S IN STORE FOR 2018 THAT HAS  SOME IN THE INDUSTRY WORRIED, AS ROUGH WATERS  WITH TRADE COULD EAT INTO POSSIBLE PROFITS IN THE  NEW YEAR.  CATTLE RANCHERS ACROSS THE COUNTRY HAVE  TURNED THE PAGE ON A PROSPEROUS YEAR.  USDA SAYS NET FARM INCOME IN 2017 CLIMBED  SLIGHTLY INTO THE GREEN.. <CERTAINLY THE INCREASE IS MROE RELATED TO THE PROTEIN SECTORS  WHERE A LOW COST OF FEED HAS HELPED THE BOTTOML LIEN AS WELL AS  GOOD EMAND. > AS ECONOMISTS REFLECT BACK ON 2017, IT'S BALANCE  THAT CARRIED THE BEEF SECTOR.  < AS WE LOOK AT CATTLE FEEDING WE ACTUALLY SAW A VERY GOOD  PROFITABLE LEVEL FOR CATTLE FEEDING ESPECIALLY WHEN WE GOT BACK  AND LOOK AT 16, WE DIDNT' EXPECT 17 FINISHED CATTLE TO PRICES TO BE  SO HIGH, AND WHAT THAT MENAT IS THEY BOUGHT THOSE CALVES LATE 16  AND EARLY 17 AT PRICES LEVELS THEY COULD ACTUALLY MAKE SOME  MONEY.> THE HERD GREW IN 2018, BUT STRONG DEMAND HELPED  CHEW THROUGH INCREASED SUPPLIES.  LOOKING AT 2018, USDA GIVING PRODUCERS THEIR  FIRST GLANCE AT COW NUMBERS IN THE LATEST  CATTLE INVENTORY REPORT RELEASED THIS WEEK.  AND IT SHOWED THE LARGEST U-S CATTLE HERD IN  NEARLY A DECADE.  <I THINK IT'S A FAVORABLE OUTLOOK FROM THE CONCERN OF THE GROWTH  WE MIGHT BE HAVING, IT'S MUCH MORE METERED> USDA SAYS WHILE THE TOTAL U-S HRD GREW 1  PERCENT COMPARED TO A YEAR AGO, THE GROWTH IS  HAPPENING AT A SLOWER PACE THAN LAST YEAR.  AND LOOKING AT JUST BEEF COWS, USDA SAYS THOSE  NUMBERS ARE UP 2 PERCENT FROM A YEAR AGO, AT 31  POINT 7 MILLION HEAD.  <WE'RE      STILL ON THE COW NUMBERS, 31.7, WE'RE STILL LOOKIN GFOR  GROWTH THROUGH 18 PROBABLY INTO 19 BEFORE WE SEE COW NUMBERS,  PEAK. I THINK THAT KIND OF EASES THE TENSION AND PUTS US ON TRACK TO  WHERE WE SHOULD BE.> IT'S NOT JUST AN EXPANDING CATTLE HERD THAT'S  CAUSING PROTEIN SUPPLIES TO GROW. PORK AND  POULTRY NUMBERS ARE ALSO ON THE RISE.  <GIVEN THE CONCERNS THAT THE INDUSTRY HAS HAD WITH NOT ONLY TEH  SUPPLY OF BEEF THAT WE HAD TO DEAL WITH IN 2018 BUT THE QUANITY OF  COMPETITIVE PROTEINS, I THINK THAT'S PUT US IN A MUCH MORE  COMFROTABLE VEIW THAT WE WILL HAVE LARGE SUPPLIES, BUT  MANAGEABLE SUPPLIES THROUGH THE SECOND HALF OF THE YEAR. > A FORECAST FOR A MORE TEMPERED GROWTH IN BEEF,  BUT THE REALITY IS SUPPLIES JUST KEEP GETTING  BIGGER.  <WE KNOW SUPPLIES ARE GROWING SO THAT PUTS MORE PRESSURE  ONM TEH DEMAND SIDE OF THE EQUATION> PURDUE ECONOMIST CHRIS HURT SAYS LAST YEAR WAS  A STRONG YEAR FOR BEEF BUYS ABROAD.  <WE WERE UP ABOUT 12 PERCENT ON VOLUME OF BEEF  EXPORTED IN 2018 USDA IS LOOKING FOR A 4 PERCENT  FURTHER EXPANSION IN EXPORTS ANDT HAT'S GOING  TO HAVE 11 PERCENT OF ALL OF OUR PRODUCTION OF  BEEF IN THE UNITED STATES IS BEING CONSUMED BY  OUR GOOD CONSUMERS IN FOREIGN COUNTRIES> BUT AS 2018 KICKS OFF, IT'S THE FUTURE OF TRADE  THAT REMAINS UNCLEAR.  NATIONAL CATTLEMEN'S BEEF ASSOCIATION REMAINS  OPTIMISTIC ABOUT THE OUTCOME, BUT THE REALITY IS  ANY SHAKEUP IN TRADE COULD HAVE MAJOR  REPRCUSSIONS FOR U-S CATTLE PRODUCERS.  <NOW WHEN YOU LOOK AT THE CURRENT DESTINATIONS FOR U.S. BEEF  HIGHLY CONCENTRATED IN THE TOP FIVE MARKETS SO CANADA MEXICO JAPAN SOUTH KOREA AND CURRENTLY HONG KONG. CHINA REPRESENTS  THE GREATEST OPPORTUNITY FOR GROWTH DEFINITELY. BUT THERE ARE  SOME TRADE BARRIERS TO ACCESSING MORE VOLUME TO THAT MARKET.> IN 2017, THE U-S CATTLE INDUSTRY GAINING ACCESS TO  CHINA FOR HTE FIRST TIME SINCE 2003. BUT IT'S  BREAKING INTO THAT MARKET THAT'S BEEN SLOW.   BUT WHAT WE'RE DOING RIGHT NOW IS FOCUSING ON TRYING TO  BUILD THE OVERALL DEMAND IN CHINA. KNOWING THAT HAVING NOT  BEEN THERE IN OVER 13 YEARS IS GOING TO TAKE A WHILE TO TRY TO  REGAIN THE CONSUMER'S CONFIDENCE AND MAKE SURE THAT WE CAN  REALLY TRY TO BUILD THAT MARKET.  <"IF YOU LOOK AT THE MONTH OF NOVERMBER CHINA WAS ACTUALLY THE  NUMBER 10 EXPORT MARKET. THAT'S ONE WAY TO LOOK AT IT. THE  REALITY IS CHINA WAS ABOUT 1/10 OF 1 PERCENT OF OUR TOTAL EXPORTS,  JUST AHEAD OF THE AMOUNT WE SENT OT THE PHILLIPINES"> IT'S ADDITONAL TRADE DEALS NCBA HOPES  COME TO  FRUITION.  < WE WOULD LOVE TO BE ABLE TO HAVE A BILATERAL TRADE  AGREEMENT WITH JAPAN BECAUSE THE 38 AND A HALF PERCENT TARIFF IS  STILL KILLING US RIGHT NOW JAPAN IS OUR NUMBER ONE EXPORT MARKET IT  WAS IN 2017 WITH AT 38 AND A HALF PERCENT TAX MEANS THAT A LOT OF  THAT MONEY IS GOING INTO THE POCKETS OF THE GOVERNMENT NOT INTO  OUR POCKETS AS PRODUCERS. > EVEN WITH TRADE AS A WILD CARE, A WEAKER U-S  DOLLAR IS ADDING TO  HOPES OF GROWING EXPORTS  IN 2018  FOR AN INDUSTRY HOPING 2018 WILL BE AS  FRUITFUL AS THE LAST.  DROUGHT IN THE PLAINS IS EATING INTO GRAZING  CONDITIONS. BUT PEEL TOLD US IT'S NOT SEVERE  ENOUGH YET THAT IT'S CAUSING MAJOR CONCERNS  FOR LIQUIDATION THIS YEAR.  UP NEXT, JOHN PHIPPS.

CUSTOMER SUPPORT
WE'VE TALKED ON THE SHOW ABOUT TAX IMPLICATIONS  FOR FARMERS ADN RANCHERS UNDER THE NEW TAX  CODE. BUT WHAT IMPACT COULD IT HAVE ON  CHARITABLE GIVING? HERE'S JOHN PHIPPS.  MY COMMENTS ABOUT THE CHANGES IN THE CHARITABLE GIVING  DEDUCTION PROMPTED THIS RESPONSE FROM ROGER OUSNAMER IN  HOLT, MI. "THE NUMBER OF TAX PAYERS THAT DO NOT FILE THE SCHEDULE A IS  AROUND 70% IF NOT A BIT HIGHER. THIS WOULD LEAD ME TO BELIEVE THAT MOST PEOPLE DONATE BECAUSE  THEY WANT TO. AS OF LAST YEAR AND PRIOR YEARS BY USING SCHEDULE  A CHARITABLE DEDUCTION PUTS PEOPLE IN THE FRAME OF MIND THAT  THEY NEED THE GOVERNMENT TO BE INVOLVED IN THIS DECISION OF TAX  PAYERS. I SEE THE NEW TAX PLAN AS A GOOD OVERALL DECISION. AS FOR  CHARITABLE GIVING IT SHOULD BE UP TO INDIVIDUALS TO GIVE ESPECIALLY  LOCALLY AND WITHIN THEIR STATE WHAT THEY CAN AFFORD AND ARE  COMFORTABLE WITH GIVING. KEEP THE GOVERNMENT OUT OF IT." THANKS FOR WRITING, ROGER. I DON'T DISAGREE WITH YOUR PHILOSOPHY  OF GIVING AND TAXES, BUT I DO THINK IT SHOULD BE APPLIED EQUALLY.  AS I STATED, THAT 30% OF SCHEDULE A FILERS IS EXPECTED TO SHRINK  TO 5%. IT IS THIS GROUP, MIDDLE INCOME TAXPAYERS, THAT HAS  CHARITIES LIKE UNITED WAY AND BOY SCOUTS OF AMERICA CONCERNED  ABOUT LOWER GIVING. MEANWHILE, HOWEVER, WEALTHY GIVERS STILL  RECEIVE THE FULL BENEFIT OF TAX DEDUCTIBILITY. THE TAX BILL DID NOT GET  THE GOVERNMENT OUT OF CHARITABLE GIVING. IT SKEWED THE SYSTEM  EVEN MORE TOWARD HIGH INCOME EARNERS. MORE THAN 80% OF THE  TAX BREAKS GO TO THOSE WEALTHY AMERICANS, SO I SUPPOSE IT IS  CONSISTENT THAT THE TAX DEDUCTIONS SHOULD AS WELL. I WOULD  SUPPORT ELIMINATING THE CHARITABLE DEDUCTION ENTIRELY, BUT THAT IS  NOT WHAT THIS LEGISLATION DOES. I WILL REVISIT THIS TOPIC WHEN WE HAVE SOME ACTUAL NUMBERS TO  ANALYZE. THANKS, JOHN. IF YOU HAVE QUESTIONS OR COMMENTS  FOR JOHN, EMAIL HIM AT MAILBAG AT U-S FARM REPORT  DOT COM.

TEASE
WE NEED TO TAKE A QUICK BREAK, BUT WHEN WE COME  BACK, WE'LL PROVIDE YOU SOME MOTIVATION THIS  WEEKEND BY INTRODUCING YOU TO A YOUNG WOMAN  WHO'S PROOF THAT WHERE THERE'S A WILL, THERE'S A  WAY. 

TOP PRODUCER HORIZON WINNER
LAST WEEK DURING THE TOP PRODUCER SEMINIAR, WE  HAD THE CHANCE TO MEET THIS YEAR'S TOP PRODUCER  OF THE YEAR WINNER. BUT TOP PRODUCER MAGAZINE  ALSO HONORS AN UP AND COMING INDIVIDUAL IN THE  INDUSTRY, AS THE HORIZON AWARD WINNER.  THIS YEAR'S RECIPIENT IS PROOF THAT NO MATTER THE  FARM SIZE, WITH ENOUGH WILL AND DETERMINATION,  THE IMPOSSIBLE CAN BECOME A REALITY.  LIFE ISN'T SLOWING DOWN FOR MAGGIE HOLUB OF SCRIBNER NEBRASKA.   MY TYPICAL DAY. THERE IS NO TYPICAL DAY  FROM FARMING AND HAULING GRAIN, TO WORKING AS A  CREDIT ANALYST AT FARM CREDIT SERVICES OF  AMERICA, TO TEACHING WORKOUT CLASSES AT HER  LOCAL YMCA  I FELL IN LOVE WITH GROUP FITNESS.   FULL DAYS AND THE STEPS OF A LIFE UNEXPECTED    SO I HAVE NO BROTHERS. IT WAS ALWAYS I WANTED TO BE INVOLVED  AND I WAS ALWAYS INVOLVED SO I USED MY VACATION TIME TO GO  HOME AND HELP FARM   SHE GRADUATED COLLEGE, GOT A GOOD JOB AND  BEGAN LIVING…   TWO YEARS INTO MY CAREER MY DAD GOT DIAGNOSED WITH CANCER  AND IT TOTALLY CHANGED EVERYTHING.  HE PASSED IN OCTOBER OF 2014—AN EMPTY SPACE  SHE FILLED WITH HIS PASSION.   MY MOM PRESENTED THE OPPORTUNITY FOR I HAVE ONE OTHER SISTER--  SO HER HUSBAND A FARM HALF OF THE ACRES AND THEN I FARM THE  OTHER HALF OF THE FAMILY GROUND.     280 ACRES OF CORN AND SOYBEANS, HALF OF HER  FATHER'S EQUIPMENT AND ALL OF HIS ENTHUSIASM.   I WAS TOTALLY SCARED BUT I WAS ALSO REALLY EXCITED AT THE SAME TIME.   BUT DOING THE WORK YOURSELF IS DIFFERENT THAN  JUST HELPING.   IT WAS MY GOAL TO JUST GET A CROP IN AND GET A CROP OUT AND  PROVE TO MYSELF AND EVERYONE ELSE THAT I CAN FARM.  IT TURNS OUT…SHE CAN…YIELDING BETTER THAN 220  BUSHEL CORN AND 70 BUSHEL BEANS.   AND SHE'S  ADDED GROUND AND A NEW TO HER COMBINE-- IN THE 3  YEARS SINCE SHE STARTED.   I WOULD LIKE A DIVERSE DIVERSIFY MY OPERATION EVEN FURTHER AND I  WANT TO BUILD A HOG BUILDING AND I WANT TO BRING HOG PRODUCTION  BACK ONTO OUR FARM.   LUCKILY HER PROFESSIONAL EXPERIENCE IS HELPING  HER MANAGE CASH FLOWS   I ALSO KNOW MY BREAKEVENS. I HAVE A SOLID MARKETING PLAN SET  UP AND I PULL THE TRIGGER WHEN I NEED TO PULL THE TRIGGER  AND THE ON-FARM EXPENSES.  I'VE LEARNED REAL QUICK HOW MUCH IT TAKES TO OVERHAUL THE TRACTOR  AND THE COST OF THAT TOO.  IT DOESN'T PENCIL OUT.  WORK SHE NOW DOES MUCH OF THE WORK HERSELF  ALTHOUGH CONVINCING HERSELF SHE CAN—ISN'T  ALWAYS THE HARDEST PART.  SO WHEN YOU GO TO THE PARTS COUNTER AND SAY I NEED OIL FILTERS  FOR MY TWO 4640 AND I NEED A CLEAN GRAIN ELEVATOR CHAIN. AND  THEY LOOK AT YOU LIKE WHAT ARE YOU GOING TO DO WITH THIS? WELL,  I'M GOING TO GO PUT IT IN. I'M GOING TO CHANGE MY OIL.  JUST LIKE SHE LEARNED TO DRIVE A 13 SPEED SEMI.  AND HER MOTHER—WHO HELPED GIVE MAGGIE THIS  OPPORTUNITY -- HAS BEEN WITH HER ON EVERY STEP.   NO SHE'S BEEN ACTIVELY INVOLVED ON THE FARM SINCE I WAS BORN  BEFORE I WAS BORN. YEAH, SHE'S MY GRAND CART DRIVER. SHE'S MY  CHEERLEADER.  ENCOURAGING HER TO BUILD A FUTURE. MAGGIE  HOPES TO ADD MORE ACREAGE AND TECHNOLOGY TO  THE OPERATION OVER TIME.   I JUST WANT TO KEEP MY OPERATION IN THE FAMILY. I DON'T WANT TO BE  THE ONE THAT HAS TO SELL THE FARM BECAUSE WE CAN'T MAKE IT.   AND SHE'S MOVING AS FAST AS SHE CAN TO MAKE  SURE THAT DOESN'T HAPPEN.  EVEN AS SUCCESS COMES, DON'T EXPECT THIS 4TH  GENERATION FARMER TO QUIT HER DAY JOBS ANYTIME  SOON.   LIKE I LOVE IT HERE TOO. THAT'S THE STRUGGLE I HAVE. I MEAN IT'S  REAL. IT'S A REAL STRUGGLE.  BECAUSE FOR HER—FAMILY IN ALL THREE PARTS OF  HER LIFE ARE WORTH THE WORK.  AND I PRIDE MYSELF FOR GETTING ALL OF THAT DONE. I'LL GO FOR A RUN AT  5 A.M. OR I'LL GO WORK OUT AT THE GYM OR I'LL GO. HAUL CORN AND THEN  COME TO THE OFFICE. IT'S CRAZY TO THINK HOW MUCH YOU CAN GET  DONE IN ONE DAY.  AND HOW MUCH YOU CAN ACCOMPLISH WHEN LIFE  HANDS YOU THE UNEXPECTED.   THANK YOU CLINTON. AND CONGRATULATIONS MAGGIE.  WHAT AN INSPIRING STORY AND I CAN'T WAIT TO SEE  WHERE YOUR JOURNEY TAKES YOU NEXXT. 

TEASE
WHEN WE COME BACK, TRACTOR TALES. PLEASE STAY  WITH US.

TRACTOR TALES
WELCOME BACK TO TRACTOR TALES FOLKS!  THIS WEEK WE'VE GOT A CLASSIC 1964 JOHN DEERE WORKING THE FIELDS IN CENTRAL INDIANA.   JEFF LANOUE PURCHASED THIS 4020 TO DO A LITTLE DISKING AND  PLOWING ON HIS FARM IN ILLINOIS.  TODAY HE'S WORKING THE FIELD WITH  A JOHN DEERE 145 PLOW 1964 JOHN DEERE 40 20. WE JUST PLAY WITH IT PULL SOME WITH IT AND  I LOVED GOING TO PLOW DAYS I FARM A LITTLE, YEAH. WE DISK AND PLOW  AND YOU GET THE GROUND READY. IT WAS A LOT LIKE YOU SEE IT NOW  PLAYED WITH THE MOTOR A LITTLE BIT AND SOME TIRES AND CLEANED IT  UP. THEY'RE HAVING A PLOW DAY TODAY AND DECIDED TO COME DOWN  AND. HELP THE GUY OUT. IT PULLS KIND OF HARD BUT ONCE YOU GET THE  PLOW ON THE GROUND IT DOES PRETTY GOOD JOB. WHEN I'M GONE. MY  DOG GOT TWO SONS AND. THEY'LL TAKE IT AND. KEEP PLAYING WITH IT.  WE DO PARADES WE DO PLOW DAYS. A FEW TRACTOR RIDES. I'D RATHER  GO TO A PLOW DAY THAN THAN ANY OF THEM. BUT WHY'S THAT I DON'T  KNOW YOU SEE. YOU MEET SO MANY PEOPLE FROM ALL OVER. THERE'S  A GUY HERE FROM FROM OHIO. YOU KNOW I WOULD NEVER. NEVER  MEET SOMEBODY LIKE THAT. THEY'RE JUST SO SMOOTH SO EASY YOU  KNOW TO RUN. THEY'RE COMFORTABLE. NOT COMPARED TO TODAY'S. BUT  BACK IN 64 THAT WAS THAT WAS A REALLY NICE TRACTOR. THANKS, SO MUCH,

TEASE
STAY WITH US, WE HAVE SOME MORE VIEWER PHOTOS INCLUDING HONORING A FIREFIGHTER TO SHARE WITH YOU NEXT. 

FROM THE FARM
WELCOME BACK. TIME TO CLOSE OUT THE SHOW WITH  SOME VIEWER PHOTOS.  WE WANT TO CONGRATULATE OR FEBRUARY FACEBOOK  COVER PHOTO WINNER, AMBER STERN-ITZ-KEY. SHE  LIVES IN GOOD THUNDER MINNESOTA AND SUMBITTED  THIS PHOTO. SHE SAYS THAT'S HER FAVORITE PLACE TO  CAPTURE PHOTOS THIS TIME OF YEAR.  AND IF YOU'RE ON TWITTER, YOU MAY WANT TO GIVE  THIS GUY A FOLLOW. SECRETARY SONNY PERDUE IS  PRETTY ACTIVE ON TWITTER. BUT THIS WEEK HE  SHARED A PICTURE OF HIM HONORING USDA FOREST  SERVICE FIREFIGHTER DAVID DAHLBERG. DURING THE  CALIFORNIA WILDFIRE THIS JULY, THE SECRETARY SAID  DAVID SAVED THE LIVES OF 62 CHILDREN AND STAFF AT  A CAMP NEAR SANTA BARBARA.  SO THE SECRETARY HONORED DAVID THIS WEEK, BUT  TO CAP OFF THE NIGHT, HE WAS INVITED BY TEH  PRESUDED TO WATCH TEH STATE OF THE UNION  ADDRESS, SITTING NEAR THE FIRST LADY.AND JUST IN TIME FOR THE BIG SUPER BOWL WEEKEND,  MIKE, THE NATIONAL CHICKEN COUNCIL PROJECTS  CHICKEN WING CONSUMPTION DURING THE GAME TO  JUMP TO 1 PONT 35 BILLION POUNDS. THAT WOULD BE A  NEW ALL TIME HIGH AND BEAT LAST YEAR'S  CONSUMPTION BY 20 MILLION WINGS.  WOW WHAT A SEAT THIS WEEK. AND WHAT A STORY. WELL JUST IN  TIME FOR THE BIG SUPER BOWL WEEKEND THE NATIONAL CHICKEN  COUNCIL REJECT CHICKEN WING CONSUMPTION DURING THE GAME TO  JUMP TO ONE POINT. OH MY GOODNESS. FIVE BILLION POUNDS BILLION  WITH A B. THAT WOULD BE A NEW ALL TIME HIGH AND BEAT LAST YEAR'S  CONSUMPTION BY 20 MILLION. CHICKEN WINGS I MEAN WE'RE TALKING  ABOUT BILLION. WE'RE TALKING ABOUT MILLIONS. THAT'S A LOT OF  CHICKEN. THEY KNOW THAT. I DON'T KNOW.   ALL I KNOW IS OUR POULTRY PRODUCERS THAT ARE WATCHING ARE  THINKING BECAUSE WE'VE INCREASED IT AND SO INCREASE THAT  DEMAND. THAT'S GOOD NEWS NO DOUBT THOSE WINGS DO LOOK GOOD.  ALL RIGHT IF YOU HAVE A PICTURE A VIDEO YOU WOULD LIKE TO SEND.  YOU CAN DO THAT TO THE ADDRESS ON THE SCREEN.

CLOSE
AND FROM ALL OF US  THE U.S. FARM REPORT THAT MIKE HOFFMAN AND SAM MORGAN THANK  YOU FOR WATCHING US THIS WEEKEND. BE SURE TO JOIN US RIGHT HERE  NEXT WEEK AS WE WORK TO BUILD ON OUR TRADITION. HAVE A GREAT  WEEKEND EVERYONE.   

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