USFR Weekly Recap - July 29-30, 2017

July 29, 2017 03:30 AM
 

TODAY ON U.S. FARM REPORT
JULY 29-30, 2017


HEADLINES
WELCOME TO U.S. FARM REPORT. I'M TYNE MORGAN,  AND HERE'S WHAT WE'RE WORKING ON FOR YOU OVER  THE NEXT 60 MINUTES.  CROP CONDITIONS CONTINUE TO FADE. BUT IS IT  ENOUGH TO MOVE THE MARKETS?  DEVESTATING DROUGHT DEEPENS THE PAIN IN THE  NORTHERN PLAINS, EATING INTO THE HAY SUPPLY.  <   "SOME OF IT'S A BALE AN ACRE,  SOME OF IT'S A LITTLE MORE, OR IT'S  LESS, IT'S  NOT REAL GOOD."> AND THESE FARMERS ARE RESORTING TO DRASTIC  MEASURES TO COPE.  HE'S A FRESH FACE ON THE FARM, BUT HE BLEEDS  TRADITION...  <"IT'S IN OUR BLOOD. WE CAN'T GET RID OF IT. IT'S JUST SOMETHING WE  REALLY REALLY ENJOY,"> WE'LL INTRODUCE YOU TOMORROW'S TOP PRODUCER  OF THE YEAR. AND IN JOHN'S WORLD... <MICROSOFT AND RURAL BROADBAND><U.S. FARM REPORT - BROUGHT TO YOU BY THE DEPENDABLE, LONG  LASTING, CHEVY SILVERADO.>

JAPAN INCREASES U.S. BEEF TARIFFS
NOW FOR THE MARKET RELATED NEWS, A FAILED  TRANS PACIFIC PARNTERSHIP IS COMING AT A COST--  THIS TIME, IT'S MEAT EXPORTS TO THE UNITED STATES'  NUMBER ONE CUSTOMER. AND THE U-S MEAT INDUSTRY  RECEIVING VERY SHORT NOTICE OF HTE MOVE.  JAPAN ANNOUNCING FRIDAY IT'S RAISING THE TARIFFS  ON FROZEN BEEF FROM 38 PONT 5 PERCENT TO 50  PERCENT ON AUGUST 1ST.   IT'S NOT JUST THE U-S SEEING A RATE HIKE... AND  JAPAN SAYS THE ACTION IS TO PROTECT ITS OWN  PRODUCERS. BUT IT DOESN'T GO UNNOTICED TAHT JUST LAST THIS  MONTH, JAPAN STRUCK A BILATERAL DEAL WITH THE  EU.  THIS IS THE FIRST RATE HIKE ON BEEF IN THE  COUNTRYSINCE 2003.  ACCORDING TO AGWEB, JAPAN WAS JUST APPROACHING PRE-BSE IMPORT LEVELS OF U-S BEEF,  WITH EXPORTS UP 30 PERCENT SO FAR THIS YEAR. LOOKING AT OVERALL CONDITIONS - WE SEE A TWO  POINT DROP FROM LAST WEEK. 62-PERCENT NOW GOOD  TO EXCELLENT. THE WESTERN CORNBELT IS THE BIG REASON BEHIND  THE DECLINE. IOWA IS DOWN THREE. NEBRASKA DOWN  FOUR POINTS. THERE'S A BIG DROP IN SOYBEAN CONDITION AS WELL.  JUST 57-PERCENT IS GOOD TO EXCELLENT DOWN FOUR  POINTS FROM LAST WEEK. ILLINOIS LEADS THE DECLINE. IT FELL EIGHT POINTS  THIS PAST WEEK WITH 59-PERCENT GOOD TO  EXCELLENT.  IN THE WEST NEBRASKA AND SOUTH DAKOTA BOTH  SEEING FOUR POINT DROPS.

CATTLE ON FEED NUMBERS
SO FAR DROUGHT AND DRYNESS HASN'T BEEN ENOUGH  TO STOP GROWTH ON AMERICAN RANCHES. THE MID-YEAR CATTLE INVENTORY NUMBERS ARE OUT  FROM USDA. IT SHOWS THE TOTAL HERD IS NOW 4 PERCENT BIGGER  THAN LAST SUMMER AT 103 MILLION HEAD.  THAT'S THE LARGEST HERD IN NEARLY A DECADE. BEEF COW NUMBERS ARE 7 PERCENT  HIGHER...ALTHOUGH REPLACEMENT HEIFER NUMBERS  ARE ACTUALLY DOWN COMPARED TO A YEAR AGO. ANALYSTS SAY THE NUMBERS SHOW BEEF COW HERD  EXPANSION IS LEVELING OFF. THE WORLD'S LARGEST RICE PRODUCER IS HUNGRY  FOR MORE RICE, AND IT'S LOOKING TO THE U-S.

CHINA IMPORTING U.S. RICE
CHINA ANNOUNCING IT WILL IMPORT AMERICAN RICE  FORE THE FIRST TIME. AG SECRETARY SONNY PERDUE SAYS IT'S A DEAL IN  THE WORKS FOR MORE THAN A DECADE. CHINA PRODUCES 20 TIMES MORE RICE THAN THE U-S. INTERNATIONAL DEMAND IS CHANGING THE GAME FOR  U-S HAY PRODUCTION. RABOBANK RELEASING A NEW REPORT, SHOWING U-S  ALFALFA AND OTHER HAY PRODUCERS ARE IN A GOOD  POSITION. THAT'S AS GLOBAL DEMAND FOR U-S HAY IS EASING THE  OVERSUPPLY PRODUCERS FACED IN 2015 AND 2016.  AND AS DEMAND CONTINUES TO CLIMB, RABOBANK  THINKS HAY PRICES WILL FIND FURTHER SUPPORT. BUT IT'S HAY PRODUCERS IN THE WEST CASHING IN ON  THE DEMAND BOOM FOR U-S HAY.  RABOBANKS SAYS SEVEN STATES IN THE WEST  PRODUCE 18 PERCEN TOF U-S HAY AND NEARLY 90  PERCENT OF U-S HAY EXPORTS, INCLUDING IDAHO.  DRISCOLL BROTHERS IN ABDERDEEN IDAHO SAYS THEY  PLANTED EXTRA ACRES OF WHEAT THIS YEAR, AS THEY  RECENTLY BECAME PARTNERS WITH A GROUP IN CHINA  TO EXPORT HAY THERE.  <IT'S KIND OF A MUTUAL DEAL. THEY WERE LOOKING FOR SOMETHING. WE  WERE LOOKING FOR SOMETHING BECAUSE THE WHEAT PRICE IS NOT UP TO  COST OF PRODUCTION, SO WE'RE TRYIGN TO LOOK FOR SOMETHING A LITTLE  BIT DIFFERNT AND THIS COME ALONG. AND IT LOOKED LIKE IT COULD WORK.  TRHERES'S A LOT OF PEOPLE IN CHIAN THAT ARE TRYING TO GET OUT OF THE LOWER CLASS INCOME AND OCME INTO THE MIDDLE CLASS. AND THEY'RE  TASTING MILK, MEAT AND PROTEINS.> DRISCOLL TOLD ME THEY HAVE 18 TRUCKLODS OF A  HAY A DAY THAT WILL GO INTO CONTAINERS AND HEAD  TO CHINA. IT TAKES 45 DAYS FOR THE CROP TO MAKE  THE TRIP. 

WEATHER
THOSE ARE THE HEADLINES...METEOROLOGIST MIKE  HOFFMAN JOINS US NOW WITH WEATHER. MIKE, IT WAS  ANOTHER WEEK OF SOME VIEWERS RECEIVING TOO  MUCH RAIN, WHILE OTHERS SAW TOO LITTLE. WELL GOOD MORNING TYNE YOU'RE ABSOLUTELY RIGHT AND THAT'S  TYPICALLY THE CASE THIS TIME OF THE YEAR OF COURSE THE REALLY DRY  AREAS CONTINUE TO BE THE FAR NORTHERN PLAINS. BUT IT'S GETTING DRY  EARTH IN PARTS OF THE CENTRAL PLAINS. LET'S GO BACK A MONTH TO SEE  WHAT THE DROUGHT MONITOR LOOKED LIKE YOU'D SEE STILL A FEW  LINGERING POCKETS OF DRYNESS IN THE SOUTHEAST. A LITTLE FARTHER  EASTWARD FROM THERE THERE ARE SOME POCKETS IN OKLAHOMA AND  TEXAS BUT GOING THROUGH THE LAST FOUR WEEKS OR SO YOU CAN SEE  HOW THINGS HAVE GOTTEN WORSE IN THE FAR NORTHERN PLAINS. MOST OF  THE DAKOTAS INTO EASTERN MONTANA AND IT'S GETTING WORSE IN  POCKETS THROUGHOUT THE CENTRAL PLAINS. LET'S GO DAY BY DAY THIS WEEK. VERY LITTLE GOING ON THIS. HIGH PRESSURE DOMINATING MOST OF  THE CORN BELT SO YOU'RE NOT GOING TO GET MUCH RAIN THERE. A LITTLE  BIT OF LINGERING SHOWER ACTIVITY IN THE FAR NORTHEAST AS WE END THE  MONTH OF JULY. SCATTERED THUNDERSTORMS ALONG THIS STATIONARY  FRONT FROM FLORIDA INTO THE SOUTHWEST. WEAK FRONT COMING INTO THE  NORTHERN PLAINS THAT WILL MOVE INTO THE NORTHERN GREAT LAKES BY  WEDNESDAY VERY SLOW MOVER OBVIOUSLY JUST SPOTTY SHOWERS AND  THUNDERSTORMS THERE. HIGH PRESSURE STILL DOMINATING MOST OF THE  EAST IN THE CORN BELT FROM FLORIDA TO THE SOUTHWEST MORE  THUNDERSTORMS AND WE STILL SEE MORE OF THE SAME BY FRIDAY.  THAT FIRST FRONT IS MOVING OFF THE NORTHEAST COAST SECOND WIND  COMING INTO THE CANADIAN BORDER AREA OF THE NORTHERN PLAINS  AND THE STATIONARY FRONT FROM FLORIDA DOWN INTO SOUTH TEXAS STILL  CAUSING SHOWERS AND THUNDERSTORMS THERE. SO THE HEAT  CONTINUES OUT WEST. NOT SO MUCH FARTHER EAST.   WE'LL HAVE YOUR LONGER RANGE FORECAST COMING UP IN OUR NEXT HALF  HOUR.

TEASE
THANKS, MIKE. HOW WILL DECLIDNING CROP CONDITONS IMPACT THE MARKET? BRIAN ROACH AND SUE MARTIN JOIN ME NEXT.

ROUNDTABLE 1
WELCOME BACK TO US FARM REPORT ON THE MARKETING ROUNDTABLE WITH ME THIS WEEKEND. BRIAN ROCHE AND SUE MARTIN WE STARTED OFF THE SHOW TALKING ABOUT CROP CONDITIONS. SO LET'S START OFF THE ROUND TABLE TALKING ABOUT CROP CONDITIONS. WE CONTINUE TO SEE THESE CROP CONDITIONS DECLINE EVERY WEEK. SO I KNOW IT'S EXPECTED THAT THAT CONDITIONS ARE GOING TO DECLINE. BUT IT IS A DECLINING. MORE SO THAN NORMAL. WELL YES IT IS. THESE CROP CONDITIONS I THINK WHAT'S BEING MISSED IS THE HEAT AT NIGHT THAT'S HELPING THAT CROP CONTINUE TO PUSH. AND OF COURSE WE'RE PUTTING THE CORN THROUGH YOU KNOW POLLINATION. WE'RE NOT TOTALLY FINISHED WITH THAT YET. AND YET THE MARKET SEEMS TO BE IN A LITTLE BIT OF DENIAL LOOKING AT IT. WE THINK CONDITIONS WILL DETERIORATE AGAIN HERE THIS NEXT WEEK. AND SO I THINK THAT WHEN WE LOOK AT THIS THE BEAN MARKET VERSUS THE CORN WE'RE NOW JUST ENTERING INTO BEING MONTH. BUT AGAIN EVEN THOUGH BEANS WEREN'T INTO FULL BLOWN REPRODUCTIVE STAGE IT BEANS OR SHORT ALMOST EVERYWHERE. AND AND YET IN OUR AREA I ALMOST THINK THINGS ARE LOOKING BETTER THAN THE CORN. IT'S JUST KIND OF YOU KNOW IT DEPENDS IT'S A POPCORN THUNDERSTORM SUMMER AND THOSE ARE NOT YOUR SUMMERS WHEN YOU REALLY GET THE GOOD YIELDS. AND I'LL ASK YOU ABOUT IOWA IN A SECOND. BUT YOU KNOW WE'RE SEEN AS A MAJOR PRODUCING STATES SEE DECLINE IN CROP CONDITIONS. I MEAN NOT JUST WHERE WE'RE SEEING THE DROUGHT. YOU KNOW ILLINOIS SEEING DECLINING CROP CONDITIONS. THAT HAS TO FUEL THE MARKET BUT IT'S NOT FUELING THE MARKET LIKE SOME PRODUCERS WANT AT THIS POINT. WELL AT THIS POINT YOU HAVE TO LOOK AT THE CROP RATINGS IS ONLY ONE INDICATOR OF WHAT'S REALLY GOING ON IN THE CROP. AND SO A DECLINING CROP RATING CHART DOESN'T REALLY MEAN THAT THE CROP IS GOING TO BE AWFUL JUST MEANS AVERAGE AT THIS POINT. AND SO THE THINGS THAT SUE IS TALKING ABOUT WE PROBABLY WON'T SEE THE REAL DATA THAT DRIVES A BULLISH OUTLOOK FOR QUITE A WHILE WE HAVE A REPORT ON THE 10TH OF AUGUST IT PROBABLY WON'T BE AS BORING AS EVERYBODY WANTS BUT AT THIS POINT WE'RE NOT TALKING ABOUT A CROP LIKE LAST YEAR WHERE WE'RE TALKING ABOUT AN AVERAGE CROP IN THE RATINGS AT THIS POINT SAY SOMETHING LIKE AN AVERAGE CROP UNTIL PROVEN UNTIL WE REALLY SEE THE DATA THAT CHANGES THAT. AND THAT'S WHY THE SPECS AREN'T INTERESTED IN TAKING ON NEW LONG POSITIONS. SO WE WE HAVE NOT GIVEN THE SPECS OR REAL REASON TO COVER SHORTS AND HAVE NEW LONGS AND TAKE US TO THE KIND OF PRICES THAT GROWERS ARE GOING TO REALLY WANT TO SELL. I WILL SAY THAT THE GROWERS HAVE BEEN GETTING THE RAINS THIS WEEK WHEN I DRIVE AROUND AND I LOOK AT THE KIND OF WEATHER WE HAVE LOW HUMIDITY TEMPERATURES IN THE 80S THOSE AREAS WILL BE DOING BETTER. WE HAVE NOT AREAS YOU KNOW THEY PROBABLY HOLD THEIR OWN IN THE CORN MARKET AND THE BEANS. YOU KNOW WHEN THEY DON'T GET RAIN BUT THEY DON'T ALSO HAVE THE HEAT. THEY PROBABLY GO INTO SOME SORT OF DORMANCY PHASE LOOKING FOR THE RAIN. AND SO FOR THE BEAN CROP TO DETERIORATE ANYMORE IN TERMS OF THOSE RATINGS WE NEED TO PROBABLY GO ANOTHER WEEK. WE HAVE A DRY FORECAST FOR THE NEXT COUPLE OF WEEKS THEN MAYBE SEE THE RATINGS CONTINUE TO DECELERATE ON THAT ON THE BEYOND CRAP WHICH THEN SHOULD PERK THE MARKET UP ON THE SIDE. SO A LOT OF FOCUS ON IOWA I MEAN THIS YEAR WE'RE TALKING IT'S THE HAVES AND THE HAVE NOTS RIGHT. WE'VE BEEN TALKING ABOUT THAT STORY. EVERYONE'S WATCHING OYSTER IN IOWA WHERE IT'S GETTING YOU KNOW WHO'S GETTING THE RAIN WHO'S NOT IN YOUR MIND HOW GOOD IS IOWAS CROP. I THINK IOWA'S CROP IS NOT THE STELLAR CROP THAT WE'VE GOTTEN A ACCUSTOMED TO THE WESTERN OR EASTERN THIRD. LOOKS VERY GOOD. IT'S EXCELLENT EXCEPT SOUTHEASTERN IOWA DOESN'T LOOK TOO GREAT. AND THEN YOU LOOK THROUGH THE MIDDLE OF THE STATE THE HEART OF THE STATE FROM BORDER TO BORDER AND IT'S IT'S COMING DOWN THE CROP JUST DOES NOT HAVE THAT DEEP GREEN COLOR THAT IT NORMALLY SHOULD HAVE AND BEANS COURSE THROUGH THE WHOLE STATE'S SMALL. IF YOU LOOK AT WESTERN IOWA COURSE IT'S EVEN MORE PRONOUNCED BECAUSE THESE ARE AREAS THAT ARE JUST VERY VERY DRY. YOU KNOW THE BEST CHANCE FOR RAIN WAS THIS PAST WEEK. AND YOU KNOW MAYBE SOME AREAS GOT AN INCH INCH AND A HALF BUT WHAT WAS FUNNY WAS AT WHL RADIO WHICH IS THE LARGEST RADIO STATION IN IOWA AND HAS A NICE BIG BROADBAND LISTING AREA AT 5:30 THAT MORNING ON WEDNESDAY SAID YOU KNOW CALLED OUT FOR FLOOD ALERTS THROUGH CENTRAL AND SOUTHERN IOWA. NOTHING. WE'VE GOT NOTHING. AND THAT'S JUST UNUSUAL. I JUST DON'T KNOW IF I CAN RECALL A TIME WHEN WE'VE HAD THAT RADAR. IT CAN FOOL YOU THAT YOU CAN BE IN THE AIR AND NOT MAKE IT THE GROUND. AND I THINK THAT WE'VE GOT SOME MAJOR STATES HERE SOUTH DAKOTA NEBRASKA IOWA A CHUNK OF MISSOURI AND THEN EVEN A PORTION OF OF ILLINOIS WHO DROPPED 8 PERCENT IN THE LAST RATINGS. THESE ARE MAJOR PRODUCING CORN STATES. MINNESOTA LOOKS PRETTY DECENT AND THEY DID GET SOME GRATIFICATION THIS PAST WEEK WITH RAIN AS WELL. SO I THINK THAT WE'RE LOOKING AT A SITUATION. BUT HERE'S ANOTHER KICKER THE WEATHER SOURCES WE USE ARE CALLING FOR A TURN IN THIS WEATHER AND IT'S ALL DEPENDENT ON THAT SOUTHWEST MONSOON IT IF IT CONTINUES TO GROW IT SHOULD DISLODGE THIS THIS RIDGE AND PUSH IT EASTWARD. THERE'S KIND OF A DOUBLE EDGE SWORD THERE ONE. THEN IT OPENS UP COOLER TEMPS SOME MOISTURE POTENTIAL FOR THE WESTERN CORN BELT. BUT THE EASTERN CORN BELT COULD THEN START TO SEE HEAT AND YOUR SHALLOW AT IT. SO IT'S KIND OF IT'S AN INTERESTING SUMMER AND WE WON'T KNOW TOTALLY HOW THAT ALL PLAYS OUT BUT IN ABOUT 10 DAYS THAT'S A SHIFT. ALL RIGHT SO SO MANY UNKNOWNS BUT HAVE WE PUT THE HIGH IN THIS MARKET. I'LL ASK BRIAN WROTE WHEN WE COME BACK ON US FARMT

ROUNDTABLE 2
WELL WE'VE BEEN TALKING ABOUT THESE CROP CONDITION RATINGS AND YOU KNOW COULD THIS FUEL PRICES MOVING FORWARD. BUT YOU KNOW WE'VE HAD SOME FAVORABLE PRICES SEEN DECLINES OFF OF THOSE. BUT DO YOU THINK THAT WE PUT THE HIGH IN THESE MARKETS. WELL PERHAPS CORN BEFORE HARVEST AND I'LL SAY IT THAT WAY BECAUSE THE WAY THIS IS PLAYING OUT WITH WHAT WE NEED TO KNOW ABOUT THE CORN CROP THAT WON'T COME PROBABLY TILL CLOSER TO HARVEST OR EVEN AFTERWARDS WHEN WE SEE HOW THE VARIABILITY IN THE EAST COAST OR THE EAST EASTERN BELT COMBINED WITH THE HEAT. AND POLLINATION HEAT IN THE WEST AND HOW THAT PLAYS OUT. WE MAY NOT REALLY KNOW THAT UNTIL WE START TO SEE EITHER WAY IT'S NOT JUST YOUR COUNTY BUT YOUR WAYS IN SEPTEMBER. AND SO FOR THE MINUTE I THINK CORN HOLDS UP FOR 17 AND A QUARTER HIGH. SO I THINK BEANS HAVE A BETTER CHANCE WITH THE RATINGS WHERE THEY ARE. THE RATINGS JUST ACCELERATED TO THE DOWNSIDE THIS WEEK AND WITH THE DRIER FORECAST REGARDLESS OF WHAT HAPPENS IF IT JUST REMAINS DRY. LIKE I SAID BEFORE THAT THE BEAM WILL GO INTO SOME SORT OF A DORMANCY AND IF IT DOESN'T GET THE RAIN THEN IT WILL BEGIN TO ABORT REGARDLESS OF THE TEMPERATURE. SO I THINK THAT BECOMES MORE PROBLEMATIC WITH BEANS ESPECIALLY WHEN YOU SEE THE DEMAND AS STRONG AS IT IS CHINA BY 92 MILLION METRIC TONS OF BEANS SO I THINK THE DEMAND PICTURE AND BEANS WITH THE CURRENCY TAILWINDS WITH THE DOLLAR DOLLAR DOWN 10 AND A HALF PERCENT FOR THE YEAR THE REALES UP 8 PERCENT. BOTH OF THOSE COMBINED HELP US AS US EXPORTERS KEEP A BIGGER SHARE THAN WHAT WE PROBABLY OUGHT TO. AND SO I THINK THOSE ARE GOOD TAILWINDS. I'M PRETTY OPTIMISTIC THE MARKET INTO NEXT YEAR. REALLY QUICK CAUSE I WANT TO HIT ON CONDITIONS WITH YOU SUE BUT REALLY QUICK DO YOU THINK WE PUT THE HIGH IN THESE MARKETS. NO I. FIRST OFF I HAVE A DERIVATIVE OF A FOUR YEAR CYCLE LOW DO THIS MONTH IN AUGUST AND I'M THINKING AUGUST. MY PREFERENCE IS AUGUST 3RD 13TH. THERE'S ONE MORE DATE AFTER THAT BUT I KIND OF THINK WHAT'S GOING TO HAPPEN IS WHAT I THINK THE OTHER TWO MARKETS ARE WAITING ON ON BEANS TO GET IT OUT OF ITS SYSTEM AND TURN AROUND. AND WE'VE BEEN HOLDING THE 200 DAY MOVING AVERAGE WE'VE FALLEN BACK TWICE TO THAT. AND IF WE COME DOWN AND JUST BARELY TAG IT YOU KNOW TODAY WE STILL CLOSED LOWER FOR THE WEEK. AND THE KEY IS WE'RE GOING TO CLOSE HIGHER FOR THE MONTH ON BEANS. CORN IS GOING TO CLOSE. WELL THAT ONE'S UP FOR GRABS BECAUSE THREE AND A HALF IS WHERE YOU CLOSED AT THE END OF JUNE. WE KNEW WE PROBABLY WOULD NOT TAKE OUT 374 BACK IN JULY BECAUSE I WENT BACK AND LOOKED AT SINCE 1970 AND THERE'S NEVER BEEN A TIME THAT CORN HAS HAD TWO OUTSIDE RANGE MONTHS BACK TO BACK. SO WE FELT WE WOULD MOVE INTO A RANGE AND THAT'S KIND OF WHAT'S HAPPENING. BUT I BELIEVE THE FOURTH QUARTER OR THE FOURTH QUARTER OF THIS YEAR I THINK IS GOING TO BE MUCH STRONGER WHEN THE REALISATION STARTS TO COME. KEEP IN MIND THIS YIELD DROPPING RIGHT NOW THE USDA GOT US TAGGED AT ELEVEN POINT NINE JUST SHY OF 12 PERCENT STOCK'S USAGE RATIO TURNS AROUND IF WE DROP THIS YIELD UNDER THAT 163 AND YOU KNOW A 10 PERCENT DROP FROM LAST YEAR'S 157 157 POINT FIVE. AND THEN IF YOU TALK TREND LINE YOU'RE DOWN TO 153. ALL OF A SUDDEN YOU'VE GOT THAT STOCK'S TO USAGE RATIO. IF YOU JUST TAKE IT UNDER 163 63 YOU'RE NOW LOOKING AT A STOCK TO USE RATIO THAT SEQUEL TO 2012. DOESN'T MEAN WE HAVE TO GO UP. BUT WHEN YOU HAVE CHEAP PRICES FOR EXTENDED PERIODS OF TIME YOU EX YOU ESCALATE THE DEMAND AND THE USAGE AND THERE'S A FEW OTHER THINGS THAT ARE HAPPENING THAT'S GOING TO DO THAT. BRIAN LET'S SWITCH TO WHEAT REAL QUICK. WE KNOW WEAK CONDITIONS ARE SUFFERING ESPECIALLY SPRING WHEAT. YOU KNOW IN THE IN THE DRY NORTHERN PLAINS WE TOO ARE LOOKING AT LOWEST YIELDS IN IN A DECADE. I MEAN IS THAT ENOUGH TO PUT FIREWORKS IN THIS MARKET. I MEAN WE'VE PRICED IN A LOT OF THAT ALREADY AND I DON'T KNOW THAT THERE'S A BIG SURPRISE THERE. THE COUNCIL CAME IN WITH A COUPLE OF BUSHELS BELOW THE THEY WERE LAST ARE JUST BELOW WHERE THEY WERE LAST YEAR AND RIGHT ABOUT WHERE THE U.S. IS PROBABLY CONTINUES TO GET SMALLER ESPECIALLY WHEN YOU LOOK AT HARV'S ACRES. BUT I THINK IT'LL BE POST-HARVEST THAT YOU REALLY SEE THE FIREWORKS IN THE SPRING SPRING WEEK BECAUSE STOCKS GET CUT DRASTICALLY ALMOST IN HALF POTENTIALLY. AND I THINK THE ONLY DAY FOR SPRING WHEAT IS IS WHERE THE MORE POWERFUL MOVE WILL COME. I MEAN MARKETS IN A DOWN AND A BICYCLE ARE WE'VE YOU KNOW HAS BEEN GIVEN GROWERS WHO SOLD A CHANCE TO KIND OF COME IN AND REACH OUT INTO THE SPRING. BUT THE REST OF THE OTHER CLASSES THAT WE ARE REALLY NOT A THERE'S NOT A BOOKSTORE THERE NOT YET. NOT NOT NOT QUITE YET. SO WE WERE AGGRESSIVE SELLERS ON SELL SIGNALS IN THE LAST COUPLE OPPORTUNITIES. AND SO WE'RE INCLINED TO SIT TIGHT. ALL RIGHT. WE NEED TO TAKE A BREAK. WE'LL BE RIGHT BACK FOR THEIR CLOSING THOUGHTS. DON'T GO ANYWHERE.

MARKETS NOW
TIME NOW FOR CLOSING THOUGHTS SOON. WELL I THINK THAT WHEN IT COMES TO THE CORN MARKET I THINK FIRST OFF LIKE FRIDAY WAS PROBABLY THE LOWEST VOLUME THAT WE'VE SEEN SINCE JULY OF 2014. SO VERY VERY LOW TRADE. THAT'S NOT USUALLY WHAT YOU SEE IN A HIGH MARKET. I THINK THE MARKET'S EBBING AND FLOWING BUT WE'RE STILL GOING TO COME OUT OF HERE. THIS IS A CORRECTIVE PHASE BOTH ON WHEAT AND CORN THAT WILL SEND US TO MUCH HIGHER LEVELS AS WE GO INTO 18. ALL RIGHT THANKS TO BRIAN. WELL THE GROWER MEETINGS THIS WEEK. THE QUESTION IS I NEED TO SELL SOMETHING BEFORE HARVEST WHAT SHOULD I DO AND I THINK THERE'LL BE RALLIES HERE IN THE NEXT 30 DAYS THAT GROWERS WHO NEED TO SELL GENERATE CASH OR REDUCE STORAGE QUANTITIES THEY'RE GOING TO WANT TO DO THAT HERE IN THE NEXT 30 DAYS. AND I LIKE THE IDEA TO HIM LONG INTO NEXT YEAR. BUT THERE ARE GROWERS WHO HAVE NOT BEEN ABLE TO GET YOU KNOW GET THE STATE GET THE JOB DONE. AND SO THEY WANT TO THEY WANT TO DO THAT HERE IN THE NEXT 30 DAYS. ALL RIGHT. THANK YOU. STAY WITH US JOHN PHIPPS JOINS US NEXT.

JOHN’S WORLD
RURAL BROADBAND HAS BEEN A HOT TOPIC FOR  YEARS.. BUT A BIG ANNOUNCEMENT FROM A LARGE  COMPUTER COMPANY COULD REVOLUTIONALIZE  ACCESS FOR RURAL RESIDENTS... BUT HOW LONG WILL  IT TAKE? HERE'S JOHN PHIPPS.  EARLIER THIS MONTH, MICROSOFT ANNOUNCED AN INITIATIVE TO BRING  HIGH-SPEED BROADBAND TO RURAL AMERICA. ABOUT 24 MILLION  AMERICANS DO NOT HAVE ACCESS TO HIGH SPEED INTERNET SERVICE,  WHICH IS DEFINED AS 25 MEGABITS PER SECOND. WHILE I THINK THIS IS  AN ADMIRABLE PROPOSAL, I DOUBT IT WILL EVER HAPPEN. THERE ARE SOME TECHNOLOGY ISSUES SUCH AS COST OF EQUIPMENT  AND REACH - YOU HAVE TO BE WITHIN ABOUT 2 MILES OF FIBER OPTIC  CABLE AND USER DEVICES CURRENTLY RUN ABOUT $800. MICROSOFT HAS  GENEROUSLY OFFERED TEN BILLION DOLLARS TO HELP WITH COSTS. THERE  ARE LEGAL ISSUES WITH MICROSOFT GETTING CONTROL OF THAT IS CALLED TV  WHITE SPACE AND THE REGULATORY APPROVAL PROCESS WOULD BE  STRONGLY OPPOSED BY BROADCASTERS, AMONG OTHERS. THERE ARE  ECONOMIC ISSUES ABOUT PAYBACK OR WHETHER THERE IS EVEN  MODEST INTEREST AMONG VERY ISOLATED CITIZENS. BUT THE REAL REASON BEHIND MY INDIFFERENCE TO THIS COMMENDABLE  IDEA IS I'VE HAD MY HOPES FOR SERVICES LIKE BROADBAND, OR EVEN  RURAL WATER DASHED BY REALITY TOO MANY TIMES. THE REASON IS  SIMPLE AND INEXORABLE. AREAS LIKE MINE ARE EMPTYING OUT. YOU  CAN SEE IT ON THIS MAP OF POPULATION CHANGE IN IOWA BETWEEN  2010 AND 2015. I USE IOWA BECAUSE IT HAS SUPERB COUNTY LEVEL  DATA. COUNTIES THAT ARE NOT BLUE HAD ZERO OR NEGATIVE POPULATION  CHANGE. AS RESIDENTS BECOME FEWER AND FARTHER APART, IT IS  ALMOST IMPOSSIBLE TO DELIVER SERVICES TO THEM EXCEPT AT  EXORBITANT COST. GIVEN THE CHALLENGES MICROSOFT FACES TO  ACCOMPLISH THIS LAUDABLE GOAL AND THE TIME IT WILL TAKE TO BUILD,  EVEN IF THEY ARE SUCCESSFUL, I DON'T THINK MANY OF THE TRULY RURAL  POPULATION WILL BE THERE WHEN IT ARRIVES.

TEASE
THANKS, JOHN, STILL TO COME, HE'S AN OKLAHOMA  STATE COWBOY, STRIVING FOR INNOVATION, WHILE  NOT VEERING FAR FROM THE COURSE OF TRADITION.  WE'LL HAVE THAT STORY AFTER THE BREAK. 

HEADLINES
WELCOME BACK TO U-S FARM REPORT. WE HAVE MUCH  MORE AHEAD. DESPERATE TMES CALL FOR DESPERATE MEASURES IN  NORTH DAKOTA. WE'LL MEET A CUTTING-EDGE OKLAHOMA STATE  COWBOY WHO'S INNOVATION ISN'T GOING UNNOTICED. BAXTER BLACK IS ON THE SEARCH FOR BILLY THE DOG. AND WE'LL LEARN THE MARKETING LINGO IN CUSTOMER  SUPPORT. 

AGCO-PRECISION MERGER
NOW FOR THE HEADLINES...THREE MONTHS AFTER  MONSANTO PULLED THE PLUG ON A DEAL TO SELL ITS  'PRECISION PLANTING' BUSINESS TO JOHN DEERE,  THERE'S NOW A NEW SUITOR. AGCO ANNOUNCING ITS INTENTIONS TO BUY PRECISION  FROM MONSANTO SUBSIDIARY, THE CLIMATE  CORPORATION. THE TWO COMPANIES HAVE SIGNED A DEFINITIVE  AGREEMENT BUT THE PRICE TAG IS NOT BEING  DISCLOSED. . IN MAY MONSANTO SAID IT WAS TERMINATING THE DEAL  WITH DEERE TO PURCHASE PRECISION PLANTING. THE TRANSACTION HAD BEEN SCRUTINZED FOR  MONTHS BY THE DEPARTMENT OF JUSTICE.  IN AUGUST 2016 THE D-O-J FILED SUIT TO BLOCK THE  AQUISITION, CALLING IT "MERGER-TO-MONOPOLY" IN  HIGH SPEED PLANTING SYSTEMS. . THIS NEW OFFER FROM AGCO WILL NOW UNDERGO  REGULATORY REVIEW. MEANWHILE A GROUP OF NINETEEN DEMOCRATIC  SENATORS ARE PUSHING BACK AGAINST A PROPOSED  MERGER OF MONSANTO AND BAYER.  THE LAWMAKERS  ARE ASKING THE JUSTICE DEPARTMENT TO "CONDUCT A  THOROUGH AND IMPARTIAL ANALYSIS" OF THE  PROPOSED 66 BILLION DOLLAR DEAL. IN A LETTER, THE GROUP SAYS THE DOJ'S ANTITRUST  DIVISION SHOULD "CAREFULLY CONSIDER THE IMPACT  THIS MERGER WILL HAVE ON AGRICULTURAL  BUSINESSES, FARMERS, AND CONSUMERS."  THE COMPANIES HOPE TO CLOSE THE DEAL YET THIS  YEAR.

DROUGHT, MONTANA WILDFIRES
FOUR WILDFIRES HAVE BURNED NEARLY 400 SQUARE  MILES OF DROUGHT-PLAGUED EASTERN MONTANA.  MUCH OF IT IS FARMLAND AND RANCH LAND.  FIREFIGHTERS BELIEVE A LIGHTNING STRIKE STARTED  THE FIRES LAST WEEK.  THE FIRES BURNED 16 HOMES  IN THE SPARSELY POPULATED REGION. AUTHORITIES ARE ASKING RANCHERS AND OTHER LANDOWNERS TO REPORT ANY LOSSES OF LIVESTOCK,  PASTURE, HAY AND FENCING. THE DROUGHT MONITOR SHOWING LITTLE RELIEF FOR  THE HARDEST HIT AREAS.  IN MONTANA, EXCEPTIONAL DROUGHT, THE WORST  LEVEL, JUMPED UP 10 POITNS IN A WEEK.. NOW NEARLY  12 PERCENT OF THE STATE SEEING EXCEPTIONAL  DROUGHT CONDITIONS.  AND 23 POINT 8 PERCENT UNDER EXTREME  CONDITIONS. AND JUST TO THE EAST,  7 POINT 6 PERCENT OF NORTH  DAKOTA IS SEEING EXCEPTIONAL DROUGHT, THE  WORST LEVEL OF DROUGHT.  AND MORE THAN 45 PERCENT OF THE STATE IS UNDER EXTREME CONDITIONS.  AS NORTH DAKOTA'S DROUGHT CONDITIONS ARE  WORSENING,  DROUGHT AND SOME AREAS ARE NOW  CLASSIFIED AS BEING IN  "LONG TERM" DROUGHT.   FARMERS AND RANCHERS ARE NOW FORCED TO  RESORT TO  DRASTIC MEASURES TO DEAL WITH DRY  CONDITIONS THAT ARE  DESTROYING CROPS AND  PASTURES. CLIFF NAYLOR REPORTS.  NAT SOUND OF HAY MOWER....  RUSSELL WAGNER IS CUTTING 400 ACRES OF  CONSERVATION RESERVATION PROGRAM LAND FOR FEED, BUT IT'S  NOT  NEARLY ENOUGH FORAGE TO GET HIS CATTLE THROUGH WINTER.  OTHER  LIVESTOCK PRODUCERS ARE CUTTING POOR QUALITY SMALL  GRAIN CROPS  LIKE OATS, BARLEY, AND HARD RED SPRING WHEAT FOR  HAY.  IF IT WILL FEED A COW IT WILL BE CUT DOWN  AND  TURNED INTO SOME SORT OF NUTRITION FOR THE ANIMALS.   WAGNER FEELS MORE THAN 50% OF NORTH DAKOTA'S CRP LAND SHOULD HAVE BEEN OPENED UP FOR   HAYING BECAUSE THE NEED FOR FEED IS SO GREAT AND THE QUALITY  OF  CRP HAY IS MARGINAL.      CRP HAS ISN'T TYPICALLY THE HIGHEST  QUALITY BECAUSE IT HAS A LOT OF  OLD DEAD MATERIAL IN IT SO  IT'S NOT GOING TO BE A VERY HIGH FEED  VALUE, HOWEVER  IT'S GREAT FOR FILLER.    CLAY MCPEAK IS CUTTING 900 ACRES OF CRP.  HE  SAYS IT'S SO DRY  HE'S CHOPPING AND BALING THE SAME  DAY.     "SOME OF IT'S A BALE AN ACRE,  SOME OF IT'S A  LITTLE MORE, OR IT'S LESS, IT'S  NOT REAL GOOD."   EXTENSION AGENT PENNY NESTER SAYS FARMERS MAY  SOON HAVE  MORE THAN THE QUANTITY AND QUALITY OF CRP HAY TO  WORRY ABOUT.     "TYPICALLY DROUGHT DOESN'T ONLY AFFECT ONE  YEAR OF  PRODUCTION, IT MAY AFFECT MORE THAN ONE YEAR OF  PRODUCTION."   NAT SOUND OF BALE BEING MADE....  "IF WE DON'T GET RAIN THIS YEAR, WE DON'T GET A  GOOD SNOWFALL THIS  YEAR, WE COULD HAVE DROUGHT NEXT YEAR AND  THAT JUST ESCALATES  THE ISSUES AND PROBLEMS ASSOCIATED WITH  THAT."    MANY FARMERS  HAVE CARRYOVER HAY FROM LAST YEAR THAT WILL HELP GET THEM   THROUGH THE COMING WINTER, BUT AFTER THOSE RESERVES ARE USED   UP, THE NEED FOR MOISTURE WILL BECOME EVEN MORE CRITICAL FOR  THE  2018 GROWING SEASON.  THANKS, CLIFF.

WEATHER
THAT'S IT FOR NEWS...METEOROLOGIST MIKE  HOFFMAN JOINS AGAIN.MIKE, WE'VE BEEN FOCUED ON  THE DROUGHT IN THE NORTHERN PLAINS. IS THERE ANY  RELIEF IN SIGHT LONG-TERM?  TYNE I DON'T SEE A GOOD CHANCE OF RAIN UNFORTUNATELY FOR THE FAR  NORTHERN PLAINS. ANY TIME YOU GET A RIDGE LIKE THIS IT'S JUST GOING  TO SIT THERE AND STAY HOT AND DRY. THE TROUGH CONTINUES OUT EAST.  YOU CAN SEE EVEN ON INTO WEDNESDAY THAT'S THE CASE WITH MORE  ENERGY DIVING IN. YOU CAN ALWAYS GET A LITTLE BIT OF RAIN IN THE  NORTHERN PLAINS OUT OF THESE LITTLE DISTURBANCES KIND OF MOVING  THROUGH THE UPPER PORTION OF THE RIDGE. BUT I JUST DON'T SEE A REAL  GOOD CHANCE. LET'S TAKE A LOOK AT OUR 90 DAY OUTLOOK WILL SPLIT UP  THE TEMPERATURES INTO THE THREE MONTHS AUGUST ABOVE NORMAL  MID-ATLANTIC SOUTHEAST NORTHERN HALF OF THE PLAINS. MOST OF THE  WEST ABOVE NORMAL BELOW NORMAL IN EASTERN PORTIONS OF  CANADA. NOW BY SEPTEMBER WE'RE GOING TO START INTRODUCING  SOME BELOW NORMAL AREAS FOR THE NORTHWESTERN GULF COAST AREA.  MUCH OF TEXAS LOUISIANA ABOVE NORMAL MID-ATLANTIC NORTHEAST  NORTHERN PLAINS IN THE WEST AND THE OCTOBERS. STILL FROM THE  DAKOTAS THROUGH THE WEST ABOVE NORMAL BELOW NORMAL SOUTHERN  MISSISSIPPI VALLEY AND ABOVE NORMAL ALONG THE EASTERN SEABOARD AS FAR AS PRECIPITATION ABOVE NORMAL FROM THE MID- ATLANTIC TO THE GULF COAST INTO THE SOUTHWEST BELOW NORMAL  UNFORTUNATELY FOR THE DAKOTAS IN NEBRASKA. TYNE. THANKS, MIKE.

FARM JOURNAL REPORT
OUR PARTNERS AT TOP PRODUCER MAGAZINE AWARD A  YOUNG PRODUCER UNDER THE AGE OF 35 EVERY YEAR  WHO DEMONSTRATES EXCELLENCE IN MARKETING,  TECHNOLOGY, ENVIRONMENTAL STEWARTSHIP AND FAMILY AND EMPLOYEE RELATIONS.  THE 2017 TOMORROW'S TOP PRODUCER HORIZON  AWARD IS GIVEN TO CODY GOODKNIGHT OF  CHATTANOOGA, OKLAHOMA, WHO IS STRIVING AT  KEEPING TRADITION WHILE CREATING INNOVATION.  BETSYJIBBEN HAS THE STORY.   SWAYING WHEAT WAITS TO BE CUT AS THE HUM OF  CODY GOODKNIGHT'S COMBINE ROLLS THROUGH THESE  OKLAHOMA FIELDS. FOR HIM, HARVEST IS NOT ROUTINE, IT'S TRADITION.  THIS FAMILY HAS WORKED THESE SOILS FOR FIVE  GENERATIONS. <"IT'S IN OUR BLOOD. WE CAN'T GET RID OF IT. IT'S JUST SOMETHING WE  REALLY REALLY ENJOY,"> THE CHATTANOOGA PRODUCER WHO HOLDS THE REINS  OF GOODKNIGHT FARMS IS BUSY WORKING WITH HIS  CREW. NEARBY, A MAN WHO FARMED BEFORE HIM. <YOU CAN SEE JOHN IN HIS PICKUP, WE MIC'ED HIM UP WHEN HE SAT  IN THE VEHICLE. "I NEVER GET AWAY FROM IT,"> IT'S CODY'S FATHER, JOHN,  PIONEEERED THE FARM'S  FORAY INTO WHEAT, COTTON, SESAME, SORGHUM,  SOYBEAN, AND GRASSLANDS FOR THEIR CATTLE.  ONE OF THE FIRST IN THE COMMUNITY TO NO- TILL...CURIOUS ABOUT CONSERVING MOISTURE AND  MAINTAINING HIS SOIL DURING THESE DUSTY OKLAHOMA SEASON. LESSONS CODY INHERITED,  PASSED ON FROM HIS FATHER'S PASSION.  <JOHN THE DAD STILL MIC'ED IN THE PICKUP> <"NOT ONLY HAS HE  FOLLOWED IN MY FOOTSTEPS, HE'S EXCEEDED IT."> <SWITCHED THE TWO SOTS ?> <CODY MIC'ED UP IN MACHINERY> <"WE ARE NEVER COMPLACENT,  WE'RE NEVER HAPPY ABOUT WHERE WE'RE AT, WE ALWAYS THINK THERE'S  A BETTER WAY TO DO THINGS. WE DON'T JUST WANT TO COAST. WE ALWAYS  WANT TO BE IMPROVING. AND I LEARNED THAT FROM HIM,"> BUT THE REAL WORK STARTS WITH NEVER LEAVING  LAND BARE. AND COVER CROPS ARE HELPING.  "ONE REASON WE GROW IT IS TO HELP BREAK UP COMPACTION,"> GOODKNIGHT PLANTS MOST ROW CROPS EXCEPT FOR  COTTON IN 15 INCH ROWS.  <"THE REASON WE DO 15 INCH ROWS IS TO GET THE GROUND COVERED  SOONER, MORE SHADE IN THE GROUND."> AND THEY USE STRIPPER HEADS DURING WHEAT  HARVEST, TAKING GRAIN AND LEAVING THE STRAW  STANDING..  <"ANOTHER BIG BENEFIT IS JUST SHADE AND WIND AND WATER EROSION  PROTECTION FOR US IN NO TILL VERSUS HAVING THE STRAW CUT AND LEFT  BARE, <"RIGHT NOW, WE ARE HARVESTING ABOUT 7 MILES AN HOUR, WITH THE  CONVENTIONAL HEADER, WE'RE HARVESTING 3 AND A HALF TO FOUR MILES  AN HOUR,"> WHILE CODY HAS GROWN THESE VISIONS - HE HAD A  NICE JUMP-START. HIS DAD, JOHN DEVELOPED A CERTIFIED SEED WHEAT  BUSINESS WHICH HAS BEEN A STAPLE OF THE  OPERATION FOR MORE THAN 25 YEARS, ANNUALLY,  ROUGHLY 40 THOUSAND BUSHELS OF SEED SOLD TO 50  GROWERS. THE NUMBER FLUCTUATING THOUSANDS  DEPENDING ON THE CASH WHEAT MARKET AND  DEMAND.  <"IT CERTAINLY GAVE US A NICHE IN THE MARKET. OUR SEED WHEAT  PRICE DOESN'T FLUCTUATE AS MUCH AS NORMAL COMMODITY PRICES AND  IT GIVES A PREMIUM FOR OUR WHEAT,"> GOODKNIGHT SAW HOW HIS DAD ADDED VALUE IN  WHEAT AND WANTED TO MIRROR SIMILIAR SUCCESS  WITH THE LIVESTOCK SECTOR HE ENVOLVED AND CHANGED THE COW-CALF  OPERATION TO AI-ING HEIFERS WITH HIGH END  GENETICS.  <"I WANTED TO DO THE SAME THING WITH HEIFERS. I WANTED TO RAISE  SEED STOCK HEIFERS FOR OTHER PEOPLE TO PURCHASE FROM ME,"> AND IT'S IN THESE FIELDS AT HARVEST... THE FAMILY  AND CREW TAKE TIME, EVERY NIGHT TO GIVE THANKS.<"YOU JUST REMEMBER WHAT YOU'RE FIGHTING FOR,"> PARKING THE MACHINERY..  A MOMENT TO SLOW DOWN <"IF ALL YOU'RE EVER DOING IS WORKING AND SLAVING AWAY FROM  DAYLIGHT UNTIL DARK, WHAT'S THE POINT?"> TO SHARE A HOME-MADE MEAL AND BE TOGETHER... <". WE TAKE TIME TO ENJOY OURSELF AND STOP TO SMELL THE ROSES YOU  MIGHT SAY,"> BECAUSE FARMING THROUGH OKLAHOMA'S  UNPREDICTABLE WEATHER IS NOT FOR THE FAINT OF  HEART. THEY'RE GRATEFUL FOR EACH YEAR THE  WHEAT DANCES INTO HARVEST... BRINGING PROMISE OF  A FUTRE AND PLANTING SEEDS FOR THE NEXT  GENERATION...  REPORTING IN CHATTANOOGA, OKLAHOMA, I'M BETSY JIBBEN THANKS, BETSY.  GOODKNIGHT SHOWS HEIFERS AT THE SOUTHWEST  EXPO FORT WORTH STOCK SHOW EVERY YEAR WHICH  IS ONE OF THE OLDEST LIVESTOCK SHOWS IN THE  COUNTRY. HIS ANIMALS HAVE PLACED FIVE OF THE  PAST SIX YEARS AND HE'S EVEN WON A RESERVE  GRAND CHAMPION TITLE.  UP NEXT, JOHN PHIPPS

CUSTOMER SUPPORT
DURING OUR MARKETING ROUNDTABLES, MANY  ANALYTS THROW OUT TERMINOLOGY TO HELP WITH  YOUR MARKETING PLAN. BUT IT'S THAT TERMINOLOGY  THAT CAN LEAVE MANY CONFUSED. TO CUT THROUGH  THE CONFUSION, HERE'S JOHN PHIPPS.  LOYAL VIEWER LINDA MILLER LOBS A DANGEROUS QUESTION MY WAY. "MARKET ANALYSTS CONSTANTLY RECOMMEND CALLS AND PUTS TO HELP  PRODUCERS TAKE OUT SOME OF THE RISK IN COMMODITY PRICES. HOW  OFTEN DOES THE CALL OR PUT ACTUALLY PAY OUT FOR THE FARMER? ON THE  OTHER SIDE, IS IT JUST THE ANALYSTS THAT COME OUT AHEAD?" LINDA SEND ME AN ADDRESS FOR YOUR MUG. THIS IS ONE OF THOSE  DEBATES WHERE THEORY AND PRACTICE DON'T OVERLAP AS MUCH AS  YOU THINK. OPTIONS LIKE PUTS AND CALLS, WHICH ARE ESSENTIALLY THE  RIGHT TO BUY OR SELL THE UNDERLYING CONTRACT AT A GIVEN PRICE ARE  MOST FREQUENTLY RECOMMENDED IN CONCERT WITH CASH MARKET  ACTIONS TO ACT AS INSURANCE AGAINST MARKET MOVES. FOR EXAMPLE,  I CAN MAKE A PROFIT IF I SELL CORN FOR 4 DOLLARS, BUT I'M RELUCTANT TO  DO SO BECAUSE THE MARKET MIGHT GO UP. SO I COULD SELL THE CORN  WHEN IT HITS 4 DOLLARS AND BUY A 4-DOLLAR CALL FOR X CENTS A BUSHEL  THAT WILL RISE IN VALUE IF THE MARKET DOES GO UP. THE THEORY HERE  IS THIS HELPS ME ACTUALLY PULL THE TRIGGER. I GET MY 4 DOLLAR CORN  AND IF THE MARKET GOES UP I CAN TAKE ADVANTAGE. IF THE MARKET  DOESN'T, I AM OUT THE OPTION COST OF X CENTS, BUT I STILL HAVE CORN  SOLD FOR $4. LOOKED AT THIS WAY, OPTIONS ARE ONLY PART OF HOW  MUCH MONEY YOU MAKE. THEY ARE OFTEN COMPARED TO INSURANCE,  AND YOU DON'T EXPECT TO MAKE MONEY ON YOUR CAR INSURANCE,  AFTER ALL. PROPERLY EXECUTED OPTIONS SHOULD NOT BE EXPECTED TO  CONSISTENTLY GENERATE INCOME, BUT PROTECT INCOME FROM CASH  SALES. AS I SAID, THAT IS THE THEORY. IN PRACTICE IT TAKES CONSIDERABLE SELF- DISCIPLINE TO STAY HAPPY WITH CONSTANT LOSSES IN YOUR TRADING  ACCOUNT. AND MORE OFTEN THAN NOT, THIS VERY SIMPLE CASH SALE  AND OPTIONS LINKAGE EVOLVES INTO MORE COMPLICATED OR EVEN  SPECULATIVE TRADING IN AN EFFORT TO HAVE YOUR PROTECTION CAKE AND  EAT IT TOO. I SPEAK FROM EXPERIENCE. AS IS CONSTANTLY REPEATED MOST OPTIONS EXPIRE WORTHLESS, BUT  THAT DOESN'T MEAN THEY HAVEN'T HELPED THE CUSTOMER MAKE  MONEY. IT MAY SEEM LIKE THE ANALYSTS ARE THE BIGGEST WINNERS,  BUT IF YOUR OPTION PROGRAM DOESN'T HELP YOUR PROFIT PICTURE, FOR  WHATEVER REASON, FARMERS WILL STOP USING BOTH OPTIONS AND THE  ANALYST.

TEASE
THANKS, JOHN. IF YOU AHVE A QUESTION OR A  COMMENT FOR JOHN, EMAIL HIM AT MAILBAG AT U-S  FARM REPORT DOT COM. WHEN WE COME BACK, WE'RE OFF TO THE WEST TO PAY  A VISIT TO BAXTER BLACK. 

BAXTER BLACK
ARIZONA ACTUALLY SEEING SOME DROUGHT RELIEF  THIS WEEK IN THE LATEST DROUGHT MONITOR...  HOPEFULLY BAXTER BLACK SAW SOME OF THAT RAIN.  BUT THIS WEEK, THERE'S MORE THAN DRY WEATHER ON  HIS MIND. HERE'S BAXTER BLACK.  HARRY GOT A NEW HOUND DOG PUPPY NAMED BILLY. BILLY SOON  ADAPTED TO THE NEW NEIGHBORHOOD. AND BY THE TIME SHE WAS NINE  MONTHS OLD SHE HAD BEGUN TO EXPLORE FURTHER AFIELD. SO IT WAS  NECESSARY TO PEN HER UP NIGHT. ONE MORNING HE WENT OUT IN HER COMFY BLUE NIGHTGOWN WITH A  FAINT AND PATTERN OF PENGUINS IN SNOWFLAKES TO FEED BILLY TO HER  EXASPERATION. BILLY HAD FLOWN THE COOP. THERE HE SCUFFLED ACROSS  THE YARD SHOUTING BILLY. BILLY. BILLY AT THE EDGE OF THE PASTURE. SHE STOPPED TO SURVEY THE  HORIZON. LO AND BEHOLD SHE SAW BILLY ACROSS THE PASTURE IN THE  NEIGHBOR'S YARD. IT WAS AN ACID REFLUX MOMENT. BILLY WAS RACING  ALONG THE RIDGE WITH AN OBJECT IN HER JAWS WAS WHITE FEATHERED  OBJECT TO BE PRECISE. STILL YELLING THERE HE CLIMBED THE WIRE FENCE  IN BELLY BILLY AND CROSSED THE FIELD WITH HER PENGUIN AND  SNOWFLAKE NIGHTY DRAGGING IN HER WAKE AND CAUGHT A GOOFY LITTLE  BILLY WHO WAS DELIGHTED TO SHOW HER WHAT SHE HAD CAUGHT AND  THEN HE NOTICED THAT THE GROUND AROUND HER LOOKED LIKE A BROILER  BATTLE FIELD A CAMPBELL'S SOUP CATASTROPHE A FIELD OF FLATTENED  FOWL AND ALL THE CHICKENS WERE NAKED BARE BREASTS EVERYWHERE  AND LOOK LIKE ONE OF THOSE RENAISSANCE PAINTINGS. THEY HAD LOST  THEIR FEATHERS DISTRAUGHT. DARRY WENT UP TO HER NEIGHBOR'S DOOR.  SHE CONFESSED BILLY'S CRIME CHICKEN MURDER IN THE SECOND  DEGREE. SHE OFFERED TO PAY RESTITUTION. THE NEIGHBOR TOOK IN  DEARIES APPEARANCE MUDDY UP TO HER HIPS FEATHER STUCK TO HER  ARMS AND IN HER HAIR AND HER NIGHTGOWN DRAGGING BEHIND HER LIKE  A BRIDAL TRAIN AT A GREASED PIG CONTEST. THEY ARE NOT DEAD SAID  THE NEIGHBOR I CHASED HER DOG AWAY. JUST NOT IN TIME BUT YOUR  DOG DIDN'T KILL HIM SHE JUST PLUCKED HIM. WELL WHAT CAN I DO.  ASKED DARRY. WELL A NEIGHBOR THOUGHT IT OVER AND SAID. I AM A  LITTLE WORRIED ABOUT HIM GETTING HEATSTROKE. OH OKAY SAID DARIEL I'LL RUN HOME AND GET SOME SUNSCREEN.  EITHER THAT THE NEIGHBOR OR BBQ SAUCE. THIS IS BAXTER BLACK FROM OUT THERE.   YOU CAN HEAR MORE OF BAXTER'S HUMOR ONLINE AT  BAXTER BLACK DOT COM.WHEN WE COME BACK, TRACTOR TALES. PLEAS STAY  WITH US. 

TRACTOR TALES
TRACTOR TALES BROUGHT TO YOU BY THE MOST  TRUSTED NAME IN FARM EQUIPMENT, MACHINERY  PETE!. WELCOME BACK TO TRACTOR TALES FOLKS!  THIS WEEK WE'RE OFF TO  ILLINOIS FOR A FAMILY-OWNED FARMALL C.  THIS 1953 CLASSIC RED WAS  PURCHASED NEW ON THE FARM.  AND AFTER YEARS OF HARD WORK, THIS  TRACTOR HAS SHED ITS WORK CLOTHES FOR A LIFE OF PARADES.  THIS  TRACTOR WAS BOUGHT NEW HERE ON A FARM BOUGHT NEW IN 53 BY MY  FATHER-IN-LAW BEFORE I WAS PART OF THE PICTURE HERE AND THAT WAS  HIS. HE USED IT TO PULL HIS FOUR ROW CORN PLANTER AND. HAY HAY  JOBS AND. ALL JUST SMALL TRACTOR JOBS AROUND ON THE FARM. AND  WHEN I GOT HERE IN 1963. I PULLED THE FOUR ROW PLANTER WITH IT FOR A  COUPLE OF YEARS AND THEN IT STILL DID THE HAY WORK AND. BACK THEN  WE USED A HAY ROPE TO PULL THE HAY IN THE BARN THAT WAS THAT  TRACTOR JOB OF THE BULL IN THE BARN. BUT DID A LOT OF HAY RAKING AND  MOWING AND THINGS OF THAT NATURE. TODAY ITS A SHOW TRACTOR THAT  I'VE TAKEN ON TRACTOR RIDES IT BARELY GOES FAST ENOUGH SO I HAVE TO  RUN THE MOTOR FASTER THAN I'D LIKE. SO I'VE HAD IT DONE IN TWO OR  THREE RIDES BUT IT'S. SMALL RIDES AROUND THE FARM WE USE IT TO PULL  HAY RACK WHEN WE HOST PEOPLE HERE ON THE FARM WILL HAVE A  WRECK RIGHT NOW. THAT'S DISTRACTORS JOB IT'S JUST BASICALLY LOOK  PRETTY. IT'S PROBABLY GOING TO STAY WITH THE FARM. I'M GUESSING THAT  ITS ROOTS ARE STARTED HERE AND IT'S PROBABLY GOING TO STAY HERE  AFTER I'M GONE. HOPEFULLY OUR KIDS WILL KEEP THE FARM GOING HERE  WHEN I'M OUT OF THE PICTURE SO IT'S PROBABLY GOING TO STAY AROUND  AWHILE. 

COUNTRY CHURCH SALUTE
THIS WEEK, WE'RE HEADING SOUTH FOR OUR  COUNTRY  CHURCH SALUTE. IT  GOES TO THE CAMP SPRINGS  METHODIST CHURCH LOCATED IN CHOCTAW COUNTY,  ALABAMA. THEY TELL US ITS A RURAL CHURCH,  HOLDING ONLY ONE SERVICE A YEAR, AND THAT'S A  MEMROTIAL TO THOSE BURIED IN THE CEMETARY. AND  DURING THAT ONE SERVICE, IT BRINGS BACK SPECIAL  MEMORIES FOR LIFE LONG MEMBERS.  OUR THANKS TO NANCY WHATLEY FOR SHARING THEIR  STORY.  STAY WITH US - FROM TEH FARM PHOTOS ARE NEXT!

FROM THE FARM
WELCOM EBACK. WHILE MOST OF THE WEST IS IN A  MUCH BETTER MOISTURE SITUATION THAN PAST YEARS,  THE BETTER THAN EXPECTED RAINFALL AND SNOW THIS  WINTER HELP GROW TALLER GRASSA AND MORE  VEGETATION. UNFORTUNATELY MAKING THE PERFECT BREEDING GROUNDS FOR WILDFIRES.  THOUSAND OF FIREFIGHTERS ACROSS 10 WSETERN  STATES ARE BATTLIGN WILDFIRES. THAT INCLUDES IN  CALIFNROA.  AND CHECK OUT THESE PICTURES FROM TONY TOSO OF  COTTON CREEK RANCH. IT SHOWS THE BURNING AND  AFTERMATH. HE SAYS CHUTES ADN CORRALS WERE  DESTROYED, AND YOU CAN SEE THE FLAMES NEARING  THE BARN OVERNIGHT. BUT AT LAST, CALM AFTER THE  CHAOS... AND HE CALLS IT PEASE IN THE AFTERMATH.  COWS TAKING A DRINK.  AND BRAD DOWNS, GRAND FORKS, ND: "CHECKING  CANOLA FIELDS WITH THE FAMILY. WHAT HASN'T GOT  HIT WITH HAIL IS PRETTY GOOD!"  AND JASON ALLEN, NEW FRANKEN, WISC. SAYS WHEAT  HARVEST IS UNDERWAY. THEY'VE ONLY HARVESTED  TWO DAYS, BUT ARE BANKING ON DECENT WEATHER ON  FRIDAY AND THE NEXT WEEK. AND ANNIE IN LENA, ILL. SAYS WHO THOUGHT THEY   WOULD BE KAYAKING TO CHECK ON THE CORN. THAT'S  HER HUSBAND MATT. THERE'S BEEN TOO MUCH RAIN IN  NORTHWESTERN ILLINOIS  LAST WEEKEND, WITH 7  INCHE SFALLING OVERNIGHT.   YOU KNOW AND IT'S REALLY WE'VE SAID IT'S THE HAVES AND THE HAVES AND HAVE NOTS YOU KNOW AS FAR AS MOISTURE GOES DOES THAT CONTINUE TO PLAY OUT. NO I THINK WE ARE A LITTLE BIT DIFFERENT IN THAT RESPECT. THOSE WERE JUST COMPLEXES THAT JUST KEPT HITTING THE SAME AREA IF THEY WOULD HAVE SHIFTED EVEN NORTH AND SOUTH A LITTLE BIT. IT'S GOING BE DRY IN THE CORN BELT THOUGH FOR A WHILE IT LOOKS LIKE NOW. SO WE DON'T WANT IT TO GET TOO DRY. IF YOU HAVE ANY PICTURES YOU WOULD LIKE TO SEND YOU CAN DO THAT TO THE ADDRESS ON THE SCREEN FOR ALL OF US THAT US FARM REPORT.

CLOSE
I'M MIKE HOFFMAN WITH TINED MORGAN. THANK YOU FOR WATCHING US. FARM REPORT. YEAH BE SURE TO TUNE IN NEXT WEEKEND AS WE WORK TO BUILD ON OUR TRADITION. HAVE A GREAT WEEKEND EVERYONE.

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