USFR Weekly Recap - February 26-27, 2011

February 28, 2011 01:59 AM
 

THIS WEEK ON U.S. FARM REPORT
EPISODE #1959
FEBRUARY 26-27, 2011

JOHN’S OPEN: HELLO AND WELCOME TO U.S. FARM REPORT, I'M JOHN PHIPPS. YOU WOULD THINK THAT AFTER THE COMMODITY MARKET TRUCK HAD RUN OVER ME A FEW TIMES THIS YEAR, I WOULD LEARN NOT TO PLAY IN THE STREET. BUT ONCE AGAIN, I PULLED MY HEAD OUT OF A TRACTOR REPAIR TO CHECK THE MARKETS AND HAD TO CURB MY TONGUE WITH MY GRANDSON STANDING AROUND. WE HAVEN'T EVEN GOTTEN TO THE WEATHER RUMOR STAGE YET, AND MARKETS ARE ACTING LIKE ITS HOT AND DRY IN LATE JUNE. FOR THOSE OF US LOOKING FOR WHEN THINGS WILL CALM DOWN, THE USDA OUTLOOK CONFERENCE WAS NOT MUCH HELP. ALL HAS MORE ON THAT IN A MINUTE. JUDGING FROM MY OWN REACTION TO MARKET GYRATIONS, I SUSPECT THERE MAY BE SOME BABY-BOOMER RETIREMENT DECISIONS BEING MADE JUST TO GET SOME SLEEP. TIME NOW FOR THE HEADLINES.....HERE'S AL PELL

USDA OUTLOOK: THANKS JOHN. THE AG DEPARTMENT SAYS AN ADDITIONAL TEN MILLION ACRES WILL BE PLANTED TO CROPS THIS YEAR, THE LARGEST YEAR-TO-YEAR INCREASE SINCE 1996. AS A RESULT, TOTAL CROPLAND IS EXPECTED TO HIT 255-MILLION ACRES. AT THE AG DEPARTMENT'S OUTLOOK FORUM THIS WEEK IN WASHINGTON, CHIEF ECONOMIST JOE GLAUBER PREDICTED FARMERS WILL PLANT 92-MILLION ACRES OF CORN, UP NEARLY FOUR MILLION. SOYBEANS WILL REACH 78 MILLION, UP SLIGHTLY. WHEAT IS FORECASTED TO REACH 57-MILLION AND COTTON PLANTINGS ARE EXPECTED TO COVER 12.8 MILLION, A GAIN OF ABOUT THREE MILLION ACRES. DESPITE INCREASED PRODUCTION, GLAUBER EXPECTS SUPPLIES WILL REMAIN TIGHT DUE TO STRONG EXPORT DEMAND AND BIOFUELS. HE EXPECTS CORN AND SOYBEANS STOCKS SHOULD ONLY SEE MODEST RE-BUILDING.

OIL PRICES: THE TURBULENCE IN LIBYA IS STARTING TO HIT THE POCKET-BOOK OF CONSUMERS COAST-TO-COAST. THE PRICE OF OIL THIS WEEK PASSED $100 A BARREL FOR THE FIRST TIME SINCE OCTOBER OF 2008. IF YOU'VE FILLED YOUR CAR OR TRUCK WITH OFF-FARM FUEL, YOU FELT THE INCREASE. TRIPLE A SAYS THE NATIONWIDE AVERAGE FOR A GALLON OF GASOLINE IS $3.28 A GALLON, UP 14-CENTS FROM A WEEK AGO. AND UP 59-CENTS FROM A YEAR AGO.

EQUIPMENT EXPORTS: U.S. EXPORTS OF AG-RELATED MACHINERY TOTALED NEARLY NINE BILLION DOLLARS IN 2010. THE ASSOCIATION OF EQUIPMENT MANUFACTURERS SAYS THAT'S A GAIN OF MORE THAN 12% FROM ‘09. AEM SAYS THIS INCREASE IS ENCOURAGING AFTER 2009 DECLINES OF MORE THAN 20%. SOUTH AND CENTRAL AMERICA RECORDED THE STRONGEST GAINS. FARM EQUIPMENT EXPORTS TO SOUTH AMERICA GREW 59% WITH PURCHASES TOTALING 970 MILLION. AT MORE THAN 3-BILLION DOLLARS, CANADA REMAINS THE BIGGEST BUYER OF AMERICAN-MADE MACHINERY.

SORGHUM CHECKOFF: VOTING TO RENEW THE TWO-YEAR-OLD NATIONAL SORGHUM CHECKOFF CLOSES MONDAY. UNDER USDA REQUIREMENTS, GROWERS MUST VOTE AGAIN TO CONTINUE THE PROGRAM. THE SORGHUM CHECKOFF REQUIRES PRODUCERS TO PAY .6% OF THE NET MARKET VALUE WHEN THEY SELL THEIR GRAIN. CHECKOFF LEADERS SAY MUCH OF THE MONEY HAS GONE TO NEW MARKET DEVELOPMENT...INCLUDING THE ESTABLISHMENT OF MARKETS IN MOROCCO, EGYPT, ISRAEL AND SEVERAL ASIAN NATIONS. U.S. FARMERS HARVESTED ABOUT SIX MILLION ACRES OF SORGHUM LAST YEAR.

ROUNDTABLE: REGGIE GRIFFITHS AND BILL BIEDERMANN

JOHN’S WORLD: THE ROLLING PROTESTS IN THE MIDEAST CONTINUE TO DOMINATE THE NEWS. WHILE MANY OF US WERE MILDLY CURIOUS WHEN TUNISIA ERUPTED AND EVEN DISTRACTED BY THE EGYPTIAN REVOLT, I THINK LIBYA FINALLY HAS OUR FULL ATTENTION. TO BE SURE THIS IS LARGELY DUE TO THEIR BIZARRE AND BUFFOONISH DICTATOR, HE-WHO-MUST-NOT-BE-SPELLED. THE IDEA OF GETTING THAT BOZO OUT OF POWER IS SOMETHING I COULD ROOT FOR. BUT I AM STRUGGLING TO GRASP WHAT IS TRULY HAPPENING. AND I THINK I JUST DISCOVERED WHY. CONSIDER THESE DEMOGRAPHICS. THE MEDIAN AGE - WHERE HALF THE PEOPLE ARE OLDER AND HALF YOUNGER - OF THE U.S. IS ABOUT 37. TO COMPARE, CHINA'S MEDIAN AGE IS 35, AND JAPAN'S IS A SHOCKING 45. GET THIS: THE MEDIAN AGE IN THE ARAB WORLD, HOWEVER, IS 22. IN PAKISTAN IT IS 21, FOR PETE'S SAKE. WHAT THIS SAYS TO ME IS IN ADDITION TO VAST CULTURAL AND ESPECIALLY RELIGIOUS DIFFERENCES, THERE IS A WHOPPING AGE GAP TO CONTEND WITH. LOOK, I DON'T UNDERSTAND 22 YEAR OLD AMERICANS. THIS TELLS ME USING MY HISTORY TO MAKE PREDICTIONS PROBABLY WON'T HELP MUCH. THE MIDEAST ISN'T LIKE THE U.S. IN THE SIXTIES, OR EVEN THE USSR IN THE 80'S. IN FACT, I THINK ONE REASON PROTESTERS HAVE BEEN SO SURPRISINGLY SUCCESSFUL IS THEY ARE TOTALLY NEW PLAYERS ON THE WORLD STAGE WITH UNIQUE IDEAS AND THEIR OWN DESTINY. DICTATORS USING YESTERDAY'S THINKING TOTALLY UNDERESTIMATE THEM. FOR MY MONEY, THESE KIDS GOT HERE JUST IN TIME. YOU PROBABLY HAVE A DIFFERENT OPINION - LET US KNOW.... SEND EMAILS TO MAILBAG@USFARMREPORT.COM OR CALL AND LEAVE US A VOICE MAIL.

2ND HALF:
JOHN’S OPEN:
HELLO AND WELCOME TO U.S. FARM REPORT, I'M JOHN PHIPPS. IN TURBULENT TIMES WE OFTEN TRY TO FIND SOLACE BY LOOKING BACKWARDS. "HISTORY REPEATS ITSELF" WE REMIND OURSELVES. I'M NOT SO SURE THE MORE ACCURATE ADAGE WOULD BE "HISTORIANS REPEAT EACH OTHER". IT IS OUR STORIES OF WHAT HAPPENED THAT ARE SIMILAR, NOT THE ACTUAL EVENTS. IN FACT, RESEARCHERS HAVE SHOWN THAT MEMORY IS THE WORST POSSIBLE SOURCE OF HISTORY. EVERY TIME WE REPLAY A MEMORY WE STORE IT SLIGHTLY DIFFERENTLY, SO OUR STRONGEST RECOLLECTIONS ARE ALMOST ALWAYS OUR MOST INACCURATE. IF YOU DON'T BELIEVE ME YOU WILL AFTER YOUR NEXT HIGH SCHOOL REUNION. NOT TO WORRY - GOOD MEMORIES ARE OVERRATED. BESIDES, FROM NOW ON IT WILL ALL BE ON FACEBOOK, ANYWAY. LET'S GET STARTED WITH THE HEADLINES AND AL PELL....

RENEWABLE ENERGY: THANKS JOHN. THE NUMBER OF AMERICAN FARMS USING TECHNOLOGY TO PRODUCE RENEWABLE ENERGY HAS INCREASED SIGNIFICANTLY THE PAST DECADE. A USDA SURVEY SHOWS MORE THAN 1,400 FARMS USE WIND TURBINES ON THEIR LAND. THE SURVEY EXCLUDED LARGE WIND-FARMS THAT ARE CONSIDERED "COMMERCIAL" PROPERTIES. WHEN IT COMES TO SOLAR POWER, NEARLY 8,000 FARMS USE THAT TECHNOLOGY AND MORE THAN 120 FARMS UTILIZE A METHANE DIGESTER. METHANE DIGESTERS CAPTURE EMISSIONS FROM DAIRY HERD MANURE. THE GAS IS USED TO POWER GENERATORS ON THE FARM. THAT POWER IS USED TO RUN LIGHTS AND OTHER EQUIPMENT. EXCESS POWER IS OFTEN SOLD TO A LOCAL POWER COMPANY. THE BRUBAKER DAIRY FARM INSTALLED THE TECHNOLOGY FIVE YEARS AGO AS A WAY TO RAISE REVENUES WITHOUT ADDING MORE COWS TO THEIR HERD. METHANE DIGESTERS ARE NOT CHEAP. THEY CAN RUN ANYWHERE FROM ONE MILLION TO FIVE MILLION DOLLARS TO INSTALL. THAT'S WHY THAT TECHNOLOGY IS USUALLY RESERVED FOR LARGER DAIRY PRODUCERS. IN ADDITION TO THE DIGESTER, BRUBAKERS ALSO INSTALLED 10,000 SQUARE FEET OF SOLAR PANELS ON THEIR BARNS TO PRODUCE ADDITIONAL ELECTRICITY.

PEANUT CASE: WE HAVE UPDATES TODAY ON TWO HIGH PROFILE SALMONELLA CASES. THE FIRST INVOLVES THE PEANUT RECALL FROM TWO YEARS AGO. VERMONT SENATOR PATRICK LEAHY HAS ASKED THE DEPARTMENT OF JUSTICE FOR AN UPDATE ON THE INVESTIGATION INVOLVING THE PEANUT CORPORATION OF AMERICA. PCA WAS LINKED TO A NATIONWIDE SALMONELLA OUTBREAK IN 2009 WHERE MORE THAN 700 PEOPE BECAME ILL. NINE PEOPLE DIED. THE OUTBREAK LED TO A MASSIVE RECALL OF PEANUT PRODUCTS, SUCH AS THOSE USED IN CRACKERS AND COOKIES. DURING A CONGRESSIONAL HEARING, PCA PRESIDENT STEWART PARNELL REFUSED TO TESTIFY. TO DATE, NO CRIMINAL CHARGES HAVE BEEN FILED AGAINST THE COMPANY. SENATOR LEAHY HAS ASKED ATTORNEY GENERAL ERIC HOLDER FOR AN UPDATE ON THE INVESTIGATION.
TOMATO SALMONELLA: YOU MAY REMEMBER A SALMONELLA SCARE TWO YEARS AGO THAT WAS ULTIMATELY LINKED TO BAD PEPPERS FROM MEXICO. BUT BEFORE INVESTIGATORS WERE ABLE TO LINK THE OUTBREAK TO PEPPERS, IT WAS MISTAKENLY ASSOCIATED WITH TOMATOES. ACCORDING TO A REPORT IN THE NEW ENGLAND JOURNAL OF MEDICINE, INVESTIGATORS BEGAN THEIR SEARCH BY ASKING VICTIMS WHAT THEY HAD EATEN WEEKS PRIOR TO THE OUTBREAK. SEVERAL REMEMBERED EATING SALSA, BUT INVESTIGATORS DIDN'T LINK IT TO ONE OF THE KEY INGREDIENTS - - PEPPERS. THE INITIAL CONNECTION TO TOMATOES DROVE PRICES DOWN, FORCING MANY GROWERS TO DUMP THEIR CROPS. A LOBBYING GROUP FOR THE PRODUCE INDUSTRY SAYS BY PREMATURELY JUMPING TO THAT CONCLUSION, OFFICIALS UN-WITTINGLY ALLOWED THE OUTBREAK TO CONTINUE.

GEORGIA FRUIT RISK: THE UN-SEASONABLY COLD WEATHER THAT HIT THE SOUTHEAST UNITED STATES THIS WINTER MAY PUT SOME POPULAR FRUIT CROPS AT RISK. GEORGIA'S STATE CLIMATOLOGIST SAYS THE PEACH AND BLUEBERRY CROPS COULD BE DAMAGED BY A SPRING-FREEZE. BOTH CROPS REQUIRE A CERTAIN AMOUNT OF COLD WEATHER - KNOWN AS CHILL HOURS. THAT TIME HELPS THE TREES AND BUSHES TO SET THEIR FRUIT PROPERLY FOR SPRING. ONCE THOSE CHILL HOURS ARE MET, THE CROPS ARE SET TO BLOOM. WARM WEATHER COULD CONVINCE THE FRUIT IT'S TIME TO GROW. UNFORTUNATELY, WITH THE LA-NINA WEATHER PATTERN, ANOTHER COLD BLAST COULD HAPPEN...IF SO, CROP DAMAGE IS A REAL POSSIBILITY.

HEARTLAND: WHEN IT COMES TO FINDING JUST THE RIGHT INGREDIENTS FOR HIS CREATIONS, VIRGINIA'S "FIRST CHEF" BELIEVES IT'S ALWAYS GOOD TO LOOK "LOCAL FIRST". IN THIS REPORT FROM THE VIRGINIA FARM BUREAU, SHERRI MCKINNEY TAKES US INSIDE THE GOVERNOR'S MANSION IN RICHMOND. TO LEARN MORE ABOUT AGRICULTURE IN THE OLD DOMINION STATE, HEAD ONLINE TO WWW.VAFARMBUREAU.ORG ...WE'LL POST A LINK ON OUR HOME PAGE FOR INSTANT ACCESS. NEXT WEEK WE'RE OFF TO HAPPY HOLLOW FARMS TO SEE HOW INNOVATION MAKES ITS POSSIBLE TO GROW FRESH VEGETABLES IN THE DEAD OF A MISSOURI WINTER...THAT STORY NEXT WEEK ON "SPIRIT OF THE HEARTLAND".

BAXTER BLACK: BAXTER BLACK IS A MAN OF MANY WORDS...AND THIS WEEKEND, HE SHARES A FEW ABOUT THE LOSS OF A GOOD FRIEND AS HE BRINGS US A COWBOY'S EULOGY. BAXTER WILL JOIN US AGAIN IN TWO WEEKS...UNTIL THEN, CHECK OUT HIS WORK ONLINE AT WWW.BAXTERBLACK.COM . WHEN WE COME BACK, TRACTOR TALES FEATURES A 60-YEAR-OLD CASE PLUS WE'LL HAVE OUR COUNTRY CHURCH SALUTE...PLEASE STAY WITH US.

TRACTOR TALES: WE'RE OFF TO MINNESOTA THIS WEEK TO LEARN ALL ABOUT THE RESTORATION PROCESS ON A 1948 DC CASE. COLLECTOR LEE SACKETT TAKES IT FROM HERE. THE DC LINE HAD TWO MODELS...THE DC-3 WAS BUILT FOR NARROW ROWS WHILE THE DC-4 HAD A WIDE FRONT.

CHURCH SALUTE: TODAY'S COUNTRY CHURCH SALUTE GOES TO THE HOUSTON UNITED METHODIST CHURCH IN SOUTHWEST ILLINOIS. THE CHURCH WAS ORGANIZED IN 1864 AS THE OAKLAND CHURCH, BUT SHORTLY THEREAFTER CHANGED THE NAME WHEN LAND WAS DONATED BY JOHN HOUSTON FOR A CHURCH. IN 1913 THE CHURCH ORGANIZED THE HOUSTON ORCHESTRA. MEMBERS OF THAT GROUP HAVE FIFTH GENERATION DESCENDANTS STILL ATTENDING. THE CHURCH WAS FOR DECADES ALSO FAMOUS FOR HOMEMADE APPLE BUTTER AND STILL OCCASIONALLY MAKES A COUPLE OF COPPER KETTLES OF THE TASTY SPREAD. MINISTRIES INCLUDE NURSING HOME VISITATION, SUMMER VACATION BIBLE SCHOOL AND THE HEIFER PROJECT. A RECENT SPECIAL PROJECT INVOLVED CREATING SEVEN STAINED GLASS WINDOWS THAT TIE THE PAST, PRESENT AND FUTURE TOGETHER. THE WINDOWS WERE INSTALLED IN MEMORY OF FAITHFUL MEMBERS. THE CHURCH IS PART OF A SEVEN POINT CHARGE. THE DIRECTING PASTOR IS REV. DIXIE CROXTON. KAREN STAUFFER SENT US THE PHOTOS AND HISTORY. AS ALWAYS WE WANT TO LEARN ABOUT YOUR HOME CHURCH AS WELL... SALUTES CAN BE SENT TO THE ADDRESS ON THE SCREEN. STAY WITH US - THE MAILBAG IS NEXT.

MAILBAG: TIME NOW FOR OUR WEEKLY LOOK INSIDE THE FARM REPORT MAILBAG....A VIEWER IN MARYLAND IS CONCERNED ABOUT THE GROWTH OF ORGANIC PRODUCTS: “THERE'S NOT A GROCERY STORE OUT HERE THAT'S NOT SELLING ALL NATURAL ORGANIC FOODS AND IS SELLING PRODUCE LIKE IT'S GOING OUT OF STYLE... IT'S ONLY A MATTER OF TIME TILL THE CHINESE, RUSSIANS AND THE EUROPEAN MARKETS WILL BE WANTING THE CHANGE TO ORGANICS. THEN WHERE WILL YOU BE?"
WELL, ORGANIC SALES AREN'T QUITE THAT HOT. IT IS A CLASSIC CASE OF MARKETING SPIN AND POOR PUBLIC MATH SKILLS. LET ME ILLUSTRATE: ORGANIC FOOD AND BEVERAGE SALES WERE ABOUT 27 BILLION DOLLARS IN 2009. THIS IS A BIG NUMBER UNTIL YOU COMPARE IT TO TOTAL FOOD SALES OF JUST OVER 1 TRILLION DOLLARS. ORGANIC SALES ARE ABOUT 3 PERCENT. ORGANIC SALES GROWTH WAS ABOUT 5 PERCENT IN 2009. BUT THE TOTAL FOOD MARKET GREW AT ABOUT 3% SO ORGANIC ONLY GAINED A SHARE GROWTH OF 2 PERCENT. THIS IS LESS THAN A TENTH OF PERCENT OF MARKET SHARE. AT THIS RATE IT WILL TAKE DECADES TO GET TO EVEN 10% OF MARKET SHARE. SECOND, MOST OF THE LOW-HANGING ORGANIC FRUIT HAS BEEN PICKED. CARROTS ARE ABOUT 25 PERCENT ORGANIC, FOR EXAMPLE. ORGANIC MILK AND ESPECIALLY MEAT ARE GROWING MUCH SLOWER. JUDGING THE MARKET BY SHELF SPACE CAN BE DECEPTIVE. ALSO, THE EUROPEAN ORGANIC MARKET IS ABOUT 15 YEARS AHEAD OF US, AND IT FLATTED OUT. FINALLY, I DON'T HAVE PROBLEMS WITH CONSUMERS CHOOSING MORE EXPENSIVE FOOD.BUT ALL ORGANIC WOULD REQUIRE A VERY EXPENSIVE MARKET INCENTIVE. I THINK THAT OUTCOME IS VERY, VERY UNLIKELY.
AS ALWAYS, WE WANT TO HEAR FROM YOU, SEND COMMENTS TO MAILBAG@USFARMREPORT.COM OR LEAVE US A VOICE MAIL AT 800-792-4329.

 

 

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