USFR Weekly Recap - April 22-23, 2017

TODAY ON U.S. FARM REPORT
APRIL 22-23, 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. A DAIRY FAMILY IN WISCONSIN PUT ON A 30-DAY NOTICE TO FIND A NEW HOME FOR THEIR MILK... WHILE THE PRESIDENT SAY FIXING NAFTA WILL HELP, CANADA IS PUSHING BACK. WHAT’S BEEN THE BIGGEST SURPRISE FOR MACHINERY PETE IN 2017? < BOY, FIRST 3 1/2 MONTHS OF 2017, WE’VE SEEN SOME REALLY STRONG PRICES ON SPRAYERS.> WE’RE ON THE ROAD WITH MACHINERY PETE. AS RANCHERS IN THE PLAINS TRY TO RISE FROM THE ASHES, THE DEVESTATION STILL FRESH IN THEIR MINDS... BUT THER’S A NEW WAY TO HELP. WE’LL TELL YOU ABOUT THE MILLION DOLLAR WILDFIRE RELIEF CHALLENGE. AND IN JOHN’S WORLD...

TALKS OF BILATERAL TRADE WITH JAPAN
NOW FOR THE MARKET RELATED NEWS, THE TRUMP ADMINISTRATION TAKING THE FIRST STEP IN LAUNCHING A BILATERAL TRADE DEAL WITH JAPAN, IN HOPES OF REACHING A NEW TRADE DEAL. DURING HIS 10 DAY TOUR OF ASIA, VICE PRESIDENT MIKE PENCE LAUNCHING BILATER TRADE TALKS, TO TAKE THE PLACE OF THE TRANS PACOFIC PARTNERSHIP. WHILE JAPAN SAYS IT WONT’ GIVE UP ON THE TPP AND WILL MOVE AHEAD WITHOUT THE U-S, PENCE STILL PUSHING FOR WHAT HE CALLS A BALANCED BILATERAL TRADE RELATIONSHIP WITH NOT ONLY JAPAN, BUT OTHER COUNTRIES. <. OUR GOAL IS SIMPLE, WE SEEK TRADE THAT IS FREE, AND WE SEEK TRADE THAT IS FAIR. THIS REQURIES BREAKING DOWN BARRIERS, LEVELIGN THE PLAYINF FIELD SO THAT AMERICAN COMPANIES AND EXPORTERS CAN ENJOY HIGH LEVELS OF MARKET ACCESS. >DETAILS AREN’T BEING NEGOTIATED YET, AS THE U-S DOESN’T HAVE A U-S TRADE REPRESENATTIVE CONFIRMED.

LEAN HOG FUTURES
LEAN HOG FUTURES SEEING MAJOR PRICE PRESSURE THIS WEEK, FALLING TO THE LOWEST LEVEL SINCE OCTOBER. HERD EXPANSION AND FUND LIQUIDATION LEADING TO THE DOWNWARD SLOPE. HERE’S STANDARD GRAIN’S JOE VACLAVIK ON THE SIXTH MONTH LOW IN PRICES. .

DAIRY PRODUCTION
WHILE U-S DAIRY FARMERS FACE AN OVERSUPPLY SITUATION, PRODUCTION CONTINUES TO CLIMB. USDA’S LATEST MILK PRODUCTION REPORT SHWOING PRODUCTION GREW 1 POINT 8 PERCENT IN MARCH, TOTALLYING 17.5 BILLION POUNDS. PRODUCTION PER COW IS ALSO ON THE RISE, UP 18 POUNDS ABOVE LAST YEAR. SOUTH DAKOTA SEEING THE BIGGEST JUMP, WITH STATE PRODUCTION CLIMBING 16 POINT 4 PERCENT.

BRAZILIAN MEAT SCANDAL
63 PEOPLE WERE INDICTED WITHIN BRAZIL’S MINISTRY OF AGRICULTURE OVER THE MEAT PACKING SCANDAL. THE CHARGES SURROUND FEDERAL AUTHORITIES, ACCUSED OF TAKING BRIBES IN EXCHANGE FOR FRAUDULENT SANITARY PERMITS. AND CLAIMS THIS WENT ON FOR YEARS. THIS STEMS FROM THE POLICE PROBE ON MARCH 17TH INTO THE WORLD’S LARGEST BEEF EXPORTER. AFTER THE RAIDS, THE COUNNTRY’S EXPORTS PLUMMETED, BUT HAVE SINCE REBOUNDED.

MEXICO-ARGENTINA TRADE DEAL
OFFICIALS IN MEXICO THINK THEY COULD HAVE A TRADE DEAL WITH ARGENTINA WORKED OUT BY THE END OF THE YEAR. THAT INCLUDES REDUCING TARIFFS ON BOTH AUTOMOBILES AND AG PRODUCTS. REUTERS REPORTING TALKS ADVANCED THIS WEEK, AS MEXICAN OFFICIALS LOOK FOR OTHER SOURCES OF PRODUCTS SUCH AS GRAIN.

PLANTING PROGRESS
FARMERS ABLE TO MAKE SOME PLANTING PROGRESS LAST WEEK, BUT PROGRESS STILL LAGGING LAST YEAR. USDA SAYS 6 PERCENT OF HTE CORN CROP IS IN THE GROUND, DOWN 6 PERCENTAGE POITNS FROM LAST YEAR. BUT 8 PERCENT OF THE COTTON CROP IS PLANTED. THAT’S A POINT AHEAD OF AVERAGE AND USDA CALLING 54 PERCENT OF THE WINTER WHEAT CROP GOOD TO EXCELLENT, IMPROVING ONE POINT FROM LAST WEEK. DROUGHT STARTING TO CREEP ACROSS THE SOUTHEAST AGAIN. THE LATEST DROUGHT MONITOR SHOWING 80 PERCENT OF THE REGION IS CONSIDERED ABNORMALLYL DRY, AN INCREASE OF 5 POINTS IN A WEEK. AND 44 PERCENT IS IN MODERATE DROUGHT... A JUMP OF 11 POITNS IN THE PAST WEEK. BUT IMPROVEMENTS IN THE SOUTHERN PLAINS. KANSAS SEEING A 5 POINT IMPROVEMENT TEH ABNORMALLY DRY CONDITIONS, AND D-1 OR MODERATE DROUGHT, IS PRETTY MUCH WIPED OFF THE MAP IN THAT STATE, A BIG IMPROVEMENT FROM 3 MONTHS AGO.

WEATHER
THOSE ARE THE HEADLINES...METEOROLOGIST CINDI CLAWSON IS IN FOR MIKE HOFFMAN THIS WEEK. CINDI- SOME HAIL AND SEVERE WEATHER PUSHED ACROSS THE U-S THIS WEEK. WHAT’S IN STORE NEXT WEEK? WELL, TYNE I THINK WE’RE GOING TO SEE MROE ACTIVE WEATHER AS WE HEAD INTO THIS COMING WEEKEND. ELT’S START WITH THE DORUGHT MONITOR AND WE’VE SEEN STILL A LOT OF IMRPOVEMENT IN WESTERN PARTS OF COUTNRY BUT WE ARE WATCHING THE SOUTHEAST BECAUSE THAT’S WWHERE WE ARE SEEING DYRNESS EXPAND OVER THE LAST 4 WEEKS BOY NOTICE THE DIFFERENCE A MONTH AGO. AND AS WE CONITUE THROUGHT TIME WE’RE GOIGN TO BE SEEING GREAT IMPROVEMENT ACROSS AREA ESPEICALLY IN PLAINS STATES AND IN TEH WEST BUT WATCH AS THE DRYNESS COINTIES TO EXPAND ESPECIALLY AS YOU GET TOWARD GEORIGA AND INTO FLORIDA. ALRIGHT WHAT DO WE HAVE FOR THE WEEK AHEAD? SOME MORE ACTIVE WEATHER WE’VE GOT A FRONT ACROSS NORHTERN TIER OF STATES LOOK FOR SHWOERS LAONG THAT. WE SEE A FRONT IN CENTRAL NADN NORTHERN PLAISN THAT’S GOING TO PUSH OFF TO THE EAST AS YOU GET TO EARLY PART OF HTE WEEK. LOOKING AT SOME VERY WEARM TEMPS ACROSS THE SOUTH MAYBE SOME EWINDY CONDIIONS AS WELL ON WESNEDAY WE’RE GOING TO BE SEEING HTAT FRONT MOVE INTO THE GREAT LAKES, DOWN THROUGH MUCH OF CORN BELT AND INTO SOUTHERN PLAINS AND WE’LL CONTINUE TO SEE SOME WET WEATHER IN NORTHWESTERN UNITED STAES. HIGH PRESSURE KEEP MOST OF SOUTEHAST DRY AS WE GET INTO WENDESDAY. FRIDAY LOOK A LOT LIKE WEDNESAY BUT IT’S DIFFERENT PART OF FRONT AS WE SEEE ANOTHER LOW PRESSURE OVER TOWARD CHICAOLAND STRETCHING DOWN INTO PARTS OF PLAINS AND STILL WET WEATHER IN PARTS OF NORTHWEST, WE’LL BE HOT AND MOSTLY SUNNY AS YOU GET DOWN INTO THE THERE IN THE SOUTHERN UNITED STAETS. WE’LL HAVE ANOTHER LOOK AT WEATHER COMING UP IN NEXT HALF HOUR TYNE. THANKS CINDI.

TEASE
WELL, PRICE PRESSURE ON GRAINS THIS WEEK. WE’LL FINOUT WHY WITH DAN HUEBER AND KEVIN DULING AFTER TRHE BREAK.

ROUNDTABLE 1
WELCOME BACK HERE NOW WITH ME THIS WEEK TDAN HUEBERT AND KEVIN DULING TO TALK MARKETS LET ‘S START OFF WITH THIS CORN MARKET. I MEAN REALLY WHAT ‘S CAUSING THAT THIS PRESSURE IS IT SOLELY THE FINDS MEAN IS IT JUST LOOKING AT THAT THE MASSIVE SUPPLIES OF SOUTH AMERICA WHAT ‘S PLAYING INTO THIS CORN MARKET RIGHT. CERTAINLY A COMBINATION OF ALL THE ABOVE BUT I THINK AS MUCH AS ANYTHING WE JUST DON’T HAVE A NEW STIMULUS IN THERE. THE MARKET IS, YES WE KNOW THE FUNDS ARE ON THE SHORT SIDE, BUT THEY DON’T HAVE A GREAT INCENTIVE TO ADD ADDITIONAL THERE. WE KNOW THE ACREAGE TWO WERE RELEASED WERE WHERE WE’RE GUESSING THE ACREAGE IS GONNA BE LOWER THIS YEAR. SO THAT THAT ELIMINATES MAYBE SOME OF THE DOWNSIDE INCENTIVE, BUT TO REALLY GET A RALLY STIMULATING OR SOMETHING TO STIMULATE A RALLY WE’RE GONNA HAVE TO GET A WEATHER MARKET. THAT’S JUST NOT IN THE CARDS THIS EARLY IN THE YEAR JUST YET. YES IF YOU LOOK AT PREVIOUS YEAR ‘S CAN CAN YOU COMPARE THIS YEAR IN THE CORN MARKET TO ANY OTHER YEAR?? IF WE JUDGE ON THE CURRENT WEATHER MAPS, IT ‘S LOOKING LIKE TWO THOUSAND NINE, TWO THOUSAND THIRTEEN. BOTH PLAY AND WE HAD SOME DELAYS THERE. IN BOTH OF THOSE YEARS WE THE LOWS WERE MADE LAST WEEK OF APRIL. IN WITH THAT IN MIND, AND THEN THE ON THE MARKET RALLIED ABOUT A DOLLAR OFF EACH OF THOSE. IN THE FUND ‘S SHORT TO DO THAT. BUT IS AS DAN SAYS THE WEATHER MAPS HAVE TO CONFIRM WE HAVE TO KEEP THE THE SOILS COLD. WE HAVE HAVE MORE RAIN TO DO THAT OTHERWISE IT ‘S GONNA ACT HEAVY.AND THIS RAIN IS ‘S IN THE FORECAST AGAIN WHEN WE LOOK AT THESE COOLER TEMPERATURES KIND OF THAT WORKS VERY. IT ‘S IN RIGHT NOW. BUT THAT HASN’T REALLY HIT THE MARKET YET. DO YOU THINK IT WILL IN THE IN THE COMING WEEK??? IT IS REALLY ALWAYS A CHALLENGE TO GET MARKETS TO REALLY GET ACTIVE ON TOO MUCH MOISTURE IN THE SPRINGTIME. PARTIALLY ONE BECAUSE YOU KNOW RAIN MAKES GRAIN IS PART OF THE MENTALITY. BUT THE OTHER IS WE KNOW IT ON THE SEVEN TO TEN DAY PERIOD WE COULD HAVE THE CROP PLANTED. IT ‘S REALLY GOING TO BE PUSHING HIS BACK WHILE AND MAYBE FOR THINKING OH GREAT GET MUCH EXCITEMENT AND TOO LATE IN THE SEASON TO GET THE CORN IN THE GROUND. YOU A GRAMMY COULD WE GET A LITTLE BIT OF A BUMP ANYWHERE IF WE COULD GO TO HAVE LIKE ANOTHER WEEK OF DELAY PLANS??? AS WE LOOK AT THE FUND POSITION .WHEN YOU COULD COUNT THE AGGREGATE FUND POSITION OF CORN, BEANS, WHEAT, IT ‘S BY FAR RECORD SHORT SO IT ‘S NOT GONNA TAKE THAT BIG OF A STIMULUS TO GET IN THE NORTH A SIZABLE BUMP IN THE THING I JUST YOU KNOW WE CAN’T SEE IT TODAY. AND IN ON HIM TELLING PRODUCERS NOW ‘S NOT A SELL WINDOW. JUST WAIT TILL WE HAVE SOMETHING CONCRETE HERE. IT ‘S NOT YOUR TIME IF YOU HAVE NORMAL WEATHER, CORN’S GOING TO BACK UP. WE’RE GONNA DROP STOCKS, WHEAT’S GONNA DROP STOCKS BEANS ARE GONNA ADD. TO ME, THEY’RE THE MOST BEARISH GRAIN RIGHT NOW. BUT THE LEAST THE DEMAND IS GONNA REMAIN. IN A LARGE SOUTH AMERICAN CROP. I MEAN IT CONTINUES TO JUST GO A LOT BUT YOU THINK THAT ‘S ALREADY PRICED PRETTY MUCH PRICED IN??? TO A LARGE EXTENT. THE BRAZILIAN CROP OF COURSE IS THE YEAR IS THE BIGGER OF THE TWO, JUST BY PRODUCTION STANDARDS. BUT ALSO BECAUSE ARGENTINA IS STILL HAVING A LITTLE BIT OF A WEATHER ISSUE AT THIS POINT. SOME AND MOST HAVE STARTED BUT HAVE STARTED TO BACK OFF THEIR CROPS JUST A TOUCH. MAYBE A MILLION METRIC TONS. IT IS NOT A NOT A LARGE SCALE BACK AWAY. BUT BUT IT ‘S A LITTLE LESS SUPPLY THAN MAYBE WAS ONCE ANTICIPATED. BUT I AGREE 100%. WE ARE IN A TRUE SUPPLY SIDE MARKET WHICH MEANS IT IS WEATHER RELATED ISSUES.DEMAND IS TURN OUT IS PHENOMENAL. I MEAN WE WE REALLY HAVE RECORD LEVELS OF DEMAND LEVELS BOTH CORN AND BEANS. BUT THE SAME TOKEN THE MARKET KNOWS THAT IS NOT LIKE IT INCREASING AT SOME EXPONENTIAL RATE IS REALLY GOING TO SHOCK US OUT HERE. SO IT HAS TO BE A WEATHER ISSUE AND RIGHT NOW THIS IS NOT THE CARDS JUST YET. CERTAINLY THE CRITICAL MONTHS AHEAD OF US HERE SO WHAT ABOUT THIS WEHAT MARKET IN A MEETING HAS NOT REALLY BEEN FUN TO WATCH AGAIN TO SAY PRICES ARE SO LOW THAT WE CANNOT MOVE ANY LOWER AND WHEAT MARKET CONTINUES TO PROVE US WRONG SO WE’LL TALK ABOUT THE FUNDAMENTALS BUT ALSO THE TECHNICALS OF THE WHEAT MARKET REALLY WHAT ARE WE LOOKING AT RIGHT NOW WE’LL DO THAT WHEN WE COME BACK

ROUNDTABLE 2
WELCOME BACK WELL LET ‘S TAKE A LOOK AT THIS WHEAT MARKET WE SEE SOME COOLER TEMPERATURES IN THE FORECAST WHEN WE LOOK OVER THE NEXT SEVEN TO TEN DAYS OUT DO YOU THINK THAT POSSIBLY WE COULD SEE SOME DAMAGE AND IF SO WILL THE MARKET EVEN CARE???? IF THE MARKET IS DOING ITS BEST TO WARN US THAT THEY THAT DOES NOT WANT ANY MORE RECORD PRODUCTION LIKE LAST YEAR. WE HAD SUCH HIGH YIELDS IN SO MANY PLACES. EVERYWHERE EXCEPT FOR THE EU ESSENTIALLY HAD HIGH YIELDS. IT’S DOING ITS BEST TO SAY WE’LL GO LOWER IF YOU DO THAT AGAIN. THE GOOD NEWS IS I DON’T KNOW IF YOU BASE IT ON CROP RATINGS TODAY I DON’T THINK WE’RE GONNA SEE THAT. AND ONCE WE GET THE NEW NUMBERS IN MAY WHICH WILL BE THE FIRST NEW CROP LOOK FOR TWO THOUSAND SEVENTEEN, EIGHTEEN LOOK AT THE SUPPLY AND DEMAND, YOU’RE GONNA SEE THE MAJOR EXPORTERS DROP THIRTY, THIRTY FIVE MILLION METRIC TONS THATS A LOT. AND SO IF WE FACTOR CHINA OUT OF THE EQUATION AND WHO ‘S GOT ONLY FIFTY ONE PERCENT OF THE STOCKS, YOU GONNA ACTUALLY HAVE A TIGHTEST STOCKS USAGE EVER. SO IT ‘S TO ME IT ‘S IT ‘S VERY INTERESTING SITUATION. DEMAND’S GOING TO BE RECORD BREAKING AGAIN NEXT YEAR. INDIA ‘S GONNA IMPORT, CHINA CONTINUES TO IMPORT. IT DOESN’T QUITE WARRANT THE NINE HUNDRED MILLION BUSHEL NET SHORT THE SPECS AT THE MOMENT. SO BASICALLY RIGHT NOW THE PRESSURE IN THE WHEAT MARKET IS IT JUST FUNDS??? ABSOLUTELY. YOU AND I THINK YOU WERE YOU BROUGHT A GREAT POINT. YOU REALLY APPLIES TO CORN AS WELL AND WE LOOK OVER IN CHINA. A LOOK AT THE INVENTORY THEY HAVE AND THEY REALLY BALLOON THE WORLD INVENTORY IT KINDA SKEWS WHAT ‘S OUT THERE. ONE OF THOSE PRODUCTS ARE NOT GOING TO LEAVE CHINA. THEY’RE NOT FIND A WAY TO USE THEM AT HOME. BE IT CORN BE IT WHEAT IF YOU EXCLUDE THOSE FROM THE WORLD NUMBERS WE REALLY HAVE A VERY TIGHT STOCKS TO USAGE RATIO OR AVERAGE AT BEST SO HERE AGAIN I THINK THE MARKET KIND OF PUT THE BLINDERS ON. AND WHAT WE HAVE ALL THE SUPPLIES YOU KNOW THERE ‘S NO ISSUE OUT THERE AND AGAIN IT WOULD NOT TAKE MUCH OF A DISRUPTION THAT AND ALL OF A SUDDEN THAT PICTURE CHANGED PRETTY DRAMATICALLY AT THE SAME TIME WE LOOK AT THIS LOW WHAT A WIN BUT WHICH ARE WHEAT AND SPRING WHEAT PLANTINGS AND WE GOT HIM SO IT SEEMS LIKE IT ‘S SETTING THIS UP FOR IT EVEN MORE TIGHTER STOCKS SCENARIO AS WE GO ENTER INTO THE NEXT YEAR??? YEAH I AGREE WITH IT WE DON’T HAVE ROOM FOR BIG HICCUPS ON THE WORLD SCALE. IF WE DO HAVE A BIG HICCUP LIKE THE DRYNESS IN EUROPE SO TO SPEAK RUSSIA ‘S TRENDING DRY, WE COULD REALLY DROP THE CARRY OUT. SO I GUESS I’M TELLING PRODUCERS IF YOU HAVE TO SELL SELL BUT MAN WE GOT A BUY BACK OPTION VOLATILITY IS JUST LOW EVEN BY AT THE MONEY CALLS CHEAP. AND YOU KNOW WAS THIS WORTH RE OWNERSHIP. YES. CERTAINLY WE’VE ENCOURAGED PEOPLE TO MAINTAIN OWNERSHIP. STILL UTILIZE BASIS. YOU KNOW TAKE A TAKE WHAT THE MARKET GIVES YOU A LOCAL AREA TRY TO TAKE ADVANTAGE OF THAT. BUT WHEN IT COMES TO A POTENTIAL UPSIDE, MAINTIAN OWNERSHIP IN SOME FASHION OR ANOTHER OFTEN TIMES THE BEST WAY TO DO THAT IS THROUGH AN OPTION CONTRACT PARTICULARLY WITH THE LOW VOLATILITY THAT WE SEE HERE. AND NOW ARE YOU TELLING PRODUCERS IN THE SAME ON CORN???? IF THE BASEST LEVEL ARE CORRECT. OUR APPROACH TO MARKETING OFTENTIMES IS YOU KNOW WE GET SO WRAPPED UP IN PRICE THAT WE TEND TO THINK PRICE FIRST, BASIS AND SPREAD LATER. WE TRY TO TAKE THE OTHER TRACK PLAY YOUR BASIS. YOU KNOW YOU KNOW YOU’RE A LOCAL BASIS LEVELS. THOSE ARE AREAS THAT REALLY CAN TAKE ADVANTAGE OF. A YEAR IN YEAR OUT, THERE SO MANY TOOLS THAT ARE AVAILABLE TO YOU TODAY THE PRICE CAN BE MANIPULATED IF FOR LACK OF A BETTER WORD, WITH OTHER INSTRUMENTS BUT MANAGE YOUR BASES MANAGERS, MANAGE YOUR SPACE AND THEN WORK ON THE PRICE WITH YOU EITHER FROM PHYSICAL INVENTORY OR THROUGH THE USE OF FUTURES AND OPTIONS. SO IT OUT OF THE PRESSURE IN THE SWEEP IT WITH HAHN ‘S ALSO SEEN SOME PRESSURE THIS WEEK AT SIX A LOW AGAIN IS THAT JUST THE ONES DICTATING PRICES??? WELL HE OFTEN DICTATING PRICES BUT ALSO MEAN WE WE CERTAINLY HAVE AN AMPLE SUPPLY OF HOGS AROUND YOU KNOW THAT THE NUMBERS WE KNOW OUR BACK ON THE INCREASE IN PROBABLY CONTINUE TO FIND, NOT THAT THIS IS NECESSARY GOING TO STOP THEM BUT DEMAND HAS NOT REALLY A COME BACK TO LIFE NECESSARILY THE WAY IT SHOULD. A LOT OF EMPHASIS OVER IN THE CATTLE RIGHT NOW WITH THE IDEA THAT WE’RE GOING TO START MOVING MORE CATTLE TO CHINA SO I THINK THAT YOU STAY AWAY AND PROBABLY LITTLE SPREAD ACTIVITY ON TOP OF IT WERE A YEAR A FAVOR IN THE CATTLE OVER THE HOGS AT THIS POINT I’M AWFULLY CLOSE TO THE TAIL END OF THAT? RIGHT NOW CAL IS ONE OF THOSE BRIGHT SPOTS THIS WEEK WHEN WE LOOK AT THE ONE POSITION IN THE CATTLE MARKET IN WHAT ARE YOU SEEING???ONE OF THE FEW AG AND MARKETS DO AND THEY MAY CONTINUE THAT FOR A WHILE SO WE MAY GET A GOOD OPPORTUNITY AT SOME POINT. THE NUMBERS IS THE RESULT IN PROBABLY EVEN SPLIT BETWEEN THE BULLS AND BEARS IN THE FORM THE FUNDAMENTAL SIDE YOU HAVE YOU KNOW GOES BACK TO THAT LARGE PLACE A NUMBER WE HAD A FEW MONTHS AGO.BUT FOR SOME REASON THEIR PUSHING CATTLE FORWARD. IT ‘S PRETTY DYNAMIC. AND REAL QUICK DO YOU THINK THE CATTLE MARKETS OVER DONE??? NOT NECESSARILY KNOW I MEAN I THINK WE HAVE A COUPLE WEEKS AGO REALLY LOOK LIKE WE WERE A HAD REACHED A A A TIPPING POINT THE OTHER NEWS ABOUT CHINA CAN REALLY REINVIGORATED THE BULLS ONCE AGAIN. I DON’T THINK WE HAVE A TREMENDOUS MAN UPSIDE RIGHT NOW BUT IT EVER CLOSE BUT NOT QUITE THERE. ARE I THINK YOU WILL GET THERE WAS THAT WHEN WE COME BACK ON U S FARM REPORT

MARKETS NOW
ALL RIGHT TIME NOW FOR CLOSING THOUGHTS DAN, LET ‘S START WITH YOU WELL WE HAD DISCUSSED HIS TWO BIT EARLIER OF ME I REALLY THINK THIS IS NOT THE TIME FOR PRODUCERS TO PANIC YOU KNOW WHEN YOU LOOK AT RELATIVE VALUE WERE THE PRICES FOR CORN SOYBEANS WHEAT ANY OF THEM WERE DOWN TOWARDS WHAT HAS BEEN LOWS OVER THE LAST SEVERAL YEARS WHERE WE TEND TO FIND A VALUE IN THEIR SOME PEOPLE REFER TO THIS IS BEING IN THE WINTER SIDE OF THE MARK MARKET CYCLE WAS KIND OF THE THIS DRAWN OUT PERIOD WHERE IT ALMOST FEELS LIKE YOU’RE IN THE DESERT YOU CAN’T GET OUT OF IT BUT YOU WANT TO MOVE OUT A WINTER YOU’RE BACK INTO SPRING AND SPRING MEANS NEW GROWTH AND HIGHER PRICES ALL RIGHT THANK YOU DAN KEVIN, WHAT ‘S AMAZING IS THE KIND THE OBNOXIOUSNESS OF THE HEDGE FUND COMMUNITY HERE MANAGE MONEY THEY MANAGE IT WITH CRUDE OIL THEY STUCK WITH THE LONG SIDE FOR ALL WINTER LONG WE NEVER GOT A BREAK TO BUY FINALLY THE MARKET DIPPED TO THE COMMERCIAL ‘S ATTITUDE AND ENGRAINED RIGHT NOW IT ‘S A SIMILAR SITUATION WE DON’T KNOW HOW LONG THEY’LL KEEP SELLING BUT ONCE THEY CHANGE YOUR MIND THEN THINGS GET BETTER QUICKLY ALL RIGHT THANK YOU BOTH WE APPRECIATE IT STAY WITH US JOHN PHIPPS TALKS ABOUT CHINA NEXT

JOHN’S WORLD
SHOULD CHINA REALLY BE CONSIDERED A CURRENTLY MANIPULATOR? THAT’S THIS WEEK’S JOHN’S WORLD. THIS WEEK THE TRUMP ADMINISTRATION SURPRISED MANY OBSERVERS INCLUDING ME BY DECLINING TO DECLARE CHINA A CURRENCY MANIPULATOR. THIS IS ONE OF THOSE POLICIES THAT WE ALL THINK WE KINDA UNDERSTAND BUT PROBABLY DON’T, SO HERE’S AN AGSPLAINER. THE TERM CURRENCY MANIPULATOR IS AN OFFICIAL DESIGNATION FROM THE TREASURY DEPARTMENT THAT A COUNTRY IS RIGGING THE MARKETS FOR ITS CURRENCY. THE GUIDELINE IS SPENDING OVER 2% OF GDP - ECONOMIC OUTPUT - BUYING OTHER CURRENCIES AND SELLING THEIR OWN. THIS DRIVES DOWN THE VALUE OF THEIR CURRENCY AND MAKES EXPORTS FROM THEIR COUNTRY CHEAPER, BUT IMPORTS MORE EXPENSIVE. MANIPULATING CURRENCY CREATES WINNERS AND LOSERS AT HOME. PRESIDENT TRUMP HAD PROMISED TO DECLARE CHINA A CURRENCY MANIPULATOR MULTIPLE TIMES DURING THE ELECTION CAMPAIGN, EVEN THOUGH CHINA SINCE 2014 HAS BEEN SELLING ITS MASSIVE HOARD OF DOLLARS TO INCREASE THE VALUE OF THE YUAN - NOT LOWER IT. YOU CAN SEE THAT ON THIS GRAPH OF THEIR FOREIGN RESERVE HOLDINGS. REGARDLESS, ACCORDING TO THE CURRENCY ACT OF 2015, ONCE THE TREASURY DEPARTMENT DECLARES A COUNTRY A MANIPULATOR DURING ITS ANNUAL REVIEW, IT CAN PLACE 25% TARIFFS ON GOODS FROM THAT COUNTRY AFTER A YEAR OF NEGOTIATIONS TO RESOLVE THE PROBLEM. BUT THE PRESIDENT ALREADY POSSESSES THE POWER TO ENACT TARIFFS ON HIS OWN, SO THE DESIGNATION IS LARGELY SYMBOLIC. THAT SAID, COUNTRIES CAN BE EXTREMELY SENSITIVE TO SYMBOLIC ACTS, ESPECIALLY CHINA. OBVIOUSLY AVOIDING UNNEEDED TRADE FRICTION WITH CHINA IS GOOD FOR MANY SECTORS OF AG, ESPECIALLY PROTEINS AND SOYBEANS, SO THIS DEVELOPMENT SEEMS TO BE A STEP IN THE RIGHT DIRECTION. ON THE OTHER HAND, INDUSTRIES LIKE MANUFACTURING THAT WERE COUNTING ON A TOUGHER TRADE POLICY FROM THE NEW ADMINISTRATION ARE LESS PLEASED. THANKS, JOHN

TEASE
THOSE DEVESTATING WILDFIRES THAT RAGED ACROSS THE PLAINS LEFT A LASTING IMPACT ON FAMILIES AND RANCHES IN ITS PATH. BUT STANDING OUTSIDE THOSE FIRES, IF YOU’RE LOOKING FOR A WAY TO HELP, YOU’LL WANT TO STAY TUNED... WE’LL TELL YOU ABOUT A MILLION DOLLAR WILDIFRE RELEIF CHALLENGE COMING UP LATER ON TEH SHOW.

HEADLINES
WELCOME BACK TO U-S FARM REPORT. WEH AVE MUCH MORE AHEAD. IT’S A DAIRY DILEMMA IN WISCONSIN. AND WHILE HTE PRESIDENT IS BLAMING CANADA, OUR TRADING PARTNERS TO THE NORTH ARE PUSHING BACK. WILDFIRE RELIEF IS STILL UNDERWAY IN THE PLAINS, AND THERE’S A NEW CALL FOR HELP. WE’RE ON THE ROAD WITH MACHINERY PETE WHERE FOR DAIRY FARMERS IN WISCONSIN, IT’S ALL ABOUT QUALITY FEED AND EQUIPMENT. AND JOHN PHIPPS HAS WHAT HE CALLS BREAKING NEWS IN CUSTOMER SUPPORT. NOW FOR THE HEADLINES, LOAN VOLUME IS SKYROCKETING THE COUNTRY, AS FARMERS AND RANCHERS FACE ANOTHER MONTH OF DEPRESSED PRICES.

RURAL MAINSTREET INDEX
THE LATEST RURAL MAINSTREET INDEX OUT OF CREIGHTON UNIVERSITY SHOWS THE INDEX FALLING BELOW GROWTH NEUTRAL FOR THE 20TH STRAIGHT MONTH. THE AUTHOR OF THE INDEX ERNIE GOSS SAYS WEAK FARM COMMODITY PRICES CONTINUE TO SQUEEZE RURAL ECONOMIES, WITH LIVESTOCK PRICES FALLING NEARLY 6 PERCENT OVER THE PAST 12 MONTHS. GOSS SAYS IT’S LOAN VOLUME THAT’S SOARING AS BANKS AREN’T REJECTING AS MANY OF THOSE PRODUCERS APPLYING FOR A LOAN. <"OPERATING LOANS, EVEN THERE THE INTEREST RATES ARE RISING A BIT. IT’S NOT MUCH BUT THE QUALIFICATIONS ARE GETTING TOUGHER AND SO THERE ARE RISING RESTRICTIONS ON THE OPERATING LOANS."> ONE BANKER SURVEYED IN MINNESOTA TELLING THE R- M-I THEY ARE SEEING A LOT OF FARM AUCTION SALES IN THE LAST 6 MONTHS-- EITHER FROM FARMERS RETIRING OR THOSE GETTING OUT OF FARMING.

PERDUE CONFIRMATION MONDAY
AND WE COULD HAVE A NEW AG SECRETARY ON MONDAY. CONGRESS RECONVENES ON APRIL 24TH, AND IS SCHEDULED TO VOTE ON NOMINEE FORMER GEORGIA GOVERNOR SONNY PERDUE. THE VOTE IS SCHEDULED FOR 5:30 P.M. ON MONDAY. THE SENATE AG COMMITTEE CONFIMRED PERDUE ON MARCH 30TH.

WEATHER
METEOROLOGIST CINDI CLAWSON FILLING IN FOR MIKE HOFFMAN THIS WEEK. CINDI, DO YOU THINK THERE BE AT LEAST SOME WINDOWS WHERE FARMERS CAN PLANT THE NEXT 30 DAYS. WELL, TYNE WE’RE CERTINALY HOPING FOR THAT BUT I THINK WE’LL BE SEEING TIMES OF RAIN, YOU MIGHT BE ABLE TO GET OUT THERE A LITTLE BIT. BUT HOPEFULLY WE DON’T HAVE TOO SOGGY OF FIELDS. LET’S TAKE A LOOK AT THE JET STREAM WE’VE BEEN SEEING ZONAL FLOW KEEPING SYSTEM AFTER SYSMEM MOVING THROUGH CORN BELT AND THATS’ GOING OT CINTINUE FOR FIRST PART OF HTE WEEK. BUT WATCH AS WE SEE BIG TROPH DEVELOPING THROUGH WESTERN UNITED STATES WE MIGHT ACTUALLY SEE A BIT OF A COUTOFR LOW AS WE GET INTO NEXT WEEKEND, VERY WARM TEMPS IN EASTERN UNITED STATES. WE’LL HAVE TO WATCH SEE HOW STORMY THINGS GET TOWARD NEXT WEEKEND. AS FAR AS LONG RANGE WE’RE NORMAL TEMPS FOR GOOD CHUNK OF COUNTRY ESPECIALLY INE AST AND ON INTO SOUTHWEST, FAIRLY NORMAL TEMPS IN NORHTWEAST, AND FAR AS THAT PRECIP GOES, NOT REALLY ANY STRONG SIGNALS BUT IT LOOKS LIKE ABOVE NORMAL PRECIP IN GREAT LAKES AND INTO UPPER MIDWEST, FAIRLY NORMAL BUT OF COURSE THIS IS A RAINIER TIME OF YEAR FOR A LOT OF AREAS, ESPCIALLY WHERE WE ARE TRYING TO GET SOME PLAINTING DONE. TYNE

CANADA MILK STANDARDS HURTING U.S. PRODUCERS
THANKS, CINDI. PRESIDENT DONALD TRUMP VOWING TO HELP DAIRY FARMERS LEFT WITHOUT A HOME FOR THEIR MILK. “WE’RE ALSO GOING TO STAND UP FOR OUR DAIRY FARMERS IN WISCONSIN...(APPLAUSE)."> THE PRESIDENT SPEAKING IN WISCONSIN THIS WEEK, FIGHTING THE TRADE BATTLE WITH CANADA, PROMSING U-S DAIRY FARMERS THAT THE ADMINISTRATION WILL INTERVENE TO RESTORE EXPORTS OF AMERICAN MILK. HIS COMMENTS STEMMING FROM THE DAIRY DILEMMA IN WISCONSIN, WHERE GRASSLAND DAIRY DROPPED 75 FARMERS, SAYING IT’S BECAUSE CANADA CUT OFF HTE MARKET FOR ULTRA FILTERED MILK. TRADE GROUPS FOR U-S DAIRY FARMERS COMPLAINING SINCE CANADA’S POLICY ROLLED OUT THAT IT VIOLATES THE NORTH AMERICAN FREE TRADE AGREEMENT. UT JUST THIS WEEK, VANDIAN PRIME MINISTER JSTIN TRUDEAU TELLING BLOOMBERG IT’S NOT CANADA THAT’S THE CHALLENGE HERE” INSTEAD, HE’S BLAMING THE U-S, SAYING THERE’S A LARGE DAIRY TRADE SURPLUS WITH CANADA. THOSE 75 DAIRY FARMERS IN WISCONIN AND MINNESOTA HAVE BEEN RIDING A ROLLERCOASTER OF EMOTIONS SINCE EARLY APRIL. THAT’S WHEN GRASSLAND DAIRY GAVE THEM A 30 DAY NOTICE TO FIND A NEW HOME FOR THEIR MILK. I VISITED THE GARTMAN FAMILY DAIRY IN SHEBOYGAN, WISCONSIN. AND WHILE THEY RECEIVED THE BEST NEWS THIS WEEK... THAT A NEW PROCESSOR IS AGREEING TO TAKE THEM ON AND BUY THEIR MILK, I TALKED TO THE FAMILY BEFORE THEY GOT THAT NEWS AND EMOTIONS WERE STILL RAW... THOSE SAME EMOTIONS ARE PLAYING OUT ON DAIRIES ACROSS THE STATE STILL IN DESPERATE SEARCH FOR A NEW HOME. FOR THE GARTMANS... LET’S GOMILKING THESE 100 HEAD OF COWS IS THEIR LIVLIHOOD... AND IT’S ALWAYS A FAMILY AFFAIR... BUT THE FIRST WEEK OF APRIL, THEY FACED ONE OF THEIR BIGGEST FEARS... THEIR FATE IN THE FORM OF A LETTER... NOT EVEN MARKED AS URGENT. THEY FACED A SIMILAR OBSTACLE TWO YEARS AGO, WITH A PROCESSOR IN SHEBOYGAN. THAT HOME WAS GRASSLAND DAIRY, A PROCESSOR THEY HOPED TO HAVE FOR THE LONG-HAUL. VICE PRESIDENT OF BUSINESS DEVELOPMENT FOR GRASSLAND DAIRY TOLD FARM JOURNAL’S MILK THAT GRASSLAND RECIEVED A TWO-DAY NOTICE THAT THEIR CANADIAN MARKET WAS GONE... A DESITAINATION WORTH A MILLION POUNDS OF MILK A DAY. THEY SAID, QUOTE, WE ARE WORKING WITH OUR PATRONS TO FIND A HOME FOR THEIR MILK, BUT WE UNDERSTAND IT’S A CHALLENGE IN THESE MARKETS., . GOING ON TO SAY , THE LAST THING WE AS A COMPANY WANT IS TO LET FARMERS GO., BUT 75 DAIRY FARMERS RECEIVED THE SAME LETTER. WHILE A HANDFUL ALREADY FOUND A HOME, THE MAJORITY ARE LEFT WITH NO ANSWERS AS TO WHERE THEIR MILK WILL GO. 75 FARMERS IN WISCONSIN, THERE’S 9200 DAIRY PRODUCERS, SO IT’S A SMALL PERCENTAGE. TEH BIG PART IS IT’S A BIG ANXIETY FOR ALL PRODUCERS.> MIKE NORTH WITH COMMODITY RISK MANAGEMENT GROUP CALLING THE SITUATION UNPRECEDENTED. NORTH SAYS THIS DATES BACK TO GAT-- THE GENERAL AGREEMENT ON TRADE IN SERVICES FROM THE 90S. THAT’S WHEN CANADA DECIDED TO TAKE A PROTECTIVE STANCE ON ITS DAIRY INDUSTRY, CREATING A QUOTA SYSTEM. BUT SAYS CANADA ISN’T NECESSARILY TO BLAME. <. SOT HEY REALLY DIDN’T CVHANGE THEIR POSITION, THEY JUST CLEANED UP SOME OF THE LOOSE ENDS THAT EXISTED SINCE THAT POSITION WAS FIRST TAKEN. AND SO ULTIMATLEY I WOULDN’T BLAME THEM SO TO SPEAK, BUT AT THE SAME TIME, THEIR ACTION IS WHAT QUICKLY CAUSED THIS SCENARIO> WHILE SOME DAIRY GROUPS HOPE RENEGOTIATING NAFTA WILL HELP THE BLEEDING, THAT DOESN’T SOLVE THE ISSUE TODAY. NORTH SAYS THIS COULDN’T COME AT WORSE TIME, AS THE INDUSTRY FACES OVER SUPPLY WHILE FIGHTING THROUGH SPRING FLUSH WHERE THE COWS PRODUCE MORE. < I BELIEVE THAT IF THIS WHOLE AFFAIR WOULDN’T HAVE TAKEN PLACE IN APRIL BUT RATHER IN JULY, NONE OF THIS CONVERSATIONW OULD HAVE BEEN HAD> DAIRY FARMERS ARE SEEING PRICE PRESSURE ACROSS THE BOARD, AS THE LAST MONTH AND HALF, PRICES CONTINUED TO ERODE. IF THE GARTMANS HADN’T FOUND A HOME FOR THEIR MILK, THEY WOULD BE FORCED TO SELL THEIR COWS, BUT BY SECURING A NEW BUYER,IT’S RENEWING HOPE FOR THE FUTURE... AND INSTEAD OF THESE SIGNS AND STALLS BECOMING REMINATNS OF THEIR PAST, IT WILL REMAIN A PROMINENT PART OF THEIR FUTURE... OPENING A NEW DOOR FOR THE EIGHTH GENERATION. NOW DURING MY VISIT, SOME IN WISCONSIN SAY THIS IS JSUT ANOTHER EFFORT IN THE INDUSTRY TO WEED OUT THE SMALLER PRODUCERS. BUT MY SOURCES SAY THAT’S SIMPLY NOT TRUE... THAT GRASSLAND’S DECISION WAS BASED ON GEOGRAPHY, NOT SIZE.

TEASE
WHEN WE COME BACK, JOHN PHIPPS. I’VE GOT BREAKING NEWS

CUSTOMER SUPPORT
JOHN APPARENTLY HAS SOME BREAKING NEWS THIS WEEK.... OU CAN CUT THE EXCITEMENT WITH A KNIFE HERE AT CUSTOMER SUPPORT TODAY. THAT’S BECAUSE WE ARE INTRODUCING THE ALL NEW 2017 MODEL US FARM REPORT COFFEE MUG. TA-DA. THIS CRIMSON BEAUTY IS THE RESULT OF HOURS OF CAREFUL SELECTION WITH THOUGHTFUL ATTENTION TO DETAIL AND FASHION. AND DEFINITELY NOT AFFECTED BY WHAT WAS ON SALE AT THE TIME I ORDERED. WHILE IT IS BRILLIANT RED ON THE OUTSIDE, WITH THE HANDSOME US FARM REPORT LOGO, THE MUG IS PURE WHITE INSIDE. THIS FEATURE WILL HELP REGULAR USERS GAUGE HOW LONG IT HAS BEEN SINCE IT WAS CLEANED, OR POSSIBLY WASHED. AND IN A BREAKTHROUGH IN BEVERAGE CONTAINING TECHNOLOGY THE HANDLE ON THE 2017 MUG IS RECTANGULAR WHICH IS VERY COOL AND ALSO LOWERED THE PRICE ABOUT 50 CENTS. WITH THE NEW MUG, EVERYBODY IS ELIGIBLE, EVEN THOSE WHO HAVE PREVIOUSLY WON MUGS OR SUBMITTED QUESTIONS AND BEEN PROMISED A MUG THAT NEVER ARRIVED. SO SEND IN YOUR QUESTION, COMMENT OR CRITICISM TO MAILBAG@USFARMREPORT.COM, AND BE THE FIRST ONE IN YOUR NEIGHBORHOOD WITH THIS SCARLET TROPHY. JOHN, I THINK YOUR DEFINITION OF BREAKING NEWS AND MY DEFINITION OF BREAKING NEWS MAY BE A LITTLE DIFFERENT. BUT I DO LIKE THOSE MUGS! WELL, WHAT’S BEEN THE BIGGEST SURPRISE FOR MACHINERY PETE WHEN IT COMES TO EUQIPMENT TRENDS THIS YEAR? WE’LL HAVE THE ANSWER NEXT.

ON THE ROAD WITH MACHINERY PETE
2016 WAS PRODUCED A BOUNTIFUL HARVEST, SETTING THESE DAIRIES UP FOR A GOOD YEAR OF FEED. THAT FEED STARTS WITH PLANTING. BUT AFTER THAT, HARVEST IS KEY. BUT IT’S MORE THAN JUST THE SIZE OF THESE CHOPPERS THAT’S HELPIGN TO PRODUCE BETTER FEED... IT’S STRIVING FOR THE BEST QUALITY FEED POSSIBLE REALLY DRIVING EQUIPMENT TREND SIN THIS AREA. MACHINERY PETE SAYS THE USED CHOPPER MARKET IS AN INTERSTING ONE, SINCE THE BUYER POOL ISN’T AS BIG AS COMBINES OR TRACTORS. BUT EVEN THEN, HE SAYS IT’S QUALITY MACHINES BRINGING THE BIGGETS BUCK. IN WISCONSIN, IT’S MORE THAN JSUT LARGER MACHINES MOVING OFF THESE LOTS.