USFR Weekly Recap - October 7-8, 2017

RIVER BACKLOG
NOW FOR THE MARKET RELATED NEWS, DRY WEATHER AIDING IMRESSIVE HARVEST PROGRESS, BUT IT’S ALSO DRAINING MAJOR WATERWAYS. AND AS BARGE TRAFFIC BACKS UP, FARMERS ARE BEING ASKED TO STORE GRAIN. IT COULDN’T COME AT A WORSE TIME, AS FARMERS WORK TO HARVEST WHAT USDA THINKS IS THE THIRD LARGEST CORN CROP EVER. THE ISSUE IS ALONG THE MISSISIPPI, ILLINOIS AND OHIO RIVERS. LOW RIVER LEVELS MEANS BARGES ARE HAULING HALF TOW. U-S WATERWAYS COUNCIL SAYS PORTIONS OF THE OHIO RIVER ARE NOW CLOSED TO RIVER TRAFFIC, AT LOCK 52, LOCATED NEAR BROOKPORT, ILLINOIS THE U-S ARMY CORPS OF ENGINEER SAYS THEY AREN’T SEEING ANY MAJOR RIVER DELAYS ALONG THE MISSISSIPPI, BUT THAT’S NOT THE STORY FROM USDA AND GRAIN HANDLERS LIKE ADM. ADM REVEALING LAST WEEK THAT BARGE RATES SURGED, AS REPORTS INDICATE BARGES ARE ONLY ABLE TO HANDLE HALF NORMAL CAPACITY. NOW SOME FARMERS SAY THEY’RE BEING ASKED TO STORE THEIR GRAIN UNTIL THE ISSUE EASES. USDA REPORTING THOSE BARGE RATES ARE UP AS MUCH AS 50 PERCENT IN SOME AREAS. AND THEY EXPECT THIS TO CONTINUE THROUGH MID- OCTOBER.

CROP PROGRESS
ISSUES ON THE WATERWAYS BEING COMPOUNDED AS FARMERS ARE IN TEH HEAT OF HARVEST. CORN HARVEST IS NOW 17 PERCENT COMPLETE THAT’S 9 POINTS BEHIND THE FIVE YEAR AVERAGE. THE MAJOR CORN BELT STATES MOSTLY IN THE DOUBLE DIGITS BUT WELL BEHIND THE FIVE YEAR AVERAGE. ILLINOIS IS 17 POINTS BEHIND, IOWA 12, NEBRASKA 8 AND SOUTH DAKOTA 16 POINTS BEHIND. SOYBEAN HARVEST IS 22 PERCENT COMPLETE NATIONWIDE...THAT’S JUST A FEW POINTS OFF THE FIVE YEAR AVERAGE. OPPOSITE CORN BOTH ILLINOIS AND INDIANA ARE AHEAD OF AVERAGE AND COTTON HARVEST STANDS AT 17 PERCENT CUT. TEXAS IS A QUARTER DONE AND LOUISIANA IS NEARING THE HALFWAY MARK.

MILK PRICES
THE USDA ROLLING OUT IT’S SEPTEMBER CLASS THREE MILK PRICE THIS WEEK. AT 16-36 PER HUNDRED ITS DOWN MORE THAN 20 CENTS FROM THE AUGUST PRICE AND 3 CENTS LOWER THAN LAST YEAR. SO FAR THE CLASS THREE PRICE HAS AVERAGED 16-12 THIS YEAR. CLASS FOUR PRICES IN SEPTEMBER FELL 75 CENTS TO 15-86. FOR THE DAIRY INDUSTRY ATTENDING WORLD DAIRY EXPO THIS WEEK IN MADISON WISCONSIN, PRICES AND PROFITABILITY ARE TOP OF MIND. < THE NEXT 6 WEEKS, THERE IS SOME OPPORTUNITY HERE EVENTUALLY BUT BEYOND THAT, THE BIGGER PRODUCTION YOU POINT TOWARDS WILL LIKELY BE A DARK CLOUD OVER THE MARKET UNLESS OF COURSE EXPORTS BEGIN TO REALLY TAKE OFF.>

WEATHER
THOSE ARE THE HEADLINES...METEOROLOGIST MIKE HOFFMAN JOINS US NOW WITH WEATHER...MIKE, WE’VE HAD RAIN OFF AND ON HERE TODAY, BUT I KNOW MANY OF OUR VIEWERS SAW THE SAME THIS WEEK. DOES THAT PATTERN CONTINUE NEXT WEEK FOR THOSE TRYING TO HARVEST? TYNE, THE SHORT ANSWER IS NO I THINK THE PATTERN CHANGES THIS WEEK WE’LL SEE EVERYTHING MOVING FROM EAST TO OR FROM WEST TO EAST. WE WILL HAVE TO WATCH THE REMNANTS OF NATE THOUGH AND THAT’S SOMETHING WE’LL BE TRACKING FOR THE DROUGHT MONITOR SHOWING THE DRYER AREAS HAVE BEEN DEVELOPING IN THE EASTERN PORTIONS OF THE PLAINS STATES ESPECIALLY THE MISSISSIPPI VALLEY. THINGS HAVE GOTTEN BETTER IN MONTANA AND THE DAKOTAS LOOK AT A MONTH AGO IT WAS MUCH WORSE UP THERE. SO IT HAS CONTINUED TO IMPROVE BUT WATCH EXPAND THE AREA OF MODERATE DROUGHT AT LEAST PATCHES OF IT ACROSS PARTS OF THE SOUTHERN PLAINS INTO THE GREAT LAKES AREA. NOW TAKE A LOOK AT THE WEATHER MAP A DAY BY DAY. THIS IS THE REMNANTS OF NATE THAT MORE THAN LIKELY IS COMING UP INTO THE EASTERN PORTIONS OF THE COUNTRY EXACTLY WHERE THIS IS STILL PRETTY MUCH UP IN THE AIR DEPENDING ON THE TRACK THAT IT TAKES ACROSS THE GULF OF MEXICO. BUT A POSSIBILITY OF RAIN FOR THE EASTERN OHIO VALLEY SCATTERED SHOWERS AND THUNDERSTORMS IN THE EAST TO THE WEST THOUGH. JUST ONE SMALL SYSTEM IN COLORADO WITH A COUPLE OF SHOWERS AROUND IT. VERY LITTLE GOING ON. HERE’S THAT PATTERN CHANGE. DESPITE THAT WEAK SYSTEM IT COMES OUT OF COLORADO TOWARD THE GREAT LAKES THIS IS JUST SCATTERED LIGHT SHOWERS. THIS IS NOT MUCH MOISTURE. SCATTERED THUNDERSTORMS INTO THE SOUTHERN MISSISSIPPI VALLEY A LITTLE BIT OF RAIN AND SNOW IN WESTERN CANADA AND FRIDAY VERY LITTLE GOING ON. EVERY SYSTEM ON HERE IS PRETTY WEAK ALTHOUGH THE ONE IN THE PACIFIC NORTHWEST WILL HAVE SOME RAIN AND SNOW WITH IT AND MUCH COLDER AIR BEHIND IT. WE’LL CHECK OUR LONGER RANGE FORECAST IN OUR NEXT HALF HOUR.

TEASE
THANKS, MIKE. WHEN WE COME BACK, MORE THAN JSUT CORN AND SOYBEAN PRICES, OUR MARKETING ROUNDTABLE LOOKS AT THE MACRO PICTURE AND HOW THAT COULD IMPACT COMMODITY PRICES IN THE MONTHS AHEAD. CRAIG VANDYKE AND CHRIS NARARYAN JOIN US NEXT.

ROUNDTABLE 1
WELCOME BACK IN A SPECIAL EDITION OF U.S. FARM REPORT. CRAIG VANDYKE. AND TO TALK ABOUT THE MARKETS I MEAN HOW OFTEN DO YOU GET TO TALK ABOUT. PRICE. AND THE U.S. DOLLAR INDEX AT A LUKE BRYAN CONCERT. A FIRST TIME FOR THE FIRST TIME FOR HER. CRAIG LET’S START WITH YOU WHEN WE LOOK AT THIS PROTEIN SECTOR WE LOOK AT THIS GROWING SIZE. WE LOOK AT YOU KNOW WE LOOK AT CATTLE. YES. PRICES HAVE HELD UP FAIRLY WELL. DOES THAT SURPRISE YOU. NO IT DOESN’T. I MEAN WE’RE SEEING DEMAND IN THE MARKETS NOW OBVIOUSLY THAT DEMAND THERE’S THE EBB AND FLOW. YOU KNOW WE SAW BACK IN THE SUMMER PORK BELLY PRICES PACKERS WERE KILLING THE HOG JUST FOR THAT ONE CUT. WE’VE RECENTLY COME OFF A PRETTY DECENT SIZED BREAK FOR THE PAST TWO MONTHS IN STOCKS. THE HOG AND PIG REPORT SAYS WHICH NO ONE I THINK WAS SURPRISED THAT PLENTY OF MORE FOR NOMINAL DEMAND WE HAVE SEEN EXPORTS GROW LAST WEEK AND EXPORT SALES REPORT SO MAYBE THE LOWER PRICES ARE STARTING TO HURT SOME OF THAT FOREIGN TO ME. I MEAN IF WE CAN GET BELLY PRICES BACK TO A REASONABLE LEVEL MAYBE WE SEE FUTURES MAKE SOME GAINS AS WELL. I NOW THE TECHNICAL SIDE OF THE MARKET IS WHAT YOU LIKE TO WATCH THOUGH WHEN YOU LOOK AT THAT SPREAD AND SOME OF THE OTHER FACTORS ON THE CHARTS. WHAT ARE YOU SEEING RIGHT NOW THE MOST OBVIOUS RIGHT NOW IS THE CATTLE CATTLE SPREADS. I MEAN YOU SEE HOW WIDE THE OCT, DEC SPREAD IS. NOW WE’RE HEADED FIRST NOTICE DAY THIS NEXT WEEK. SO IT WOULD BE PRETTY TYPICAL TO SEE THAT SPREADS START TO NARROW UP. NOW WE KNOW WE’RE COMING UP INTO A LOT OF BEEF IN THE THE FOURTH QUARTER OF THIS YEAR COMING INTO THE SPRING. I KNOW THERE’S A LOT OF BULLISHNESS BUT WHEN YOU LOOK AT THE SPREADS RIGHT NOW THERE’S ALREADY A LOT OF BULLISHNESS BUILT IN THOSE BACK MONTHS THAT CONTRACT SO THE SPREADS ARE A LITTLE WIDE. MY CONCERN IS IF THE SPREAD FAILS THEN I THINK YOU’LL FIND FEEDER PRICES START TO STRUGGLE A LITTLE BIT. BUT RIGHT NOW FEEDER PRICES HAVE BEEN GOOD. OF COURSE WE’RE ALL YOU KNOW WE’RE KEEPING AN EYE ON THESE LIVE STOCK EXPORTS AND WHEN WE LOOK AT LIVESTOCK EXPORTS AND WE LOOK AT EXPORTS IN GENERAL WE ALWAYS TALK ABOUT THE U.S. DOLLAR INDEX. YET WHEN WE’VE SEEN THE DOLLAR STRONG YOU KNOW LIKE LAST YEAR, EXPORTS WERE STILL PRETTY IMPRESSIVE. SO CAN YOU MAKE THAT CORRELATION STILL TODAY AS WE SEE THAT DOLLAR COME OFF A LITTLE BIT. NO I MEAN YOU CAN BUT NOT IN THE WAY THAT MOST PEOPLE ARE USED TO. SO THE DOLLAR INDEX IS A VERY VERY NARROW INDEX. THERE’S THE GREAT THE BRITISH POUND THE EURO THE SWEDISH KRONOR THE CANADIAN DOLLAR AUSSIE DOLLAR THE JAPANESE YEN. AND SO WHEN YOU THINK ABOUT WHO YOU’RE COMPETING FOR WITH IN THE EXPORT MARKETS YOU KNOW TAKE CORN FOR EXAMPLE WHERE YOU KNOW IT’S A MUCH BETTER OR SOYBEANS FOR THAT MATTER WHERE IT’S MUCH BETTER LOOK AT THE U.S. DOLLAR VERSUS THE BRAZILIAN REALE OR THE ARGENTINE PESO. SO YOU CAN’T LOOK AT A NARROW INDEX LIKE THE DOLLAR INDEX AND THEN TRY TO BLOW THAT OUT TO SOME KIND OF EXPORT TREND FORECASTING SYSTEM. BUT WHY ARE WE SEEING PRESSURE ON THIS US DOLLAR INDEX TODAY. WELL YOU KNOW OBVIOUSLY THERE’S STILL A LOT OF UNCERTAINTY. YOU KNOW WE THINK THAT THE FED COULD PROBABLY RAISE RATES ONE MORE TIME THIS YEAR. AND YOU KNOW BUT WE’RE NOT SEEING THE INFLATION THAT WE’VE SEEN SO WE HAVE YOU KNOW PEOPLE IN THE MARKET ARE TRYING TO TIME IT AS BEST THEY CAN. IT’S GOING TO ADD A LITTLE BIT OF VOLATILITY, IT’S GOING TO ADD A LITTLE PRESSURE RIGHT NOW IN ANTICIPATION OF WHAT MAY OCCUR IN THE FUTURE. BUT IT MAY NOT YOU KNOW IT DOES HAPPEN IT MIGHT BE DECEMBER IT MIGHT BE MARCH. YOU KNOW WE JUST DON’T KNOW YET. SO YEAH, WE WE HEARD JANET YELLEN WITH THE FED TALK ABOUT A POSSIBLE ANOTHER INTEREST RATE HIKE YET YEAR YET, YOU KNOW WHEN I TALK TO YOU A COUPLE OF MONTHS AGO YOU WERE KIND OF UNCERTAIN IF WE WOULD SEE THAT THAT INTEREST RATE HIKE HAPPEN AGAIN THIS YEAR. SO WHAT’S CHANGED. HAS THE ECONOMY REALLY GOTTEN SO I MEAN WHAT SIGNAL WOULD TELL YOU THAT YEAH WE PROBABLY WILL SEE IT RATE HIKE. WELL I MEAN AND I’M NOT SAYING THAT WE WILL RIGHT. I SAY I CAN SEE ONE MAYBE. AND I’M STILL KIND OF ON THE FENCE WHERE WE WERE A COUPLE OF MONTHS AGO. WE CONTINUE TO SEE TOP LINE GROWTH. REVENUES ARE IMPROVING. YOU KNOW THAT’S WHY THE STOCK MARKET CONTINUES TO GRIND HIGHER. AND YOU KNOW WHEN WE ARE SEEING MORE DEMAND FOR FINISHED GOODS AND PRODUCTS. AND SO THAT OBVIOUSLY WILL UNDERPIN THAT DEMAND FOR COMMODITIES. BUT IT’S A LONG SLOW PROCESS SO I DON’T KNOW THAT WE NEED TO RAISE RATES BUT I THINK IF THEY REALLY WANT TO AND THEY SEE ENOUGH OF AN INFLATION THREAT THEY MIGHT YOU KNOW RAISE A LOT MORE TIME. ALL RIGHT CRAIG YOU KNOW WHEN WE TALK TO THE FED ABOUT MAKING SURE THAT YOU KNOW THEY’RE WATCHING MAKE SURE THAT OUR ECONOMY ISN’T OVERHEATED AND WE REALLY THOUGH WITH INTEREST RATES. WHAT ARE YOU WHAT IS OUR ECONOMIC PICTURE THAT GOOD RIGHT NOW. YOU KNOW THE FED HAS FAILED US FOR THE PAST 10 YEARS. SO NOW THEY’VE GOT A VERY BIG BALANCE SHEET TO TRY TO OUT WHY THEY NEED TO BE EXTREMELY CAUTIOUS IN DOING SO. AND YOU’RE SEEING THAT FROM THE FED. WE’VE SEEN THAT FROM THE FACT THAT YOU KNOW THE PAST TWO THREE YEARS HOW CAUTIOUS THEY’RE WILLING TO BE ON THE INTEREST RATE RISE. A QUICK SPIKE IS TOO MUCH VOLATILITY WHICH IS WHAT I DON’T WANT TO SEE. SO YOU KNOW I THINK YOU’LL CONTINUE TO SEE PATIENTS FROM THEM UNTIL THEY FEEL COMFORTABLE MAKING MOVES THAT THEY WANT TO MAKE. WELL WE’VE SEEN THAT WE CONTINUE TO HIT NEW HIGHS WITH THE STOCK MARKET YOU KNOW. AND IS IT OVERHEATED AND POSSIBLY COULD WE SEE THAT MONEY FLOW INTO COMMODITY MARKETS LIKE I KNOW A LOT OF ANALYSTS HAVE HAVE WANTED TO SEE. I’M GOING TO ASK CRAIG AND CHRIS THAT QUESTION WHEN WE COME BACK ON U.S. FARM REPORT SO DON’T GO ANYWHERE.

ROUNDTABLE 2
WELCOME BACK A LITTLE BIT OF A BACKGROUND NOISE FOR YOU AS THEY PREPARE AND GET READY FOR THE CONCERT FOR THIS MARKETING ROUNDTABLE. BUT CRAIG STARTING WITH YOU WE TALKED ABOUT THE U.S. DOLLAR INDEX. WE TALKED ABOUT INTEREST RATES YOU KNOW DO YOU EXPECT ANY OF THAT TO HAVE AN IMPACT ON COMMODITY PRICES? YOU KNOW THAT TYPE OF IMPACT IS GOING TO TAKE SOME TIME. IF IT’S GOING TO COME AT THE END OF THE COMMODITY MARKETS HAVE A JOB TO DO WHETHER IT’S TO GROW SUPPLY, RATION DEMAND, COMMODITY MARKETS HAVE A JOB TO DO. CASH FLOWS WILL COME AND GO. AND MAYBE SOME VOLATILITY WILL COME ABOUT SHOULD THE U.S. DOLLAR GET A LITTLE BIT MORE VOLATILE. BUT IN REALITY THE BIGGER PICTURE IS THAT THOSE SMALL TERM BLIPS MAYBE BECAUSE OF INTEREST RATE CHANGES OR U.S. DOLLAR MOVEMENT OR EXCHANGE RATE MOVEMENTS SHOULD PROBABLY BE CAPTURED IN THE SHORT TERM. IF WE GET ANY SORT OF MOVEMENT BECAUSE OF THOSE REASONS. CHRIS WHEN WE LOOK AT THE STOCK MARKET YOU KNOW EVERY HEADLINE STOCK MARKET HITS A NEW A NEW RECORD HIGH A NEW RECORD HIGH I MEAN WE CONTINUE TO BREAK THESE RECORDS. AND THIS HAS BEEN GOING ON FOR QUITE SOME TIME. BUT AT THIS POINT DO YOU THINK THE STOCK MARKET’S OVERHEATED. IS IT OVERDONE? NO YOU KNOW I DON’T THINK IT IS OVERHEATED. I MEAN OBVIOUSLY THERE’S A LOT OF PEOPLE WHO ARE WANTING TO CALL THE TOP OF SOME POINT SOMEBODY IS GOING TO GET IT RIGHT. BUT YOU KNOW AT THE END OF THE DAY WHEN YOU LOOK AT WHERE WE ARE, WE’RE SEEING NOT JUST EARNINGS GROWTH. YOU KNOW IN THE FORM OF COST CUTTING, BUT WE’RE SEEING REVENUE GROWTH TOP LINE. SO YOU KNOW WE’RE SEEING MORE YOU KNOW MORE INCREASING DEMAND FOR GOODS AND SERVICES AND PEOPLE ARE SPENDING MORE MONEY. AND ALSO WHEN YOU LOOK AT WHERE THE STOCK MARKET IS, IF YOU LOOK AT THE ANALYST ESTIMATES FOR EARNINGS OVER THE NEXT 12 MONTHS, YOU KNOW AND THEN YOU PROJECT THAT AS A MULTIPLE ON THE VALUE OF THE STOCK MARKET, YOU KNOW WE’RE A LITTLE BIT ABOVE AVERAGE BUT NOT YOU KNOW GROSSLY SO. I MEAN OBVIOUSLY A LOT OF PEOPLE LOOK AT THE LAST 12 MONTHS AND YES WE ARE MUCH HIGHER THAN THAT BUT THAT’S IN THE PAST. SO GOING FORWARD IF THESE ESTIMATES ARE EVEN HALFWAY CORRECT, YOU KNOW WE’RE YOU KNOW WE’RE A LITTLE BIT HIGHER THAN NORMAL BUT I MEAN WE’RE NOT ANYWHERE CLOSE TO LIKE YOU KNOW WHAT WE WOULD CALL A HUGE TOP OR FROTHY ENVIRONMENT. BUT AT SOME POINT. COULD THOSE INVESTORS COULD WHO COULD WE SEE SOME OF THAT MONEY SPILL OVER INTO THE COMMODITY SECTOR? YOU KNOW THAT’LL TAKE SOME TIME YOU KNOW TO CRAIG’S POINT EARLIER. YOU KNOW IF WE SEE INTEREST RATES RISING YOU KNOW OBVIOUSLY INCREMENTALLY I MEAN WE’RE AT LOW LEVELS RECORD LOW LEVEL SO I MEAN WE’RE NOT TALKING ABOUT HUGE INTEREST RATE INCREASES. HOWEVER THAT DOES TAKE SOME OF THE EARNING POTENTIAL OUT OF THE COMPANIES AND YOU MIGHT SEE A LITTLE BIT OF PROFIT TAKING YOU COULD SEE A YOU KNOW KIND OF A REDISTRIBUTION OF ASSETS BACK INTO THE BOND MARKET OR EVEN INTO THE COMMODITIES MARKET. BUT I THINK WHAT’S REALLY GOING TO BUOY THE COMMODITIES MARKET IS WHAT WE HAVE TO SEE JUST CONTINUED GROWTH CONTINUED DEMAND. AND SO YOU KNOW WE NEED MORE DEMAND FOR THESE COMMODITIES THAT’S WHAT’S REALLY GOING TO SAVE IT. BUT IN ADDITION TO DEMAND, I MEAN WE’VE SEEN IMPRESSIVE DEMAND FOR SOME OF THESE SECTORS WHAT IS IT GOING TO TAKE FOR US REALLY TO SEE COMMODITY PRICES START ON A LARGE UPTICK I MEAN YOU KNOW IF WE CAN’T POINT TO NECESSARILY WEAKENING U.S. DOLLAR OR YOU KNOW INTEREST RATES WHAT IS IT GOING TO TAKE CRAIG? I WISH I HAD THAT ANSWER. WE ALL DO. RIGHT. BUT AT THE END OF THE DAY I THINK YOU NEED TO LOOK FOR SIGNS THAT MAYBE SOMETHING IS COMING ABOUT. YOU KNOW YOU LOOK AT THE SPREADS RIGHT NOW IN THE CORN MARKET YOU KNOW DEC CORN TRADING AT A LARGE CARRY 46 47 CENTS. YOU NEED TO RECOGNIZE IF WE GET SMALL BLIPS IN THE MARKET SMALL UPS IN THE MARKET AND THE SPREADS DON’T MOVE AT ALL. TO ME THAT’S A SIGN THAT THE MARKET NEEDS TO BE SOLD. THE MARKET NEEDS TO BE SOLD. NOW IF WE START TO SEE A CHANGE IN TREND WHERE THE SPREADS START TO TURN, THEN MAYBE WE CAN SEE MORE EXCITEMENT. WHAT WILL WHAT WILL GROW THAT? I MEAN RIGHT NOW I DON’T THINK ANYBODY KNOWS SOME TYPE OF BLACK SWAN EVENT YOU KNOW ISSUE BRAZIL SOMETHING OUT OF THE BLUE. BUT RIGHT NOW THERE’S NOTHING IN THE FORESEEABLE FUTURE THAT SAYS YOU KNOW THIS MARKET NEEDS TO RALLY. IN THE SHORT TERM WHICH COMMODITY SECTOR IN THE GREAT AND LOOK AT GRAIN SOYBEANS WE WHICH ONE OF THOSE SECTORS DO YOU THINK HAS THE BEST CHANCE OF SEEING BETTER PRICES? BUT I THINK IF WE LOOK ACROSS THE BOARD THE SPREADS ARE TERRIBLE AND CORN AND WHEAT SOYBEANS IS THE MARKET THAT I IF I WANT TO BE FRIENDLY, EVEN THOUGH I DO THINK YOU KNOW THIS YEAR HAS BEEN A TESTAMENT TO WHAT FARMERS CAN DO AS FAR AS FARM MANAGEMENT WE THREW EVERYTHING AT THIS MARKET AS FAR AS WEATHER GOES. AND FROM THE YIELDS I’M ALREADY HEARING THE WAY THINGS ARE LOOKING IT’S IT’S UNBELIEVABLE WHAT WE’VE BEEN ABLE TO DO WITH THE TECHNOLOGY NOW. SO UNBELIEVABLE AS IN LIKE MAYBE USDA ISN’T THAT FAR OFF. AS OF RIGHT NOW IT LOOKS TO BE THAT WAY. SO I MEAN I LIKE CARRYING BEANS IN THE SPRING. I LIKE SELLING CORN NOW AND WE SEE IT BRAZIL HAS SOME SORT OF ISSUE TO HELP US FORWARD. AT THE SAME TIME THOUGH WE’VE HAD REALLY LOW VOLATILITY IN THESE MARKETS RIGHT? I MEAN HOW LOW A RECORD LOW VOLATILITY. WE’RE SEEING RECORD LOW VOLATILITY. YOU KNOW VOLATILITY CREATES OPPORTUNITY SO WE HAVEN’T SEEN SOME OF THAT OPPORTUNITY THAT WE NORMALLY WOULD. WHAT IS YOUR ADVICE FOR SOME OF THESE FARMERS TO THINK MORE LIKE A TRADER LOOK AT THE MACRO. YOU KNOW REALLY TAKE A STEP BACK AND MANAGE THEIR FARM THE BEST WAY POSSIBLE LOOKING AT THE LOW VOLATILITY THAT WE’VE BEEN GIVEN? YOU KNOW AND I’M GOING TO GO TO MY FRIEND PETE MEYER HE MADE AN EXCELLENT POINT A COUPLE OF MONTHS AGO ABOUT MANAGING YOUR BALANCE SHEET BECAUSE YOU KNOW TIMES ARE TOUGH RIGHT NOW. NOW YOU KNOW NOW’S THE TIME TO SIT THERE AND WORRY ABOUT YOU KNOW WHAT EVERYBODY ELSE TO DO AND YOU’VE GOT TO MANAGE YOUR OWN OPERATION YOU’VE GOT TO GET THAT. ESPECIALLY IF WE ARE BECAUSE WE WILL BE IT IN A HIGHER INTEREST RATE ENVIRONMENT IN THE FORESEEABLE FUTURE WE JUST DON’T KNOW QUITE WHEN AND WE KNOW IT’S GOING TO CONTINUE. YOU KNOW IT’S GOING TO BE A TREND OVER THE NEXT COUPLE OF YEARS. SO NOW IS THE TIME WITH CHEAP MONEY TO REALLY GET YOUR BOOKS IN ORDER BECAUSE YOU KNOW WHAT VOLATILITY WILL COME BACK AT SOME POINT WHETHER IT’S SUPPLY SHOCK OR SOME KIND OF A BLACK SWAN FINANCIAL CRISIS. BUT FOR NOW YOU HAVE TO BE PREPARED. NOW’S THE TIME TO DO IT. GOOD ADVICE. ALL RIGHT. THANK YOU BOTH. WE NEED TO TAKE ANOTHER QUICK BREAK. WHEN WE COME BACK WE’LL GET THE CLOSING THOUGHT . DON’T GO ANYWHERE.

MARKETS NOW
ALL RIGHT TIME NOW FOR CLOSING THOUGHTS DESPITE BEING AT THE LUKE BRYAN CONCERT I’M NOT GOING TO ASK YOU YOUR FAVORITE LUKE BRYAN SONG. WE’LL STICK TO THE MARKETS CLOSING THOUGHTS. CRAIG WE’LL START WITH YOU. YOU KNOW THERE’S A LOT OF QUESTION RIGHT NOW AS TO SHOULD I SELL CORN SHOULD I STORE COURSE SELL BEING SHOULD I STORE BEANS. WHERE IS THIS MARKET HEADED. YOU KNOW I THINK RIGHT NOW ONE THING THAT I WANT I WOULD WANT GUYS TO BE PAYING ATTENTION TO, LIKE I SAID EARLIER IS THE SPREAD IS NARROWING. IF WE START TO SEE SPREADS NARROW THEN MAYBE WE HAVE A LITTLE BIT OF SIGNS OF LIFE. BUT IF YOU’RE GOING TO STORE GRAIN, YOU NEED TO CAPTURE THAT CARRY. THE WAY TO CAPTURE IT IS TO SELL IT OUT WHEN YOU’RE GOING TO WHEN YOU’RE GOING TO SELL. ALL RIGHT CHRIS. YOU KNOW I’VE BEEN SAYING THIS IS KIND OF WHAT I CALL A BARBECUE MARKET, LOW AND SLOW. YOU KNOW WITH SLOW GROWTH LOW VOLATILITY. YOU KNOW IT USED TO BE BECAUSE OF LOW INTEREST RATES PEOPLE WERE POURING MONEY INTO THE STOCK MARKET AND THEN WE STARTED SEEING EARNINGS RISE, AND THEN WE STARTED SEEING TOP LINE REVENUE RISE. AND SO THAT CONTINUE TO GO. EVENTUALLY THAT’S GOING TO REVERSE ITSELF WE’RE GOING TO START SEEING A REALLOCATION OF ASSETS SO I THINK BE MINDFUL OF WHAT’S GOING ON AND PAY ATTENTION. ALL RIGHT. THANK YOU FOR BEING HERE. A NICE BACKDROP THIS WEEK I APPRECIATE THE INSIGHT THANKS FOR HAVING US. YEAH THANK YOU. STAY WITH US TO A DIFFERENT BAR. THAT’S JOHN FARM NEXT ON U.S. FARM REPORT.

JOHN’S WORLD
WITH RAIN FALLING ACROSS MUCH OF HTE U-S THIS WEEK, SOME OF YOU REALLY NEEDED IT. THAT INCLUDES JOHN PHIPPS. THERE HAVE BEEN MANY YEARS I HAVE ANXIOUSLY AWAITED DRY WEATHER TO GET HARVEST UNDERWAY OR BACK ON TRACK. THERE HAVE EVEN BEEN A FEW THAT ARE SEARED IN MY MEMORY WHERE MUDDY RUTS SCARRED OUR FIELDS AND CROPS WERE FINALLY HARVESTED THE FOLLOWING YEAR. BUT THIS ONE HAS TO TAKE THE CAKE FOR JUST THE OPPOSITE. NOT ONLY HAVE WE NOT HAD A SINGLE RAIN-OUT DAY, WE’VE BARELY HAD ANY DEW OR FOG. WE’RE GOING ON THREE MONTHS WITH LESS THAN A HALF- INCH OF RAIN THROUGHOUT. CREEKS ARE DRY, AND WELLS ARE FAILING. THE GROUND FEELS LIKE CONCRETE. NOW ADD IN RECORD WARMTH DURING SEPTEMBER, CROP MOISTURE LEVELS BELOW ANYTHING I’VE SEEN THAT WASN’T A DRYER FAILURE, AND NO DAYS OFF TO GET TO MY RAINY-DAY JOBS DONE AND 2017 IS LOOKING LIKE ONE FOR THE BOOKS. I’M NOT EVEN SURE THE THRILL OF FINISHING EARLY WILL BE THAT EXCITING. THIS I STARTING TO SMELL LIKE A DROUGHT. YOU CAN SEE THE TAN ON THE DROUGHT MAP CREEPING ACROSS MY PART OF THE MIDWEST. MEANWHILE, WE’RE ALL KEENLY AWARE OF ANY SMOKE ON THE HORIZON. MORE THAN A FEW OF US HAVE TILLAGE IMPLEMENTS READY TO BATTLE A FIELD FIRE. SECRETLY, A FEW OF US REMEMBER WITH NOSTALGIA NOW THOSE FEW HURRICANES THAT WANDERED FAR ENOUGH INLAND TO DUMP INCHES ON OUR FARM DURING THE FALL. BUT AS BAD AS WE NEED MOISTURE, I SURE WOULDN’T WANT THOSE OTHERS IN THE PATH TO EXPERIENCE ANY MORE MISERY. IT WOULD BE NICE TO HAVE A GUILT-FREE DAY OFF TO CATCH UP THE BOOKS AND REPAIR TEMPORARY PATCHES, BUT I THINK I’M GOING TO HOPE FOR A WARM WET WINTER JUST IN CASE. THANKS, JOHN.

TEASE
STILL TO COME, WHY IS A NATIONAL COUNTRY MUSIC STAR TAKING TO THE STAGE TO PROMOTE FARMERS? WE SIT DOWN WITH LUKE BRYAN NEXT.

HEADLINES
WELCOME BACK TO THIS SPECIAL EDITION OF U-S FARM REPORT. IF YOU’RE JUST NOW JOINING US, WE PARTED WAYS WITH OUR STUDIO FOR HTE WEEK, INSTEAD, BRINGING YOU THE SHOW FROM THE LUKE BRYAN FARM TOUR... AND WE HAVE A JAM PACKED 30 MINUTES. TOASTING TO THE AMERICAN FARMER. WHY LUKE BRYAN IS USING A NATIONAL STAGE TO LIFT UP FARMERS WHILE GIVING BACK WITH THE HELP OF ONE AG COMPANY. FARMERS HAVE STAGNANT VIEWS ON THE FARM ECONOMY. BUT LONG-TERM OUTLOOKS ARE STARTING TO WANE. AND DIGGING INTO NO-TILL... JOHN PHIPPS KICKS OFF A TILLAGE SERIES IN CUSTOMER SUPPORT.

PURDUE AG BAROMETER
NOW FOR THE HEADLINES...AS FARMERS RUSH TO THE FINISH LINE WITH THE 2017 CROP, SENTIMENTS ABOUT THE AG ECONOMY APPEAR TO BE HOLDING STEADY. HOWEVER THE LATEST AG ECONOMY BAROMETER FROM PURDUE AND THE CME RAISING QUESTIONS ABOUT HOW CONFIDENT THEY ARE IN THE FUTURE OUTLOOKS. THE SEPTEMBER BAROMETER POSTING A 132. THAT’S THE SAME AS AUGUST. AND IT FALLS WITHIN THE RANGE OF THE BAROMETER OVER THE PAST 6 MONTHS... STAYING BETWEEN 130 AND 139. BUT, THE 132 MARK IS STILL WELL BELOW THE PEAK OF 153 FROM LAST JANUARY. BUT THE INTERESTING THING WHEN YOU LOOK AT IT, EVEN THOUGH WE HAD NO CHANGE IN THE BAROMETER ITSELF. YOU DID SEE SOME CHANGES IN THE UNDERLYING SUB-INDECIES. THE INDEX OF CURRENT CONDITIONS AND THE INDEX OF FUTURE EXPECTATIONS. IN PARTICULAR IT WAS INTERESTING TO NOTE THAT WE’VE SEEN A FAIRLY SHARP DROP OFF IN THE INDEX OF FUTURE EXPECTATIONS MEANING PRODUCERS HAVE LOST SOME CONFIDENCE THAT THEY HAD ON WHERE THE AG ECONOMY WAS HEADED.

USDA CONFIRMATIONS
IN WASHINGTON, THE SENATE CONFIRMING TWO KEY USDA NOMINATIONS THIS WEEK.. POSTS LEFT UNFILLED FOR 9 MONTHS. STEPHEN CENSKY CONFIMRED AS AS DEPUTY SECRETARY OF AGRICULTURE, AND TED MCKINNEY AS UNDERSECRETARY OF AGRICULTURE FOR TRADE AND FOREIGN AGRICULTURAL AFFAIRS.. THE ACTION FOLLOWED UNANIMOUS APPROVAL A DAY EARLIER BY THE SENATE AGRICULTURE COMMITTEE. PERDUE HAS BEEN THE LONE CONFIRMED USDA APPOINTED OFFICIAL SINCE HIS CONFIRMATION VOTE BACK IN THE SPRING. <. IT’S NOT THAT THEY HAVEN’T BEEN WORKING BEHIDN THE SCENES. NOT BEING FORCED OR WITH THE DAY TO DAY MEETING, THEY’VE BEEN ABLE PROBABLY TO FOCUS ON THE PRIORTY ITEMS THAT THEY’RE GOING TO DEAL WITH SO THEY CAN HIT HTE GROUND MORE THAN RUNNING. SO THERE’S THE SILVER LINING FOR YOU>

IOWA LAND VALUES
IOWA LAND VALUES SEEING LIFE, GAINING FOR THE FIRST TIME IN THREE YEARS. OUR PARTNERS AT LANDOWNER NEWSETTER REPORTING IOWA FARMLAND VALUES ROSE 2 PERCENT FROM 6 MONTHS AGO. THOSE VALUES LARGELY DEPENDENT UPTON MOISTURE. A SEMIANNUAL SURVEY FROM IOWA CHAPTER OF THE REALTORS LAND INSTITUTE REVEALING LAND VALUES SAW STRONGER GAINS IN THE CENTRAL TO EASTERN AREAS ABOVE I-80, MAINLY DUE TO SUMMER RAINS. BUT WHERE DRY WEATHER SET IN ACORSS THE WESTERN THIRD OF THE STATE, LAND VALUES SAW SMALLER GAINS.

NUT-BASED MILK DEBATE
THE FIGHT OVER WHETHER NUT BASED MILK IS REALLY MILK CONTINUES. THE NATIONAL MILK PRODUCERS FEDERATION URGING FEDERAL FOOD REGULATORS TO LOOK INTO BLUE MAGIC CASHEW MILK, SENDING A LETTER TO BOTH FDA AND THE CALIFORNIA DEPARTMENT OF AGRICULTURE. N-M-P-F CLAIMING THE PRODUCT IS AN IMITATION DAIRY DRINK USING THE WORD MILK, BUT IT’S A PLANT BASED PRODUCT MADE FROM NUTS AND WATER. THE FEDERATION SAYS THAT VIOLATES CURRENT GOVERNMENT STANDARDS THAT DEFINES MILK AS A PRODUCT FROM A DAIRY ANIMAL. THIS IS THE SECOND TIME N-M-P-F RAISED ITS CONCERNS OVER BLUE MAGIC CASHEW MILK.

WEATHER
THAT’S IT FOR NEWS...METEOROLOGIST MIKE HOFFMAN JOINS US NOW WITH THE NATIONAL FORECAST. MIKE, BALMY WEATHER TO FINISH OUT SEPTEMBER AND START OCTOBER. HOW LONG CAN IT LAST? WELL TYNE, IT LOOKS LIKE IN GENERAL IT LASTS FOR ANOTHER WEEK. THERE WILL BE PLACES IN THE NORTHERN PORTIONS OF THE COUNTRY THAT DOES GET COLD FOR SHORT PERIODS OF TIME. THERE IS OUR JETSTREAM SHOWING A SHOT OF CHILLIER AIR INTO THE WEST AGAIN BUT THIS RIDGE HOLDS IN THE SOUTHEAST SO ANY COOL AIR YOU GET IN THE NORTHERN TIER OF STATES AND THE GREAT LAKES IN THE NORTHEAST DOESN’T LAST LONG. YOU CAN SEE LITTLE TROUGHS MOVING FROM WEST TO EAST. NO MAJOR TROUGHS COMING IN WHICH MEANS MOST OF THE LOWER 48 IS FAIRLY DRY THIS WEEK OVERALL. AND THEN AS WE HEAD INTO NEXT WEEKEND A LITTLE BIT OF COOL DOWN IN THE NORTHWEST BUT THAT’S ABOUT IT. THAT’S A WARM WEATHER PATTERN FOR THIS TIME OF THE YEAR. SO 30 DAY OUTLOOK FOR TEMPTERS I’M GOING ABOVE NORMAL FOR THE EASTERN HALF OF THE COUNTRY BELOW NORMAL FOR THE INTERIOR CENTRAL AND NORTHERN ROCKIES. PRECIPITATION OVER THE NEXT 30 DAYS AND GOING ABOVE NORMAL FOR THE NORTHERN AND CENTRAL PLAINS STATES BELOW NORMAL THEN FROM NORTHEAST TEXAS UP THROUGH THE TENNESSEE AND OHIO VALLEY INTO MOST OF THE NORTHEAST. TYNE. THANKS, MIKE.