Thursday May 17 Ag News

CME Group Introduces New CBOT Grain and Oilseed Trading Hours in Support of Grain Industry Participants
CME Group, the world's leading and most diverse derivatives marketplace, today announced measures to help farmers, ranchers and commercial market participants prepare to transition to expanded electronic trading hours for CBOT grain and oilseed futures and options on CME Globex. CME Group will now offer expanded market access to a variety of CBOT futures and options 21 hours per day, pending CFTC certification. 

"What sets CME Group apart is our close working relationship with the grain industry, who have made our grain and oilseed futures the benchmark risk management products," said Tim Andriesen, Managing Director, Agricultural Commodities and Alternative Investments, CME Group. "That's why, in response to significant feedback for this customer segment, we're further amending CBOT grain and oilseed trading hours to 5 p.m. to 2 p.m. CT Sunday through Friday. They have clearly communicated that these hours best meet their risk management needs."

These measures are in part the result of collaboration between CME Group, the National Grain and Feed Association (NGFA) and the North American Export Grain Association (NAEGA) to address these changes and help the grain industry prepare for the transition.

"This action by the CME Group demonstrates the value of collaboration between the exchange and users of futures and options markets who rely heavily on the CBOT contracts to hedge marketplace risk," said Randall C. Gordon, acting president of the National Grain and Feed Association. "This important change will provide time during normal business hours for grain, feed and grain processing operations and other merchants to reconcile their trading accounts and perform other required accounting and back-office operations without incurring the significant additional expense of hiring or providing overtime to employees performing these important functions."

"We commend the CME Group for making this change before implementing its expanded electronic trading hours," Gordon added.  "We look forward to continuing to discuss with the CME Group, other exchanges and other parties possible ways to address industry concerns about USDA reports being released during market hours."

Electronic trading hours for CBOT Corn, Mini-Sized Corn, Soybeans, Mini-Sized Soybeans, Wheat, Mini-Sized Wheat, Soybean Meal, Soybean Oil, Rough Rice, Oats, and Ethanol futures and options plus all related calendar spread options and inter-commodity spread options will be extended to Sunday to Friday, 5:00 p.m. to 2:00 p.m. CT. 

Daily settlements will continue to be based on market activity at or around 1:15 p.m. CT each day. Additionally, open-outcry trading hours will continue to operate from 9:30 a.m. to 1:15 p.m. CT Monday to Friday.



KCBT Revises Modifications to HRW Wheat Futures & Options Electronic Trading Hours

The Kansas City Board of Trade announces a modification to the previously announced expansion of electronic trading hours for the KCBT’s flagship hard red winter wheat futures and options contracts.

In coordination with the CME Group®, the KCBT has withdrawn its earlier submission with the CFTC for extended trading hours and filed a new rule submission setting forth daily (Sunday through Friday) extended electronic trading hours of 5:00 pm to 2:00 pm CT for Hard Red Winter Wheat futures and options.

The effective date of the new extended trading hours will be coordinated with and announced by CME Group®.

Daily settlements will continue to be based on the 1:15 p.m. CT close each day.

Wheat futures and wheat options will continue to trade by open outcry from 9:30 a.m. to 1:15 p.m. CT Monday through Friday.



Irrigation load control earlier than usual

Cuming County, Southern, and Dawson County Public Power districts are alerting their irrigation customers to the potential for load management control this week. Dawson spokesperson Marsha Banzhaf says load management usually begins in June. However, electric loads are rising as more irrigation wells are being used early in the growing season. A news release from Southern Power District says that they've seen their energy loads rapidly increasing each day with the dry weather being experienced this month.  Cuming County Public Power Customer Service Representative Nicki Peters says this will be an issue in eastern Nebraska as well.



LEAD Fellowship Applications Available for Group Thirty-two

Fellowship applications for Nebraska LEAD (Leadership Education/Action Development) Group 32 are now available for men and women involved in production agriculture or agribusiness.  "Up to 30 motivated men and women with demonstrated leadership potential will be selected from five geographic districts across our state," said Terry Hejny, Nebraska LEAD Program director.

In addition to monthly three-day seminars throughout Nebraska from mid-September through early April each year, Nebraska LEAD Fellows also participate in a 10-day National Study/Travel Seminar and a two week International Study/Travel Seminar.

Seminar themes include leadership assessment and potential, natural resources and energy, agricultural policy, leadership through communication, our political process, global perspectives, nuclear energy, social issues, understanding and developing leadership skills, agribusiness and marketing, advances in health care and the resources and people of Nebraska's Panhandle, Hejny said.

The Nebraska LEAD Program is designed to prepare the spokespersons, problem-solvers and decision makers for Nebraska and its agricultural industry. In its 31st year, the program is operated by the Nebraska Agricultural Leadership Council, a nonprofit organization, in collaboration with the University of Nebraska's Institute of Agriculture and Natural Resources and in cooperation with Nebraska colleges and universities, business and industry, and individuals throughout the state.

Applications are due no later than June 15 and are available via e-mail from the Nebraska LEAD Program. Please contact Shana at sgerdes2@unl.edu. You can also request an application by writing Room 318 Biochemistry Hall, University of Nebraska-Lincoln, 68583-0763 or by calling (402) 472-6810. You can visit www.lead.unl.edu for information about the selection process.



Nebraska Corn Board hosts E15 meetings

The Nebraska Corn Board hosted meetings for E15 stakeholders in Lincoln and Kearney recently.  Approximately 75 ethanol producers, fuel retailers, petroleum marketers, ethanol industry personnel, agriculture commodity groups, and other stakeholders attended these informational meetings.

Robert White, director of market development from the Renewable Fuel Association, was the presenter.  He gave an overview of the next steps needed to offer E15, a blend of 15 percent ethanol, at the fuel pump.  This included information on health effects data, misfueling mitigation plan, fuel survey, and consumer efforts.  In addition, White also discussed incentives to assist with installing blender pumps.

“There is a lot of misinformation about E15 such as requirements for ethanol plants and fuel retailers that is coming from various sources.  This meeting was necessary to get the right information to the right people,” said White.  “We want to see E15 introduced legally and safely.”

Curt Friesen, District 3 Director on the Nebraska Corn Board, said, “It is crucial that all the necessary steps are taken before offering E15 at the pump.  The Nebraska Corn Board is pleased to take a leading role in the introduction of E15 in Nebraska.”

This stakeholders meeting was sponsored by the Blend Your Own (BYO) ethanol campaign.  BYO is a campaign funded by twelve corn producing states including Nebraska, the Renewable Fuels Association, and the American Coalition for Ethanol to promote ethanol and install blender pumps across the country.

Last year, the EPA approved E15 for 2001 and newer cars, light-duty trucks and SUVs.  And earlier this year, E15 became a legal fuel.



Nebraska Delegation Commemorates 150th Anniversary of Homestead Act

Congressmen Adrian Smith (R-NE), Lee Terry (R-NE), Jeff Fortenberry (R-NE) and Senators Ben Nelson (D-NE) and Mike Johanns (R-NE) released the following joint statement in advance of the 150th Anniversary of the Homestead Act:

“This simple, four-page document brought about significant and lasting changes to the United States,” said the Nebraska lawmakers in a joint statement. “This historic law gave millions of people a chance to pursue opportunity and live the American Dream. In Nebraska, the enduring impacts of the Homestead Act remain evident in our state’s culture, where reliance on personal responsibility, hard work, and common sense continue to serve us well.”

President Abraham Lincoln signed the Homestead Act into law on May 20, 1862, accelerating the settlement of the western territories. In total, 1.6 million people from 30 states claimed 270 million acres of land. The Homestead Act is currently on loan from the National Archives to the Homestead National Monument's Heritage Center in Beatrice, NE through May 28, 2012.



Smith Statement on House Farm Bill Legislation

Congressman Adrian Smith (R-NE) today issued the following statement as the House Agriculture Committee continues consideration of the Farm Bill reauthorization:

“A responsible Farm Bill is essential to keep Nebraska’s vibrant agricultural economy strong,” said Smith, who has hosted eight listening stops across the Third District on the upcoming reauthorization. “Our nation is currently facing record-high deficits, requiring difficult decisions, and I commend producers for their forward thinking. A workable Farm Bill which builds on the success of the crop insurance program will provide our farmers and ranchers the certainty they need to continue feeding America and the globe. I look forward to continued input from Nebraskans as the House bill takes shape.”

Smith has been travelling the Third District on his Farm Bill Listening Tour, holding eight stops to date: Gering, McCook, Aurora, Valentine, North Platte, Lexington, Crofton, and Fairbury. More information about Smith’s listening tour and the Farm Bill can be found on his website at: http://adriansmith.house.gov/FarmBill.

Smith serves as co-chairman of both the Modern Agriculture Caucus and the Congressional Rural Caucus.



Final Applications for NRCS Organic Initiative Due June 1

USDA Natural Resources Conservation Service (NRCS) State Conservationist Craig Derickson reminds potential applicants to contact their local NRCS office soon to find out if they are eligible for the agency’s Organic Initiative. Applications for the final ranking period of 2012 are due at NRCS offices by close of business on June 1, 2012.  The NRCS Office Locator is available at http://go.usa.gov/Uo8.

“This opportunity for assistance is perfect for those looking to become certified organic producers, or for those who are already certified growers.  NRCS is committed to help organic agriculture in Nebraska thrive,” Derickson said.

Nationwide, NRCS has nearly $50 million in financial and technical assistance available to certified organic producers, those who want to make the transition to organic production and producers who sell less than $5,000 in organic products annually.

Part of the Environmental Quality Incentives Program, the Organic Initiative offers a wide array of conservation practices specifically designed for organic production. “Practices will help the selected applicants meet many requirements of their USDA Organic System Plans and stay in compliance with USDA’s National Organic Program,” Derickson said.

The top five Organic Initiative conservation practices are cover crops, nutrient and pest management, seasonal high tunnels, crop rotation, and fencing.

Changes for the 2012 signups include three ranking periods for current and transitioning producers; a threshold ranking score that can speed up approval for qualified applicants; required conservation practices that promote the consistent use of those practices; and an expanded list of conservation activity plans.

Learn more about the Organic Initiative at http://go.usa.gov/Uo9 and find out about other NRCS initiatives and programs at http://go.usa.gov/UoX.




CJ BIO Breaks Ground on $320 Million Lysine Factory in NW Iowa

CJ BIO America broke ground on its first US construction project -- a $320 million lysine production facility at the North Central Ag Industrial Park west of Fort Dodge, Iowa.  Today's ceremony highlighted the creation of more than 170 jobs in central Iowa by 2014. The factory will annually produce more than 100,000 metric tons of amino acids to supplement animal feeds.

Lysine is derived from corn by-products to provide an essential amino acid for hog and poultry feed. Domestic production by CJ BIO America is expected to benefit demand for corn and provide better value with domestic feed customers.

"Combined with the capability of the state of Iowa, we believe that CJ will be able to produce our main product, Lysine, with a soaring synergy," said Mr. Tae Jin Jeong, Chief Operating Officer, Bio Division of CJ CheilJedang. "In addition, we believe without a doubt that CJ BIO America will be growing in conjunction with the community by actively promoting the growth of local economy as well as the state of Iowa's."

"The lieutenant governor and I both had the honor of meeting with CJ on our respective trade missions to the Republic of Korea," said Iowa Governor Terry E. Branstad. "We are extremely excited to welcome them here on Iowa soil for the groundbreaking. We appreciate the time, energy and investment CJ is making in our state and our people, and we look forward to working with them for many years to come."

Construction begins immediately at the 65-acre site, and the factory is expected to open in early 2014.



'See for Yourself' Participants View Checkoff in Action

What happens to U.S. soybeans after farmers unload their trucks at local grain elevators or processors? A group of U.S. soybean farmers are about to find out. The United Soybean Board (USB)/soy checkoff has selected 10 farmer-participants for the 2012 See for Yourself program, which will give attendees a firsthand look at how and where their soybeans are being used both domestically and internationally. The program, which also offers farmer participants an opportunity to evaluate specific, checkoff-funded research and promotional activities, will be held Aug. 5-11 in St. Louis and Guanajuato, Mexico.

The soy checkoff selected 10 farmers who applied to take part in the fifth annual See for Yourself program. These farmer-participants will see their checkoff dollars in action by visiting a number of sites related to the national soy checkoff objectives to improve the value of U.S. soybean meal and oil, ensure the industry and soy customers have the freedom and infrastructure to operate, and meet the needs of U.S. soy customers. The locations will also demonstrate USB's work to protect and support animal agriculture and increase public and private investment in transportation infrastructure.

Rick Stern, USB Audit & Evaluation program chair and a soybean farmer from Cream Ridge, N.J., believes the See for Yourself program helps inform farmers about the checkoff and allows them to evaluate and provide feedback on checkoff-funded programs. "There's no better way to show someone the value of their investment than to show them the results firsthand," Stern says.

For example, participants will learn about the use of soy biodiesel at Lambert-St. Louis International Airport, tour a barge-loading facility and visit a laboratory to see soy research taking place, all before heading to the number one market for U.S. soybean meal -- Mexico. While south of the U.S. border, participants will get a firsthand look at a large user of U.S. soy in the central Mexican state of Guanajuato.

The following U.S. soybean farmers will participate in the 2012 See for Yourself program:
-- Stephanie Essick, Dickens, Iowa
-- David Foster, Fort Scott, Kan.
-- Cory Atkins, Seaford, Del.
-- Jonathan Miller, Island, Ky.
-- Timothy Clark, Lomira, Wis.
-- Doug Singleteary, Bogota, Tenn.
-- Kristina Sutton, Potosi, Mo.
-- Andrew Fabin, Indiana, Pa.
-- Craig Williams, Oaktown, Ind.
-- John Yeargin, Greenfield, Tenn



NCGA Testifies Before House Ag Subcommittee on Farm Bill

Marking the first of a two day series, National Corn Growers Association Board Member Chip Bowling testified today before the House Agriculture Subcommittee on General Commodities and Risk Management on the 2012 farm bill.  Bowling, who also serves on the Public Policy Action Team, outlined NCGA's priorities for a strong federal crop insurance program and a revenue-based, risk management tool.

"The ability to purchase federal crop insurance and have access to a flexible revenue-based, risk management program to mitigate risks is even more critical today," Bowling, a grower from Newburg, Maryland said. "NCGA understands farmers need to be able to endure a certain amount of loss in any one year.  However, we are trying to protect farmers from depleting their emergency funds when they encounter revenue losses over multiple years."

Bowling also stated NCGA believes the Agricultural Risk Coverage program in the Senate Agriculture Committee's version of the farm bill reflects the NCGA principal that government programs should not encourage producers to take on unnecessary risk.  He went on to state the program is designed to partially offset losses not covered by crop insurance and to alleviate sharp year-to-year declines in price.

"The 2012 Farm Bill presents an opportunity to advance needed improvements in the commodity title that can work more effectively with a strong federal crop insurance program," said Bowling. "We understand the difficult task before your Committee but we also stress it would better serve farmers across the country to get a farm bill done this year."



NAWG President Voices Support for Multi-Legged Safety Net

The coming reauthorization of federal farm and food policy should include a multi-legged farm safety net with crop insurance as its foundation, NAWG President Erik Younggren testified Thursday to Members of the House Committee on Agriculture’s Subcommittee on General Farm Commodities and Risk Management.

Speaking at a hearing held to get stakeholder views prior to mark-up of 2012 Farm Bill legislation in the full Committee, Younggren stressed the importance of crop insurance to farmers’ risk management plans, which has made it the top priority for wheat growers and other crop producers in the 2012 Farm Bill.

However, he and other panelists recognized that crop insurance alone is not a fully-functioning safety net, and he voiced support for a revenue-based Title I program modeled on ACRE and SURE with an on- farm trigger and coverage by commodity.

“While we support a revenue-based program in Title I, we recognize and are grateful for concerns from the leaders of the House Agriculture Committee about protecting farmers and farm businesses in times of low prices,” Younggren said. “As a farmer, I share these concerns and recognize the risks of changing the existing safety net so dramatically that it removes the price protection currently available in Title I.”

The Wheat Growers president, who farms near Hallock, Minn., described a number of additional core principles that should guide House leaders when developing new farm policy, including:
-    building on the aspects of existing Title I programs that functioned well;
-    striving to bring Title I coverage as close to the farm as possible;
-    ensuring that any new programs do not unnecessarily distort planting decisions; and
-    ensuring programs are compliant with World Trade Organization (WTO) obligations.

He also strongly reiterated calls for Congress to complete its work on the 2012 Farm Bill quickly, before the current farm and food law expires on Sept. 30. This is made more critical for wheat growers, who will be planting winter wheat early this fall.

“If you take anything away from my testimony today, take this: it is of the utmost urgency to our farmer-members that you and your colleagues in the Senate approve new farm policy soon,” he said.

Thursday’s testimony was Younggren’s third appearance before a Congressional panel in preparation for the 2012 Farm Bill.



Gas Prices Down Again This Week

The U.S. average retail price of regular gasoline decreased 4 cents this week to $3.75 per gallon, 21 cents per gallon lower than last year at this time. This marks the sixth straight week of decline, and the first time since June 2011 that the price has decreased for six or more consecutive weeks.

Prices decreased in all regions except the West Coast, where the price increased 12 cents to $4.26 per gallon. The Rocky Mountain price was down a fraction of a penny to remain at $3.76 per gallon. East of the Rockies, the East Coast and Gulf Coast prices both decreased about 6 cents to reach $3.70 per gallon and $3.56 per gallon, respectively. The Midwest saw a decrease of 8 cents, the largest in the nation, to reach $3.64 per gallon.

The national average diesel fuel price decreased more than 5 cents to $4.00 per gallon, 6 cents per gallon lower than last year at this time. Prices dropped in all regions, with the Midwest seeing the largest decline, at about 7 cents, to reach $3.90 per gallon and remain the least expensive in the Nation. The Gulf Coast price is now $3.92 per gallon and diesel in the Rocky Mountains is $4.00 per gallon. Prices on the East and West Coasts are still above the $4 mark, at $4.05 per gallon and $4.28 per gallon, respectively.

Oil Closes Lower Thursday
The price of oil fell Thursday as worries persisted about the future of Greece in the European Union and the long-term impact that region's financial crisis could have on the global economy. Here's how energy contracts traded on the New York Mercantile Exchange:
Benchmark crude fell 25 cents to finish at $92.56 per barrel.
Gasoline fell 4.27 cents to end at $2.8782 per gallon.
Heating oil fell 4.86 cents to finish at $2.849 per gallon.
Natural gas fell 2.4 cents to end at $2.594 per 1,000 cubic feet.



USDA Farm Labor Report
Hired Workers Down Nearly 5 Percent, Wage Rates Up Nearly 2 Percent From a Year Ago

Beginning in 2012, two quarters of farm labor data are published semi-annually. Additionally, the agricultural service component was discontinued in 2012. Hired worker estimates exclude agricultural service employees.

There were 575,000 workers hired directly by farm operators on the Nation's farms and ranches during the week of January 8-14, 2012, down nearly 5 percent from a year ago. Workers hired directly by farm operators numbered 748,000 for the following quarter's reference week of April 8-14, 2012. Because NASS did not publish estimates for the April 2011 quarter, no previous year comparison is available for April.

Farm operators paid their hired workers an average wage of $11.52 per hour during the January 2012 reference week, up nearly 2 percent from a year earlier. Field workers received an average of $10.39 per hour, up more than 1 percent, while livestock workers earned $10.96 per hour compared with $10.52 a year ago. The field and livestock worker combined wage rate, at $10.58 per hour, was up 21 cents from last year. The number of hours worked averaged 39.6 for hired workers during the reference week, up fractionally from a year ago.

Farm operators paid their hired workers an average wage of $11.41 per hour during the April 2012 reference week, down 11 cents from the January quarter. Field workers received an average of $10.50 per hour, up 11 cents from January. Livestock workers earned $10.95, down just 1 cent from January. The field and livestock worker combined wage rate, at $10.62 per hour, was up 4 cents from January. The number of hours worked averaged 39.2 for hired workers during the April reference week.

For the January reference week, the largest percentage increases in the number of hired workers from last year occurred in the Corn Belt I (Illinois, Indiana, and Ohio) region and in Florida. The increase in Corn Belt I was largely driven by strong demand for livestock workers resulting from increased cattle and hog inventories. The increase in Florida was largely driven by strong demand from fruit and vegetable producers during recovery from a prior week freeze event.

For the January reference week, the largest percentage decreases in the number of hired workers from last year occurred in the Delta (Arkansas, Louisiana, and Mississippi) Northern Plains (Kansas, Nebraska, North Dakota, and South Dakota), and Northeast I (Connecticut, Maine, Massachusetts, and New Hampshire) regions. The decrease in the Delta region resulted primarily from softening demand for cotton workers, ahead of a substantial decrease in cotton acreage. In the Northern Plains and Northeast I regions, record mild January temperatures reduced the need for livestock overwintering activities and associated labor requirements.

For the January reference week, hired worker wage rates were above a year ago in the majority of regions. The largest increases occurred in Hawaii, Florida, and the Lake (Michigan, Minnesota, and Wisconsin) regions. The increase in Hawaii was mainly driven by a higher proportion of supervisory and specialty labor combined with wage increases for all worker groups. The higher wages in Florida resulted from the increased demand from fruit and vegetable producers. In the Lake region, generally higher wages followed a drop in overall hired workers.



Former Purdue Ag Associate Dean Heads NIFA

Sonny Ramaswamy, associate dean in the Purdue University College of Agriculture from 2006 to 2009, was appointed by President Barack Obama as director of the U.S. Department of Agriculture's National Institute of Food and Agriculture. He began in his new role May 7.  Ramaswamy most recently was dean of the College of Agricultural Sciences at Oregon State University.  At Purdue, Ramaswamy served as director of Agricultural Research Programs, now called Agricultural Research at Purdue, and was associate dean for research.

NIFA is part of USDA's research, education and economics mission area. It links the USDA with universities and other public and private organizations to advance research, Extension and higher education in the food and agricultural sciences and related environmental, social and human sciences.



Land O'Lakes Reports Solid First-Quarter Performance

Land O’Lakes, Inc., today reported first-quarter financial results, with net sales of $3.9 billion and $85 million in net earnings.  Net sales were up 12 percent from one year ago ($3.5 billion). Although net earnings were down from the record high of $101 million in the first quarter of 2011, this year’s $85 million represents the second-best first quarter performance for the company. 

Company officials called first quarter performance “solid, but mixed,” noting the impact of declining dairy markets and high input costs in the Egg business, which were offset by stronger than expected performance in the Crop Inputs business. Across the company’s core businesses (Dairy Foods, Crop Inputs, Layers/Eggs and Animal Feed), premium, branded products and new innovative products and technologies performed well.
- Net Sales - $3.87 billion: Net sales for the quarter increased 12 percent to $3.87 billion, compared with $3.47 billion for the first quarter of 2011.  Net sales were up in all the company’s businesses.
- Net Earnings - $84.6 million: First quarter net earnings of $84.6 million were down from $101.0 million for the first quarter of 2011. Earnings results were mixed, with reduced earnings in Dairy Foods and Layers/Eggs partially offset by improved earnings in Crop Inputs and Feed.
 
“Our first-quarter results reflect the level of volatility and uncertainty we continue to see across our industry,” Land O’Lakes President and CEO Chris Policinski said. “One year ago, for example, dairy prices were strong and rising, while this year dairy prices were lower and dropping throughout the quarter. On the positive side, an early spring contributed to stronger demand and increased opportunity in the Crop Inputs business. Ultimately, the depth and breadth of our business portfolio, as well as our strong brands, market positions and innovative products contributed to our solid performance and enabled us to manage through the volatility.”

Policinski added that with a strong balance sheet and promising opportunities both domestically and globally, the company is continuing to pursue strategic, profitable growth.

“The growth we’re pursuing will enable Land O’Lakes to continue building competitive advantage and better serve our customers and member-owners,” Policinski said.  “When we look at economic conditions in general, we see tremendous opportunities in agriculture and food production, as the global demand for food continues to increase. Land O’Lakes and our members are well-positioned to play a major role in meeting that demand, continuing our growth momentum.”