Friday August 12 USDA Reports + Ag News

NEBRASKA CROP PRODUCTION REPORT

Based on August 1 conditions, Nebraska's 2016 corn production is forecast at a record high of 1.76 billion bushels, up 4 percent from last year, according to the USDA’s National Agricultural Statistics Service. Acreage harvested for grain is estimated at 9.40 million acres, up 3 percent from a year ago. Average yield is forecast at 187 bushels per acre, up 2 bushels from last year and the highest on record.

Soybean production in Nebraska is forecast at a record high of 310 million bushels, up 1 percent from last year. Area for harvest, at 5.25 million acres, is down slightly from 2015. Yield is forecast at a record high of 59 bushels per acre, up 1 bushel from last year.

Nebraska’s 2016 winter wheat crop is forecast at 63.6 million bushels, up 38 percent from last year. Harvested area for grain, at 1.20 million acres, is down 1 percent from a year ago. Average yield is forecast at a record high of 53 bushels per acre, up 15 bushels per acre from 2015.

Sorghum production of 14.0 million bushels is down 39 percent from a year ago. Area for grain harvest, at 150,000 acres, is down 38 percent from last year. Yield is forecast at 93 bushels per acre, down 3 bushels from last year.

Oat production is forecast at 2.52 million bushels, down 6 percent from last year. Harvested area for grain, at 40,000 acres, is unchanged from last year. Yield is forecast at 63 bushels per acre, down 4 bushels from 2015.

Alfalfa hay production is forecast at 3.04 million tons, down 11 percent from last year. Expected yield, at 3.80 tons per acre, is down 0.2 ton from last year. All other hay production is forecast at 3.06 million tons, up 3 percent from last year. Forecasted yield, at a record high of 1.70 tons per acre, is up 0.1 ton per acre from last year.



IOWA CROP PRODUCTION REPORT

Iowa corn production is forecast at 2.68 billion bushels according to the latest USDA, National Agricultural Statistics Service – Crop Production report. If realized, the production will be a new record high, topping last year’s 2.51 billion bushels. Based on conditions as of August 1, yields are expected to average 197 bushels per acre, an increase of 5 bushels per acre from last year. If realized, the yield will break last year’s previous record high for Iowa. Corn planted acreage is estimated at 14.0 million acres. An estimated 13.6 million of the acres planted will be harvested for grain.

Soybean production is forecast at 550 million bushels. If realized, this will be the second all-time high, behind last year’s 554 million bushels. The August 1 yield forecast is 57.0 bushels per acre, 0.5 bushels more than 2015. If realized, this will be a new record high yield, topping last year’s current record high. Soybean planted acreage is estimated at 9.80 million acres with 9.65 million acres to be harvested.

Oat production for grain is forecast at 3.60 million bushels. The expected yield is 68.0 bushels per acre, down 5.0 bushels from 2015, but up 3.0 bushels from the July forecast. An estimated 53,000 acres will be harvested for grain.

Iowa hay yield for alfalfa and alfalfa mixtures is expected to be 4.00 tons per acre with a total production of 3.00 million tons, virtually unchanged from the previous year. The projected yield for other hay is 2.20 tons per acre, with production at 770,000 tons, down 18 percent from 2015.

All crop forecasts in this report are based on August 1 conditions and do not reflect weather effects since that time. The next corn and soybean production forecasts, based on conditions as of September 1, will be released on September 12.



USDA Crop Production 2016 Estimate - Aug 12, 2016
Corn Production Up 11 Percent from 2015
Soybean Production Up 3 Percent from 2015
Winter Wheat Production Up 2 Percent from July Forecast

Corn production is forecast at 15.2 billion bushels, up 11 percent from last year. Based on conditions as of August 1, yields are expected to average 175.1 bushels per acre, up 6.7 bushels from 2015. If realized, this will be the highest yield and production on record for the United States. Area harvested for grain is forecast at 86.6 million acres, unchanged from the June forecast, but up 7 percent from 2015.

Soybean production is forecast at a record 4.06 billion bushels, up 3 percent from last year. Based on August 1 conditions, yields are expected to average a record 48.9 bushels per acre, up 0.9 bushel from last year. Area for harvest in the United States is forecast at a record 83.0 million acres, unchanged from the June forecast but up 1 percent from 2015. Planted area for the Nation is estimated at a record 83.7 million acres, also unchanged from June.

All cotton production is forecast at 15.9 million 480-pound bales, up 23 percent from last year. Yield is expected to average 800 pounds per harvested acre, up 34 pounds from last year. Upland cotton production is forecast at 15.3 million 480-pound bales, up 23 percent from 2015. Pima cotton production is forecast at 565,000 bales, up 30 percent from last year.

All wheat production, at 2.32 billion bushels, is up 3 percent from the July forecast and up 13 percent from 2015. Based on August 1 conditions, the United States yield is forecast at 52.6 bushels per acre, up 1.3 bushels from last month and up 9 bushels from last year.

Winter wheat production is forecast at 1.66 billion bushels, up 2 percent from the July 1 forecast and up 21 percent from 2015. Based on August 1 conditions, the United States yield is forecast at 54.9 bushels per acre, up 1 bushel from last month and up 12.4 bushels from last year. The area expected to be harvested for grain or seed totals 30.2 million acres, unchanged from last month but down 6 percent from last year. Hard Red Winter production, at 1.05 billion bushels, is up 1 percent from last month. Soft Red Winter, at 372 million bushels, is up less than 1 percent from the July forecast. White Winter, at 237 million bushels, is up 6 percent from last month. Of the White Winter production, 21.7 million bushels are Hard White and 216 million bushels are Soft White.

Durum wheat production is forecast at 91.7 million bushels, up 11 percent from both July and 2015. The United States yield is forecast at 44.1 bushels per acre, up 4.3 bushels from last month and 0.6 bushel from last year. Expected area to be harvested for grain totals 2.08 million acres, unchanged from last month but up 10 percent from last year.

Other spring wheat production is forecast at 571 million bushels, up 4 percent from the July 1 forecast but down 5 percent from last year. Area harvested for grain is expected to total 11.8 million acres, unchanged from last month but down 9 percent from last year. The United States yield is forecast at 48.3 bushels per acre, up 1.8 bushels from last month and up 2 bushels from last year. Of the total production, 531 million bushels are Hard Red Spring wheat, up 4 percent from the previous forecast but down 6 percent from last year.



World Ag Supply and Demand Estimate - Aug 12, 2016

COARSE GRAINS: Projected 2016/17 U.S. feed grain supplies are increased this month with higher forecast corn, sorghum, barley, and oats production. Corn production is forecast at a record 15.2 billion bushels, up 613 million from the July projection. The season’s first surveybased corn yield forecast, at 175.1 bushels per acre, is up 7.1 bushels from last month’s trendbased projection and above the record 171.0 bushels in 2014/15. The Crop Production report indicates that nearly all Corn Belt states, with the exception of Minnesota and South Dakota, are forecast to have yields above a year ago. Sorghum production is forecast 55 million bushels higher with the forecast yield 8.4 bushels per acre above last month’s projection.

U.S. corn supplies for 2016/17 are projected at a record 16.9 billion bushels, up 1.5 billion from the prior year with the larger crop and small increases in beginning stocks and imports. Ending stocks for 2015/16 are raised 5 million bushels reflecting a larger import projection and offsetting usage changes. Imports are raised as the pace of organic corn imports through June has been above expectations. Corn use for ethanol production in 2015/16 is lowered 25 million bushels, based on the latest indications from the Grain Crushings and Co-Products Production report. An offsetting 25-million-bushel increase is made to corn exports supported by the recent robust pace of shipments and sales.

Total U.S. corn use for 2016/17 is projected 300 million bushels higher at a record 14.5 billion. Feed and residual use is raised 175 million bushels with the larger crop and lower expected prices. Exports are projected 125 million bushels higher, reflecting the relative competitiveness of U.S. corn on the world market and large new-crop outstanding sales. Corn ending stocks for 2016/17 are projected 328 million bushels higher and, if realized, would be the highest since 1987/88. The projected range for the season-average corn price received by producers is lowered 25 cents on both ends to $2.85 to $3.45 per bushel. This would be down 45 cents at the midpoint from the $3.55 to $3.65 per bushel range now expected for 2015/16. The all barley price is raised this month based on early indications of prices received by farmers for malting barley.

Foreign coarse grain supplies for 2016/17 are projected 5.1 million tons higher this month with a 2.3-million-ton increase in beginning stocks and a 3.0-million-ton increase in production. Foreign corn carryin is up, mostly reflecting lower 2015/16 corn feeding in Indonesia, Canada, and Ukraine as 2015/16 corn production increases for the EU and South Africa offset a further reduction for Brazil. Foreign corn production for 2016/17 is raised 2.1 million tons with increases for Argentina, India, and Mexico more than offsetting reductions for the EU and Canada. Corn area is raised in Argentina on an expected reduction in planted area for wheat and small grains.

For India, corn area is increased as favorable rainfall has boosted plantings to date as reported in the latest government statistics. Abundant summer rainfall in Mexico boosts corn yield prospects, but persistent dryness in Ontario reduces the outlook for production in Canada. EU corn production is lowered mostly on reductions for Spain and France.

Global coarse grain consumption for 2016/17 is raised 8.9 million tons this month with higher corn use in the United States accounting for half of the increase. Outside the United States, corn feeding is raised for Mexico, India, and the EU. Partly offsetting is a 1.0-million-ton reduction in corn feeding for Indonesia, where government import licensing policy is expected to reduce corn imports. Global coarse grain trade is raised reflecting increases for corn and to a lesser extent barley. Global 2016/17 coarse grain ending stocks are projected 13.4 million tons higher reflecting larger corn and barley stocks.  Global corn stocks are projected 12.4 million tons higher with the United States accounting for two-thirds of the increase.

OILSEEDS: U.S. oilseed production for 2016/17 is projected at 120.2 million tons, up 4.8 million from last month due to a higher soybean production forecast. Soybean production for 2016/17 is forecast at 4,060 million bushels, up 180 million due to increased yields. Harvested area is forecast at 83.0 million acres, unchanged from the July projection. The first survey-based soybean yield forecast of 48.9 bushels per acre is 2.2 bushels above last month and 0.9 bushels above last year’s record. With higher production only partly offset by lower beginning stocks, soybean supplies for 2016/17 are projected at a record 4,346 million bushels. Soybean crush is raised 15 million bushels based on expected higher domestic use and exports of soybean meal.

Soybean exports are raised 30 million bushels to 1,950 million. Despite higher use, soybean ending stocks are projected at 330 million bushels, up 40 million from last month.

The U.S. season-average soybean price for 2016/17 is forecast at $8.35 to $9.85 per bushel, down 40 cents on both ends of the range. Soybean meal prices are forecast at $305 to $345 per short ton, down 20 dollars at the midpoint. The soybean oil price forecast is unchanged at 29.5 to 32.5 cents per pound.

U.S. changes for 2015/16 include increased soybean crush and exports, and lower ending stocks. The soybean crush is raised 10 million bushels to 1,900 million reflecting increased domestic use and exports of soybean meal. Soybean exports are raised 85 million bushels to 1,880 million as unusually large outstanding old-crop sales are confirmed by the latest shipment data. With increased use, 2015/16 ending stocks are projected at 255 million bushels, down 95 million from last month.

Global oilseed production for 2016/17 is projected at 543.5 million tons, up 7.0 million from last month. Global soybean production is projected at a record 330.4 million tons, up 4.5 million. The U.S. production increase is partly offset by reductions for both India and Ukraine with the latest planting data for both countries indicating lower forecasts for harvested area. Rapeseed production is raised for Canada where abundant moisture and favorable temperatures in July helped to boost yield prospects. Partly offsetting is a reduction for EU rapeseed production on excessive moisture in key growing areas, particularly in France. Other changes include increased sunflowerseed production for Russia and Ukraine, increased peanut production for India and Senegal, increased cottonseed production for China, and reduced cottonseed production for India. For 2015/16, global vegetable oil trade is expected to decline 1.5 million tons from last month due to lower palm oil production in Indonesia and Malaysia.

Global oilseed supplies for 2016/17 are raised 8.1 million tons with increased production and higher beginning stocks. With larger supplies only partly offset by increased crush, 2016/17 global oilseed stocks are projected at 80.6 million tons, up 4.5 million from last month.

LIVESTOCK, POULTRY, AND DAIRY: The forecast for total red meat and poultry production for 2016 is reduced from last month as increased beef and turkey production is more than offset by lower forecast pork and broiler production. Beef production is forecast higher on higher expected third quarter steer and heifer slaughter. However, second quarter production is adjusted lower to reflect June production data. Pork production for 2016 is lowered on expectations of slightly lighter carcass weights for the remainder of the year. Broiler production is lowered on slower expected growth in the fourth quarter. Turkey production is raised for 2016, largely on June production data. Production forecasts for 2017 red meat and poultry are raised as lower forecast feed prices are expected to encourage increased production. Table egg production is raised for 2016 on June production data; the 2017 forecast is unchanged.

The beef import forecasts for 2016 and 2017 are raised in part due to expectations of increased imports from Brazil beginning in the later part of 2016. Beef exports for 2016 are lowered based on June trade data; no change is made to the 2017 forecast. Small adjustments are made to pork trade based on June data; no change is made to the forecasts. Broiler exports for 2016 are lowered due to a slower pace of exports in June; no change is made to 2017. No change is made to turkey exports.

Cattle, hog, and broiler prices for second-half 2016 are reduced from last month on weakness in current prices. Prices for cattle, hogs and broilers for 2017 are reduced from last month as production is forecast higher; however, the annual price range for cattle is unchanged. Turkey prices are raised for the third quarter of 2016 but are unchanged for 2017. Egg prices are lowered for 2016 and 2017.

The milk production forecast for 2016 is lowered from last month as growth in milk per cow is reduced. However, the production forecast for 2017 is raised as higher forecast milk prices and lower feed costs in late 2016 and 2017 are expected to lead to a modest expansion in the cow inventory and more rapid growth in milk per cow. Fat basis exports are raised for 2016 on continued strength in whole milk powder (WMP) exports. The forecast for 2017 is unchanged.

On a skim-solids basis, the export forecasts for 2016 and 2017 are raised on higher sales of WMP and whey products. Imports are raised for 2016 and 2017 as imports of fat-containing products has increased. Fat basis stocks are forecast higher as stocks of butter remain high, but on a skim-solids basis, stocks are reduced.

Cheese, nonfat dry milk (NDM) and whey prices for 2016 are forecast higher as demand remains firm, but the forecast for butter price is reduced as stocks remain larger than expected. The Class III price is raised, reflecting higher cheese and whey prices, but the Class IV price is lowered as the lower butter price more than offsets the higher NDM price. For 2017, prices of cheese, butter, and whey are increased, but NDM is unchanged from last month. The Class III and Class IV price forecasts are raised on the stronger component prices. The all milk prices are forecast higher at $16.25 to $16.45 per cwt for 2016 and $16.15 to $17.15 per cwt for 2017.



Nebraska Brand Committee Taking Action to Improve

Nebraska Cattlemen (NC) as an organization has a keen interest in the conduct of the Nebraska Brand Committee (NBC). Prior to the inception of the state agency, Nebraska Stock Growers, the predecessor to the Nebraska Cattlemen ran the program. Because of this interest the meetings of the NBC are observed.

The current NBC members have three new members and two longer term members who have been proactive in nature, not merely accepting the status quo but looking for ways to improve the processes of the NBC and have more accountability while improving services.

NBC, on their own, identified many of the things that were found in the Auditor's report and had begun on a path to address the deficiencies.

Large scale changes take time to implement and NBC is working in a systematic, thoughtful manner to implement the right changes in the right order.

They accepted the resignation of the Executive Director this week. Since the Assistant Director position has not been filled Mr. Harvey was appointed to continue in a lesser capacity with NBC in the interim until the hiring of a new Executive Director and Assistant Director can take place.

NC recognizes that the NBC members are volunteers who are cattlemen just as each of us. We applaud their work to take positive, corrective measures.



Program Connects U.S. Soybean Farmers to Breadth of Industry

The U.S. soybean industry is a multi-faceted, global business, and 10 U.S. soybean farmers just got a closer look at how their soy checkoff works in that marketplace to all U.S. soybean farmers’ benefit. Sponsored by the United Soybean Board’s Audit and Evaluation (A&E) Committee, the See for Yourself program connected these farmers with their checkoff investment, providing transparency into the soy checkoff and allowing farmers to find out more about the many end uses for U.S. soy.

“The See for Yourself program was an eye-opening experience,” said Sam Showalter, an Iowa soybean farmer and See for Yourself participant. “To see how the checkoff works around the world and how the world  looks up to us for some of our practices was incredible.”

The program concludes today in Costa Rica, a country that imported 100 percent of its soy from the United States in the 2014/2015 marketing year, a true checkoff success story. Participants heard from INOLASA, the sole soybean-crushing plant in Central America. The checkoff, through the United States Soybean Export Council (USSEC), partnered with INOLASA to increase U.S. soybean consumption in Costa Rica, taking it from 33 percent of its imports in 2014 to 100 percent in 2015. 

While in Costa Rica, the participants also learned about the soy-fed fish industry from Martec Industries, a company dedicated to the production, processing and marketing of seafood, especially red snapper. The checkoff invests in marketing and promotion of soy in fish feed and helped Martec incorporate soybean meal into its rations. The fish are raised in cages in the Pacific Ocean and their feed includes roughly 18 percent soy, all of which comes from the U.S.

The program also made stops in St. Louis and Panama. In St. Louis at the USB headquarters, participants learned more about the checkoff’s work to maximize farmer profit opportunities through investments in infrastructure research, new industrial uses and high oleic soybeans. The checkoff is focused on key strategies around soybean oil, meal and sustainability – ensuring U.S. soybean farmers remain competitive in the future.

Infrastructure discussions continued as the participants went through the newly expanded Panama Canal. The canal’s recent expansion doubled the waterway’s capacity, helping to ship U.S. soy to foreign markets faster. Foreign soy buyers often pay as much attention to the timeliness of deliveries as they do the price, so the canal’s expansion increased U.S. soy’s competitiveness on the global scale. “It’s incredible the amount of soybeans that move through the canal and the time saved because of this new expansion,” said Adam Hendricks, Kentucky soybean farmer and See for Yourself participant. “In discussing the Panama Canal, we learned that about 44 percent of our exported soybeans from the U.S. pass through the Panama Canal, so it plays an important role in meeting global demands.” 

While they knew little of the checkoff’s role prior to the program, the farmer-participants dove right in to better understand the checkoff and the uses of soybeans around the world.

“The farmers on this program really got their eyes opened to what the soy checkoff does for them as a farmer and marketer of soybeans,” says Keith Tapp, Kentucky soybean farmer and A&E Committee chair. “In all of our locations, I think the participants saw a wide range of activities demonstrating how the checkoff works for them and all U.S. soybean farmers.”



WEST COAST DOCK WORKERS VOTE FOR EARLY CONTRACT NEGOTIATIONS

The International Longshore and Warehouse Union (ILWU), which represents about 20,000 dock workers at 29 West Coast ports, this week voted to begin talks now on an extension of its contract with the Pacific Maritime Association (PMA), which represents West Coast port facilities owners. The PMA and ILWU signed a five-year contract in early 2015 – retroactive to July 1, 2014 – after protracted labor talks and a nearly four-month work slowdown that negatively affected U.S. exporters. The U.S. meat and poultry sectors lost an estimated $40 million a week during the slowdown, which went from November 2014 to February 2015.

One-hundred-thirteen trade associations in March 2016 sent a letter to the ILWU and the PMA, urging them to begin early discussions on a contract extension or a new contract. The groups, representing manufacturers, farmers and agribusinesses, wholesalers, retailers, importers, exporters, distributors, transportation and logistics providers and other supply chain stakeholders, also suggested the two sides develop a new model, including early and continuous dialogue between the parties, for future negotiations and called on the union and the port association “to avoid actions that would slow, stop, or disrupt cargo movement during negotiations.”

In a related matter, the International Longshoremen’s Association, representing East Coast and Gulf Coast dock workers, put a hold on its early contact talks with the United States Maritime Alliance. That contract expires in September 2018.

 

VEGAN MAYO MAKER ACCUSED OF BUYING PRODUCT TO INFLATE SALES FIGURES

A Bloomberg News investigation of Hampton Creek, a vegan company co-founded and co-owned by Humane Society of the United States (HSUS) farm animal activist Josh Balk, uncovered a controversial program to buy back its vegan mayonnaise from retail shelves. Bloomberg alleges this was done to inflate retail sales figures of the eggless mayonnaise, called Just Mayo, as the company sought investor financing.

At least eight months before Hampton Creek sought funding, executives quietly launched an initiative to purchase mass quantities of Just Mayo from stores, according to five former workers and more than 250 receipts, expense reports, cash advances and e-mails reviewed by Bloomberg. Employees were encouraged to make multiple transactions through store self-checkout lanes to avoid looking suspicious. Former employees said they were told to do whatever they wanted with the product after finishing the job. According to Bloomberg, most employees said they threw the product in the trash. Employees also were instructed to conceal their identities, pretending they were customers, and to call store managers of Whole Foods, Safeway and Kroger locations to stoke demand.

Hampton Creek officials said the main purpose of the purchases by company contractors was to check the quality of the mayo. But, said Kurt Jetta of consumer data company Tabs Analytics, “there’s no legitimate explanation for a manufacturer buying significant quantities of their own product from the shelf.”

Earlier this year, Hampton Creek sought additional funds to launch as many as 560 new plant-based products.

In late October 2014 the parent company of Hellmann’s mayonnaise, Unilever, filed a lawsuit against Hampton Creek for false advertising, arguing that Just Mayo couldn’t be marketed as mayonnaise because it doesn’t meet the U.S. Food and Drug Administration definition of the product: 65 percent vegetable oil and at least one egg yolk-containing ingredient. Unilever dropped the suit in December 2014, and the FDA in August 2015 warned Hampton Creek that Just Mayo’s labeling was misleading because the product did not meet the standards for “mayonnaise.”



NMPF Asks USDA to Provide Assistance to Dairy Farmers Struggling from Global Milk Price Depression

As America’s dairy farmers endure the lowest milk prices since the Great Recession of 2009, the National Milk Producers Federation today asked the U.S. Department of Agriculture to provide a measure of relief by purchasing at least $100 million worth of cheese products for donation to the needy – a measure that would help both farmers, and food insecure Americans who patronize food banks.

In a letter sent Friday to Agriculture Secretary Tom Vilsack, National Milk urged the department to use all of its available authorities to purchase $100 to $150 million of cheese. NMPF asked USDA to utilize its Section 32 program, as well as additional authorities through the Farm Service Agency, the Food and Nutrition Service, and the Commodity Credit Corporation. 

“Dairy producers here in the United States need assistance to help endure this 18-month depression in milk prices,” said Jim Mulhern, NMPF President and CEO. “This type of assistance would both help economically-strapped farmers, and also help those without ready access to nutritious dairy products.”

A cheese buying program of up to $150 million would allow for the distribution of as much as 90 million pounds of cheese to nonprofit food banks. Donating this quantity of cheese would remove the equivalent of almost 900 million pounds of milk from the domestic commercial market and strengthen farm-level prices by about $0.16 per hundredweight over the course of a year, increasing the incomes of all U.S. dairy farmers by approximately $380 million.

Global dairy demand has sagged in the past two years, due primarily to a reduction in purchases by China and Russia. Meanwhile, a global rise in milk production – particularly in Europe, where production quotas were removed last year – has led to a worldwide imbalance between supply and demand, pushing prices down for farmers around the world. U.S. dairy exports have slumped, leading to a large domestic buildup of American-type cheese (between 2014 and 2016, U.S. cheese exports dropped by almost 20 percent).

The current national price for farmers’ milk is $14.50 per hundredweight, or $1.25 per gallon, the lowest price since October 2009, NMPF’s letter said. The cost of purchased feed has risen recently, producing a Margin Protection Program (MPP) margin of $5.76 per hundredweight for the May-June period, the lowest bimonthly margin since MPP began.

Also in the letter, NMPF once again reiterated its desire to work with USDA to make necessary improvements to MPP, the dairy safety net program created out of the 2014 farm bill. Limitations of the program approved by Congress have caused few producers to sign up for coverage at levels that will provide sufficient support this year, and NMPF hopes to work with Congress and USDA in the future to alleviate the issue.