Monday July 6 Crop Progress & Condition Report + Ag News

NEBRASKA CROP PROGRESS AND CONDITION

For the week ending July 5, 2020, there were 6.1 days suitable for fieldwork, according to the USDA's National Agricultural Statistics Service. Topsoil moisture supplies rated 16% very short, 34% short, 49% adequate, and 1% surplus. Subsoil moisture supplies rated 11% very short, 28% short, 60% adequate, and 1% surplus.

Field Crops Report:
Corn condition rated 1% very poor, 5% poor, 20% fair, 52% good, and 22% excellent. Corn silking was 4%, near 1% last year, but behind 11% for the five-year average.

Soybean condition rated 1% very poor, 4% poor, 19% fair, 56% good, and 20% excellent. Soybeans blooming was 41%, well ahead of 7% last year, and ahead of 27% average. Setting pods was 4%.

Winter wheat condition rated 4% very poor, 14% poor, 32% fair, 47% good, and 3% excellent. Winter wheat harvested was 16%, ahead of 1% last year, but near 19% average.

Sorghum condition rated 1% very poor, 3% poor, 28% fair, 57% good, and 11% excellent. Sorghum headed was 7%, near 10% last year and 5% average.

Oats condition rated 2% very poor, 11% poor, 30% fair, 52% good, and 5% excellent. Oats headed was 97%, ahead of 86% last year, and near 95% average.

Dry edible bean condition rated 0% very poor, 1% poor, 27% fair, 65% good, and 7% excellent. Dry edible beans blooming was 8%.

Pasture and Range Report:
Pasture and range conditions rated 5% very poor, 9% poor, 23% fair, 59% good, and 4% excellent.



IOWA CROP PROGRESS REPORT

 Little to no precipitation for much of Iowa allowed farmers 6.0 days suitable for fieldwork during the week ending July 5, 2020, according to the USDA, National Agricultural Statistics Service. Fieldwork activities included applying fertilizer, spraying, harvesting hay and hauling grain.

Topsoil moisture levels rated 3% very short, 19% short, 76% adequate and 2% surplus. Subsoil moisture levels rated 2% very short, 14% short, 81% adequate and 3% surplus.

There were reports of corn silking across much of the State with an average of 5%, almost 1 week ahead of the previous year but 2 days behind the 5-year average. Corn condition rated 85% good to excellent.

Soybean blooming reached 37%, almost 2 weeks ahead of last year and 6 days ahead of average. There were scattered reports of soybeans beginning to set pods. Soybean condition rated 84% good to excellent.

Oats headed progressed to 94%, 5 days ahead of last year. Oats turning color reached 36%, 4 days ahead of last year but 2 days behind the average. Oat condition rated 85% good to excellent.

Alfalfa hay second cutting reached 38%, 11 days ahead of last year and 2 days ahead of the average. Hay condition rated 77% good to excellent.

Pasture condition rated 69% good to excellent. There were reports of heat stress affecting cattle as well as continuing issues of pinkeye for cow/calf producers.



EXTENSION WEBINAR TO OFFER STRATEGIES FOR CASH FLOW PLANNING AMID PANDEMIC

COVID-19 has impacted the finances and business plans of agricultural producers across the state. An upcoming Nebraska Extension webinar will focus on cash flow strategies and available tools as farmers and ranchers plan for the rest of the year.

“Cash Flowing to the Other Side of COVID-19” will be presented on Thursday at noon, by Robert Tigner, an extension educator and agricultural systems economist in the University of Nebraska-Lincoln’s Department of Agricultural Economics. It is part of a weekly webinar series produced by the department’s extension Farm and Ranch Management team.

“Cash Flow in 2020 is even more important due to the economic shocks caused by the pandemic,” Tigner said.

The webinar will suggest changes that can be made to cash flow that has yet to occur this year and highlight planning resources available to farmers and ranchers.

It will be held live on Zoom for approximately one hour, including time for questions from participants. Registration is open to everyone at farm.unl.edu. Additional information, a schedule of other upcoming webinars and recordings of all sessions in the webinar series are available as well.



U.S. Corn, Soybeans Both Rated 71% Good to Excellent

Good-to-excellent condition ratings were the same for both U.S. corn and soybeans last week -- a slight drop for corn but steady for soybeans, USDA NASS said in its weekly Crop Progress report on Monday.

NASS estimated that 71% of the corn crop was in good-to-excellent condition as of Sunday, July 5, down 2 percentage points from 73% the previous week but still well above 57% at the same time a year ago.  Corn silking continued to run behind the average pace last week. NASS estimated that 10% of corn was silking, 6 percentage points behind the five-year average of 16%.

Soybean development, on the other hand, was near to slightly ahead of normal last week. Soybeans blooming was estimated at 31%, 7 percentage points ahead of the five-year average of 24%, while soybeans setting pods was estimated at 2%, near the five-year average of 4%.  The national soybean condition rating came in the same as the corn crop: 71% good to excellent. That was unchanged from the previous week and still well ahead of 53% at the same time last year.

Meanwhile, winter wheat harvest moved ahead 15 percentage points last week to reach 56% complete as of Sunday, 1 percentage point ahead of the five-year average of 55%.  Winter wheat condition -- for the portion of the crop still in fields -- was rated 51% good to excellent, down 1 percentage point from 52% from the previous week. Sixty-one percent of North Dakota's winter wheat crop was rated good-to-excellent.

The percentage of spring wheat headed jumped 27 percentage points last week to reach 63% as of Sunday, 5 percentage points behind the average of 68%.  Spring wheat condition was estimated at 70% good to excellent, up 1 percentage point from 69% the previous week.

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Nebraska Cattlemen Foundation Announces Retail Value Steer Challenge Winners

The Nebraska Cattlemen Foundation (NCF) Retail Value Steer Challenge (RVSC) is the primary fundraiser for the NC Foundation with money raised supporting youth & adult educational programs, scholarships, research & infrastructure projects, history preservation and judging teams at colleges in Nebraska. The 21st Retail Value Steer Challenge began at Darr Feedlot in November 2019 and concluded in early June 2020. Winners in three categories - Average Daily Gain, Carcass Value, and Overall Total Value - were recognized for their steer’s performance.

First place in the Average Daily Gain category was awarded to the steer owned by Shotkoski Hay Company of Lexington, second place went to a steer owned by AL Ranch from Halsey and the third place was awarded to the steer owned by Imperial Beef. In the Carcass Value category, Scott & Karen Langemeier of Stromsburg owned the winning steer, Platte Valley Companies of Scottsbluff received second place and Esch Cattle Company of Unadilla received the third place honors. First place in the Total Value Category was a steer owned by Power Genetics of Arapahoe, second place went to the steer owned by FNBO – North Platte and third place went to West Point Implement & Design.

The NC Foundation would like to recognize the support of Darr Feedlot, Cozad, for administration and feeding of the steers that were entered into this year’s challenge. The Foundation also appreciates Arthur J. Gallagher & Co. and Bill’s Volume Sales, Inc. for their sponsorship of the Retail Value Steer Challenge and thanks the many donors who delivered or purchased steers for the RVSC. Their support and participation allow the Foundation to fund the many projects and scholarships that benefit our industry.

The Foundation will soon be recruiting for the 22nd Retail Value Steer Challenge and your involvement ensures these programs succeed. Donors receive complete carcass data on their steer or steers and the chance to win prize money. NCF welcomes steer donations by individuals, businesses, groups of individuals or businesses and NC affiliates and participants can donate their own steer or purchase a steer from the Foundation. For more information concerning the Nebraska Cattlemen Foundation, contact Lee Weide, Nebraska Cattlemen Vice President of Operations at 402/475-2333 or Jana Jensen, NCF Fundraising Coordinator at 308/588-6299.



Ricketts, Fellow Governors Call on EPA to Reject Oil Refineries’ Attempts to Avoid Renewable Fuel Obligations

Governor Pete Ricketts recently joined the governors of Iowa, Minnesota, and South Dakota to write a letter to U.S. Environmental Protection Agency (EPA) Administrator Andrew Wheeler.  The four governors expressed their concern over the EPA’s willingness to consider 52 applications for retroactive small refinery exemptions (SREs).

“Even before the coronavirus pandemic, the misuse of small refinery waivers under the RFS caused a significant number of plants to partially or fully shut down,” the Governors wrote.  “The resulting job losses, decreases in commodity purchases and prices, and shortages of co-products affect rural America every day.  Your approval of these SRE ‘gap filings’ would only worsen the unprecedented economic challenges facing the renewable fuels industry and rural communities.”

Under the Renewable Fuel Standard (RFS), refiners must meet renewable volume obligations by blending renewable fuels into their gasoline or by purchasing credits equivalent to the required amount of renewable fuel.  Oil refineries have repeatedly sought exemptions to avoid fulfilling their obligations.

Since 2017, the EPA has granted 85 SREs.  In total, these SREs have depressed demand for ethanol and other biofuels by over four billion gallons.  In January, the Tenth Circuit Court of Appeals ruled that the EPA had improperly granted SREs in some cases.  Even so, the EPA continues to consider new waiver requests by small oil refineries.  Approval of the 52 pending applications would cause the market loss of another two billion gallons of biofuel blending requirements. 



Nebraska Corn Board Grant Supports Higher Ethanol Blends in Hildreth

Cooperative Producers, Inc. (CPI) in Hildreth is one of the latest fueling stations to offer higher blends of ethanol. At their location at 201 Nelson Street, motorists have the option to fill with E15 (a 15% ethanol blend), E30 (a 30% ethanol blend) or E85 (an 85% ethanol blend). E15 is approved by the Environmental Protection Agency to be used in all vehicles 2001 and newer, while the higher blends can only be used in flex fuel vehicles. The blender pump was funded and installed in part by a grant project sponsored by the Nebraska Corn Board.

To celebrate the high octane, cleaner burning options, CPI is hosting a grand opening promotion at the location on July 17. From 11:00 a.m. through 2:00 p.m., motorists can enjoy steep discounts on higher blends of ethanol. During this time, E85 will be sold for 85 cents per gallon, while E15 and E30 will be discounted 15 cents per gallon. Additionally, staff will be on hand to help pump fuel, answer questions relating to Nebraska’s ethanol industry and serve complimentary hot dogs and soda.
Each year, NCB provides grant funds to fuel retailers wanting to upgrade to blender pumps.



Center applauds bipartisan leadership for carbon market legislation

On June 26, U.S. Reps. Don Bacon (R-NE) and Abigail Spanberger (D-VA), members of the House Agriculture Committee, introduced a companion bill to the Growing Climate Solutions Act, H.R. 7393. The Senate bill, S. 3894, was introduced by Sens. Mike Braun (R-IN) and Sheldon Whitehouse (D-RI) in early June.

The bill would standardize the agricultural carbon market, and was referred to the House Committee on Agriculture.

“These bills come at a critical time for both the agriculture industry and the environment,” said Kayla Bergman, policy associate for the Center of Rural Affairs. “They also solidify the important role agriculture plays in addressing climate change by providing a good path forward for carbon markets.”

Bergman applauded the work Bacon and Spanberger did to introduce the legislation in the House.

“Their unity showcases the bipartisan nature of this legislation,” she said. “The leadership Reps. Bacon and Spanberger has shown on the Growing Climate Solutions Act will benefit farmers across rural America in a tough economic time.”

Bacon’s Republican colleague from Nebraska, Rep. Jeff Fortenberry, joined four Republicans and five Democrats in the House in cosponsoring the bill.

The House and Senate bills seek to establish a certification program through the U.S. Department of Agriculture for private parties who work with producers to receive payments for carbon sequestration.

Right now, there are many barriers to entry in the voluntary credit marketplace for our nation’s farmers and ranchers, Bacon told Center staff.

“We hope this bill will help educate and provide help to farmers who are unsure about entering the marketplace or even where to begin,” the congressman said. “The addition of the certification program is important because it gives legitimacy to the farmers, the market, and the overall process. With a certified program, both the farmers producing the credits and those that buy the credits will trust that the market is legitimate and recognizable.”

Spangerger said she’s proud to introduce the legislation alongside Bacon.

“Central Virginia farmers and producers have a long record of successful participation in USDA’s voluntary conservation programs,” she said. “They truly understand the complex ecosystems they inhabit, and they’re proud to be stewards of the land. At the federal level, we can do more to support them as they embrace practices that both boost yields and contribute to sustainable, climate-friendly farming practices.”

In addition to bringing legitimacy to carbon trading, Bergman said the bill would make the enrollment process less cumbersome. The program has already generated interest among farmers and companies, she said.

“By providing a streamlined process, the Growing Climate Solutions Act would raise the excitement even more, giving farmers the opportunity to earn additional revenue while protecting the environment,” Bergman said.



Managing Cows through Dry Conditions
Karla H. Wilke, UNL Cow/Calf Systems and Stocker Management

Hot, dry conditions in early summer have taken a toll on grass growth in much of the Great Plains this year. There are several options cattle producers may want to consider to conserve grass in these dry areas. Every producer should have a drought plan that includes trigger dates and a culling strategy, but once those top cuts are made, what feeding options are there for the core herd?

Can I just supplement the cows on pasture and save grass that way?
Yes and no. Providing a protein supplement such as range cubes or distillers grains will certainly help the cows maintain body condition, but supplying a protein supplement will actually allow the cows to digest low quality forage better and therefore, increase forage consumption, which is the exact opposite of the goal.

However, research has shown that mixing wet distillers and poor quality forage or crop residues can replace some grass consumption, but will likely not result in a pound for pound intake replacement of grass. Most ethanol plants are back to operating at full or near full capacity, so wet distillers grains may be readily available for some producers. For more information on forage replacement on pasture see NebGuide 2099, Crop Residues or Low Quality Hay Combined with Byproducts as a Forage Substitute.

What are my options for feeding in confinement?
If a producer has February/March born calves, early weaning may be an option. This allows the producer to put the calves on a high quality diet so that the desired rate of gain is maintained, and the now dry cows will have a much lower energy requirement with the cessation of lactation, making them very easy to maintain on a limit fed diet in confinement. NebGuide G2047, Management of Early Weaned Calves, may be helpful if calves are early weaned.

If a producer has April/May born calves or simply prefers not to early wean, then pairs can be maintained in confinement, but several management issues need to be considered. Cow-calf pairs can be confined on pivot corners or fallow ground or a winter feed ground if desired. Calves will need to have access to feed as well, so supplying 2 feet of feeding space for the cows and 1 foot for the calves is important. Cows can be limit fed an energy dense diet mixed with poor quality forages but the diet needs to meet the demands of lactation. Producers can visit with their Extension personnel to develop a diet to meet the cow’s requirements. Unfortunately, poor quality residues are more difficult to digest for the young calf, so producers may want to consider a creep area for the calves where they are allowed to graze or are fed a diet higher in digestibility that is off limits to the cows. All calves need access to a water source which is important for hydration and rumen development even if the calf is nursing. Calves born in confinement in July and August might also benefit from a source of shade. For more information on managing production cows in confinement, see NebGuide 2237, Management Considerations for Beef Cows in Confinement.

Should I be concerned about the breeding season for my late spring calving cows?
Research has shown that cows breed back best on an increasing plane of nutrition. Therefore, if hot dry conditions produce grass that is mature a month ahead of schedule and grass availability is limited, then cows grazing in July and August could be experiencing a declining plane of nutrition, which could be detrimental to conception rates. Supplemental feed could be warranted, especially for the young cows nursing their first calf.

Very few cattle management decisions are easy. Culling decisions can often be clouded with emotion during difficult times. It is very important to evaluate the cost of feeding the cows as opposed to culling the cows to make the best long term management decision.



Conference on Pig Survivability Postponed until October 2021

The International Conference on Pig Survivability, originally set for Oct. 28-29, has been postponed a year. Improving Pig Survivability Project leaders said the decision was necessary due to ongoing concerns with the COVID-19 pandemic.

Conference planning chair Joel DeRouchey, extension program leader at Kansas State University, said the new dates for the conference are Oct. 27-28, 2021, and the location will remain at the Hilton Omaha, in Omaha, Neb.

“We are disappointed that we’re not able to hold this conference this fall, yet we know the decision is the right one for our attendees and our presenters,” DeRouchey said. “We’re looking forward to being able to share even more information with attendees in 2021 about how they can use current information to improve survivability rates in their operations.”

Project leader Jason Ross, who is also director of the Iowa Pork Industry Center at Iowa State University, said conference organizers took seriously their decision to postpone the conference.

“As we looked at the unknowns in terms of allowable travel by companies, businesses and universities, and other factors affecting return to normal business function due to COVID-19, our organizing committee chose to alleviate the potential risk of negative impact on the industry by postponing the conference,” Ross said.

The Improving Pig Survivability project has two primary objectives: to identify factors contributing to swine mortality in commercial production, and to develop strategies and information to reduce mortality and maximize pig survivability. Read more about the project and its progress on the website https://piglivability.org/.

“The 2021 conference objectives are to facilitate the discussion and dissemination of the most current information relative to sow, litter, weaned pig and grow-finish mortality,” Ross said. “We want to bring the industry together to motivate change while providing the tools and resources to do it.”

DeRouchey said people should look forward to continued distribution of project information.

“While the conference will remain an important component of our overall project, other avenues of information distribution such as podcasts, fact sheets, webinars and other digital media, will continue as planned,” DeRouchey said. “We are developing a strong, nationally effective extension and outreach effort coupled with innovative applied research for this project and are confident this conference will be a major piece of that effort in 2021.”

Those who have already registered for the now-postponed conference will receive a refund. Please check the conference website for more information https://www.regcytes.extension.iastate.edu/survivability/. 



Extension Specialists to Continue Essential Row Crop Management Series

Extension specialists from Iowa State University and the University of Minnesota are collaborating to provide another series of webinars for farmers, ag professionals, extension personnel and other interested parties on Tuesdays and Thursdays for two weeks in July.

The theme will be “Essential Row Crop Management for Summer 2020,” with a focus on pest management topics for late summer.

The webinars are free and open to all, thanks to sponsorship by the Iowa Soybean Association, Iowa Corn Growers Association, Minnesota Soybean Research and Promotion Council, and the Minnesota Corn Growers Association.

“Each webinar will be limited to 10-15 minutes with lots of time for questions and answers because we know peoples’ time is limited and want to be sure questions are addressed,” said Meaghan Anderson, field agronomist with Iowa State University Extension and Outreach.

Webinars will start at 1 p.m. on July 14, 16, 21 and 23. Topics and presenters include:
    July 14, 1 p.m. Tar spot identification and in-season management with Alison Robertson, professor and extension plant pathologist, Iowa State University.
    July 16, 1 p.m. Soybean aphid IPM with Erin Hodgson, professor and extension entomologist, Iowa State University Extension and Outreach.
    July 21, 1 p.m. Corn rootworm management with Ken Ostlie, professor and extension entomologist, University of Minnesota.
    July 23, 1 p.m. Soybean gall midge update with Justin McMechan, professor and extension crop protection and cropping systems specialist, University of Nebraska, Lincoln.

“Each webinar will be recorded for those that want to participate, but can’t join the live webinar,” said Lisa Behnken, regional extension educator with the University of Minnesota. Additional resources will be provided via a publicly accessible file-sharing system.

Information about this series can be found at https://extension.umn.edu/courses-and-events/essential-row-crop-management-online.

Recorded sessions and additional resources can be found in a CyBox account at https://iastate.box.com/s/wq3excfepau72nyj9pog2powqqux936v.



Production Challenges, Economic Headwinds Slow Red Meat Exports in May

U.S. beef and pork exports trended lower in May, due in part to interruptions in slaughter and processing, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). Beef exports dropped well below year-ago levels and recorded the lowest monthly volume in 10 years. Pork exports remained higher than a year ago but were the lowest since October 2019.

"As protective measures related to COVID-19 were being implemented, plant disruptions peaked in early May with a corresponding temporary slowdown in exports," said USMEF President and CEO Dan Halstrom. "Unfortunately the impact was quite severe, especially on the beef side. Exports also faced some significant economic headwinds, especially in our Western Hemisphere markets, as stay-at-home orders were implemented in key destinations and several trading partners dealt with slumping currencies."

Halstrom noted that the recent rebound in beef and pork production will help exports regain momentum in the second half of 2020. The global economic outlook is challenging, but he looks for export volumes to recover quickly in most markets as U.S. red meat remains an important staple, not only in the United States but for many international consumers as well.

"In what has been a remarkably turbulent year, consumer demand for U.S. red meat has proven very resilient," he said. "Now that production has substantially recovered, the U.S. industry is better able to meet the needs of both domestic and international customers. While the foodservice and hospitality sectors face enormous challenges, they are on the path to recovery in some markets while retail demand remains strong. Retail sales have also been bolstered by a surge in e-commerce and innovations in home meal replacement, as convenience remains paramount."

May beef exports were down 33% from a year ago to 79,280 metric tons (mt), with value falling 34% to $480.1 million, as shipments were higher than a year ago to Hong Kong and China but trended lower to most other markets. For January through May, beef exports fell 3% below last year's pace in volume (512,596 mt) and 5% lower in value ($3.14 billion).

May pork exports totaled 243,823 mt, 12% above a year ago but down 13% from the monthly average for the first quarter of 2020. Export value was $620.9 million, up 9% year-over-year but 16% below the first quarter monthly average. May exports increased year-over-year to China/Hong Kong, Taiwan and Vietnam, but trended lower to Mexico, Japan, Canada and South Korea. For January through May, exports were 30% ahead of last year's pace in volume (1.35 million mt) and 37% higher in value ($3.53 billion).



Veterinary researcher demonstrates how additives can help mitigate risk of African swine fever transmission through feed

New research at Kansas State University is demonstrating that the risk of spreading a deadly animal virus through feed can be effectively reduced through the use of different feed additives.

African swine fever, or ASF, is a rapidly spreading and emerging transboundary animal disease that threatens pork production and human food security worldwide. Although African swine fever virus does not affect humans, it has reduced pork availability in some countries with afflicted pigs.

The K-State research team, headed by Megan Niederwerder, assistant professor of diagnostic medicine and pathobiology in the College of Veterinary Medicine, has just published a new study, "Mitigating the risk of African swine fever virus in feed with antiviral chemical additives," in the scientific journal Transboundary and Emerging Diseases. This study provides the first evidence that feed additives may be effective tools against African swine fever.

"Over the last two years, ASF is estimated to be responsible for the death of at least 25% of the world's pig population due to the emergence of the virus within China and subsequent spread to over 10 other Asian countries," Niederwerder said. "In 2019, we published the first report of African swine fever virus, or ASFV, transmission through the natural consumption of plant-based feed. Our subsequent work has focused on mitigation of ASFV in feed through the use of chemical feed additives and heat treatment."

Although feed additives have historically been used to reduce the risk of bacterial contamination in feed, research thus far has not reported efficacy for the inactivation of African swine fever virus in feed ingredients. Niederwerder said there are currently no commercially available vaccines and no effective treatments that can be administered to pigs for ameliorating disease caused by the virus. Thus, control of African swine fever is focused on biosecurity measures to prevent the introduction of the virus into negative countries or negative farms and regions within a positive country. The other method of containment would involve large-scale culling of infected or high-risk animals to contain the spread of the virus.

"Our new research reports novel data evaluating the efficacy of feed additives on inactivating ASFV in an in vitro cell culture model and a feed ingredient transoceanic shipment model," Niederwerder said. "This will provide valuable information to the swine industry with regards to mitigating the risk of potential routes for introduction and transmission of ASFV through feed and ingredients."

Niederwerder and her team examined two different classes of liquid feed additives, including a medium-chain fatty acid-based additive and a formaldehyde-based additive, for efficacy against African swine fever virus in cell culture and in feed ingredients. In general, both chemical additives demonstrated evidence of reducing the virus infectivity, with data supporting dose-dependent efficacy.

This study was funded by a grant from the Swine Health Information Center and the State of Kansas National Bio and Agro-defense Facility Fund.

While the results of the study are promising, Niederwerder emphasized the need for a multifaceted approach to reducing the risk of African swine fever virus in feed, including sourcing ingredients from countries without the virus when possible, applying holding times to high-risk ingredients, and implementing consistent biosecurity protocols at the feed mill.



Livestock Risk Protection Changes
Matthew Diersen, Risk & Business Mgt Sp., South Dakota State University

July 1 marked the beginning of a new commodity year for Livestock Risk Protection (LRP), a price insurance product that functions similar to buying put options. As such, LRP is designed for the seller of cattle facing downside price risk. An LRP policy has endorsements for fed cattle and feeder cattle, the latter with adjustment factors (built in basis levels) for certain weights and classes. Two major changes were implemented for LRP, the premium subsidy was again increased and the premium payment date was moved from the time of purchase until the end of the coverage.

The LRP subsidy was substantially increased a year ago, with limited impacts in terms of volume of cattle covered. For Fed Cattle, there was an increase in the number of head covered in the 2020 commodity year to 8,098 head across 62 paid policies. However, that low aggregate volume implies that the premium has not been a driving factor in the use of LRP by feedlots. For Feeder Cattle, there was a decrease in the number of head covered from the prior year, down to 79,846 head across 393 paid policies. Sales volume continues to be steady for feeder cattle, especially from South Dakota down to Texas. The higher volatility in 2020 has resulted in sharply higher premium levels, so the subsidy is more relevant at this time.

A common question is how costs compare if considering buying LRP versus buying a put option. Before the subsidy changes, costs were often similar when comparing the alternatives on a per-cwt level. Consider a cost comparison from July 2, 2020 under the current subsidy structure. LRP on feeder cattle for the standard weight class had premium quotes for an October 29, 2020 end date. The highest coverage level available was $136 per cwt at a full premium cost of $6.82 per cwt. The subsidy (25% for this coverage level) would reduce the cost to $5.12 per cwt. A $136 strike price October put option on the same date settled at a premium of $6.00 per cwt. The premium would not include any commission costs, which could add $0.15 per cwt. As a settlement price, it does not reflect the bid-ask spread or how much may have to be included to get an order to fill. Note that the fixed size of option contracts may give LRP an additional cost advantage as it is purchased on a per-head level. The take-home message is that the subsidy would give a solid cost advantage to LRP.

Changing the time the LRP premium is payable, is more subtle, but still relevant. When buying options, having to pay the premium can use a substantial amount of financial capital. Lenders are often willing to lend the necessary capital, but then interest will add to the expense. In some cases, borrowing may use valuable credit reserves. Interest rates are generally low at this time, so explicit interest expense or the opportunity cost of capital are likely low at this time. Regardless, the change would again give a cost advantage to LRP compared to buying put options.

For more insights, see https://extension.sdstate.edu/livestock-risk-protection-cattle. 



RESEARCH ENHANCES UNDERSTANDING OF THE NUTRITIONAL AND ECONOMIC DIFFERENCES IN SOYBEAN MEAL FROM DIFFERENT ORIGINS

A new meta-analytical study reinforces U.S. Soy’s reputation for being a global leader in quality and nutrient-density. The study, entitled, “Chemical composition, protein quality and nutritive value of commercial soybean meals produced from beans from different countries,” demonstrates that not all soybean meals are created equal and that meal from different countries of origin should be treated individually when formulating swine and poultry diets. The data from this study were then processed by the Nutrient Value Calculator (NVC), a software tool constructed by Genesis Feed Technologies, a company built to bring visibility into feed costs. This cost analysis supported the economic benefits of U.S. soybean meal relative to meal from other origins as a key ingredient in poultry rations.

Dr. Gonzalo Mateos, Professor of Animal Science at the University of Madrid in Spain and study co-author, first presented findings from the meta-analysis at the U.S. Soybean Export Council’s (USSEC) Asia Trade Exchange to 850 U.S. Soy customers and soybean industry representatives. This pioneering compilation of research is the most comprehensive quality review of soybean meal that has ever been conducted, and it gives customers greater clarity around soybean meal quality from different countries of origin. The meta-analysis looked at 18 different studies and 1,944 samples to quantify the relationship between country of origin of the bean and the chemical composition and nutritive value of the soybean meal. Soybeans from the following origins were analyzed: Argentina (ARG), Brazil (BRA), USA (USA) and India (IND).

“One of the main points from the study, is that customers should be using different matrices for the evaluation of the nutritional value of soybean meals of different origins,” said Dr. Gonzalo Mateos, Professor of Animal Science at the University of Madrid, Spain. “If they buy only based on protein or vegetable sucrose content, they may buy a product that is actually lower quality. Therefore, it is important to check all of the values that are related to the nutritive value of the soybean meal before making purchase decisions, which this study addresses.”

The data in this meta-analysis forms a new key pillar of the economic evaluation of soybean meal in global markets. Using the Nutrient Value Calculator from Genesis Feed Technologies, the economic value of U.S. soybean meal can be evaluated in global markets using formulas representative of the regional feed manufacturers. Nutrient values and prices of all the other components of the diet are also used in this calculation. The NVC indicates that U.S. soybean meal is the leading contributor to cost reduction in broiler diets.

“Our company was thrilled to participate in this groundbreaking research conducted by the U.S. Soybean Export Council,” said Peter Schott, CEO and Co-Founder of Genesis Feed Technologies. “We hope that buyers take note of the results, purchase more U.S. soy and see a significant reduction in their feed costs. This NVC analyzes economic nutritional value of soybean meals from different origins to give traders and buyers a platform to connect with nutritionists directly to better inform their feed investments.”

When comparing cost reductions with incorporation of data from the aforementioned meta-analytical study, premiums of U.S. soybean meal range from $14.57 to $23.24 per tonne over Argentine soybean meal and range from $2.48 to $10.26 per tonne over Brazilian soybean meal.

“U.S. soy and soybean meal products offer a price advantage and rank first on a number of important nutritional attributes when compared to other origins, including remarkable amino acid and energy profiles,” said Paul Burke, USSEC’s Senior Director for U.S. Soy Marketing. “This will continue to ensure we deliver a valuable, consistent and more economical product that our customers can count on.”

Soybean meal is an important source of protein for the global feed industry, where it is used in livestock, poultry and aquaculture diets. To meet this demand for animal feed, the farmers that grow sustainable U.S. soy not only care about being a reliable supplier but take pride in providing a high-quality product to their international customers.

“The world’s need for a high-quality protein product like U.S. soybean meal will be critical as our population continues to grow. And U.S. farmers around the country are ready and willing to meet that need,” said Monte Peterson, Chairman of USSEC, board member of the American Soybean Association and soybean farmer in Valley City, N.D. “Our soybean farmers provide a consistent, nutritious and efficient source of protein for both the food and feed sectors. This meta-analysis is important because it shows how U.S. soy is the most high-quality and best economic choice, backed by science.”



COVID-19 Pandemic Reveals USDA Is Not Buying RFID Cattle Eartags from American Manufacturers   

R-CALF USA has learned that the COVID-19 pandemic has disrupted foreign shipments of millions of radio frequency identification (RFID) cattle eartags the U.S. Department of Agriculture (USDA) had purchased from foreign manufacturers. The USDA had planned to distribute the millions of foreign-made RFID eartags free-of-charge to American cattlemen to entice them to begin using the foreign-made RFID eartags on American cattle.

R-CALF USA Animal Identification Committee Chair Kenny Fox said his organization finds this news disturbing, particularly in light of the Executive Order issued by President Trump in April 2017 that directs federal agencies to “Buy American and Hire American.”

“The USDA is contributing to the weakened state of our U.S. economy by bypassing domestic supply chains, particularly domestic manufacturers, in its blind pursuit of attempting to force expensive and foreign RFID technology on America’s cattle producers,” he said.

Today, the USDA published a proposal in the Federal Register wherein APHIS would only approve RFID tags as the “official” eartag for any livestock sold or moved across state lines. The purpose of this proposal is to entirely phase out the use of any other type of eartag, and force producers to convert to the RFID technology.

The USDA purports that such a mandate does not alter current law, and the agency indicates it does not intend to change current law by amending its regulations.

However, R-CALF USA states that the USDA’s actions contradict current law that expressly allows cattle producers to choose among various identification devices, including metal eartags, as well as backtags, brands, tattoos, and group lot identification.

“This is yet another end-run around the 2013 regulation that allows producers to use a variety of identification and traceability techniques,” Fox said. He also pointed out that an agency policy such as this cannot trump existing regulations and the USDA appears to be on a fishing expedition to force the cattle industry to expend unnecessary resources to fight a proposal that the agency has no authority to implement.

In October 2019, R-CALF USA represented by Harriet Hageman of the New Civil Liberties Alliance, filed a lawsuit that successfully blocked the USDA’s first attempt to unlawfully mandate the exclusive use of RFID eartags.

“The agency is completely out of touch with the needs of America’s cattle producers who are experiencing perhaps the worst economic cost-price squeeze in history, which has been greatly exacerbated by the COVID-19 Pandemic,” Fox commented.

“This is certainly not a time the USDA should be imposing significant added production costs on the U.S. cattle industry and not the time to be enriching foreign manufacturers at the expense of domestic manufacturers while the entire domestic cattle and beef supply chains are reeling from the effects of the pandemic,” he added.

Fox said his group is urging every cattle producer to submit comments to the USDA before the October 5, 2020 deadline to inform the USDA that it cannot force expensive RFID technology upon the industry without amending current law.

Interested persons can comment on the USDA’s proposal by going to the Federal eRulemaking Portal at https://www.regulations.gov/document?D=APHIS-2020-0022-0001.



Signup for 2021 DMC Coverage to Begin Oct. 12

The USDA's Farm Service Agency announces that Dairy Margin Coverage safety-net signup for 2021 coverage will begin Oct. 12 and will run through Dec. 11. Due to the impact of COVID-19, the program has already triggered payments for two months for producers who signed up for 2020 coverage.

As of June 15, FSA has issued more than $100 million in much-needed program benefits to dairy producers who purchased DMC coverage for this year.

Authorized by the 2018 farm bill, DMC is a voluntary risk management program that offers protection to dairy producers when the difference between the all-milk price and the average feed price falls below a certain dollar amount selected by the producer. Over 13,000 operations enrolled in the program for 2020.

For more information, visit farmers.gov DMC website or contact your local USDA service center.