tv U.S. Farm Report NBC February 14, 2016 6:00am-7:00am CST
good news on the demand side of the equation. our marketing discussion is straight from the national farm machinery show in louiseville, kentucky. now for the news that moved the markets this week, usda out with its latest crop forecast.with bigger stocks and weaker demand, the report just adding to the already bearish tone in the market. breaking down the numbers, first looking at ending stocks. usda raising its corn, soybean and wheat forecast. usda thinks we'll have 10 million more bushels of soybeans. that pushes the total to 450 million bushels on lower crush numbers. the agency also raising corn stocks, but by 35 million bushels. and wheat stocks upped 25 million bushels, which is the largest in
exports since 1971 and 72. the forecast is for 775 million bushels, a 25 million bushel drop from the previous report. pork exports finished strong in 2015 while red meat struggled. taht's according to the latest numbers out of the u-s meat export federation. the white meat's exports saw the largest volume since april, up 3 percent in december from year ago levels. on the year, pork exports still ended in the red, down 2 percent. c-m-e annoucning ths week it wants to shorter livestock trading hours. if approved by the c-f-t- c, the new hours will be 8:30 a-m , to 1:05 central for futures and options, monday through friday then open outcry hours will be 8:30 to 1; 02. c-m-e says about 87 percent of livestock futures and options trade during those hours. the world dairy market is facing oversupply, and that's not good news for milk prices. just this week, prices at the global dairy trade auction in
are seeing a little bit of extreme drought there popping up in western portions of montana as it gets dryer there. the worst area of california, nevada continues to slowly shrink, but it is still taking a while as it does with long term drought we are also starting to see some pockets of slightly dry conditions in texas now. let's go day by day this week: we are going to see some systems moving across the country, this is going to be a pretty impressive one--it is either going to move up into the ohio valley or along the east coast, so keep that in mind as these two come together, but on monday it's going to be just light snow across the northern plains into the great lakes, little bit of snow in the mid-atlantic there some rain ahead of this system through northern dixie, showers maybe a thunderstorm farther south from there, slight snow back across the plains, but again on tuesday those two kind of combine a little bit, but by wednesday that main storm is all the way up in maine where rain is turning to snow in the northeast
snow around the great lakes another system coming in out west. most of what is coming this week is going to affect the northwestern part of the country that will be the case on friday again another chilly area of high pressure coming into the middle of the country, but the system moving through the great lakes actually some rain in places for a change, back in our next half hour with a longer range outlook. thanks, mike. when we come back, we're off to the national farm machinery show in louisville, kentucky for this week's market discussion.
kubota hay tools. forage forward. welcome back to u.s. farm report. well, as promised we're here at the national farm machinery show in louisville, kentucky. each year we have a great crowd, and this year is no different, a really good crowd this year. all right, let's jump right into the questions. joe vaclavik, i'm going to start with you. usda's latest report came out this week, showed we had quite a few demand problems. >> yeah, the usda earlier this week kind of reiterated what we already know about these markets, and that's we've got a demand problem. even though the corn market, the soybean market, the wheat market are at pretty low prices relative to where we've been the last several years. demand is still a big problem. export demand in particular is one of the big, big problems. the strong u.s. dollar has really hindered export activity, so we saw the government reduce their projections for corn exports and for wheat exports. in the
exports, but i don't know if you guys know this, but soybean processors here in this country account for about half of the soybean demand, and their margins are really bad moving forward through the end of the year, so they reduce that estimate. so not anything surprising, just kind of reiterating what we already know, i guess. >> yeah, i mean, steve, joe hit on it a little bit. we were promised when we got lower prices that would entice demand, but it's just not happening at the rate we would like. >> no, that's exactly right, and joe talks about exports, corn exports, and you look at both corn and soybean exports and look at that rate, and it looks very, very likely that the usda's going to have to lower exports on both corn and soybeans going forward. they're probably going to reduce crushes more and, joe pointed out very well, crushed margins are really both on the board and cash have really dropped off substantially just in the last couple months. and i think if you look if we would have had this three months ago we'd have a different story than we have today. >> bob, if we do reduce demand, another bearish to put on the fire another bearish tune here, so what moves prices
lower those numbers probably april, maybe the aprilay report right when we're planting the crop, so we got spring planting. the crop's getting planted increase we don't actually raise the prices until we get potentially to late may, early june, and it's called supply weathercare markets, and i've been around a few years as it was pointed out. i'm one of the older ones now, and one of the things i've noticed for farmers is their achilles heel is taking advantage of supplyriven bull markets. it's very difficult in the third or fourth week of june when you plant in the second week of may and it hasn't rained in three weeks and it's 95 degrees and it's lock limit up on friday and you've got a big margin call to sell next year's crop. and that's what you're going to be able to mentally get prepared for now, is how are you going to take advantage of the opportunity if it develops? >>
'16, '17, even '18. >> let's get rid of '14 and '15 if we can. [ laughter ] yeah, that is a problem but, yes, i'm trying i'm being satirical, but, yes, basically i want to make a multiyear sale, but mentally saying it in january's easy. doing it in july is extremely difficult unless you have a very rigid process. >> how likely is it that we do get a boost in prices this summer? >> well, what i will say is i don't believe 2012's walking through that door again. i don't think corn's going $8 this summer. i know there's been a lot of talk about a potential weather issue. as a farmer and somebody running a business you can't set up your operation for a weather scare this summer. there's a saying that traders tell me all the time. they say, you've got to trade the market you've got and not the one that you want. and we've got a market here that's low volatility. if we do get some kind of weather scare similar to what we saw last year. you've got to remember the kind of marketplace that we're in right now. this isn't 2012 or '13 again. this is a
to have to take advantage of opportunities very quickly. >> steve, another thing right now that could move prices higher is a reduction in acres, but it doesn't sound like a lot of folks think were going to see that. >> no, and it's exactly right. we're looking probably about 90 million acres of corn, maybe half a million, maybe as much as a million acres less than beans, and obviously we know what's going on in the wheat market right now, so we don't see a reduction in acres, and the fact is, look at yields, the yield potential. you're going to go to corn because that's where your most opportunity revenue side is. >> real quick before we have to go to the break, we going to have trendline yields below, above? what do you think? >> i think there's as great of risk for above trend as there is below trend. >> steve? >> yep, i would agree. i think we could potentially be below trend this year. >> joe? >> no reason to think it's going to be anything other than trendline until we get into planting and some weather. >> all right. we need to take a short break, but a lot more to talk about, so don't go anywhere. we'll be right back on
brought to you by acuron corn herbicide from syngenta, putting you back in control of tough weeds. by mud hog, pioneer in hydraulic drive. celebrating 40 years of powering your harvest. 200,000 farmers know. and by kubota hay tools. forage forward. welcome back to u.s. farm report. okay, bob, during the break you had you said something about 2012. i think our audience needs to hear it. >> in 2012 the market had the previous high in august, sold all the way through spring. may and june low for the december contract was lower in june, april, may than it was in january, so you got to go lower before you go higher, and you have to have this year we've learned now the guys can produce a crop, even stress, so i think the market is going to have to have confirmation of whether not
corn yield. ten bushel off trendline. >> okay, all right. joe, on thursday of this week pretty poor performance in some of the outside markets when we look at oil and other things, but, yet, corn didn't perform so badly, so that was kind of a bullish factor. do you have any comments on that? >> well, the outside markets haven't been a really great influence here over the short term. big picture, you know, as i talked earlier the strong u.s. dollar is really a killer for these markets, but short term we've got a lot of panic going on in the outside markets. if you watched what the u.s. bonds did today, they posted some new highs. there's a lot of fear of this interest rate situation. a lot of the governments overseas have gone to a negative interest rate. we're seeing a big break in the value of the u.s. stock market, so with all this panic in the outside markets i would probably argue that the grain markets are either just indifferent or they're holding up pretty well,
towards indifference at this point. >> when we look at some of the other countries, specifically argentina, more products coming out of argentina, what if we continue to reduce soybean tariffs and other things. what does that do to our ledger? >> well, i think it definitely puts a lot more pressure on prices than we've seen. argentina the last five or ten years really hasn't been part of the conversation. it's been u.s.brazil, when you think about soybeans, and now argentina with reduction of export taxes, reductions of export permits, basically limiting export permits, and of course the 30% devaluation of the peso has made argentina much more competitive in the world and going to put a lot more pressure on corn, soybeans and wheat prices globally. >> china, bob? >> they're in a slower path rate. they're not going back to 5%, 9%, 8%. they're going to 4% and 5%. i think they'll stay in 4%, but i'm concerned they're going to focus more on wheat and beans from south america, and we're going to be as rich of a supplier to them. i think the growth long term now is going to
term growth path and problem is that's where the population increase is going to be at, but are they going to have the economic base to pay for it? and that's one of the big problems the bull's argument for the next several years is population increase is increasing. we need more food. as earl butz once said, you only have demand if you can afford to pay for it. and that's the question, do we have the global economic base to pay for the food that we need? and that's going to be one of the challenges, i think, ahead. so there's no knight in shining armor coming to our rescue and demand in the immediacy. it's all supply driven to create higher prices. >> i want to end on livestock, so i'm going to come back to you, joe. before we do that, usda came out there week, projections on farm income. we're looking at 56% lower than the high we saw in 2013. not good news. what's your advice for producers in this graph? >> yeah, this is a tough situation, and we all know that in this room. we've talked a lot with farmers this winter in talking about managing the margins. the question may not be the right question not to
cost to produce that bushel of corn or that soybean, whatever the case may be, and then manage the margin accordingly. it may not matter to you whether corn goes to $4.50, $5. if you have a margin there and you can sell it for $10 or $4.20 and it makes sense for your operation, you have to do that. you have to manage this as a business, and as being an old commodity buyer myself, that's what you have to worry about. what are the margins? that's the important thing now. >> some good advice. thanks, steve. all right, joe. this week cme proposed new livestock trading hours, and there's been a lot of eyes in the livestock market and the volatility there. so do you think a reduction in hours helps or hinders that market? >> it's wonderful. it's the best thing cme's done in a long time. the story, if you don't know it, is that the livestock during the week, they trade from 8:00 central time up until all the way to 4:00, and they do this little deal where they do the settlement at 1:00, but then we trade for another three hours. so what they just did here recently was they cut off that extra three hours. in that three hours we were seeing low
so they're going to do away with that, and i'm a big fan of the change. i think most people in the industry probably are as well. >> real quick, not much time left. livestock prices, let's specifically look at cattle. are we going up or down? >> long term, cheap grain brings cheap hogs and cattle. take advantage of all big bounces to sell, lock in your profit margin. i think margin compression in the livestock is the guidance. if you can lock in a profit, don't get locked up in the flat price. take advantage of seasonal bounces, but cheap corn will bring cheap hogs and cattle. >> you agree with that, joe? real quick. >> yeah, and maybe from a different view. i think that the cattle and the feeder cattle are very high priced historically still. every other commodity's down in the dumps right now. that's the risk is that the cattle join along. >> okay, all right. thank you, we're going to get your closing thoughts, so don't go anywhere. we'll be right back on u.s. farm
crude oil. some of the energies and some of the other commodities in going down to historically lower levels than we're at right now. prepare yourself for worsease scenario. picture this. the value of the dollar rallies up to about $105 or $110, crude oil drops to $15, where's corn going to be? it's not going to be at $380, so prepare yourself. >> all right, thanks. steve nicholson? >> i think on corn and look at corn and soybeans and wheat altogether, i think we've probably set a bottom in for this year. we may see lower levels when we get to production, but the fact is we're not a lot of volatility. so as bob and we've talked about earlier, you see opportunities in that market pops, that's probably your opportunity to get some stuff sold. >> yeah. bob utterback? >> continue the theme. prepare yourself now. how you going to take advantage of this summer, junejuly weather event? not only for your old crop in the bin, for the crop in this '16 and maybe consider '017 sale, but do it in an organized way. >> all right. thank you all for being here with us. please stay with us, john phipps joins us when we come back. >> receive a free trial of the daily market letter
can't relate. but he does have some things for you to consider. it's the weekend for the game-which-must-not-be- named. as i revealed recently when i talked about downton abbey, i do not follow sports much and football even less. but i do know that a growing part of the tradition around super sunday is the commercials. one of the primary purposes of these ads is apparently defining what masculinity is and what it takes to be a real man. the fact that i have not been tuning in annually could explain a lot then. maybe these portrayals of how men should act are helpful to set standards of conduct or
that conclusion. but from the questions i have been hearing from farmers - especially younger ones - as i speak to audiences across farm country, the economics of agriculture have placed new importance on guidance on male behavior for producers who have never seen a downturn like this. because so many of us work with fathers, uncles, and other older male relatives, we will be taking clues from those more senior colleagues about how to conduct business, partner with spouses, lead families, and connect with friends. during stressful times, it might behoove those of us with a few miles on our odometers to keep in mind younger eyes are on us all the time. i have no great pearls of wisdom to define a code of conduct, but i have learned from my own experience that even casual words and thoughtless remarks can have lasting impact, both positively and negatively. those i watched during my
their examples and how helpful their encouragement was when i told them years later. so maybe the commercials are right. picking the right deodorant or beer, driving the right vehicle, and attracting the right women could be the clues to true masculinity, but for me the real men whose examples guided me through rough times were by comparison, dull: they were modest, cheerful, and honest. and my guess is seeing those qualities in action might be helpful to younger farmers this year. thanks, john. could this year be your last chance to get a deal on farmland? our farm journal report shows us where experts think the land market is going. that's after the break. the chevy silverado is the official news gathering vehicle
from the studios of farm journal broadcast, this is u.s. farm report. welcome back to u-s farm report. we have much more ahead over the next 30 minutes. land prices didn't see a bubble. but have we hit bottom? that's our farm journal report. a viewer has a comment about top producer winners and that size shouldn't matter. and we'll head out west to visit baxter black. now for the headlines, as farmers and ranchers brace for another year of low commodity prices, usda thinks net farm
releasing it's projections for net farm income in 2016. it expects another 3 percent decline to 54 point 8 billion dollars. that's the lowest level since 2002. if realized, net farm incomes will be 56 percent lower this year than it was during the record high year set in 2013. cash receipts expected to drop 9 point 6 billion dollars..nearly 8 billion of that in the animal and aniimal product category. as farmers face lower income, federal crop insurance is on the chopping block again. the obama administration releasing its 2017 budget proposal, calling for 18 billion dollars in cuts. those would happen over 20 years. in december, congress rejected efforts to cut crop insurance by 3 billion dollars over two years. the senate ag committee chair pat roberts is calling the bill dead on arrival. on the heals of usda annoucning it can't declare cotton as an oilseed, the national cotton council releasing its annual plantings
1 million acres of cotton this spring. that would be more than 6 percent higher than a year ago. n-c-c expects cotton exports will drop 15- percent from last year. much of that decline is due to china's shrinking demand for cotton. usda is giving more than 20 million dollars to help with a fatal disease in florida's orange crop. usda says it will put 20 point 1 million dollars towards research and extension prodjects to help fight it. detecting the disease can be difficult, because symptons start below ground first.. usda recently lowered its estimate for the 2015- 16 orange crop to 69 million boxes. that's nearly 30 percent less than last season and the smallest more than 50 years. the head of the epa finding heelf in the hot seat thursday...appearing before the house agriculture committee to discuss a host of regulations and hot button issues. while respectful, the discussions and questions posed to epa head gina mccarthy were pointed and frank. the e-p-a's waters of the u.s. rule are major point of
for its use of social media to promote the rule. congressional leaders making a point to encourage the e-p-a to listen to and work with farmers and land owners as they pursue rules that impact their livelihoods. that's it for news...meteorologist mike hoffman joins us now with the longer range forecast. mike, we're starting to look at planting conditions. thanks, tyne. obviously the farther south you live the better chance you have at planting sometime in the near future, the rest of you farther north not so much. you can see the trough over the eastern part of the country, digs in again as we head into this week and then a ridge comes by for a three or four day warm up quick shot of chilly air there as we head through the end of the week and then some colder air coming our way as we head into early next week for the great lakes and the northeast. we will just have to watch things though at least we do
right now. the ridge out west will keep things off shore for the most part not going into southern california like we have seen. 30 day outlook for temperatures: above normal for california on up into montana, below normal texas into the northeast and most of the southeast precipitation below normal from the ohio river through the great lakes in the northeast same thing in the northern rockies, southern tier of states that will be where you have above normal amounts of rainfall, tyne? thanks, mike. federal reserve district banks in the nation's midsection releasing their quarterly and year- end reports on farm incomes and land prices, showing more softening in the market. the chicago fed - representing most of the cornbelt - shows farmland values for 2015 decreased three percent from the previous year. this is the second straight year for an annual decline. the chicago fed says the last time that happened was during the 1980's. in the st. louis district - covering the southern corn belt and mid-south - values on quality farmland fell about two and a half percent in the last quarter. . ranch and pasture land also saw a decline, of about five percent. and in the kansas city district - which covers much of the central
cropland down 4-percent. irrigated down two percent.from a year ago. so, have we hit bottom in land prices, and does that mean now is the time to buy? in this weekend's farm journal report, we explore the landscape for land prices in 2016 and beyond. parcels of opportunity. this soil may not be worth what it was three years ago, but experts say, that means 2016 is the year to buy.
been boslstering it in 2015, but not having that cash on hand is ggoing to force them to do some adjustments at the end of 2016> cash leases are a different story, not falling as fast. but henderson expects those prices will see a correction in 2016, as well. so, where do prices go from here? walsten says traditionally, land prices experience a 4 to 5 percent increase every year. and 2017 could see the same.
continue to run those feature stories the next couple months. but one viewer has a comment about this years' finalists. and john phipps is here to answer. john. dave fenn from curtis washington comments on our top producer of the year story: "your award winners are always the really big guys i would think you could find a number of "modest" sized operations where the owner actually gets his hands dirty, not just sitting at a desk and driving his pickup around. there have to be "top producers" from out there that are not huge." dave, your comments echo our own concerns at top producer. but while our winner this year was a very large operator, check out the stories of the the other finalists when we broadcast and publish them later this year. not all were huge. the automatic
- not just for this contest, but for our industry. i had a chance to visit with the family that won, and i have some troubling news - it was impossible not to admire their character and integrity as people and farmers. we forget that the same virtues we extol in small family farms are the ones that are likely to make them successful and help them grow. good people should do well, if our system is working. it does not detract from small farms when large farms are run with equally high standards of conduct. i also understand your point about desk-work and real work, but think that false comparison should have been left behind in the last century. it is my experience that driving the combine or repairing machinery is the reward for the more demanding tasks in front of a computer or in negotiation or supervision. after all, if desk work wasn't real work, we
success in the technology-intensive agriculture of the future, in my opinion. nor is our industry unique in this transition. we would love to see more mid-size and small farms as top producers of the year, and there are no judging criteria that rule them out of the top spot. if more producers of all sizes would simply take the time to enter, i think you would see that the top producer of the year could be any size. thanks, john. feel free to email your comments or question in to john at mailbat at u-s farm report dot com. don't go anywhere. baxter black joins us next.
paths befell a crossing, a trail lay to waste, like 40 rhinos passed by pulling plows. "you?" i ask. he nodded. i was out here yesterday. i had to pull a calf. i came straight from town, but i used my regular method what i call a hook and chain where i sneak up on them when they are laying down. and then i chain their little foot up, slip the hook onto the link, the big one on the end. you know the one i mean and then i put my boot into it, always keep the pressure tight, that way they don't get up till you are done." a hook?" i ask. "what kind of hook?" from the rubble on the floor he fished a good sized hay hook from the mound. it was older than grandma's photos and no doubt it was hand made. it looks like some old stirrup that
boot here in the hook and push against her when she starts to strain. i get quite a bit of leverage, but they never do get up as long as i keep the pressure on the chain." "i see," i said. though i didn't. i looked back across the trail. i could picture what happened in my mind: when the old cow put the country through the cactus and the rocks, with mr. dewey dragging along behind. "well, that explains the nasty bruises and the gash there on your ear. but what went wrong to sabotage your plot?" "well, i was wearing city foot wear. not my boots like i should. it slipped right through the handle and i got caught, but you know they never get up if you keep the pressure on--i have proven that a million times. i will show you if we spot one that is in need of our assist. i have got the chain hook here upon the floor." i glanced down to the floor
now," he said. "just look." "well, so what?" i said suspicious. "well, i see you are wearing mud boots." that old dewey handed me the hook. this is baxter black from out there. you can wach more of baxter by visiting baxter black dot com. when we come back, tractor tales and our country church salute...please stay with us.
so it's a pretty international harvester tractor. they made moguls and then they turned them in to internationals after quite a few years, but this is an 816 which means that it is eight horse power on the draw bar and 16 on the belt. it was made originally to start on gas and then change over to kerosene or dist-lit it was donated to this club quite a few years ago, pretty rough condition and i took it home and now we went through everything that we needed to get it running. we just basically tore the engine down. it was all here and all complete. the toughest thing was the cylinder head- -it had been froze up and broke and great big chunks broke out of the cylinder head. we had to build new valves. you don't go down town and buy any parts for this thing, you got to build them. it takes some power to turn that fly wheel it has got some pretty
set the decompression and do everything right it doesn't start too bad, but it takes a lot of horse power to get that fly wheel turning, but it has still got the original tags and cereal number and everything--it's kind of neat. but we knew nothing about how to run it; we had to learn it all. it was quite an experience starting it up for the first time, because it back fired a few times. we didn't have the timing just right. it sounded like a shot gun. we didn't know whether to hit the deck or not. this week, we would like to pay tribute to the swedesburg evangelical luthern church in swedesburg, iowa. the church has 575 members, who will all be celebrating the church's 150th anniversary in april. it was charted by 60 swedeish immigrants one year after hte
on twiter with the caption, "just another day in paradise." loading grain is not nearly as much fun in the dead of winter, but at least he had a veiw from the top. they told us they got some more alke effect snow this week. some of our producers were in north dakota last week for our taping. and while the winter storm nearly trapped them in minneapolis on their way home, north dakota was not as packed with snow as it usually was.
and the almond trees in chico california are waking up, after and the almond trees in chico california are waking up, after days, and when she returned home, the buds welcomed her back. that means the bees are preparing for pollination season and it will soon be udnerway. jenny says they've had some nice rains this year, and that those showers can keep on coming. and before we go, teh girls just wanted to tell everyone happy valentine's day in their matching outfits and bows. as always, we want to hear from you, send comments to mailbag-at-u-s-farm-report-dot- com or check us out on facebook
to nominate a successor in due time. >> republicans pushing back, arguing it is a job for the next president. the issue front and center on the debate stage. >> it is called delay, delay, delay. >> i do not believe the president should appoint someone. >> will this fight paralyze washington even further? what about the key cases in front of the supreme court right now? we're live with it all. dangerous and deadly. another day to stay inside. bone chilling temperatures affecting up to 90 million people, the coldest negative 34 in western new york. the weather now responsible for several deaths after a major pileup in pennsylvania. dylan has your forecast and there is some relief in sight. cover girls. not one, not two, but three "sports illustrated" swimsuit covers. the magazine highlighting beauty in many forms this year, including a plus size cover model. why "si" decided to make history