Last week, in its monthly Grain: World Markets and Trade report, the USDA’s Foreign Agricultural Service (FAS) explained that, “Trade data for 2019/20 (October-September) are largely complete. Many countries imported record volumes of corn, despite initial concerns over a potential slowdown in feed use due to COVID-19.”
Farm Policy News
Legal Issues Surrounding RFS Small-Refinery Exemptions Persist
On Tuesday, DTN’s Todd Neeley reported that, “A coalition of ethanol and agriculture interests asked a federal court on Monday to vacate EPA’s granting of 31 small-refinery exemptions in 2018, alleging the agency did not conduct the proper review of those requests.”
Corn Exports: Chinese Pigs, American Crops- “Increasingly Interdependent”
On Monday, Reuters writer Dominique Patton reported that, “Behind the walls of a hulking industrial compound in rural China, top pig producer Muyuan Foods is trying to raise more hogs on a single site than any company in the world – a risky investment with deadly African swine fever lingering.”
La Nina, A “Supply-Side Wild Card,” Could Impact Markets Into 2021
Wall Street Journal writer Lucy Craymer reported late last week that, “La Niña is shaking up agriculture in an already-tumultuous year for commodity markets.”
Farm Income: Better Market Prices Likely Not Enough to Offset Expected Subsidy Reductions
Donnelle Eller reported on the front page of Friday’s Des Moines Register that, “Mid-Iowa Cooperative’s Mike Kinley sees a $275 million soybean processing plant under construction in eastern Iowa as a way for farmers to get more money for the crops they grow.”
Federal Reserve: Observations on the Ag Economy- November 2020
On Wednesday, the Federal Reserve Board released its November 2020 Beige Book update, a summary of commentary on current economic conditions by Federal Reserve District. The report included several observations pertaining to the U.S. agricultural economy.
2020 Farm Sector Income Forecast, December
The USDA’s Economic Research Service (ERS) indicated on Wednesday that, “Net farm income, a broad measure of profits, is forecast to increase $36.0 billion (43.1 percent) from 2019 to $119.6 billion in 2020.”
Record High U.S. Red Meat Production in October
Bloomberg writer Dominic Carey reported earlier this month that, “U.S. red-meat production surged to a record in October, months after the coronavirus disrupted slaughterhouses.”
China Imports of U.S. Corn Next Year Could Hit 30 Million Tons
Bloomberg News reported late last week that, “China is set to import more U.S. corn, with volumes for next year seen hitting the top end of market expectations and squeezing global grains prices.”
USDA Agricultural Trade Outlook- FY 2021 U.S. Exports Forecast Up $11.5 Billion
On Monday, the USDA released its Outlook for U.S. Agricultural Trade, a quarterly report from the Department’s Foreign Agricultural Service (FAS) and Economic Research Service (ERS).
Factors Taming China’s Demand for Imported Pork, as Supplies Build in Europe
Wall Street Journal writer Lucy Craymer reported late last week that, “China’s voracious appetite for imported meat is starting to wane, as domestic pork prices fall and consumer worries grow about the coronavirus lingering on food.”
Chinese Demand, Dry Weather Help Spur Crop Prices
Wall Street Journal writers Ryan Dezember and Kirk Maltais reported last week that, “Dry weather, China’s push to fatten its pigs and the lockdown-induced baking bonanza are lifting prices for U.S. row crops.”
Ag Lender Survey: Liquidity, Income and Leverage Are Top Concerns
A news release this week from the American Bankers Association (ABA) stated that, “As the farm economy continues to work through a prolonged downturn in the midst of an unparalleled, global economic dislocation, ag lenders remain focused on credit quality, according to the Fall 2020 Agricultural Lender Survey report produced jointly by the [ABA] and the Federal Agricultural Mortgage Corporation, more commonly known as Farmer Mac.”
Federal Reserve Ag Credit Surveys- 2020 Third Quarter Farm Economy Conditions
Last week, the Federal Reserve Banks of Chicago, Kansas City and Minneapolis released updates regarding farm income, farmland values and agricultural credit conditions from the third quarter of 2020.
China’s Grain Buying Is “Rocking the Global Market”
Late last week, Reuters writers Hallie Gu, Maximilian Heath, and Naveen Thukral reported that, “Chinese feed producers, pig farmers and traders are reshaping the global grain market as they scour the world for supplies amid a domestic shortfall that sent local corn prices to record highs and is expected to fuel global food inflation in 2021.”
Record 2020/2021 Grain Crop Expected in Brazil
Brazil is expected to produce a record grain crop in 2020/2021, despite the drought that affected planting in some regions. On Tuesday, the National Supply Company (Conab) projected 268.9 million tons of grain production, 4.6% more than 2019/2020.
China’s Corn Imports Estimated to Hit 22 Million Metric Tons, USDA- FAS
A report earlier this month from USDA’s Foreign Agricultural Service (FAS), “China’s Corn Imports Estimated to Hit 22 Million Metric Tons,” stated that, “The forecast for China’s corn imports for MY 2020/2021 is increased from 7 MMT to 22 MMT. The jump is attributed to depleted stocks to meet current demand. Continually rising domestic corn prices will also drive demand for additional imports in MY 20/21.”
USDA Agricultural Projections Show Increased Soybean Acres in 2021
On Friday, the USDA’s Office of the Chief Economist released selected tables prepared for the Department’s upcoming Agricultural Baseline Projections report.
CRS Report: Farm Bill Revenue Support, 2014-2020
A report last month from the Congressional Research Service (CRS), “U.S. Farm Policy: Revenue Support Program Outlays, 2014-2020,” stated that, “Provisions of Title I of the 2018 farm bill (Agriculture Improvement Act of 2018;P.L. 115-334) authorize a set of revenue support programs for major program crops for crop years 2019-2023 as part of the so-called farm safety net. This includes three principal revenue support programs— Marketing Assistance Loan (MAL), Agricultural Risk Coverage (ARC), and Price Loss Coverage (PLC).”
German Pork “Effectively Trapped in Europe” Due to African Swine Fever, as China Rebuilds Herds
Late last week, Bloomberg News reported that, “China is flying in record numbers of pigs to improve genetics and boost productivity while rapidly rebuilding the nation’s hog population after it was decimated by African swine fever.”