A Weekly Update from the Red River Farm Network
Monday, May 20, 2019
Breaking News and Top Stories- The Red River Farm Network prides itself in providing timely and accurate information for the farmer and rancher. There was no shortage of news this past week. The U.S. dropped steel and aluminum tariffs for Canada and Mexico, followed by the end of trade retaliation against U.S. ag products. Japan ended its restrictions on American beef imports. The Trump Administration announced a trade-related assistance package will be announced with a matter of days. On the policy front, a budget agreement was secured between Minnesota Governor Tim Walz and legislative leaders just ahead of adjournment at midnight tonight. Obviously, the cold, wet weather is also top-of-mind with planting delays seen across the region and nationally. Learn more about these topics in this edition of FarmNetNews.
U.S. Lifts Section 232 Tariffs on Canada and Mexico – President Donald Trump has lifted the steel and aluminum tariffs on Mexico and Canada. “As you know, for years Canada has been charging us extremely high tariffs, as much as 285 percent or more for agricultural products, which is an absolute barrier to our farmers being able to do business with them.” Trump said hopefully Congress will approve the U.S. Mexico Canada Agreement quickly. “And then, the great farmers, manufacturers and steel plants will make our economy even more successful than it already is, if that’s possible, which it is possible.”
A Waiting Game for Congress – Minnesota Senator Tina Smith says it’s a waiting game for Congress right now on the U.S. Mexico Canada Agreement. “I want to be in a place where I can sign this agreement. I still have questions about some elements of the deal like enforcement of some of the labor and environment provisions.” Smith says it is important tariffs get resolved.
The Fate of USMCA Rests in the House – Senate Majority Whip and South Dakota Senator John Thune tells the Red River Farm Network it’s likely the U.S. Mexico Canada Agreement would get enough votes to pass in the Upper Chamber. “The bigger issue right now is House Speaker Nancy Pelosi and whether or not House leadership wants to give the president a win on a big issue like this.”
U.S. Beef Gains Access to Japan – The U.S. Department of Agriculture says United States and Japan have agreed on new terms and conditions eliminating Japan’s restrictions on U.S. beef exports. The terms take effect immediately and allow U.S. products from all cattle, regardless of age, to enter Japan for the first time since 2003. More on the new terms and conditions will be released Monday. The expanded access could increase U.S. beef and beef product exports to Japan by up to $200 million each year. Read the full USDA announcement.
Stockmen’s Association Encouraged by Access to Japan – Japan is the leading market for U.S. beef, even though restrictions have been in place since 2003 on U.S. beef exports to the country. On Friday, those restrictions were lifted as the two countries agreed on new terms for beef. North Dakota Stockmen’s Association Executive Vice President Julie Ellingson says the Japanese market is now open to beef products from cattle of all ages. “That’s substantial for a number of reasons,” says Ellingson. “One, it finally recognizes the safety and wholesomeness of U.S. beef. It also removes a non science-based trade barrier that provides economic incentives and opportunities for U.S. beef producers.” The Stockmen’s Association is also encouraged by recent discussions between the U.S. and Japan about the possibility of a bilateral trade agreement. Ellingson is hopeful the 38.5 percent tariff currently on U.S. beef can be reduced or even eliminated. Hear more of the conversation.
Wheat Growers Eager for an Agreement with Japan – A trade agreement with Japan would be beneficial for many in agriculture, including wheat growers. U.S. Wheat Associates Director of Policy Ben Conner says growers are eager to know when an agreement will be made. “When is very important and how is too,” says Conner. “There are steel tariffs on Japan right now. I think the tariff approach, particularly on the steel and aluminum side, hasn’t helped our trade position. We’re hoping to see those go away. We hope that will help us in a trade agreement with Japan.”
No New Negotiations Scheduled Between U.S. and China – China is apparently not in a hurry to return to the bargaining table with the United States. Chinese media is reporting President Xi Jinping may suspend his planned meeting with President Donald Trump next month if the U.S. was not “prepared to be realistic” in the trade talks.
Funding the New USDA Trade Assistance Package – North Dakota Senator John Hoeven is working with the USDA and the White House on the new trade aid. He confirms funding for the $15 billion range of aid would come through the Commodity Credit Corporation, funded by tariffs. “We are working on the details right now and I think it will be a combination of things,” says Hoeven. “We’ve talked about a Market Facilitation Program payments, also direct purchases and trade assistance.” The new aid could be better for other crops. “I’ve talked to Agriculture Secretary Sonny Perdue about basis, a big factor in North Dakota, about crops like canola that didn’t get assistance, but are directly impacted (by the trade war),” says Hoeven. “That’s why we’re looking at a combination of things to help with crops impacted.”
Perdue: Few Trade Mitigation Details Available Right Now – The U.S. Department of Agriculture is in the middle of developing a trade assistance program for farmers. According to Agriculture Secretary Sonny Perdue, there are very few details available at the moment. “We are assuming it will contain direct payments for commodities,” says Perdue. “Certainly the President’s concept of buying commodities for humanitarian purposes may also be part of that.” The new trade package is expected to cost between $15 and 20 billion, which is the general calculation of damages to U.S. farmers from the trade dispute with China. “We’ve asked our economist at USDA to be very precise when calculating what we believe to be legally defensible trade damages done to our U.S. producers.” Perdue remains hopeful for the U.S. to reach a trade agreement with China. Listen to more.
More Details Revealed on USDA Trade Aid – Trade aid details are still being finalized. On Tuesday, USDA officials hinted at what could be coming in aid for farmers. USDA Under Secretary for Trade and Foreign Agricultural Affairs Ted McKinney told reporters the new aid package would be diverse. “Some pieces may come and go, ebb and flow. Some of the programs seen in the last round of payments are being considered and other things, too,” he said. “We want to be robust and we want to make sure farmers get the message while trade is preferred, the administration has their backs given the strife they’ve been through.” McKinney said USDA doesn’t want to do anything to harm potential commercial sales. Under Secretary of Farm Production and Conservation Bill Northey said it will also be important to not influence a farmer’s planting decision.
Corn Growers Calling for Adequate Trade Assistance – The National Corn Growers Association, along with state organizations, is calling on the Trump Administration to provide adequate trade assistance. According to the NCGA, increasing tariffs on Chinese goods, coupled with retaliatory tariffs, bring continued uncertainty to corn markets.”The payment rate for corn in the previous Market Facilitation program was just one penny per bushel,” says Minnesota Corn Growers Association Past President Kirby Hettver. “We’re asking for a more fair compensation because the corn market has been influenced certainly more than a penny.” In the grand scheme of things, Hettver says trade tensions with China impact much more than just corn for grain.” It’s also ethanol and dried distillers grains.”
What USDA Learned from the 2018 MFP Payments – In an interview with the Red River Farm Network, Under Secretary for Farm Production and Conservation Bill Northey said it was hard to deliver the 2018 Market Facilitation Program in a fair way. “Some producers still had old crop on hand. They lost price on that or needed to move something for cash flow reasons so they took more or less of a hit,” explained Northey. “It’s hard to be fair and equitable between all producers, but certainly speed and transparency matter. People need to understand what the payment was. They weren’t always going to agree it was the right amount, but they could understand the rates and we could deliver it fast.” Northey said there will likely always an argument over rates. “We look at all of the commodities and all of them could have ended up with more. We’ve also seen the soybean and corn markets soften from last year.” Listen to the story.
Trade Uncertainty Remains – National Council of Farmer Cooperatives President Chuck Conner says the administration thought much of the trade uncertainty could be wrapped up by now, allowing farmers to market their 2019 crop without much interference of trade policies.”That looks like that won’t be the case,” says Conner. “We don’t have a deal with China and the U.S. Mexico Canada Agreement isn’t happening anytime soon. The administration is starting to look at the impact of trade on farmers in 2019.” Conner says there is still hope the Section 232 tariffs can be resolved. President Trump will be meeting Chinese President Xi Jinping next month to resume trade discussions.
Canola Minute – Trade remains top of mind for the canola industry. Hear more from Executive Director Barry Coleman in this week’s Canola Minute, made possible by the Northern Canola Growers Association.
More Transparency Promised in Wetlands Determinations – USDA’s Natural Resources Conservation Service is meeting with stakeholders and working through the public comments on the interim wetlands rule. Conservation compliance and water management regulations have caused heartburn in the past, particularly in the Prairie Pothole Region. NRCS Chair Matt Lohr told the Red River Farm Network changes have been made. As an example, there will be more personal service when a wetlands determination is made. “If it is determined to be a wetland, our staff will reach out personally to the farmer and talk to them; it’s not just a letter.” Lohr says the wetlands determination process will be more transparent. The appeal process is also being adjusted. “In the past, our agency maybe was a little overzealous in appealing again, again and again.” With the new process, NRCS will allow only two appeals.
Peterson Working on a Way to Address CRP Challenge – Sign-up for the USDA’s continuous Conservation Reserve Program will be June 3 with a general signup in December. House Agriculture Committee Chairman Collin Peterson isn’t happy about it. He let Farm Service Agency Administrator Richard Fordyce know during Wednesday’s House Agriculture Subcommittee hearing on farm bill conservation programs. At issue is opening up continuous sign-up under existing regulations. Peterson told Fordyce farmers will try to enroll for the continuous, because of higher rental rates. In turn, reducing available acres for the general sign up. Peterson tells the Red River Farm Network he’s been talking with USDA since the hearing. “Their general counsel has since been on the phone with my lawyers. I also talked to Senator Hoeven. Maybe we’ll put a provision in the disaster bill we’re working on to stop them from doing this,” says Peterson. “Some way or another, I’ll make it work out.”
Trump Donates Paycheck for Farmer Outreach – President Donald Trump is donating a portion of his salary to benefit farmers. The $100,000 donation is going to USDA for outreach programs for farmers. Trump has made similar donations to eight other government entities during his presidency.
TransFARMation: The Ostrich Syndrome – Farmers have a lot coming at them right now, including low commodity prices, uncertain trade policies and weather delays during the rush of a busy planting season. None of these issues are things that farmers can control. When overwhelmed, it can be easy to stick our head in the sand and not deal with these problems. Ted Matthews, who is the rural health counselor for the State of Minnesota, says it is important to concentrate on what you can control. “Know what you have in front of you and what you have control over and focus on those things. Getting those things done will be a positive thing.” Matthews takes calls from farmers every day, helping them maneuver through difficult times. In this edition of TransFARMation, Matthews offers ideas for farmers who are struggling. Listen here.
Crop Watch – The planters are rolling near Fisher, Minnesota. “It was a little slow getting going, but conditions are about right,” says area farmer Steve Williams. “The biggest holdup right now is we’re waiting for fertilizer to be spread on sugarbeet ground.” At Thief River Falls, CHS Ag Services sales agronomist Josh Knaack says wheat seeding is coming to a close. “Soybeans, corn and canola are going in the ground and soon to be sunflowers.” While soil temperatures are still a bit cool, Grygla farmer Steve Sparby says the dry conditions have helped. Over the past week, Crookston farmer Kevin Capristran says quite a bit of wheat has gone in the ground. “We should also be able to put in sugarbeets fairly quick as well.” Elliot Solheim, who farms at Greenview, is getting corn in the ground. “There are very few wet spots to go around and try to follow up right behind the planter with a pre-emerge.” Listen to the full Crop Watch segment.
Dry Weather Aids in Walsh County Planting Progress – Farmers in northeast North Dakota used the stretch of dry weather to get a number of crops in the ground. Based at Park River, Midwest Consulting owner and agronomist Dave Svobodny says farmers are nearly done seeding wheat and planting sugarbeets. “A moderate amount of corn and soybeans have gone in since soil temperatures warmed up. By the calendar they’re behind, but farmers are doing well for the number of field days.” A hurry to get the crop in the ground is increasing the demand for fertilizer. “Dry urea and anhydrous are both short in places. While it was expected, it hit a lot faster than most anticipated.” Svobodny says most drills and planters have kept rolling and is working with farmers on a topdress option.
Wet Conditions Keep SD Farmers Out of Fields – Wet conditions are keeping South Dakota farmers from making much planting progress. Astoria, South Dakota farmer David Iverson says there are some challenges. “We had a lot of rain and snow earlier, into May,” explains Iverson. “One afternoon I went to the field for a few hours to make sure everything is working. We’re waiting for drier weather.” Iverson is planting corn and soybeans, a similar rotation to previous years.
Cooperstown, ND Crop Going in the Ground – Farmers are experiencing drier conditions, aiding in planting progress. In the Cooperstown, North Dakota area, Ag Advantage Consulting owner Jonathan Erickson says mainly wheat and corn have gone in the ground. “These are the wettest conditions I’ve seen in year, so it’s been a battle. Fertilizer spreaders are going full bore trying to get the ground prepped,” says Erickson. “I finished planting wheat and am just starting soybeans.” Erickson says acreage is a mixed bag due to the delayed planting. Most farmers are staying with their original plans. “It’s mostly on a per-field basis. With the markets lately nobody knows what to plant, so a lot of people are sticking with what they know.”
Dry Bean Scene – Farmers are making planting progress. Northarvest Bean Growers Association Past President Tom Kennelly, who farms at Grafton, ND, is putting dry beans in the ground. Get the details in the Dry Bean Scene, made possible by the Northarvest Bean Growers Association.
Pioneer Agronomy Update at Lisbon, ND – This week, the Red River Farm Network team traveled to Timber Coulee Seed at Lisbon, North Dakota for the Pioneer Agronomy Update. “With a late start, farmers are focused on the getting the crop in the ground. I am getting some questions on maturity,” says Pioneer field representative JJ Jaehning. ” The general rule of thumb is to stay with the maturity for your region until about May 21 to 25. In south east North Dakota, 95 to 97 day hybrids are common. We recommend going three to five maturity points below that mark if a switch is needed.” Watch the Facebook video here.
WestBred Wheat Report – It won’t be long until this year’s wheat crop reaches the first critical growth stage. In this week’s WestBred Wheat Report, Technical Product Manager Grant Mehring talks about tillering. Listen to the update.
Fertilizer Supplies Being Spread Thin – As more and more tractor tires start turning in the fields, fertilizer supplies are being spread thin. According to Dahlen Farmers Elevator general manager Mike Kratchovil, the supplies are there for now. The hiccup comes with delivery to the distributors. “Urea is really tight, so the nitrogen are the issue,” says Kratchovil. In some instances, urea is traveling 500-plus miles one way from Canada to northern parts of the state. Kratchovil says it’s tough for farmers to sit on fit field conditions and wait for fertilizer. “While I don’t want to chase my farmers away, it doesn’t hurt to check somewhere else. We just have to get what we can done and hope it turns around.” Listen to more.
Weed Management Strategies: Episode Nine – The Enlist E3Technology is now commercially available for growers. Peterson Farms Seed agronomist Adam Spelhaug says there is interest in the technology. “It’s another option that fits some of the weed management strategies our growers need. It’s an easy, forgiving and versatile package,” says Spelhaug. “There are many options on how to spray and tackle hard to target weeds.” Presented by the North Dakota Soybean Council, Weed Management Strategies is a ten-part series exploring best management practices and the tools to help farmers take care of herbicide resistant weeds. Listen to the podcast here, on iTunes or download a podcast app on Google Play.
Private Analyst Adjusts Acreage Forecast – IEG Vantage, which formerly was known as Informa Economics, is estimating corn acreage at 90.6 million acres. That compares to the most recent USDA estimate of 92.8 million acres. For soybeans, IEG Vantage forecasts acreage at 86.4 million. USDA has soybean acreage at 84.6 million acres. The Agriculture Department will update numbers in June.
SD Corn Comments – South Dakota corn exports to foreign countries total $490 million, including $190 million worth of ethanol and $162 million worth of distillers grains. Hear more in this week’s Corn Comments, a weekly feature from the South Dakota Corn Utilization Council.
Fewer Corn Acres Could Have a Market Impact – Planting delays are evident across the Midwest, and the markets are starting to factor them in. With the possibility of fewer planted corn acres, the grain trade has all eye on the June USDA crop report. “I’ve heard as much as four to eight million acres less of corn that is going to get planted. That would drastically change the tone of this market,” says Van Ahn and Company COO Kristi Van Ahn. “While those acres won’t officially be recognized until the June report, it will slowly be built into the market.”
Rural Perspectives: Episode 14 – The Red River Farm Network has teamed up with AgCountry Farm Credit Services in a podcast series called Rural Perspectives. Farmers in the Northern Plains continue to face a late spring, and prevented planting is becoming more of a reality. In episode 14 of Rural Perspectives, AgCountry Farm Credit Services Senior Insurance Specialist Jason Rohr discusses the PP option and more. Take a listen.
What’s Hot, What’s Not in the Markets – In this week’s edition of ‘What’s Hot, What’s Not in the Markets,’ Advance Trading risk management advisor Tommy Grisafi sees opportunity in corn. Grisafi, who is based at Portland, North Dakota, also highlights the current volatility in the marketplace.
Prevent Plant is Becoming More of a Reality – Corn planting in Minnesota and South Dakota is lagging well behind last year’s pace and the USDA five-year average. Based at Britton, South Dakota, DuWayne Bosse of Bolt Marketing says prevent plant is becoming more of a reality. “Planters are rolling now, and farmers will get in what they can, but anymore rain and there’s no doubt we’ll be higher on prevent plant acres.” The Trump Administration has said it will provide a $15 billion assistance package to U.S. farmers, which could provide some incentive for farmers to plant soybeans this year. Bosse says that trade aid does change the market. “That actually gets me more bearish to the soybean market. The November futures would definitely would create some profitable positions.”
Final Corn Planting Dates Start in Late May – With many farmers and market analysts talking about prevented planting as an option this spring, final planting dates for corn become important. The final corn planting date for crop insurance in Illinois, Indiana, Michigan and Ohio is June 5, while the southern two-thirds of Minnesota, Iowa, the southeastern corner of North Dakota and the southeastern corner of South Dakota is May 31. Northern Minnesota, the remainder of North and South Dakota and Nebraska have a final corn planting date of May 25.
What Do Farmers Need to Know About Prevent Plant? – As time goes on, and more rain falls, fewer acres may go in the ground. AgCountry Farm Credit Services Senior Insurance Specialist Kirsten Huschka says prevent plant is an option as farmers face final planting dates. “It’s important to talk about whether farmers should plant late with reduced coverage or stop planting and figure out if they’re eligible for a prevent plant payment.” Huschka is fielding questions about prevent plant eligibility, specially related to corn, because it holds the highest payment. “There might not be as many acres available to pay out as corn because farmers are planting more corn this year than the last four years.” Hear more in this interview.
The Sugarbeet Report – Sugarbeet farmers in the Red River Valley are making substantial planting progress. American Crystal Sugar Company general agronomist Tyler Grove has more in The Sugarbeet Report, made possible by SESVanderHave, Syngenta, Premium Ag Solutions, H&S Manufacturing and Corteva Agriscience. Listen here.
MFBF Update – It’s a busy time of year in St. Paul as the legislative session wraps up. Associate Director of Public Policy Josie Lonetti has this report from the legislature in the MFBF Update, made possible by the Minnesota Farm Bureau Federation.
Walz and Legislative Leaders Finalize Budget Agreement – At the 11th hour, Minnesota Governor Tim Walz and legislative leaders announced a budget deal. “Today we proved that divided government can work for the betterment of the people we serve,” said Walz late Sunday night. “As one of only two divided state governments in the country, we reached a bipartisan agreement on time for the first time in over a decade.” The two-year budget totals $48 billion and does not include a gas tax. The provider health care tax remains, but there is a small drop in the tax rate. Budget targets include $4.5 million for agriculture in fiscal year 2020-2021 and $3.9 million in FY 2022-2023. Conference committees will determine where those dollars will go and the policy areas that will be included in the budget bills. By statute, the session must adjourn by midnight tonight. A special one-day session to wrap up that work is expected to take place on Thursday.
Minnesota Beef Update – Minnesota State Cattlemen’s Association lobbyist Bruce Kleven says one issue right now involves a Minnesota Pollution Control Agency fee increase proposal. Listen to more in the Minnesota Beef Update, a production of the Minnesota Beef Council and the Minnesota State Cattlemen’s Association.
USDA Boosts Efforts to Prevent U.S. ASF Outbreak – The USDA says it will implement additional measures to help U.S. pork producers monitor for African swine fever. The Animal and Plant Health Inspection Service will be working with the swine industry on testing. The National Pork Producers Council is pleased with the USDA’s efforts for the surveillance plan. In addition to testing this plan requires work with states to identify and investigate incidents involving sick or dead feral swine, work with officials on a North American coordinated approach to ASF defense and increase dog teams with U.S. Customs and Border Protection. Currently, there are no reported cases of ASF in the United States.
MN Corn Matters – Farming can be a stressful business, and there are resources available for those involved. Learn more about Mental Health Awareness month from Upper Midwest Agricultural Safety and Health Center coordinator Diane Kampa. Corn Matters is a weekly update from Minnesota Corn Growers Association.
Lawsuits Filed Against Major Packers – Two class-action lawsuits have been filed in the U.S. District Court for the District of Minnesota against the largest beef packers in the country. A Florida live cattle futures trader, Michael Sevy, claims the packers have conspired to drive down prices since January of 2015. A similar lawsuit filed by R-CALF USA was voluntarily dismissed in an Illinois court and refiled in the Minnesota court.
Deere Reports Lower Outlook for the Year – Deere and Company earned $1.13 billion in the quarter ending April 28, down from $2.21 billion is the same period last year. Delayed planting and the U.S. China trade war are causing caution in the sector. The company reported a five percent jump in overall sales. Construction and forestry sales were up 11 percent to $2.99 billion. Agriculture and turf sales were up three percent to $7.28 billion.
Quarles Transitions to National Potato Council CEO – As of last Wednesday, National Potato Council’s former Vice President of Public Policy Kam Quarles is leading the organization as CEO. He’s replacing former Executive Vice President John Keeling, who is retiring June 30. The next few weeks are a time of transition. Quarles says trade is very much top-of-mind for potato growers and it’s important to get it right. “Getting the U.S. Mexico Canada Agreement ratified and an agreement with China will be important,” says Quarles. “We also lost benefits when the U.S. walked away from the Trans-Pacific Partnership Agreement. If the U.S. can put together a bilateral trade agreement with Japan or other key export markets, we very much want to be part of that conversation.”
Princess Kay Finalists Selected – The ten finalists for Minnesota’s Princess Kay of the Milky Way competition have been announced. That list includes Kayla Biel of Fillmore County, Elizabeth Golombiecki of Stevens County, Donna Honer of Stearns County, Grace Jeurissen of McLeod County, Elizabeth Krienke of McLeod County, Amy Kyllo of Olmsted County, Lexie Lange of Martin County, Rachel Paskewitz of Todd County, AnnaMarie Sachs of Olmsted County and Brittney Tiede of Le Sueur County.
Last Week’s Trivia- The White House is located at 1600 Pennsylvania Avenue. Brian Rydlund of CHS Hedging was the first to respond with the correct answer and is our weekly trivia winner. Colgate farmer Jason Mewes, Adam Kuznia of AGSERV, Norm Groot of Monterey County Farm Bureau and Cathy Riley of Minnesota Soybean are runners-up. The ‘first 20’ rounds out with Randy Knudsvig of First State Bank, Gary Sloan of BMO Harris Bank, Cody Dedow of Bader Rutter, Gary dairy farmer Alan Grunhovd, Todd Good of AgCountry Farm Credit Services, Dennis Duvall of Dakota Environmental, Renee Scheurer of Betaseed, Angie Skochdopole of broadhead, Dennis Sabel of Minnesota Farm Bureau, Jon Farris of BankWest, Bob Brunker of J.L. Farmakis, Parnell Thorson of Agri Finance Group, California EPA Deputy Secretary of Agriculture Val Dolcini, John Zietz of Cargill and Phil Murphy of North Dakota Soybean Growers Association.
This Week’s Trivia- What stunt performer is known for jumping his motorcycle at Snake River Canyon, Grand Canyon and Ceasars Palace? Send your answer to email@example.com.
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FarmNetNews is a production of the Red River Farm Network. RRFN is based in Grand Forks, North Dakota and provides news to farmers and ranchers across Minnesota, North Dakota and South Dakota.