Cash cattle expected $1 higher
Choice boxes over $191
Cash hogs called steady to $1 higher
Good cook out weather as we head toward Memorial Day a prime BBQ holiday

10:08 update

Dow up 75 after positive housing starts at 717,000 or +2.6% and industrial production 1.1% higher
DAX off .2% on lingering Greek political crisis
China buys 900,000 tons of corn, Along with a 480,000 switch from unknown category
S Plains dryness reducing wheat yield potential
China raises soybean import forecast by 3 MT to 58 MT

Financial
Dow wobbles and may open higher but Greek tragedy persists
Interest rates continue to rise in junk Spanish and Portuguese bonds
S&P 1330 below support at 1340 and 1300 is next
Housing starts expected to rise to 690,000 for April
Industrial Production expected up .7%
Another Greek election next week but no majority possible in fractured political environment
Fed minutes today at 1 CDT
DAX up .2%
Crude falls further to $92.69 off $1.29 on poor demand
Gold down $5 at $1540
Dollar steady but near high at 81.78
Nikkei down 1.1% and Hong Kong 3% lower

Livestock
Cash cattle offered at $122-123 in the south and $125 up north
Boxed beef $.58 higher on choice and $1.58 select
Weekend features star cook out cuts select grade Porterhouse at $6.99, T-Bone $6.49 along with Chicken led quarters $.58 and assorted Pork Chops $1.58
Cattle coming off winter pasture are running out
Hogs over 20 day moving average line
Pork cutout up $.28 with loins $.94 higher and hams steady
Slaughter up 8000 in cattle and down 10,000 hogs

Grain and soybeans
Beans resume correctional course to downside
China corn and soybean export sales?
Kansas State sees 2-2.5 million more bean plantings
Illinois, Iowa and Indiana farmland up 19% in value in 1Q
Weather is fine
Hot June and July could trim yields but who knows
Rain in the Ukraine possible and needed after winter kill losses of about 33% and that also applies to Kazakhstan

“Because ethanol is displacing ten percent of the nation’s liquid transportation fuels today, it’s sold coast to coast and border to border, it’s having a huge impact on the price of crude oil,” said Renewable Fuels Association President and CEO Bob Dinneen. “And those combined effects add up to $1.09 a gallon.”

Co-author of the report, Iowa State University Professor Dermot Hayes explains ethanol has effectively increased refining capacity in the U.S. and that is a key way it impacts overall prices.

“We used to have big spikes in gasoline prices when the refining industry approached capacity, and those spikes would dominate the effect. We haven’t seen big spikes in gasoline prices due to refining capacity because we found a new way to produce essentially gasoline and we’ve added ten percent to our refining capacity.”

So based on Hayes numbers, what kind of dollars does that save the average household? RFA’s Dinneen says, “You’re saving $1,200 a year as a consequence of ethanol being added to gasoline. Since 2000 ethanol has helped save $39.8 billion annually in excess gasoline costs, so roughly $340 per household per year. Those are startling numbers.”

Since the study is based on just 10% ethanol in the nation’s gasoline supply, Dinneen says increasing the blend to 15 percent ethanol can only result in more savings. He thinks the economics of ethanol will help drive E15 into the marketplace this summer.

According to the update, regular grade gasoline prices averaged $3.52 per gallon in 2011, but would have been closer to $4.60 per gallon without the inclusion of more than 13 billion gallons of lower-priced ethanol. The overall impact is regionalized with a range from $0.73 per gallon in the Gulf Coast to $1.69 per gallon in the Midwest.

The original purpose of USDA was to foster research to increase food production.  Vilsack said the agency has been very successful at accomplishing that mission, “In my lifetime, corn production has increased 300% and soybean production 200%.” He said this kind of productivity has not only allowed American agriculture to feed the world but has now created a new bio-based economy.

American Farm Bureau Deputy Executive Director of Public Policy and former USDA senior staff member, Dale Moore, says this new bio-based sector represents the mission of USDA for the next 150 years, “It’s not just about the gasoline or the fuel that we put in our cars and trucks. It’s also about wind energy. It’s about biomass conversion, so that we’re making full utilization of the various crops and commodities that we’re raising to improve the economy.”

Praise for the Department poured in from all sectors of agriculture. National Corn Growers Association President Garry Niemeyer, “We have evolved from a time when corn planting used mule-drawn plows to an era of technically sophisticated tractors, multi-row planters, and GPS systems.  Over the past 150 years, the USDA has helped advance American agriculture, spur economic growth, conserve natural resources, and build stronger communities.” Steve Wellman, President of the American Soybean Association, said, “USDA has worked alongside soybean farmers for decades in the best interest of agriculture, developing international markets , fostering rural development, encouraging conservation, alleviating hunger, improving nutrition, and enhancing food safety.”

Senator Debbie Stabenow, Chairwoman of the Senate Committee on Agriculture, used the occasion of the USDA anniversary to call on Senate leadership to bring a new Farm Bill to the Senate floor, “It is critical that we pass the Farm Bill before the current bill expires in September. We passed a very strong bill out of Committee, with real reforms that cut the deficit by $23 billion – and we did it in a bipartisan way.”

Villsack noted that one of the challenges his agency faces in the next 150 years is bringing a new generation of farmers onto the land.  During his remarks, he urged Congress to make changes in the tax laws to make it easier for farms to be transferred to the next generation.

History of USDA

The bill streamlines conservation programs and helps prevent fraud and abuse in nutrition programs. Also, the risk management, conservation, research, trade promotion and nutrition programs in the legislation impacts nearly every American. Many of these programs will expire at the end of the year if no action is taken to reauthorize the farm bill.

Those Senators signing the letter are: John Barrasso, Max Baucus, Michael Bennet, Richard Blumenthal, Roy Blunt, Scott Brown, Sherrod Brown, Maria Cantwell, Bob Casey, Dan Coats, Kent Conrad, Chris Coons, Mike Crapo, Mike Enzi, Al Franken, Kristen Gillibrand, Chuck Grassley, Kay Hagan, Tom Harkin, John Hoeven, Kay Bailey Hutchison, Daniel Inouye, Mike Johanns, Tim Johnson, John Kerry, Mark Kirk, Amy Klobuchar, Herb Kohl, Pat Leahy, Dick Lugar, Claire McCaskill, Jeff Merkley, Jerry Moran, Ben Nelson, Bill Nelson, Jim Risch, Bernie Sanders, Jeanne Shaheen, Olympia Snowe, Jon Tester, John Thune, Mark Udall, Tom Udall, and Ron Wyden.

Source: NAFB News Service

The House Agriculture Committee continues key farm bill hearings this week, and as it does a dozen farm groups have sent a letter to House Ag Chairman Frank Lucas and Ranking Member Collin Peterson on the importance of crop insurance. In their letter the groups state – Federal crop insurance provides an effective risk management tool to farmers and ranchers when they are facing losses beyond their control. They note – it reduces taxpayer risk exposure; it makes hedging possible to help mitigate market volatility; and it provides lenders with greater certainty that loans made to producers will be repaid.

One of the groups that signed the letter was the National Corn Growers Association. NCGA has previously stated that crop insurance remains the number one priority in the new farm bill as well as a market oriented, risk management tool to cover multi-year price declines.

Other groups signing the letter were: American Farm Bureau Federation; American Soybean Association; American Sugarbeet Growers Association; National Association of Wheat Growers; National Barley Growers Association; National Cotton Council; National Farmers Union; National Sorghum Producers; National Sunflower Association; U.S. Canola Association; and the USA Dry Pea & Lentil Council.

Source: NAFB News Service

Farm Credit’s first quarter performance was directly related to the strong agricultural economy and robust farm land values. “While farmers are able to pay down debt, we saw an increase in new loan activity, particularly on mortgage loans,” said Bill Johnson, president and chief executive officer.  “For the first quarter, loan closings were up more than 20 percent for farm land purchases and almost 50 percent for consumer mortgages.”

Credit quality of the association’s portfolio was also stable. Adversely classified loans decreased to 3.8 percent of the loan portfolio compared to 3.9 percent at December 31, 2011.

The association’s commitment to rural America remained strong and Johnson sited conversion activity as one example of that commitment. “Since the beginning of the year, Farm Credit has converted – or refinanced – nearly 15,000 customer loans representing more than $ 2.2 billion in volume with a customer interest expense savings of $ 57 million over a three year period. Our fee for conversions is minimal with very little paperwork involved and our customers are often surprised that we can lower their interest rate even on fixed rate loans.”

Another way the association provided value to rural communities was through the availability of long-term fixed rate financing for farms. “Almost 50 percent of our customers have fixed rate loans of 10 years or longer. In today’s volatile farm environment, one way to ensure that the cost of farmer’s financing remains consistent is through fixed rates.”

Johnson added that the association’s strategic plan calls for continued growth. “We’ll do that by making certain that our products and programs fit our customers’ needs and adapting to the changing demands of a new agriculture marketplace.  It’s all about providing value to those who live and work in rural America.”

To see the complete results, go to www.e-farmcredit.com, select News, then Quarterly Report.

About Farm Credit Mid-America

Farm Credit Mid-America is an $ 18.3 billion financial services cooperative serving more than 95,000 farmers, agribusinesses and rural residents in Indiana, Ohio, Kentucky and Tennessee. The association provides loans for all farm and rural living purposes including real estate, operating equipment and housing and related services such as crop insurance, and vehicle, equipment and building leases. For more information about Farm Credit, call 1-800-444-FARM or visit them on the web at www.e-farmcredit.com.

Source: Farm Credit Mid-America

Livestock
Cattle creep up on cash with June at a $4 discount
Memorial Day meat pricing firms values
Boxed beef was, however, just steady at noon
Outside markets give meats the he be gibes
June hogs are at the highest point since 4/27
Cash call steady to higher
Watch pork cutout Wednesday morning

Grain and soybeans
Short covering closing near their highs in all
Little export activity
South Korea routinely buys 56,000 tons of corn
Corn plantings 87% done and beans 46% with spring wheat 94% complete
Kansas wheat 52% good to excellent down from 60% last week and watch western plains dryness
Watch for stories of woe out of the Ukraine
European rapeseed production at a six year low
Chinese corn plantings seen up 2%
On weakness December support is at $5
Remember short covering is the weakest form of buying
Wheat harvest beginning means hedge pressure

10:58  update

Greek possible exit from EU offsets better German 4Q GDP

US on fiscal cliff?  I hear that kind of talk from credible sources

Bargain hunters rally palm oil which is sensitive to European woes

India grain stock as of 5-1 at 38 MT versus a 4 MT average

Moderate short covering in grains and soybeans

10:29 update

Dow up 18
JP Morgan comes back 2.1%
Builder’s sentiment improves
Short covering in grains and oilseeds
Wheat harvest beginning and so shall hedge pressure
Beef and pork benefit from Memorial Day pricing

Financial
German GDP up.5% in 4Q, versus .1% expected and -2% in 3Q
Europe stagnates for the day
S&P 500 support 1340 and then 1300
Dow closes below 12,700 with 12,500 next
Pre open Dow trade was up 75 points—Dow beats quick retreat down 10 at 8:48
DAX up just.2%
Crude little changed at $94.73
Dollar index pushes higher up 22 at 80.83 with years high at 81.78
Gold static at $1560
Euro zone worries just distracted by German GDP

Livestock
Retailers begin pricing Memorial Day features and choice beef raises $1.93 and select up $2.05
Last weekend clearance helped by weather and next two weeks look ducky
COF Friday
Cattle technical action positive Monday
Cattle slaughter 127,000 up 8000 v last week and hogs down 10,000
Pork cutout $1.44 better with loins up $2.69 and hams + $.69
Some see Chinese hog prices falling 20%

Grain and soybeans
Corn 87% planted as expected and beans 46% also on target both about one month ahead of schedule
Spring wheat 94%
Winter wheat condition 60% good-excellent down from 63%
Brazilian bean harvest done
Brazilian corn estimate 64 MT up from 62 MT
December corn support at $5.00
Watch western wheat area for dryness
22 hour trade begins 5-21 amidst some Ag industry opposition
Export sales Thursday, June crop estimate (Not a survey and none until August) on 6-12 with the quarterly stocks on 6-29
Short covering rallies over night

For agriculture, the agreement with South America’s third-largest economy achieves two key trade objectives for the United States: it immediately provides vastly improved access to Colombia’s market, and it levels the playing field with respect to third-country competitors. Under the agreement, American farmers and ranchers can expect to see their exports grow by more than 370-million dollars, or more than one-third of the current total.

Colombia will immediately eliminate duties on wheat, barley, soybeans, soybean meal and flour, high-quality beef, bacon, almost all fruit and vegetable products, wheat, peanuts, whey, cotton, and the vast majority of processed products. The Colombia TPA also provides duty free tariff rate quotas on standard beef, chicken leg quarters, dairy products, corn, sorghum, animal feeds, rice, and soybean oil.

Steve Wellman, President of the American Soybean Association, and a soybean farmer from Syracuse, Nebraska, says – the pact expands a valuable and growing export market for American soybeans, meal, oil and products that require soy inputs like dairy, meat and poultry. The agreement also helps us regain lost market share in Central and South America’s third largest economy. Last year, the U.S. exported more than 182-million dollars in soybeans and soybean products to Colombia.

China, Japan and South Korea Considering FTA
After a decade of discussions, China, Japan and South Korea have agreed to soon launch negotiations on a three-way free trade pact. Officials say the Japan-China-Korea FTA will be – an extremely important piece of economic cooperation. According to the official Xinhua news agency, leaders also – agreed to a three-way investment treaty – one stepping stone to the bigger and much more contentious goal of a free trade deal.

Negotiations are expected to be difficult. Standing in the way are tensions on the Korean peninsula, political distrust, trade barriers and diverging investment policies. The three nations are major traders, and together accounted for 19.6 percent of the world’s economy and 18.5 percent of its exports in 2010.

Source: NAFB News service

The AgriVision award is open to any current Indiana resident and all sectors of agriculture – from bioenergy to livestock to trade.  It was specifically created to honor an individual who has reshaped Indiana’s agriculture through innovative or technological advances or through new business methods.

“This award allows us to demonstrate how much we appreciate our leaders in agriculture who demonstrate vision and the perseverance to create new and exciting opportunities,” said Lt. Governor Skillman, Secretary of Agriculture. “This type of leadership deserves to be recognized because only that level of commitment will continue to grow agriculture in Indiana and ensure our state’s position on a global level.”

Click here for an AgriVision application which is due July 1, 2012.

Previous AgriVision Award winners:

2011 - Dr. Vic Lechtenberg, vice provost for engagement and former dean of agriculture of Purdue University

2010 - JoAnn Brouillette, managing partner and president of Demeter LP

2009 – Brian Reichart, president and chief executive officer of Red Gold, John Swisher, founder, chief executive officer and chairman of JBS United

2008 - Charles “Shorty” Whittington, president and chief executive officer of Grammer Industries, Inc.

2007 - Lawrence “Sonny” Beck, president of Beck’s Superior Hybrids

The webinar is in response to recent changes made by the ASTM D02 committee creating changes to the ASTM D5798 Standard Specification for Ethanol Fuel Blends for Flexible-Fuel Automotive Spark-Ignition Engines. In other words, the “E85″ Specification. While several changes were made the most significant improvement is the allowance of a wider range of ethanol content, specifically 51 to 83% by volume. Some additional modifications were made that will improve the flexibility for fuel blenders while still ensuring optimal performance for drivers of flex-fuel vehicles. These, along with other changes were needed to allow both E85 sales to continue as well as to broaden the use of mid-level ethanol blends.

It is important to understand that neither the definition of E85 nor the capability to blend it have been altered by this update to D5798.

The aforementioned issues will be addressed as well as what these changes mean for E85, alternative fuels, government fleets, and mid-level ethanol blends. The webinar will also address many concerns and questions that have risen in light of how marketers across the country are adopting new practices based on this new specification. For those who would like to participate, you will need to register here: http://bit.ly/JUIG3D.

Source: Joanna Schroeder at Domesticfuel.com