Grains

The House voted late Thursday to reopen the U.S. Department of Agriculture. The bill passed 243-183, 10 of those votes were Republicans. The Republican-controlled Senate, however, has shown no signs of taking up any of the three funding bills passed by the House, meaning the partial government shutdown impacting nine cabinet departments will likely continue into its fourth week. USDA has been running a skeleton crew since the Friday following the Dec. 21 shutdown when their funding reserves ran out. Still, the Supplemental Nutrition Assistance Program, commonly known as SNAP or food stamps, will continue providing food stamps to millions of Americans through February. “At the direction of @POTUS, we've announced a plan to fully fund SNAP benefits for February, despite Congress' inability to send the President an appropriations bill that secures our borders. We're doing right and feeding everyone” Agriculture Secretary Sonny Perdue tweeted. Amid wild speculation by media and politicians alike about the impact of the shutdown, Perdue took to Twitter to set the record straight about essential functions in his department that are still taking place. “Want to calm some fears because of somewhat sensational reporting on the shutdown. @USDAFoodSafety inspectors are still at work, checking meat, poultry & processed eggs. Inspectors also screening for pests at export & import points, incl between Hawaii & Puerto Rico and mainland,” he Tweeted on Friday. He also acknowledged trade fears that the data from the January crop production report previously scheduled to be released today would be lost. “There have been some stories written about fears of lost agricultural research during the shutdown. To be clear: at @USDA_ARS we have over 1,100 employees on the case to protect research property & data where significant damage could result if unattended for any period of time,” he tweeted.

Farmers are proving they can do more with less as national corn and soybean yield averages climb year after year. Genetics, management and Mother Nature all undoubtedly play their roles, and some states have bigger wins to tout than others. U.S. corn and soybean yield averages from 2013 to 2018 are well above trend lines, by 8.2 bu. per acre and 3.7 bu. per acre respectively, according to the University of Illinois farmdoc daily. Soybeans boast above trendline yields in all states the crop is grown. “This six-year run has been remarkable in length,” wrote Gary Schnitkey with farmdoc daily. “A combination of good growing conditions, continuing increases in genetic potential of soybean varieties and changes in farming practices are likely to contribute to high yields.” While all states do show above-trendline yields, they aren’t equal. Some geographical patterns raise more questions than answers, Schnitkey said, such as South Dakota’s exceptional yields when compared to surrounding states. More research will need to be conducted to find an answer. Corn yields varied by more than 40 bu. per acre geographically. Seven states showed actual yields that averaged a positive of at least 20 bu. per acre over trendlines, while five showed negative yields—up to 18 bu. per acre. “Since 1995, actual corn yields in the U.S. usually are above trend,” Schnitkey said. “[However] when yields are below trend the actual yield can be well below trend, as occurred in 2012 when the actual yield of 123.1 bu. per acre was 35.3 bu. below the trend yield of 158.3 bu. per acre.” Corn yield’s geographical variation, like soybeans, brings up a variety of questions as to why some states performed better than others. Schnitkey hypothesizes good growing conditions in the middle-eastern U.S. is likely a key factor in well-above trend yields.

The January 11th World Agriculture Supply and Demand Estimates (WASDE) will likely not be on time even if the government shutdown ends next week. According to Pro Farmer analyst Jim Wiesemeyer, USDA-NASS will need a full week to get the WASDE report released when the government reopens. While most of the information was gathered prior to the shutdown, analysis of the data remains, he says. House Democrats indicate they will push to end the shutdown when the 116th Congress takes over on January 3. “In a partisan bill, House Democrats will vote to reopen all the shuttered parts of the federal government when they take control of the chamber on Thursday,” Wiesemeyer says. “House Democratic leaders Monday released text of a spending package that would end the partial government shutdown. It includes six of the seven remaining spending bills and a continuing resolution for the Department of Homeland Security that would last through Feb. 8.” Meanwhile, the Republican-led Senate will not likely consider the measure which does not include border wall funding if President Trump indicates he won’t sign the bill, Wiesemeyer says. “Bottom line: both sides are bracing for a prolonged shutdown.”

While the vast majority of corn has been harvested, there are still some fields that have not seen the combine because of wet grain or swampy field conditions last fall. “If snow melts and soils allow, some farmers may opt to harvest yet this winter,” says Sara Bauder, South Dakota State University Extension agronomy field specialist. “When making late harvest decisions, it is important to take the economic comparison of storing and drying high moisture corn versus field losses and damage to wet soils into consideration.” One way to judge the cost/benefit is to estimate drying costs and dividing that cost into the local price of corn. That will give you an idea of the percent corn loss you could withstand by waiting and harvesting later, hoping the corn will dry down further. To estimate drying costs per point of moisture, multiply the propane price per gallon times 0.02, says Kenneth Hellevang, North Dakota State University Extension engineer and grain handling expert. Multiply that result by the number of points of moisture you need to remove from the corn grain to store it safely. For example, if propane costs $1.50/gal, it will take 3¢ worth of propane to dry one point of moisture ($1.50 X 0.02 = 3¢). If you need to dry 10 points of moisture, it will cost you about 30¢/bu to dry that grain. If your local corn price is $3.50/bu, the 30¢ drying cost represents about 9%. That would equal the amount of field loss you could withstand by waiting to harvest until spring. Hellevang notes that new dryers with saturators and vacuum cooling might improve dryer efficiency. And ‘wet points’ do tend to come off easier than dry points. For example, 14% moisture is harder to reach than 19%, and will take more energy on average then drying corn 25 down to 20%, he says.

County Farm Service Agency (FSA) offices rushed to get Market Facilitation Program (MFP) payments processed before a government shutdown closed the offices Friday, according to USDA under secretary Bill Northey. “Generally, if it got in and got through our payment system at FSA, even Friday morning activities, I believe it will be such that it'll get to get to Treasury, get to the Federal Reserve and actually get to the bank account, to the farmers,” Northey told AgriTalk Radio host Chip Flory. “So that's our understanding is that even though the offices are now closed, our process was completed to the point that they will go to the other parts of the federal government and finish that process and they'll go ahead and continue to process and make those payments.” Payments are only going to producers who applied for MFP and provided production information to FSA by midday on Friday. Applications are now on hold until the government shutdown ends. That could lead USDA to extend the current deadlines of Jan. 15 to apply for MFP and May 1 to provide production data, according to Northey. Meanwhile, the government shutdown is causing headaches for some participants of USDA loan programs including the beginning farmer program. “We may have some folks who are looking to pay off a marketing assistance loan, and because they took out a loan at harvest two or three months ago, they decided they’re going to sell that crop in January and they need to pay off that loan to be able to get clearance to move that crop,” Northey explained. “Again, that can’t happen right now with those offices being closed.” Northey noted that the Natural Resources Conservation Service (NRCS) remains open for conservation program signups during the partial government shutdown.

China is buying U.S. rice for the first time. The "South China Morning Post" reported Chinese customs officials cleared American rice for import on Thursday. It's not clear how much China will buy, but the U.S. rice industry calls China the 800 pound gorilla for the industry, and a market barrier it's been trying to break for decades. Johnny Sullivan of Producers Rice Mill, Inc. says "China is a monster of a market. The facts are based on the consumption rate of rice in China, the short story is China could chew through the entire U.S. crop in 14 days, so it's unreal." The news comes as leaders from the two countries prepare to meet in mid-January to continue trade talks. The trade war ceasefire between the U.S. and China started earlier in December, when President Trump and President Xi Jinping met at the G20 summit in Argentina. The U.S. agreed not to raise tariff levels if the two countries can come to an agreement on a host of issues, including trade. After a six month lull, China started buying U.S. soybeans in December. However, it hasn't been enough to appease traders, hungry for China to start buying large quantities of U.S. beans.

Cotton farms across Texas have been battling Mother Nature all year. Another curve ball came last week when a winter storm barreled across the Plains, dropping 10 inches of snow in its path. The weather further delayed a harvest already 30 days behind for one farmer. "We're getting to where these bolls are going to be very susceptible if we get moisture on them with anything kind of freezing temperatures, it's going to pull them to the ground," said Dahlen Hancock, a farmer just south of Lubbock, Tex. The issue is showing up in more than just Texas. National Cotton Council (NCC) says the entire south is battling weather this fall, making for a very difficult harvest. "It has been a difficult harvest when we look across the Cotton Belt," said Gary Adams, CEO of NCC. From two major hurricanes to extremely wet weather blanketing the South this fall, weather hindered harvest this fall, with a portion of the crop still in the field. "My guess is even though we don't have any updated data from USDA, we' probably feel like we're somewhere in the range of another 15 percent of U.S. acres yet to be harvested." More than just the harvest crawl, the quality of the crop is suffering in some instances, which is eating away at what farmers will be paid. "Wen we look at the USDA quality reports, really what we're seeing is some of the quality characteristics related to color, a little bit below the 5-year average," said Adams. "I think really that's where the weather is having its impact is on the color side and we're seeing that in all the regions." As for yield, the crop is struggling in Texas. Cotton harvesters on dryland acres show how sparse the crop is, with some farmers not even breaking even on those acres. "I'm a fourth generation farmer, so believe me, I've seen good and bad, and we're just proud of what we have, and we're grateful for what we have," said Hancock. Gratitude and relief for Hancock, thankful he even has a crop to harvest this year, as the "fabric of our lives" falls short this season.