READ the NAFB’s National Ag News for Wednesday, May 3rd

CLICK HERE to listen to TODAY's BARN Morning Ag News with Brian Allmer...

CLICK HERE to listen to TODAY’s BARN Morning Ag News with Brian Allmer…

Sponsored by the American Farm Bureau Federation

Read the NAFB’s National Ag News for Wednesday, May 3rd

Monsanto Terminates Sale of Precision Planting to John Deere

The U.S. Department of Justice announced this week that John Deere and Monsanto had terminated their attempted sale of Precision Planting, LLC., from Monsanto to John Deere. The department filed suit to block the sale on August 31, 2016, to block the acquisition. The reasoning behind the suit was the Justice Department felt the sale was a merger-to-monopoly in high-speed planting systems. The technology allows farmers to plant crops like corn, soybeans, and other row crops at twice the speed of a conventional planter. The case had been scheduled for trial on June 5. Acting Assistant Attorney General Andrew Finch said the decision to abandon the sale was “a victory for American farmers and consumers. Had this sale gone forward, significant head-to-head competition between Deere and Monsanto’s Precision Planting technologies would have been lost. That competition had led to lower prices and more innovative products.” The proposed sale would have combined the only two providers of precision planting systems. John May, the President of Agricultural Solutions and Chief Information Officer at John Deere, says, “We are deeply disappointed in this outcome as we remain confident the acquisition would have benefitted consumers.”  


Perdue Puts Hold on School Nutrition Standards

The U.S. Department of Agriculture is putting a temporary hold on National School Lunch Program regulations requiring less salt and more whole grains in school lunches. Ag Secretary Sonny Perdue made the announcement at a school in Leesburg, Virginia. He adds that USDA will lift restrictions to allow schools to serve flavored 1-percent milk rather than the non-fat version that’s required now. Perdue was quick to stress they aren’t rolling back any provisions of the Healthy, Hunger-Free Kids Act passed in 2010. The act required a gradual increase of nutritional standards, such as reduced sodium and an increase in whole-grain products in school food. “We aren’t winding back any nutritional standards at all,” Perdue said in Virgina. “We’re giving food service professionals the flexibility to move as we get to a healthier generation.” He even applauded former first lady Michelle Obama for her efforts to promote healthier food in schools. Perdue says he’s addressing concerns that the rising nutritional standards may be too expensive for schools, as well as students not eating the healthier foods.


Ag Producer Sentiment Slightly Higher in April

The newest Purdue University/CME Group Ag Economy Barometer inched higher during April with the index increasing slightly to 130. It’s up from the 124 survey index in March but still ranks well below the all-time high of 153 in January. When the current index is compared to last year, it’s 23 percent higher than the 106 in April of 2016. The biggest negative in the report is the expectations for future crop prices. 54 percent of the respondents expect soybean prices to remain “about the same” in 12 months, while 27 percent expect lower prices. Only 17 percent of respondents expect higher bean prices in the year ahead. Looking to expectations for the December 2017 corn contract price, only 28 percent of respondents thought it would be above $4.25 a bushel. Expectations are about as low for the November 2017 soybean contract. The percentage of respondents expecting soybean prices to exceed $10.50 a bushel plummeted from 44 percent in previous surveys down to 23 percent in April. A quarterly survey of agricultural “thought leaders” in agribusiness, ag lending, farm organization, as well as economists, saw a 12 percent jump in positive expectations for the ag economy’s health to improve.


Ag Lender Survey Shows Profitability/Price Concerns

A survey by the American Bankers Association shows nearly 90 percent of agricultural lenders have seen a decline in overall farm profitability in the last 12 months. 95 percent of the lenders in the survey expressed concerns about low commodity prices, especially in grains, beef cattle, and dairy. Grains are the biggest concern as 80 percent of lenders gave it a four out of a possible five rating. Grains are followed by beef cattle, dairy, swine, poultry, vegetables, with fruits and nuts the least concerning sector of ag. The decline in commodity prices led to a fall in farm income with tighter profit margins. Ag lenders in the survey say roughly 60 percent of their clients were profitable in 2016 and expect 54 percent to be profitable this year. Lenders are also concerned about land values. They say 44 percent of average quality land and 33 percent of cash rents are priced above fair market value in their particular area. Ag lenders also expect greater demand for debt financing thanks to lower cash levels on farms. 66 percent of the respondents expect greater demand for operating loans and 33 percent expect more demand for ag real estate loans.


TPP Nations Meet in Canada to Discuss Future of Pact

Bloomberg reports Canda is hosting what it calls an “exploratory” round of talks regarding the Trans-Pacific Partnership. Senior trade officials from the remaining countries in the pact are in talks this week in Toronto. The event is expected to be a stage-setter for an upcoming Asia-Pacific Economic Cooperation Summit in Vietnam. The article says this week’s trade talks are a sign that Canada may be looking for business away from it’s largest trading partner amid disputes with U.S. President Donald Trump over lumber and the dairy sector. Canadian Prime Minister Justin Trudeau responded to U.S. lumber duties by saying his country will try to sell more of its products in Asia. The Canadian government did leave the door opening to putting together a bilateral trade deal with Japan, which has the biggest economy in the remaining TPP countries. Trudeau said in a recent Bloomberg interview that Canada seems to be in a “post-TPP world.” Canada’s International Trade Minister said his department is happy that talks are progressing on TPP but declined to comment on the future of the pact.  


Organic Farmers Push for Welfare Standard Implementation

Organic dairy and livestock farmers are pushing for Ag Secretary Sonny Perdue to let animal welfare standards formed at the end of the Obama Administration to go into effect. Politico’s Morning Agriculture Report says the farmers argue that the long sought-after rules will give consumers what they want. The measure has long been supported by the USDA’s Organic Advisory Board and was supposed to be in effect on March 20. It was delayed until May 19 as part of an overall postponement of USDA policies to give the new administration a chance to review new rules left by the Obama administration. The group of over 300 farmers wrote in the letter that “the decision to become organic is voluntary. If consumers lose confidence in the organic seal, that will have a catastrophic impact throughout the industry.”  However, the new standards are opposed by the larger organic egg producers. They say the new requirements of more indoor space and access to pasture could be cost prohibitive, as well as open poultry flocks to a better chance of exposure to disease.

SOURCE: NAFB News Service