READ the NAFB’s National Ag News for Monday, May 11th

READ the NAFB’s National Ag News for Monday, May 11th

Sponsored by the American Farm Bureau Federation

Farm Bankruptcies are Rising

Recently released data from U.S. Courts show that farm bankruptcies increased 23 percent year-to-year. An American Farm Bureau Market Intel report shows a total of 627 filings took place during a 12-month period that ended in March of 2020. That makes five straight years of Chapter 12 bankruptcy increases, including a faster rate of filing since January of this year. Wisconsin was the hardest hit with 78 filings during those same 12 months. Nebraska was next with 41 filings and Iowa was third with 37. More than 50 percent of the Chapter 12 filings took place in the thirteen states of the Midwest, followed by 19 percent in the Southeast. “Each bankruptcy represents a farm in America struggling to survive or going under, which is both heartbreaking and alarming,” says Farm Bureau President Zippy Duvall. “Even more concerning, the difficulty in staying afloat is made worse by the pandemic and related shutdowns as farmers are left with fewer markets for their products and lower prices for the products they do sell.” Currently, the bankruptcy filing increase isn’t related to the pandemic. That is certain to change as U.S. unemployment is projected to reach over 14 percent in the second and third quarters. A decline in off-farm income will hurt small and medium-sized farms that often rely on off-farm income to supplement their bottom lines.


China Purchases U.S. Corn

The USDA says Chinese buyers purchased 686,000 metric tons of U.S. corn last week. Over 370,000 tons will be delivered in the 2019-2020 marketing year, with the rest going overseas in 2020-2021. This seems to suggest that China is following through on its obligations in the Phase One trade deal. In a statement to Agri-Pulse last week, the U.S. Grains Council says, “China’s recent purchases of U.S. corn place the country back in the top five markets for U.S. corn, which is promising news for American farmers during this critical time. China has been a strong customer for U.S. corn, sorghum, DDGs, and ethanol in past years.” USGC is hopeful that Chinese customers will continue finding a lot of value in U.S. coarse grains and related products in the years to come. The purchase of 315,000 tons announced last Thursday was especially large, almost triple the export sales for 2020-2021 corn in the entire week of April 24-30. That was 97,500 tons to buyers mostly located in Japan and Panama. Bryan Lohmar is the China Director for the USGC. He says, “We’ve already seen exports greater than the past few years, and China typically buys the most corn during summer months when its own supplies get tighter and domestic prices firm up.” China’s corn-buying began back in March with a purchase of 756,000 tons, reported on the same day the Asian nation bought 340,000 tons of U.S. wheat.


Multiple Meatpackers Will Reopen This Week

Ag Secretary Sonny Perdue says meatpacking facilities across the U.S. will be reopening this week. He says the companies are opening up again “safely” and are a critical part of the nation’s infrastructure. These facilities have resumed or plan to resume operations this week following an Executive Order from President Trump directing the facilities to implement the Centers for Disease Control and Prevention and the Occupational Health and Safety Administration guidelines specifically created for the meat and poultry sector response to COVID-19. The USDA has been working around the clock with the CDC and state and local health officials to ensure a safe and stable supply of protein is available for American consumers while keeping packing company employees safe. “America’s meatpacking facilities are reopening safely to ensure that America’s producers and ranchers will be able to bring their product to market,” Perdue says. “I want to thank the patriotic and heroic meatpacking facility workers who are returning to work this week so the millions of Americans who depend on them for food security can continue to do so.” Plant locations in Iowa, Kentucky, Maine, Washington, Nebraska, Wisconsin, Minnesota, South Dakota, and Illinois are slated to get back to work this week.


Biofuel Groups Grateful for Support in Washington, D.C.

Two-dozen senators recently sent a letter to the Environmental Protection Agency calling on the Trump Administration to reject calls to alter or get rid of the Renewable Fuels Standard. The letter says it is nothing but an oil industry-backed effort to get rid of biofuels. The senators wrote that waiving the RFS would exacerbate the effects experienced by the biofuel sector as a result of COVID-19, causing far-reaching detrimental impacts on employment, farmers, food security, fuel prices, and the environment. “We are grateful for our champions who stand shoulder-to-shoulder with rural communities confronting a wave of biofuel plant closures, farm bankruptcies, and demand destruction amid the COVID-19 pandemic,” says Growth Energy CEO Emily Skor. “The oil industry’s attempt to steal markets from farmers and biofuel producers threatens to dash hopes of an economic recovery in the farm belt.” Kurt Kovarik, Vice President of Federal Affairs at the National Biodiesel Board, says, “America’s biodiesel producers appreciate the strong leadership of the senators who oppose the efforts to undermine the RFS. Maintaining a strong RFS will be critical to the rural economy’s recovery.”


McCarthy Setting up a “Chinese Task Force”

House Minority Leader Kevin McCarthy announced he’s forming a Republican “China Task Force,” citing Chinese ownership of Smithfield Foods as part of the reason behind the move. The Hagstrom Report says McCarthy found it interesting that “China owns a processing plant in South Dakota” and wondered if that could be a challenge for the U.S. food supply. McCarthy says the task force will include representatives from 10 congressional committees and will look deeper into the U.S.-China relationship. There were Democrats included in the original formation, but they dropped out, which McCarthy criticized them for. The task force recommendations could influence the agricultural trade relationship between the two countries because trade is typically more robust when the relations with China are solid. The Hagstrom Report quotes a senior Democratic aide who says those on that side of the political fence are “very cognizant of the need to hold China accountable for its actions.” However, the aide says, “To that extent, this is going to be the Trump Administration’s scapegoat for its utter failure, we are not going to go along with any of that.”


Washington Potato Growers Give Away Potatoes to Avoid Food Waste

Washington is number two in the nation when it comes to growing potatoes, sitting behind only Idaho. The Washington State Potato Commission says a billion pounds of russet potatoes that would normally become French fries and hash browns are just sitting in warehouses that would need to empty out just ahead of the July harvest. The organization is instead handing out the surplus for free to Washington residents, 100,000 pounds at a time. Reuters quotes Brandy Tucker, the director of marketing for the commission, as saying, “Everyone in Washington would have to eat 500 pounds of potatoes from now until the Fourth of July to clear our pipeline.” About 90 percent of Washington’s potato crop is processed for food service industries, nearly half of which is international markets. The commission is planning over a dozen donation events before the end of this month. However, even giving them away comes at a cost because of washing, bagging, and shipping the spuds. The USDA says it will buy an additional $470 million in excess food, which includes $50 million worth of potatoes, to give to the nation’s food banks.

SOURCE: NAFB News Service