WILLAg Newsletter | February 25, 2018
This week the drought in Argentina worsened. Our Commodity Week analysts believe the trade rallied enough to offer old and new crop soybean sales opportunities in the $10 cash range. This price is still well below what most think is the longterm mid-point for cash and futures. It tells a story. The world has a constant supply of soybeans that comes online every six months.
The Friday USDA Cattle on Feed report was rough. Take a listen to the Friday Closing Market Report to find out how rough.
USDA Ag Forum 2018/2019 Crop Estimates |
|---|
| released Friday, February 23, 2018 |
| Acres | Yield | End-Stocks | Crop-Avg-Cash |
|---|---|---|---|
| 46.5 | 47.4 | 0.931 | $4.70 Wheat |
| 90.0 | 174.0 | 2.272 | $3.40 Corn |
| 90.0 | 48.5 | 0.460 | $9.25 Soybean |
USDA made some projections for the coming growing season in the United States and it laid out a bleak picture of U.S. competitiveness on the global export market over time.
Don’t forget to buy your ticket for the All Day Ag Outlook. It is Tuesday, March 6, 2018. The markets are getting more interesting, and so are the agricultural politics. Each has a direct impact on your back pocket. The cost is just $30 and includes your morning coffee, roll, and Beef House lunch.
A dozen of our regular WILLAg analysts will be on hand to answer your questions, Eric Snodgrass will be there to take up the weather forecast, and we’ll discuss dicamba in an unfiltered way. It’s just about a week away, so don’t wait. Buy your tickets now.
Thanks!
Todd
Todd E. Gleason, WILLAg.org
University of Illinois Extension
(217) 333–9797 or tgleason@illinois.edu
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Tax Reform May Have Already Fixed the RFS RINs Issue
a conversation with ILLINOIS Ag Economist Scott Irwin
Next Tuesday President Trump will meet with Senators Grassley, Ernst, and Cruz to discuss how ethanol RINs are related to a refinery’s bankruptcy in Pennsylvania. Secretary of Agriculture Perdue and EPA Administrator Pruitt should be in the room, too. They’re hoping to work out a fix for the oil industry. However, as you’ll hear, the gap isn’t that big anymore and the Trump tax cut may solve the issue.
read farmdocDaily article
by Scott Irwin, University of Illinois
excerpt - Implications
The political battle over the RFS has centered on the high price of ethanol RIN credits that are used to comply with the RFS conventional ethanol mandate. Independent “merchant” refiners claim that large RINs costs have materially harmed their profitability. We show in this article that high D6 RINs prices can be directly traced to conventional ethanol mandates that exceed the E10 blend wall, creating a gap that has to be filled by biodiesel.
When biodiesel takes on the role of the “marginal gallon” for filling the conventional ethanol mandate, this forces the price of a D6 ethanol RINs to equal the much higher price of a D4 biodiesel RINs. This is essentially the story of the RFS and the resulting political battles since 2012. What has received little notice is how rapidly the conventional ethanol gap has shrunk since 2014 due to the combination of: (1) the crash in crude oil prices stimulating gasoline consumption, and (2) an improving economy. For example, the latest ethanol use estimate from the EIA for 2019 implies a conventional ethanol gap of a little less than 300 million gallons.
This gap is so small that an increase in projected ethanol use for 2019 of just two percent would erase the gap completely. This means it is not out of the realm of possibility for D6 RINs prices to fall back their pre–2013 level of just a few cents without making any changes to the RFS. In this sense, “fixing” the RFS is getting easier and easier.
All Day Ag Outlook
The annual WILLAg All Day Outlook is just a month away. Please plan to join us at the Beef House in Covington, Indiana Tuesday, March 6, 2018. Our line up is stellar this year. Check out the agenda below and buy your tickets today. The $30 price tag includes Beef House coffee and rolls in the morning and an always worth-the-wait lunch. Come met our analysts and bring your questions! We’ll open our doors at 8am central / 9am eastern time.
buy tickets online today
Beef House
16501 Indiana 63
Covington, Indiana 47932
Agricultural Weather Outlook
* Eric Snodgrass, Meteorologist - Agrible, Inc.
Cash Grain Panel
* Aaron Curtis, MIDCO - Bloomington, Illinois * Todd Hubbs, University of Illinois * Brian Stark, The Andersons - Champaign, Illinois
* Chuck Shelby, Risk Management Commodities - Lafayette, Indiana
Dicamba Unfiltered
* Aaron Hager, Extension Weed Scientist - University of Illinois
Soybean Panel
* Ellen Dearden, AgReview - Morton, Illinois
* Bill Gentry, Risk Management Commodities - Lafayette, Indiana
* Pete Manhart, Bates Commodities - Normal, Illinois
* Bill Mayer, Strategic Farm Marketing - Champaign, Illinois
How Grain Marketing is Changing
Block Trades, Variable Rate Storage, & the Tax Law
* Curt Strubhar, Advance Trading | Alliance Director Grain & Feed Association of Illinois
Corn Panel
* Curt Kimmel, Bates Commodities - Normal, Illinois
* Wayne Nelson, L&M Commodities - New Market, Indiana
* Mike Zuzolo, Global Commodity Analytics & Consulting - Atchison, Kansas
* Dan Zwicker, Zwicker Consulting - Waco, Texas
A Conversation with Emerson Nafziger, Extension Agronomist
2017 was an unusual growing season in Illinois. Todd Gleason caught up with Extension Agronomist Emerson Nafziger to talk about it and what farmers should consider this spring.
The Soybean Yield Gap, 63 Bushels on the Table
A university research project across the Midwest is hoping to bump soybean yields dramatically. Todd Gleason has more on how farmers can turn what they’re doing now to raise soybeans into the data feed for the project.
Test Your Integrated Weed Management Knowledge!
by Aaron Hager
Test your knowledge of integrated weed management (IWM) with this short quiz. The quiz is anonymous, and the answers will be revealed at the end.
Effective long-term weed management requires integrating multiple effective techniques, as opposed to relying solely on one or two tactics. This is particularly true as troublesome herbicide-resistant weeds continue to develop and spread throughout the US. Diversifying weed management tactics, preventing the introduction of new weeds, and varying herbicide modes of action reduces the spread and establishment of resistant weeds.
This brief, anonymous, 20-question quiz will test your IWM chops and help us give due credit to how farmers are using IWM throughout the US. All answers are completely anonymous and optional.
Answers are score are revealed after clicking “Submit.” Click here to take the quiz: https://www.surveymonkey.com/r/SD9RT6R
The quiz was written by weed scientists from 14 universities with funding from the USDA Agricultural Research Service and is being distributed in states all over the US. Find more information on IWM and herbicide resistant weeds at www.integratedweedmanagement.org.
French President Confronted by Farmers Over Glyphosate Ban
While I’m note sure this is exactly the moment which Emmanuel Macron is passionately telling a farmer he must ban the use of glyphosate because of the health problems he believes it may cause (cancer), it clearly shows him engaging directly. The French President visited his nation’s largest agricultural show Saturday in south Paris.
Farmers there booed him.
They are concerned about a proposed glyphosate ban, increased investment in farm land by China, and trade talks between the EU and South America.