Elk on the Prairie

Joe Moade
CPS Tangent


This Monday while in the Halsey area scouting fields I came across two spike elk in the Peoria and American Drive area.  While this is not an uncommon site on the edges of the valley, seeing them in one of the area's largest open areas was quite the site.


Two Spike Elk North of American Drive.

Commodity Prices Affect Our Business Immensely

Josh Nelson
CPS Tangent


Commodity prices affect our business immensely. The table below shows trends between Nitrogen, Diesel and Wheat prices from 1993-2011. 
 
World economies, power struggles in developing countries and natural disasters have made for very uncertain times. No surprise to anyone, commodity prices are volatile. These three commodities are trending nearly twice their 18 year average. The 18 year average for Nitrogen is $0.34 ($/unit), Diesel $1.84/gal and Wheat $4.95/bushel. As of March 2011 prices for these are Nitrogen at $0.59, Diesel $3.87/gal and Wheat $8.55/bu.
As in 2008 the question is will these prices hold through the summer and fall? Will prices continue to rise? Will there be a correction? In 2009, commodity prices fell 20% on Nitrogen, 40% on Diesel and 50% on Wheat.
There will continue to be many questions and concerns moving into the harvest season of 2011, however, as with any turbulent markets there are opportunities as well. Carefully consider crop rotations, no-till versus conventional planting, bailing straw versus chopping, soil testing, nutrient management, etc. Ask your CPS fieldman about nutrient removal when bailing; it is important to understand the true value of your straw. Develop cost effective strategies to managing nutrient deficiencies with Nature’s Supreme, Lime and Variable Rate applications. Sign up for commodity reports from Tangent CPS website, USDA Grain Reports, Pendleton Grain Growers, etc. Keeping yourself informed will help you find and take advantage of these opportunities.

Grain Market Report 25Mar2011

Tanner Sheahan
CPS Tangent

Predicted bid prices for wheat look about the same as yesterday but next year's futures are looking up a little bit at $7.50.

Here's an interesting website by NOAA to see precipitation history in Oregon, you can specify years and months to look at clear back to 1895. This site from Current Results shows averages for various areas in Oregon.  This is a pretty interesting article from The Register-Guard with some anecdotal weather information and some good suggestions for breaking our year up into more seasons in Oregon.  [T]he problem isn’t our weather. The problem is we try to filter our understanding of such weather through the same overly broad distinctions that the rest of the world goes by: winter, spring, summer and fall, says author Bob Welch.  It's a pretty interesting/humorous read and worth your time.  After all, what else do you really have to do today with soggy fields and 1.4" of rain predicted for this weekend?  Keep your chin up...and your hood up...and your hat low.

25Mar2011

Punxsutawney Phil, better get his act together, it has been nearly 6 weeks since he ‘didn’t’ see his shadow and not much evidence of an early spring…
               Futures called up with nearby corn leading the way called 8-10 higher. Western HRW country is mostly dry and the outlook is for more dry to continue with little chance of precip. La Nina is still expected to be around till June. Paris wheat futures were sharply higher overnight, up 2.7%.
               Chinese bean imports were 3.9 myn mt for March. Indonesia bot 7.8 myn bu of Indian corn. Argie’s corn harvest is delayed due to rain. The NCP (North China Plains) will be dry the balance of the month, but will see some warming….they need rain….badly. At least as bad as our HRW belt where most of the crop is still rated P-VP. The IGC (Int’l Grain Council) nudged last years wheat production a bit higher increasing wheat production up 1.6 myn mt world wide.

***Didja Know: According to the 2010 census: State of Michigan was the ‘biggest’ loser. North Dakota showed the biggest % increase since 1990 (840%).  To give you an idea, others were: South Carolina 1%, Maine 11%, Hawaii 32%, Connecticut 36%, Wyoming 36% and West Virginia was 213%. According to the census the population density of New Jersey is HIGHER than that of INDIA?

Grain Market Report 24Mar2011

Tanner Sheahan
CPS Tangent

Wheat is making a bit of a rally this week, slowly.  Dan's report shows prices between $7.15 and $7.35 from now through harvest.  The end of the year is a little better at $7.50.  New crop for 2012 is at least over seven bucks sitting at $7.19 right now.

24Mar2011
Lots of ‘behind the scenes market stuff happening’. Futures were unch’d early this morning, but an hour in, wheat found strength (weather?) and is up 20. Next weather system MAY provide up to ½” of precip to W. Kansas (this would be significant). TX is still very dry and now posting worst conditions in 44 years. One weather service is saying that a another cold system will move through Monday nite and temps could get to low 20’s for 4+ hours. Colorado is in as bad/ worse shape as Kansas, but they run a little later, so have a little more time. US wheat conditions are important, but I get sense world trade is more focused on the Black Sea/ FSU region, which is still pretty dry, but at least conditions are favorable to get LOTS of field work/ planting done. S. Africa is still dry, but is not a major concern at this time. China’s Yangtze valley received very good precip, but this system did nothing for the NCP (Northern Chinese Provinces), where the very dry/ very cold continues (see article at the end of report). China did book 4.2 myn bu of wheat. Mostly DNS, but some SWW and SRW. Export Sales reports: Corn was 35.2 myn bu which was dead center mid range of expectations, while wheat was 24.2 myn bu, also dead center.
             Portugal’s PM offers to resign after Parliament refuses his budget with its austerity cuts. The Parliament is counting on a bailout from the EU (this estimated at $99 byn). Portugal believes they will be treated more favorably by EU than Ireland or Greece because their situation is ‘less dire’…hmmm. Back home the temp budget band aid is coming loose on the US budget and not much progress being seen. The CFTC is expected to make a ruling on spec limits on or by the 28th. This could have HUGE market implications, but most of the industry is expecting more of what we have gotten in the past…not much to nothing. Even if existing position limits were enforced we would have HUGE market movement, let alone new ‘tighter’ restrictions. It just feels today like there is a large lack of interest in dealing with the whole thing.
             Ethanol: Ethanol groups have been quietly working behind the scenes to save/ salvage what they can of the blenders credits/ tax subsidies. Current policy is NOT favored by current Congress and is expected to cost tax payers $5.6 byn. Ethanol groups are willing (as if it is their choice) to give up tax credits, but favor a gradual reduction over the next 4 years. They would also like to see the savings rolled into variable tax rates, have the money spent on variable ‘blender’ pumps or to mandate higher blends (which would not save $ from the budget but re-direct back to E industry). By the way, Ethanol margins remain strong, and the US is on pace to produce 14 byn gallons and use 5 byn bu of corn doing it (another 50 myn bu more than USDA is projecting). According to EIA ethanol inventories are up 1% and 8% of current production is being exported.
             Here is a link to an interesting article regarding China’s grain production/ usage needs: www.earth-policy.org/plan_b_updates/2011/update93

Filbert Growers: EFB Sprays

Cameren Moran
CPS Tangent

Its that time of the year to be thinking about Eastern Filbert Blight Sprays. Commonly sprays have started early to mid March and are recommended to continue on every 2 weeks until early May. I found a helpful EFB page by Jay W. Pscheidt who is an extension plant pathologist at OSU. The link is below.

http://oregonstate.edu/dept/botany/epp/EFB/management.htm

If you click through this it has a lot of information that is quite helpful if you have questions or concerns for EFB in your orchard.

If you have further questions on this topic or related topics be sure to talk with your CPS field man.

Wheat drops $0.95 in the last week!

Corey Burns
CPS-Tangent

Good Morning. It looks like we may finally be getting a couple of decent days at the beginning on next week. At least that is what they are saying today! On a darker note, wheat prices have dropped $0.95 in the last week. At $6.80 we are still well above the historical average of around four bucks.The price is at its highest in May at $7.08. Next years crop is at $6.88.
Get you buggies and trucks ready to hit the ground running next week. You may not have a very big window to get that fertilizer spread. Have a great weekend!


             Crude is up near $2 in early trade, Gold is up $5, US $ is at all time lows vs. the Yen. Sorta sets the table for this mornings activity (everything called sharply higher… +.15 to .20). Sales report showed very strong numbers in corn with 40.8 myn bu of o/c sales and 11.8 myn bu of n/c sales. Traders were expecting something totaling about 19-31 myn bu. So the 52.6 myn bu will be a pleasant surprise. Even after the washout, corn fundamentals remain decidedly friendly. Wheat sales were also strong with 24.4 myn bu of o/c and 7.6 myn bu of n/c. The 32 myn bu total was also more than traders expected as they were looking for something in the 18-29 myn bu range. One thing about wheat though, all year long sales have looked pretty good, the problem is with actual shipments which are lagging badly (remember all unshipped bushels will be added to the S&D’s at the end of the year). Weather man is calling for hard freeze in the next 8-9 days (next weekend). Today it looks like it may extend far enough south and west to at least hit part of the HRW country. SRW will certainly be exposed. What the temps do just before the cold snap will have a large impact on what damage may occur.
             Brazilian gov’t will allow a ‘Major’ seed company to start selling GMO corn seed. This will be the first 5 gene stacked corn in Brazil and means the 2012 crop may be a large % of GMO. Serbian gov’t has suspended wheat exports. They have already booked 23.8 myn bu vs. a total quota of 18.3 myn bu.

PGG's Market Report

Extension Tour March 16th

Jason Bennett
CPS

Here is a link to the Extension Tour that Mark Mellebye is putting on. The Tour is going to be in the Shedd area, it starts at 1pm Wednesday the 16th. The tour is going to consist of looking at using windmills for drainage, no-till wheat into wheat stubble, use of row cleaners in late summer no-till annual ryegrass, then the tour will finish up with talking about air injection nozzles and row spray nozzles. If you can't make it ask your CPS fieldman to give you the hi-lights. Hope to see you there.

Grain Market 7March2011

Corey Burns
CPS-Tangent

Good Morning All!

Hopefully you got some fertilizing done yesterday. It looks like we should be getting about 1 3/4" of water between now and Friday morning...hopefully we get a few more decent days before too long.

It looks like the wheat market has stayed fairly level in the last week. Today's price is $7.80 and the peak price is $8.05 for June Sales. Futures for 2012 are down slightly at $7.46.


     Markets started with a small uptick, but again took a left hand turn and we are SHARPLY lower this morning with wheaties down 28-30 and corn off 13-15. $$ is down, crude is up sharply and Gold is up $15. We are seeing more profit taking a bit of ‘flight to safety’ in this mornings trade. Unrest continues in Libya, is growing in Bahrain and is also spreading to Saudi and Kuwait. China is also concerned and has stepped up security. Media is not allowed to film or interview protesters. Protesters are just showing up and milling around in HUGE numbers, tying up traffic and slowing everything down. The Gov’t there has also blocked underground internet/ phone. Inflation rate in China is very high. Obama is talking about opening strategic reserves. We have an new USDA S&D out Thursday…Those are pretty much the headlines.
             Weather man says that HRW should get a drink this week before turning back to dry. Last system skipped over the driest areas and hit further east. Corn planting has started in Texas, but will struggle north as the weather gets very wet, very fast heading east/ southeast. COT report was highlighted by overall spec liquidation in Chicago SRW and a build in corn. Corn is still friendly. Weather system give the east more precip (they don’t need anymore) and at least 1 major weather service is forecasting big time flooding in the mid west this spring. Informa rated the Brazil crop =3 myn mt to 71.4 myn mt, and also took Argie up 3 myn mt to 52 myn mt.

             Chinese gov’t is talking about totally banning corn exports, has ordered 4 major feed companies to ‘not buy corn from the market’ (which drives up prices). If you can believe the Chinese stocks numbers, they say they have 100 myn mt of wheat on hand. I haven’t seen anything on corn numbers, but the market chatter is LOUD that China will need to make major corn purchases from someone before summer. Weather in the Chinese wheat belt that was ‘severely dry’ then got much needed precip is supposed to return to dry…we’ll need to watch this closely. The Chinese population has become somewhat accustomed to a higher standard of living, and won’t want to give it up easily. Chinese farmers are known to be hoarding everything…cotton, corn, wheat, rice. Prices are escalating so fast it is their only hedge that they will be able to buy what is necessary to farm another year. Consequently the market has NO confidence in the Chinese Gov’t numbers, and for that matter, those out of India, Pakistan etc.

             Iraq booked 14.5 myn bu of wheat (11 of it US). GASC (Egypt) says that they are good for 5 months…with today’s board action, it will be interesting to see if there are ‘buyers of the breaks’ around. Morocco booked 10.3 myn bu (EU)? Mexico bot 5.9 myn bu of US corn. Argie strike ended opening up roughly 20% of Argie export capacity.

             So you can see the market has plenty of stuff to sort through today. Be prepared for LOTS more days like these…by the way…the Budget proposal sent from the House had NO funding for E15 pumps.

***Didja Know: According to the USDA, 44 myn people in the US (15% of the population) is receiving food stamps?
***All bids are subject to change, please call for CONFIRMATION of prices. All information in this letter is from sources deemed reliable, and is for informational purposes

Magnesium an interesting read

Jason Bennett
CPS

Here is a link to a great article on Magnesium and the importance it has in crop production. I will warn you this article has a lot of science behind it but at least read the couple paragraphs under Magnesium deficiency is a growing problem which is on the first page, right-side halfway down, it will be worth the time.

Still holding onto wheat?

Corey Burns
CPS Tangent

Still have wheat in your warehouse? We are now into March and your Malathion or Storcide application at harvest is well past its life span. Bug activity is at its best at temperatures above 68 degrees Fahrenheit. The average core temperature of wheat stored in the valley today is around 60 degrees Fahrenheit.  As we move into spring that temperature will start increasing and could bring the beetles alive. Even at temperatures in the low 60’s I am finding a few beetles at the very bottom of piles. The three most common beetles I’m finding are the confused flour beetle, red flour beetle, and flat grain beetle. These beetles are only about 3mm long and are pretty hard to spot. When your wheat is being graded it only takes 3 live insects to be considered “sample grade” wheat. If you have any concerns about bugs in your wheat contact myself or your CPS fieldman.
Flat Grain Beetle next to a kernel of wheat









Corey Burns
541.990.7639
corey.burns@cpsagu.com




Wheat Still Bouncing in the High $7's and a Couple Links

Tanner Sheahan
CPS Tangent

Welcome to March!  It's wet...

I thought I'd change up the title today since "Grain Market Report" is getting a little monotonous.

Wheat is knocking at the $8 door again.  Post harvest prices are $7.80-$7.90 and pre-harvest prompt is only slightly higher in May at $7.95.  Futures still seem fairly steady, and at a profitable level, at $7.59 for 2012.

Here is an interesting article that was forwarded in an email this morning; some unconventional nutrients mentioned here in relation to Boosting Grain Protein in wheat production.  While reading that article I saw this one, Global Fertilizer Needs, Production Expected to Grow, talking about some of the global trends and gives a little insight into why we are still riding the fertilizer roller-coaster.  The short version?  We aren't the biggest player in the market anymore.

28Feb2011

Futures were called lower, and responded accordingly. With the volatility we’ve seen lately though, it actually seems like a pretty mild day. Corn is off 2-4, all wheat futures are off 8-10. The drama in the Mid East continues. Saudi is trying to keep inflation in check and doesn’t want the political problems of its neighbors. They booked 10 myn bu of US HRW and a cargo of wheat from Brazil. By now everyone knows that the corn supplies will be tight, VERY tight, and the market has had time to allow participants to adjust…but where to from here? Will S&D’s get tighter? Or will some event (USDA finding corn) lead to higher C/O’s and lower prices? We do know that Egypt (apparently some form of gov’t is still functioning) and Mexico are both in for corn and that ethanol margins predictably widened last week. COT report was interesting in that it confirmed what we were ‘feeling’. Specs sold 65 myn bu of Chic wheat, while the funds also sold 20 myn …result is what we saw in futures the last week or so. Corn has been more stable and in fact is trading at highs….COT also confirms that the specs sold 34 myn bu and the index funds bot 83 myn bu. Index funds position was down to 1.33 byn bu…the lowest they have been since 10/09.
           Argie’s gov’t has dissolved the  ONCCA.. This would be the Office of National Control of Commerce Agriculture (loose translation)…they were the ones in charge of grain exports. Apparently this will now be handled by the Economic Ministry. No one seems to know exactly what this means, but it is another layer of confusion. Business at least short term will NOT be as usual. Weather man says Argie will be HOT/ DRY the next 10-14 days. Rain and snow in China were sufficient to completely lift ‘severe drought’ ratings. They will need more precip as spring unfolds, just like any other year though. Chinese gov’t is also rumored to be looking at reducing import tariffs to zero…SK already went there last week.
           USDA says ‘high amalyse’ corn (specifically designed for ethanol prod) will not harm food mfg/ processors or exports. Controls are in place and if followed will be sufficient. This is like another ‘genie in a bottle’. Once out, it will not go back in. We would have to be na├»ve to think that eventually there won’t be pollination drift or contamination…eventually in the seed. The ‘purest’ NON GMO seed to can find today is 99.5%, which is not acceptable to many markets. The USDA did say perhaps ‘color markers’ would be helpful. Yeah, they would because otherwise it all looks the same.
1Mar2011

Futures were called lower, and responded accordingly. Corn is off 3-4, wheats are down 8-10. Crude, gold and the $ are all higher. Most of the news this morning would be termed ‘friendly’. Yesterday’s export shipment report was ‘uninspiring’ with corn at 24 myn bu and wheat at 19 myn bu. Only 1.6 of it was SWW. YTD the US has shipped 862 myn bu vs. 625 (an increase of 6.5 myn mt) through this time last year. Very cold weather is set to hit the S. Plains. Crop scores released y’tdy pm were also ‘price friendly’: Tx crop scores improved 5% in the G-Ex to 18%, 56% is rated P-VP, OK dropped 2% in G-Ex to 19% with 42% P-VP, Ks dropped 2% to 25% G-EX with 40% P-VP, and Neb dropped 2% to 41% G-Ex with 13% P-VP. So Neb doesn’t look too bad, but the other ratings are very weak. EIA last week said that ethanol production set another new record at 1.195 byn gal. Exports are near 1.8 myn bbl, marking 14 straight months of ethanol exports…daily ethanol ‘grind’ works out to about 13-14 myn bu. CRC for corn ended up about $6/ bu vs. 3.99 last year…the corn bean ratio is neutral (futures are not offering any special deals to plant one vs. the other, acreage battle is toss up).
             ABS (Aussie Bureau of Stats) has rated the 2010 wheat crop at 56% milling quality and 44% feed quality…this would compare to 86/14 in a ‘normal’ year. Brazil’s summer (early) corn harvest is about 14% complete. Russian gov’t sold 12 myn bu of wheat to domestic markets from intervention stocks. Satelite images of the ‘Black Sea’ region show patchy snow cover. Russian gov’t is estimating that up to 10% crop damage could result from uncovered ground in cold weather (mostly Barley). They also are figuring that there will be some 76 myn acres of spring wheat planted yet this spring. There are a few glitches though: operating money is very tight, fertilizer supplies are erratic, and there is a question of availability of spring seed. These type of issues and spring weather will weigh HEAVILY on the markets as the spring unfolds.

***Didja Know: The Dept of Treasury says that China is holding $1.16 Trillion of US debt (about 30% more than they thought…re-assuring isn’t it)? Japan is number 2 and Britain is the #3 US debt holder (Japan/ Britain can get fuzzy since most of the Japanese trades are cleared through London).
“Watch how people spend their money, that is the best way to know what they believe” Anon.