tv U.S. Farm Report ABC January 31, 2016 5:00am-6:00am PST
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dollar corn. he says el nino typically drops off quickly. and we're already seeing those pacific ocean temperatures cool. but when looking ahead, he thinks iowa could see the second hottest july on record with much of the cornbelt turning drastically drier. 2016 is 2012 all over again. i don't want to say it's going to be that bad because the stocks situation is different, but the weather is as bad as 2013. we are forecatsting the hottest, driest conditions since 2012. a little more widespread drought potentially. and then the disaseter that's' going on down in brazil. too dry then too wet right at harvest. the crop is going to be the second hottest and driest in brazil. so bad news coming in and makes the market go bang for those fokls down south. and then bad news about july here. we'll have one of the hottest july's in many years in the corn belt 4:57:34> kirk says he has trillions of data points to back up his forecast. oil prices rose to a three week high thursday on hopes major oil producing countries could trim output. the russian energy minister announced opec could discuss a 5
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agreement is made, it will be the first global deal in over a decade to help clear the growing inventory. cattle prodcuers could be facing less turbulent times in 2016. that's as cattlefax thinks the downward spiral in price could be coming to an end. cattlefax says the market correction has mostly occurred. they think cattle feeders will lose 200 dollars a head this year, stocker operators could face tight margins, but the cow-calf producers may see green. analysts say tight global protein supplies coupled with a strong export market in both 2014 and 2015, created the perfect storm for the market to peak, then plummet. that's it for news. let's check in with meteorolgoist mike hoffman for weather. mike, there's a pretty big storm brewing out west. how bad could it be? thanks, tyne. no doubt there is going to be a huge storm for a large part of the lower 48. we will get to those maps in a moment. in the meantime, drought monitor no
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california and western nevada although i'm sure you are saying this big storm is coming through, you know, how can there still be this extreme to exceptional drought? but it takes a long time to get out from a drought of this magnitude, but we are slowly eating away at that area out there, but should continue to do that. all right, here we go: monday, big storm through the four corner region, lots of heavy snow for the southern half of the rockies, a little bit of rain you get a little farther south some scatter snow farther north, off to the eastern parts of the country showers along this first cold front, this will bring in some cold air setting it up for the big snow storm for the middle of the country. now by wednesday, this storm is already into the northern great lakes. the track of it is going to make a big difference in whether you get heavy snow or heavy rain or both where you live. it is probably going to take a track east and then cut up northward into the great lakes, but it is a little farther east, but you may get snow where they are forecasting
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in parts of the western great lakes the way it looks right now for wednesday with rain along the east coast, but most of the western parts of the country just becoming very cold and that's going to continue as we head into friday. very cold air for the eastern half of the country, a few lingering snow showers in the great lakes, maybe a couple of showers in south florida and the next storm system not nearly as heavy, but it will be spreading some snow into the northern plains and rain and snow in most of the northern portion of the rockies. we will be back in our next half hour with a longer range forecast. thanks, mike. when we come back, it's our first marketing roundtable from the road in 2016. we'll head to the top producer seminiar in chicago, illinois. you watching u-s farm report with host tyne morgan, commentator john phipps meteorolgist mike hoffman and
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top producer's seminar is brought to you by channel. seedsmanship at work. learn more at channel.com. >> welcome back to u.s. farm report. as i mentioned we're here at the 2016 top producer seminar in chicago, illinois. a great panel with us today. we're going to jump right into the debate. everyone wants to know how this acreage picture's going to shake out. chip, we'll start with you. you think overall acres are actually going to be up this year? >> yeah, i do. we've got to take into consideration that last year we lost some acres to prevent plant and everything. total corn and soybeans about 170.6 million. this year, i think, we're going to be closer to that 173.5, 174 million for total corn and soybeans. now, how that gets split up there's going to be some room for debate in there, but right now i'm sitting at about 89 million
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so, yeah, a little bit of a lift there. >> and, bill, even if we see corn acres go up, what is the carryout picture look like for next year? >> yeah, even if we raise the corn acres close to a million acres, which is what we're guessing, if a trend line yield, which would be lower than last year, some is in play then corn acres. i agree with chip that, you know, with the prevent plant last year the total acreage planter wise, assuming we have a normal spring is probably going to bounce up a
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been talking to bankers this winter. i think the fringe areas, the far north and the north dakota and some of the let more marginal ground in the south could swing out of corn. >> right now when you put pencil to paper, matt, what makes sense for you? >> well, i ink the roi for most people on reasonably productive farmland says you should plant corn, but in my opinion i'm kind of like chip. you know, given the financial constraints we've had the last 18 months or so, there's a lot of producers that are not quite in the cash position that they were in before, and so when you get in a marginal type of situations, especially if it's a high input or high cash rent deal it's pretty tough for a guy to put a pencil to corn and really make that work, and i think that unfortunately in some situations the bank may have a little more to say about that this year than what they have in the last few years. >> well chip, we had some pretty excited top producer attendees this week when the weather trends guy said we're going to have the worst drought we've had since 2012. it's going to be more widespread. we're looking at six something corn. he had everyone excited. >> yeah. >> be the voice of reason here. do you think that's realistic this year? >> well, if
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yeah, it is realistic. you can put those numbers in play, but i sure wouldn't market for them. i wouldn't lay my marketing plan out in anticipation of even $4.50 corn at this point. i think what we need to do is, is keep in mind that number one, one of the reasons we all get excited about that is because it's going to happen on that chip's farm, not this chip's farm is where the drought's going to happen, and so i'm going to get my lift in prices, and i'm still going to have my yield. i think we need to look very seriously at how we look at our break even levels. let's look at how many dollars per acre it costs me to put in an acre of corn, and then whatever combination of price and yield i'm getting in total dollars coming back in on revenue. quit thinking about $5 corn or $4 corn. let's think about $750 an acre, and how am i going to get past my total cost. once i get past my total cost on potential revenue, i'm going to be more aggressive in making some cash sales this year. i'm going to back it up with some call
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side. >> matt, how is the situation different this year than 2012? even if we have a weather scare with carryout and everything. what is the realistic picture right now? >> i think going in we're coming down off of a higher commodity prices, whereas in 2012 we were kind of building. we'd had fairly good times for quite some time. i think going into this year most producers are looking at the situation we've had the last two years in which they wish they would have marketed more corn in '14 at $5 basis the board. we wish we would have marketed more corn in the middle of the summer last year, so i think maybe the different situation for me is i think people are more cognizant of the fact that we need to be a little more careful when we get rallies of actually taking advantage of those. yes, we need to cover them just in case we have a catastrophic weather event, but we also need to latch on when we get in the profit zone. >> does that weather scare have to happen in july in order to see a big run up on price? >> no, that's the thing is the timing of that and where, like chip said, how much damage does it do? i was thinking this morning too, you know, nobody was expecting a drought in 2012.
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throwing cold water on that at all because these long range weather guys have been pretty accurate for a while, but my point is, is kind of like chip, hey, let's think about if we do have that drought. the uncertainty right now we're talking about it in january. what's that going to do to your psychology in june july when it does get a little dry? so fast forward yourself psychologically out there and have a plan to know what you're going to do if and when that happens. >> worst yet, psychology-wise what if it doesn't happen? >> um hmm, exactly. >> i mean, you're going to be looking at the headlights coming right at you. you're not going to be able to move. >> well, if it's not weather what could give these markets a boost? bill, i'm going to ask you that when we come right back, so don't go anywhere. we'll be right back on u.s. farm
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brought to you by channel. seedsmanship at work. learn more at channel.com. >> welcome back to u.s. farm report. okay, bill, we've been talking about weather, but if the weather scare doesn't happen what could boost prices in 2016? >> well, as you know i've been bearish for so many years. i've had multiple hedges on, but honestly right now i'm flat. i'm watching the funds, and they're massively short right now, and they're trading on a deflationary basis, which is accurate, but if we see stability in the world and we see this dow market start to flatten out, and if we see crude oil start to flatten out that's my main things i'm watching is the dow and the crude and if that starts to flat i think these funds are going to short cover. now, let's take it a step further into the summer. if we see the labor market, which right now the number of unemployed people works out to about .25 people per square mile
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pressure raising wages, that's inflationary, and them i think the funds will start to reverse into a long position. and i think that that could really be a pretty significant thing that will help us get back up to equilibrium where we think equilibrium belongs. >> okay, chip, what are your thoughts on that? >> well, the wage inflation is unbelievably important in my mind, we just haven't seen a lot of wage expansion here over the last year. the participation rate in the labor market concerns me a lot. we've had people just exit the market, and i just think that the economy isn't nearly as good as what some people are thinking right now. so i think you're right, bill, that if we would get into an inflationary environment it would help the commodity markets. i just don't see it happening. i mean i'm on record calling for a quarter point interest rates at the end of this year. >> and the bad thing is if we don't see all those things happen and we have
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let's talk about oil prices. i mean, we've seen this price continue to go down. who knows when it's going to start going back up, but when it does how fast could we see oil prices recover? >> well, that's the question. with the spark plug in the middle east being something that could ignite us very quickly, so that's a big unknown. without some sort of turmoil or conflict there it's probably going to be a slower process, and that's fine. you'd rather have a slow grind back up to $45, $50, than some sort of conflict or issue in the middle east and just skyrocketing back to $60. so i think the key is how you get there. i do think it can slowly happen, and i agree with these guys. i think it's all tied to the dollar in a lot of ways for the whole commodity sector. and you want to talk about a crowded trade. >> yeah. >> there is a ton of longs that have been there for a year, year and a half, and so that's an old bull market now. and if you get any sign that the dollar can
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matt, let's look at the positives of these lower oil prices. we're enjoying cheaper gas, and as consumers look at that, more money to spend. are we seeing improvements in beef demand when they're penciling out their budget and say, hey, i can afford this steak. are we seeing that impact with consumer demand yet? >> well, that most generally is what happens, you know, but whenever we look at beef prices the last six, eight months it's not really been the rosiest of pictures. i think whenever you look at total numbers the call is for, i think, 102% of last year. to me cattle numbers still are not overwhelmingly large by any stretch of the imagination. i've been saying for quite some time, whenever we look at -- are we going to chew through these higher weights? once that happens i do this we're going to be able to rally the cattle market, but, you know, in my opinion there's a lot of guys that are cyclical cattle traders. i don't think they're going to buy in, and we're not going to go back and make new highs for these numbers yet. >> chip, when do we eat through these higher weights? i mean, looking at these feeders $500
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weights. the weights are going to be coming down. the computer says they ought to be weighing 1400 pounds, they're scaling up at 1280 or 1300 right now. so i think we are starting to see the weights come down for us. that's going to eat into that beef production a little bit. i think we'll get a draw on beef and cold storage probably in march, and once we get that draw in cold storage stocks that's when we'll start to see a little bit of lift to the pressure off the market. >> do you have any hope for cattle producers, chip? >> i do, in the short run in the next three months, say, but matt touched on it earlier. these numbers are building. that's what record high prices do is they slowly build the herd and it kind of fixes itself. they say the cure for high prices is high prices, so i think the top's in, but that doesn't mean we have to go back to $100 cattle any time soon. i think we're more in a range $110 on the downside, $140 on the topside. that's probably a good range for the next six or nine months. >> all right. we're
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thoughts. bill, let's start with you. >> well, i think this is going to be a year where cash flow becomes a challenge even if you were a guy like me and had stuff sold out a couple years out ahead. so my game plan this year is come up with a strategy where i can meet my costs, cover my costs, but then cover my sales so that if we do have that drought i'm in the game. >> good advice. chip nellinger? >> yeah, to build on that, have a plan. put yourself out in time. what if the drought comes? what if it doesn't come? have a plan now to know what you're going to do in both situations. >> okay. matt bennett? >> i think the number one thing for me is know your break even price for corn and soybeans, and when you get in the profit zone and we start to get a rally potentially let's not get bullish at that point. >> right. >> chip flory? >> being here at the conference or
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just a little bit and say "take every opportunity." when there's a profit to be made, take it. >> all right, thank you. please stay with us, john phipps join us when we come back. receive a free trial of the daily market letter and gain knowledge about current market conditions from the professionals at bower trading. view the markets like never before go to bowertrading.com.
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many at the 2016 top producer seminar this week, including john phipps. for any other farmers who admit to watching downton abbey during playoff season, i have a question. amid all the major plot developments, emotional turmoil and romantic intrigues, did you find your interest most drawn to the minor storyline concerning assistant cook daisy's father-in-law, mr mason, who lost his tenant farm when the estate owners sold out, and whether he could get another one available from the grantham estate. given the truth and rumors of a still roiling 2016 land rental market in the midwest, edwardian england's system of permanent - and often perpetual - farm rental commitments from owners is almost as attractive to some of us as lady mary. almost. this somewhat feudal system might
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inhertance taxes by parliament to pay for the world wars. indeed, it's why downton and neighboring estates are facing a perilous financial future. the vision of rock solid land rental security can seem ideal as we cope with landowner negotiations this year, but it is helpful to recall the downsides for agriculture. good farmers had a harder time getting ahead, as there was no competitive arena to exploit your skills. farming was even more a closed, hereditary occupation with no way for even highly skilled non-farmers to get started. finally, the system protected both good and bad farmers, meaning ag output was not very efficient, or able to change rapidly. i would imagine it was pretty frustrating for ambitious, capable farmers. still, the growing insecurity of tenant farming today makes even these disadvantages seem worth tolerating. my guess is the economics of renting land will have to get even more dismal before landowners no longer
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that's okay by him. now for the headlines, as viewers in the rockies, plains, midwest and even great lakes prepare for possible blizzard conditions this week, our friends in the south and east are still digging out. the fatal snowtorm dropped 42 inches in west virginia. and just to the north, snowplows moved throughout the weekend in arlington, virginia.. as snow didn't stop until early sunday morning. to the south, the fierce weather forced prodcuers to dump milk in kentucky. as you can see from these pictures, trucks couldn't make it down roads to pick up milk and officials still don't have an accurate count of how many pounds went to waste. the state's dairy development council tells us producers first faced ice, followed by snow, causing barns to collapse. as california farmers and ranchers receive welcomed rains, it's boosting hopes of a more tolerable year. and it's just announced this week farmers will receive a boost in allocated
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estimates are now at 15 percent. that's up from the 10 percent announced just last month. it's not a full recovery, as the recent rains haven't completely healed the struggling state. area farmers haven't seen 100 percent of their annual water allocations in 10 years. meanwhile the federal agency which oversees the central water project has yet to release its estimate. a pest carrying a fatal disease to citrus trees was found in california, triggering a 97 square mile quartentine. the bug is called an asian citrus psyllid, and has the potential to carry citrus greening, the disease that's wiping out a large portion of florida's orange crop, driving up prices. officials found the psyllid on a residential citrus tree in fresno. a herbicide containing 2-4-d is now in the middle of a court battle, but this time, it's e-p-a in the hot seat. this week, the ninth circuit court of appeals ruled
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dow's enist herbicide last fall. instead, the court says epa can review whether it was right in approving the herbicide, but can't just drop its decision on registering the herbicde. dow does expect enlist to be available for the upcoming growing season. a chinese national accused of stealing patented corn seed in iowa will avoid trial. the des moines register says mo hailong made a deal with federal prosectors. mo will plead guilty to one count of conspiracy to steal trade secrets. he was charged two years ago with being a part of a scheme to steal trade secrets from dupont-pioneer and monsanto. . mo was one of several people accused of digging-up seed from fields in iowa and illinois, the seed was then packaged, to be sent to a chinese-based seed company. that's it for news...meteorologist mike hoffman joins us now with a longer range look at the weather. mike. that's right, tyne. we are going to do the 90 day outlook today, since it is about the first of february. here's the way things will shape up for this week. look at that
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going to be a big weather maker and then it all turns very cold behind it with that big trough settling into the eastern two-thirds of the country. here's the 90 day outlook. we will go month by month here: february below normal temperatures, still for much of the southern tier of states, above normal up along the canadian border, what we are going to do over the spring time is shrink that below normal area by march into the southeast and most of the southern plains, but the great lakes northeast, northern plains, northwest above normal. by april, we shrink even more just in the texas and new mexico and some surrounding areas with above normal in the ohio valley, northeast, mid-atlantic, back through the northern plains, into the northwest, 90 day outlook for precipitation, still above normal, west coast, most of the southern tier of states, below normal for the northern great lakes and up along the canadian border, back into montana. tyne? each year, our partners at top producer magazine give out a highly coveted award in agriculture each year during the top porducer seminar: the top producer of the year. this
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and cheri de jong. we traveled to the dejong's this fall. and as you'll quickly see, it's their strong business sense and willingness to take a chance, that makes them elite. they often say leadership is a lonely pursuit.... but for donald and cheri de jong, this isn't the case. "donald is the dreamer. donald is the one that will make the deal. thinks that we can step over those boundaries. i am usually the one who says, okay, how are we going to pay for it, do it, operate." < i can't stand to sit there and read a 50 page legal document. i got add. it'll drive me nuts. and i'll miss stuff. she doesn't miss anything. it's balance in the office, on the farm and at home, that make the de jongs such a powerful combination. the two
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do a company. and then one of our large buyers is heb, a large grocer her in texas, and understanding and pealing back their hr program.> it's sort of a two way street, right, we want htem trained, so they do a good job for us, but we hope they're getting some benefit and value as well."> from good salary, wages and benefits, to offering hispanic workers the chance to learn english, the strategy is working. currently the de jongs employ 300 people, but donald sees that growing to 1,000 before his career is over. that's why immigration reform will play a major role. < the country is living in lala land and ignoring it. it will get solved and we have to figure out a way to have a humane way to have labor transfer across borders. > he's passionate about policy, and the family, with the next generation waiting in the wings. < i have three daughters that are currently in college right now we're hoping they come back to this operation. this is a family operations. it's not just myself and donald.> i would say they take after their mother very well. > and those strong traits are why donald isn't concerned about the next generation taking over the
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compromise. and i hope we got that into them. but then also not being pushovers and being strong enough to say and being aggressive and my girls are all very aggressive. > donald and cheri say they owe it to the girls to provide opporutnity, not results. but with smart business decisions and the drive to pursue their dreams, opportunity has turned into success. congratulations to the de jongs. you can see the other finalists by visiting top producer hyphen online dot com. when we come back, join phipps rejoins us. i'll take a look inside my mailbag this is machinery pete- invting you to check out my new website- machinerypete.com- offering farmears tens of thousands of used equipment listings to search. let machinery pete help you find and value your next piece of used equipment. >
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had more feedback than normal. so, today, john is giving us at his email inbox. john. i heard from viewers regarding terrorism risk. from john hubley in iowa: "i am a farmer in iowa. i tune in to watch farming news not to listen to john express his liberal political opinions. they are frankly offensive. he is quite arrogant to think anyone cares to hear his rambling opinions. if he doesn't stop i will stop watching and recommend to all my friends and family to do the same." from mariah roberts in syracuse, indiana: "just watched your commentary about terrorism. my husband and i both said, "finally!" someone that agrees with us! thank you for bringing those points to light in a factual, tactful way. we felt your response was
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aren't always present when this issue comes up in everyday conversation, unfortunately." from a viewer who requested anonymity: "i am oddly comforted by the demonstration that not everyone is as complacent and inattentive as you seem to be. neither will they, i suspect, be fooled by your absolutely absurd comparison with accidental firearm deaths. i admit to being a bit surprised in that you usually manage to sound much more reasonable. your assessment of the threat of mass destruction, which has already been historically validated, is truly laughable. but on a personal level, perhaps you are right. your greatest threat may be senility. i'm glad that at least you chose to acknowledge that viewer by name, and offer a mug." and from erin weir in kansas city, missouri: "thank you for your commentary on terrorism and gun control. it's so refreshing to hear people using critical thinking skills
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doesn't matter. what matters is that we engage in calm, rational, and fact-based discussions on issues. this is the best antidote for terrorism. the ability for us to have these discussions and listen to each other's opinions will give us the advantage over irrational zealots." welcome to my monday mornings. thanks, john. and he does read each of your emails. if you have a question or comment, you can email jn at mailbag at u-s farm report dot com.
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all my life on the back of a horse and that's the life i would be glad to endorse, except i've got a new baby and the kid is starting school and it is tough to pay bills riding colts and packing mules. and so we gave notice and moved into to town, but it is just for a while, till we get the down to buy place to run a few cows and a horse for the kid, because she ain't got one now and a place where my wife can look up the stars and hear crickets, coyotes, not a chorus of cars. maybe i'm dreaming, dreaming is ok to help on old cowboy get through the day--it gives the old brain some time to unwind. knowing tomorrow it is back to the grind and i bet my old dog
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elsewhere tonight, but for the time being our dreams have to wait, because reality comes every morning at 8. he used to break horses, he used to herd sheep and he worked in a feedlot awhile and he grew up with the dream of buying a ranch and raise horses and cattle in style. but time pulled a fast one, life took a turn, dreams pulled the wool over his eyes, because it takes more than wishing and working all day to buy a ranch and survive, so now he sells saddles or vaccine or seed or writes for the livestock gazette, doing whatever it takes to stay close to the land he will never get. and ag economics or ranch real estate and his hat, boots and gloves,
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that he wishes he was, but he knows he is lucky to have a job that lets him stay close to his roots. he may never own the ranch of his dreams, but at least he can pay for his boots. this is baxter black from out there. thanks, baxter. and you can hear more from baxter by visiting baxter black dot com. whn we come back, it's tractor tales and our country church salute..
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this is the only john deere that i have. i just got this back after i bought it three years ago. i had some difficulty getting it running and friends of mine helped me out and finally got it there, so i had a ball driving this thing this morning and hoped to come back when the rain stopped and play around with it some more. i do what i call slowing life down to five mph and that's where the antique tractors really are therapeutic for me. i love driving around my small town in massachusetts here and visiting people and going to antique shops and going to the local restaurants and just drive up in my tractor and enjoy it and it's a good way to spend a sunday morning. this one is one hundred percent running... the hitch, hydraulics need a little work. we got to play around with those
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while before i take it all apart and restore it. it will be on the list of things to do, but it is a long list. it came from northern massachusetts, a guy i know who is a scrapper brought it to me like he brings most of the tractors that he gets first, so i get to look at them first before he scraps him, i save them from the scrap pile and i am so glad that i did, because somebody paid a t of attention into this--there's a lot of stainless steel bolts on this that would never seize on them. somebody really put some thought and care into this machine and i saw that immediately and this was worth saving and i am glad that i did. it is definitely going to be fun. thanks, al. this week, we have a very special church from the northwest, the st. andrews episcopal church of chelan, washington. the unique church has a striking interior, as it's made entirely of logs. to transport the logs, they had to float them down lake chelan in the late 1890s. the church is over 110 years old and listed in the national historical registry. thanks so much for sending that in. if you have a
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black- white face cow. and there's plenty of powder in pure michigan. greg shooks says his cherry trees are sleeping in peace this winter. greg is in torch lake, oh it's pretty, a gorgeous arrea. we have some friends up there it is beautiful. but it's been mil this winter. yeah, they've had a decent amount of snow though. they always do. so, this next system that we see this week, i saw forecasts that it could go all the way up through michigan. what are you thinking . until it comes out of hte rockies we don't knwo the exact track yet. it's always the case. the storms come across the rockies get kind of mixded up and messed up in there i would say so the exact track we can't tell but osmeone is going to get buried out of this sotrm and some are going to get a couple inches of rain, as well. some of those folsk need it htanks so much mike. as always, we want to hear from you, send comments to mailbag-at-u-s-farm-report-dot- com or check us out on facebook and twitter. for all of us at u-s farm report, i'm tyne morgan. thank you for watching u-s farm report. be sure to join us right here again next week, as we work to build on our
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the official news gathering vehicle for farm journal television ator) on today's special paid presentation for cindy crawford's new meaningful beauty ultra, brought to you by guthy-renker, you'll discover the secrets to not only aging gracefully, but beautifully while looking your absolute best every step of the way. i think my philosophy on aging is really more my philosophy on living, which is just do it well, take care of yourself. it's about celebrating where you are and being the best you that you can be in that moment. then it's not aging, you're just livi. (female narrator) in the next few minutes,
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