October 25, 2014

EPA Approves Dow’s Enlist Duo Herbicide

EPA registration of Dow’s Enlist Duo Herbicide was announced Wednesday. The pesticide is for use in controlling weeds in corn and soybeans genetically-engineered to tolerate 2,4-D and glyphosate. This approval follows USDA’s September approval of corn and soybean varieties designed to tolerate the herbicide. The decision posted to the regulatory docket states that the decision reflected “a large body of science and an understanding of the risk of pesticides.” Noting that the herbicide met standards necessary to protect public health, the EPA further noted that it used “highly conservative” assumptions in its risk evaluation. EPA is registering the pesticide in six states; Illinois Indiana, Iowa, South Dakota and Wisconsin. The agency is accepting comments until Nov. 14, on whether to register Enlist Duo in ten more states; Arkansas, Kansas, Louisiana, Minnesota, Missouri, Mississippi Nebraska, Oklahoma, Tennessee and North Dakota

The American Soybean Association along with the National Corn Grower Association welcomes the registration of Enlist Duo Herbicide. Both groups released statement supporting the registration. ASA President and Iowa farmer Ray Gaesser stated “we now look to our key export partners to approve this trait.” ASA called upon foreign markets where U.S. soybeans are exported to quickly review and approve these new biotech events so that they can be commercialized here in the United States without jeopardizing export markets and U.S. farmers can realize their benefit. NCGA member and Ohio grower John Linder said “This final step should place a necessary, new tool in the hands of corn and soybean farmers in immediate need of new systems to combat growing weed pressures.”


Report Says Agriculture Is Becoming Burden In China

According to a report in the New York Times, agriculture is becoming a burden for China. The article states many farmers have migrated to cities after becoming frustrated by how little they earn. Farm output in China remains high but they point to rural living standards that have failed to keep up with the pace of the nation’s cities. The most recent figures show a threefold gap between urban and rural incomes, fueling discontent and helping to make China one of the most unequal societies in the world. Farmers do not own their land in China, according the report. It begins with the fact that farms in China are too small to generate large profits, about 1.6 acres on average, compared with 400 acres in the United States.

The nation’s Communist leaders have declared that fixing the countryside is crucial to maintaining social stability. Last year, they unveiled a new blueprint for economic reform with agricultural policy as a centerpiece. Privatizing farmland would allow market forces to create bigger farms. The report also outlines that because farmers do not own their land, very few can get a loan to pay to rent others land.


USDA’s Monthly Reports Mostly Neutral to Grains

USDA predicts a record production of corn and soybeans from this fall’s harvest, according to the latest round of crop reports. USDA released the monthly Crop Production and World Agriculture Supply and Demand reports on Friday. USDA suggests farmers will bring in a corn harvest of 14.5 billion bushels and a soybean harvest of 3.9 billion bushels. Overall, the numbers were very close to traders expectations.


USDA pegged corn production for the year at 14.5 billion bushels, which would be a record sized corn crop. The national average corn yield was reported at 174.2 bushels per acre. That’s up 2.5 bushels from last month’s estimate. USDA estimates harvested acres of corn at 83.1 million.

USDA boosted ending stocks to 1.236 billion bushels on a 55 million bushel increase while globally, ending stocks came in at 190.6 million metric tons. The ending stocks-to-use ratio was estimated at 9.1 percent. New crop ending stocks were increased to 2.08 billion bushels with a stocks-to-use ratio of 15.2 percent.


Estimated soybean production was pegged at a record 3.9 billion bushels with 47.1 bushels per acre average. Farmers are expected to harvest 83.4 million acres of soybeans this year, according to USDA.

USDA made several adjustments to 2013-14 soybean supply and demand to arrive at its ending stocks figure of 92 million bushels. The ending stocks-to-use ratio dropped to 2.6 percent. On new crop, USDA lowered its beginning stocks figure by 38 million bushels and increased production by 14 million bushels from last month, resulting in a 24 million bushels decline in total supplies. USDA made no changes to demand, resulting in an ending stocks estimate of 450 million bushels. Globally, USDA sees 2014-15 ending stocks at 90.7 million metric tons.


Wheat ending stocks were lowered to 654 million bushels USDA increased production by 5
million and upped residual use and export by 25 million bushels each. The ending stocks-to-use ratio came in at 30.5%. Globally, USDA trimmed its ending stocks estimate by 3.9 million metric tons t to 192.6.  Final production data was addressed in the Small Grain Summary on September 30, although USDA did note they will resurvey Hard Red Spring producers in November due to the late harvest this year.  Any revisions will be made in the January Final Crop Production report for 2014


U.S. oilseed production for 2014/15 is projected at 116.3 million tons, up 0.1 million from last month. Canola, sunflower, and cottonseed production are forecast lower this month while peanut production is forecast slightly higher.


The forecasts for total meat production in 2014 and 2015 are raised from last month. For both 2014 and 2015, the increase in beef production is driven by heavier carcass weights as lower corn prices encourage producers to market heavier cattle. Pork production in 2014 is reduced.

Growth Energy calls last week’s WASDE report by USDA the signature at the end of the food versus fuel myth. If the report is accurate, the U.S. corn crop is going to break last year’s record production by a substantial amount.  With corn stocks predicted at the highest level since 2004, they are likely to pressure corn and other cereal prices well into the future. Corn used to produce ethanol, distiller’s grains and other co-products is projected at 5.125 billion bushels, while corn consumption for feed is estimated at 5.375 billion bushels. Globally, the Food and Agriculture Organization of the U.N. has reported that its international food price index is down 6.0 percent over the last year. The FAO noted that grain prices were down nearly nine percent since 2013, while meat prices are nearly 22 percent higher than a year ago. Growth Energy CEO Tom Buis stated “We see that the American farmer can produce an abundant amount of food and fuel. It is clear that the food and fuel myth is completely unfounded and does a great disservice to the hardworking men and women that help feed the world and fuel our nation.”