July 28, 2015

U.S. Cattle Herd Expansion Underway, According to USDA

cattleThe Semi Annual Cattle Inventory Survey was released by USDA on Friday, and for those who still questioned whether the U.S. Cow herd is growing, they got some answers. USDA Livestock Analyst Shayle Shagam:

Shagam 1

Importantly, note industry analysts, the rate of heifer retention is high. In fact, the number of heifers placed into feedlots in relation to the number of steers is the lowest on record:

Shagam 2

In the Cattle on Feed report, which is issued separately from the semi annual inventory numbers, The slow pace of marketing in June finally caught up:

Shagam 3

Shagam noted the expansion is just getting started and with big margins over the past few years and the elimination of drought in the Plains states, he expects herd expansion will only increase from here.

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‘Ham and Cheese’ Heads to Voters

milk cow production“Ham and Cheese” will be on the menu for voters in North Dakota next year as they determine the fate of recently passed legislation that exempts dairy and swine operations from North Dakota’s anti-corporate farming laws.

Senate Bill 2351 – referred to as “the ham and cheese bill” by some folks during debate — allows a nonfamily corporation or limited liability company to own a dairy or swine facility with at least 50 cows or 500 swine on up to 640 acres.

Signed by North Dakota Governor Jack Dalrymple in March, S.B. 2351 was set to become effective August 1st.

However, the Secretary of State’s office verified earlier this week that petitions submitted by opponents to the measure had enough valid signatures to put it on the June 2016 ballot. Now, state residents will decide whether to keep the law or repeal it in a referendum vote next summer.

State Senator Joe Miller, a republican from Park River, is acting as a temporary coordinator for a coalition that supports the law – called “Yes for Dairy and Pork Producers.”

Supporters Rally

Supporters argue the exemption makes North Dakota more attractive to dairies looking to relocate from other states – such as drought-stricken California.

Attracting Biz

Opponents of the ‘ham and cheese’ bill argue it will allow big, out-of-state corporations to set up operations in the state at the expense of smaller family farmers. Miller disagrees.

Opposition

North Dakota’s anti-corporate farming law dates  back to the 1930’s. Several other states have laws restricting corporate farming, though many allow exemptions for certain types of livestock operations, including Minnesota and South Dakota.

South Dakota Governor Dennis Daugaard says his state has seen the success of attracting new dairy business to the area.

South Dakota

The Dakotas have ample forage and water to attract interest from potential new dairy ventures in the region, but Miller argues that the business climate needs to catch up in his state.

New Tools

Miller says members of Yes for Dairy and Pork Producers will begin raising money in defense of S.B. 2351.

Defense Fund

Reports indicate that the North Dakota Farmers Union, which is opposed to the law, spent about $41,000 dollars on the effort to bring the measure to a referendum vote.

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Improved Weather Stabilizes Crop Conditions In U.S.

Grain markets have taken a break from the recent run higher this week and analysts say it’s because of improved weather. It looks like the trend of crop friendly conditions will continue, according to USDA meteorologist Brad Rippey:

Rippey 1

The break in the weather may be temporary, Rippey says to expect changes:

Rippey 2

USDA Crop Conditions data on Monday showed unchanged ratings for both corn and soybeans at 69% and 62% good to excellent respectively.  Several private firms noted that their individual yield models increased slightly as the seasonal tendency is for corn conditions to decline in July.  Hard Red Spring conditions fell by 1%, as expected.

Weather is developing into an issue for the Canadian wheat crop. On Tuesday, Ag Canada projected this year’s wheat crop at 27.1 million metric tons, down a whopping 2.5 million tons from the month before. The agency cited dry conditions in the prairie provinces as the primary motive for the decline, also adding that they were open to further reductions if the weather doesn’t change. Canola production was projected at 14.1 million metric tons, down 8.1 percent on the year. Bruce Burnett, a trader with Winnipeg based CWB noted that their private projections are closer to 24 mmt on wheat and 12.1 mmt of canola.

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