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Serving: United States

USDA Aims to Import More Canadian Beef

USDA sent a plan to the White House Friday for increasing the amount of beef the U.S. imports from Canada.

Previous attempts to expand cattle and beef imports from Canada stalled due to concerns about the effectiveness of Canada's safeguards against bovine spongiform encephalopathy, also called 'mad cow disease.'

Authorities have been weighing the issue of importing older cattle, which have a higher risk of carrying BSE. Although both the U.S. and Canada have taken steps to make sure diseased cattle tissue does not contaminate cattle feed - the only known way for cattle to contract BSE - Canada found an infected cow this summer that had been born five years after the ban on cattle remains in cattle feed.

The U.S. imports about 12% of its beef, with about a quarter of beef imports coming from Canada.

AWB Likely to Face U.S. Congressional Probe

AWB, the Australian wheat company found to have paid nearly $300 million in bribes to Saddam Hussein's regime, will likely face U.S. action. Senators Tom Harkin, D-Iowa, and Norm Coleman, R-Minn., have promised to further investigate AWB, and Ag Secretary Mike Johanns says the USDA will proceed to bar AWB from participating in USDA export credit programs.

"While I understand that the Government of Australia intends to pursue criminal proceedings in this case, I have directed that USDA resume the debarment process," Johanns says.

An Australian panel, lead by former Supreme Court Justice Terence Cole, found that AWB paid Saddam Hussein's government $290 in bribes and kickbacks while both the Iraqi government and AWB used the U.N. oil-for-food program for their own profit between 1999 and 2003.

AWB agreed not to participate in the USDA credit export program in November 2005 during the Government of Australia's investigation.

The U.S. wheat lobby expects AWB to face a congressional probe into whether or not its actions violated American laws. The lobby has criticized AWB's monopoly on Australian wheat exports and, along with Cole, point to the monopoly as part of the problem.

"We view the monopoly as a source of this problem, of the culture that developed at AWB that led to these illegal actions," USWA president Alan Tracy says.

Pork and Corn Industries Talk About Distillers Grains

Members of corn and pork groups discussed a potential relationship between their industries through byproducts of ethanol production as hog feed at a Nov. 20 seminar in Des Moines, Iowa, titled "Distillers Grains: Implications for the U.S. Pork Industry."

"The real mission of the meeting was to explore the research needed to help the pork industry move forward with distillers grains," says Don Hutchens, executive director of the Nebraska Corn Board.

The session focused on research dealing with distillers dried grains with solubles as feed for hogs, as well as the economic impacts of DDGS and ethanol production on feed prices.

According to the National Corn Growers Association, DDGS can reduce gut health problems and possibly increase litter size weaned and piglet growth rate, but much of the pork industry's concern about the growth of the ethanol industry deals with economics and rising feed prices. NCGA suggests that DDGS could provide a cheap feed alternative for pork producers.

"A couple of speakers pointed out corn yield improvements can help address much of the needed additional corn supply required to satisfy ethanol and livestock production," Hutchens says. "I felt it was a meeting that helped open doors of better communication and forward thinking to make sure we all understand the issues around the new paradigm of corn-to-ethanol with a coproduct that can be better utilized in swine rations with some changes in processing and application."

Corn+Soybean Digest

Johanns Announces Soybean Board Appointments

Johanns Announces Soybean Board Appointments

Secretary of Agriculture Mike Johanns has announced 15 appointments, 1 interim appointment, and 1 alternate appointment to the United Soybean Board (USB). All appointees will serve 3-year terms beginning December 2006. The interim appointee will serve a 1-year term.

Appointed members representing soybean producers by state are: James H. Carroll III, Arkansas; Mark L. Detweiler, Georgia; Kenneth L. Dalenberg, Illinois; Karen L. Fear, Indiana; Laura L. Foell, Iowa; Benny F. Cooper, Kentucky; Ike P. Boudreaux, Louisiana; James A. Call, Minnesota; Terry L. Ecker, Missouri; Loyd L. Pointer, Nebraska; Floyd L. Peed, North Carolina; Vanessa A. Kummer, North Dakota; Thomas F. Brown, Ohio; Michael H. Gerhart, Pennsylvania; George L. Christensen, South Dakota; and Robert B. Johnson, Virginia.

Robert N. Haselwood, Kansas, was appointed to serve the remainder of a term vacated by resignation.

Keith M. Dunn, Virginia, was appointed as an alternate member.

The 64-member Board is authorized by the Soybean Promotion, Research and Consumer Information Act. USDA selected the appointees from soybean producers nominated by Qualified State Soybean Boards. The mandatory program is funded at the rate of one-half of 1% of the net market price of soybeans purchased.

USDA's Agricultural Marketing Service monitors operation of the Board.
Corn+Soybean Digest

The Road Warrior Of Agriculture

Viva Las Vegas!

I just finished my 29th consecutive American Bankers Association Agricultural Bankers Conference in Las Vegas, NV. This year’s conference had over 600 in attendance, from 32 states, Canada, Australia, Nepal and the Republic of Georgia.

Yes, I had my picture taken with Elvis, got to hear a Bill Clinton impersonator, just missed the Rolling Stones and, no, I didn’t lose any money on the tables or slot machines. Beyond that, as with any of the ABA’s well-organized, information-packed conferences, there was much food for thought.

The following are some thoughts and perspectives.

Flu Outbreak
· A major avian flu or pandemic flu outbreak would cost America 12% of its GDP and impact 142 million people.
· If a major flu broke out, quarantine, social isolation, social distancing and time would be the cures.
· Just-in-time inventory systems for food and energy could create major shortages throughout the world during a pandemic flu outbreak.

View From Down Under
· The Australian bankers indicate they have been in drought for nearly half a decade.
· Land values have doubled because of off farm investment. Does this sound familiar?
· Farms with debt are outperforming those that are debt free because of focus, accountability to third parties and proactive management.
· Australia has 131,000 farms and ranches, employing 670,000 people, which is 6% of the total Australian economy.
· The country’s largest enterprises in descending order are beef, wheat, dairy, wool sheep, wine, cotton and sugar.
· Margin compression and farm and ranch business transition are some of the biggest issues
· Australia and New Zealand eliminated government supports for agriculture overnight, which eliminated 17% of farm numbers.
· The Australians have a very successful program in farm management, which consists of pre-tax deposits that producers can build up in good years and draw upon to supplement their income and meet costs in low-income years. This sounds like an idea that is long overdue in the next U.S. Farm Bill.

Next time: More from Vegas.

Editor’s note: Dave Kohl, The Corn And Soybean Digest Trends Editor, is an ag economist specializing in business management and ag finance. He recently retired from Virginia Tech, but continues to conduct applied research and travel extensively in the U.S. and Canada, teaching ag and banking seminars and speaking to producer and agribusiness groups. He can be reached at sullylab@vt.edu

Corn+Soybean Digest

Focus On Agriculture

Many Proposals For The Next Farm Bill
USDA gathered input from agriculture producers and others at a series of Farm Bill Listening Sessions in 2005 and early 2006. The input gathered at these Listening Sessions was used by USDA to develop a series of analytical theme papers, which were intended to be used as support information to help guide the decisions related to the development of the next Farm Bill.

The five USDA 2007 Farm Bill Theme Papers focus on the following:
1. Risk Management (Commodity Programs and Crop Insurance)
2. Conservation and Environment (CRP, EQIP, WRP, CSP, etc.)
3. Energy and Agriculture (Renewable Energy, etc.)
4. Rural Development Programs
5. Strengthening The Foundation For Future Growth In U.S. Agriculture (World Trade, New Markets, Food Safety, Biosecurity, Human Nutrition, etc.)

A Farm Bill covers all USDA Programs, which is quite comprehensive, and affects a significant percentage of the U.S. population. All of the USDA 2007 Farm Bill Theme Papers, and other information relative to the development of a new Farm Bill, are available through connections with the USDA web site at: www.usda.gov

Kent Thiesse, Vice President at MinnStar Bank and Government Farm Program Analyst, has prepared a series of four articles that focus on some of the ideas for provisions in a new Farm Bill that would relate to the programs that directly impact farm operators. The articles also include some of the background and history of farm commodity programs. To receive a free copy of the articles related to development of the next Farm Bill, please contact Kent by phone at (507) 726-2137, or by e-mail at: kent.thiesse@minnstarbank.com


Next Steps In The New Farm Bill

WTO trade agreements and the growing federal budget deficit are likely to weigh heavily on any changes or considerations related to DCP direct or counter-cyclical payments (CCPs), CCC marketing loans or LDPs and Federal Crop Insurance. Most likely there will be some type of direct payment, and some form of CCC commodity loans in the next Farm Bill. However, the future of CCPs and LDPs is far less certain, and could be replaced with some type of revenue-based commodity program. It’s less likely that we will see policies that would give the federal government extended control of grain inventories, such as longer CCC loan periods, or re-authorization of a grain reserve, unless it’s somehow targeted as a strategic energy grain reserve, or something similar. Many farm groups and congressional leaders are calling for some type of permanent crop and livestock disaster legislation to be included in the next Farm Bill. There seems to be very strong support in Congress, and by the public, including many farm operators, to reduce payment limits and to tighten-up so-called payment limit loopholes. The biggest challenge is arriving at payment limits that are fair and equitable for all producers throughout the U.S., and that treat all commodities equitably.

The CRP program is popular and will continue; however, CRP acreage caps are not likely to increase, unless those added CRP acres are somehow linked to producing plant material for renewable energy production. Expansion of the Conservation Security Program (CSP), and other conservation and environmental program provisions will likely get considerable discussion during the Farm Bill debate, however, this will largely depend the level of funding provided by Congress for CSP and other green payments.Some groups would like to see a minimum level of CSP as a farm program requirement.

There will be a lot of discussion regarding the new Farm Bill in the coming months, as the new Congress organizes in 2007. The key to getting a new Farm Bill completed in 2007 will be to what degree members of Congress and USDA can reach compromise on keeping, changing or adding various provisions.

You can contact him at 507-726-2137 or via e-mail at kent.thiesse@minnstarbank.com.

Editor’s note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN.

Corn+Soybean Digest

Market News

South American soybean producers continued to make good progress planting their 2006-07 crops last week as weather conditions remained mostly favorable.

Private analyst Safras & Mercado pegged Brazilian planting progress at 77% as of Nov. 24, up from 63% a week earlier and ahead of the five-year average of 74%.

Another private Brazilian consulting firm, AgRural, estimated that 84% of Brazil’s soybean crop had been planted as of Friday, up from 70% a week earlier.

Safras pegged planting progress in Brazil’s top soy producing state of Mato Grosso at 91%, ahead of an average of 81%, while AgRural estimated that 99% of the Mato Grosso crop was already in the ground.

Wet conditions have slowed planting progress somewhat in Brazil’s southernmost producing state of Rio Grande do Sul, but producers there had still managed to plant 58% of their crop, vs. a normal pace of 65%, according to Safras.

In Argentina, soybean planting continued to advance at a good pace last week, although progress was estimated to be slightly behind a year earlier as of Friday. Argentina’s government pegged planting progress as of Nov. 24 at 53%, while the Buenos Aires Cereals Exchange pegged progress at just below 56%.

The government reported producers in Argentina’s top soy province of Cordoba made steady planting progress thanks to sufficient soil moisture.

"The crops are generally emerging well (and) with respect to their health, no serious problems have been registered," the agriculture secretariat said in its weekly crop update.

The cereals exchange, however, reported some planting delays due to a lack of moisture in the north of Cordoba.

The government said that hail storms had forced some replanting of soy fields in the second-largest producing province of Santa Fe. In No. 3 grower, Buenos Aires province, sowing is well advanced, although renewed soil dryness has slowed progress in central and southern districts.

Editor’s note: Richard Brock, The Corn And Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

To see more market perspectives, visit Brock's Web site at www.brockreport.com.

New Herbicide-tolerant Soybeans Set for 2009

A next-generation herbicide tolerant soybean trait could be ready for commercialization in 2009. DuPont completed regulatory submissions for approval of its Optimum trait Tuesday, a step towards its goal of 2009 commercialization.

"This is a significant step for DuPont," said Erik Fyrwald, DuPont group vice president, Agriculture & Nutrition. "These regulatory submissions keep us on track for commercialization of products starting in 2009 and allow us to meet farmer demand for better performing products with new weed control options."

DuPont submitted regulatory information to the USDA, EPA, and FDA this fall.

Each year, farmers treat 90% of U.S. soybean acres with glyphosate. The new trait would give growers another choice in glyphosate-tolerant soybean seed aimed at maximizing yield potential, improving crop safety and expanding weed control options.

Arizona Farm Bureau: Yuma farmer wins annual award

Gary C. Oden of Yuma received this year’s Farmer of the Year Award which was announced as the Arizona Farm Bureau’s 85th Annual Convention, held Nov.9-10 at the Crowne Plaza in Phoenix.

Oden is owner and chairman of the board that operates McElhaney Cattle Company in Wellton. McElhaney Cattle Company was founded by Sam McElhaney in 1940 and was taken over by son-in-law Oden in 1973 where he continues to build and expand the venture.

Today, the McElhaney Cattle Company operation can unload 100 train cars of grain in less than 15 hours, produce 120 tons of mixed feed per hour and deliver it to 130,000 head of cattle.

In 1985, Oden bought Sunland Beef in Tolleson. He and other producers formed to construct a new state-of-the art slaughter facility in Brawley. It has now merged with National Beef, the fourth largest beef processing company in the U.S. giving Arizona beef producers more markets for their product.

The Farmer of the Year represents the OSCAR of Farm Bureau. It represents an individual that is innovative and a trendsetter in Arizona’s agriculture community.

Cline: Central SJV is real California ‘wine country’

California is a different place. Taxes are too high. Roads are too busy. Politics are stranger than fiction (former governor and Oakland mayor Jerry Brown is California’s new attorney general?). No other state in the nation has a more diverse culture or a former body builder for governor who was just re-elected by a massive margin over a career politician.

As weird as it may be, many people want to visit our state. After all, there is Disneyland, San Francisco, Monterey, Big Sur, Hearst Castle, the Golden Gate Bridge, the Sierra Nevada and the list goes on.

Another place they often want to visit is “the wine country.”

My standard response is “Modesto, Madera or Fresno?” The response is always “huh?” I know they mean California’s North Coast. I just string them along.

Then I tell them 60 percent of California’s wine grapes are produced from Modesto to Bakersfield. If the wine label says California, there is a good chance some of its content was grown in the Central San Joaquin Valley.

Next time someone tells you they want to visit “wine country,” tell your friends, forget Napa: Visit Fresno, the true heart of California wine country.

OK, there is no Mondavi in Fresno, Coppola in Madera or former Christian Brothers Greystone Winery in Tulare.

But the Central Valley does produce good wine as evidenced by the more than 2,000 people who turned out recently for Fall Wine Cornucopia 2006 at the new baseball stadium in downtown Fresno.

More than 45 wineries poured their best; some of it award winning, at the event organized by Central California Winegrowers (CCW) in partnership with the Guilds of Children’s Hospital of Central California. The function was a fundraiser for the children’s hospital in Madera. It was the second wine cornucopia put on by the CCW, an organization of mostly producers who want to promote Central Valley wine and encourage growers to produce quality wine grapes.

“We invited people from all over the Valley to discover, sample, and enjoy the Cornucopia of wines and delicacies produced in our own backyard,” CCW event chairperson Peterangelo Vallis said.

I missed the first one, but not the 2006 event. Frankly, I was overwhelmed at the wine quality produced by local Central Valley wineries. And certainly more than 2,000 other local folks were impressed as well. It was a great event.

I am no wine aficionado. I have my favorite varietals. I get lost in all the labels. I really enjoy tasting all wines.

The next time shirttail relatives call and says they want to hang out at your place and visit California “wine country,” tell them you’d be glad take them tasting to the wineries of Central California.

Start with the Madera Wine Trail (www.maderavintners.com) and tell your friends that the wine history of Madera County and the Central San Joaquin Valley goes back to the mid 1800s when settlers from Armenia, France, Spain, Italy and other countries homesteaded small family farms and planted grapes to make wine traditional to their homelands.

A tip of the cap to CCW for stepping up to promote the real California wine country.

e-mail: hcline@farmpress.com