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DTN Early Word Grains 07/24 05:56

DTN Early Word Grains 07/24 05:56 Burned December corn was 7 cents lower, November soybeans were 20 cents lower, and September Minneapolis (HRS) wheat was 9 cents lower. By Darin Newsom DTN Senior Analyst 6:00 a.m. CME Globex: December corn was 7 cents lower, November soybeans were 20 cents lower, and September Minneapolis (HRS) wheat was 9 cents lower. CME Globex Recap: Grains and oilseeds posted solid sell-offs overnight with November soybeans losing as much as 23 cents during the session. This despite another generally dry weekend for much of the U.S. Midwest, with the only change in weather rains seen last Friday and subsequent "cooler" temperatures. Outside commodities were generally lower as well with only gold, silver, and cocoa showing gains. DJIA futures were also down, while the U.S. dollar index posted a small rally. OUTSIDE MARKETS: The Dow Jones Industrial Average closed 31.71 points (0.2%) lower at 21,580.07, the NASDAQ Composite lost 2.25 points to 6,387.75, and the S&P 500 slipped 0.91 point to 2,472.54 Friday. DJIA futures were 27 points lower early Monday morning. Asian markets closed mostly higher with Japan's Nikkei down 124.08 points (0.6%), Hong Kong's Hang Seng gaining 140.74 points (0.5%), and China's Shanghai Composite up 12.62 points (0.4%). European markets were trading lower with London's FTSE 100 losing 78.07 points (1.0%), Germany's DAX down 80.46 points (0.7%), and France's CAC 40 falling 17.47 points (0.3%). The U.S. dollar index gained 0.03 to 93.89. September 30-year T-Bonds were 2/32 lower at 154'23 while August gold gained $2.40 to $1,257.30. Crude oil was $0.05 lower at $45.77 while Brent crude dipped $0.03 to $48.03. China's Dalian soybean and Malaysian palm oil futures were both lower overnight.

DTN Early Word Opening Livestock 07/24 06:03

DTN Early Word Opening Livestock 07/24 06:03 Cattle Futures to Face Pressure on Opening Thanks to Bearish on Feed News Live and feeder futures are set to open significantly lower, pressured by larger than expected June placement and larger July 1 feeder cattle supplies. Lean hog contracts seem staged to begin at least moderately lower, checked by slowly shifting fundamentals. By John Harrington DTN Livestock Analyst Cattle: Steady Futures: 100-200 LR Live Equiv $138.89 - .41* Hogs: $1 LR Futures: 50-100 LR Lean Equiv $108.35 -1.16** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Cattle-feeding country will be typically quiet Monday as buyers and sellers focus exclusively on the distribution of new showlists. We expect the last month's offering to be somewhat larger than last week. Live and feeder futures should open significantly lower, primarily pressured by the larger than expected June placement confirmed by Friday's on feed report.

DTN Midday Grain Comments 07/24 11:31

DTN Midday Grain Comments 07/24 11:31 Beans, Wheat Lower at Midday Trade is lower across the board at midday led by spring wheat. Cooler-to-normal conditions outlooks have eased weather concerns. By David Fiala DTN Contributing Analyst General Comments The U.S. stock market indices are lower with the Dow futures down 70 points. The interest rate products are lower. The dollar index is 15 higher. Energies are mixed with crude up 0.60. Livestock trade has cattle limit lower, and hogs modestly lower. Precious metals are higher with gold up $1.40. CORN Corn trade is near the daily highs at midday, but sitting 4 to 5 cents lower at midday. A 4 cent gap was left with initial pressure last night and we were down around 9 cents. The weekly export inspections were decent at 935,262 metric tons which limited downside. The USDA announced 135,000 metric tons of corn sold to unknown for new crop this a.m. Cooler near-term forecasts and some rains over the weekend were noted for the gap lower open. Corn pollination will continue with cooler temperatures after the next couple of days but rain coverage remains less than ideal for the much western belt. There are spots of excessive moisture in areas of the east. Ethanol production margins are benefited from the decline in corn. The weekly crop progress report is expected to show steady to slightly lower conditions, with maturity near normal. On the December chart support is at the July low of $3.81 3/4 with resistance at the 100-day at $3.90 then the 20-day at $3.94. SOYBEANS Soybean trade is 14 cents lower at midday after trading nearly 25 cents lower overnight. Meal is $4.50 lower and soybean oil is down 25 points. Cooler temperatures with some moisture was viewed as less threatening for the coming weeks; this had beans lower but there was no big interest in selling new crop beans below $10. We still have six important weeks of weather ahead for beans. The western belt will likely see the most stress going into August with rains limited. Market bears hope for more Gulf moisture to make its way into the western belt and High Plains. The weekly crop progress report is expected to show a slight decline in conditions with maturity remaining slightly ahead of normal. The weekly export inspections were okay at 596,620 metric tons. China is expected to remain active in securing fall supplies on breaks. On the November chart support is at the 20-day at 9.89 with resistance at the 10-day at 10.13. WHEAT Wheat trade is around 10-12 cents lower on Kansas City and Chicago with Minneapolis down 30 cents. Minneapolis has been down over 40 cents with corrective action still occurring following the $3 rally from mid-May to early this month. The spread trade remains active with Minneapolis still $2.50 over Chicago. The September spread was trading around $1 over in early May, then traded to nearly $3 over on July 5. The weekly export inspections were ok at 451,665 metric tons. Most world export business remains focused on the Black Sea area as harvest begins to progress there, with the dollar around the yearly lows there is hope for export U.S. improvement but world supplies remain ample. Australia continues to see dryness raising a production concern in addition to the spring wheat issues here. The Spring wheat tour will go out this week, which should provide further guidance with trade acting as if much of the issues are priced-in. The weekly crop progress should show winter wheat harvest past 85%, with spring wheat conditions steady to slightly lower, and maturity ahead of normal. On the December Kansas City contract support is the 50-day at $5.10, then the 100-day at $4.94. Resistance is at the 10-day at $5.39 then the 20-day at $5.44. David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered Advisor. He can be reached at dfiala@futuresone.com Follow him on Twitter @davidfiala (BAS) Copyright 2017 DTN/The Progressive Farmer. All rights reserved.

DTN Midday Livestock Comments 07/24 12:31

DTN Midday Livestock Comments 07/24 12:31 Limit Losses Develop in Cattle Futures Sharp losses flood through cattle trade as limit losses are seen in live cattle and feeder cattle futures. The bearish tone of the cattle on feed report has created additional pressure on the entire complex. By Rick Kment DTN Analyst GENERAL COMMENTS: Limit losses have developed in cattle trade Monday morning in reaction to the bearish cattle on feed report seen Friday. This pushed live cattle futures $3 per cwt lower in several contracts, while most feeder cattle markets are posting $4.50 per cwt losses. Corn prices are lower in light trade. September corn futures are 4 cents lower. Stock markets are mixed in light trade. The Dow Jones is 50 points lower while Nasdaq is up 10 points. LIVE CATTLE: Limit losses are seen in October and December contracts have allowed markets to create additional market pressure through live cattle futures. There continues to be a bearish undertone across the entire cattle market as traders focus on the sharp losses in feeder cattle trade as well as general pressure in the live cattle complex. This could significantly weaken fundamentals even though technical factors have not been impacted at this point. Cash cattle remain quiet with bids and asking prices undefined at this point in the week. Show lists appear to be overall larger across the country with Texas the only area with smaller offerings early in the week. It is likely going to be midweek before active bids develop given the defensiveness of futures trade. Beef cut-outs at midday are higher, $2.77 higher (select) and up $0.53 per cwt (choice) with light movement of 41 total loads reported (23 loads of choice cuts, 10 loads of select cuts, no loads of trimmings, 8 loads of ground beef). Feeder Cattle: Limit losses have quickly developed across feeder cattle futures as traders have focused on the bearish news in the July 1 cattle on feed report. The increased placement numbers seen during June has added to the concerns through the entire complex. This has weakened the entire cattle market and could set the tone for the entire week. LEAN HOGS: Triple-digit losses have moved through nearby lean hog futures trade with October through April lean hog futures posting losses of $1 to $1.25 per cwt as spillover pressure is seen from the weakness in the cattle futures. August futures remain under pressure with prices hovering above $80 per cwt with 95-cent-per-cwt losses. The continued pressure in cash trade continues to add to the lack of support in the lean hog complex. This may add even more softness to the market through the near future as traders try to bring some underlying stability to the market in the next couple of weeks. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.19 at $82.13 per cwt with the range from $77.00 to $83.25 on 4,944 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price fell $0.71 at $82.86 per cwt with the range from $77.00 to $83.00 on 2,015 head reported sold. The National Pork Plant Report reported 101 loads selling with prices falling $0.67 per cwt. Lean hog index for 7/20 is at $91.67 down $0.33 with a projected two-day index of $91.13, down $0.54. Rick Kment can be reached at rick.kment@dtn.com (BE) Copyright 2017 DTN/The Progressive Farmer. All rights reserved.

DTN Closing Grain Comments 07/24 13:56

DTN Closing Grain Comments 07/24 13:56 Row Crops End Lower With Milder Temperatures Corn and soybeans closed lower Monday as traders faced a more pleasant seven-day forecast with chances for rain across much of the Midwest. The outlook for the northwestern Plains remains dangerously dry, but September Minneapolis wheat was down 15 1/4 cents, as this year's drought rally showed signs of buyer fatigue.

DTN Closing Livestock Comment 07/24 15:52

DTN Closing Livestock Comment 07/24 15:52 Live and Feeder Futures Clobbered by Bearish Supply News The cattle complex closed sharply lower Monday, pressured by the negative implications of inventory reported unveiled on Friday. Lean hog issues settled moderately lower thanks to long liquidation and signs of faltering fundamentals. By John Harrington DTN Livestock Analyst GENERAL COMMENTS Activity in feedlot country was typically limited to the distribution of new showlists. The late month offering is generally larger with only Texas showing fewer ready steers and heifers. According to the closing report, the national hog base is $0.93 lower ($77.00-83.50, weighted average $82.39). The corn market closed several cents lower, checked by weather maps promising milder temps and chances for rain over much of the main growing area. The stock market settled on a mixed basis with the Dow off 66 points and the Nasdaq better by 23.

DTN Chart Technical Points 07/24 16:30

DTN Chart Technical Points 07/24 16:30 DTN FUTURES 10 7/24/17 SLOW STOCHASTIC PRICES ARE DECIMAL MOVING AVERAGES RSI'S 5 Day 20 Day CONTRACT CLOSE 4-Day 9-Day 18-Day 45-Day 9Day 14Day 30Day %K %D %K %D CBTWT SEP 488.75 499.19 507.33 519.61 483.01 35.94 44.07 50.64 25 20 32 39 CBTWT DEC 513.50 523.00 531.03 542.14 505.04 36.76 44.88 51.35 24 19 35 41 KC WT SEP 487.50 496.88 507.75 522.90 488.89 34.13 42.15 49.20 22 16 25 33 KC WT DEC 514.50 523.56 534.31 548.89 514.42 34.51 42.53 49.61 23 16 26 34 MN WT SEP 750.50 767.44 767.53 771.82 675.92 47.98 55.26 61.77 44 54 54 56 MN WT DEC 758.50 773.63 771.42 768.94 675.18 51.40 58.42 64.33 50 60 65 65 CORN SEP 377.25 382.63 379.33 383.22 381.88 45.16 46.87 48.55 53 59 42 36 CORN DEC 390.75 396.31 392.81 395.74 393.09 46.04 47.81 49.40 54 60 48 43 CORN MAR 402.00 407.19 403.47 405.69 402.77 46.95 48.59 49.96 56 62 52 46 OATS SEP 288.75 293.31 288.36 284.69 260.99 56.07 58.62 59.62 64 69 73 68 OATS DEC 287.25 293.75 289.86 285.54 257.72 53.85 58.51 61.46 56 64 77 74 BEANS AUG 997.501004.88 997.69 986.58 953.72 55.66 57.41 55.36 71 69 75 70 BEANS SEP1002.501009.751002.08 990.81 955.45 56.08 57.90 56.26 72 70 76 71 BEANS NOV1010.001017.941010.44 998.19 959.78 55.96 58.06 57.04 71 68 76 72 S MEAL AUG 325.90 328.17 326.18 322.03 310.41 55.53 57.33 55.44 70 64 70 66 S MEAL SEP 327.80 330.17 328.18 323.98 311.95 55.50 57.44 55.90 69 64 71 67 B OIL AUG 33.61 33.71 33.43 33.24 32.54 58.17 57.94 54.69 77 75 84 75 B OIL SEP 33.73 33.84 33.55 33.37 32.67 57.96 57.83 54.75 77 76 83 75 CATTLE AUG 113.88 115.86 116.51 115.82 118.44 39.72 42.21 46.54 31 41 51 63 CATTLE OCT 114.40 116.94 117.50 115.82 116.43 41.15 44.91 49.03 20 43 70 83 FEEDER AUG 148.45 152.04 152.58 149.15 149.81 44.78 47.75 50.53 32 50 74 84 FEEDER SEP 148.68 152.15 152.59 149.21 149.57 45.38 48.27 50.94 34 52 76 85 HOGS AUG 80.38 81.29 81.28 81.92 81.06 43.42 46.69 50.62 33 43 44 44 HOGS OCT 66.45 67.58 68.00 69.10 68.65 33.98 39.23 45.60 21 32 17 26 COTTON OCT 69.00 69.11 68.41 68.75 71.25 50.04 46.30 43.85 79 83 53 41 COTTON DEC 68.29 68.45 67.78 67.81 69.84 51.82 47.92 44.08 74 81 68 47 RICE SEP 12.14 12.00 11.88 11.90 11.62 68.68 65.07 62.05 87 81 67 56 RICE NOV 12.34 12.19 12.09 12.10 11.84 69.42 65.38 62.33 87 79 69 56

DTN Cattle Close/Trends 07/24 15:45

USDA MARKET NEWS--AFTERNOON CATTLE REPORT 07/24/17 VOLUME USDA TOTAL RANGE DTN PRACTICAL RANGE WT AVG KANSAS CONFIRMED CASH SALES - TODAY: 0 WEEK T0 DATE: 0 STEERS No reportable trade HEIFERS No reportable trade NEBRASKA CONFIRMED CASH SALES - TODAY: 0 WEEK TO DATE: 0 STEERS No reportable trade HEIFERS No reportable trade TEXAS CONFIRMED CASH SALES - TODAY: 0 WEEK TO DATE: 0 STEERS No reportable trade HEIFERS No reportable trade COLORADO CONFIRMED CASH SALES - TODAY: 0 WEEK TO DATE: 0 STEERS No reportable trade HEIFERS No reportable trade IOWA CONFIRMED CASH SALES - TODAY: 608 WEEK TO DATE: 608 STEERS No reportable trade HEIFERS 608 186.00-186.00 186.00-186.00 186.00 COMMENTS: Just a handful reported traded in IA, the rest of cattle country Was at a complete standstill. 5-AREA LV STR AVE PR&WT: $119.94(1393) HIDE&OFFAL: $11.61 +0.02 CARCASS EQV INDEX CHOICE (600-900#) SELECT (600-900#) #OF HD LIVE BASED 177.92 164.94 102,188 BOX BASED 195.46 185.89 57,575 AVE INDEX 186.69 +0.77 175.42 +2.17 159,763 BEEF CUTOUTS CHOICE (600-900#) SELECT (600-900#) 207.46 +0.55 197.89 +3.09 52.03 LDS CH CUTS / 24.04 LDS SEL CUTS / 10.01 LDS TRIM / 12.63 LDS GROUND BOXED BEEF TREND: Frm on Ch & shrply lr on Sel on mod-frly gd dem &mod offer COMPREHENSIVE WEEKLY CUTOUT VALUE: Week ending 07/21 $209.32 -2.49 CUTTER 90% 350# UP C/O: $181.51 +0.59 NAT'L BONELESS BF TRIM: 72.36 lds / Modly hr on mod dem & lt-mod offers 90% TRIM: 40 lds: Wtd Avg $233.61 / Firm *ABCDE AFTER QUOTE REPRESENTS DAYS SINCE LAST REPORTED MARKET TEST*. FI KILL(WTD) MON 112 WK AGO 110 YR AGO 110 MIX: FRI SH933/CB22 SAT SH36/CB9 WEEKLY CANADIAN CATTLE IMPORTS. FEEDERS SLAUGHTER S&H Week Ending: 07/08/17 1,418 4,544 Week Ending: 07/01/17 1,372 8,372 Change from prev week: +46 -3,828


 DTN Headline News


Rust on the Move


By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- Defying its name once again, southern corn rust has invaded Midwestern cornfields earlier than ever -- and this time, it arrived in time to do economic damage.

"This is the earliest I've ever seen it -- and that's the third year in a row that I've said that," said Kansas State University Extension plant pathologist Doug Jardine.

The disease has been found in Kansas, Nebraska, Iowa, Indiana and Illinois. You can see a map tracking its spread here: http://bit.ly/….

Later-planted cornfields will be most at risk from the disease, and most corn hybrids are susceptible to it, said University of Nebraska Extension plant pathologist Tamra Jackson-Ziems.

Both Jackson-Ziems and Jardine estimate that most corn plants that are not at the end of dent stage could benefit from a fungicide application if infested.

That accounts for a lot of U.S. corn right now. As of July 17, USDA estimated that 60% of the nation's corn was not yet silking.

Fortunately, most of the rust found in Kansas and Nebraska are low-level detections, Jardine and Jackson-Ziems said. That gives growers time to begin to scout diligently and keep an eye on crop stage and weather conditions.

Currently, conditions are favorable for the disease in most of the Midwest, the plant pathologists noted.

"Southern rust is a tropical disease," Jardine said. "The combination of high nighttime humidity over 90% and hot daytime weather -- that's what it loves."

Because the disease often starts in hotspots within a field, scout multiple places within your fields.


Southern corn rust looks very similar to common rust, but there are some important distinctions. Common rust prefers cooler weather, which is why its progress has slowed in many Nebraska fields, as southern corn rust picks up, Jackson-Ziems said.

Common rust pustules tend to be dark red or brown, and are found primarily on the bottom of corn leaves. In contrast, southern corn rust pustules are more orange and tan in color and more often spotted on the tops of corn leaves.

"If they're not side by side, it's darn hard to tell them apart," Jackson-Ziems admitted. "Pustule location is probably the more important difference for identification, and by all means, get a sample for the diagnostic clinic."

Perhaps most importantly, southern corn rust can be far more economically damaging. Both Jackson-Ziems and Jardine said they have seen up to 30% yield loss in research fields from the disease in the past.

The disease is well-controlled by most fungicides, but knowing when to spray is tricky. Because southern rust's spread and damage potential depend so heavily on weather conditions and crop stage, plant pathologists do not publish specific thresholds at which to treat.

Jackson-Ziems puts it this way: "If I started seeing it in several locations in my own field -- not just in one or two spots -- and the weather conditions were favorable, and the corn was still early in the grainfill stage, I would consider a fungicide application."

Jardine agreed and noted that fields starting to dent are probably beyond much economic damage. Milk to soft-dough cornfields would be well-worth scouting in the next two weeks, however.

"Then there are the fields that are just pollinating -- those are the ones I'm most concerned about," he said. "There's not enough rust out there yet to spray today, but there might be by next week."

Most fungicides will only provide a 21- to 28-day window of protection, so growers with delayed fields should keep in mind that if they spray too early, they may have to re-apply fungicides later in the season, both plant pathologists warned.

For more help on scouting and managing southern corn rust, see these guides from Kansas State: http://bit.ly/…, the University of Nebraska: http://bit.ly/… and Purdue University: http://bit.ly/….

See Jackson-Ziems' article on the disease's spread in Nebraska here: http://bit.ly/…, and follow the disease's spread through the iPIPE's map system here: http://bit.ly/….

Finally, don't forget to tweet any discoveries or questions about the disease in your field, along with your location, to the Twitter account @corndisease.

Emily Unglesbee can be reached at Emily.unglesbee@dtn.com.

Follow Emily Unglesbee on Twitter @Emily_Unglesbee.


E15 Bill Stalled


By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) -- The U.S. Senate Committee on Environment and Public Works will not take up a bill that would have allowed for E15 sales year-round before the August recess, the committee decided Thursday evening.

Several media outlets had reported that the committee would consider the bill next week.

Growth Energy Chief Executive Officer Emily Skor said in a statement to DTN the group will continue to push for the bill's passage.

"We are disappointed the EPW committee decided not to consider the Consumer and Fuel Retailer Choice Act before August recess," Skor said.

"We will continue to work with our bipartisan sponsors to enact this bill to provide drivers across the country cleaner fuel options year-round that are better for the environment and save Americans money every time they fill up the gas tank."

The bill would change a federal regulation that forbids the sale of E15 from June 1 to Sept. 15. It would extend the waiver for Reid Vapor Pressure, or RVP, to E15. Currently, E15 sales are restricted in nearly two-thirds of the country during the summer months because of ozone concerns.

Ethanol and gasoline are both low volatility. When the two fuels are mixed, the volatility spikes, but only at blends just below E10. As more ethanol is blended with gasoline, the vapor pressure decreases, which essentially means E15 reduces vapor pressure.

Brian Jennings, executive vice president of the American Coalition for Ethanol, said in a statement Friday that his organization will continue to pursue passage of the bill. Jennings thanked the lead authors of the E15 bill, Sens. Deb Fischer, R-Neb., and Joe Donnelly, D-Ind. Jennings and added, "As senators return to their home states during the upcoming August recess, we encourage ACE members press them on the need to whip up enough bipartisan support to eventually enact this legislation. Meanwhile, ACE also continues to urge EPA Administrator (Scott) Pruitt to grant RVP relief as the Trump administration takes steps to reduce regulatory burdens on American businesses."

Biofuels groups this week have been making a push to move the "Consumer and Fuel Retailer Choice Act" across the finish line.

On Thursday, a group of 26 advanced biofuels and agriculture companies and groups pressed Senate leaders to pass the bill, considered critical to the advancement of cellulosic ethanol and other technologies.

Those groups include the Biotechnology Innovation Organization, or BIO, along with the Advanced Biofuels Business Council, POET DSM, Syngenta, Novozymes, Pacific Ethanol and others.

In a letter, the companies and groups ask Senate leadership to leave the bill as is without amendments. In addition, the groups say the bill is critical to the future of the cellulosic ethanol industry.

"Some stakeholders have characterized S. 517 as a corn ethanol bill," the letter said. "Cellulosic and corn ethanol are the same molecule (ethanol) produced from different feedstocks. Both can be blended to make E15. However, the federal Renewable Fuel Standard sets renewable fuel blending obligations on oil companies.

"With the conventional biofuel standard now fulfilled (at 15 billion gallons per year), all future growth under the RFS is in advanced/cellulosic biofuels. The RFS puts the cellulosic ethanol industry in best position to benefit from passage of this legislation.

"Finally, any effort to attach RFS-related amendments to S. 517 -- even if intended to help advanced or cellulosic biofuels -- should be abandoned and rejected. Opening the RFS to legislative change will destabilize investment and make it harder for cellulosic and advanced biofuels to thrive. Importantly, the current proposal does not change U.S. motor fuel policy -- it merely clarifies that an RVP waiver already offered to 10% ethanol blends is available for higher ethanol blends (because they are cleaner)."

Todd Neeley can be reached at todd.neeley@dtn.com

Follow me on Twitter @toddneeleyDTN


Drought in the Dakotas

By Chris Clayton
DTN Ag Policy Editor

BISMARCK, N.D. (DTN) -- Scattered thundershowers across North Dakota on Wednesday brought a slight respite to the region's drought, but farmers and ranchers say some crops are already lost and it would take months of rainfall to rebuild pastures.

Dryland corn from central South Dakota up through North Dakota normally would be 6-feet tall by now, but crops are grossly stunted. Some fields are tasseling at just 3-feet tall, while in other fields the stalks are already browning with no signs of tasseling. Soybean fields are similarly stunted, but crops such as soybeans and sunflowers more likely will benefit if rains continue.

"We saw light showers with locally heavier favoring southwest North Dakota through northern and eastern South Dakota over the past 24 hours," said DTN Senior Ag Meteorologist Bryce Anderson. "Most of the showers produced no more than .50 inch. Drought easing will only be short-term. There is not much follow-up rain in the forecast through the end of the week, either, although temperatures will be less hot than we've seen during July so far."

Mark Watne, president of the North Dakota Farmers Union, has been touring parts of western North Dakota this past week to talk to producers about the farm bill. The farther north and west, the worst the conditions are for farmers and ranchers, he said.

"It's a crisis. It's way more than people think. I've driven through areas where you would expect to see a spindly wheat stand, but there's no crop left -- it's gone," Watne said. "It's almost hard to tell what they did out there."

Driving through South Dakota, nearly every open roadside ditch along state highways is now baled. Most cattle producers in western North Dakota have seen their pastures dry up and there is little hay in the area. Any bare nook or cranny -- or piece of grass -- is getting cut up for hay.

USDA has opened up the Conservation Reserve Program for haying, but there are growing complaints that landowners are charging exorbitant prices for hay coming off that CRP ground. "I've heard some of those complaints," Watne said.

Just Thursday, USDA updated its CRP rules in Montana, North Dakota and South Dakota to allow emergency haying and grazing on CRP wetlands and buffers.

Ranchers used up a lot of their reserve hay in the winter when North Dakota was hit with about 75 inches of snow that required ranchers to feed their cattle more. That took out some of the hay they might otherwise still had to use.

Adnan Akyuz, North Dakota's state climatologist, said this week that the state is facing its worst drought conditions since 2006. The U.S. Drought Monitor on July 20 showed about 6% of the state is now in an "exceptional drought," the worst ranking offered by the drought monitor. http://droughtmonitor.unl.edu

Steve Perdue raises spring wheat and durum near Ray, North Dakota in the northwest corner of the state. Some of Perdue's crop won't be harvestable, especially the later-seeded crop. The earlier-planted wheat might pull out some bushels, he said.

"I think this year in North Dakota, at least in the western half, probably two-thirds of South Dakota and the eastern half of Montana, we're seeing what crop insurance means to the farmers," Perdue said. "Our crop insurance program is not adequate. It doesn't get us where we need to be, but it gets us a whole lot better than zero or trying to get through this alone."


Perdue agreed that in the next farm bill he would like to see crop insurance enhanced. "We can't withstand any more cuts to crop insurance," he said.

Perdue said the 70% level of insurance normally works, but the subsidy level declines quickly and it becomes a lot more costly to buy up coverage. He does carry the Harvest Price Option and expects he will benefit there from the higher spring wheat prices.

The crop insurance coverage levels that farmers can afford is a concern for Watne. The 70 to 75% level might cover operating expenses, but leaves little for covering any family expenses. Farmers who have burned into their equity, or are younger and may have little equity with the bank, face mounting struggles, he said.

"If we could somehow get 80 to 85% coverage I think that would make a big difference, but it's going to have to be subsidized more," Watne said.

Watne also would like to see Congress consider a disaster package to help with the drought losses, but he recognizes that Congress has turned against disaster aid over the last decade.


Wes Niederman, a rancher from Morristown, N.D., said his pastures so far are manageable because he's cautious not to overgraze them with his 400 or so cows and their calves. The problem would be next year if his ranch doesn't get more moisture because the fields that have already been grazed are not recharging.

"It looks like a hardwood floor," he said. "That's my concern going forward. People sort of have a contingency plan for this year and a lot of people are probably going to make it through this year OK because they probably had some hay left over and they are going to scrape through."

Niederman's hay crop, though, was probably one-fourth of what was expected. "Generally, we get about 2,000 bales and we got 477 out of what we cut." His winter wheat crop, though, was a loss and he ended up cutting it for hay as well.

Up until earlier this week, Niederman's ranch had gotten about 1.2 inches of rain since April. Some spots have gotten about an inch of rain this week. "So it's encouraging, but it's not going to solve things."

Others across the state, though, are already weaning calves born in March or April to try to save grass. At least some sale barns are seeing more business and have added auction days during the week as well.

"Pastures are gone and they are selling their breeding stock, which is really sad because you just can't replace that," Watne said.


Niederman also expressed some frustration over USDA programs. About three weeks ago, he got an email from USDA that said he had qualified for the Emergency Conservation Program, which would help cost-share practices such as digging a well. He has a South Dakota pasture without water because the creeks are drying up. The local Farm Service Agency office was helpful filling out the paperwork, but once the application was completed, Niederman said there was a notification that there was no money available for the program. So now Niederman will be waiting likely months for the funding to come through.

"They said it will probably be October or November before you see any dollars at all," Niederman said. "Well, in November, there aren't going to be any cattle in this pasture and it won't do many any good. I also don't think I won't find anyone to come out in November to drill a well when it's cold."

He added, "Some way, when they come out and say that you are qualified for a disaster, or whatever, the dollars should be there so as soon as I get a contractor or the project is approved, you can start and the money is there and you don't have to wait."

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN


Aid Boosts for Cotton, Dairy

By Jerry Hagstrom
DTN Political Correspondent

WASHINGTON (DTN) -- The Senate Appropriations Committee on Thursday passed a fiscal year 2018 Agriculture appropriations bill that would provide new aid to both cotton and dairy producers.

The bill would designate cotton seed as eligible for the Price Loss Coverage program while also propping up the Margin Protection Program for dairy farmers.

A summary of the bill's highlights distributed by Senate Appropriations Committee Chairman Thad Cochran, R-Miss., noted that "The bill includes a provision which seeks to address the ongoing economic challenges facing U.S. cotton producers, and the entire U.S. industry, by designating cotton as an 'other oilseed' under Title I of the 2014 farm bill. This would allow cotton producers to participate in the Price Loss Coverage (PLC) program just like all other major U.S. commodity producers."

Cotton producers have urged both former Agriculture Secretary Tom Vilsack and current Secretary Sonny Perdue to declare cotton seed an oilseed, but each has said that the USDA general's counsel office has advised that the secretary does not have the authority.

National Cotton Council Chairman Ronnie Lee, a Georgia producer and ginner, thanked Cochran "for his strong leadership on this issue" and said the policy, if enacted, "would apply beginning with the 2018 cotton crop, the last year of the current farm bill, and would help address the significant economic challenges currently facing America's cotton farming families."

Lee noted that the House Agriculture appropriations bill includes report language regarding a cottonseed policy and urges USDA to operate the $300 million Cotton Ginning Cost Share program beginning with the 2016 crop. He also said 26 senators and 109 representatives have sent President Donald Trump and Agriculture Secretary Perdue letters asking that USDA restart the Cotton Ginning Cost Share program, initially operated for the 2015 crop, for 2016.

"Both policy initiatives are needed to help U.S. cotton farmers deal with the ongoing financial stress and bridge the policy gap for cotton until the new farm bill is implemented," Lee said.

Senate Appropriations ranking member Patrick Leahy, D-Vt., said in a news release that the bill includes provisions to improve the effectiveness of the Margin Protection Program and offer greater incentives for farmers to participate in the program.

Making these changes now rather than waiting for the farm bill next year allows USDA to implement these changes for a portion of the 2018 calendar year, Leahy said. If dairy farmers are forced to wait until the farm bill expiration next fall, it is unlikely that USDA would be able to implement any of these greatly needed changes until 2020, he added.

"These are crucial investments for dairy farmers who should not have to suffer through yet another year of a risk management program that falls short of providing an effective farm safety net," Leahy said. "I am hopeful that we can move forward from this starting point and first step, to reach a final bipartisan agreement that delivers an effective farm safety net to our nation's dairy farmers and cotton producers."

The House funding bill does not have similar provisions for cotton or dairy. These funding bills will have to eventually be reconciled before USDA is funded for fiscal-year 2018, which begins in October.

Leahy said the provisions make five specific changes:

1. "Moves the Margin Protection Program (MPP) calculations and potential payments to a monthly basis (currently bimonthly) to improve the program's accuracy and timeliness in responding to market conditions.

2. Dramatically reduces the premium costs for Tier I enrollment to incentivize producer participation at meaningful coverage levels of protection.

3. Adjusts the Tier I threshold level corresponding to substantially lower premium costs, to the first 5 million pounds of production, up from the current level of 4 million pounds of production (equivalent to 185 cows). This will better align the program with the median U.S. dairy farm size, 223 cows, and encourage more farms to participate and secure meaningful levels of protection to offer an effective farm safety net.

4. Waives $100 administrative fees for underserved producers, bringing the program in line with other USDA programs with similar service fee waiver, such as the Noninsured Crop Disaster Assistance Program (NAP).

5. Continues the program's current regulation offering farmers a one-time election to participate in the program for the length of the farm bill."

Rural Development amendment

The manager's amendment offered by Senate Agriculture Appropriations Subcommittee Chairman John Hoeven, R-N.D., included $896,000 to operate the Office of the Undersecretary for Rural Development and added language amending the 1994 Agriculture Reorganization Act to say that the secretary "shall" establish that office, even though the Trump administration has already moved to abolish that position.

Sen. Jon Tester, D-Mont., said during the markup that even though he is pleased with the job that Perdue is doing, "one of the problems is that you have a president who has only known urban America."

Tester said, "I look forward to the president putting up a nominee and I hope he does."

Rural development "can stop the mass exodus of people from rural America," Tester added.

Perdue told DTN on Thursday that he considers the provision to be a matter of "nomenclature." Noting that he has established the position of assistant for rural development in his office and named Anne Hazlett, a former Senate Agriculture Committee aide, to that position, he said Hazlett will do a good job whether she is an assistant to him or an undersecretary.

Perdue said he still considers that having an assistant in his office reporting directly to him to be an "elevation" of the post, while senators have said they believe an undersecretary has more authority.

Other Amendments

The committee also adopted by voice vote an amendment offered by Sen. Lisa Murkowski, R-Alaska, to require labeling of genetically modified salmon, and one offered by Sen. Tom Udall, D-N.M., to forbid USDA from inspecting horses under the Federal Meat Inspection Act.

Sen. Jean Shaheen, D-N.H., offered, but then withdrew an amendment to end nonrecourse loans for cane and beet sugar to any entity that makes more than $300 million.

Shaheen said she realized that she was "tilting at windmills here" because she did not have the votes to get the measure through the committee.

"Like you I fight for my constituents," she said, noting she wanted to "put folks on notice ... [that] this is a program we need to look at" because she believes the higher prices for sugar have led to job losses in the sugar-containing products industry.

Hoeven said, however, that the program is needed because Mexico and other countries can "dump" sugar into the U.S. market with the European Union remains closed off to imports.

The major provisions of the bill are listed in a summary on the Senate Appropriations Committee website. http://dld.bz/…


Worm Rebellion Continues

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- From the Carolinas to Texas, the cotton bollworm is leading an assault on Bt cotton again this year.

Growing resistance to the Bt traits found in the most common cotton varieties is proving problematic as southern states face another large population of the pest, said North Carolina State University Extension Entomologist Dominic Reisig.

"We're seeing earlier and higher bollworm populations than normal," he said. "As the season progresses, that means we'll see more generations of the insect."

For now, entomologists are trying to get growers reacquainted with how to scout for bollworm eggs and caterpillars in order to make timely insecticide applications.


Last year, Texas A&M Extension entomologist David Kerns confirmed that some bollworm populations are resistant to Cry1Ac, the Bt protein found in both Monsanto's Bollgard II and Dow AgroSciences' WideStrike cotton varieties.

Now Kerns has also confirmed that some populations tested from Louisiana and Tennessee last year have resistance to Cry2Ab -- the second protein found in Bollgard II. Nor can growers lean on the second protein in WideStrike cotton, Cry1F, which has only sublethal effects on the bollworm, Reisig said.

Growers may also see problems with Bayer's TwinLink cotton, which expresses the proteins Cry1Ab and Cry2Ae, which act similarly to the proteins found in Bollgard II, Reisig said.

Many bollworms might be moving into cotton from corn this year (where they are called the corn earworm). There, they have been exposed to similar Bt proteins and may already be predisposed to survive on Bt cotton, Reisig added.

"Growers can't just lean back on Bt cotton and expect it to work this year," he said. "Especially not with the bollworm populations we're seeing."

The good news is that Monsanto, Dow and Bayer have all added the Bt protein Vip3A to new cotton varieties called Bollgard 3, WideStrike 3 and TwinLink Plus, respectively.

These products should supply good control of the bollworm, but their availability isn't as widespread as the older varieties yet, Reisig noted. Bollgard 3, in particular, won't have a full commercial launch until 2018, although some varieties are being planted on a limited scale this year.


Growers have two options for scouting the bollworm -- doing a pro-active search for eggs or a secondary search for emerged caterpillars.

The egg method is complicated by the fact that there is no good way to distinguish the eggs of the bollworm from the eggs of the tobacco budworm, which is well-controlled by Bt cotton, Reisig noted. The eggs will be white and tiny -- smaller than a pencil point -- and laid singly, not in bunches.

Most guides recommend looking on leaves in the terminal of the plant for eggs, but in North Carolina they are also commonly found in the middle of the plants, near blooms, Reisig said.

Reisig recommends spraying if eggs are found on 25% of the terminals scouted. In a university news article, Mississippi State entomologist Angus Catchot recommended Mid-Southern growers lower that threshold to just 10 to 15% egg infestation on "bloom tags" for WideStrike varieties. (See his article here: http://bit.ly/…).

The second strategy involves scouting for emerged bollworm caterpillars and spraying when they are still quite small and haven't yet burrowed into a bloom, square or boll.

This approach weeds out any tobacco budworm caterpillars, which will be controlled by the Bt proteins, but it requires being familiar with the size of different larval stages of bollworm. In a university article, Reisig categorizes the thresholds as follows: "Three second-stage bollworm (or larger) in 100 fruiting tissues on one scouting trip, two second-stage bollworm (or larger) in 100 fruiting tissues on two consecutive scouting trips, or one second-stage bollworm (or larger) in 100 fruiting tissues on three consecutive scouting trips)." (See his article here: http://bit.ly/….

Catchot recommends only diamides insecticides (or high rates of Intrepid Edge) for control of the bollworm in the Mid-South, as pyrethroids are not showing good control of the bollworm there anymore. Even with diamides, don't expect 100% control if you're spraying emerged caterpillars, he warned.

In North Carolina, pyrethroids are still among the insecticides recommended for use against bollworm, Reisig said. See a list here: https://goo.gl/….

Be sure to check for more local thresholds and insecticide recommendations with your state Extension office, as they can vary by state and region.

Emily Unglesbee can be reached at emily.unglesbee@dtn.com.

Follow Emily Unglesbee on Twitter @Emily_Unglesbee.


Spring Wheat Tour Preview

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- When crop scouts hit the road next week for the Wheat Quality Council's annual Hard Spring Wheat and Durum Tour, they'll take plenty of water, said tour organizer and council president Dave Green.

It's a pity they can't take enough for the wheat crop.

After a week of temperatures in the upper 90s, the spring wheat crop is showing the effects of months of drought in the Northern Plains, Green said.

"This is a crop that went bad because they just didn't get normal rains in the spring and early summer," he said. "It's struggling."

Scouts are likely to see lower yields and fewer wheat fields than normal, Green said. Many growers have abandoned acres at high rates in the western halves of South and North Dakota, where drought conditions are most severe.

In its most recent Crop Progress report, USDA estimated that 40% of the North Dakota crop is in poor-to-very poor condition and 32% in good-to-excellent condition. South Dakota's crop is in even more dire conditions -- the agency rated it 74% poor-to-very poor, with just 8% in good-to-excellent condition.

Each year on the spring wheat tour, crop scouts pack into vans and trucks and fan out onto established routes through the Northern Plains. Scouts stop and take measurements in wheat and durum fields as they go and use a formula to estimate yield. At the end of each day, each route submits its yield findings and an average yield number is announced for the day. On the third and last day of the tour, a final tour average is calculated and released.

This year, the tour will bring along 76 attendees, mostly farmers, millers, bakers, seed company and industry representatives, as well as members of the media, Green said.


The scouts will start in Fargo, North Dakota, on Monday, July 24. Usually they cover western Minnesota, central North Dakota, and eastern South Dakota the first day, before ending in Bismarck, North Dakota. This year, the tour may well skip the South Dakota section, simply because so much of that region has moved away from wheat acreage and into soybeans and corn, Green said.

On Wednesday, scouts will explore western and northwestern North Dakota, skirting the borders of Montana and Canada, before ending the day in Devils Lake, North Dakota. On Thursday, the tour drives through northeastern North Dakota on its way back to Fargo.

Scouts will see drought-compromised fields, but also fewer of them, Green noted. In the driest areas in south-central and southwest North Dakota and western South Dakota, he's heard estimates of field abandonment ranging from 30% to 55%.

Those fields were likely terminated or cut for hay, a much-needed commodity for drought-stricken local ranchers, said Tim Luken, who manages Oahe Grain Corporation in Onida, South Dakota. He estimates 15% to 20% of the spring wheat in his area has been baled for hay or sprayed out.

Most of the haying is probably done, as producers aim to have green wheat for the best livestock forage, Green said. "Everyone has told us that when we get there, if we see fields turning color and still standing, they're probably going to harvest it," he said.

USDA expects a spring wheat crop of just 423 million bushels, down 21% from last year, according to the agency's Crop Production report released July 12. Harvested acreage was pegged at 10.5 million acres, a 7% decline from 2016.


Durum production is also expected to plummet 45% to 57.5 mb this year, with acreage shrinking 21% from 2016 to just 1.86 million acres.

Yields will likely be low and variable, Luken said. USDA pegged the spring wheat crop's average yield at 40.3 bushels per acre, down 6.9 bushels from last year.

Luken said he heard estimates from western South Dakota ranging from 12 to 28 bpa. In central South Dakota, he predicted some fields may brush 30 bpa, but nowhere near the 34 bpa that USDA estimated for the state's average yield, he said.

"And those are the good fields," he noted. "There are a lot more bad fields than good ones."

Green said scouts will have to take special care this year to properly calculate yields in droughty fields.

"The thing we're worried about this year is that when it's this hot and dry, sometimes kernels don't even fill," he said. "We'll be training people to see how good the pollination has been -- to be sure to peel heads open and make sure there are kernels there."

Insects and disease aren't likely to be prominent this year, both Green and Luken agreed. "It's hard to have too many insects or diseases without moisture to feed them," Luken noted.

Harvest is 5% underway in South Dakota, and the North Dakota crop was just over a quarter coloring as of July 17, according to USDA.

Although tour scouts can't measure it, all eyes will be on protein levels in the spring wheat crop, Green noted.

Two years in a row of low-protein winter wheat crops have taken a toll on the milling and baking industry, which requires protein levels around 13% to 14%. Usually these end users rely heavily on a high-protein spring wheat crop to bring protein levels up in their blends.

Protein levels in the droughty crop this year will probably be higher, but lowered quality and a smaller harvest will hurt, Green said.

"It'll be much higher in protein than normal, but not the way you like to get protein," he said. "Wheat will be shriveled and have low test weights, which tends to cause milling issues."

You can see last year's Hard Spring Wheat and Durum Tour results here: http://www.wheatqualitycouncil.org/….

Follow DTN for daily stories on the tour's findings next week.

Emily Unglesbee can be reached at Emily.unglesbee@dtn.com.

Follow Emily Unglesbee on Twitter @Emily_Unglesbee.


Kub's Den

By Elaine Kub
DTN Contributing Analyst

Grain markets played a huge role in human history. The very formation of early nation states and all the "great" early civilizations -- the Sumerians, the Egyptians, the Han Dynasty -- were only possible once humans started growing grain, and the history lessons all take it for granted that this is a good thing. Farming is a noble and desirable profession, and everyone should want to do it.

But history lessons would say that, wouldn't they? By definition, if we are still reading about a civilization today, it's only because that civilization happened to have some class of elites sitting around with enough time and education to write things down. There are no surviving epics from the "barbarians" who passed their time hunting and gathering and moving from place to place in small bands, as their desires moved them, although this might have been a much more pleasant, healthy way to live compared to life in the shadow of the Ziggurat of Ur.

The writing elites were supported by the excess grain taken away (taxed) from the broader population of working, drudging peasant farmers, so of course the elites thought that grain was pretty great. Of course that's how written history remembers this development in human civilization. One Sumerian text reads, "Whoever has silver, whoever has jewels, whoever has cattle, whoever has sheep shall take a seat at the gate of whomever has grain, and pass his time there."

But a forthcoming book called Against the Grain: A Deep History of the First Civilizations from James C. Scott, political scientist, anthropologist, and Director of the Agrarian Studies Program at Yale University, tosses all these assumptions upside down.

It's true that there was no such thing as an organized nation state without farming, and this was a newly powerful system of human organization, one that really only developed within the past 400 years across most of the globe. However, Scott points out the ways that humans themselves were "domesticated" (basically enslaved) to make this at all possible for the relatively few elites among a population. He leaves a reader wistful for a time when roving bands of humans had a better leisure-to-drudgery ratio (about 50/50) compared to the constant hard work that our farming ancestors have convinced us is so virtuous.

Think about it: even today with the significant aid of technology, how many hours have farmers invested in this season of growing crops, and how much of that effort is ultimately going to be sent to the government as taxes? Don't get me wrong -- I personally enjoy living in a society with well-maintained roads and law and order, but there's always a certain temptation to just live off the fish you can catch in the river and the wild plums you can harvest from the roadsides. How much stronger must that temptation have been when the choice was even starker: sitting around a campfire with your hunter friends, or collapsing at the end of a day spent hoeing weeds in Pharaoh's wheat fields?

As Scott puts it, "Why anyone not impelled by hunger, danger, or coercion would willingly give up hunting and foraging or pastoralism for full-time [fixed-field] agriculture is hard to fathom."

Grain states were fragile things, usually disintegrating within two or three reigns, due to sudden new epidemic diseases (human diseases or grain diseases, all only possible now that large populations were concentrated in one urban area), or drought or flood or pestilence, or climate variation, or the exhaustion of the soil and other nearby resources, or overly rapacious taxation and the subsequent fleeing of the peasant population. All the "Great Walls" of history, including the first one built in 2000 BC by the Sumerian King Sulgi between the Tigris and Euphrates rivers, were built as much to keep a tax-paying population IN, as to keep barbarians OUT.

But during the time when any nation state thrived, it was only possible because of grain. Sure, there could be a sedentary grain farming population without any nation state, but there was never any such thing as a nation state without grain farming.

Population centers might develop, and wealth might be accumulated within a town, but in order to politically enclose a real empire, supported by other people's labor, a nation state needed to be based on an easily taxable product. Wheat (or barley or teff or any other cereal grain) can be dried and stored; it can be transported; it is visible, divisible, rationable, and assessable. In other words, its annual production can be easily seen and accurately counted by the tax collectors, unlike almost any other agricultural crop. Even wool was difficult to tax because the shepherds kept moving around and shearing their sheep in different locations. Once a grain crop is planted, it stays in one place and the peasantry must stay there, too.

That is how the farming tradition of growing ever-more grain got started. More yield per field, more fields per farmer, more of anything there can be more of. As Scott writes, "In the absence of either compulsion or the chance of capitalist accumulation, there was no incentive to produce beyond the locally prevailing standards of subsistence and comfort ... Beyond sufficiency, there was no reason to increase the drudgery of agricultural production."

Only 240 human generations have passed since the first adoption of agriculture (can you believe that?), and Scott calculates that perhaps no more than 160 generations have elapsed since grain farming became a widespread practice. It only took that many people to pass down and reinforce every deeply held attitude and belief we currently hold about farming.

It is fascinating to read the details of that progression, to think about how these beliefs originated, and to consider how closely we should still treasure them today.

*Against the Grain: A Deep History of the First Civilizations by James C. Scott. Yale University Press, 336 pp, $26.00, August 22, 2017, ISBN 978 0300182910

Elaine Kub is the author of "Mastering the Grain Markets: How Profits Are Really Made" and can be reached at elaine@masteringthegrainmarkets.com or on Twitter @elainekub.


China to Import More US Soy

By Lin Tan
DTN Markets Editor

DES MOINES, Iowa (DTN) -- Seven Chinese soybean buyers signed agreements here last week to buy 12.5 million metric tons (460 million bushels) of 2017-2018 U.S. soybeans, the second-largest deal after the 2015 agreement.

"This is a deal of 5 billion U.S. dollars," said Xiaoping Zhang, China country director of the U.S. Soybean Export Council.

"They basically bought the entire production we have in the state of Iowa," said Iowa farmer April Hemmes. "To have the Chinese come and basically buy our entire production is huge."

China had imported 66.36 mmt (2,438 mb) of 2016/17 crop soybeans so far. According to China market estimates, there will be more than 23.7 mmt (870 mb) of soybeans on the way to China in the following three months, bringing total imports of 2016/17 crop to 90 mmt, a little shy of USDA estimates.

In its July 12 World Agricultural Supply and Demand Estimates (WASDE) report, USDA estimated China would import 91 mmt of 2016/17 soybeans.

"Soybean exports have become the largest amount of U.S. commodities sold to China," Zhang told DTN after the signing ceremony. "Larger than Boeing aircraft exports."

A May 2017 report "Research on the Relation of China-US Economic and Trade" from the China Ministry of Commerce said, in 2016, the U.S. exported 33.6 mmt of soybeans, 440 aircrafts and 255,000 cars to China, valued $13.8 billion, $12.5 billion, and $12.1 billion respectively. Soybeans ranked first in U.S. exports to China.

While this is a large number of soybeans bought, we need to keep in mind that a Chinese delegation does this same sort of thing here in the United States every year. The fact that it is the second largest, to 2015, is more a statement regarding the continued growth of demand more than the value of U.S. soybeans on the global export market. It is a good start, but certainly continued business will need to be seen as the 2016-2017 marketing year ends (at the end of August) and 2017-2018 begins.

"There are still huge growth potentials for U.S. soybean exports to China in the future," said Hai Xu, counselor for science and technology with the Chinese Consulate in Chicago. Xu also contribute this results of contracts signing to the results of "the 100-Day Action Plan."

Chinese President Xi Jinping and U.S. President Donald Trump had agreed in their first meeting in April this year to carry out a "100-Day Action Plan" under the framework of the U.S.-China Comprehensive Economic Dialogue (CED).

USDA expects China to import more than 94 mmt (3,454 mb) of soybeans in the 2017-18 crop year.

To further facilitate Chinese consumers, "U.S. farmers will also produce higher-quality soybeans for the Chinese market," Jim Sutter, CEO of the U.S. Soybean Export Council, told DTN. "The U.S. Soybean Checkoff had supported several U.S. seed companies in breeding better soybean varieties with higher required animal acid content, which will add value to soybean meal products."

Statistics shows that 62% of U.S. exported soybean went to the China market, added Zhang.


DTN Retail Fertilizer Trends

By Russ Quinn
DTN Staff Reporter

OMAHA (DTN) -- For the second straight week, retail fertilizer prices are showing significant movement after five months of holding mostly steady, according to fertilizer retailers surveyed by DTN. Prices for all eight of the major fertilizers were lower the second week of July 2017 compared to a month earlier.

As the fertilizer application season wraps up for this growing season, retail prices are beginning to decrease with lower demand.

Anhydrous is 10% lower compared to last month while urea is 5% less expensive. Anhydrous had an average price of $451 per ton while urea was at $321/ton.

The remaining six fertilizers had just slightly lower prices compared to last month. DAP had an average price of $436/ton, MAP $467/ton, potash $340/ton, 10-34-0 $431/ton, UAN28 $235/ton and UAN32 $268/ton.

On a price per pound of nitrogen basis, the average urea price was at $0.35/lb.N, anhydrous $0.28/lb.N, UAN28 $0.42/lb.N and UAN32 $0.42/lb.N.

Retailers report fertilizer prices are pushing lower as the application season wraps up and as retailers prepare to refill their fertilizer stocks. Steve Lias, general manager of Farmers Elevator Company located in Humboldt, South Dakota, told DTN nitrogen products in particular are moving lower right now.

"I think we are seeing urea and other nitrogen products significantly lower because of the new domestic supplies we now have in place," Lias said. "We pull from Port Neal's (Iowa) new facilities, and we do our own hauling now."

Lias said he thinks some retailers may hold off on their summer fill activities for a bit just to see how low prices fall. The danger of this, of course, is prices could always go the other direction, he said.

Longer term, Lias said, he believes nitrogen does not have much upside pressure while phosphorus fertilizers could hang around at their current levels.

"I think if there is one fertilizer which could be higher come fall it might be potash," he said. "We are already so low I could easily see a $20-per-ton increase to the price by then."

Prices of all retail fertilizers are lower compared to a year earlier. Five of the eight major fertilizers are double digits lower.

10-34-0 is 20% lower from a year ago while anhydrous is 17% less expensive, UAN32 is 13% lower, UAN28 is 12% less expensive and urea is 11% less expensive. DAP is 7% lower, MAP is 6% less expensive and potash is 5% lower.

DTN collects roughly 1,700 retail fertilizer bids from 310 retailer locations weekly. Not all fertilizer prices change each week. Prices are subject to change at any time.

DTN Pro Grains subscribers can find current retail fertilizer price in the DTN Fertilizer Index on the Fertilizer page under Farm Business.

Retail fertilizer charts dating back to 2010 are available in the DTN fertilizer segment. The charts included cost of N/lb., DAP, MAP, potash, urea, 10-34-0, anhydrous, UAN28 and UAN32.

DTN's average of retail fertilizer prices from a month earlier ($ per ton):

July 11-15 2016 467 496 358 360
Aug 8-12 2016 453 482 344 345
Sept 5-9 2016 446 464 325 325
Oct 3-7 2016 438 451 312 315
Oct 31-Nov 4 2016 436 451 314 319
Nov 28-Dec 2 2016 435 445 318 331
Dec 26-30 2016 431 443 321 336
Jan 23-27 2017 429 443 322 347
Feb 20-24 2017 433 452 332 359
Mar 20-24 2017 438 464 338 356
Apr 17-21 2017 438 466 339 352
May 15-19 2017 437 471 340 350
Jun 12-16 2017 437 470 341 338
Jul 10-14 2017 436 467 340 321
Date Range 10-34-0 ANHYD UAN28 UAN32
July 11-15 2016 538 547 266 306
Aug 8-12 2016 528 522 249 299
Sept 5-9 2016 478 502 228 274
Oct 3-7 2016 454 472 224 263
Oct 31-Nov 4 2016 452 471 244 262
Nov 28-Dec 2 2016 447 465 217 256
Dec 26-30 2016 437 466 217 254
Jan 23-27 2017 436 480 235 268
Feb 20-24 2017 440 490 241 276
Mar 20-24 2017 441 507 248 280
Apr 17-21 2017 437 509 247 280
May 15-19 2017 436 510 248 283
Jun 12-16 2017 435 500 246 278
Jul 10-14 2017 431 451 235 268

Russ Quinn can be reached at russ.quinn@dtn.com

Follow Russ Quinn on Twitter @RussQuinnDTN


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