First Take — After the Weekend: June 10, 2024

FY 2025 Ag Approps | WASDE June 12 | FOMC, CPI June 12 | Court rules against USDA | April pork exports largest in nearly three years; beef exports also trend higher

June 10, 2024

Early morning look at the beginning of the week including some items on Profarmer.com, AgWeb.com or AgriTalk, or some weekend topics that will be detailed further in the mid-morning Updates or are in The Week Ahead (link).

• House to focus on fiscal year (FY) 2025 Ag appropriations measure. Link to The Week Ahead for details of Washington’s agenda.
  
• Ag markets last week (Pro Farmer): The wheat market rallied aggressively during spring amid crop concerns in Russia and other areas of the world. While Russian crop estimates continue to decline, seasonal harvest pressure is now weighing on futures. Corn and soybeans initially followed wheat lower last week, but futures rebounded amid forecasts for hot temperatures in the central U.S. by mid-June. Weather will remain a focus this week, along with USDA’s updated old- and new-crop balance sheets and the second winter wheat production estimate on June 12. Cattle futures faced pressure from the pullback in cash cattle prices, though big discounts to the cash market helped limit selling. Hog futures extended their price slide as traders virtually wiped-out premiums summer contracts held to the cash index.
  
• Oil prices posted their third straight weekly loss as investors weighed OPEC+ reassurances against the latest U.S. jobs data that lowered expectations of a looming Fed rate cut. The dollar rallied 0.8% to a more than one-week high shortly after the release of the jobs report. Brent was down 2.5% for the week while WTI was down 1.9%.
  
• Key U.S. economic reports come Wednesday with the CPI report and then the FOMC which will release a statement on interest rates, updated Fed projections and a presser with Fed Chair Jerome Powell.
  
• The Western United States experienced its first heat wave of an expectedly hot summer last week, with record highs in cities like Phoenix and Las Vegas. As extreme heat events become more frequent and prolonged, businesses are increasingly noting the impacts. Mentions of “excessive heat,” “extreme heat,” and “heat waves” have peaked during third-quarter earnings calls in recent years, according to data platform AlphaSense. Link to more via the NYT. Meanwhile, heat waves have a big economic impact. A 2022 study, published in the journal Science Advances, that looked at the impact of human-caused heat waves between 1992 and 2013 estimated that they cost the global economy between $5 trillion and $29.3 trillion. Those costs are likely to rise over time.
  
• AgriTalk’s free-for-all program on Friday (link) focused on new farm bill developments, with Tom Sell of Combest-Sell Associates explaining why House Budget Chairman Jodey Arrington (R-Texas) is helping House Ag Chair GT Thompson (R-Pa.) relative to budget scoring. Sell also explained, in English, the issues surrounding the debate about tapping the Commodity Credit Corporation for funding. Meanwhile, a question was raised about how soon voters can mail in votes ahead of the Nov. 5 presidential election. See the next item for the answer.
  
• Voters can begin mailing in their votes ahead of the Nov. 5, 2024, presidential election starting on different dates depending on their state. Here are some key points regarding the timelines and variations by state:
  

General timeline:

• • Absentee ballots for the 2024 general election will start being mailed out to eligible voters on Sept. 6, 2024.
    

State-specific variations:

• • Each state has its own deadlines for requesting and returning absentee ballots. For example, in Pennsylvania, the deadline to apply for a mail-in or absentee ballot is one week before the election, and the ballots must be received by the county election board by 5 pm on Oct. 29, 2024.
  • Some states require absentee ballots to be received by Election Day, while others accept ballots postmarked by Election Day and received within a certain number of days after the election.
    

Resources for detailed information:

• • Ballotpedia (link) provides a comprehensive listing of election-related dates, including absentee/mail-in ballot request and return deadlines for all 50 states and Washington, D.C..
  • U.S. Vote Foundation (link) offers an Election Dates and Deadlines tool (link) that provides detailed information on voter registration deadlines, absentee ballot deadlines, and early voting dates for each state.
  • Vote.org (link) lists absentee ballot deadlines for all states, specifying the exact requirements for when ballots must be received or postmarked.
    
• An estimated 12,000 people attended the 36th annual World Pork Expo — the world’s largest pork industry-specific trade show — at the Iowa State Fairgrounds in Des Moines June 5-6. The confab included an NPPC policy panel where its board officers and staff experts discussed the pork industry’s current legislative, regulatory, legal, and trade priorities. Among the topics covered were the 2024 Farm Bill, California Proposition 12, agricultural labor, an enhanced swine traceability system, international trade, and foreign animal disease preparation and prevention.|
  

Left to right: Chip Flory from Farm Journal Media and AgriTalk (public policy panel host), NPPC CEO Bryan Humphreys, NPPC President Lori Stevermer, NPPC Assistant Vice President of Domestic Policy Chase Adams, NPPC Vice President of Government Affairs Maria Zieba, and NPPC Director of Animal Health Dr. Anna Forseth. Picture source: NPPC

• April pork exports largest in nearly three years; beef exports also trend higher. April exports of U.S. pork reached the highest volume and value since May 2021, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). It was also a robust month for U.S. beef exports, which were the largest in 10 months and valued at just under $900 million. USMEF President and CEO Dan Halstrom has details in this audio report.
  
• Record shipments to Mexico bolster April pork exports. Fueled by a record performance in leading market Mexico and broad-based growth in several other regions, pork exports totaled 277,910 metric tons (mt) in April, up 14% from a year ago and the fifth largest on record. Export value climbed 18% to $778.8 million, the third highest on record. For January through April, exports increased 8% to 1.04 million mt, valued at $2.89 billion — up 10% from last year’s record pace.
  

Pork export value in April equated to $72.46 per head slaughtered, up 7% from a year ago and the third highest on record. The January-April average was $66.28, also up 7% from a year ago.

• Mexico also shines for beef exports; demand improving in Japan. April beef exports totaled 111,580 mt, up slightly from a year ago and the largest since June 2023. Export value increased 5% to $898.7 million, also the highest since June. Shipments to Mexico reached the highest value in more than three years, topping $120 million. Despite a weak yen and other headwinds, April beef exports also trended higher to Japan through the first four months of 2024, beef export value increased 5% year-over-year to $3.38 billion, despite a 3% decline in volume (423,445 mt).
  
• Catering to new demand, how the pork industry now has a plan to win over Millennials and Gen Z. AgWeb has an article (link) by Tyne Morgan that notes new research from the National Pork Board shows there are more air fryers in homes across America than there are coffee makers, which means younger generations cook meals with appliances baby boomers may not even own.
  
• Judge grants injunction against USDA’s ERP, bans race and sex discrimination in payments. A federal judge in Amarillo, Texas, recently granted a preliminary injunction against USDA regarding the 2022 Emergency Relief Program (ERP). This injunction allows payments to continue but prohibits discrimination based on sex or race. The judge’s decision was influenced by the likelihood that the plaintiffs would prevail on the merits of their case, which challenges the constitutionality of USDA’s methodology for distributing aid under the ERP. More details on this in The Week Ahead (link).
  
• On the election front:
• • France and Germany lead swing to right in EU elections, exit polls show. Far-right parties have made significant gains in the EU elections, winning the vote in France and performing well in Germany and other countries, in results that will help tilt the European parliament towards a more anti-immigration and anti-green stance. Link to more via the Financial Times.
  • Macron dissolves French parliament and calls snap elections.
  • Italy’s Meloni wins EU vote as far-right gains across the bloc.
  • Euro takes a hit on the European elections.
  • Modi sworn in as India prime minister after election setback.
  • Donald Trump leads Joe Biden nationally among likely voters, 50% to 49%, in a new CBS/YouGov poll. But in battleground states, those numbers are flipped: Biden bests Trump, 50% to 49%. Both leads are well within the 3.8-point margin of error.
    
• Other quick takes:
• Supreme Court will issue some rulings on Thursday
• Netanyahu’s chief rival quits Israeli gov’t to try to topple it
• Virginia canceled its plan to adopt West Coast vehicle standards
• Wyoming is the 10th state where bird flu has infected dairy cows
• Saudis said to hand about 60% of Aramco offer to foreigners
• Gantz quits Israel government after PM fails to meet demands
• Blinken returns to Mideast as U.S. presses stalled cease-fire plan