Pentagon Tracking Suspected Chinese Spy Balloon Flying over Parts of U.S.

Will President Biden mention new farm bill in Tuesday State of the Union address?

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February 03, 2023 06:19 AM

Will President Biden mention new farm bill in Tuesday State of the Union address?

In Today’s Digital Newspaper

An abbreviated format today. Following a presentation earlier this week in Springfield, Illinois, at an Illinois Farm Credit meeting, I am now in beautiful Bath, North Carolina — the state’s first town and port of entry, it was chartered on March 8, 1705. Later this morning I will talk at a meeting in Plymouth, N.C., being put on by always friendly Jimmy Latham and Rod Gurganus, Beaufort County Extension Director, North Carolina State University.

Equities: Global stock markets were mixed overnight. U.S. stock indexes are pointed toward lower openings. Key financial focus today is the Employment report. Economists are expecting a slowdown – 187,000 jobs added vs. 223,000 in December – as well as slight growth in the unemployment rate and an easing in wage increases.

On Thursday, gains in tech shares kept the Nasdaq and S&P 500 solidly in positive territory while the Dow was unable to poke higher during the day. The Dow ended down 39.02 points, 0.11%, at 34,053.94. The Nasdaq gained 384.50 points, 3.25%, at 12,200.82. The S&P 500 was up 50.55 points, 1.47%, at 4,179.76.

Key outside markets today see the U.S. dollar index weaker. Prices Thursday hit a nine-month low. Nymex crude oil futures prices are a bit weaker and trading around $76.75 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 3.392%.

Mortgage rates fall again. Mortgage rates edged lower for a fourth straight week. The average rate on the popular 30-year fixed mortgage fell to 6.09%, the lowest level since mid-September, according to a survey of lenders released Thursday by mortgage-finance giant Freddie Mac. Mortgage rates were around 3.5% a year ago, before the Federal Reserve started an aggressive campaign to tame high inflation. Mortgage rates aren’t directly tied to Fed rate increases but tend to loosely follow the 10-year Treasury yield, which moves based on expectations for the economy.

FAO global food price index drops again. The U.N. Food and Agriculture Organization (FAO) global food price index dropped for the tenth straight month in January and was 17.9% below the March 2022 peak. The January decline was driven by a drop in prices of vegoils, dairy and sugar, while cereal grains and meat remained largely stable. Compared to year-ago, prices were up 1.3% for meat, 2.7% for dairy, 4.8% for cereal grains and 2.8% for sugar, while vegoils dropped 24.5%.

Ag trade: Egypt purchased 535,000 MT of wheat — all expected to be sourced from Russia. Taiwan tendered to buy 48,100 MT of U.S. milling wheat.

Energy Department asks to halt additional oil reserve sales. The Energy Department is asking Congress to halt the sales of 26 million more barrels of oil from the nation’s emergency supply of oil mandated for this fiscal year as it seeks to refill the Strategic Petroleum Reserve.

More soybean, cotton sales to China. Weekly export sales data for the week ended Jan. 26 showed additional sales of several U.S. ag commodities to China, including soybeans, cotton, corn and sorghum. Net sales activity for 2022-23 included 319,452 tonnes of corn, 53,000 tonnes of sorghum, 782,402 tonnes of soybeans, and 119,790 running bales of upland cotton. Sales of 60,000 tonnes of soybeans for 2023/24 were also reported. Net sales for 2023 included 4,288 tonnes of beef and 453 tonnes of pork.

China:

IMF: China must speed up reform to offset population, productivity issues. China must make reforms to keep state firms competitive, continue opening up and gradually lift the retirement age if it wants to maximize its growth potential, the International Monetary Fund (IMF) says. Rule of thumb: When China’s growth rate rises by 1 percentage point, growth in other countries increases by around 0.3 percentage points, according to recent IMF staff analysis. That underscores how domestic reforms could boost China’s economy and that of others too.
China has continued to expand trade with Russia, opening — for the first time — two permanent bridges to facilitate trade over a key border river and drumming up a record 1.28 trillion yuan ($190 billion) last year, according to Chinese data released last month. That marked an increase of around 30% from 2021.
Chinese spy balloon spotted in American skies, Pentagon says; U.S. weighed shooting it down. The decision not to shoot down the balloon (which is the size of three buses) was made because of concerns that debris could injure Americans on the ground or destroy property, according to a senior Defense Department official who briefed reporters on condition of anonymity. The balloon was over Montana (home to one of three U.S. nuclear missile silo fields) when the U.S. considered destroying it, the official said. It would be shot down if it posed a threat to civilian aviation, the official said. It is floating at an altitude where those planes do not fly. The balloon is designed for surveillance, the official said. However, it likely is unable to collect more information than is available to spy satellites.
U.S. Secretary of State Antony Blinken is headed to Beijing for a two-day visit which will reportedly include a meeting with Chinese leader Xi Jinping.

The Biden administration is expected to announce a new Ukraine security package worth approximately $2.2 billion that includes longer-range missiles for the first time. The type of missiles included in the package will effectively double the range of Ukrainian weaponry, officials say, reaching a range of approximately 90 miles. This will be the first security package since the U.S. committed to providing Ukraine with advanced M-1 Abrams tanks in January, a decision made in coordination with European countries providing German-made Leopard 2 tanks. The weapons will not arrive in Ukraine immediately, since they will not come directly out of US inventories. Instead, the US will contract with weapons manufacturers — a process that could take weeks or months while the war drags on.

Ursula von der Leyen, president of the European Commission, arrived in Kyiv for meetings with Volodymyr Zelensky, Ukraine’s president, about his country’s EU accession bid. European officials will also discuss imposing new sanctions on Russia. Meanwhile, on a visit to Volgograd (formerly Stalingrad), scene of a desperate Russian victory against the Nazis 80 years ago, Vladimir Putin promised to again repel German tanks in Ukraine.

Firm cuts Russia’s 2023 wheat crop forecast. Agriculture consultancy IKAR has cut its forecast for Russia’s 2023 wheat crop by 3 MMT to 84 MMT due to weather issues in some areas. Dryness is a rising concern in southern areas of Russia, while issues with ice crusting and potential winterkill in central production areas.

Farm policy update:

Senators reintroduce cattle market bill, but the same hurdles prevail. Sens. Chuck Grassley (R-Iowa), Deb Fischer (R-Neb.), Ron Wyden (D-Ore) and Jon Tester (D-Mont.) and 18 other cosponsors on Thursday introduced the bipartisan Cattle Price Discovery and Transparency Act of 2023. The legislation would establish regional cash minimums and equip producers with more market information, including permanently authorizing a cattle contract library. NCBA opposes the measure while it is supported by the U.S. Cattlemen’s Association. Upshot: Hurdles for the measure are evident in both the House and Senate.
GOP introduces WOTUS resolution of disapproval in Senate, House. The resolutions of disapproval of the Biden administration’s Waters of the United States (WOTUS) rule will not likely have the votes in the Senate and even if it did, President Biden would veto the Congressional Review Act resolution and there would not be enough votes to override.
Senate Ag hearing next Thursday to include several USDA officials. The witness list includes USDA Undersecretary for Farm Production and Conservation Robert Bonnie; Risk Management Agency Administrator Marcia Bunger; and Farm Service Agency Administrator Zach Ducheneaux.
President Biden will give the State of the Union address Tuesday. One topic of interest will be whether the president includes inking a new farm bill as one of the bipartisan measures that could be concluded this year.

Biden economic adviser Deese to step down, with no successor yet. President Biden announced Thursday that Brian Deese — his top economic aide, who has helped steer the White House’s top regulatory and legislative efforts — would step down as director of the National Economic Council. Deese is expected to leave the administration in mid-February, according to a White House official.

Freeport LNG seeks permission to restart ship loading. Freeport LNG, a key U.S. liquefied natural gas export terminal that’s been shuttered since an explosion last summer, is seeking permission in a letter Wednesday to the Federal Energy Regulatory Commission to restart some shipping activities as it moves closer to a long-delayed full reopening.

Rep. Ilhan Omar ousted from key committee. The House voted Thursday on party lines to oust Democratic Representative Ilhan Omar of Minnesota from the House Foreign Affairs Committee. The move came over previous comments she made about Israel that members of both parties viewed as antisemitic. Republican leaders have threatened to take action against Omar over several controversial statements she’s made since she came to Capitol Hill in 2019.

Cotton AWP edges higher. The Adjusted World Price (AWP) for cotton is at 75.24 cents per pound, effective today (Feb. 3), up slightly from 75.05 cents per pound the prior week and the second straight week the AWP has been above 75 cents per pound. The AWP has not below the level (52 cents per pound) that would trigger an LDP since Oct. 9, 2020.

Global cases of Covid-19 are at 671,349,929 with 6,838,289 deaths, according to data compiled by the Center for Systems Science and Engineering at Johns Hopkins University. The U.S. case count is at 102,541,976 with 1,110,856 deaths. The U.S. Centers for Disease Control and Prevention said that there have been 668,814,259 doses administered, 268,927,705 have received at least one vaccine, or 81.0% of the U.S. population.

NWS weather outlook: Temperatures will be 15 to 35 degrees below average over parts of the Upper Mississippi Valley, Great Lakes, Ohio Valley, and the Northeast... ...Lake-effect snow downwind from the Great Lakes... ...Snow over parts of the Cascades, Sierra Nevada Mountains, and the Northern Rockies.

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