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Your Pro Farmer newsletter is now available... USDA’s Acreage and Grain Stocks Reports have a history of creating big market moves and this year was no different. We highlight USDA’s planted and harvested acreage estimates on News page 4, while the breakdown of June 1 grain stocks are on the front page of the newsletter. In the wake of the heavy flooding in the northwestern Corn Belt, there have been a lot of questions about USDA’s methodology for assessing crop conditions. We have the answer straight from the head of field crops at NASS. USDA’s Hogs & Pigs Report showed the U.S. hog herd expanded slightly more than anticipated as of June 1 due to a bigger market hog inventory, which suggests slaughter will run ahead of year-ago into early 2025. The Cattle on Feed Report showed the number of calves placed into feedlots unexpectedly rose in May. The Cold Storage Report showed beef and pork stocks declined less than normal in May, suggesting demand didn’t keep pace with supplies. We cover all of these items and much more in this week’s newsletter, which you can access here.
Bearish reaction to USDA’s corn data... USDA’s June 1 corn stocks and planted acreage estimates came in higher than anticipated, triggering a sharp bearish reaction. Not only are there more old-crop supplies to work through, but the new-crop production outlook is now perceivably bigger. Wheat futures followed corn to the downside, despite lower-than-expected acres, as June 1 stocks topped expectations. June 1 soybean stocks were basically neutral while, plantings unexpectedly declined from March intentions. But soybeans could fight off the negative headwinds from corn and wheat. Click here to view our report reaction.
SCOTUS overturns Chevron doctrine, limiting federal regulatory power... The Supreme Court overturned the Chevron doctrine, established in 1984, which had directed courts to defer to federal agencies’ reasonable interpretations of ambiguous laws. The ruling is expected to have far-reaching implications for federal regulations across various sectors, including environmental protection, public health, workplace safety, and consumer protections.
Bottom line: This ruling represents a significant shift in administrative law and is likely to have broad impacts on how federal agencies interpret and implement laws passed by Congress. It may lead to more challenges of agency regulations in court and could potentially slow down or complicate the regulatory process across various sectors of government.
The ag and energy sectors are asking how this ruling could impact energy and environmental regulations. Biofuel interests are wondering if this will impact the Renewable Fuel Standard (RFS) program. Given that EPA has more leeway to set RFS levels without the mandates in law, it could. But the RFS levels have been challenged before and the resolution takes a long time, so it really doesn’t affect the mandates, i.e., the 2023 standards included 250 million gallons to meet a court remand of the 2016 standards.
Of note: The Supreme court ruling said decisions made previously that relied on Chevron would not be subject to review.
SovEcon cuts 2024-25 Russian grain export forecasts... Black Sea ag consultancy cut its 2024-25 Russian wheat export forecast to by 1.7 MMT from its prior outlook to 46.1 MMT, reflecting a smaller expected production. That would be down from shipments 52.2 MMT for 2023-24. Total grain and pulses exports in 2024-25 are projected at 56.0 MMT, down from 70.4 MMT in 2023-24. Barley exports are forecast at 3.1 MMT compared to 7.0 MMT in 2023-24. Corn shipments are seen at 3.6 MMT, down from 6.9 MMT.
Russia takes steps to cut grain export duties, support farmers... Russia’s government said grain export duties will decline by around 700 rubles ($8.12) per metric ton on average as it raises prices for tax calculations. It said the export prices for duty calculation were increased by 1,000 rubles per metric ton on average for wheat, meslin barley and corn.
Russia: BRICS countries back grain exchange idea... The BRICS group of countries have supported an initiative to set up an agricultural exchange, Russian Minister of Agriculture Oksana Lut said. The exchange would allow buyers to purchase directly from producers.
The BRICS group, which includes Brazil, India, China and South Africa among others, accounts for more than 30% of global agricultural land, according to Russian export center Agroexport. It also accounts for more than 40% of global cereal and meat production, nearly 40% of dairy products and more than 50% of total fish and seafood production.
Boozman writes farm bill op-ed... Sen. John Boozman (R-Ark.), ranking member on the Senate Ag Committee, wrote an opinion piece published in the Arkansas Democrat-Gazette outlining how the Senate Republican efforts to put more farm in the farm bill will help farmers in Arkansas and across the country. Key takeaways:
- The input of farmers and ranchers must be the foundation for laws that impact their operations, particularly when Congress renews our five-year contract with them known as the farm bill. It’s the ideas of those on the front lines in the state and around the country that serve as the backbone for the framework Senate Republicans recently announced.
- Net farm income is expected to decline in Arkansas this year, down nearly 30% from two years ago, deterring some operations from even trying to continue. We must reverse this trend by providing the next generation of producers with increased certainty and predictability so farm families can continue to feed and clothe the world.
- Bolstering the farm safety net by increasing reference prices and through updates to risk-management tools, including first-time access for poultry farmers, relief for catfish growers suffering losses due to predation, and enhanced crop insurance coverage for all farmers, are meaningful improvements that reflect the diverse challenges facing agriculture producers.
- Research discoveries at our state’s colleges and universities are critical to innovation on the farm. Our proposal doubles agricultural research funding and guarantees continuation of the 1890 Scholars Program that would directly impact research institutions like the University of Arkansas at Pine Bluff.
- Finally, the Senate GOP framework creates rural communities that the next generation choose to call home. In the last census, more than half of our 75 counties lost population. This Farm Bill proposal grows job opportunities and invests in economic development, broadband expansion, water infrastructure projects, and rural childcare and health care to retain and attract families who call these areas home.
Soyoil use for biofuels rises in April... Soybean oil used to produce biofuels in the U.S. increased to 1.070 billion lbs. in April, up from 1.026 billion lbs. the previous month, according to the Energy Information Administration. That was up 15.4% from April 2023 and the highest figure since December. April soyoil usage included 505 million lbs. by biodiesel plants and 565 million lbs. by renewable diesel facilities. That was the highest usage rate for renewable diesel plants since September 2023.
USDA publishes proposed livestock/poultry fair competition rule... USDA’s Agricultural Marketing Service (AMS) published a proposed rule on Fair and Competitive Livestock and Poultry Markets in the Federal Register, initiating a 60-day comment period ending on August 27. The rule has garnered both criticism and praise within the U.S. agriculture industry. During the Office of Management and Budget (OMB) review, there were four meetings held — two with groups opposing the rule and two with those supporting it. The forthcoming comments are expected to reflect the issues raised during these meetings.