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Low water levels force barge restrictions on Mississippi River... A lack of rain has led to reduced barge draft and tow sizes along the Mississippi River System, causing delays and groundings near Hickman, Kentucky, according to USDA’s Grain Transportation Report. Dredging efforts are underway to prevent further disruptions. Grain transport along the river has fallen below last year’s levels and the seasonal average. Tow sizes have been cut by up to 46% in sections between Cairo, Illinois, and the Gulf. Transit delays of two to three days are expected, with no immediate improvement in water levels predicted over the next two weeks.
Winter wheat drought footprint continues to spread, intensify... As of Oct. 22, the Drought Monitor showed 79% of the U.S. was covered by abnormal dryness/drought, up one percentage point from the previous week. USDA estimated 58% of the U.S. winter wheat crop was experiencing drought conditions, up six points from last week and nine points above year-ago at this time.
In HRW areas, dryness/drought covered 98% of Kansas (2% D3, no D4), 56% of Colorado (2% D3, no D4), 90% of Oklahoma (34% D3, no D4), 90% of Texas (13% D3 or D4), 100% of Nebraska (1% D3, no D4), 100% of South Dakota (6% D3, no D4) and 86% of Montana (14% D3 or D4).
In SRW areas, dryness/drought covered 94% of Missouri (6% D3, no D4), 84% of Illinois (no D3 or D4), 96% of Indiana (no D3 or D4), 81% of Ohio (20% D3 or D4), 99% of Michigan (virtually no D3, no D4), 11% of Kentucky (no D3 or D4) and 60% of Tennessee (virtually no D3, no D4).
USDA will release its first national winter wheat crop condition ratings next Monday. Based on this data, the rating will be below year-ago and average.
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Feedlot supplies expected to be slightly below year-ago... Analysts expect USDA’s Cattle on Feed Report on Friday afternoon to show the large feedlot (1,000-plus head) inventory down 0.3% from year-ago at 11.545 million head as of Oct. 1, which would be the first year-over-year decline since June. The report is expected to show a 4.0% decline in the number of cattle moved into feedlots last month, while marketings are anticipated to be up 2.0% from September 2023.
| Cattle on Feed | Avg. Trade Estimate (% of year-ago) | Range(% of year-ago) | Million head |
On Feed on Oct. 1 | 99.7 | 99.1 – 100.1 | 11.545 |
Placements in September | 96.0 | 94.2 – 99.0 | 2.118 |
Marketings in September | 102.0 | 98.1 – 103.4 | 1.696 |
U.S. confirms two human H5N1 cases in Washington state... Health officials confirmed two human cases of H5N1 in poultry farm workers in Washington state, with results awaited on two more presumptive positive cases. All of the 29 confirmed U.S. human cases of H5N1 except one in Missouri have been among farm workers who had contact with infected poultry or dairy cows. Officials say there has been no human-to-human spreading of the disease to date.
FDA approves continued use of animal feed ingredients after MOU with AAFCO expires... FDA issued final guidance allowing the continued use of animal feed ingredients that were previously approved under a now-defunct Memorandum of Understanding (MOU) with the Association of American Feed Control Officials (AAFCO). This MOU, in place since 2007, facilitated the collaboration between the FDA and AAFCO in reviewing and defining animal feed ingredients. However, the MOU expired on Oct. 1 and will not be renewed.
Key points of the new guidance:
· FDA stated that it does not plan to initiate enforcement actions against the use of ingredients that were defined and listed in the 2024 AAFCO Official Publication (OP), even if they are not approved as food additives or generally recognized as safe (GRAS). This means that manufacturers can continue using these ingredients as long as they adhere to the intended use, specifications and limitations outlined in the AAFCO OP.
· With the expiration of the MOU, FDA has introduced a new Animal Food Ingredient Consultation (AFIC) process. This interim process allows firms to engage with FDA regarding new ingredient reviews that would have previously gone through AAFCO. The AFIC aims to provide a pathway for firms to consult with the FDA about new ingredients and involves public input on safety concerns.
· FDA is actively seeking comments from industry stakeholders on its pre-market animal food review processes, including the Food Additive Petition (FAP) and GRAS programs. These comments will help determine if changes are needed to improve these pathways.
Despite the end of the MOU, FDA plans to continue working with AAFCO and state regulators to ensure animal food safety. The agency will still participate in AAFCO committees and meetings.
Mexico’s food and agriculture plan: A return to the 1980s... Mexico’s President Claudia Sheinbaum announced a new agriculture plan aimed at reviving the country’s food production and distribution systems to resemble those of the 1980s. This initiative focuses on staples such as tortillas, beans, instant coffee and hot chocolate, which were commonly purchased from government stores offering basic goods. Sheinbaum emphasized the importance of “food sovereignty,” with a primary goal of increasing domestic bean and corn production.
Agriculture Secretary Julio Berdegué outlined plans to guarantee prices for corn farmers to stabilize tortilla prices, which have surged in recent years. The government aims to increase bean production by 30% over six years to reduce imports and plans to establish research centers for higher-yielding bean seeds. The plan also includes support for coffee production, focusing on instant coffee, which is reportedly used by 84% of Mexican households. Additionally, it seeks to bolster cocoa production for powdered baking and hot chocolate rather than fine chocolate bars.
Bean consumption has significantly declined, with Mexicans now consuming less than half the amount they did in 1980. Tortilla consumption has also decreased, with many consumers opting for bread and other bakery products. The policy challenges include shifting consumer habits and addressing market trends favoring high-value chocolate varieties over cheaper alternatives. Although instant coffee remains a staple in many households, consumer spending trends favor other coffee types.
Sheinbaum’s policies reflect a continuation of her predecessor Andrés Manuel López Obrador’s focus on self-sufficiency in oil, energy and foodstuffs.