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Wednesday, September 27th, 2023 Video and Audio Program

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We saw the wheat markets under pressure on Wednesday while corn, soybeans, soybean oil, crude oil and the U.S. dollar moved higher. Between the economic headwinds, USDA’s Friday reports and many other factors; there is a lot to unpack that is impacting our grain and livestock trade. We discuss today with Mike Zuzolo from Global Commodity Analytics. Learn more online by visiting https://www.globalcommresearch.com.

Today’s program is brought to you in part by Growmark/FS; learn more online at https://www.fssystem.com.

AUDIO ONLY SHOW LINKS:

https://podcasts.apple.com/us/podcast/market-talk/id1533318516?i=1000629429689

Government Shutdown, Original Farm Bill Deadline Looming

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The end of September marks two important deadlines for Congress: the deadline to pass a new farm bill and the deadline to fund the federal government.

American Farm Bureau Federation Executive Vice President Joby Young says farmers and ranchers will immediately notice the impact of a potential government shutdown.

“When farmers and ranchers look at it, they’re going to think about USDA and USDA programs,” according to Young. “And so, that could be everything from your farmer facing programs like your FSA offices and NRCS offices, and places where there might be furloughed employees. And then there are certain entire programs that have to cease operations during the course of a government shutdown, loan programs and some other things that can be affected.”

Young says consumers will notice a few changes, as well, should a shutdown occur.

“There are some things that are exempted from a government shutdown, protection of property, protection of human life, some of the food safety inspections and other things might fall into those categories,” says Young. “But USDA programs certainly are one of those areas that can have complications and can be hindered by a government shutdown. Agencies that do nutrition programs and other things are affected during a government shutdown, as well.”

While a government shutdown would impact farmers and consumers more quickly, it’s important for Congress to remember that farm bill expiration would have implications as well. Young says, “That’s a very complex picture, of course. The government shutdown clearly is a much more immediate impact. A farm bill expiration, a little bit more flexibility there because the programs that are under the farm bill across many agencies have a variety of expiration dates. But none of this is ideal, and they’re all certainly things that you don’t want to see. And so, that’s why it’s important to both resolve the government funding debate because of its immediate effects, but also quickly move on to consideration of a farm bill and avoid any of the negative effects that might come from that.”

Vilsack Outlines USDA Shutdown Impacts

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USDA Secretary Tom Vilsack says a government shutdown would be “incredibly disruptive” to millions of Americans, including farmers, USDA staff, and needy families.

SNAP food stamp benefits would stop after a month, the Women, Infants and Children or WIC nutrition program would end immediately. As for farmers, Vilsack says, “Now is the time when farmers are harvesting their crops, and they’re seeking marketing loans, which allow them and assist them in ensuring that they get a decent price for their crop. When we have a shutdown, Farm Service Agency offices in virtually every county in this country shut down, and those loans are not available.”

Secretary Vilsack says other USDA agencies are also in every county; “It’s Rural Development offices, it’s NRCS conservation employees, it’s some of the forest service employees, it’s a lot of the researchers and people who work for the Agricultural Research Service, ARS.”

And administrative staff, without which Vilsack says anyone still working, can’t get their job done.

Meantime, Texas A & M Extension Economist Joe Outlaw told a Farm Foundation Zoom panel discussion, things are a mess for doing a farm bill this year.

“If there is compromise, you may lose the Speaker of the House, if there is compromise, there are going to be people who are unhappy,” according to Outlaw. “The debt ceiling deal passed earlier this year put everything behind the ‘eight ball’ in terms of getting the farm bill done. When I saw the outcome of the debt ceiling, I said I didn’t think we’ll get a farm bill done for a couple of years—I still stand by that.”

He added the appropriations standoff in the House, threatening a government shutdown, isn’t helping a farm bill either.

USDA Expands Access to School Breakfast and Lunch

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The Department of Agriculture Tuesday announced it is giving an estimated 3,000 more school districts in high-need areas the option to serve breakfast and lunch to all students at no cost.

The expansion is possible through the Community Eligibility provision, commonly known as CEP. Agriculture Secretary Tom Vilsack says the effort “Will decrease childhood hunger, improve child health and student readiness, and put our nation on the path to better nutrition and wellness.” CEP is a simplified meal service option that allows schools to provide meals at no cost to all students without requiring families to apply for free and reduced-price meals.

School districts receive federal funding based on a formula using existing data, and local or state funds must fill any gap between program costs and federal support. Previously, at least 40 percent of students had to live in households participating in federal assistance programs for a school or school district to be eligible for CEP. This final rule lowers that threshold from 40 percent to 25 percent.

Report: Organic Strawberries Bring Higher Prices

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New data from USDA’s Economic Research Service shows organic strawberries offer growers higher prices than conventional strawberries. Fresh strawberry prices tend to exhibit strong seasonal trends partly because of their relatively short shelf life.

In the United States, grower prices for fresh organic strawberries move in tandem with conventional strawberry prices throughout the year while also typically running 40 to 50 percent higher than conventional prices—this difference is known as a price premium. In late fall and throughout winter, supply wanes even though demand remains robust. During this period, grower price premiums for organic strawberries rise above typical levels.

From 2018–2022, the highest average price premium was in January, when organic strawberry prices were 74 to 88 percent higher than conventional strawberries. Price premiums in July averaged 18 to 24 percent. Since 2008, domestic organic strawberry acreage has tripled in California, which provides about 75 percent of U.S. organic strawberry production.

USDA Report Details Cold Storage Food Supply

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USDA’s September Cold Storage Report shows lower dairy and meat supplies and seasonally higher frozen fruit and vegetables.

The report released this week shows total natural cheese stocks in refrigerated warehouses on August 31, 2023, were down slightly from the previous month but up one percent from August 31, 2022. Butter stocks were down 12 percent from last month but up four percent from a year ago. Total frozen poultry supplies were down slightly from the previous month, but up one percent from a year ago, and total pounds of turkey in freezers were up two percent from last month.

Frozen fruit stocks were up six percent from last month but down two percent from a year ago, while frozen vegetable stocks were up 18 percent from last month and five percent from a year ago. Finally, red meat supplies in freezers were up one percent from the previous month but down 15 percent from last year.

Lawmakers Seek Action on Wildland Firefighter Pay Reform

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A group of Senators called on Senate Majority Leader Chuck Schumer to consider wildland firefighter pay reforms. Led by Colorado Democrat Michael Bennet, the lawmakers seek advancement of permanent, comprehensive pay reform for the country’s wildland firefighters as temporary pay increases are set to end.

Short-term pay increases for over 22,000 federal firefighters will run out this week unless Congress takes action. In a letter, the senators note the increasing threat posed by wildfires in the U.S. and issues that have contributed to firefighter recruitment and retention challenges in recent years – including low pay, unaffordable housing, and strain on their mental health.

The lawmakers say, “Firefighters deserve fair pay, support for their mental and physical health, and time to recover from their dangerous work.” They conclude by urging Schumer to move forward on permanent, comprehensive pay reform in line with the President’s Budget Request for Fiscal Year 2024 and the Wildland Firefighter Paycheck Protection Act.

NOAA Providing Funding for Tribal Lands Drought Resiliency

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The National Oceanic and Atmospheric Administration this week announced funding to support drought resilience on tribal lands. NOAA is providing the funding to support projects that will help tribal nations address current and future drought risk.

Commerce Secretary Gina Raimondo says, “Enhancing drought resilience with tribal partners in the West is a crucial step in building a Climate-Ready Nation.” Proposals may request funding of up to $700,000 total to be disseminated in the first year and expended over three years in the form of cooperative agreements. A total of 3-5 projects may be funded depending on the project budget requested. Applications should be developed by or in full partnership with tribal nations to fund the implementation of activities that address current and future drought risk in the context of a changing climate on tribal lands across the Western U.S.

The NOAA Climate Program Office’s National Integrated Drought Information System anticipates a funding allocation of approximately $2 million, pending the availability of funds in Fiscal Year 2024.

USTR Visits North Carolina Turkey Farm

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U.S. Trade Representative Kathrine Tai visited a North Carolina Turkey Farm Tuesday, celebrating recent market access wins for U.S. agriculture in India.

Tai joined North Carolina Governor Roy Cooper for a tour of North Carolina State University’s Talley Turkey Education Unit, and participated in a roundtable event with turkey producers. Earlier this month, the U.S. and India reduced tariffs on frozen turkey, frozen duck, fresh blueberries and cranberries, frozen blueberries and cranberries, dried blueberries and cranberries, and processed blueberries and cranberries. The effort will give North Carolina farmers and agriculture producers greater opportunity to reach India’s large, untapped market for turkey exports.

North Carolina is one of the United States’ largest exporters of turkey, accounting for about ten percent of U.S. turkey exports to the world each year. From 2017 through 2022, North Carolina averaged $50 million in annual exports of turkey products to the world. From 2017 through 2022, the U.S. exported over $3.1 billion of turkey to the world.

Tuesday, September 26th, 2023 Video and Audio Program

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Grain markets were quiet again on Tuesday as we seemed to gravitate close to unchanged for the whole session. The cattle markets had a rough day overall as economic headwinds seemed to be the biggest factor limiting movement in the ag markets on the day. We discuss the trade action with AgMarket.net’s Jacob Burks on today’s show. Learn more at https://www.agmarket.net.

Also, we talk in Segment Four with Brevant Seeds Retail Product Agronomist Jason Welker about harvest progress in Nebraska and more. Find more details at https://www.brevant.com.

Today’s program is brought to you in part by Growmark/FS; learn more at https://www.fssystem.com.

AUDIO ONLY SHOW LINKS:

https://podcasts.apple.com/us/podcast/market-talk/id1533318516?i=1000629243368