The last few weeks of August brought a lot of announcements of new investments in infrastructure.. Showing that, at least for now, the agriculture market doesn’t seem to be slowing down, on the national stage. As Labor Day passes and harvest season inches closer, the agriculture community seems to be holding their breath, waiting to see how the harvest turns out. Even though there is some concern over drought emerging in the Corn Belt and the risk of frost, most seem optimistic about it.
Three men apparently stole a 1975 Ford grain truck from a private residence in Lincoln County, MO, right outside of St Louis. They simply drove the truck through a wall of the building it was housed in.. Though it is unclear who, one of the men drove the truck off the road and subsequently set it on fire. Mitchell Houston and Adam Bote had previously been arrested and admitted to the burglarizing and stealing, but both blamed the other for setting the truck ablaze. Zachary Hill was arrested about a week after the other two men. All three are charged with burglary, two-counts of tampering with a motor vehicle and property damage. Hill and Bote are also charged with knowingly burning. The bail is set for $75,000 for Hill and Bote, and $100,000 for Houston.
CHS Inc. and Dakota Plains Cooperative have taken the first steps towards a merger by seeking their respective boards of directors to approve it. This merger will help CHS inc. meet its goal of enhancing its agronomy assets in east and central North Dakota. Those plans also include the possibility of building three new fertilizer plants in the Dakota Plains Cooperative trade area in order to take advantage of a fertilizer manufacturing plant in Spiritwood, ND.
The Canadian Pacific is close to selling the western part of Dakota, Minnesota and Eastern Railroad. They have reported four to five interested parties and are reportedly close to making a deal. South Dakota grain elevators fear the possibility that the rail will be sold to a short-line railroad. If sold to a short-line, who would have to make a deal with The Canadian Pacific for access to an international network, it could mean that there would only be one way out. This could mean an increase in rates for the elevators that use the railroad.
Pilgrim’s Pride is investing a total of $25 million in its Alabama operations. The plan includes building a $15 million feed mill in Pinckard, AL, and $10 million in upgrades to its poultry processing facility in Enterprise, AL. The news came shortly after Pilgrim’s Pride announced it would be closing its facility in Batesville, AR. The mill will begin construction in September and the upgrades will be made over the next six months.
Washington State Grain Inspectors no longer feel safe crossing the International Longshore and Warehouse Union’s picket line at the Port of Vancouver, WA. Reports of threats from the picketers, including an instance where a picketer opened an inspector’s car door in order to scream at them, has caused inspectors to threaten to stop inspections unless the two parties reach a solution by the first week of September, or more steps are taken to ensure their safety. The Pacific Northwest Grain Handlers Association says that grain flow is unlikely to stop because they believe that federal inspectors will be forced, by law, to take over the inspections. The Port of Vancouver claims that they have enough security in place to protect all parties involved. The lockout has been in place since February and though both parties claim that they have tried to resume talks, both say that the other group has been unresponsive.
That’s it for this week. I want to remind you to email me if you have any story ideas, comments on what news you want to hear about, or just to say hey. Subscribe to Industry Watch, follow us on Twitter or like us on Facebook for all the latest news in the industry.
After a night of drinking, Donald Julian Ellis broke into a grain elevator in Page, ND owned by The Arthur Companies. He proceeded to smash up the elevator’s office, throwing around office supplies and furniture before emptying a fire extinguisher over the wreck. Ellis then smashed a grain truck into a concrete slab causing significant damage, but then proceeded to steal another company truck and drive home. Ellis admitted to the acts when confronted by police the next day, as well as being intoxicated while performing the acts of destruction. He claimed that someone the night before had told him to jump off the grain elevator and that he had broken in and caused the damage to “show everyone how big of a man” he was. Donald Julian Ellis is now charged with burglary, theft and criminal mischief felonies as well as one count of unauthorized use of a vehicle.
Tyson banning Zilmax was the top story for the week of the Aug. 12 and has had ripples throughout the meat processing industry. Even though Cargill has stated that it has not had any issue regarding Zilmax, they followed suit and banned the supplement effective Sept. 30. Merck & Co., who manufactures the supplement, suspended the drug pending a scientific audit. Merck &Co. has stated that they have had no experiences like those cited by Tyson as its reason for banning the supplement, but decided to suspend the sale of Zilmax until the allegations are sorted out. Zilmax and similar drugs can add 30 pounds of muscle to cattle, and have been necessary in recent years due to dwindling herds. Tyson banned the supplement after reports of cattle arriving to be slaughtered unable to walk on their own.
The U.S. Department of Labor's Occupational Safety and Health Administration cited Greg Sikes Farm LLC, with six violations totaling $127,400 in proposed fines. This comes after an incident last fall, where an employee became entrapped while trying to remove soybeans jammed in an auger. The violations include:
Two willful violations
Failing to ensure the screw auger is locked out when workers are inside the bin
Provide workers a body harness with a lifeline upon bin entry
Six serious violations
Failing to develop an emergency action plan
Providing annual training on grain handling hazards
Obtaining permits addressing bin entry procedures and requirements
Failing to equip the workers who entered the bin with rescue equipment
Allowing workers to walk on the grain
Not ensuring that an observer was stationed outside during bin entry or was equipped to provide assistance in case of an emergency
For more information on following OSHA bin entry guidelines click here.
Last October, a worker fell into a sweep auger when sweeping a grain bin in preparation for another shipment. The man claims he was taught by his supervisor to merely slow the auger down, rather than turn it off, as required by The U.S. Department of Labor's Occupational Safety and Health Administration. The man sustained injuries to his head, right eye, right arm, right leg, a broken jaw and heavy bruising. The courts found the company at fault and ordered it to pay the worker an additional $26,000 in emotional damages on top of the $20,000 for medical expenses, as well as a $35,000 fine.
Shareholders will now have a date to decide if Shuanghui International Holdings Ltd. will be able to purchase industry giant Smithfield on Sept.24. The merger has gone over many obstacles including concerns from the U.S. Government. The U.S. Securities and Exchange Commission must first approve the sale, a decision expected to be made by Sept. 6.
Well those are the top five. I want to remind you to email me if you have any story ideas, comments on what news you want to hear about, or just to say hey. Subscribe to Industry Watch, follow us on Twitter or like us on Facebook for all the latest news in the industry.
Corn basis improved 3 ¼ cents on average supported by tight stocks and a less dramatic rally in the futures market
Soybean basis dropped sharply, falling 25 cents throughout the country. The explosive rally in the futures market helped increase farmer selling causing grain buyers to back off old crop basis. Corn basis improved 3 ¼ cents on average throughout the country supported by tight stocks and a less dramatic rally in the futures market.
Soybean basis weakened sharply at crush facilities which slipped 35 cents on average throughout the country. Despite a mostly unchanged Gulf basis, river terminals also posted basis declines, dropping on average 18 ½ cents.
Spot corn bids at ethanol facilities improved 4 ¾ cents this week despite a weakening crush margin. Recent rallies in old crop corn futures combined with lower ethanol and DDG prices have cut ethanol margins in Iowa to just $2.04 per bushel, down nearly 50 cents per bushel since the beginning of the month. Tight old crop stocks and lagging new crop maturity should continue to support old crop corn basis throughout September.
Important news for feed and grain industries still trickles through
Early this month I read a blog that said August was a notoriously slow news month. Congress is on summer hiatus, farmers are in the field and it seems like much of the country is taking that last summer vacation before school starts. Going through the headlines this week was a struggle to find relevant information for readers, a job I take seriously. What came out of my search were stories that may not have had gripping headlines, but ultimately may be tremendously important to the feed and grain industries’ present, and may be a look at what its future has in store.
Tyson became the first of the leading four meat companies to ban the supplement Zilmax, used to add about 25 pounds of muscle per cattle carcass. Zilmax is widely used throughout the industry, and this announcement came as a surprise to many producers, who only have until Sept. 6 before Tyson stops accepting cattle fed Zilmax. Experts are concerned about the impact this will have on food prices, especially if the other large meat companies follow suit. Tyson’s official reason for banning the supplement is an increasing amount of cattle being brought to be processed that have difficulty walking, and in some cases are unable to move. Though it is unknown if Zilmax is to blame for this, Tyson's ban has attracted the attention of the FDA, who promised to . Merck & Co. have of the supplement, pending a scientific review of the drug. The reason behind the ban may be less benevolent than it appears, many experts are wondering if Tyson is simply trying to gain a larger share of the export market. Many nations have outlawed many, if not all, drugs used for the production of meat.
Working for Feed & Grain has changed my life in many ways, but one of the most amusing is that as I drive along the Wisconsin country roads, I notice the fields on either side on me. And right now corn seems to be flourishing on one side and abysmal on the other. That’s why I’ve been surprised at every other USDA report. The crop looked good, for the most part, but record breaking? Well, it appears they were right now that they’ve taken farmer survey and field plot measurements into account for the first time this year and are still predicting a record crop. The USDA lowered the estimate a little, but it still looks as if there will be a lot of corn and soybeans being harvested. Now we all have to hope that nature cooperates, and the frost isn’t early this year.
The seemingly high level of grain-related deaths this year, or at least the high profile of those that have happened, has pushed the issue to the forefront of the minds of many first responders in rural communities. Programs dealing with the types of situations that one would encounter in a grain silo are being offered by universities that are active in agriculture. This is a situation that may not have been encountered by many first responders, and one that time is of the essence. Having training beforehand may allow responders to act a few minutes early, and in the case of grain engulfment, a few minutes may be the difference between life and death. This particular course is being offered at Kansas State University, but a reader brought to our attention a similar course being offered at Texas A&M. If you ever have information you wish to share about an article, please feel free to post a comment!
The American Feed Industry Association has contacted the FDA asking whether a HACCP Plan or certification is required under the Food Safety Modernization Act. The FDA responded that the widely accepted HACCP Certification is, in fact, not required, and a facility only needs a hazard identification plan, and a written risk management/preventive controls plan. Though the AFIA still suggests a HACCP plan as the best option, it’s critical that feed facilities know it isn’t a requirement.
Brazil is the United States’ biggest competitor when it comes to corn exports. With infrastructure problems, and acre yields well below their potential, Brazil could foreseeably exceed the United States in production if these problems aren’t addressed. The main reason is Brazil’s ability to produce a second harvest every year, while the Corn Belt is covered with snow for half the year. Since 2000, Brazil has doubled its corn production, and this may not be a terrible thing for the United States. As we all know, by 2050 the population will spike to over 9 billion people, which means there will be a lot more consumers, and with improvements to the yield per acre slowing down in most of the developed world, our best chance to meet the demand might lay in the underdeveloped tropics.
Feel free to email me if you have any story ideas, comments on what news you want to hear about, or just to say "Hey." Subscribe to Industry Watch, follow us on twitter or like us on Facebook for all the latest news in the industry.
The national average corn basis slipped 2 cents this week while soybeans pushed 8 cents higher
Cash market volatility continued this week as tight near-term supplies combined with an outlook for ample production in the coming months keep buyers moving basis erratically. For the week, corn posted an average gain of 2-cents a bushel, while soybeans were up 8 cents on average.
In the corn market, basis levels at the Gulf were higher for the week, but rising barge costs are keeping river terminals steady to even in some cases weaker on basis levels. Barge rates had been climbing in the past two weeks but have started to stall out in recent days. For ethanol, average gains across all plants was 2 cents a bushel for the week, but Western Cornbelt plants had numerous plants with double-digit gains, especially in the Upper Midwest were new-crop corn harvest will likely be late to arrive this year. Weekly ethanol grind was up 4,000 BPD rising for the third straight week in a row.
For soybeans, river terminals were weaker on average, falling 5 cents a bushel on the heels of higher barge freight and a falling Gulf market. For soybean processors, basis levels were mostly weaker but extreme volatility was common across plants as some buyers boosted basis by 20 cents or more while others were dropping basis. The NOPA’s monthly crush report for July showed 161 MB of total crush for US soybean plants, off marginally from the June number of 163 mb.
Fraud, acquisitions, RFS and a petri dish burger round out the list
We are now in the fifth week of the new Views on the News, and things are starting to fall into place. The goal has always been to have Views done on Monday or Tuesday but in past weeks, the realities of the magazine business have kept me short of that goal. Anyone who has missed any past weeks and would like to catch up on the news over the past month, check out the Feed & Grainblog section.
Even though Purdue University statistics have shown agriculture-related fatalities have been declining, grain entrapment has not followed that trend. No one is sure what caused Charles E. Groh to enter the corn silo located on his farm Aug. 5, but he became trapped in it as it was being filled with grain. This seems to be a gruesome summer as far as grain bin-related fatalities are concerned. We’ve covered it in past posts on Views, but also in the Editors View column of Feed & Grain’s August/September issue. All we can do at this point is to send our condolences to Groth’s family and friends, and remind everyone reading this to be careful whenever you enter a grain bin.
We found this story on BND.com, and I touched on this story last week, but here is the full run down. Bob True Beisley III received false scale tickets from a scale operator at Cargill’s facility. Beisley then used those tickets to claim payment for nonexistent shipments of corn. Cargill noticed that the amount of corn in stock didn’t match the amount reported, and tracked down the perpetrators. In all, the scam reportedly cost Cargill $2 million, Beisley being responsible for just over half a million of that total. The defendant has agreed to pay back the money as part of his plea bargain.
Neither side in the Renewable Fuel Standards debate can really call this EPA report a win. It continues the EPA’s stance that ethanol and other renewable fuels are an important part of its goal for the nation’s independence from foreign fuels. They also admitted that the current requirement to steadily increase the amount of ethanol blended into the fuel supply every year is not feasible. They have extended the mixing plant's time to reach their goal by five months. However, most importantly the EPA has vowed to look into the approaching blend wall, the point where it will no longer be possible to add more ethanol to the fuel supply without going past the E10 blend.
Though this hamburger is being touted as one of the solutions to world hunger, it still has a long way to go before it can compete with the livestock industry. The texture is right, but the burger didn’t measure up tothe domestic cow in taste. The patty is grown with bovine stem cells in a dish with a nutritional solution. The patty is naturally yellow but was dyed red with beet juice. The scientists responsible for the experiment say that adding flavor will be simple; they will simply allow some of the stem cells to form into fat cells. The burger cost $330,000 to produce, and was funded by Sergey Brin the co-founder of Google.
The Andersons, Inc. is acquiring Mile Rail LLC in order to increase its ability to repair and clean railcars. Mile Rail is headquartered in St. Louis, but has branches across the Midwest, and The Andersons are looking for ways to expanding their reach as a company. It also adds the ability to repair tank car repair to their repertoire, which will boost the rail care maintenance of The Andersons’ profits by 25%. Other than that, it seems to be a very straight-forward acquisition even though this is the second major acquisition by The Andersons, Inc. in as many weeks.
We had some great stories this week. Email me if you have any story ideas, comments on what news you want to hear about, or just to say "Hey." Subscribe to Industry Watch, follow us on twitter or like us on Facebook for all the latest news in the industry.
There has been a lot happening around the Feed & Grain office over the last few weeks, but there’s always time to reflect on last week's news, most of which focused on cash flow — in terms of benefit payments, business deals and theft.
This scandal couldn’t have come at a worse time for the U.S. Agriculture Department. Auditors say that the USDA paid over $32 million to 4,537 dead farmers. The USDA maintains that the auditors are blowing this out of proportion and that many of those payments were properly made to the descendants of the deceased but were recorded incorrectly. We may never know what really happened, but there is no doubt that this comes at a bad time. Many are misinformed about how farms receive benefits from the current farm bill. Many outside of the agriculture field see it as unnecessary spending. As the recent attempts by the House of Representatives to rein in the EPA shows, there are those in Congress who think that government agencies are out of control, and are looking for any opportunity to cut more out of their budgets. Given the current climate, efforts should be taken to curb these payments, even if the $32 million is only a fraction of the USDA’s $20 billion annual budget.
The Andersons, Inc. and Lansing Trading Group LLC started the acquisition of Thompsons Limited in early June and proceeded with the deal rather quickly. Both companies will own 50% of Thompsons Limited. If you are a customer, it should be business as usual. Thompsons Limited will continue to operate under its own name and serve the same areas. The only real change is that Lansing Trade Group’s trading office in Chatham, Ontario, will be merged with Thompsons.
The GMO debate has gone from stirring under the surface to boiling over in the past few months. New bills requiring labeling are rapidly popping up on the state-level — Illinois is the newest state to wade into the debate, doing so just this week. This is quickly becoming a national issue, and the biotechnology companies are trying to reach out to a population that is turning against GMOs. The well-made website seems to have experts who want to politely give answers to questions. However, this is the Internet, and a polite debate will only last until the first post in the comment section is made.
Our weekend readers must have been catching up on newsletters because this was our top story last week. For some reason, there seems to be a lot of news coming down the pipe about people stealing in agriculture. This week I read about two men who drove off with two trucks full of 50 tons of soybeans and the breaking news lead in Industry Watch’s Aug. 8 edition was about a man who tried to defraud Cargill Inc. out of half a million dollars. With today’s feed and grain facilities employing sophisticated automation systems in their receiving, shipping and billing, it isn’t very likely that these types of crimes will go unnoticed for much longer.
Agriculture is doing well right now, and even with the start of the season getting off to a wet start, the United States is still expected to have a banner year with both corn and soybean crops. And with demand only expected to increase, it makes sense that we see agriculture companies both big and small breaking ground on new projects. This 5-million-bushel shuttle loader/grain elevator will be near Randolph, NE, and is a joint venture between Archer Daniels Midland Company and Central Valley Ag Cooperative. It is expected to be up and running next fall, and who knows, maybe it will be on a future cover of Feed & Grain magazine.
Thanks for reading! Email me if you have any story ideas, comments on what news you want to hear about, or just to say "Hey." Subscribe to Industry Watch, follow us on twitter or like us on Facebook for all the latest news in the industry.
Few can appreciate managing change like you, our loyal Feed & Grain readers. In the more than two decades spent in the industry, I’ve witnessed mergers and numerous expansions into new markets, and through it all, our industry made quality service and a customer-first attitude its top priority.
Using that work ethic as our inspiration, the Feed & Grain team you’ve grown to know — and our new team members you will come to know — promises its continued dedication in serving our industry in many new and exciting ways.
I am excited because we now are part of an organization with a significant footprint in agriculture. Feed & Grain (remember Feed & Grain Times?) was one of the founding trade magazines in a company that, when I launched my career here, generated about 75% of our revenue from magazines related to agriculture.
One of the great things about business, though, is being able to sit at a table with bright people who share focus, knowledge and purpose within a specific market. The Farm Bureau brings that by the railcar load!
I’m looking forward to working with a new team, learning as I go, and leveraging our knowledge so that we can continue to grow and continue to meet or exceed your information needs.
I’ve been asked, of course, if I am nervous. Sure, there’s a bit of anxiety with change. I’ll miss many of the people I’ve shared cubicles and offices with. But the heart of what we do is deliver the information you need, want and value. We help advertisers, exhibitors and sponsors achieve your communications objectives. We bring audiences and those who wish to communicate with you together around a shared information need. This has been our business model for many years and will continue to be now and in the future.
If you have any questions or comments regarding our new ownership under the American Farm Bureau Federation, please don’t hesitate to email me or call (920) 563-1628. I would be happy to hear your feedback.
Good news everyone! The August/September issue of Feed & Grain has been sent off to the presses. You can expect your issue in just a few weeks. For those who don’t get a physical copy of Feed & Grain, the digital edition will be on the website shortly.
I’ve been following this story for months, and every time I bring it up, it elicits the same reaction. “What?” followed by “Who steals corn?” Well, that’s what these three men did. Cody Samuel Lasiter has not pleaded nor had a trial yet, but according to statements from Arno Gene Graves and Daniel Duane Moon, the other two men involved, this is what happened: After the plant’s hours of operation and on weekends, Moon would drive his truck up and Graves and Lasiter would fill it with corn. Graves and Lasiter would then falsify the records and Moon would drive it down the road to another grain elevator and sell it. They ended up stealing a staggering amount of corn — more than 12 million pounds, estimated to be worth $1.5 million. That’s a lot of money, but Graves and Lasiter claim they only got a few hundred dollars a load. Either way, they’re facing at least a few years in prison.
Being the face of GMOs can’t be fun these days with things heating up over the controversial issue. That was the case when Monsanto withdrew its bids to sell some of its GM seeds with the European Union. The company cited its reasons as a lack of demand, slow approval process and that they were content to sell their non-GM seeds. Those all sound like good reasons to me, but some anti-GMO sources around the internet seem to think Monsanto is running scared.
This shows just how much these accidents can affect the industry. Our top story from last week makes another appearance this week. We once again, we wish to extend our condolences to Roy L. McCarty’s family and friends and to remind you that it only takes an instant to be engulfed in grain. So, please be safe out there. Have a harness, lifeline and observer anytime you enter a grain bin.
The Smithfield deal is rubbing a lot of people the wrong way. The only ones that seem to support it are Smithfield’s board of directors and Shuanghui International Holdings Ltd. So far, Smithfield has had to deal with government inquires, their own shareholders calling them out and even small share owners suing. Smithfield makes a good point. They are a business, and their job is to make as much money as possible. They insist that this will not allow Chinese pork into the United States (which is good given China’s suspicious food safety record), but that still means more of our pork will be shipped out of the country, leaving us with the byproducts. Only time will tell if this is a national security risk, like some are suggesting.
This is a fairly standard business story, but with a very large business. Southern States Cooperative® is restructuring their wholesale and retail business in order to make them more efficient. This story does follow a theme in modern agriculture, the focus on efficiency. Everyone is scrambling to feed an estimated 9 billion people by the year 2050 (which we are not projected to make at current improvement levels), and efficiency is one of the top weapons in that fight. Hopefully this change in structure gets us closer to feeding all those people.
I want to remind you to email me if you have any story ideas, comments on what news you want to hear about, or just to say "Hey." Subscribe to Industry Watch, follow us on twitter or like us on Facebook for all the latest news in the industry.
Welcome to the second week of the new Views on the News. I hoped to have this recap done earlier in the week, but I've been busy getting the August/September issue of Feed & Grain ready for you, so this post will be straight to the point.
I’m fairly new to the industry, but I’m told that once the weather heats up, news of grain bins deaths/injuries rise. I’m also told that this year is worse than normal. Our condolences go out to Roy L. McCarty’s family and friends. This story along with No. 5 on our list reminds us of just how dangerous an industry agriculture can be, and how easily a task that someone has done countless times before can kill them. So please, for everyone reading this, remember to be careful and follow best practices when you have to get into a grain bin. For safety tips to avoid grain engulfment, check out this article. Also, be on the lookout for a story on the new OSHA sweep auger regulations in our August/September issue.
This next story was talked about in last week’s "Views." But as of this update the bill still hasn’t gone to conference. With August recess around the corner, it doesn’t look like likely that we’ll be getting a farm bill soon. But many associations are encouraging those in agriculture to reach out to their representatives and let them know that the farm bill has not been forgotten and that a simple extension is not acceptable. So, call our email your representative this August, I will be.
The GM wheat that was found in that field in Oregon seems like old news. There are still lawsuits pending and the USDA investigation is ongoing, but after the USDA announced that no more GM wheat seemed to have entered the field or supplies, the story was over for most. Except for Japan, who is still uncomfortable accepting shipments of U.S. western-white wheat. A Japanese team met with the U.S. Secretary of Agriculture Tom Vilsack, and even though he felt confident about the meeting and said that exports would be accepted in early August, Japan has only said that it’s still a concern.
United Cooperative and Hillsboro Farmers Cooperative’s potential meager is a story that hits quite literally close to home. For those that don’t know, Feed & Grain is based out of Fort Atkinson, WI, a modest rural town in the southern part of the state. And the United Cooperative headquarters in Watertown, WI, is just a hardy stone’s throw away. So it’s always nice to see the local area making big news. This merger will make the new co-op more efficient at providing for its members, as well as give them a larger voice on the national stage, both good things for Wisconsin farmers. Hopefully it gets approved soon, so it can start that mission as soon as possible.
We started with tragedy and we end with it as well. This is an older story, posted in late April, but sill on the minds of many in this part of the country. With so many deaths happening lately, many people have been looking at those we’ve reported on in the past. We send out our deepest condolences to Jerad Guell’s family and end this recap by once again asking that you be safe out there.
I want to remind you to email me if you have any story ideas, comments on what news you want to hear about, or just to say "Hey." Subscribe to Industry Watch, follow us on twitter or like us on Facebook for all the latest news in the industry.
In the overnight session corn increased 2 ¼ cents, soybeans increased 1 ¾ cents and wheat fell 3 cents as we go into the morning pause in trade. Export sales which were released at 7:30 CST caused soybeans to give back most of the gains it had achieved in an overnight bounce.