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September 05, 2018 | Grain Hedge Insights | Kevin McNew | Views: 459

Heavy Rains and Flooding Threaten Kansas

National Weather Service reports that nearly 2 inches of rain fell last night and another 2 inches is forecast later today.

Heavy Rains and Flooding Threaten Kansas

Corn Conditions Drop Slightly, Soybeans Remain Steady As Both Crops Mature

The USDA Crop Progress report yesterday showed that the overall good to excellent score for corn dropped by 1% to 67%. Noteworthy reductions were Nebraska (-2%) and Illinois (-1%), which were offset by improvements in Colorado and elsewhere. Soybean conditions remain unchanged at 66% G/E. Overall, conditions improved in the East, with reductions seen in Minnesota (-3%) and South Dakota (-2%). The USDA also pegged corn maturity at 22%, with states such as Illinois and Indiana being ahead of schedule. Soybeans were rated at 16% dropping leaves, ahead of the 5 year average of 9%.

Canada to Resume NAFTA Talks in Washington D.C. Today

Canadian trade officials are headed to Washington to come to an agreement with the US on updating and modernizing the North American Free Trade Agreement. The key sticking points between the two countries at the negotiation table are opening up Canadian dairy markets to US imports, auto manufacturing, and whether or not to remove a mechanism that allows for trade disputes to be settled between the two countries. Canadian Prime Minister Justin Trudeau says that he will not sign a bad trade deal and that he is no hurry. Last week, President Trump finished a trade deal with Mexico and has stated that he will proceed to signing into law after 90 days, with or without Canada.

Export Sales Announcement

Private exporters reported to the U.S. Department of Agriculture export sales of 101,736 metric tons of corn for delivery to Mexico during the 2018/2019 marketing year.

Heavy Rains, Flooding Threaten Kansas, Iowa, and Wisconsin

The National Weather Service reports that nearly 2 inches of rain fell last night in central Kansas and that another 2 inches is forecast later today. The central part of the state is under thunderstorm threats and flood watches and warnings. NE Iowa is also under flood warnings as storms are expected to drench the area, dropping as much as 1-2 inches an hour at the highest rate. Wisconsin also faces flooding threats across almost the entire state, having seen very heavy rains over the past week.

 

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

September 05, 2018 | Coach’s Corner | Greg Martinelli | Views: 1146

7 Strategies for Selling to Busy Farmers

Game plans for the ag sales professional during harvest

7 Strategies for Selling to Busy Farmers

When the timing is right, nothing stands in the way of harvest. Your customer is within days or weeks of their busiest time of the year. When maturity, moisture and mother nature say its time, harvest will take off. This spring, we had a very quick planting window. We followed that with a hot and dry growing season, which sets us up for a quick harvest.

While planting and harvest are truly two of the busiest times of the year for producers, you still have opportunities to stay in touch and potentially make sales calls. Instead of being in their shop or office, it might be in the combine.

Here are seven strategies to use for selling in this busy time of the year!

1. Show the Importance of “Why Now?” for the Producer

The priority of your farm calls should focus on time sensitive deadlines, such as grain market movements, crop insurance, fall fertilizer and cover crop planting. These deadlines are set by external forces and can’t be adjusted.

Don’t Say: “Our company deadline for this offer is through next week and I really want to show it to you?”

Why: Because, your customer isn’t concerned about your internal deadlines. They have their own to worry about. In their view – “If you wanted my business, you would have made the deadline to fit my schedule.”

Do Say: “The market will only allow us to offer this storage or DP program for so long. I want to make sure you have an opportunity to participate in it if you want to.” OR “The deadline to sign up for 2019 wheat crop insurance is Sep. 20 and I know you wanted to cover your wheat this year.”

Why: These are specific to a real deadline and to this producer’s business.

2. Be Prepared

This is no time to be fumbling around with I-pads, cell reception or using unproven technology in your presentation. Have it all ready to go and practice it before getting on the farm.

Be prepared to have the farm call go from the full agreed upon time and place to anywhere else for any length of time.

It might get reduced from 30 minutes down to 10
It might change from meeting in the shop or office to riding in the combine
It might be nothing more than walking alongside them to the combine as they tell you things have changed and they need to get going.
They may cancel or not show
It might rain and they decide to give you more time than planned. They want to know more about the product than you originally thought you had time to present on.

It happens – be prepared – see item #4

3. Stick to the time agreed – better yet – use less time

This one is self-explanatory. Don’t- for any reason – go beyond the time agreed upon without asking permission.

It’s wise to start every sales call off with an understanding of how long you have with them. This shows respect for their time and yours. When the call is going well, it’s tempting to just keep going and going and going.

I once coached a sales person that did this on every call. He would consistently go over his agreed upon time by 30 minutes to an hour. Needless to say, he was a talker. When I asked him if he thought this was a problem, he replied – “No, my customers know me. They know that’s just how I am and they accept it.” My follow up question was – “How many times do you think they didn’t answer your call or didn’t give you an appointment because you go over your allotted time?”

If things are going well and the producer seems to be allowing you to go past the agreed upon time, ask if it is ok to continue. This is the professional thing to do and respects the producers time. It also will tell you how interested the producer is in what you are discussing.

4. Have a One-Page Leave-Behind Piece

This is a good idea whether they are busy or not. Typically, they won’t remember all the details of your presentation like you do. The one page is great as a leave behind to provide an added reminder. Secondly, you can leave the one page with the producer if the meeting is cancelled and you want to follow up with a phone call later to discuss it.

5. Have a Next Step

Again, this is something you should always think through. However, when customers are busier than normal, be very clear about what you want them to do next. These shouldn’t be deep thought provoking sales calls, since they are busy. These should be very directed, time sensitive presentations. That’s why the producer gave you the appointment in the first place. Have the steps clearly defined. If not, you’ll get the “Let me think about it” reply.

Sometimes, the material is not something you want in a leave behind document. Maybe it’s too complicated to explain or put on one page. Maybe you want to be there when the producer is learning about it so you can explain it correctly & answer questions. This is understandable, just let the producer know that you would like a follow up meeting after harvest. Sometimes, this is the only next step you can get.  

6. Develop Another Point of Contact with the Customer

Often, there are several people involved in an operation. One brother might take care of agronomy, the other the grain marketing and another the animal production. Or, Dad takes care of the decisions and the kids take care of actually executing on the use of the products. It can be a good time to catch them briefly and check to make sure logistics are going well. Often, the spouse handles the books. It can be a good opportunity to check in and make sure all the paperwork is flowing smoothly.

If the crop side of the business is busy with harvest, it might be a good time to bring out your feed sales person to talk with the brother that manages that side of the business. Just being involved and on the farm, can strengthen the relationship.

7. Be Readily Available

Any successful sales person knows this is critical for keeping customers. You have to be readily available at all times. During your customer’s peak times, it’s even more critical.  Not only available but you need to be extra responsive. This is no time for business as usual. Your customer is operating at a higher intensity than normal and may even be in panic mode. We’ve all had those customers that completely change under the stress of peak times in farming. Do everything in your power to go above and beyond expectations to expedite your support.

Here are some final thoughts: 

  • You don’t have to completely quit calling on customers at this time of year. Following the seven recommendations above will help.
  • In today’s world of farming, it’s always the busy season. Spring is of course busy with planting, which leads into fungicide season, which gets you to wheat harvest and then right into more fungicide season. A couple weeks later and we are into corn/bean harvest, which is followed by fall fertilizer application. Now, we are into the holidays and need to get into January before calling on them. In January producers begin attending meeting after meeting through March to prepare for the upcoming planting season. Waiting for them to be done with the busy season might not be a good option.

None of us want to be overly pushy or salesy and definitely want to respect the busiest times of the year. With some preparation and focus, however, we can stay connected to our customers. Most importantly, we can continue to provide the needed products and services we sell.

September 04, 2018 | Monday Mycotoxin And Crop Report | | Views: 369

Monday Mycotoxin and Crop Report for September 4

New aflatoxin and fumonisin reports in corn, update as corn crop progress races on, and sample variability when testing for toxins

Monday Mycotoxin and Crop Report for September 4

Neogen’s latest Monday Mycotoxin and Crop Report comes to you on a Tuesday, bringing you new aflatoxin and fumonisin reports in corn, an update as corn crop progress races on, and a talk from Tech Tip Tony on sample variability when testing for toxins.

 

September 04, 2018 | Grain Hedge Insights | Kevin McNew | Views: 338

Russia Will Not Set Export Limits for Grain

Country's Ministry of Ag sees no need to enact export taxes or take any other measures to reduce exports out of Russia

Russia Will Not Set Export Limits for Grain

Russia Will Not Set Export Limits for Grain, Wheat Tumbles

The Russian Ministry of Agriculture met with grain traders and exporters yesterday and shortly after announced that they see no need to enact export taxes or take any other measures to reduce exports out of Russia. Russian officials at the Ministry of Agriculture state that the domestic “grain market is stable” and due to a smaller crop, they do not anticipate much growth in exports for this year. Russia is the world’s largest exporter of wheat. Following this news, Chicago SRW fell over 15 cents, KC HRW down 16.75 cents, and Minneapolis HRS was down 13.75 cents.

Speculators See Net Shorts Grow for Soybeans, Corn; Remain Optimistic for Wheat

Managed money was selling corn for the week ending on Aug 28, increasing their net short position by 42,133 to 56,957 contracts. This is based on the sentiment that the USDA may be underestimating the size of the US corn crop. Money managers also increased their net shorts for soybeans by 13,593 to 53,642 contracts. This level is about 23,000 more short positions than this time last year. Speculators remain net long for wheat, but pulled back on their positions slightly. Chicago SRW net longs fell 9,632 to 51,180 contracts. KC HRW’s net long dropped 2,913 to 61,460 contracts and MN HRS net longs were reduced by 3,131 to 2,565 contracts.

Flash Floods May Affect Low Lying Areas Across Central Corn Belt

Flash flood warnings and watches are in effect from parts of central Kansas all the way to N Wisconsin. Areas near creeks or rivers may be threatened by heavy rains over the first half of this week. Central Kansas and SE Nebraska are expecting 1-3 inches of rain today, which will total around 5 inches since Sunday. Forecasts from the NWS also call for up to 6 inches of rain in areas of N Iowa, S Minnesota, and central and N Wisconsin. Wisconsin has been in and out of flood watch over the past week and these new rains may make matters worse.

 

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

August 31, 2018 | Grain Hedge Insights | Kevin McNew | Views: 630

Swine Fever Outbreak in China Larger than Expected

Perdue: Media in China is likely underreporting the spread of ASF

Swine Fever Outbreak in China Larger than Expected

President Trump Considering Withdrawing from World Trade Organization if They Do Not “Change Their Ways”

In an interview with Bloomberg yesterday, President Trump threatened to pull out of the World Trade Organization (WTO) if they continue to, in the Trump Administration's opinion, treat the US unfairly. US Trade Representative Robert Lighthizer claims that process of settling disputes in the WTO have interfered with US sovereignty and that admitting China to the WTO back in 2001 was a mistake because he believes that they are unable to deal with the Chinese non-market economy. The US leaving the WTO would have more significance than the Trade War with China, as it would destabilize the post-World War II international trade system that the US created. President Trump has called the WTO “the single worst trade deal ever made”.

Export Sales Announcements

Export sales of 273,800 metric tons of corn for delivery to unknown destinations during the 2018/2019 marketing year. Export sales of 250,000 metric tons of soybeans for delivery to unknown destinations during the 2018/2019 marketing year.

USDA Secretary Perdue Claims Outbreak of African Swine Fever In China Is Likely Larger Than is Being Reported

Secretary Perdue claimed on Thursday that the media in China is likely underreporting the spread of the African swine fever (ASF) that has affected hog farms across China. The Chinese Ministry of Agriculture and Rural Affairs said on Thursday that 185 hogs were confirmed to be infected on a farm in Anhui province in eastern China. This marks this 5th confirmed outbreak of ASF this month. If hog herds were to be culled in China, it would significantly affect demand for soybeans there. Last year, China imported 96 MMT of beans, with nearly a third coming from the US, where they are predominantly crushed and the meal is used as feed for domestic hog farms.

Heavy Rains, Possible Flooding Expected Over Central Corn Belt

The National Weather Service is reporting the formation of an “active wet pattern” over Iowa, Minnesota, and Wisconsin over the weekend. Flooding may occur in these areas and Wisconsin specifically was recently under flood warnings and advisories earlier this week following heavy rains. Parts of SE Missouri and SW Kansas are also under flood warnings after nearly 5 inches of rain fell yesterday. More rain is forecast for the area again on Monday.

 

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

August 30, 2018 | Grain Hedge Insights | Kevin McNew | Views: 289

Ethanol Production Down

Production was down in Rocky Mountain and Gulf Coast areas, but was made up for by increased production in the Midwest

Ethanol Production Down

USDA Secretary Perdue Says Trump Wants Year-Round E15 Approval Soon

Speaking at the Farm Progress Show in Boone, IA, Secretary of Agriculture Sonny Perdue told the crowd that President Trump called and told him that he wants the USDA and EPA to bring forth a proposal for year-round E15 that he can announce some time next week. The Renewable Fuel Standard (RFS) is a program managed directly by the EPA. Previous EPA chief Scott Pruitt, issued many hardship waivers to blenders and refiners that allowed them to forego blending biofuels into gasoline or diesel fuels, hurting demand for ethanol. Pruitt has since resigned and is replaced by Acting EPA Administrator Andrew Wheeler. Secretary Perdue also weighed in on any long term damage done to trade relationships amid the Trade Wars, saying that the United States remains a “reliable supplier” to the rest of the world.

Export Sales Announcement

Private exporters reported to the U.S. Department of Agriculture export sales of 100,611 metric tons of corn for delivery to Mexico during the 2018/2019 marketing year.

Ethanol Production is Down for First Time in Nearly 4 Weeks, Stocks Draw Down As Well

For the week ending on Aug 24, production of ethanol fell from the week before for the first time since July 27 to 1.07 million barrels per day, down slightly from last week’s 1.072 million barrels. Production was down in the Rocky Mountain and Gulf Coast reporting areas of the EIA, but was made up for by increased production in the Midwest. Stockpiles of ethanol also drew down by 0.178 to 23.061 million barrels per day. This is the first reduction of ethanol stocks since Jul 20.

Corn Export Numbers Disappoint, Soybeans Fall in Line with Expectations

Old crop corn export sales were reported at 175,400 MT, up only 1% from last week and down 46% compared to the 4 week average. New crop corn sales came in below trader’s expectations at 525,000 MT. The largest buyers were Mexico, Unknown destinations, and Panama. Old crop soybeans fell to the low end of expectations at 110,900 MT, a drop of 27% from last week and 39% from the 4 week average. New crop sales were also the low side of the range at 591,600 MT. Top buyers were Unknown destinations, Mexico, and Pakistan. Wheat sales were reported at 414,800 MT, up 73% from the prior week but down 5% from the 4 week average. Major buyers were the Philippines, Japan, and Mexico.


 

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

August 27, 2018 | Monday Mycotoxin And Crop Report | | Views: 500

Monday Mycotoxin & Crop Report for August 27

This week we cover new mycotoxin reports in corn and barley

Monday Mycotoxin & Crop Report for August 27

For more information, please visit foodsafety.neogen.com. Neogen Corporation takes great care to ensure the integrity of the data we collect from many sources across the country. As these data can vary widely, they should NOT be considered typical of all grain harvested. The mycotoxin levels we report are intended to assist our industry partners in developing their risk assessment programs. Detecting problems before commingling or processing can help avoid quality issues and financial losses.

August 24, 2018 | Grain Hedge Insights | Kevin McNew | Views: 264

Weekly Cash Commentary

Cash Comments for week ending August 24

Weekly Cash Commentary

Another big sell-off on spot bean basis as many buyers collapsed their spot offering to par with fall delivery. On the week, corn basis was unchanged while soybean basis sank 6 cents a bushel across the country.

Soybeans along the river were hammered this week thanks to higher barge freight and weakening Gulf bids. On the week, river terminals saw a 21-cent plunge in spot basis. Along with spot soy basis, new-crop bids continue to feel the pressure of an impending record large harvest backed by ample old-crop supplies. The table below shows what the average new-crop basis is by state and how that compares to basis at harvest in 2017. Aside from Michigan, most areas are seeing double-digit losses on new-crop basis. Especially hard hit are river terminals where high barge freight and lower export interest is putting basis levels on the defensive for the Fall. This year more than most will be a time for farmers to store soybeans to capture better basis in the Dec/Jan window.

 

New-crop Soybean Basis for 2018 vs Actual Soybean Basis in 2017

For end users, corn was mostly unchanged at ethanol plants. There were a few plants in MN/IA that gave a better basis by the end of the week. Soy plants were mostly under pressure this week giving up 4 cents on average.

 

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

August 24, 2018 | Views on the News | | Views: 473

U.S. Tariffs in the Global Landscape

Information to help understand the complex trade policy decisions being made

U.S. Tariffs in the Global Landscape

Information regarding tariff rates and talk of trade wars have been pouring into the media cycle lately. With agriculture at the tip of the spear in this war, it is important to understand the complex trade policy decisions being made. This article is the first in a weekly series that will profile different commodities and the tariffs they face.

Figure 1 illustrates the comparison between gross domestic product per capita and the average tariff a country charges incoming agricultural products. The United States has an estimated $59,500 GDP per capita and an average most favored nation tariff rate of 5.2% for agricultural products. MFN tariffs are what countries promise to impose on imports from other members of the World Trade Organization unless the country is part of a preferential trade agreement (such as a free trade area or customs union).

In contrast, countries with a substantially lower GDP per capita, like India and Ghana, have a higher MFN tariff of 32.7% and 20.2%, respectively. One of our largest trading partners, China, maintains an average tariff on agricultural products of 15.2%. Another of our largest trading partners, the European Union, charges an average of 11.1% on agricultural products.

Canada and Mexico, our counterparts in the North American Free Trade Agreement, currently charge average MFN tariffs of 15.6% and 14.6%, respectively, on agricultural products from WTO members who are not free trade agreement partners. However, because of NAFTA, the preferential average tariff on U.S. agricultural products into Canada and Mexico is 6.9% and 0%, respectively.

Healthy trade relationships based on reciprocal exchange build countries. Maintaining these relationships not only strengthens the global economy but also boosts the welfare of every American.

 

 

 

In 2017, the U.S. imported $368 million worth of soybeans, charging a 0% tariff, and exported $21.5 billion worth of soybeans. The net trade balance on U.S. soybeans equates to over a $21 billion surplus.

Buying over 60% of the world’s production last year, China is the world’s largest importer of soybeans and the U.S.’s largest customer. The current tariff China charges on soybeans is 3%. However, with retaliatory tariffs of 25%, the U.S. is now charged 28%.

Free trade agreements like NAFTA encourage trade between nations by lowering the tariff on soybeans to 0%. Mexico is our second-largest soybean customer and charges the agreed-upon 0% tariff, instead of their average tariff of 7.5% on soybeans. Free trade agreements continue to boost trade by lowering barriers between nations. In 2017, the U.S. exported $2.5 billion worth of soybeans to FTA partners, up 11% from 2016. Figure 2. takes a closer look at soybean tariffs.

 

Information provided by the American Farm Bureau Federation.

 

Contact:
Megan Nelson
Economic Analyst
(202) 406-3629
megann@fb.org
 
Veronica Nigh
Economist
(202) 406-3622
veronican@fb.org

August 24, 2018 | Grain Hedge Insights | Kevin McNew | Views: 399

Pro Farmer Day 4 Results

Iowa corn yields were second highest of the 7 states included on the 2018 Pro Farmer crop tour, only behind Illinois

Pro Farmer Day 4 Results

Pro Farmer Day 4 Shows Improved Yields for Iowa, Drops for Minnesota Corn

Day 4 of the 2018 Pro Farmer crop tour finished in Iowa and Minnesota yesterday. Their corn yield estimate came in at 188.2 bpa, up from last year’s 179.79 bpa. Soybeans also improved from 1092.92 pods in a 3x3 square in 2017 to 1208.99 pods this year. Minnesota saw an improved soybean estimate of 1090.47 pods, compared to last year’s Pro Farmer estimate of 1019.96. Corn yield fell, however, from 191.54 bpa in 2017 to 178.67 bpa this year. Iowa corn yields were the second highest of the 7 states included on the 2018 Pro Farmer crop tour, only behind Illinois at 192.63 bpa. Minnesota corn yields were dead last, primarily due to heavy rains that have delayed maturity of the crop.

Export Sales Announcement

Private exporters reported to the U.S. Department of Agriculture export sales of 146,000 metric tons of soybeans for delivery to unknown destinations during the 2018/2019 marketing year.

USDA Will Announce Details of Farmer Aid Package on Monday

USDA Secretary Sonny Perdue stated that the detail of the $12 billion aid package for farmers affected by the ongoing Trade War. Previously, Secretary Perdue said that around $7-$8 billion would come in the form of direct cash payments to farmers, but this proposal is under review by the Office of Management and Budget. Perdue also said that $200 million of the aid package would go towards developing new markets and opening up trade for agricultural products. Earlier this week, Agri-Pulse reported that the preliminary amount for cash payments would be $1.65 per bushel for soybeans and $0.01 per bushel for corn. This would equal $7.6 billion in aid for soybeans by themselves. Secretary Perdue did not confirm these prices.

Heavy Rains Overnight Have Caused Flooding In N Missouri, More Rain Expected For Northern Midwest

Last night, nearly 5 inches of rain fell over parts of northern Missouri, according to the National Weather Service. The NWS also warns that flash flooding may soon occur, with another inch of rain in the forecast. Areas of E Minnesota, Wisconsin, Illinois, and Michigan can expect 1-3 inches of rain over the next 5 days.

 

The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)

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