President Trump Signs New Farm Bill
President Trump signed the 2018 Farm Bill yesterday, a bill he described as a “really tremendous victory for the American farmer." Key items included in the bill were continued support for the crop insurance system, increased funding for rural broadband, and reforms to the food stamps program.
Nearly three-fourths of the $87 billion per year Farm Bill goes towards food stamps. President Trump also announced a new regulation from USDA Secretary Sonny Perdue that restricts states from waiving the 90-day limit on food stamps to “work capable” adults. Also in the bill was an increase in acres allotted to the Conservation Reserve Program (CRP), which will rise to 27 million acres, up 3 million from the previous year. Additionally, industrial hemp was approved as a crop.
Russia Raises Estimates for Grain Exports, Easing Doubts of Export Limits
The Russian agriculture ministry has lifted their forecast for grain exports for the 2018/19 crop marketing year to 42 MMT. 14 MMT alone are expected to be exported in the first half of 2019. Traders at a meeting in Moscow today claimed that Russian ag ministers gave no indication that grain export quotas were in the works. The next meeting of this kind will take place in February. The previous export estimate issued by Russian officials was for around 38 MMT of total grain, 35 MMT of which were wheat.
Export Sales Announcements
Export sales of 222,504 metric tons of corn for delivery to unknown destinations during the 2018/2019 marketing year; and Export sales of 115,500 metric tons of soybeans for delivery to unknown destinations during the 2018/2019 marketing year.
Hot, Dry Weather Stresses Soybean Crop in Southern Brazil
Soybeans growing in the southern Brazilian states of Parana and Mato Grosso do Sul, two of the largest soy producing states, are currently in the midst of a heat wave with limited rainfall. Current estimates call for possible yield reductions of 10% and possibly 20% in the most severe cases. On Dec 19, the Brazilian Department of Rural Economics cut their production forecast for soybeans in Parana by 500,000 tonnes to 19.1 MMT due to drought stress. Currently, early planted soybeans have begun to fill pods and lack of moisture will likely impact this growth stage. Nearly an inch of rain is called for in the 8-14 day forecast from NOAA.
The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)
