WEEKLY NEWS HIGHLIGHTS

S & D #’s — USDA is projecting US wheat ending stocks for 2005/2006 at 532 million bushels. That is below the average trade guess of 541 million and below the March USDA forecast of 542 million. Corn ending stocks are estimated at 2.30 billion bushels. That figure is above the pre-report average estimate of 2.25 billion and below the March USDA number of 2.35 billion. Soybean ending stocks of 565 million bushels is unchanged from USDA’s record March forecast. The average of analyst estimates was at 571 million.

Senate Appropriations Committee Supports Ag Disaster — As part of the supplemental appropriations bill funding Katrina relief and the War on Terrorism, the Senate Appropriations Committee unanimously supported nearly $4 billion in farm disaster assistance. The bill must pass the full Senate and survive the conference committee process.

Focus Thailand — Soybean farmers from Minnesota and the Dakotas are pleased with the contacts made with potential customers in Thailand. Louis Bainbridge of Ethan, South Dakota sees opportunity, but challenges remain. "They put the monkey on our back; we better get with the program and get some better protein coming their direction." The Argentine harvest is underway, making this one of the toughest times of the year to market US soybeans. "American Soybean Association President Bob Metz was still encouraged. "Every feed mill we went into there was at least a $15 premium over beans from South America or $20 to $25 premium over beans from India, but there wasn’t question about the quality of our soybean meal." RRFN Mike Hergert was the only journalist participating in this trade mission to Southeast Asia.

Barge Charge — Three of the four major barge operators have announced increases in demurrage charges, effective in September. "Today, you have five free days on a barge after they constructively place it to you and they’re moving to three days," said Gary Anderson, Country Hedging merchandising manager, "Those two days amount to a $400 increase in expense per barge and if you take $400 and divide it by 55,000 bushels, you’re looking at just over 3/4 of a cent per bushel." The increase in demurrage charges is designed to better utilize current equipment. According to one barge operator, "we don’t want our barges to be used as floating warehouses."

Corn on Corn — In southwestern Minnesota, the soils remain saturated. Jim Nesseth is with Extended Ag Services in Jackson. Nesseth says the Prospective Plantings Report has growers rethinking their seed decision. He expects to see more corn on corn in his region. "We’ve got a lot of livestock and a lot of manured acres; corn on corn with some starter fertilizer is a nice option." Syngenta Field Sales Manager Marty Burkhart covers the northeast corner of South Dakota and he says wheat acres are the swing factor. "If these guys can go by the 15th or 20th of April, they’ll put spring wheat in," said Burkhart, "If they can’t get going until later, they may back off on spring wheat and put in more corn."

Brazilian Crop Estimates — Celeres, the Brazilian ag consultant, has cut its crop estimate. At 57.4 million metric tons, it would still be a record. The Brazilian government statistics institute, known as IBGE, estimates the soybean crop at just under 56 million metric tons, down more than a ton from last month.

NAIS Update — USDA is continuing to seek full implementation of the National Animal Identification system by 2009. Other countires are ahead of the game in developing an ID system and Agriculture Secretary Mike Johanns said retailers will soon demand similar programs in the US. "I believe that is the catalyst for ranchers, for sale barns, for producers, for whoever, to recognize that the time for this has really arrived." Today, more than 235,000 premises are registered in the ID program — just over 10 percent of expected premises. At this point, the ID program remains a voluntary effort.

2007? — The Japanese media is saying it may be 2007 before US beef imports are allowed into Japan. South Dakota Senator Tim Johnson says that is unacceptable. "I think that our hand would be strengthened if we had country of orgin labeling; then we could confirm to the Japanese that it is indeed American beef that we are selling them, but even without that, we need to use all the leverage we’ve got to open up the Japanese border as soon as possible." Johnson says Japan should not put up artificial trade barriers to US beef.

Japan Panelists Quit — Half of the members on Japan’s Food Safety Commission have quit. After months of deliberation, the independent panel opened the Japanese market to US beef imports in December. When a bone-in veal shipment was found in January, trade was suspended again. The Kyodo News Agency reports these Food Safety Commission members resigned because the government intervened and recommended the resumption of trade.

Asia FTA Proposed — Japan is proposing an Asian economic free trade zone that would include nearly one-half of the global population. The 16-nation FTA would include China, India, Japan, Australia, New Zealand and South Korea. If realized, this trade zone would be larger than NAFTA and the European Union. Japan wants negotiations to begin in 2008 and completed in 2010.

WTO Hopes Fade — There is growing pessimism for the Doha Round of the World Trade Organization. It seems impossible a deal can be made before the April 30th deadline. Trade leaders say July 2006 is the final, irrevocable deadline for a draft deal, not only for agriculture, but the entire round.

US Ethanol Production Triples in Last 6 Years — Nearly 100 ethanol plants are now producing 4.7 billion gallons. Ron Lamberty, Market Development Director for the American Coalition for Ethanol, says that’s still not enough to meet the current demand. "With the removal of MTBE from the fuel supply right now, there has left a void of about 2 billion gallons. Even though the ethanol industry is increasing by a billion gallons this year; there is still another billion gallons of opportunity out there." There are 33 ethanol plants under construction in the United States. Lamberty spoke at a NAMA Northern Prairie Chapter meeting.

Biodiesel Production Growing — The United States has 53 biodiesel plants with production capacity of 350 million gallons per year.

AUSD Hosts Livestock Meeting — According to Steve Dick of the Agriculture United for South Dakota, the high cost of land has producers considering livestock. "We’ve seen farmland in the eastern third of South Dakota going for over $3,000 an acre and cash rents of $180 an acre; producers are looking for other options to make their family business viable." Dick says livestock may be an option for those families. AUSD sponsored a livestock seminar last week in Madison.

Cows May Have Cancer Answer — South Dakota State University researchers are modifying the composition of milk fat to make it easier to process and healthier for the consumer. As part of the research, anti-carcinogenic properties of conjugated linoleic acid are being evaluated. By changing the cow’s diet, there may be anti-cancer agents available to the consumer.

Monsanto Milestone — Forty percent of US corn acres will be planted with Roundup Ready Corn 2 technology this year. "We’ve seen substantial growth this past winter seed selling season," said Monsanto Marketing Manager John Jansen, "We’re looking foward to planting over 32 million acres of Roundup Ready Corn 2 in this 2006 growing season." That’s up from 24 million acres in 2005. Jansen says Minnesota and the Dakotas have been early-adopters of the technology and he’s now seeing similar success in the Central Cornbelt.

AngusSource Enrollments Reach Record High — The AngusSource program enrolled more than 12,000 head in March. That beat the old record by 3,000 animals. To date, more than 131,000 head of cattle have been enrolled. AngusSource documents a minimum of 50 percent Angus-sired genetics, sources cattle to the ranch of origin and provides age verification.

New Patent for John Deere — John Deere Ag Management Solutions has a new patent on RTK Extend for the StarFire RTK guidance system. The new feature brings more consistency to the guidance system.

Dupont Syngenta Joint Venture — Dupont and Syngenta are forming the seed industry’s first 50/50 joint venture to out-license genetics to US and Canadian seed companies. The joint venture, known as GreenLeaf Genetics, will offer corn and soybean breeding material from both companies. The deal also allows Syngenta to market the new Optimum GAT herbicide tolerant trait developed by Dupont.

Gehl Shutting Down its Ag Implement Line at West Bend, WI — The ag product lineup includes hay and forage equipment, manure handling and feed production equipment. Gehl will continue to manufacture compact equipment for the agriculture and construction markets, including the skid steer loaders manufactured at Madison, South Dakota. Gehl Chairman and CEO William Gehl blames the decision to drop its agriculture implement lines to the loss of small dairy farms. That market segment has been Gehl’s traditional customer base.

Cooks Ham Goes to Smithfield — Smithfield Foods has completed its acquisition of Cook’s Hams from ConAgra Foods. Cook’s is based in Lincoln, Nebraska and produces traditional and spiral cut bone-in hams. The deal is worth $260 million.

Off-Farm Income — According to a Farm Credit Administration report, small farms derive over 90 percent of their total income from off-farm sources. In response, the FCA board authorized AgStar Financial Services, based in Mankato, to make an investment designed to meet the financing needs of new and existing agricultural and rural businesses.

CHS US BioEnergy Form Joint Venture — CHS Inc. and US BioEnergy have formed a new joint venture to market ethanol and biodiesel. The deal combines marketing savvy with the organization’s strength in storage and transportation. CHS became a shareholder in US BioEnergy last fall. BioEnergy has ethanol plants under construction in Iowa and Michigan and facilities under development in Hankinson, North Dakota and Janesville, Minnesota.

Weedkillers Approved for Sweet Corn — The Environmental Protection Agency has approved the use of LUMAX, Lexar and Camix in sweet corn. The Syngenta Crop Protection products are used for pre-plant and pre-emergence weed control.

DU & Bayer CropScience Partnership — The $500,000 agreement will allow Ducks Unlimited to provide more incentives for farmers to grow winter cereals. "It will allow us to continue to provide incentives in Dickey County and expand into Brown County of South Dakota," said Blake Vander Vorst, regional DU agronomist, "We will also open up new project areas in northwest North Dakota." Research indicates duck nest success improves by 35 times with fall-planted winter cereals than spring-planted crops.

New Driver — Rahal Letterman Racing has named a new driver for Team Ethanol. Jeff Simmons will replace Paul Dana, who died while practicing two weeks ago. Simmons will serve as a spokesman for ethanol while competing in the Indy Racing League. Team Ethanol includes Broin Companies, Fagen Incorporated and 25 other companies that are part of the renewable fuels industry.

SDCUC Member in Tokyo — A member of the South Dakota Corn Utilization Council is in Tokyo today for a Food Safety Conference. Paul Shubeck of Centerville is a member of the US Grains Council Value-Added Team. The conference is being organized by the Grains Council, American Soybean Association and US Wheat Associates to address food safety issues affecting US exports to Japan.

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