Corn beginning stocks were lowered on the U.S. Department of Agriculture’s (USDA) World Agricultural Supply and Demand Estimates (WASDE) report released last week.
The August projection pegs beginning corn stocks at 1.18 billion bushels. Production was forecast at 14.03 billion bushels. Exports were raised 25 million bushels to 1.72 billion bushels. Ending stocks are now projected at 1.81 billion bushels, the report said. The projected season-average farm price for corn was lowered 10 cents at both ends of the range to $3.55 to $4.25 per bushel.
U.S. soybean production for 2014-2015 was forecast at 3.82 billion bushels. Soybean supplies for 2014-2015 are projected slightly above last month based on the higher production forecast. With minimal supply gains, soybean exports and crush were unchanged, leaving ending stocks projected at 430 million bushels. The U.S. season-average soybean price for 2014-15 was forecast at $9.35 to $11.35 per bushel, down 15 cents on both ends.
China suspends pork
China last week suspended six major U.S. pork plants and six cold storage facilities from its list of eligible pork exporters based on its ractopamine-free requirements. The list includes two Iowa Tyson Fresh Meats plants in Perry and Storm Lake.
An Aug. 11 notice from China’s General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) to the U.S. Embassy’s Office of Agricultural Affairs in Beijing indicates that the delistings are due to findings of ractopamine. China bans use of the feed additive — which is legal in the United States — and required exporters to obtain ractopamine-free certification for their products as of July 1.
Hog prices fall
Hog futures fell to the lowest level since February on signs that consumers are scaling back on pork purchases after prices for the meat reached all-time highs.
Wholesale pork fell 17 percent since reaching a record $1.3756 a pound on July 18, U.S. government data show.
Consumers are shifting to cheaper poultry for grilling, David Kruse, the president of Royal, Iowa-based CommStock Investments Inc., said.
Hog futures in 2014 soared as much as 56 percent to an all-time high in March as the porcine epidemic diarrhea virus (PEDV) killed as many as 8 million piglets. Prices are down 28 percent since June 30, the biggest loss among the 22 raw materials tracked by the Bloomberg Commodity Index.
The declines came as slaughter rates and animal weights increased, while the spread of the disease slowed.
U.S. corn to Colombia
The United States is on track to capture more than 95 percent of Colombia’s 3.6 million metric ton (141 million bushels) corn market this marketing year, which ends Aug. 31. This is a turn-around from 2013 exports of just 644,000 tons (25 million bushels) to that country.
It wasn’t until the U.S.–Colombia free trade agreement (FTA) was implemented in 2012 that U.S. exporters began to become competitive once again in this market.
The duty-free quota of 2.3 million tons for this year was filled in June. The low international price of corn has caused Colombia to raise its duties on other origins to more than 30 percent, compared to 18 percent on corn from the United States. As a result, Colombian grain importers returned aggressively to buying U.S. corn.
DDGS, CGM exempt
Malaysian officials agreed to permanently exempt imports of U.S. distillers dried grains with solubles (DDGS) and corn gluten meal (CGM) from that nation’s new, more stringent sanitary and phytosanitary (SPS) and inspection regulations for agricultural commodities. The decision makes permanent a temporary exemption, granted in May, for the period from July 31 to Dec. 31, 2014, the U.S. Grains Council (USGC) said last week.
Deere announces layoffs
Deere & Company last week announced it will place more than 600 employees at four locations on indefinite layoff.
Employees have been informed at the affected facilities, which include John Deere Harvester Works, East Moline, Illinois; John Deere Seeding and Cylinder, Moline, Illinois; John Deere Des Moines Works, Ankeny; and John Deere Coffeyville, Coffeyville, Kansas. In addition, Deere is implementing seasonal and inventory adjustment shutdowns and temporary layoffs at several of the affected factories.
When Deere announced third quarter earnings last week, the company said it planned to reduce ag equipment production.