Farmweek nov 3 2014

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EPA’s Clean Power Plan could boost Illinois electric rates. Consider submiting a comment. page 5

Senate Ag Committee members joined NACD offcials in questioning EPA’s water proposal. page 7

Crop markets strengthen amid delays Monday, November 3, 2014

Two sections Volume 42, No. 44

BY DANIEL GRANT FarmWeek

The last week of October proved a treat for most farmers in Illinois. Weather conditions were favorable for harvest and the crop markets, particularly soybeans, strengthened due to the slow harvest pace, logistical issues and tremendous international demand, among other factors. Crop prices this month climbed 12 to 15 percent. Soybeans led the charge as beans for January delivery at the Chicago Board of Trade pushed $10.50 per bushel, the highest level since August, before a retreat late last week. “We came into harvest with all the focus on how big the crops will be,” Joe Camp, AgriVisor risk management specialist, told FarmWeek. “Now, with a somewhat Joe Camp delayed harvest, we watched the soybean complex skyrocket. “Finally, we’re talking about the usage side of the equation,” he continued. “Before this month, (the trade) was so focused on lofty yield expectations.”

Periodicals: Time Valued

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Matt Niedbalski of Nashville finished planting wheat, but state planting lags the average pace. page 3

Southern Bureau County farmer Glen Wright harvests soybeans yielding in the 50s. Wright and his son, Todd, made good soybean harvest progress last week, leaving only double-crop beans left to combine. (Photo by Cyndi Cook)

U.S. farmers as of the first of last week harvested 46 percent of the corn crop (19 percent behind the five-year average) and 70 percent of beans (6 percent behind the average pace). The slow pace of harvest in recent weeks was exacerbated by previously tight soybean stocks entering harvest along with

issues securing enough rail cars to move the crops to end users. “We came into the year with the (soybean) pipeline almost empty, and coupled with the fact harvest has been delayed, there’s not enough product” to satisfy demand in a timely manner, Camp said. “Rail space has been hard to come by, so there’s

been difficulty moving soy meal into export positions.” The price of soy meal subsequently shot up nearly $100 per ton at some locations. Export inspections of soybeans from the U.S. climbed for the eighth straight week last week. Crop prices also gained support in recent weeks from out-

side investors who moved money into commodities due in part to concerns about the European and international economies. Previous concerns about dryness in Brazil were alleviated by rains in many areas there during the last two weeks, Camp noted. Farmers in Illinois made considerable harvest progress as they cut 26 percent of the soybean crop and 16 percent of corn the last full week of October. “The weather has been fantastic the past week and a half with good drying days,” said Larry Hummel, a FarmWeek CropWatcher from Dixon (Lee County). “We were picking a lot of corn with moisture around 25 to 27 percent, which doesn’t go through the dryer very fast,” he continued. “Now, some of the same varieties are down to 21 percent. It’s really helping speed things up around here.” Harvest in Illinois the first of last week was 59 percent complete for corn (13 percent behind average) and 63 percent complete for beans (14 percent behind average). “A lot of the regular beans are done, but most of the (double-crop) beans are still

Export outlook: China will still drive ag market BY DANIEL GRANT FarmWeek

A slower rate of economic growth in China could impact demand for ag commodities and prices at a time when crop supplies are ample. But the long-term outlook for protein demand in China, and exports in general, remains bullish. Gaogao Yu, an oilseed economist at Doane Advisory Services, believes the rate of gross domestic product (GDP) growth in China this year may not reach 7.5 percent as previously predicted. GDP growth in China the past decade averaged close to 10 percent. “The economy (in China) has slowed down the last couple years,” Yu said during Doane’s 31st annual outlook conference. “The drop in the rate of growth in the short run

See Harvest, page 3

could leave the world with extra supply (of feed grains). “But I still expect (the Chinese economy) will maintain a high growth pattern for coming years,” she continued. “And, long run, I’m still optimistic China will act as an engine for global commodity demand.” Yu based the prediction on her expectation that China will continue to transition from a manufacturing and investment-dependent economy to a consumption-driven economy. Urbanization in China could expand from 30 percent to 80 percent by 2030, Yu said. “This will generate huge consumption potential for household items,” she said. China, the world’s second-largest economy behind the See China, page 3 www.facebook.com/illfarmbureau


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