October 2018
Ag Insight

Ag Insight

USDA Adds New Tools, Resources to Farmers.gov Website

Agricultural producers have new resources available on the U.S. Department of Agriculture’s website, farmers.gov, to prepare for and recover from impacts of natural disasters. The site has updated tools and information to help agricultural producers identify the right programs and make decisions for their operations.

New additions to the site include a farmers.gov portal for secure business transactions and a disaster assistance discovery tool. The discovery tool walks producers through five questions to help them identify personalized results of what USDA disaster assistance programs meet their needs.

The farmers.gov portal is the first edition of a secure dashboard for producers to manage program applications and other USDA documents.

The new resources are in addition to others currently available through the farmers.gov website, including a service center location, information about the new 2017 wildfire and hurricanes indemnity program, the regularly updated farmers.gov blog, and a soil health webpage.



Strong Turkey Exports Expected
This Year With Mexico Volume Up

After dipping in January 2016 to their lowest level since 2010, turkey exports have crept upward with the key recovery happening in Mexico, the largest destination for U.S. turkey shipments.

Although the United States is the world’s largest producer and exporter of turkey meat, overseas sales dropped sharply after the 2015 outbreak of Highly Pathogenic Avian Influenza. That incident resulted in significant animal losses and the temporary or partial closing of key export markets.

For most of the last decade, more than half of U.S. turkey exports have gone to Mexico, with the share reaching as high as 74 percent of all shipments in July 2014.

As exports have recovered, the share of shipments going to Mexico has generally risen as well, apart from seasonal patterns.

With domestic prices remaining below historical levels and cold storage stocks still high, the export market is expected to remain an attractive option for producers. Exports have averaged 11 percent of production over the last 12 months, up from just under 10 percent in the previous 12-month period.

Annually, exports are expected to grow further in 2018 to 663 million pounds, a 7 percent increase over 2017. But export analysts expect turkey meat exports in 2019 will total 655 million pounds, a 1 percent decline from the strong export totals predicted this year. 


Morocco to Allow U.S. Poultry Product Imports

U.S. officials have announced the government of Morocco has agreed to allow commercial imports of U.S. poultry meat and products into that nation for the first time.

The United States is the world’s second largest poultry exporter, with global sales of poultry meat and products of $4.3 billion last year.  

Initial estimates indicate Morocco would be a $10 million market, with additional growth over time.  Morocco earlier had prohibited imports of U.S. poultry. 

Officials from the Office of the U.S. Trade Representative and the U.S. Department of Agriculture worked with the Moroccan government to provide assurances on the safety of U.S. poultry. 



Spending Down on Federal Food Programs

Federal spending on 15 domestic food and nutrition assistance programs totaled $98.6 billion in fiscal 2017, 4 percent less than the previous fiscal year and almost 10 percent less than the historical high of $109.2 billion set in fiscal 2013.

USDA administers the programs that together form a nutritional safety net for millions of children and low-income adults.

Fiscal 2017’s decline likely was due primarily to continued growth in the U.S. economy.

Spending for the Supplemental Nutrition Assistance Program (SNAP), which accounted for 69 percent of federal food and nutrition assistance spending in fiscal 2017, totaled $68.0 billion, or 4 percent less than in fiscal 2016 and 15 percent less than the historical high of $79.9 billion set in fiscal 2013.

Outlays for the Special Supplemental Nutrition Program for Women, Infants and Children (WIC) fell to $5.6 billion in fiscal 2017, 6 percent less than in fiscal 2016.

Spending on the three largest child nutrition programs – the National School Lunch Program, the School Breakfast Program, and the Child and Adult Care Food Program – remained about the same.


Loans, Grants Announced for Two Alabama Communities

Two Alabama communities will receive funds from USDA’s rural development for upgrades to water and waste disposal facilities.

The Beulah Utilities District will receive a $1.229 million grant and a $4.42 million loan to replace 8.3 miles of water mains, install two elevated water storage tanks and improve a booster pump station.

The City of Sampson will receive a $935,000 grant and a $1.585 million loan to add 52,500 feet of eight-inch water line and 41,700 feet of six-inch line to connect some 140 homes now on individual wells. The city also will install a new well to meet the increase in demand.

The Alabama grants and loans are part of 103 projects in 35 states in rural communities with 10,000 or fewer residents. The projects total $267 million.

USDA is encouraging rural communities and water districts to apply for loans to rebuild infrastructure. Four billion dollars is available in the program.



Surplus Sugar Stocks Increasing

Favorable growing conditions in South and Southeast Asia have raised global sugar production forecasts for the 2017/18 marketing year, increasing the estimated production surplus for the global sugar market to its highest level in several decades.

Production surplus can be defined as global sugar production minus the amount of sugar consumed each year. A positive production surplus results in rising stocks of sugar held in storage around the world, which puts downward pressure on global sugar prices.

Production in 2018/19 is projected to decrease from the previous year but still be sizable by historical standards due to higher production forecasts for India and Thailand in particular. As a result, supplies are projected to outpace use and increase global stocks-to-use ratios, limiting opportunities for price increases in world sugar futures markets, which have been falling since October 2016.

The average world futures contract price in the April-to-June quarter was 11.91 cents per pound, 21.5 percent lower than the previous year.


Views on Trade Policies Differ Widely

If you want to know the consensus on President Donald Trump’s plan to deal with trade inequities by levying tariffs on various products from China and other nations, be assured you can find viewpoints to match whatever bias you may have on the subject.

A review of news releases, interviews and reports from a variety of sources shows there is no lack of opinions out there.

Not surprisingly, the President is putting his actions in a favorable light with his own statements and those from key officials such as Secretary of Agriculture Sonny Perdue, U.S. Trade Representative Robert Lighthizer, Republican Members of Congress and some farm organization leaders.

A careful reading of some statements from those outside government suggests those making them wanted to acknowledge the goals of the Administration’s policies without giving them an outright endorsement. Similarly, some farm leaders have expressed thanks for the Administration’s announced $12 billion program to alleviate the impact on producers from retaliatory actions against U.S. farm commodities while also noting their goals are long-term trade agreements and expanded markets.

But there’s the other side, too, with even some conservative news media carrying reports about the crippling effects of trade wars, lost markets and downward pressure on commodity prices. With support from many farm groups, the bipartisan Farmers for Free Trade organization has been actively reporting critical comments and questions raised in the media and by their own members.

The impact of the trade policies on Mr. and Mrs. John Q. Citizen also depends on who’s doing the talking. There are stories about U.S. businesses being revived because tariffs on goods from unfair trading partners have enabled them to compete again. But there also are warnings about higher consumer prices on everything from imported electronics to canned beverages.

Barring a sudden end to the trade dispute, which most observers don’t anticipate, the best measure of public reaction likely will be the results of the November midterm elections.