News & Media

Market Briefs for September 7, 2017

Dicamba recommendations
On Aug. 24, the Dicamba Task Force made the following recommendations: 1) Set an April 15 cut-off date for use of dicamba for the 2018 season; 2) revisit this date for 2019; 3) fix the regulations as they are now concerning penalties for violators of dicamba misuse to remove the requirement for proof of damage; and 4) request more independent/university testing before new products come to market. These recommendations will now be sent to the Pesticide Committee for consideration. If approved, they must then be approved by the full board, then the governor and Legislative Council, before the rule can take effect.

Harvey wallops Texas cotton
While most of Texas’s cotton crop was harvested along the southern Texas coast, modules storing crops in fields have “pretty much been destroyed” by Hurricane Harvey, Sid Miller, the state’s agriculture commissioner, said in a telephone interview with Bloomberg. “If they didn’t have the cotton to the gin, they probably lost it, even though it had been harvested,” he said, noting the best estimate to date is around $150 million damage in the coastal plains region.

Delay on lumber duty decision
The U.S. Department of Commerce will postpone its final determination for anti-dumping and countervailing duties on Canadian softwood lumber until Nov. 14, the department said. The decision was initially expected the first week of September, but the two nations remain at an impasse in the lengthy dispute.

“I remain hopeful that we can reach a negotiated solution that satisfies the concerns of all parties,” Commerce Secretary Wilbur Ross said in a statement. “This extension could provide the time needed to address the complex issues at hand and to reach an equitable and durable suspension agreement.”

Tensions escalated in April when the Trump administration imposed preliminary countervailing duties of as much as 24 percent on Canadian imports. Additional duties of as much as 7.7 percent followed in June.

Brazilian soybean acreage rising
Brazil’s soybean acreage will likely climb 2.3 percent in 2017-18 as bean acres take over ground previously planted to corn, according to analysts polled by Reuters. But the survey participants expect production to fall shy of the record-setting 2016-17 season as yields return to more normal levels. On average, survey participants projected a 2017-18 bean crop of 110.6 MMT (down 3 percent from the year prior) on plantings of 85.7 million acres. The 2016-17 crop is estimated at 114 MMT.

Brazil to tax U.S. ethanol
Camex, Brazil’s foreign trade chamber, last week approved a 20 percent tax on any ethanol imports in excess of a 600-million-liter, tax-free quota, its ag minister, Blairo Maggi, confirmed via Twitter. The move is meant to protect domestic producers against rising shipments from the United States.

For the first half of 2017, Brazil imported 1.29 billion liters of ethanol (1.045 billion liters from the U.S.), a 330 percent surge from the year prior. Brazil’s action ends an agreement with the U.S. to keep global ethanol trade free of taxes. The tax will remain in place for two years, at which point it will be re-evaluated.

China’s beef appetite growing
Beef is now the fastest-growing meat in China, with consumer food safety fears subsiding amid strict inspections and Chinese people looking to move away from pork to reduce fat in their diets. Domestic demand has been unable to keep up, plus it’s getting more expensive to raise cattle in China. Therefore, Beijing has opened its market to beef from the U.S., South Africa and Ireland this year and is considering bringing in beef from Namibia.

Last year China imported 800,000 MT of beef, making it the second largest importer of beef after the United States. China’s beef and veal consumption has climbed more than 10 percent during the past five years, while consumption of chicken and pork have declined.

Chinese corn, soybean imports
China imported 910,000 MT of corn in July, the fourth highest figure on record, according to customs data from Beijing. This represented a 238 percent surge from June and an even more dramatic climb from purchases of 28,985 MT in July 2016. Furthermore, China imported nearly 10.081 MMT of soybeans in July, a 29.92 percent gain from June, with Brazil as its top supplier, followed by Argentina. So far this year, China has imported 54.890 MMT of the oilseed, a gain of 16.79 percent from last year at this point. The U.S. has supplied it with 19.562 MMT of that business, up 20.09 percent from a year ago.

Tax rebate
As a reminder, farmers are eligible to receive a refund for local taxes paid on parts and labor on purchases in excess of $2,500. To receive the rebate producers should download the ET-179A form from the Arkansas Department of Finance and Administration web page, Enter “et179a” in the website search box, and a link to the form will pop up. A link also can be found by Googling “et179a.”