DTN Ag Headlines

DECATUR, Ill. (DTN) -- The word "distancing" is fraught with meaning this spring, but space between fields offers a way to manage some weather risk for farmers such as Ryan Jenkins and Reid Thompson.

There's about 20 miles as the crow flies between the Jenkins Farms base in Jay, Florida, and their farthest-most field location across the Alabama state line. This week some of those far-flung fields received just enough rainfall to dispatch planters northward, while the main farm continued to need a drink.

Thompson Farms, based in Colfax, Illinois, faced the opposite situation this past week. Rain hammered some fields, but the sprayer was still able to run since their operations are stretched over a distance of 45 miles.

"This week I was able to find a dry field and sprayed about 200 acres before we got rained out there, but some done is better than none," said Thompson.

Jenkins and Thompson are participating in DTN's View From the Cab project, a weekly series that looks at crop conditions and some aspects of farm life. Their reports will be posted each Wednesday throughout the growing season.

DTN Senior Ag Meteorologist Bryce Anderson said it sometimes seems surprising that one field can get a deluge and nary a drop falls on another. At times you can even see what seems to be a shower curtain of rainfall dividing fields.

"We know that rainfall is always not going to be 100% uniform over a given area. However, there are different atmosphere dynamics that can lead to either more consistent activity or scattered activity," said Anderson.

"A stationary frontal boundary draped west to east across the Midwest or along the Gulf Coast offers very similar moisture flow across the boundary zone from the Gulf of Mexico and can lead to widespread rain of similar intensity and volume.

"In contrast, a cold front moving from northwest to southeast will quite likely induce heavy rain in advance of the front and much lighter rain after the frontal passage. And finally, even in the presence of a hot summertime high-pressure dome, there can still be localized pockets of convection, which can bring very scattered bouts of pop-up thunderstorm activity with a lot of variance in precipitation from these widely scattered cells," Anderson explained.

While farming different localities may lead to weather risks and rewards, both farmers rank access to land as the main reason they have taken on fields far from home.

Moving away from the main headquarters isn't always ideal and can bring up all sorts of challenges to efficiency, noted Jenkins. "The logistics part of farming is the hardest thing I do. Getting everything where we need to be and figuring out where we can do what and when is complicated enough, but more so when you are stretched out and particularly when labor is short. I don't have someone that can just be a runner.

"I long for the days I can just sit in the tractor and not worry about the logistics of making sure everything is in the right place," he said.

Read on to learn more about how they juggle to keep machines moving and how the crop is shaping up in their parts of the world this week:

REID THOMPSON -- COLFAX, ILLINOIS

Rental land is hard to come by in Reid Thompson's immediate area, so the family has always been willing to travel to gain acreage. "Fortunately, we can move on main highways fairly easily and don't have many township roads," said Thompson, who farms in Illinois' Ford and McLean counties.

Typically, Thompson said, they prefer to work in one area and progressively move on, but this year is starting to test the system. Over the Memorial Day weekend, his fields averaged from 0.5 inch to more than an inch in rainfall. The problem is some of those rains came hard and fast.

"We had fields get an inch of rain in less than an hour," he reported. "There's a long-range forecast of more precipitation nearly every day this week, so we'll have to be checking for workable spots."

Weeds wait for nothing and Thompson likes to be timely with postemergence corn products. In addition to rain delays, wind has also narrowed the number of available spray days this season.

He uses a network of family, friends, weather stations and an app from Climate Corporation to monitor field conditions before moving equipment long distances.

"We are mapping everything -- even our sprayer. That really helps us keep track of what has been done. If we have to leave a field, the as-planted map is a great tool when we come back to finish," he said.

While he is not planning to spray dicamba this year, they did use the herbicide last year. "We were able to use those maps and drop a color-coded pin as to what neighbors had sensitive crops nearby. Those little things really make life easier," Thompson said.

He still has 500 acres of seed beans because the seed has yet to be delivered. "It feels weird to be spraying corn post and we still have beans to plant," he said.

Those seed beans are a new (and not currently available on the market) triple-stacked glyphosate, dicamba, glufosinate variety and will be sprayed with Liberty postemergence. "That's fortunate because, at this rate, the state June 20 dicamba cutoff would be iffy," he noted. Illinois has a special needs spray date in place that exceeds the federal label.

According to the most recent USDA NASS Crop Progress report, Illinois corn planting reached 89% on May 24 compared to 32% in 2019 and 82% for the five-year average. Corn emerged was at 66% compared to 17% last year and the five-year average of 69%. Soybeans were 65% planted compared to 13% last year and the 56% five-year average.

"Our corn looks really good -- ranging from spike to V-3. The corn planted April 9 was showing accumulation of 300 heat units and corn planted near the end of the month about half that," he reported.

Rainfall was welcome in those fields where hard rains had caused some crusting. "The sunshine is going to bring this corn along. I'd say we're looking at 90% to 95% stands consistently on our April corn with the exception of the occasional wet hole," he added. "We've going to have some small amount of corn replant in areas that washed or ponded. We're assessing those as we spray to know where we need to fill in," he said.

Thompson said early planted beans are working to put on the second-trifoliate. Those planted in late April are just starting to emerge.

Having ground in various areas proved a plus in the 2019 season. "We had a mini drought where we live. Our ground to the east had a better rainfall pattern, and land to the west had slightly above-average rainfall. I keep telling Dad we need to dip a few miles further south into that really black soil where everything is always perfect and it rains every time you need it," he joked.

RYAN JENKINS -- JAY, FLORIDA

"Can you hear me now?" Ryan Jenkins shouted as he climbed higher onto equipment and held his phone aloft to talk.

Jenkins could easily do a rural version of the Verizon commercial as cell service gets more than a little sketchy in some of the places he farms.

The Jay, Florida, farmer has fields in three distinct areas with each sitting about 10-20 miles apart. "Here, communication is one of the big problems with distance farming," he said.

"It just seems like every time we have a breakdown it is in one of those areas. While we still have radios in the tractors, not being able to reliably call the closest dealer for a part is a pain," Jenkins said.

This spring has held some tense moments for Jenkins as he waited for more moisture to fall before planting cotton and peanuts. This week he moved his entourage to the Alabama fields because there had been showers.

"When we got there, we determined it was still too dry, but we were able to move 7 miles down the road to an area that had a bit more rain. We planted a few acres there, then had a breakdown. We left to go get parts and it rained an inch, which was too much to continue. However, the place we'd just left was now just right and we moved back to that area again," he said.

It's enough to make anyone dizzy, to which Jenkins lightheartedly responds: "It's still better than a real job."

With about 80% of his crop planted, there's hope for a finish line. On Tuesday, he finally got a dose of precipitation at the main farm. "We've got a 40% to 50% chance [of rain showers] forecast all week, but you've just got to be under one for it to help you. Your neighbor might get an inch and you not get any," he said.

Scouting takes on urgency in the coming week as the crop begins to gain a foothold. He's already had to spray some cotton for grasshoppers, and thrips are now on the radar. Deer damage is also something he watches for.

"This week we'll be doing stand counts and seeing if any replant is required before we put the planter away," he said.

Peanuts are a fairly hardy crop, Jenkins said. Scouting gets intense later in the season when leaf eaters such as armyworms and loopers can work on the vegetation.

"If you lose the leaves, you lose the peanuts. That's why we worry a lot about fungicides. Leaf diseases that result in premature leaf loss will cause the peanuts to fall off underground and you can't dig or harvest them.

"Keeping the canopy on top of the ground really healthy is a must," he said. His peanut crop will average seven fungicide treatments per season. He is testing new fungicides that promote longer residuals of up to 30 days.

"It's hard to trust that, when your whole career you've been spraying fungicides every 10 to 14 days," he said.

The last few years, planting seasons have been stressful, Jenkins admitted. "There's such an urgency to get done. But we went through the same thing last year and planted really late because it was too dry."

Those "late" fields planted in mid-June 2019 turned out to be some of his best yields. "Sometimes what you think is going to be a disaster in the early spring turns out to be some of your best crop and your best work.

"There are no cut-and-dry dates in agriculture. Every year is a different year, and no matter how it starts, you never know how it is going to finish," he said.

Pamela Smith can be reached at pamela.smith@dtn.com

Follow her on Twitter @PamSmithDTN

DECATUR, Ill. (DTN) -- The word "distancing" is fraught with meaning this spring, but space between fields offers a way to manage some weather risk for farmers such as Ryan Jenkins and Reid Thompson.

There's about 20 miles as the crow flies between the Jenkins Farms base in Jay, Florida, and their farthest-most field location across the Alabama state line. This week some of those far-flung fields received just enough rainfall to dispatch planters northward, while the main farm continued to need a drink.

Thompson Farms, based in Colfax, Illinois, faced the opposite situation this past week. Rain hammered some fields, but the sprayer was still able to run since their operations are stretched over a distance of 45 miles.

"This week I was able to find a dry field and sprayed about 200 acres before we got rained out there, but some done is better than none," said Thompson.

Jenkins and Thompson are participating in DTN's View From the Cab project, a weekly series that looks at crop conditions and some aspects of farm life. Their reports will be posted each Wednesday throughout the growing season.

DTN Senior Ag Meteorologist Bryce Anderson said it sometimes seems surprising that one field can get a deluge and nary a drop falls on another. At times you can even see what seems to be a shower curtain of rainfall dividing fields.

"We know that rainfall is always not going to be 100% uniform over a given area. However, there are different atmosphere dynamics that can lead to either more consistent activity or scattered activity," said Anderson.

"A stationary frontal boundary draped west to east across the Midwest or along the Gulf Coast offers very similar moisture flow across the boundary zone from the Gulf of Mexico and can lead to widespread rain of similar intensity and volume.

"In contrast, a cold front moving from northwest to southeast will quite likely induce heavy rain in advance of the front and much lighter rain after the frontal passage. And finally, even in the presence of a hot summertime high-pressure dome, there can still be localized pockets of convection, which can bring very scattered bouts of pop-up thunderstorm activity with a lot of variance in precipitation from these widely scattered cells," Anderson explained.

While farming different localities may lead to weather risks and rewards, both farmers rank access to land as the main reason they have taken on fields far from home.

Moving away from the main headquarters isn't always ideal and can bring up all sorts of challenges to efficiency, noted Jenkins. "The logistics part of farming is the hardest thing I do. Getting everything where we need to be and figuring out where we can do what and when is complicated enough, but more so when you are stretched out and particularly when labor is short. I don't have someone that can just be a runner.

"I long for the days I can just sit in the tractor and not worry about the logistics of making sure everything is in the right place," he said.

Read on to learn more about how they juggle to keep machines moving and how the crop is shaping up in their parts of the world this week:

REID THOMPSON -- COLFAX, ILLINOIS

Rental land is hard to come by in Reid Thompson's immediate area, so the family has always been willing to travel to gain acreage. "Fortunately, we can move on main highways fairly easily and don't have many township roads," said Thompson, who farms in Illinois' Ford and McLean counties.

Typically, Thompson said, they prefer to work in one area and progressively move on, but this year is starting to test the system. Over the Memorial Day weekend, his fields averaged from 0.5 inch to more than an inch in rainfall. The problem is some of those rains came hard and fast.

"We had fields get an inch of rain in less than an hour," he reported. "There's a long-range forecast of more precipitation nearly every day this week, so we'll have to be checking for workable spots."

Weeds wait for nothing and Thompson likes to be timely with postemergence corn products. In addition to rain delays, wind has also narrowed the number of available spray days this season.

He uses a network of family, friends, weather stations and an app from Climate Corporation to monitor field conditions before moving equipment long distances.

"We are mapping everything -- even our sprayer. That really helps us keep track of what has been done. If we have to leave a field, the as-planted map is a great tool when we come back to finish," he said.

While he is not planning to spray dicamba this year, they did use the herbicide last year. "We were able to use those maps and drop a color-coded pin as to what neighbors had sensitive crops nearby. Those little things really make life easier," Thompson said.

He still has 500 acres of seed beans because the seed has yet to be delivered. "It feels weird to be spraying corn post and we still have beans to plant," he said.

Those seed beans are a new (and not currently available on the market) triple-stacked glyphosate, dicamba, glufosinate variety and will be sprayed with Liberty postemergence. "That's fortunate because, at this rate, the state June 20 dicamba cutoff would be iffy," he noted. Illinois has a special needs spray date in place that exceeds the federal label.

According to the most recent USDA NASS Crop Progress report, Illinois corn planting reached 89% on May 24 compared to 32% in 2019 and 82% for the five-year average. Corn emerged was at 66% compared to 17% last year and the five-year average of 69%. Soybeans were 65% planted compared to 13% last year and the 56% five-year average.

"Our corn looks really good -- ranging from spike to V-3. The corn planted April 9 was showing accumulation of 300 heat units and corn planted near the end of the month about half that," he reported.

Rainfall was welcome in those fields where hard rains had caused some crusting. "The sunshine is going to bring this corn along. I'd say we're looking at 90% to 95% stands consistently on our April corn with the exception of the occasional wet hole," he added. "We've going to have some small amount of corn replant in areas that washed or ponded. We're assessing those as we spray to know where we need to fill in," he said.

Thompson said early planted beans are working to put on the second-trifoliate. Those planted in late April are just starting to emerge.

Having ground in various areas proved a plus in the 2019 season. "We had a mini drought where we live. Our ground to the east had a better rainfall pattern, and land to the west had slightly above-average rainfall. I keep telling Dad we need to dip a few miles further south into that really black soil where everything is always perfect and it rains every time you need it," he joked.

RYAN JENKINS -- JAY, FLORIDA

"Can you hear me now?" Ryan Jenkins shouted as he climbed higher onto equipment and held his phone aloft to talk.

Jenkins could easily do a rural version of the Verizon commercial as cell service gets more than a little sketchy in some of the places he farms.

The Jay, Florida, farmer has fields in three distinct areas with each sitting about 10-20 miles apart. "Here, communication is one of the big problems with distance farming," he said.

"It just seems like every time we have a breakdown it is in one of those areas. While we still have radios in the tractors, not being able to reliably call the closest dealer for a part is a pain," Jenkins said.

This spring has held some tense moments for Jenkins as he waited for more moisture to fall before planting cotton and peanuts. This week he moved his entourage to the Alabama fields because there had been showers.

"When we got there, we determined it was still too dry, but we were able to move 7 miles down the road to an area that had a bit more rain. We planted a few acres there, then had a breakdown. We left to go get parts and it rained an inch, which was too much to continue. However, the place we'd just left was now just right and we moved back to that area again," he said.

It's enough to make anyone dizzy, to which Jenkins lightheartedly responds: "It's still better than a real job."

With about 80% of his crop planted, there's hope for a finish line. On Tuesday, he finally got a dose of precipitation at the main farm. "We've got a 40% to 50% chance [of rain showers] forecast all week, but you've just got to be under one for it to help you. Your neighbor might get an inch and you not get any," he said.

Scouting takes on urgency in the coming week as the crop begins to gain a foothold. He's already had to spray some cotton for grasshoppers, and thrips are now on the radar. Deer damage is also something he watches for.

"This week we'll be doing stand counts and seeing if any replant is required before we put the planter away," he said.

Peanuts are a fairly hardy crop, Jenkins said. Scouting gets intense later in the season when leaf eaters such as armyworms and loopers can work on the vegetation.

"If you lose the leaves, you lose the peanuts. That's why we worry a lot about fungicides. Leaf diseases that result in premature leaf loss will cause the peanuts to fall off underground and you can't dig or harvest them.

"Keeping the canopy on top of the ground really healthy is a must," he said. His peanut crop will average seven fungicide treatments per season. He is testing new fungicides that promote longer residuals of up to 30 days.

"It's hard to trust that, when your whole career you've been spraying fungicides every 10 to 14 days," he said.

The last few years, planting seasons have been stressful, Jenkins admitted. "There's such an urgency to get done. But we went through the same thing last year and planted really late because it was too dry."

Those "late" fields planted in mid-June 2019 turned out to be some of his best yields. "Sometimes what you think is going to be a disaster in the early spring turns out to be some of your best crop and your best work.

"There are no cut-and-dry dates in agriculture. Every year is a different year, and no matter how it starts, you never know how it is going to finish," he said.

Pamela Smith can be reached at pamela.smith@dtn.com

Follow her on Twitter @PamSmithDTN

OMAHA (DTN) -- Retail fertilizer prices continued to float between slightly higher and slightly lower than last month during the third week of May 2020, according to retailers surveyed by DTN.

This marks the seventh consecutive week prices have not moved a significant amount, which DTN designates as 5% in either direction.

Once again, five fertilizers were higher in price compared to last month, but the gains were contained to a $1-$2 range. MAP had an average price of $434 per ton, urea $387/ton, 10-34-0 $469/ton, UAN28 $237/ton and UAN32 $280/ton.

The remaining three fertilizers had a slightly lower price. DAP had an average price of $409/ton, down $1; potash $367/ton, down $3; and anhydrous $490/ton, down $2.

On a price per pound of nitrogen basis, the average urea price was at $0.42/lb.N, anhydrous $0.30/lb.N, UAN28 $0.42/lb.N and UAN32 $0.44/lb.N.

In article from May 18 titled "Managing Fertilizer Costs in Times of Economic Uncertainty" by Alabama Cooperative Extension System (ACES), author Audrey Gamble said crop producers need to manage inputs efficiently. She listed six main areas to focus on during indeterminate times.

The first is to use research-based soil test recommendations. Decades of research has been done to correlate soil-extractable nutrients with increase in yield to develop fertilizer recommendations for Alabama crops, she wrote.

Another area is to use soil sampling strategies to account for field variability.

Gamble wrote that farmers also need to be realistic about their yield goals. Nitrogen recommendations for corn, for instance, will vary according to the anticipated yield.

"The most profitable fertilizer rate was not necessarily the rate at which the yield was maximized," Gamble wrote. "Be realistic about yield potential in a given field to determine fertilizer rates and maximize economic potential."

Producers also should compare nutrient rates in fertilizer products. While this is obvious for macronutrients, the price per unit of nutrient is often overlooked for less frequently applied nutrients, such as calcium and boron.

Other recommendations include making soil pH a priority and implementing a plant tissue sampling program to ensure adequate nutrients are present for crop growth.

To read the entire ACES report, click on the following link: https://www.aces.edu/….

Retail fertilizers are all lower in price from a year ago. MAP, DAP and anhydrous are all 18% less expensive, UAN28 is 12% lower, UAN32 is 11% less expensive, urea is 10% lower, potash is 6% lower and 10-34-0 is 4% less expensive from last year at this time.

DTN collects roughly 1,700 retail fertilizer bids from 310 retailer locations weekly. Not all fertilizer prices change each week. Prices are subject to change at any time.

DTN Pro Grains subscribers can find current retail fertilizer price in the DTN Fertilizer Index on the Fertilizer page under Farm Business.

Retail fertilizer charts dating back to 2010 are available in the DTN fertilizer segment. The charts included cost of N/lb., DAP, MAP, potash, urea, 10-34-0, anhydrous, UAN28 and UAN32.

DRY
Date RangeDAPMAPPOTASHUREA
May 20-24 2019497527392428
Jun 17-21 2019496532392435
Jul 15-19, 2019497532392430
Aug 12-16 2019493503387413
Sep 9-13 2019486482385407
Oct 7-11, 2019472473383403
Nov 4-8 2019462471384396
Dec 2-6 2019445463379381
Dec 30-Jan 3 2020438446376363
Jan 27-31 2020414435373359
Feb 24-28 2020409434371366
Mar 23-27 2020409434370382
Apr 20-24 2020410433370385
May 18-22 2020409434367387
LIQUID
Date Range10-34-0ANHYDUAN28UAN32
May 20-24 2019487595270314
Jun 17-21 2019487589270318
Jul 15-19, 2019485585275317
Aug 12-16 2019475543258295
Sep 9-13 2019471516253289
Oct 7-11, 2019470509253289
Nov 4-8 2019473499249289
Dec 2-6 2019470490242276
Dec 30-Jan 3 2020470487238273
Jan 27-31 2020467488237275
Feb 24-28 2020466490235277
Mar 23-27 2020466491235278
Apr 20-24 2020468492236279
May 18-22 2020469490237280

Russ Quinn can be reached at russ.quinn@dtn.com

Follow him on Twitter @RussQuinnDTN

The Cattle on Feed (COF) report is something that most cattlemen know about but only few study and thoroughly understand. Given that the report is a recap of the previous month's happenings, when the percentage only changes by a couple of points, most cattlemen can shrug off its relevance and continue with their day-to-day business. Seeing that the last two COF reports have differed upwards of 22% to 23% compared to placements in 2019, the recap of the reports may hold tangible information about the upcoming fall feeder cattle market.

There's no denying that the two latest COF reports have been plagued (like everything else in our lives and in the marketplace) by COVID-19. Significantly fewer placements have gone into feedlots and, concerningly, fewer fat cattle have left feedlots when they reached their prime. The April COF report shared that placements for the month of March totaled 1.56 million head -- down 23% from 2019, the lowest placements ever for the month of March since the series began back in 1996. May's COF report shared that placements for April totaled 1.43 million head -- down 22% from 2019 and the second lowest that April placements have ever been since 1996.

As cow-calf producers start to kick pairs out to grass and begin to wonder what their fall calves will weigh up to be -- and what prices will ring the top of the market -- producers need to know that this fall's market will be a timing game. Hitting the market at the most financially rewarding time could be a balancing act of gauging when the backlog of cattle is processed. Right now there is a lull in production as fewer feeder cattle were placed this summer.

That brings up a ton of questions.

How many fat cattle are truly backed up? How much additional weight have those cattle put on? As packers try to increase capacity and get back to efficiently processing cattle, what's going to be the new standard for full-capacity, will it be 70%, 80%, 85%, 90% or fully steady with what it was before COVID-19? What will beef demand be as producers have recently experienced severe sticker shock, possibly leading consumers to other products? And what unknowns are still left to come down the pike?

Working through these questions is challenging as our industry has never dealt with something quite like this before. If we look at the current data provided and study how the market typically goes about its business, we can begin to grasp some of the realities of this upcoming fall.

When digging into the last two COF reports, it's interesting that both reports showed significantly lower placements for the 700-to-799-pound and 800-to-899-pound feeders. This may not seem that concerning, as it makes perfect sense that producers didn't want to put those feeders in feedlots and potentially have them become part of the backed-up supply. However, when looking down the road and comparing this year's numbers to last year's placement totals, the industry will be shy roughly 867,000 head in the next six to eight months, depending on the level of concentration in feed rations.

When fat cattle availability is limited, feeder cattle prices tend to be stronger as the need for getting more cattle on feed becomes a driving factor. In the last couple of weeks, sale barns have seen an uptick in prices as buyers are seeing green grass throughout the countryside and feeder cattle buyers have a hard time saying no to good deals. Even though the market may not be quite where producers would like to see it, it's not far off from being where prices have been in the last couple of years.

October Feeder Cattle Contract November Feeder Cattle Contract
5/26/2020$135.325/26/2020$135.97
10/31/2019$145.9511/29/2019$142.27
10/31/2018$153.4711/30/2018$145.22
10/31/2017$159.4211/30/2017$154.17

Moving forward it will be essential that cow-calf producers watch the market avidly and practice great discernment when it comes to marketing this year's calves. Keeping a close eye on slaughter progression, live cattle prices, carcass weights and the upcoming COF placements will help producers focus in on the best time to market their calves. In these unpresented times, relying on marketing strategies that worked in the past will not be enough.

Find the holes within the market and capture the opportunity.

ShayLe Stewart can be reached at shayle.stewart@dtn.com

(BE/SK )

OMAHA (DTN) -- China is increasing its purchases of key U.S. agricultural commodities even as political rhetoric between the two countries ramps up, but China isn't projected right now to come close to hitting its targets for ag buys under the phase-one trade deal.

Blaming China for the coronavirus pandemic to criticizing China's new law cracking down on protests in Hong Kong, U.S. lawmakers and officials in the Trump administration are lashing out at the country, while at the same time walking a fine line on the phase-one agreement signed back in January.

Larry Kudlow told reporters Thursday in Washington he and other administration officials had spoken recently with China's vice premier, who was the lead negotiator on the trade deal. "They reported to the president that the deal is intact, and China has every intent on implementing it," Kudlow said, according to the Wall Street Journal.

Kudlow acknowledged commodity purchases "are a little far behind" because of poor economic conditions, but the president's adviser said he is still satisfied overall with China's compliance with the agreement.

USDA and the U.S. Trade Representative's Office continue issuing progress reports on the trade deal. On Thursday, the agencies noted China has approved 2,085 U.S. beef, pork, poultry, seafood, dairy and infant formula facilities for exports -- the most in history. China also now will accept blueberries and avocadoes, as well as more barley and hay products.

"China is a market of tremendous potential for U.S. agriculture and these actions will help U.S. exporters expand their sales there," said Agriculture Secretary Sonny Perdue in a statement. "We look forward to continued cooperative work with China on implementation of phase-one commitments, and immediate increases in U.S. exports of all manner of agricultural products."

The phase-one target this year for agricultural sales is supposed to hit $36.6 billion, with overall exports listed at increasing as much as $200 billion. For the first three months of the year, China had only purchased $3.35 billion, which is about 2% below 2019 totals for the first quarter of the year, according to U.S. Census Bureau data on agricultural exports. U.S. ag exports to China are down sharply since hitting $23.8 billion in 2017 as the U.S. and China have slapped hundreds of billions of dollars in tariffs on each other since.

"The sales are a little more active, but it's nothing close to what we're talking about as far as phase-one targets," said DTN Lead Analyst Todd Hultman. "I don't think it's going to be anything close to 2017 levels. It's probably not going to be a lot different than what we have seen the past two years."

Jeffrey Schott, a trade policy expert at the Peterson Institute for International Economics, told DTN the agricultural target for sales was unrealistic to begin with, but the deal needed to be sold as a major victory for the president. "They are going to continue to buy farm goods because they need the farm goods, but they also know the targets that were set were unrealistic to begin with, and given the events since the deal was struck, they are not going to be able to meet the targets this [year] and likely not going to accelerate purchases to meet the two-year targets in 2021," Schott said.

Schott added the criticism of China by U.S. politicians will continue, but most Chinese leaders also understand U.S. political saber-rattling during an election year because they studied here.

"So it's a full-court press against China on the rhetorical front but at the same time they are saying China has told us they are going to keep the terms of the deal," Schott said.

To that end, Chinese Premier Li Keqiang on Friday gave an extensive speech before China's legislature spotlighting how the country will recover from the coronavirus economically. Li mentioned trade liberalization and reiterated China's commitment to the phase-one deal. "We will work with the United States to implement the phase-one China-U.S. economic and trade agreement," Li said. "China will continue to boost economic and trade cooperation with other countries to deliver mutual benefits."

The phase-one deal went into effect Feb. 14, so sale totals don't exactly mesh with USDA reports for the marketing year for crops, or meat products, but several commodities are showing greater demand than 2019, which was still in the midst of the tariff war. Still, exports would have to soar in the coming months to come close to achieving the phase-one promise. A big stumbling block there is Brazil, which just harvested a 4.5 billion bushel soybean crop.

"It looks like China's overall soybean demand is as strong as ever, but unfortunately for us they have been able to source a lot of it out of Brazil because Brazil had another big crop this year," Hultman said.

China is buying a few more commodities, though. For corn, China has more than 1 million metric tons (mmt) (39.4 million bushels) of outstanding sales for the 2019-20 crop still waiting for actual export, but China also has outstanding sales on 819,000 metric tons (mt) (32 mb) of the 2020-21 crop listed as well, according to USDA. Over the past four years, China had bought very little U.S. corn.

China's soybean purchases are up 9% from where they were a year ago. Soybean exports and outstanding sales to China right now are reported at 14.55 mmt, (534.6 mb) compared to 13.35 mmt (490 mb) a year ago. Actual physical shipments are significantly higher than 2019, but outstanding sales for the rest of the marketing year are less than last year.

"The bottom line as I see it, as long as Brazil keeps having big crops, we're behind the eight ball in this negotiation," said Hultman. "I just don't see China being pressured to take more beans or more ag products from us than what they need on their shopping list. That's kind of where we are relegated right now."

China also has dipped a little into the wheat market. After buying no U.S. wheat at this point a year ago, China has 225,000 mt (8.86 million bushels) listed as outstanding buys for the current market year and 455,000 tons (17.9 mb) for next year, according to USDA reports. For cotton, sales to China are up 47% from the last marketing year, which runs through the end of July. China last week bought 153,000 bales of 2019-20 crop and also 79,000 bales of new crop. While sales to China are up from 2019, they still lag behind the five-year average. A large share of China's purchases includes 1.71 million bales of old crop waiting in outstanding sales.

Due to African swine fever, pork exports are an area where China has made major strides compared to last year. Actual shipments and outstanding sales since January are at 458,000 tons, up 57% from 2019's reported sales at this time, according to USDA. Hides and skins sales to China also are up about 25% since the beginning of the year.

One of the problems with the higher sales volumes for U.S. commodities is they are coming at a lower price. The phase-one deal doesn't address the size of shipments, but dollar value. And prices are down for most major agricultural products.

"So if the prices are down that means you have to sell more product to make the target, and they are not even close," Schott said.

Chris Clayton can be reached at chris.clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

OMAHA (DTN) -- Idaho property owners Mike and Chantell Sackett will have a chance to have a court hear the merits of their Clean Water Act legal case, after a federal appeals court rejected an EPA motion to dismiss their appeal.

The EPA filed a motion on April 1 in the U.S. Court of Appeals for the Ninth Circuit in San Francisco to dismiss the case against the Sacketts. The Sacketts countered by filing a motion on April 9 opposing the motion to dismiss.

In 2012, the U.S. Supreme Court ruled in favor of the Sacketts in their lawsuit against the EPA, providing farmers and other landowners a legal leg to stand on when it comes to challenging Clean Water Act determinations. Prior to that ruling, landowners were unable to legally challenge determinations.

The EPA said in an April 3 statement to DTN the agency believes the case is closed.

The Sacketts argued in their April 9 court motion the EPA has yet to provide certainty about the future use of the property declared by EPA in 2008 to be a federally protected wetland.

"EPA has declined to date to clarify whether it continues to assert regulatory authority over the Sacketts' home site, or whether its intent 'not to issue a similar order in the future' will apply if the Sacketts proceed to build on the lot," the Sacketts' motion said.

"Without this clarification, the best reading of the March 13, 2020, letter is that EPA will not enforce against the Sacketts for their past action of clearing the lot but may do so if they take future action on the property."

The Sacketts have asked the court to declare the jurisdictional determination on their property violates the Clean Water Act and "fails to establish that the Sacketts' vacant lot is actually federally protected 'navigable waters.'"

In a March 13 letter from EPA's Susan Parker Bodine, assistant administrator for enforcement and compliance assurance, the agency said it withdrew the 2008 compliance order. The letter stated EPA had decided several years ago to no longer enforce the ACO against the Sacketts.

"Appellee EPA reports that it decided several years ago not to pursue civil enforcement against the Sacketts," the April 9 motion said.

"This is news to the Sacketts. The March 13, 2020, letter is the first time that decision was communicated. Instead of advising the Sacketts at the time, EPA held the decision for 'several years' -- until the eve of the deadline to file its brief in this appeal. EPA has failed to moot this case by withdrawing the compliance order on the eve of its briefing date, while leaving the underlying jurisdictional determination in place."

Until this April, the Sacketts continued to be subject to an administrative compliance order, or ACO, requiring them to come into compliance or face fines of up to $75,000 per day.

Landowners have often learned about EPA wetland determinations by mail, with little chance to challenge those decisions.

The Sacketts were told by EPA and the Ninth Circuit they could not get a direct court review of EPA's claim that a two-thirds-of-an-acre parcel on their land is wetlands and that they must follow an EPA compliance order.

In writing the opinion for the unanimous court, the late Supreme Court Justice Antonin Scalia said, "We conclude that the compliance order in this case is final agency action for which there is no adequate remedy other than APA (Administrative Procedure Act) review, and that the Clean Water Act does not preclude that review."

Yet, the Ninth Circuit later ruled against the Sacketts in their appeal challenging whether EPA ever proved there are wetlands on their property.

The Sacketts bought a small parcel in 2005 with the intent to build a home.

They obtained a county permit to build, but EPA claimed the property is wetlands and ordered the couple to return the land to what EPA said was its original state or pay penalties -- all without the ability to challenge EPA's wetland ruling.

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @toddneeleyDTN

By Chris Clayton
DTN Ag Policy Editor
and
Jerry Hagstrom
DTN Political Correspondent

GLENWOOD, Iowa (DTN) -- USDA is set to begin accepting applications Tuesday from crop growers and livestock producers for $16 billion in aid under the Coronavirus Food Assistance Program (CFAP).

Cattle producers who typically do not receive direct federal aid have had more questions about enrolling in the program. Leadership from the U.S. Cattlemen's Association held a question-and-answer session Friday evening on Facebook to discuss the CFAP and some of the shortfalls in the program for cattle producers.

"It definitely falls short and leaves us scratching our heads why things are the way they are," said Justin Tupper, USCA's vice president and a South Dakota cattle producer.

County FSA offices are open by phone-call appointment only due to the coronavirus pandemic, but application forms are supposed to be available online "once signup begins," USDA said in a news release last week.

"The FSA is not equipped to handle all of these ranchers they are going to get Tuesday morning," Tupper said. He added, "There is going to be a cumbersome process as we get this thing started."

CFAP pays cattle producers $214 a head for fat cattle sold from Jan. 15 to April 15. Feeder cattle sold at that time are split at 600 pounds with those over that weight receiving $139 a head and those under receiving $102 a head. Slaughter cows and bulls are paid $92 a head and all other cattle sold at that time are worth $102 a head. Under the rules, any cattle sold during the Jan. 15 to April 15 timeframe should be eligible for payment, but producers will have to provide some documentation of the sale.

Unpriced cattle in inventory from April 16 to May 14 receive a flat rate from the Commodity Credit Corp. of $33 a head. Producers are expected to pick a date in that timeframe when their inventory was highest. From the reading of the program rules, that inventory count should include spring calves, Tupper said.

Brett Crosby of Custom Ag Solutions in Cowley, Wyoming, said on the USCA event that the decision to pick Jan. 15 as the start date for the program is confusing because the cattle market really did not begin to negatively react to COVID-19 until closer to mid-March. From Jan. 15 to March 15, fed cattle were averaging $122 per cwt, he noted.

Yet, the inventory price of $33 a head starting April 16 coincides with when cattle feeders actually could not begin to move their cattle to slaughter. Cash bids in a lot of places were halted, Crosby noted, and fed-cattle prices fell to an average of $105 per cwt. For roughly three weeks straight, 91% of all cattle slaughtered were sold on formula "and the cash trade was left out in the cold," Crosby said.

On the $250,000 payment limit, Tupper said USCA leaders were "semi-comfortable" that this will provide help to smaller and medium feedlots. Crosby noted though, that a 12,000-head feedlot would market roughly 3,000 head each quarter, and feedyards were losing roughly $400 a head. This could lead to potentially $1 million in losses.

There were also questions over why USDA chose to split the feeder cattle values at 600 pounds, but the assumption was that the department was trying to keep the program simple for FSA staff who have to administer it.

For hog producers, pigs sold from Jan. 15 to April 15 have a payment rate of $28 a head while hogs sold during that time have a payment rate of $18 a head. Unsold hog and pigs in inventory from April 16 to May 14 have a payment rate of $17 a head.

Under CFAP, once USDA determines a producer's payment, USDA will make a payment of up to 80% of the total within a week. Another 20% will be held back for later in the summer.

Producers of all eligible commodities will apply through their local FSA office. Documentation to support the producer's application and certification may be requested. FSA has streamlined the signup process to not require an acreage report at the time of application, and a USDA farm number may not be immediately needed. Applications will be accepted through August 28.

Producers will also have to certify they meet the Adjusted Gross Income limitation of $900,000 unless at least 75% or more of their income is derived from farming, ranching or forestry-related activities. Producers must also be in compliance with Highly Erodible Land and Wetland Conservation provisions.

Commodities that did not suffer a 5% or greater price decline from mid-January 2020 to mid-April 2020 are not eligible for CFAP. Specifically, this includes sheep more than two years old, eggs/layers, soft red winter wheat, hard red winter wheat, white wheat, rice, flax, rye, peanuts, feed barley, Extra Long Staple (ELS) cotton, alfalfa, forage crops, hemp, and tobacco. USDA may reconsider the excluded commodities if credible evidence is provided that supports a 5% price decline.

Producers who have issues with the structure of the program can still weigh in through the federal-rulemaking portal or by mail through June 22. Go to www.regulations.gov and search for Docket ID FSA-2020-0004. Follow the instructions for submitting comments. For mail, send to Director, SND, FSA, U.S. Department of Agriculture, 1400 Independence Avenue SW, Stop 0522, Washington, DC, 20250-0522.

More information on the CFAP, including ways to sign up, can be found at: www.farmers.gov/cfap

USDA also has produced a video for signing up on-line: https://www.youtube.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

Jerry Hagstrom can be reached at jhagstrom@nationaljournal.com

Follow him on Twitter @hagstromreport

This week's big news was USDA's explanation of how it would distribute funds to farmers through its Coronavirus Food Assistance Program (CFAP). I won't rehash it here, but the short story is that applications will be available at the Farm Service Agency on May 26. Producers should quickly participate to help cover some of the losses on 2019 production (see more at https://www.farmers.gov/…).

Wheat markets surprised us with double-digit gains Wednesday as weather concerns in the U.S. and Europe start to carry more weight. I talked about spring wheat's bullish potential two weeks ago in this space (https://www.dtnpf.com/…) and Wednesday's rally could spark more short-covering with funds sitting on record-large bearish bets.

Wednesday's higher close in July KC wheat didn't change the downtrend I mentioned last week. If adverse weather continues to worsen, the winter wheat market could get a lot more interesting.

Looking at row crops, there hasn't been much new of late. Corn demand remains bogged down by people not driving and slaughter plants operating at lower capacity. USDA's estimate of Brazil's corn crop remains near the record high of 3.98 billion bushels (bb) (101.0 mt).

Soybean demand could see some benefit from the loss of competing distillers grains in 2020. Overall, however, a slower slaughter pace resulting in the destruction of hogs and poultry has not been good news for meal demand. July soybean meal fell to a new contract low Thursday (May 21).

In addition to feed demand concerns, the trade dispute with China is as contentious as ever. President Donald Trump has threatened new tariffs on China if it doesn't start increasing U.S. ag purchases. On Tuesday, May 19, the president offered a more drastic alternative. FoxNews.com quoted the president as saying, "We could cut off the whole relationship."

An email from USDA on Thursday, May 21, sought to soften the tone, assuring us that progress was being made in implementing the phase-one agreement. U.S. Trade Representative Robert Lighthizer concluded, "Under President Trump's leadership, we fully expect this agreement to be a success." July soybeans finished the day down 11 3/4 cents.

Markets in 2020 are suffering a chronic case of constipation. U.S. soybean supplies are backed up without access to the world's largest buyer of soybeans. Reluctant to plant soybeans, the early intention of farmers was to plant more corn in 2020 until coronavirus interrupted those plans.

As people stayed home, ethanol production dropped and inventory swelled to record highs. Saudi Arabia increased crude oil production and U.S. oil supplies quickly taxed storage capacity. Coronavirus concerns shut down slaughter plants, causing livestock and poultry supplies to quickly reach unmanageable levels. Milk was poured on the ground as distribution channels shut down.

Everywhere we turned, the tremendous productive capacity of U.S. agriculture was being wasted, clogged in constipated channels of demand. To date, coronavirus concerns are slowly easing, but the threat of infection remains serious.

Now, 97.0 million acres of corn planting intentions are apt to become 94.0 million actual acres. Ethanol inventory has fallen back to pre-coronavirus levels. Crude oil inventory was down 5.0 million barrels last week, a small step in a more balanced direction.

Hog slaughter is back near 400,000 head per day, higher than it was, but still down 15% from a year ago. Class III milk prices have recovered from less than $11 in April to $17.62 on Thursday's close.

Improvements from an easing coronavirus threat appear to be happening slowly and presumably will take time. Other than finding a vaccine or treatment and people getting back to work, there is little more we can do to push things along.

The trade dispute with China, however, is a difficult choice worth reconsidering. It is not clear yet if the result will be worth the enormous cost. On May 12, USDA estimated Brazil's soybean exports will outpace the U.S. by 1.0 bb in 2020-21, the third consecutive annual gap of that size. That is a lot of business being left on the table.

Unless Brazil suffers adverse weather early next year, the export gap will likely be more than 1.0 bb in 2020-21. USDA's 2.05 bb estimate of U.S. exports in 2020-21 is highly unlikely without China's cooperation. To date, China has shown no sign of succumbing to whatever pressures tariffs are exerting. The commercial consideration clause in the phase-one agreement is a good example of how China refuses to bind itself to any solid purchase commitments.

The larger tragedy is that, among the big three U.S. crops, soybeans has been the clear leader in terms of world demand growth for decades. Even as China lost hogs to African swine fever, world soybean demand continued to rise to new record highs. USDA expects another year of record demand in 2020-21, nearly 4% higher than the current season.

Instead of being an unnecessary source of demand constipation, the world's growing soybean market offers U.S. producers the best chance for increased profitability and could ease the bearish strain on other crops.

I don't know how to stop China from stealing high-tech secrets, but I do understand why many economists don't favor higher tariffs. Surely there's a better way to get the U.S. back in the business of selling soybeans again.

After seeing the ag economy hit by the coronavirus, I am thankful for our farmers that CFAP is going to provide some welcome relief. I wish, for all our sakes, we could also find a way to open international trade for soybeans again.

Todd Hultman can be reached at Todd.Hultman@dtn.com

Follow him on Twitter @ToddHultman

OMAHA (DTN) -- When Karen Eifert Jones had to complete online training to spray dicamba herbicide this spring, she ended up doing it on her cell phone from the driveway of her mother's house.

She was trying to maintain social distance from her 87-year-old parent, but still use the broadband internet. "My 17-year-old daughter was doing schoolwork at our house, so I went to Mom's driveway to make it work," Eifert Jones said.

As for the distance between where Eifert Jones farms with her family near Waukomis, Oklahoma, and that of her mother? About a mile.

Her mother has access to broadband internet. Eifert Jones and her family do not. They do have an antenna-based internet connection from their house; however, with more people using the service in recent months, the competition for bandwidth slowed it down, she explained.

Eifert Jones doesn't know why broadband access is available at her mother's house but not at her own house. The local phone company buried the fiber line only so far, she figured.

As many rural residents without broadband do so often, they had to go in search of high-speed internet. This spring, the search became more critical.

MAJOR ADJUSTMENT DURING PANDEMIC

The last two months forced many people to work from home and kids to learn from home during the COVID-19 pandemic. This sudden change in everyday life was a major adjustment for workers, employers, students and teachers.

Those who live in rural areas faced these challenges with another big issue: lack of high-speed internet often referred to as broadband internet. While some areas have seen fiber optic lines installed, others attempted to work or learn from home with less consistent options for internet access.

As the school year wraps up for most students, those in rural areas look back at this spring and wonder how they did it.

People hope they can return to actual offices soon and students to schools this fall.

However, the pandemic highlighted shortcomings of internet access in rural areas and what needs to change, especially if a need for people to work or learn from home remains or returns this fall.

OTHER INTERNET LESS RELIABLE

Stories like Eifert Jones' and her family are fairly common to those who have had to operate without rural broadband internet. Internet in rural areas can be obtained by satellite, antenna or cell phone hot spot, but dependability and cost of these options are major issues.

Because of their home internet issues, Eifert Jones' college-aged son had to stay in the dorms of his suddenly shut college this spring so he could continue to study. The family had to get a hardship waiver from the school to allow him to stay on campus through the end of the semester, she said.

Her daughter had to learn from home with their weak internet service, sometimes visiting her grandma's basement to do schoolwork while maintaining distance between her and her grandmother. She faced lost and late assignments because of the internet, Eifert Jones said.

"She had issues right away with sending in assignments on Google Classroom and Docs," she said. "We learned with weaker internet signals her work didn't always go where it was supposed to."

SEEKING A STRONGER SIGNAL

Neligh, Nebraska, farmer Kenny Reinke faced similar issues with rural internet as his children had to continue their school year from home in mid-March.

While his oldest is only in fifth grade and had most of his schoolwork on paper, they did have issues with rural internet at their house when the work required the internet. Reinke's house sits in a valley roughly two miles wide about eight miles north of Neligh. Because of this, their satellite internet service has some issues working from their house.

"We are just low enough our signal isn't very strong," Reinke said.

Zoom meetings with his son's fifth grade classmates usually required a ride to the nearest hill on their northeastern Nebraska farm and doing the meeting from the cab of Reinke's pickup. The newer pickup also has its own Wi-Fi signal, so any online schoolwork usually meant a ride in the pickup, he added.

MORE RURAL BROADBAND?

While some rural Americans don't have access to broadband, other rural folks do. Access has grown, according to the Pew Research Center, but still lags behind urban and suburban areas (https://www.pewresearch.org/…).

According to a Pew Research Center survey conducted in early 2019, 63% said they have a broadband internet connection in their home, up from 35% in 2007. However, people who live in rural areas are 12 percentage points less likely to have broadband than their urban counterparts; in 2007 there was a 16-percentage-point gap between rural (35%) and all U.S. adults (51%).

Farmer Michelle Jones, of Broadview, Montana, said her local phone company provided her broadband internet two years ago. Before this, the only way her family could get decent internet from home was a hot spot device.

"It worked good sometimes, but other times it certainly did not," said Jones, who is a past president of the Montana Grain Growers Association.

Rural broadband also comes with a higher cost for many in rural areas. Jones said she pays $140/month for 50 megabits per second (Mbps) of download speed, while those in town receive 200 mbps and pay roughly $50/month.

Still, she is grateful to her local phone company for deciding to invest in rural broadband in her region of south-central Montana.

Jones said federal grants are really the only way small rural phone companies can run the fiber cables in rural areas for broadband and expect a return on their investment. Without federal support, these companies are not likely to invest in these improvements.

Jones is part of an FCC Advisory Committee, specifically a subcommittee titled Adoption and Jobs Working Group; the subcommittee's work includes seeing why farmers don't adopt precision agriculture technologies.

"I was just appointed, but among the things we will be looking at is the lack of high-speed internet in rural areas," she said.

FEELING FORTUNATE

Dillan Kuehny is a farmer from Caldwell, Kansas. The farm his parents live on is south of Caldwell, just across the state line in Grant County, Oklahoma. Broadband internet came to their region about five years ago, he said.

They rarely have any issues with their internet connection. You buy as much speed as you want, so families with multiple devices can do so without service interruptions, he said.

"I feel very fortunate that KanOkla (local phone company) took the initiative to do their fiber project because I realize many other rural people do not have this luxury," Kuehny said.

Kuehny said they mainly use the internet on their farm for email, but they also sell hay and breeding bulls online, so they use it to upload pictures and videos. They also use the internet to upload field maps and many other uses, he said.

RURAL LEARNING CHANGES

Back in Nebraska, Reinke is a member of the Neligh-Oakdale Public School Board of Education. He said the Nebraska Department of Education understood what school districts were going through and they advised school districts to do as best as they could once school at home started to take place, he said.

Most of the school district's students had access to some form of the internet to be able to learn from home. The Wi-Fi signal at the school was adjusted to include the parking lot, so students with internet issues could use this option, he said.

"We had the local internet provider work with our district's families to make sure the kids could get their schoolwork done," he said.

While education did continue during the pandemic online, Reinke said he does wonder what effect all of this has had on the learning process for students.

Will all students in a grade, for instance, be at the same general level as their classmates come fall? That is something he doesn't really know the answer to, he said.

Eifert Jones said one silver lining to the COVID-19 pandemic may be the struggles of rural residents to work and learn from home may have opened the eyes of those in leadership positions of how bad rural internet can be. Perhaps more investment in rural internet will be made now, knowing how many people could be working or educating their children from home in the future, she said.

Broadband internet could even be a selling point for those considering moving into rural areas, she said.

Eifert Jones told the story of her sister considering moving back to their home area of north-central Oklahoma. Her sister's husband had a job that he could work from home, but they required access to high-speed internet.

They considered buying a quarter section of land for sale near the family's farm operation and building a house. Ultimately, they had to live in a town closer to Oklahoma City because of the lack of broadband internet.

"Our rural area missed out having them relocate here all because of weak internet service," Eifert Jones said. "Yes, farmers need high speed internet to run their operations, but you also need it to attract people to your area."

**

Editor's Note:

DTN Staff Reporter Russ Quinn shares some of his own family's experiences with internet in a rural area in this week's Editors' Notebook blog. See it at https://www.dtnpf.com/…

Russ Quinn can be reached at russ.quinn@dtn.com

Follow him on Twitter @RussQuinnDTN

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