DTN Ag Headlines

The Surface Transportation Board (STB/Board) announced on Aug. 3, the adoption of a final rule to establish a streamlined approach for pleading market dominance in rate reasonableness proceedings. The final rule provides an option for simplifying the market dominance inquiry, which otherwise can be costly and time-consuming, especially in smaller cases. "Today's decision is part of the Board's continuing effort to make its rate review procedures more accessible, efficient and transparent," said the STB. The rail rate case issue has actually been under discussion since late 2013.

In September 2019, the Board issued a notice of proposed rulemaking (NPRM), which laid out a set of factors that could establish a prima facie showing of market dominance.(The dictionary defines prima facie as something that has been proven or assumed to be true, unless there is evidence presented.) The Board received numerous comments on the NPRM, and after careful consideration, the Board adopted the rule proposed in the NPRM with certain modifications. The final rule sets forth the following seven factors that a complainant must demonstrate:

-- The movement has a revenue-to-variable cost ratio of 180% or greater;

-- The movement would exceed 500 highway miles between origin and destination;

-- There is no intramodal competition from other railroads;

-- There is no barge competition;

-- There is no pipeline competition;

-- The complainant has used trucks for 10% or less of its volume (by tonnage) subject to the rate at issue over a five-year period;

-- The complainant has no practical build-out alternative (regardless of transportation mode) due to physical, regulatory, financial or other issues (or combination of issues).

The final rule will be effective on Sept. 5 (30 days from publication). Here is a link to more details of the final ruling: https://www.federalregister.gov/…

RCC ASKS CONGRESS TO FILL VACANT BOARD POSITIONS

The Rail Customer Coalition (RCC) is asking Congress to support the confirmation of two additional people to the STB so that the board can reach its full member complement. STB currently has three members and Congress allows the board to have five members.

In a July 3 letter to the Committee on Commerce, Science and Transportation, the RCC said, "As you know the Board plays a vital role in resolving freight rail issues and ensuring that goods can efficiently and affordably be shipped by rail. Unfortunately, the STB has been operating for several years with only three of the five Board members filled by Congress. We urge you and your colleagues in the Senate to confirm nominees Michelle A. Schultz and Robert Primus as quickly as possible."

Small and large businesses alike need a fair and transparent system that facilitates, rather than hinders, their ability to efficiently move goods to market, noted the RCC in the letter. The Staggers Rail Act, which celebrates its 40th anniversary this year, helped save the rail industry, and initially led to lower rates and a more efficient rail system. "But the Act's benefits are no longer so widely shared as a lack of competition among railroads -- due to widespread industry consolidation -- has led to steep premiums for the same or lower quality of service and the imposition of operational changes without concern for their negative impact on shippers," said the RCC.

The RCC added that, "The confirmation of Ms. Schultz and Mr. Primus will allow the Board to live up to its obligations under the Staggers Act and continue to pursue sensible reforms that will benefit everyone. Such reforms will increase access to competitive freight rail service and market-based rates, while cutting red tape and allowing the Board to operate more effectively."

The current STB board consists of Chairman Ann D. Begeman, Member Patrick J. Fuchs and Vice Chairman Martin J. Oberman. The Senate Commerce Committee received the nomination of Robert Primus on July 21, while the nomination of Michelle A. Schultz has been pending since July 2019.

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow her on Twitter @MaryCKenn

OMAHA (DTN) -- Grain bins were among the structures damaged by a widespread thunderstorm that slammed the Midwest on Monday, picking up speed and destructive power as it moved from Nebraska into Iowa, Illinois and Wisconsin.

The storm hit wind speeds in Nebraska as high as 70 miles per hour Monday morning. Then, the storm, classified as a "derecho" by meteorologists, continued to pick up speed as it swept across much of Iowa, hitting 99 mph, and then reaching speeds of more than 100 mph once it reached a large swath of Illinois and Wisconsin by midafternoon.

Damage assessments will become more detailed as the week progresses, but by Monday afternoon, Twitter was filled with photos and videos of smashed bins and scattered debris from the storm. Many bins on farms and at local elevators were empty -- or close to it -- as they were gearing up for an expected large corn crop at harvest.

In central Iowa alone, multiple grain bins were knocked out at elevators and cooperatives in a stretch of towns over about 50 miles, including Minburn, Luther, Slater and Collins, Iowa.

Ben Riensche, a farmer in eastern Iowa, shared a photo of crumpled bins on his farm near Marion, Iowa.

With USDA this week expected to forecast a large U.S. corn crop this fall, it's unlikely the market will acknowledge much crop loss from the storm, though there were also social media images of flattened corn and soybean fields.

"We had the makings of a problem before this storm," said DTN Lead Analyst Todd Hultman. "We've got a huge harvest on the way, and how much can the elevators handle?"

Depending on their capacity to make repairs quickly, farmers and elevators could be looking at piles and bags to store their crops. On social media, farmers noted the grain bin damage will affect fall basis levels in areas where elevators and farm bins were hit hardest.

"It will make it more difficult at harvest when they have to figure out what to do with all of their grain," Hultman said. "It will intensify pressure to sell at harvest time."

The system began as a thunderstorm on the edge of a cold front as it was moving south, but the front structure flattened out into a hot air mass in the Mississippi River Valley. "A cannonball of thunderstorms just began rolling eastward and built on itself with momentum and winds," said DTN Senior Meteorologist Bryce Anderson. "You had all of the cold-front energy coming on into the teeth of that hot air mass over the Mississippi Valley that helped to fuel it."

By midafternoon, the storm had been labeled as a derecho, classified for its strong, straight winds. At one point, more than 50,000 in Nebraska lost power, a total that reached more than 480,000 in Iowa by late afternoon with Illinois also reporting more than 200,000 without power. (https://poweroutage.us/…)

Mike Naig, Iowa's secretary of agriculture, pointed out the damages, as well. "Many farmers and agribusinesses experienced damage to crops, grain bins and buildings as severe storms tracked across the state this morning. My thoughts are with everyone who was affected as they begin clean up," Naig said.

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

Follow him on Twitter @ChrisClaytonDTN

By Katie Dehlinger

Farm Business Editor

and

By Emily Unglesbee

DTN Staff Reporter

MT. JULIET, Tenn. and ROCKVILLE, Md. (DTN) -- Beneficial planting conditions, favorable temperatures and timely doses of rain could help corn and soybean growers in Nebraska and South Dakota achieve record yields in 2020, according to the first day's findings on the DTN/Progressive Farmer 2020 Digital Yield Tour.

Powered by Gro Intelligence, the tour is an in-depth look at how this year's corn and soybean crop is progressing using Gro's real-time yield maps, which are generated with satellite imagery, rainfall data, temperature maps and other public data.

On Monday, Gro's models for corn show a statewide average of 198.7 bushels per acre (bpa) in Nebraska and 174.4 bpa in South Dakota. USDA will release its first state-by-state yield estimates in Wednesday's Crop Production report.

Gro forecasts soybean yields at 63.2 bpa in Nebraska and 49.2 bpa in South Dakota.

See specific comparisons in these charts:

Nebraska: https://app.gro-intelligence.com/…

South Dakota: https://app.gro-intelligence.com/…

Gro's yield estimates on a county and state level update daily, so the numbers at publication time may be slightly different than that found on the Gro website.

If Gro's estimates come to fruition, corn yields would set records in both states. Nebraska would set a new soybean record, and South Dakota would come very close to its record, 49.5 bpa, which was set in 2016.

"There is no doubt that South Dakota and Nebraska are getting some positive payback after the extremely wet year in 2019 in the form of ample soil moisture," DTN Senior Ag Meteorologist Bryce Anderson said. "The past six months have trended somewhat drier in the eastern parts of these two states, but that reduced precipitation allowed for excess water to either run off or evaporate. In turn, this made more acreage available for planting, particularly in South Dakota."

The good weather kept on coming with timely rains and favorable temperatures through the summer.

"In fact, much of these two states took rainfall during July of 50% above normal to almost twice the normal amounts. And to go along with the rain, temperatures were mostly normal to maybe a degree or two above normal in most crop areas. This was very favorable for corn pollination and soybean flowering," Anderson said.

The forecast continues to look favorable, with periods of hotter weather from the southwestern U.S. colliding with cooler, northern air "that allows for thunderstorm activity and the introduction of a thermostat effect. That looks like a beneficial formula during the filling phases as we finish out the season."

DTN Lead Analyst Todd Hultman said Monday's estimates are early indications that the U.S. could be on track for record corn and soybean production in 2020, "a prospect that is also brought out by USDA's high crop ratings and has been pressuring prices lower of late. Coming in a year when coronavirus concerns and the trade dispute with China continue to hang over prices, the anticipation of record harvests is keeping potential buyers out of the markets and not offering much help for higher prices."

NEBRASKA

Gro's estimated statewide average corn yield of 198.65 bpa this year soars above Gro's 2019 statewide estimate of 191 bpa and USDA's final 2019 estimate of 182 bpa. Average county corn yields in Gro's models mostly range from the 180s bpa up into the low-200s bpa.

The Cornhusker State owes these favorable estimates largely to Mother Nature's cooperation, said DTN's Anderson.

Gro's NDVI map, a measure of a region's relative lushness or dryness, tells the tale of a well-watered state. Most of Nebraska shows white coloring, which indicates normal vegetation, or green coloring, which marks above-average vegetative growth. See the NDVI map here: https://app.gro-intelligence.com/….

Nebraska's crop production is always aided by irrigation from the sprawling Ogallala Aquifer, which stretches beneath the state, with its deepest portions underlying the center third. This year, ample rainfall has been an additional boon to the state's dryland counties, Anderson noted.

"It's been a favorable season in large part for dryland crops across the state -- including both the typical rain-fed areas of eastern Nebraska," he noted. "But also, even in irrigation-focused areas, it simply adds to production on pivot corners."

Some of the highest corn yields are expected from south-central Nebraska, where Gro's maps peg Phelps County as the state's highest estimated corn yield, at 221.8 bpa, up from 214 bpa last year. Yields drop in the more arid western third of the state, where the southwestern county of Banner nets the lowest estimated yield of 107.1 bpa.

Where northeastern Nebraska farmer Kenny Reinke farms in Antelope County, he expects an average production year, with good pollination conditions being slightly offset by cloudy late-summer weather that forced some corn ear tipback. Gro's model agrees. It predicts an average corn yield of 205.2 bpa in Antelope County -- the exact same as USDA's five-year average for that county.

Compared to last year's spring and early summer deluges and flooding, Nebraska farmers had much more typical spring and summer conditions, which led to rapid planting and even emergence, Anderson said. "Nebraska soybean planting on May 31, 2020, was 95% compared with 62% on May 31 last year, and emergence was 73% on May 31 this year compared with 34% at the end of May 2019," Anderson noted. "The beneficial start has been followed by generally favorable temperatures and timely doses of rain through the summer."

"It was just so much more of a normal growing season than last year," added Reinke. "For example, last year, we were just started getting soybeans in the first of June; this year, it was the middle of May for our latest planting. That makes a huge difference on soybeans."

For soybeans, Gro's model pegs the statewide average yield at 63.2 bpa, well above Gro's 2019 estimate of 57.3 bpa and USDA's final 2019 estimate of 58.5 bpa.

In Gro's maps, the southern central region of the state, stretching from the Colorado border to just east of Lincoln, holds some of the best beans, with county yields in the mid to high-60s. Phelps County wins the high-yield estimate once again, with Gro models coming in at 69.7 bpa there. Elsewhere in north-central and the eastern third of the state, soybean yields range from the mid-50s into the low-60s, with one lone western county, Cheyenne, dropping to 48.5 bpa.

In Reinke's Antelope County, Gro pegs soybeans close to 62.2 bpa, close to USDA's five-year average of 61 bpa; Reinke agrees his fields could fall near 60 bpa.

See the county-level yield maps for corn and soybeans in Nebraska here: https://app.gro-intelligence.com/….

SOUTH DAKOTA

Gro Intelligence's 174-bpa corn yield forecast is significantly higher than last year. In 2019, Gro estimated the state's final yield at 153 bpa, while USDA pegged the final tally at 144 bpa. At the county level, Gro's maps show the strongest yields in the state's eastern counties, with averages ranging from 180 bpa in the state's northeast to 207 bpa in Minnehaha County, which Gro forecasts will have the highest yields.

"Corn looks absolutely phenomenal, and I think you can say that about the entire state of South Dakota," said Tregg Cronin, who farms in Potter and Sully counties in central South Dakota. Near his farm, which is in the central part of the state, Gro estimates yields ranging from 120 bpa to 170 bpa. Even some counties in the western part of the state, where very little corn is grown, have yield forecasts of 130 to 150 bpa.

There is some prevented planting along the border with North Dakota, which shows up on Gro's NDVI maps as the dark-brown patches. Gro estimates the state has close to 250,000 acres of prevented planting with most of it in Brown County. North Dakota, which saw corn harvest extend into this spring, had much more prevented planting acreage this year, with Gro estimating unplanted corn and soybean acreage at just above 900,000 acres.

Otherwise, the NDVI map for South Dakota shows well-watered crop conditions in the Missouri River Basin and closer-to-average greenness ratings in the state's east. View the South Dakota NDVI map here: https://app.gro-intelligence.com/….

"You have a hard time, anywhere in the state, finding a place that hasn't seen timely moisture," Cronin said. "We've had some hot temps, but nothing out of the ordinary for a South Dakota summer. It just seems like it's very difficult to find anybody who's not very, very optimistic on their crop."

Gro estimated corn in Sully County will average 161.8 bpa, which Cronin said would be a large percentage above average. "That'd be a big number for them, but, again, I can't dispute it. If that county pulled it off, that'd be pretty reflective of most of the central third of the state, I'd say. If Sully County ends up that far above, I think there are a lot of counties that are going to do the same."

Gro didn't publish a corn yield estimate for Potter County, where most of Cronin's operation is located.

On soybeans, Gro estimates a statewide average of 49.2 bpa, above last year's estimates from both Gro and USDA. Gro's final estimate of South Dakota soybeans in 2019 was 41.9 bpa, while USDA's was 42.5 bpa. Like corn, the strongest yields are in the state's southern and eastern counties, where yields range from 52 bpa in Davison County to 60 bpa in Moody County. Yield estimates are lowest in South Dakota's northern tier of counties, with average yields falling in the 36-to-38-bpa range.

Gro pegs Potter and Sully counties at 39.1 bpa and 45.6 bpa, respectively. Cronin found that surprising, especially because Sully County didn't have a T-yield for soybeans for crop insurance until just a few years ago. There is more irrigation in Sully County, he said, but if he were to compare dryland beans in both counties, he thinks Potter County can raise a better bean crop.

"Whether it's sunflowers, soybeans or corn, there isn't a bad-looking field unless you screwed it up yourself," Cronin said.

Find county-level yield maps for South Dakota here: https://app.gro-intelligence.com/….

ABOUT THE TOUR

Now in its third year, the DTN/Progressive Farmer 2020 Digital Yield Tour, powered by Gro Intelligence, takes place Aug. 10-14 and provides an in-depth look at how the year's corn and soybean crops are progressing. Each day, we'll feature crop condition and yield information from various states, which include links to the Gro yield prediction maps for those states. Yield summaries are viewable at the county level.

The "tour" starts in the west, with the first day's articles focusing on Nebraska and South Dakota. On Tuesday, Aug. 11, the tour will check on crop conditions in Missouri and Kansas. On Aug. 12, the tour will explore yield estimates from Minnesota, Wisconsin and Iowa. On Aug. 13, we will move into the Eastern Corn Belt -- Illinois, Indiana and Ohio -- before publishing a final look at Gro's overall national yield predictions for the 2020 corn and soybean crops on Aug. 14. Readers should note that the Gro yield visuals are continually updated, while the DTN feature articles are based on the company's yield estimate at the time the article was written. Numbers quoted in the articles may be different than those on the Gro website depending on when viewed.

To see all the tour articles and related DTN stories about the 2020 crop, visit our tour site at: https://spotlights.dtnpf.com/….

About Gro Intelligence: The New York-based company is focused on creating data analytics for the agriculture industry. Gro builds proprietary crop models that use satellite imagery, soil conditions, weather and other crop and environmental data to produce crop health and yield prediction numbers and visuals.

To learn more about Gro, go here: https://www.gro-intelligence.com/….

To read the research white paper on their modeling system, go here and select to "Download the corn yield model paper": https://gro-intelligence.com/….

Katie Dehlinger can be reached at Katie.dehlinger@dtn.com

Follow her on Twitter @KatieD_DTN

Emily Unglesbee can be reached at Emily.unglesbee@dtn.com

Follow her on Twitter @Emily_Unglesbee.

LINCOLN, Neb. (DTN) -- Rogelio Munoz Calderon worked for Tyson Foods in Dakota City, Nebraska, for 27 years and raised a family as a packing-plant worker in the northeast Nebraska town.

Munoz Calderon finally became a U.S. citizen last March, his son Christian said. "He was so happy and so proud."

He died in May from COVID-19 at age 52, less than a week before Christian's son was born. Christian, a former Tyson worker as well, brought a portrait of his father to the Nebraska Capitol on Thursday as the Nebraska Legislature became the first state in the country to hold a hearing on the toll taken on meatpacking plant workers during the epidemic.

"I'm here today to honor my father because the company never did, but they told us all we were doing something essential for the country," Christian Munoz said.

The three-hour-plus legislative hearing was full of emotional details from workers, families, union representatives and advocates calling for the state to implement better worker protections. Nebraska's only Latino state senator, Tony Vargas, has been pushing during the summer session for a hearing on his bill. Time is short in the Nebraska unicameral session, and Vargas is now trying to get provisions on worker protections attached to another piece of legislation as the pandemic-shortened legislative session is winding down.

Packing plants are a critical part of the Nebraska economy in a state that has three times as many cattle as people. The state has multiple processing plants for cattle, pork and poultry, making it one of the most influential industries in the state.

Testifying Thursday, Vargas pointed out packing plant workers so far have made up roughly 5,000 out of 27,800 coronavirus cases in the state, and at least 21 workers have died. Those statistics don't include family members who contracted the virus from workers as well. Even higher, Vargas said Latinos make up 60% of total cases in the state and roughly 25% of the 347 reported deaths.

"If you look at Nebraska COVID-19 data, every county with a meatpacking plant in it is at the top of the list," Vargas said.

Vargas urged his fellow lawmakers to consider the pandemic is hitting minorities harder, including refugees new to the country. "We can't hide behind the fact that this is affecting people who can't speak out."

Vargas's bill would require social distancing at packing plants with barriers and other requirements to keep workers apart. The bill would not only require employers to provide masks but face shields as well.

The coronavirus has exacted a heavy toll on meatpacking workers. To keep the food supply operating and stop the back up of livestock needing slaughter, President Donald Trump signed an executive order in late April requiring companies to remain operating. The federal government also issued guidelines to companies on personal protective equipment and social distancing.

Nationally, according to data collected by the Food and Environment Reporting Network, at least 39,829 meatpacking plant workers have contracted the virus, and 184 have died. The Occupational Safety and Health Administration in July issued a bulletin requiring employers to report hospitalizations from COVID-19, but OSHA pulled that requirement from its website within days of issuing it without explanation.

Slaughter totals for beef have basically recovered from the crash in April and May as USDA shows both beef and swine processing at roughly the same capacity as a year ago. Industry estimates project there may still be a backlog of a million cattle and 3 million hogs that are behind schedule in going to the packing plants. The plant shutdowns and slow processing since this spring also have cost livestock producers billions of dollars in lower prices. At least some have been forced to euthanize animals.

Advocates for refugees testified they are scared to go to work, but afraid to speak out because of their refugee status. Andrea Skolkin, chief executive officer for One World Community Health Centers, an operator of health clinics in low-income areas, told lawmakers the clinics are overwhelmed.

"There have been so many ambulances coming into the health centers because the conditions of people coming to us is so severe," Skolkin said, describing one situation where man who was an expectant father came into the clinic, but died on the way to the hospital.

Skolkin said higher safety standards are needed for people classified as essential workers.

Multiple workers, and former workers, at JBS in Grand Island, Nebraska, testified about the struggles with masks. They are given one mask at the beginning of a shift that becomes soaked with water, blood and sweat within a few hours. William Matamoros said he was fired at JBS for complaining about the problems with masks.

"It's really hard to work eight straight hours when your mask is wet and soiled," Matamoros said through an interpreter.

Eric Reeder, president of the United Food & Commercial Workers (UFCW) Local 293 in Nebraska, testified that conditions have worsened only because there are fewer workers and those who report to work are being asked to do the jobs of two to three people. That's led to more work-related injuries, he said. Also, there may be social distancing on the plant floor, but that doesn't apply in locker rooms or stairwells in places that have old ventilation systems as well.

"If you are sick in the locker room, it just hangs in the air," Reeder said. "The employers, as long as they are not mandated, they aren't going to do it."

In an interview, Reeder said some plants are paying full pay for workers on sick leave while others pay nothing. Some plants are good about social distancing while others are not. "Everybody is doing something right, and everybody is doing something wrong."

Graciela Billington, a union steward at the JBS plant in Grand Island, told lawmakers that one of the more demoralizing events last month was when OSHA inspectors toured the JBS plant, but only walked through parts of the plant that management wanted to show. "A lot of people were looking for OSHA to do something on that day, but they only went to the parts of the plant that were really clean," Billington said.

No one at the hearing testified against Vargas's legislation. Throughout the pandemic, packing plant companies have written Gov. Pete Ricketts, encouraging him not to take any actions that would affect processors. Smithfield Foods and Tyson Foods have each published advertisements in newspapers defending their workplace practices and calling out critics.

Like Christian Munoz, others who testified Thursday were the sons and daughters of workers who became infected and were hospitalized. Eliana Ramirez, who works as a respiratory therapist in Omaha, said her dad, mom, sisters, aunt and cousins were all infected with the virus. Her dad, who also worked for Tyson Foods in Dakota City, was hospitalized and put on a ventilator, but he has recovered and is working again. "That was the worst nightmare for me when I found out my dad was being put on a ventilator because I see that every day," Ramirez said.

Ramirez criticized the slow response from both companies and the federal government to implement safety measures when packing plants began to get hit hard in April. "The government has just kind of winged it and hoped for the best," she said.

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

Follow him on Twitter @ChrisClaytonDTN

As we navigate the first week of August, it is no surprise that 2020 has been cruel to commodity prices in general and to grains, in particular. Coming at a time when surpluses were already common for a broad array of crops, COVID-19 pulled the rug of demand out from under markets and was followed with another hit of recent selling, encouraged by favorable crop weather.

Year-to-date percentage changes in commodity prices show just how pervasive the damage has been as 14 of a list of 18 commodity prices still show negative returns for the year, as of Aug. 6. As far as the coronavirus is concerned, most of the price damage was done by late April and several commodities have had decent rebounds since.

There is an old adage that says it's not the news that's important, but how prices respond to the news. The saying has room for debate, but it is also true that the commodities that rebound from a bearish hit the quickest are often the leaders in the next market phase.

In the past three months, spot crude oil and spot gold prices are two non-ag commodities that have done extremely well. Crude oil is up 64%, thanks to production cuts by a large group of OPEC and non-OPEC oil producers. Gold is up 23%, trading at all-time highs while COVID-19 concerns keep the Federal Reserve committed to an accommodative monetary policy.

The five ag commodities that have fared the best and outperformed the S&P 500 are palm oil, soybean oil, class III milk, live cattle and cotton.

Palm oil prices were up 39% the past three months and have benefited from increased demand for vegetable oil generally. In Malaysia, measures intended to limit the spread of the coronavirus have kept out foreign workers with the result that palm oil production is expected to be down this year. The situation has also helped soybean oil prices gain 20% and canola 5% over the same time period.

Spot prices of class III milk are up 24% the past three months, perhaps one of the biggest bullish surprises of 2020. In late April, spot prices fell below $11 per hundredweight, their lowest level in 10 years as restaurants and schools closed. News of perishable milk supplies with nowhere to go were dumped on the ground and created bad press for the milk market. That all changed May 4 after USDA Secretary Sonny Perdue announced $470 million of Section 32 food purchases, including $120 million for dairy (https://www.ams.usda.gov/…). Milk suddenly found an eager market of buyers again and spot prices ran up quickly, peaking at $23.78 in mid-July, the highest in over five years.

Milk prices have backed down since and closed Thursday, August 6, at $16.91. In this case, the best of the bull rally is likely over as the response to the one-time stimulus announcement fades.

Spot prices of live cattle are up 24% the past three months, something that looked highly unlikely in April when COVID-19 concerns were closing down meat plants and leaving ranchers without markets for their expensive, growing livestock. Fortunately, drastic efforts were made to keep plants open and slaughter levels have returned to near-normal levels. The market still needs more time before raising cattle becomes profitable again, but the 24% rebound in the futures market helps.

As a side note, feeder cattle were close to being on this list with a 14% gain the past three months but were 3 percentage points shy of the S&P 500's 17% return.

The fifth ag commodity, cotton, is up 19% since early May, edging out the S&P 500 by 2 percentage points over the same period and attracting positive attention from noncommercials. Cotton prices had been depressed by plentiful U.S. supplies and the trade dispute with China but have gotten more support lately from this year's lower crop ratings and drought in Texas.

I can't guarantee these five ag commodities will continue to perform this well the rest of 2020, but as mentioned above, these impressive displays of technical resilience can be important indicators of the fundamental strength of the commodity markets they represent and are candidates for attracting noncommercial attention.

With the way things started, 2020 may turn out to be one of the most bearish years in U.S. ag history. The track record of the past three months, however, shows that even this year can have some bullish possibilities.

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

Follow him on Twitter @ToddHultman

INDIANOLA, Iowa (DTN) -- Alan Hojer, a succession planning consultant, was busy before the pandemic, but calls from farmers and ranchers looking to begin or update their plan have accelerated since COVID-19 began circling the globe.

"The main obstacle is not that they don't want to have a transition plan for their farm, it's that they don't know where to begin," said Hojer, whose "Keep Farmers Farming" program is sponsored by First Dakota National Bank in Yankton, South Dakota.

Jim Rein, CPA and partner with KCoe Isom LLP, said now is the perfect time to put together an estate plan or update your current plan. "We have the lowest interest rates and tax rates we'll likely see in our lifetime, and the most advantageous tax laws we've ever had," he said.

The uncertainty of the pandemic has opened up sensitive conversations about what happens if someone gets really sick or dies that, in the past, people were reluctant to talk about.

"A lot of advice we're currently giving is the same as before," Rein said, "but people's mindset is different."

HOW TO START TRANSITION PLANNING

Hojer encourages farmers to reflect on how the farm transitioned to them. "What did they like or not like? And then, adjust that to their business today, which likely involves more people and a bigger, more complicated operation," he said.

Before going to an estate planning attorney, he suggests doing a little homework to make the best use of their time with a planning professional. Consider what your operation looks like today.

"I spend a lot of time helping people figure out where they are now," Hojer said. "If you can see your next 12-18 months and it will be OK, then you can think about transition. There are opportunities out there. Planning gives you hope."

Your estate planning expert will ask a lot of questions: Do you have a successor? How do you want to treat off-farm heirs? How do you want to shift management control and asset ownership -- quickly, slowly, after certain goals have been achieved? The estate expert will want to know your business structure, your management team and possible future managers. The more time you spend making these decisions about what you want for your farm's future, the less time you need to spend "on the clock" with the attorney.

There is a difference between estate planning, which decides what will happen to your assets when you die, and succession planning, which is how to transition the farm or ranch operation to the next generation, explained Rein, who leads KCoe Isom's NextGen division.

"Sometimes you have no heir apparent," said Nate Franzen, president of the ag banking division at First Dakota National Bank. "You still want to be proactive in the planning process. Maybe you want to position assets to have your land farmed by a longtime family friend, or you want a sale with the least tax consequence. Having the right plan is key."

When the attorney understands your operation and knows your goals, they can offer strategies, such as entity structures, trusts, gifting plans, buy/sell agreements, etc., to best reach your goals.

SET DEADLINES AND STICK TO THEM

Once the farm work gets busy again, it's easier to procrastinate on big-picture planning, Franzen said. "Succession planning gets moved down the priority list."

The next step is to communicate with your spouse and children about what your ideas are, what your options may be and what their ideas and goals are. But without a deadline, it often doesn't happen.

"And sometimes you need a facilitator to get the discussion going," Rein said. "Then you can start to broaden the scope in terms of that discussion."

A deadline gets the ball rolling. For example, Rein may assign a farmer the task of having the conversation and sharing his notes by the end of October. Then, they'll set another deadline for the end of the year.

"It's a process. Some people look at estate planning as an event. But, in fact, it's more of a process,"

Rein said. "Even for folks who have already completed their estate plan, it's time to blow the dust off those documents and see if they are still in line with what you are doing as a family and as a business."

Rein said those who are successful in passing the farm to the next generation make planning their transition a priority.

"It's just as important as crop rotation and chemical inputs. There are plenty of horror stories of family breakups out there," Rein said, recalling a recent visit with a farmer. While driving down the road, the farmer pointed to a run-down farm, and explained that it used to be a local showplace. All of the area's farmers wanted to be like those guys.

But "no one in the next generation was ready to take on the operation or wanted to," Rein said. Now, there are weeds in the fence row and equipment sitting outside. It was a sad sight, Rein said, and one that might have been avoided if the family had planned ahead.

WASHINGTON (DTN) -- JBS, the Brazilian meat company, is planning to convert a Colorado lamb processing facility to process beef cuts, further limiting processing facilities for the sheep industry in western states, according to local media reported.

JBS USA Holdings Inc. was expected to close on its purchase of the Mountain States Rosen lamb processing facility in Greeley, Colorado, last Friday but senators and House members from five western states have asked the Justice Department to intervene in the purchase.

"It is our understanding that JBS intends to permanently destroy all of the lamb processing equipment as soon as this week," the lawmakers led by Sen. Mike Lee, R-Utah, wrote Assistant Attorney General Makan Delrahim last Wednesday.

Mountain States Rosen (MSR) is a farmer cooperative that was owned by 150 ranch families, but the processing plant fell into bankruptcy and JBS bought the plant in bankruptcy court. The MSR plant also happens to be just across the road from the JBS beef processing facility in Greeley. And JBS actually owned and operated the lamb plant before selling it to the cooperative in 2015. The Fence Post reported JBS plans to use the processing plant to grind hamburgers and cut steaks for its beef plant, a plan that will leave western lamb producers with no place to process.

"This is alarming for several reasons," the lawmakers continued in their letter. "In addition to eliminating hundreds of jobs, MSR's Greeley facility is one of the largest lamb processing facilities in the region, and serves sheep ranchers from 15 states, including Utah, Montana, South Dakota, Wyoming, and California."

MSR processed about 360,000 lambs last year and is considered the largest single processing facility in western states.

"This facility competes head-to-head with JBS, which imports all of its lamb products," the senators and congressmen wrote to DOJ. "Through this acquisition, JBS will eliminate a major domestic competitor in the region and could replace significant quantities of the American-raised lamb with imported products. Industry experts tell us that the lamb processing market does not have the capacity to absorb the lambs currently going to MSR. Approximately 15% to 20% of the U.S. supply may not find a processor when they are ready for market.

"We are told that many of these family-operated sheep ranches in the Western states may go out of business after this deal, costing the lamb industry potentially hundreds of millions of dollars per year."

The lawmakers urged the Department of Justice to open an investigation and "take appropriate steps to prevent irreversible actions that might harm the ability of American sheep ranchers to get their products to market until the department can determine how best to protect competition in this significant part of America's food supply."

A Utah rancher, Carson Jorgensen, wrote Vice President Mike Pence last week laying out the case that JBS's purchase of MSR violates antitrust laws. JBS is one of the country's largest importers of lamb into the United States. Jorgensen called on the Trump administration to invoke the Defense Production Act to avoid shutting down the processing of lambs in western states. "I cannot express enough the urgency and the dire conditions my family and our fellow ranch families will find themselves in, in a matter of weeks and months," Jorgensen said. "We will be forced out of business and our herds will not be replaced. The lamb market in the U.S. will rely almost exclusively on more and more foreign products, foreign imports and foreign supply chains."

In an interview on the Red River Farm Network website last week, South Dakota Stockgrowers Association Executive Director James Halverson said, "I don't know that hardly anybody knew about this before the last couple of days. This raises a lot of red flags, so I think our industry is justified in raising a lot of questions."

Halverson added that there is still time for sheep producers' voices to be heard and urged them to call their senators and representatives in Washington.

Besides Lee, signers of the letter included Republican Sens. John Barrasso of Wyoming, Steve Daines of Montana, Mitt Romney of Utah, and Michael Rounds and John Thune of South Dakota.

House members who signed the letter included Republicans Rob Bishop of Utah, Liz Cheney of Wyoming, Greg Gianforte of Montana, Dusty Johnson of South Dakota, Devin Nunes of California and Chris Stewart of Utah.

A copy of the letter was sent to Agriculture Deputy Secretary Steve Censky.

Carson Jorgensen, a Utah sheep rancher, also wrote Vice President Mike Pence about the situation, emphasizing that JBS is foreign-owned.

-The Fence Post -- JBS plans switch to beef at Mountain States Rosen lamb plant, leaving lamb producers high and dry: https://www.thefencepost.com/…

-Congressional letter to Assistant Attorney General Delrahim: https://www.lee.senate.gov/…

-Jorgensen letter to Vice President Pence:

https://www.carsonjorgensen.com

DTN Ag Policy Editor Chris Clayton contributed to this report.

Jerry Hagstrom can be reached at jhagstrom@nationaljournal.com

Follow him on Twitter @hagstromreport

INDIANOLA, Iowa (DTN) -- Alan Hojer, a succession planning consultant, was busy before the pandemic, but calls from farmers and ranchers looking to begin or update their plan have accelerated since COVID-19 began circling the globe.

"The main obstacle is not that they don't want to have a transition plan for their farm, it's that they don't know where to begin," said Hojer, whose "Keep Farmers Farming" program is sponsored by First Dakota National Bank in Yankton, South Dakota.

Jim Rein, CPA and partner with KCoe Isom LLP, said now is the perfect time to put together an estate plan or update your current plan. "We have the lowest interest rates and tax rates we'll likely see in our lifetime, and the most advantageous tax laws we've ever had," he said.

The uncertainty of the pandemic has opened up sensitive conversations about what happens if someone gets really sick or dies that, in the past, people were reluctant to talk about.

"A lot of advice we're currently giving is the same as before," Rein said, "but people's mindset is different."

HOW TO START TRANSITION PLANNING

Hojer encourages farmers to reflect on how the farm transitioned to them. "What did they like or not like? And then, adjust that to their business today, which likely involves more people and a bigger, more complicated operation," he said.

Before going to an estate planning attorney, he suggests doing a little homework to make the best use of their time with a planning professional. Consider what your operation looks like today.

"I spend a lot of time helping people figure out where they are now," Hojer said. "If you can see your next 12-18 months and it will be OK, then you can think about transition. There are opportunities out there. Planning gives you hope."

Your estate planning expert will ask a lot of questions: Do you have a successor? How do you want to treat off-farm heirs? How do you want to shift management control and asset ownership -- quickly, slowly, after certain goals have been achieved? The estate expert will want to know your business structure, your management team and possible future managers. The more time you spend making these decisions about what you want for your farm's future, the less time you need to spend "on the clock" with the attorney.

There is a difference between estate planning, which decides what will happen to your assets when you die, and succession planning, which is how to transition the farm or ranch operation to the next generation, explained Rein, who leads KCoe Isom's NextGen division.

"Sometimes you have no heir apparent," said Nate Franzen, president of the ag banking division at First Dakota National Bank. "You still want to be proactive in the planning process. Maybe you want to position assets to have your land farmed by a longtime family friend, or you want a sale with the least tax consequence. Having the right plan is key."

When the attorney understands your operation and knows your goals, they can offer strategies, such as entity structures, trusts, gifting plans, buy/sell agreements, etc., to best reach your goals.

SET DEADLINES AND STICK TO THEM

Once the farm work gets busy again, it's easier to procrastinate on big-picture planning, Franzen said. "Succession planning gets moved down the priority list."

The next step is to communicate with your spouse and children about what your ideas are, what your options may be and what their ideas and goals are. But without a deadline, it often doesn't happen.

"And sometimes you need a facilitator to get the discussion going," Rein said. "Then you can start to broaden the scope in terms of that discussion."

A deadline gets the ball rolling. For example, Rein may assign a farmer the task of having the conversation and sharing his notes by the end of October. Then, they'll set another deadline for the end of the year.

"It's a process. Some people look at estate planning as an event. But, in fact, it's more of a process,"

Rein said. "Even for folks who have already completed their estate plan, it's time to blow the dust off those documents and see if they are still in line with what you are doing as a family and as a business."

Rein said those who are successful in passing the farm to the next generation make planning their transition a priority.

"It's just as important as crop rotation and chemical inputs. There are plenty of horror stories of family breakups out there," Rein said, recalling a recent visit with a farmer. While driving down the road, the farmer pointed to a run-down farm, and explained that it used to be a local showplace. All of the area's farmers wanted to be like those guys.

But "no one in the next generation was ready to take on the operation or wanted to," Rein said. Now, there are weeds in the fence row and equipment sitting outside. It was a sad sight, Rein said, and one that might have been avoided if the family had planned ahead.

OMAHA (DTN) -- The ethanol industry continues to wait for a decision from EPA on 86 pending small-refinery exemptions after the U.S. Department of Energy finished a review and sent those requests back to EPA.

During a news conference on Thursday, Renewable Fuels Association President and CEO Geoff Cooper said the small-refinery exemption program needs to be transparent.

A report from Hoosier Ag Today, citing unnamed sources, said the DOE had recommended EPA approve some of the pending 58 retroactive waiver requests to the Renewable Fuel Standard. The EPA still has a total of 86 pending requests for small-refinery exemptions, including a total of 28 for 2019 and 2020.

Cooper said the agency already has missed the 90-day deadline to issue decisions on the requests. The deadline was triggered when EPA received the requests.

"We haven't heard what the DOE recommends," he said. "It would be absolutely insane for DOE to recommend any of those hardship waivers. If there was no hardship in 2012, how can they claim that now? There's no transparency in this process."

When contacted by DTN, EPA spokesperson Molly Block said, "EPA has received initial feedback from the Department of Energy on certain petitions for small-refinery exemptions for past compliance years under the Renewable Fuel Standards Program. Our staff is reviewing."

Cooper said SREs have "eroded" the RFS from 15 billion gallons to 13.7 billion or 13.8 billion in each of the past several years.

"If the EPA continues to hand out these exemptions illegally, they're locking in the E10 blend wall," Cooper said. "It really removes the incentive to expand into higher blends. We've got an industry capable of producing 17 billion gallons or more. We should use that capacity."

The blend wall is when the total amount of ethanol production exceeds what is allowed in the gasoline blend market.

The U.S. Court of Appeals for the 10th Circuit in Denver ruled in January that the EPA mishandled the SRE program when it came to issuing three refining company waivers.

It was expected the agency would apply the ruling nationally after the court said the three companies involved had not previously received waivers and didn't qualify.

"It's the statute itself that established DOE's role in the process," Cooper said. "EPA has really set up a situation that allows for finger pointing between agencies."

INDUSTRY WAITS FOR AID

In addition, like other segments of the agriculture industry, ethanol producers continue to wait for financial help from Congress.

Republicans and Democrats continue to hammer out the final details of a COVID-19 relief package to include agriculture, with a Friday deadline in place to reach an agreement.

"It does feel like a long way to go in the next 48 hours," Cooper said.

"We remain hopeful and confident something will come together in the next 48 hours," Cooper said. "The good news is there is bipartisan support. We feel quite confident that, if something comes together, it will include something for biofuels.

"The bottom line is the industry is not in good shape. It is in worse shape than it was pre-COVID. We're dealing with the loss of key export markets. We've not exported a drop of ethanol to China. But it is broader than China. The industry was already in pretty tough shape."

During the peak of the COVID-19 economic shutdown, about half of the nation's ethanol production went offline.

"We need to see continued expansion in E15 and higher blends," Cooper said. "We're not done building demand in the U.S. by any stretch."

Randy Doyal, CEO of Al-Corn Clean Fuel in Minnesota, said the industry is struggling his state with two or three plants closed and others at reduced production.

"It's laughable to me DOE could say refiners suffered a hardship and they're putting us out of business," he said. "We're hanging in there and we're not going away. We're too much like farmers."

RFS ANNIVERSARY

The 15th anniversary of the RFS being signed into law is on Saturday.

On Thursday, the RFA released a report on what the program has meant to the industry.

When the first RFS was signed into law in 2005, there were 81 ethanol plants across the country. That has grown to more than 205. Ethanol production capacity has grown from about 4 billion gallons in 2005 to about 16 billion gallons in 2020.

The RFA said the value of ethanol and co-products has grown by more than $20 billion, while growing the number of jobs in ethanol from about 150,000 in 2005 to about 350,000 in 2020.

Corn production has increased nearly 25%, while planted acreage has grown by 10% since 2005. The RFA report said overall food inflation has fallen from 2.4% in 2005 to 1.9% in 2020.

Overall crop acres in use fell from 418 million acres in 2005 to 396 million acres in 2020. Corn production in the U.S. has increased by 23% since 2005.

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

Follow him on Twitter @toddneeleyDTN

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