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A Prism Business Media Publication June 14, 2006 | 060614   

TABLE OF CONTENTS
 >> Logan Hawkes

 >> E-85 available at Wal-Mart?

 >> Conference committee bows to president's wishes

 >> Growers unite to oppose lifting import tariff on ethanol

 >> Soy-based products are helping clean up this spring

 >> U.S., Vietnam clear WTO hurdle

 >> USDA cuts wheat production estimate

 >> Early, active hurricane season possible

 >> Unified front critical to maintain 2002 farm law

 >> News from the Top of the Hill

 >> Farm groups: Scale back Doha if talks falter

 >> USDA to enroll 1 million new acres in CRP

 >> Thiesse's Thoughts: CCP details

 >> The most important factor impacting agriculture

 >> Funding set for FY 2006 CSP contracts

 >> Johanns extends deadline for EQIP energy program

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  EDITOR'S NOTE
Logan Hawkes
06/14/06    Crop News Weekly
It didn't take long this year for tropical weather systems to start their annual march toward the U.S. coastline. Alberto assailed the Florida coastline this week dropping much needed rain across a dry Sunshine State. While the moisture is appreciated, farmers in the South aren't looking forward to the long hurricane season ahead.

Like the weather, news from the world of agriculture keeps happening. In the spotlight this week, soybean growers are hoping alternate uses for soy-based products will extend beyond the gas pump in the near future. Consumers may soon be seeing soybean products in cleaners, oils and building supplies. Also this week, U.S. and Vietnamese officials have signed a new bilateral trade agreement on the accession terms that will allow Vietnam to join the World Trade Organization after it opens more of its markets to foreign goods. In other news, USDA has lowered its estimate of production for the U.S. wheat crop by 59 million bushels from last month -- from 1.87 billion bushels to 1.81 billion bushels -- based on lower forecasted yield for winter wheat. Also in this issue, it didn't take long for the tropical season to make its entry up the Gulf coastline. Abnormally warm water temperatures in the Gulf of Mexico and Caribbean Sea are raising the probability of an active, early start to the hurricane season. Finally, commodity associations may have some differences in what adjustments, if any, they want in the Farm Security and Rural Investment Act of 2002 but they agree that maintaining a unified front when talks begin in earnest will be crucial to hanging onto the program they have or at least using it as a base for one they hope to be nearly as good.

You'll find these stories and a lot more in this issue of Crop News Weekly, so get started!



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  FROM OUR MAGAZINES
E-85 available at Wal-Mart?
06/13/06   
What the oil companies won't do, Wal-Mart may. The world's largest retailer said last week it may offer ethanol-based E-85 fuel at nearly 400 of its gas stations in the U.S. Although company officials say they're not making a definite commitment, they obviously have been studying the situation carefully. At a Washington meeting that included industry, government, and academic sectors, Wal-Mart execs discussed ways to develop an infrastructure for supplying E-85 fuel to stations at its stores and Sam's Clubs. - Hembree Brandon, Farm Press Editorial Staff

Conference committee bows to president's wishes
06/12/06   
A House-Senate Conference Committee voted to scale down the $3.9 billion in disaster aid that the Senate included in the fiscal year 2006 emergency supplemental appropriations bill. The conference report provides $500 million for producers who were in declared primary and contiguous disaster counties in the paths of Hurricanes Katrina, Ophelia, Rita and Wilma in 2005. President Bush had threatened to veto the supplemental bill if it contained the full $3.9 billion. - Farm Press Editorial Staff

Growers unite to oppose lifting import tariff on ethanol
06/13/06   
It's not often that the National Corn Growers Association and the American Corn Growers Association come down on the same side of an issue. When they do, you can bet that farmers may be getting gored by somebody. In this case, the conservative NCGA and the more progressive ACGA, along with Farm Bureau and the Renewable Fuels Association, are opposing efforts by House leaders and the Bush administration to suspend import tariffs on ethanol to supposedly bring down prices of the alternative fuel. - Forrest Laws, Farm Press Editorial Staff

Soy-based products are helping clean up this spring
06/10/06   
With the start of spring, many people are dusting off lawn mowers and touch up their homes, yards and cars as usual. However, this year consumers may notice the cost of petroleum-based products, like cleaners, oils and building supplies, are rising. These costs have caused many people to look for alternatives, and soy is providing the answers. The United Soybean Board (USB) and the soybean checkoff are supporting the development of soy-based products that overcome these price challenges. Novel soy-based products on the market are helping manufacturers and do-it-yourselfers alike save money without sacrificing performance as they work around the house this spring. - Farm Press Editorial Staff

U.S., Vietnam clear WTO hurdle
06/12/06   
U.S. and Vietnamese officials have signed a new bilateral trade agreement on the accession terms that will allow Vietnam to join the World Trade Organization after it opens more of its markets to foreign goods. Under the agreement signed in Ho Chi Minh City, Vietnam has agreed to reduce its tariffs to 15 percent on 94 percent of U.S. manufacturing goods and 75 percent of farm products. But the pact could also help drive another nail into the coffin of the U.S. textile and apparel manufacturing sector, a spokesman for the latter said. - Forrest Laws, Farm Press Editorial Staff

USDA cuts wheat production estimate
06/09/06   
USDA lowered its estimate of production for the U.S. wheat crop by 59 million bushels from last month -- from 1.87 billion bushels to 1.81 billion bushels -- based on lower forecasted yield for winter wheat. Ending stocks were lowered 32 million bushels to 416 million bushels. Wheat feed and residual use was lowered to an estimated 25 million bushels, and seed use was raised 2 million bushels. USDA's assessment of crop production for the following crops is based on acreage estimates from USDA's March 31 Prospective Plantings report. The estimates are highly tentative. - Elton Robinson, Farm Press Editorial Staff

Early, active hurricane season possible
06/07/06   
Abnormally warm water temperatures in the Gulf of Mexico and Caribbean Sea are raising the probability of an active, early start to the hurricane season. The official Atlantic hurricane season runs from June 1 through Nov. 30. However, tropical systems can and do form outside the official season. Historically, early season tropical systems form in the Gulf of Mexico or the Caribbean Sea. In June, the surface-water temperatures in these regions are normally reaching the critical 82 degrees usually necessary to support the development of tropical systems. In early May 2006, much of the Caribbean Sea had already reached the critical 82-degree level. - David Emory Stooksbury State Climatologist University of Georgia

Unified front critical to maintain 2002 farm law
06/09/06   
Commodity associations may have some differences in what adjustments, if any, they want in the Farm Security and Rural Investment Act of 2002 but they agree that maintaining a unified front when talks begin in earnest will be crucial to hanging onto the program they have or at least using it as a base for one they hope to be nearly as good. - Ron Smith, Farm Press Editorial Staff

News from the Top of the Hill
06/09/06    National Hog Farmer
EQIP Fails Pork Producers -- The National Pork Producers Council (NPPC) told the Senate Agriculture Committee that the Environmental Quality Incentives Program (EQIP) was failing to help pork producers comply with environmental regulations. According to NPPC, pork producers received just 3 percent ($43 million out of $1.26 billion) of the EQIP cost-share assistance provided to all livestock producers. This is less than the amount received by goat, emu, ostrich, elk, and bison producers. In testimony before the Senate Agriculture Committee, NPPC presented its preliminary observations on EQIP:

  • "Compared with other livestock species, pork producers already have invested in sound manure management systems. (Manure is a top environmental issue for livestock producers.)

  • EQIP funds generally are not available for mobile equipment, which is one of pork producers' greatest needs to better manage and apply manure.

  • EQIP in several states has not integrated USDA's commitment to comprehensive nutrient (manure) management plans and has not provided enough money for producers to use technical service providers to prepare such plans.

  • Because of their high costs, it often is economically infeasible to purchase air emissions mitigation technologies with the limited EQIP funds."

    US-Korea Begin FTA Negotiations -- This week the United States and Korea began negotiations on a free trade agreement (FTA) between the two countries. The goal is to complete the FTA by the end of the year. Contentious issues will be automobiles, rice and beef.

    AG Groups Tell Administration No Further Cuts in WTO Negotiations -- A number of farm organizations sent a letter to President Bush indicating they would not support any administration proposal to offer additional reductions in domestic farm programs unless other countries agree to reduce their farm subsidies and tariffs. Regarding the WTO negotiations, the agriculture groups wrote, "Mr. President, we believe that it is important to make clear that American agriculture will not support any deeper cuts in domestic support than those already proposed by the administration. If negotiators are forced to scale back the level of ambition from the U.S. proposal on agricultural market access in order to reach an agreement, the level of ambition in cutting trade-distorting domestic support must be commensurately reduced from the U.S. proposal." The United States has proposed a 60 percent reduction in farm subsidies. Those signing the letter included the American Farm Bureau Federation, American Soybean Association, National Association of Wheat Growers, National Corn Growers Association, National Cotton Council, National Milk Producers Federation, and USA Rice Federation.

    Ban Japanese Beef -- Senator Ben Nelson (D-NE) has introduced legislation (S. 3364) that would discontinue the importation of Japanese beef into the U.S. until Japan reopens its market to U.S. beef. Senator Nelson said, "My plan is very straightforward. Either Japan has to once again accept US beef, or we will no longer accept Japanese beef. This is about restoring fairness with regard to beef trade with Japan."

    Incentives to Complete EQIP Practices - Deadline Extended -- USDA announced the deadline for completing environmental projects to qualify for the Environmental Quality Incentives Program (EQIP) energy cost assistance will be extended to September 1, 2006. Secretary of Agriculture Mike Johanns said, "Farmers and ranchers have put various conservation practices on hold because of the recent increases in the cost of energy. As part of our commitment to help mitigate the impact of high energy costs on agricultural producers, this cost adjustment and time extension will lessen the impact of energy prices on farmers and ranchers, while protecting our natural resources." The original deadline for completion of the EQIP projects was June 30 to receive incentive payments. For more information go to http://www.nrcs.usda.gov.

    USDA Announces CRP Sign-Up -- USDA announced that one million acres offered under the Conservation Reserve Program (CRP) general sign-up has been accepted. Also, 13 million acres set to expire this September have been re-enrolled. The Farm Service Agency received 22,990 offers for enrollment and accepted 18,140. Those offers accepted will become effective October 1. - Scott Shearer

  • Farm groups: Scale back Doha if talks falter
    06/07/06   
    WTO negotiators are now more than a month behind on meeting an April 30 deadline for an agreement on "modalities" or a formal blueprint for resolving the remaining issues in the Doha Development Agenda. As pressure mounts for WTO members not to miss another deadline -- on July 31 -- farm organizations and congressional leaders are urging the Bush administration to refuse demands it give more ground in the talks. Several of the nation's largest farm organizations wrote President Bush June 1, expressing concern and reminding him the administration has promised it will not make more concessions unless the European Union and other countries provide greater market access. - Forrest Laws, Farm Press Editorial Staff

    USDA to enroll 1 million new acres in CRP
    06/06/06   
    USDA will accept 1 million new acres into the Conservation Reserve Program from the CRP general sign-up that occurred in March and April, Deputy Agriculture Secretary Charles Conner announced. He said current CRP participants also intend to re-enroll and extend contracts covering 13 million acres set to expire Sept. 20, 2007. Forrest Laws, Farm Press Editorial Staff

    Thiesse's Thoughts: CCP details
    Counter-cyclical payments (CCP) for corn and soybeans are based on the national average price for that commodity from Sept. 1 in the year of harvest through August 31 the following year (crop marketing year). The crop marketing year for wheat and other small grains is June 1 in the year of harvest through May 31 the following year. The monthly average grain prices for each commodity are weighted for the volume sold each month to determine the final 12-month national average price for a commodity. If the 12-month national average price for a commodity is lower than the target price for that commodity minus the Direct payment rate for that commodity, a CCP is earned. - Kent Thiesse, The Corn & Soybean Digest

    The most important factor impacting agriculture
    Agriculture Road Warrior Dave Kohl writes: "At the last ECI Agricultural Lending Technology conference, one of the attendees asked, "What is the most important factor impacting agriculture and ag lending?" Let's examine this from the perspective of an agricultural producer's financial statements. Concerning the balance sheet, the number one factor would be the value of land. Ag lenders need to do an earned net worth analysis. In recent years, what percent has come from appreciated vs. earned net worth? My best estimate would be at least 75 percent appreciated net worth vs. earned net worth, which has given both producers and lenders a false sense of security." - The Corn & Soybean Digest

    Funding set for FY 2006 CSP contracts
    06/07/06   
    Agriculture Secretary Mike Johanns today announced USDA will provide nearly $440 million in funding for 4,404 Conservation Security Program contracts across the United States, Puerto Rico and Guam. "This year more producers enrolled in the CSP, demonstrating that incentives work for voluntary conservation programs," said Johanns. "The conservation benefits derived from this program will help farmers and ranchers improve their operations and increase the quality of our natural resources." - Farm Press Editorial Staff

    Johanns extends deadline for EQIP energy program
    06/06/06   
    Agriculture Secretary Mike Johanns announced he is extending the deadline for completing environmental projects to qualify for the Environmental Quality Incentives Progr am energy cost assistance to Sept. 1. The deadline was June 30. "Farmers and ranchers have put various conservation practices on hold because of the recent increases in the cost of energy," said Johanns. -Farm Press Editorial Staff



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