Printable Page US Ag News   Return to Menu - Page 1 2 3 4 5 6
 
 
Market Matters Blog           08/19 11:40
USACE Running Out of Funds to Continue Critical Dredging Operations
DTN Weekly Average DDG Price Lower
DTN National Average Soybean Basis Resembles Sunken Ship 
DTN Weekly Average DDG Price Weaker
If You Dredge It, They Will Come
DTN Weekly Average DDG Price Lower
Flooding Turns Mississippi River Into a Sandbox
DTN Weekly Average DDG Price Flat
Minimum Average Contract: A Smart Marketing Move
2019 Spring Wheat Tour Preview: After Rough Spring, What Will Scouts See?

******************************************************************************
USACE Running Out of Funds to Continue Critical Dredging Operations

   In my July 29 column, "Flooding Turns Mississippi River Into a Sandbox," I 
discussed the shoaling left behind on nearly the entire Mississippi River 
System by the 2019 flooding. I noted that the Army Corp of Engineers Rock 
Island District said that, normally, dredging costs them $2 million, but this 
year, they are paying $10 million, or five times more than normal.

   
(https://www.dtnpf.com/agriculture/web/ag/blogs/market-matters-blog/blog-post/20
19/07/29/flooding-turns-mississippi-river)

   On Aug. 12, the Army Corp of Engineers put out an SOS to the River Industry 
Executive Task Force (RIETF) that the Rock Island Engineer District would have 
to start removing dredges from the rivers on Aug. 17 due to a lack of funding. 

   According to an article in the Waterways Journal Aug. 19 newsletter, the 
district said it had not yet received emergency dredging funds allocated by 
Congress. They were referring to the June 6 Additional Supplemental 
Appropriations for Disaster Relief Act of 2019, in which Congress provided an 
additional $100 million for "emergency operations, repairs, and other 
activities in response to such disasters" above and beyond the Corps' usual 
appropriations.

   (https://www.congress.gov/bill/116th-congress/house-bill/2157/text)

   Darin Adrian, RIETF co-chair, sent a letter to eight U.S. senators on Aug. 
13 warning about the funding for emergency dredging in the Rock Island District 
running out and urging Congress to direct the Corps to allocate the funds 
appropriated in the disaster relief act to avert additional disruptions to the 
nation's inland waterway transportation system.

   "The nation's waterway transportation system has been gravely harmed with 
river closures and severe tow restrictions throughout the system since late 
2018 due to unprecedented flooding," Adrian stated in the letter, the full text 
of which was published by American Commercial Barge Line in its daily online 
newsletter "American Currents." 

   "After 85 days of closure on the Upper Mississippi River and lengthy 
closures on most major rivers, barge traffic is finally moving," Adrian stated. 
"Despite the re-opening, barge traffic is still moving with restricted tows and 
random river closures. 

   "In fact, funding for emergency dredging in the Rock Island District will be 
exhausted in the coming days and the Corps anticipates that the Dredge Goetz 
will cease operations by Saturday, Aug. 17, due to lack of funding. We are 
requesting your help to ensure that the funds appropriated with the passage of 
H.R. 2157 -- Additional Supplemental Appropriations for Disaster Relief Act, 
2019 ($100 million) -- be made available immediately. The industry members of 
RIETF urges Congress to direct the Corps to allocate the funds to avert 
additional disruptions to the nation's inland waterway transportation system." 

   Adrian told senators that, without immediate action, over 20 reaches of the 
Mississippi River in the Rock Island District alone were in danger of closure 
by Aug. 17. He said RIETF also expected similar dredging issues to affect the 
St. Paul District, the St. Louis District, the Lower Mississippi, and other 
waterways in the near future if emergency funding wasn't distributed to the 
appropriate districts. 

   "If this vital segment of the Upper Mississippi River is not maintained to 
its fully authorized width and depth, the nation's heartland will face severe 
economic consequences," Adrian said.

   SHOALING MORE PROBLEMATIC THAN NORMAL IN 2019

   Dredging is not an unusual event on the river. The USACE St. Paul District 
notes on their website that sedimentation (shoaling) in navigational channels 
can be caused by the normal cycle of silt movement, erosion from high water or 
heavy rains and changes in river currents. To maintain the 9-foot navigation 
channel every shipping season, material that settles in the channel area is 
removed by mechanical or hydraulic dredging.

   However, the relentless flooding of 2019 left behind a big mess throughout 
the Mississippi River System and its navigable tributaries. Areas on the Upper 
Mississippi River have been shut down recently because of barge groundings or 
have seen slowdowns in traffic because of shoaling, even with the Corps 
dredging constantly over the entire summer so far. Dredging has also been 
started in the Lower Mississippi River after the floodwaters finally receded 
there.

   American Commercial Barge Line noted there are many problem spots on the 
Lower Mississippi, with the major one at Victoria Bend (LM 595). This area is 
restricted to daylight only for tows with 30 or more barges and there is 
currently not a dredge scheduled in this area to assist with this problem. 
Delays and slow transit in this area are expected to last until the end of the 
August.

   Another location causing problems for transit is LM 807 just below 
Blytheville, Arkansas, where the Mississippi River is very swift and boats are 
having issues making it through the area heading northbound without an assist 
boat. 

   On the Arkansas River, a major tributary of the Mississippi River, there is 
significant shoaling located at miles 222 and 350 with both areas being 
dredged, while dredges continue to work on problem areas above Van Buren (AK 
298), according to ACBL. 

   "There were barges stuck on ground holding the lock gate open at Lock 16 (AK 
366)," ACBL said. "In order to get the barges off ground and out of the way of 
the lock gate, the Corps had to drain the pool above the lock and in doing this 
they will lose the pool. It is then expected to take several weeks to close the 
locks and several more weeks for them to restore the pool. Given this 
information there is currently no estimation on when we will be able to reach 
Catoosa."

   I contacted the USACE Rock Island District late on Friday, Aug. 16, and 
asked if they had any update on the funding needed to keep dredging. They 
responded: "Our Operations Division Chief Tom Heinold confirmed earlier today 
that the Dredge Goetz has funding to operate through the weekend due to limited 
funding received from USACE St. Louis District. Beyond that, we do not have any 
further updates on supplemental funding."

   ACBL also noted late Friday afternoon in their newsletter, "The U.S. 
government has provided funding for dredging operations on the Upper 
Mississippi through the week of Aug. 18."

   Given that dredging will likely need to continue for many months along the 
entire river system, it is imperative that the funds allocated by H.R. 2157 are 
dispersed to all the districts in need so they can continue to keep the river 
safe for barges moving north and south.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
DTN Weekly Average DDG Price Lower

   OMAHA (DTN) -- The domestic distillers dried grains (DDG) weekly average 
spot price from the 40 locations DTN contacted was down $4, at $130 per ton, 
for the week ended Aug. 15. Prices moved lower after the limit-down close in 
corn Monday and the additional losses on Tuesday and Wednesday, as well as 
losses in the soymeal market pressuring feed prices.

   The Energy Information Administration reported midweek that ethanol 
inventory in the U.S. was higher for the week ended Aug. 9, rising for the 
sixth time in seven weeks, while domestic plant production continued higher.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended Aug. 15 was at 100.90% versus the two-year average 
of 107.00%. The value of DDG relative to soybean meal was at 44.51%. The cost 
per unit of protein for DDG was $4.81, compared to the cost per unit of protein 
for soybean meal at $6.14. 

   In its weekly export DDGS update, the U.S. Grains Council stated, 
"Merchandisers note there is still some elevation for September shipments out 
of the Gulf, but expectations are that elevations will tighten like they have 
so far in August. Prices for DDGS CIF NOLA barge are near $169 per metric ton 
(MT) for September while FOB Gulf values are slightly lower at $187/MT for the 
same month. Prices for 40-foot containers to southeast Asia are slightly lower 
this week at $230/MT."


ALL PRICES SUBJECT TO CONFIRMATION            CURRENT        PREVIOUS   CHANGE
COMPANY    STATE                             8/15/2019       8/8/2019
Bartlett and Company, Kansas City, MO (816-753-6300)
           Missouri                 Dry         $150           $155      -$5
                                    Wet         $75            $78       -$3
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
           Missouri Subject         Dry         $135           $135       $0
                                    Wet         $70            $70        $0
CHS, Minneapolis, MN (800-769-1066)
           Illinois                 Dry         $135           $140      -$5
           Indiana                  Dry         $130           $135      -$5
           Iowa                     Dry         $115           $120      -$5
           Michigan                 Dry         $140           $145      -$5
           Minnesota                Dry         $115           $120      -$5
           North Dakota             Dry         $120           $125      -$5
           New York                 Dry         $135           $140      -$5
           South Dakota             Dry         $115           $120      -$5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
           Kansas                   Dry         $130           $135      -$5
POET Nutrition, Sioux Falls, SD (888-327-8799)
           Indiana                  Dry         $135           $145      -$10
           Iowa                     Dry         $130           $125       $5
           Michigan                 Dry         $120           $125      -$5
           Minnesota                Dry         $125           $125       $0
           Missouri                 Dry         $140           $150      -$10
           Ohio                     Dry         $135           $150      -$15
           South Dakota             Dry         $135           $140      -$5
United BioEnergy, Wichita, KS (316-616-3521)
           Kansas                   Dry         $135           $135       $0
                                    Wet         $40            $40        $0
           Illinois                 Dry         $135           $140      -$5
           Nebraska                 Dry         $135           $135       $0
                                    Wet         $40            $40        $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
           Illinois                 Dry         $130           $135      -$5
           Indiana                  Dry         $135           $137      -$2
           Iowa                     Dry         $125           $130      -$5
           Michigan                 Dry         $130           $135      -$5
           Minnesota                Dry         $120           $125      -$5
           Nebraska                 Dry         $122           $130      -$8
           New York                 Dry         $150           $150       $0
           North Dakota             Dry         $130           $130       $0
           Ohio                     Dry         $150           $150       $0
           South Dakota             Dry         $125           $125       $0
           Wisconsin                Dry         $130           $130       $0
Valero Energy Corp, San Antonio Texas    (210-345-3362)     (210-345-3362)
           Indiana                  Dry         $130           $130       $0
           Iowa                     Dry         $125           $125       $0
           Minnesota                Dry         $120           $125      -$5
           Nebraska                 Dry         $135           $135       $0
           Ohio                     Dry         $135           $145      -$10
           South Dakota             Dry         $128           $128       $0
           California               Dry         $178           $185      -$7
Western Milling, Goshen, California (559-302-1074)
           California               Dry         $188           $195      -$7
*Prices listed per ton.
           Weekly Average                       $130           $134      -$4
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

   **


                     VALUE OF DDG VS. CORN & SOYBEAN MEAL
                        Settlement Price:   Quote Date      Bushel  Short Ton
                                     Corn      8/15/2019   $3.6075      $128.84
                             Soybean Meal      8/15/2019   $291.80
            DDG Weekly Average Spot Price        $130.00
                                  DDG Value Relative to:   8/15        8/8
                                                    Corn   100.90%       91.29%
                                            Soybean Meal    44.51%       45.45%
                               Cost Per Unit of Protein:
                                                     DDG     $4.81        $4.96
                                            Soybean Meal     $6.14        $6.21
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
DTN National Average Soybean Basis Resembles Sunken Ship 

   Every weekday, DTN collects about 2,940 soybean bids from around the country 
and from those bids the national average basis is produced. If you look at DTN 
national average basis chart that coincides with this article, you will see 
that for the entire 2018-19 crop year, it has laid on the very bottom of the 
chart like a sunken ship in the deepest part of the ocean. 

   For the current 2018-19 crop year, which is soon to expire on Aug. 30, 
soybean basis has been pathetic. Much of that can be attributed to the trade 
war that has been going on between China and the U.S. for more than one year 
now. When the trade war started in mid-June 2018, shuttle basis for soybeans 
delivered to the Pacific Northwest (PNW) immediately disappeared. With the 
majority of soybean exports going to China off the PNW, the trade war shut 
those exports off and in turn left farmers in North Dakota, South Dakota and 
western Minnesota with no export market for their soybeans except to the Gulf.

   However, that Gulf soybean market became overwhelmed and basis weakened to 
that market as well. On top of that, logistics turned into a complete nightmare 
as flooding overwhelmed the Mississippi River system starting at the Gulf in 
January 2019 and overtaking the entire system through June. The flooding caused 
major closures of locks and dams and shut down the St. Louis Harbor numerous 
times, stopping all barge traffic. When the river finally reopened, the backup 
of barges caused traffic jams up and down the river.

   SALES SLOWLY PICKED UP ONLY TO BE STOPPED AGAIN

   There was a glimmer of hope in December 2018 with China buying U.S. 
soybeans, their first major purchases in six months. In early 2019, China 
state-owned firms purchased U.S. soybeans a day after talks between the U.S. 
and China showed progress towards a trade deal, with a commitment from China to 
buy more U.S. soybeans as a measure of "good will."

   In late June 2019, the USDA reported export sales of 544,000 metric tons of 
soybeans for delivery to China during the 2018-19 marketing year. On Aug. 1, 
the USDA announced U.S. soybeans sold to China, the first since late June and 
the first since the Chinese government offered to exempt five private crushers 
in the country from the 25% import tariffs on U.S. beans arriving by the end of 
2019. However, that same announcement included an even larger cancellation of 
soybeans previously purchased by China.

   Then, all hell broke loose shortly after noon CDT on Aug. 1 when President 
Trump announced on Twitter that he would impose a new 10% tariff on $300 
billion of Chinese goods, set for Sept. 1, with China's failed promises to buy 
U.S. goods as one of the reasons. That news sent the soybean basis on the PNW 
to drop as much as 30 cents, once again causing the basis in the areas that 
ship to the PNW to weaken basis for their farmers.

   To add salt to that open wound, various news organizations reported that 
China's Ministry of Commerce said in a posting online that Chinese companies 
suspended purchases of U.S. agricultural products, saying suspension would 
continue until the U.S. created the necessary conditions for cooperation 
between the two nations.

   BASIS BIDS BETTER IN PARTS OF THE MIDWEST 

   Angie Setzer, vice president of Grain Citizens LLC, Charlotte, Michigan, 
told me on Aug. 9 that, "in our area we've actually seen basis strengthen as a 
lot of what was intended to get planted to beans was either not able to get 
into the ground or went in way later than normal. The later-than-normal 
planting has obviously increased concerns over what an early frost would mean." 

   Setzer added that the supply uncertainty, coupled with a new 
40-million-bushel-per-year crushing plant going online, has created strength in 
basis not seen the last couple of years. "There are still a decent number of 
beans on the farm, but those are currently being held in relatively tight hands 
as well. Many farmers are waiting to see what they are going to produce or what 
the market is going to do before making sales. Many commercials are making sure 
we will have a decent crop before liquidating their remaining supplies as well."

   As for basis in the areas that rely on a strong soybean export program on 
the PNW, basis has weakened further after China said they would stop U.S. 
soybean purchases.

   A manager of a shuttle basis facility in central North Dakota told me that 
when the China talks failed and the new tariff was announced, the PNW tanked 
and moved to the equivalent of a St Louis bid. He said that while there was a 
rail rate for St. Louis put in place when the tariff war began, that rate to 
St. Louis only runs through August. 

   He noted that many shuttle loaders there have weakened local basis and when 
I checked websites of the shuttle loaders in eastern North Dakota, the nearby 
basis bids were $1.30 to $1.35 under the November futures, with new-crop basis 
posted at $1.40 under November futures.

   "Maybe we lose the eastern bean crop and they pull beans over the river," he 
added. Should that happen, and if the railroad extends the rates out of his 
area to St. Louis, that could give some hope to the farmers in the U.S. 
Northern Plains. 

   However, soybeans shipped out of St. Louis to the Gulf rely on a strong 
export market and for this crop year, that hasn't been the case. In the Aug. 8 
weekly export sales and shipment report, USDA noted that 2018-19 soybean export 
commitments are down 17% from one year ago for that same timeframe. 

   The Wall Street Journal noted in an Aug. 2 article that recent U.S. Census 
Bureau data showed that U.S. exports to China fell 19% for the first half of 
the year, as "tit-for-tat tariffs and other barriers imposed by Washington and 
Beijing took their toll." After holding the top spot among U.S. trading 
partners from 2015 to 2018, China now sits at No. 3 and is smaller than Mexico 
for the first time since 2005, noted the article.

   In the meantime, it appears the DTN national average soybean basis will end 
the current crop year at its lowest level in five years. 

   The way things are looking now, it will likely start the new crop year on 
the bottom, right where it left off, with little hope of it being salvaged 
anytime soon.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
DTN Weekly Average DDG Price Weaker

   OMAHA (DTN) -- The domestic distillers dried grains (DDG) average spot price 
from the 40 locations DTN contacted was down $1, at $134 per ton, for the week 
ended Aug. 8. We are hearing reports some ethanol plants are selling more DDG 
on a spot or prompt delivery basis with expectations that ethanol production 
may slow in the near future, which would affect DDG supplies. 

   The Energy Information Administration reported in its Aug. 8 "Today in 
Energy" brief that ethanol operating margins have recently fallen further as a 
result of sharp increases in corn prices. Iowa corn spot prices averaged about 
$4.20 per bushel in June, 15% higher than the previous month and the highest 
price since June 2016. "Corn prices have been driven up because significant 
flooding in the Midwest has delayed expected harvests and potentially lowered 
corn yields. Higher feedstock costs and relatively unchanged ethanol demand 
have driven ethanol margins and profitability to multiyear lows, and current 
ethanol production levels may soon be affected," noted the EIA.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended Aug. 8 was at 91.29%. The value of DDG relative to 
soybean meal was at 45.45%. The cost per unit of protein for DDG was $4.96, 
compared to the cost per unit of protein for soybean meal at $6.21. 

   In its weekly export DDGS update, the U.S. Grains Council stated, "Prices 
are lower this week but exporters report that active inquiries from Southeast 
Asia, combined with expectations of slowing production, have created near-term 
outlooks for higher prices. Prices for DDGS CIF NOLA barge are $2.50 per metric 
ton (MT) higher this week while FOB Gulf values are slightly lower at $196/MT. 
Prices for 40-foot containers are $11/MT lower this week at $231/MT for August 
shipment, but increasing international interest has exporters defending offers."


ALL PRICES SUBJECT TO CONFIRMATION       CURRENT     PREVIOUS CHANGE
COMPANY       STATE                      8/8/2019    8/1/2019
Bartlett and Company, Kansas City, MO (816-753-6300)
              Missouri           Dry       $155        $155     $0
                                 Wet       $78         $78      $0
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
              Missouri Subject   Dry       $135        $140    -$5
                                 Wet       $70         $72     -$2
CHS, Minneapolis, MN (800-769-1066)
              Illinois           Dry       $140        $140     $0
              Indiana            Dry       $135        $135     $0
              Iowa               Dry       $120        $125    -$5
              Michigan           Dry       $145        $145     $0
              Minnesota          Dry       $120        $120     $0
              North Dakota       Dry       $125        $125     $0
              New York           Dry       $140        $145    -$5
              South Dakota       Dry       $120        $120     $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
              Kansas             Dry       $135        $135     $0
POET Nutrition, Sioux Falls, SD (888-327-8799)
              Indiana            Dry       $145        $150    -$5
              Iowa               Dry       $125        $125     $0
              Michigan           Dry       $125        $125     $0
              Minnesota          Dry       $125        $130    -$5
              Missouri           Dry       $150        $150     $0
              Ohio               Dry       $150        $160    -$10
              South Dakota       Dry       $140        $140     $0
United BioEnergy, Wichita, KS (316-616-3521)
Kansas        Dry                $135      $135         $0
              Wet                $40       $40          $0
Illinois      Dry                $140      $140         $0
Nebraska      Dry                $135      $135         $0
              Wet                $40       $40          $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
              Illinois           Dry       $135        $135     $0
              Indiana            Dry       $137        $137     $0
              Iowa               Dry       $130        $130     $0
              Michigan           Dry       $135        $135     $0
              Minnesota          Dry       $125        $125     $0
              Nebraska           Dry       $130        $130     $0
              New York           Dry       $150        $150     $0
              North Dakota       Dry       $130        $130     $0
              Ohio               Dry       $150        $150     $0
              South Dakota       Dry       $125        $125     $0
              Wisconsin          Dry       $130        $130     $0
Valero Energy Corp, San Antonio Texas (210-345-3362) (210-345-3362)
Indiana       Dry                $130      $130         $0
Iowa          Dry                $125      $125         $0
Minnesota     Dry                $125      $125         $0
Nebraska      Dry                $135      $135         $0
Ohio          Dry                $145      $145         $0
South Dakota  Dry                $128      $128         $0
California    Dry                $185      $185         $0
Western Milling, Goshen, California (559-302-1074)
California    Dry                $195      $198        -$3
*Prices listed per ton.
              Weekly Average               $134        $135    -$1
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

             VALUE OF DDG VS. CORN & SOYBEAN MEAL
               Settlement Price: Quote Date   Bushel Short Ton
                            Corn    8/8/2019 $4.1100   $146.79
                    Soybean Meal    8/8/2019 $294.80
   DDG Weekly Average Spot Price     $134.00
                      DDG Value Relative to:   8/8      8/1
                                        Corn  91.29%    96.24%
                                Soybean Meal  45.45%    46.04%
                   Cost Per Unit of Protein:
                                         DDG   $4.96     $5.00
                                Soybean Meal   $6.21     $6.17
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
If You Dredge It, They Will Come

    Last week, I wrote about the dredging throughout the Mississippi River 
because of the shoaling caused by the constant flooding, creating navigation 
hazards for barges. This week is about non-flood related dredging that could 
have a positive impact on farmers who haul soybeans and other grains to river 
terminals that eventually send them down the Mississippi to the Gulf of Mexico 
for export.

   As U.S. soybean farmers continue to encounter challenges with both growing a 
crop and marketing a crop, it is essential to maintain and enhance the 
transportation system established to transport those soybeans -- and all 
agricultural products. 

   The 256-mile stretch of the Mississippi River from Baton Rouge, Louisiana, 
to the Gulf of Mexico accounts for 60% of U.S. soybean exports, along with 59% 
of corn exports, and is by far the leading export region for both commodities. 
There is a growing effort among Mississippi River stakeholders, including 
agriculture, to promote the dredging of the lower river shipping channel from 
45 feet to 50 feet in depth. 

   On July 10, 2019, Soy Transportation Coalition (STC) in a press release said 
the United Soybean Board (USB) announced a $2 million allocation to help offset 
the planning, design and research costs of deepening the Lower Mississippi 
River. The 73 USB farmer-directors are responsible for investing soybean 
checkoff funds to enhance the value and preference for U.S. soy. 

   In the press release, Mike Bellar, a soybean farmer from Howard, Kansas, and 
chairman of the STC, said "During this challenging period, soybean farmers are 
being aggressive in trying to increase our competitiveness. The $2 million in 
funding from our national checkoff organization, the USB, will help improve our 
number one export region of U.S. soybeans. It will remain critical for the STC, 
the American Soybean Association, and the individual state soybean associations 
to continue to promote this project at the federal and state level."

   The overall project is estimated to cost $245 million and would occur in 
three phases. Two of the phases will be cost-shared between the federal 
government (75%) and non-federal sources (25%). The State of Louisiana has been 
designated as the obligated non-federal entity: 

   -- Dredging from Venice, Louisiana, (approximately Mile 10 Above Head of 
Passes [AHP]) to the Gulf of Mexico. Removing this bottleneck would provide a 
50-ft. deep channel to approximately Mile 154 [AHP] of the river. A substantial 
number of soybean and grain export terminals are located within this portion of 
the river. The estimated cost of this phase is $100 million. Given a 75% 
federal and a 25% non-federal cost share, the federal obligation would be $75 
million, and the non-federal obligation would be $25 million. 

   -- Dredging from Mile 154 AHP to Baton Rouge, Louisiana, (Mile 232 AHP). The 
remaining soybean and grain export terminals would be included in the 50-ft. 
shipping channel upon completion of this phase. The estimated cost of this 
phase is $65 million. Given a 75% federal and a 25% non-federal cost share, the 
federal obligation would be $48.75 million, and the non-federal obligation 
would be $16.25 million. 

   -- The relocation of pipelines buried under the northern portion of the 
shipping channel. The estimated $80 million cost of doing so would be split 
evenly between the state of Louisiana and the pipeline owners. 

   USB is allocating the $2 million to help offset planning, design and 
research costs, combined with approximately $21 million in federal funding and 
$7.5 million in funding from the state of Louisiana to initiate the first 
year's work of the project (i.e. commencing the deepening of the river from 
Venice, Louisiana, to the Gulf of Mexico). While the state of Louisiana has 
provided its initial $7.5 million allocation of matching funds, the federal 
government has yet to approve its approximately $21 million in initial funding.

   Recent research conducted by the STC concludes that shipping costs for 
soybeans from Mississippi Gulf export terminals would decline 13 cents per 
bushel ($5 per metric ton) if the lower Mississippi River is dredged to 50 ft. 
A deeper river will allow both larger ships to be utilized and current ships 
being utilized to be loaded with more revenue-producing freight.

   "The research also identifies the impact on interior basis, which is the 
difference between the local price a farmer receives, and the market value 
established by the Chicago Board of Trade for soybeans in 31 states if the 
lower Mississippi River shipping channel is dredged," noted Mike Steenhoek, 
executive director of the STC. 

   Here is a link to the press release, along with the full STC report that 
gives detailed examples of freight savings and basis impact the project would 
have: "Soybean Farmers Strategically Invest in Key Link in Supply Chain" and 
"STC Research Identifies Farmer Benefit of Dredging the Lower Mississippi River 
-- Full Report": https://www.soytransportation.org/news.html

   "If I had to select a single infrastructure enhancement that would provide 
the most benefit to the greatest number of U.S. soybean farmers, deepening the 
lower Mississippi River would be my choice," said Steenhoek. "Soybean farmers 
are demonstrating a willingness to collaborate with federal and state 
government on an innovative public private partnership that will enhance the 
competitiveness of both agriculture and a host of other industries. The STC, 
the American Soybean Association, state soybean associations and other 
stakeholder groups look forward to working together to ensure this critical 
project becomes a reality."

   Steenhoek noted that all too often infrastructure investment is allowed to 
become a "theoretical issue" and that the STC research clearly explains how 
this single infrastructure enhancement will have a tangible benefit to 
individual farmers in individual states throughout the country. 

   "If our nation desires to make our farmers more competitive in a turbulent 
marketplace, this investment would be an excellent place to start. May we have 
the will to do so," concluded Steenhoek.

   Here is a link to the detailed comparison in the size of a ship that would 
need a 50-foot draft to enter a port: https://en.wikipedia.org/wiki/Panamax

   Here is a link to give you a thorough understanding of everything to do with 
the process of dredging from beginning to end: 
https://en.wikipedia.org/wiki/Dredging

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
DTN Weekly Average DDG Price Lower

   OMAHA (DTN) -- The domestic distillers dried grains (DDG) average spot price 
from the 40 locations DTN contacted was down $5, at $135 per ton, for the week 
ended Aug. 1. 

   DDG spot prices have come under pressure from the losses in the corn market 
the past 10 days and the weakness in soybean meal and other feedstuffs, in 
addition to a slowdown in summer demand.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended Aug. 1 was at 96.24%. The value of DDG relative to 
soybean meal was at 46.04%. The cost per unit of protein for DDG was $5.00, 
compared to the cost per unit of protein for soybean meal at $6.17. 

   The midweek Energy Information Administration report noted that ethanol 
supply in the U.S. increased for a fifth straight week in the week ended July 
26, up 779,000 barrels (bbl) to a 24.468-million-bbl record high, building 
despite another decline in domestic plant production that fell to the lowest 
level since late April.

   In its weekly export DDGS update, the U.S. Grains Council stated, "Prices 
for DDGS CIF NOLA barge and FOB U.S. Gulf are lower this week as improving 
Mississippi River conditions have allowed once-trapped barges to move downriver 
to the Gulf. Merchandisers report that Gulf capacity is tight and that is 
keeping asking prices competitive. Exporters note that international demand is 
somewhat quieter this week and that the CBOT selloff in corn and soybean meal 
futures has influenced DDGS as well. FOB NOLA price indications were last 
quoted at $200 per metric ton (mt) while 40-foot containers CNF Southeast Asia 
were steady this week at $236/mt."


ALL PRICES SUBJECT TO CONFIRMATION            CURRENT        PREVIOUS   CHANGE
COMPANY    STATE                             7/25/2019       7/25/2019
Bartlett and Company, Kansas City, MO (816-753-6300)
           Missouri                 Dry         $155           $155       $0
                                    Wet         $78             $78       $0
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
           Missouri Subject         Dry         $140           $150      -$10
                                    Wet         $72             $78       -$6
CHS, Minneapolis, MN (800-769-1066)
           Illinois                 Dry         $140           $145       -$5
           Indiana                  Dry         $135           $140       -$5
           Iowa                     Dry         $125           $130       -$5
           Michigan                 Dry         $145           $150       -$5
           Minnesota                Dry         $120           $125       -$5
           North Dakota             Dry         $125           $130       -$5
           New York                 Dry         $145           $150       -$5
           South Dakota             Dry         $120           $125       -$5
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
           Kansas                   Dry         $135           $140       -$5
POET Nutrition, Sioux Falls, SD (888-327-8799)
           Indiana                  Dry         $150           $155       -$5
           Iowa                     Dry         $125           $130       -$5
           Michigan                 Dry         $125           $130       -$5
           Minnesota                Dry         $130           $135       -$5
           Missouri                 Dry         $150           $155       -$5
           Ohio                     Dry         $160           $165       -$5
           South Dakota             Dry         $140           $145       -$5
United BioEnergy, Wichita, KS (316-616-3521)
           Kansas                   Dry         $135           $145      -$10
                                    Wet         $40             $40       $0
           Illinois                 Dry         $140           $145       -$5
           Nebraska                 Dry         $135           $145      -$10
                                    Wet         $45             $45       $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
           Illinois                 Dry         $135           $140       -$5
           Indiana                  Dry         $137           $142       -$5
           Iowa                     Dry         $130           $130       $0
           Michigan                 Dry         $135           $140       -$5
           Minnesota                Dry         $125           $130       -$5
           Nebraska                 Dry         $130           $135       -$5
           New York                 Dry         $150           $150       $0
           North Dakota             Dry         $130           $135       -$5
           Ohio                     Dry         $150           $150       $0
           South Dakota             Dry         $125           $130       -$5
           Wisconsin                Dry         $130           $135       -$5
Valero Energy Corp, San Antonio Texas    (210-345-3362)     (210-345-3362)
           Indiana                  Dry         $130           $140      -$10
           Iowa                     Dry         $125           $135      -$10
           Minnesota                Dry         $125           $135      -$10
           Nebraska                 Dry         $135           $135       $0
           Ohio                     Dry         $145           $150       -$5
           South Dakota             Dry         $128           $130       -$2
           California               Dry         $185           $195      -$10
Western Milling, Goshen, California (559-302-1074)
           California               Dry         $198           $203       -$5
*Prices listed per ton.
           Weekly Average                       $135           $140       -$5
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

   **


                     VALUE OF DDG VS. CORN & SOYBEAN MEAL
                        Settlement Price:   Quote Date      Bushel  Short Ton
                                     Corn       8/1/2019   $3.9275      $140.27
                             Soybean Meal       8/1/2019   $293.20
            DDG Weekly Average Spot Price        $135.00
                                  DDG Value Relative to:    8/1        7/25
                                                    Corn    96.24%       93.67%
                                            Soybean Meal    46.04%       46.07%
                               Cost Per Unit of Protein:
                                                     DDG     $5.00        $5.19
                                            Soybean Meal     $6.17        $6.40
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
Flooding Turns Mississippi River Into a Sandbox

   Since the beginning of 2019, parts of the Mississippi River were in flood 
stage, and as spring approached, the entire river system was flooding. It took 
over three months for many of those areas to finally fall below flood stage, 
and at this writing, there are some locations in the Lower Mississippi still 
trying to get to that point.

   Flooding causes sand and silt to be carried throughout the river due to 
stronger currents and faster movement of the water. This is also known as 
"shoaling," and the sandbars it can create cause dangerous conditions for 
barges moving up and down the river through the channels. Unless the 
sedimentation that settles in the channel area is removed, barges can run 
aground, as we have seen happen during times when the river is low, and 
sandbars can be a common sight. 

   The process of sediment removal is called "dredging" and is performed by a 
floating plant known as a dredger or dredge. A dredging schedule can be found 
on each USACE District website. The schedule by equipment includes information 
about where (by river mile) and what date(s) the dredging will occur. It also 
includes what depth and estimated quantities will be, where dredged material 
will be taken, and what piece of dredging equipment will be used. 

   It is the job of the U.S. Army Corps of Engineers to maintain a 9-foot 
channel in the navigation pool to allow safe passes for barges moving through 
the lock-and-dam system in their district. The St. Paul District is responsible 
for maintaining 243.6 miles of navigation channel to a depth of at least 9 feet 
on the Mississippi River from Minneapolis at river mile 857.6 to Guttenberg, 
Iowa, at river mile 614.0, and 40.6 miles on three tributaries: the Minnesota, 
St. Croix and Black rivers. The district is also responsible for supporting 
inland navigation by operating 13 locks and dams and by maintaining a 9-foot 
navigation channel. 

   The Corps operates those locks and dams on the Mississippi River for 
navigation, not flood control. The locks and dams create "slack-water pools for 
navigation during periods of low and moderate level water. For each pool, there 
is a primary control point, where a predetermined water elevation must be kept 
for navigation to continue," the Corps noted on their website. 

   The Corps started dredging in that district in late April, according to 
their schedule. As of July 23, dredging operations were going on at four 
locations on the Mississippi River in the St. Paul District. 

   George Stringham, public affairs for USACE St. Paul, told me in early June 
that the constant flooding in 2019 will likely keep the Corps dredging in the 
St. Paul District through the rest of the navigation season.

   You may wonder what happens to all of the material that is pulled out of the 
river by the dredge. The Corps noted on their website that it is placed in 
designated areas along the river. "Some of these areas are beneficial use 
placement areas," the Corps noted. 

   "Beneficial use of dredged material is the productive use of the material by 
the public or private sectors," the Corps stated on their website. "Examples of 
common beneficial uses of dredged material in the St. Paul District are upland 
habitat development, wetland creation, aquatic habitat enhancement, creation of 
areas for bird nesting, beach nourishment, winter road maintenance, levee 
repair and improvement, aggregate for concrete, lining fly ash pits, bank 
protection and general purpose fill."

   South of the St. Paul District is the Rock Island District whose waterway 
navigation system is the second longest of any Corps district, and the number 
of locks and dams it manages also ranks second within the Corps. The Rock 
Island District covers more than 78,000 square miles in Iowa, Illinois, 
Minnesota, Wisconsin and Missouri. The district has responsibility for 314 
miles of the Mississippi River and 268 miles of the Illinois Waterway and their 
tributaries. The Corps in this district has been dredging their navigation 
channels from the most recent flood since June, according to their schedule on 
their website.

   In a July 22 interview with WQAD in Moline, Illinois, Thomas Heinold, chief 
of operations for the Army Corp of Engineers Rock Island District, said, "We 
are on the river every year somewhere dredging, but this is a historic year. We 
are facing some imminent closures actually, we may have to go into restrictions 
and request that barges lighten their loads and draft less than 9 feet should 
we have shoaling in the river that we can't get to in time."

   Usually, this dredging process costs the Corps $2 million, but this year, 
they are paying $10 million, or five times more than normal, noted WQAD.

   "We still might not be able to keep up with it all; it's going to be a heck 
of a year," added Heinold.

   **

   Tune in next week for part two of my two-part series of columns on dredging 
on the U.S. river system when I will talk about non-flood related dredging.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
DTN Weekly Average DDG Price Flat

   OMAHA (DTN) -- The domestic distillers dried grains (DDG) average spot price 
from the 40 locations DTN contacted was unchanged at $140 per ton for the week 
ended July 25. DDG spot prices were mixed this week and feel lackluster 
overall, especially with the recent heat wave slowing nearby demand.

   Based on the average of prices collected by DTN, the value of DDG relative 
to corn for the week ended July 25 was at 93.67%. The value of DDG relative to 
soybean meal was at 46.07%. The cost per unit of protein for DDG was $5.19, 
compared to the cost per unit of protein for soybean meal at $6.40. 

   The midweek Energy Information Administration report noted that ethanol 
supply in the United States increased for the fourth consecutive week through 
July 19, up 300,000 barrels (bbl) to a 3-1/2 month high at 23.7 million bbl, 
while domestic plant output fell to a 2-1/2 month low.

   In its weekly export DDGS update, the U.S. Grains Council stated, "Prices 
for DDGS CIF NOLA barge and FOB U.S. Gulf are lower this week as traders keep 
the ethanol co-product competitive with lower corn and soymeal values. 
Merchandisers are reporting a significant increase in international buying 
interest as corn futures have stabilized in recent days. Exporters note Taiwan, 
Korea, the Philippines, Indonesia, Vietnam, and Bangladesh have been active 
markets for both inquiries and sales. Prices for 40-foot containers to 
Southeast Asia are averaging $244/MT, steady with last week's values."


ALL PRICES SUBJECT TO CONFIRMATION       CURRENT     PREVIOUS CHANGE
COMPANY             STATE  7/25/2019    7/18/2019
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri            Dry      $155          $160        -$5
Wet                  $78      $80          -$2
Show Me Ethanol LLC, Carrollton, MO (660-542-6493)
Missouri Subject    Dry      $150          $145         $5
Wet                  $78      $75           $3
CHS, Minneapolis, MN (800-769-1066)
Illinois            Dry      $145          $145         $0
Indiana             Dry      $140          $140         $0
Iowa                Dry      $130          $130         $0
Michigan            Dry      $150          $150         $0
Minnesota           Dry      $125          $132        -$7
North Dakota        Dry      $130          $132        -$2
New York            Dry      $150          $152        -$2
South Dakota        Dry      $125          $132        -$7
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas              Dry      $140          $140         $0
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana             Dry      $155          $160        -$5
Iowa                Dry      $130          $130         $0
Michigan            Dry      $130          $130         $0
Minnesota           Dry      $135          $130         $5
Missouri            Dry      $155          $160        -$5
Ohio                Dry      $165          $160         $5
South Dakota        Dry      $145          $145         $0
United BioEnergy, Wichita, KS (316-616-3521)
Kansas              Dry      $145          $145         $0
Wet                  $40      $40           $0
Illinois            Dry      $145          $145         $0
Nebraska            Dry      $145          $145         $0
Wet                  $45      $45           $0
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois            Dry      $140          $140         $0
Indiana             Dry      $142          $140         $2
Iowa                Dry      $130          $130         $0
Michigan            Dry      $140          $135         $5
Minnesota           Dry      $130          $130         $0
Nebraska            Dry      $135          $135         $0
New York            Dry      $150          $150         $0
North Dakota        Dry      $135          $135         $0
Ohio                Dry      $150          $150         $0
South Dakota        Dry      $130          $130         $0
Wisconsin           Dry      $135          $135         $0
Valero Energy Corp, San Antonio Texas (210-345-3362) (210-345-3362)
Indiana             Dry      $140          $140         $0
Iowa                Dry      $135          $135         $0
Minnesota           Dry      $135          $135         $0
Nebraska            Dry      $135          $135         $0
Ohio                Dry      $150          $150         $0
South Dakota        Dry      $130          $130         $0
California          Dry      $195          $195         $0
Western Milling, Goshen, California (559-302-1074)
California          Dry      $203          $205        -$2
*Prices listed per ton.
Weekly Average      $140     $140           $0
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

             VALUE OF DDG VS. CORN & SOYBEAN MEAL
               Settlement Price: Quote Date   Bushel Short Ton
                            Corn   7/25/2019 $4.1850   $149.46
                    Soybean Meal   7/25/2019 $303.90
   DDG Weekly Average Spot Price     $140.00
                      DDG Value Relative to:  7/25     7/18
                                        Corn  93.67%    92.34%
                                Soybean Meal  46.07%    45.60%
                   Cost Per Unit of Protein:
                                         DDG   $5.19     $5.19
                                Soybean Meal   $6.40     $6.46
Notes:
Corn and soybean prices take from DTN Market Quotes. DDG price
represents the average spot price from Midwest companies
collected on Thursday afternoons. Soybean meal cost per unit
of protein is cost per ton divided by 47.5. DDG cost per unit
of protein is cost per ton divided by 27.

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

   Follow her on Twitter @MaryCKenn

******************************************************************************
Minimum Average Contract: A Smart Marketing Move

   With December corn now 42 cents per bushel below the high of $4.73 made on 
June 17, but still some 67 cents above the contract low set back in mid-May, 
what kind of marketing strategy can a farmer employ? Although both of USDA's 
2018-19 and 2019-20 ending stocks estimates are currently bearish, the prospect 
for a sharp cut in 2019-20 ending corn stocks is possible in the Aug. 12 WASDE 
report. 

   If you are looking for a way to market some of your corn and still leave 
room for upside price appreciation, you might want to consider a Minimum 
Average Price contract. (The contract might be called by another name, 
depending on the cash grain company offering it.)

   The contract allows a farmer to establish a minimum selling price, but also 
participate in a potential market rise during a pre-determined averaging 
window. The contract works as follows: Every day during the pre-determined 
averaging period, an equal number of bushels is priced, with all of the bushels 
entered in the contract priced by the end of the contract period. Never would 
any bushels be priced below the pre-determined minimum or floor price. If, on 
any day, the market closes below the minimum price, that day's bushels would be 
priced at the minimum. On any days when the futures finish over the minimum, 
those bushels would be priced at the futures settlement price on that day. 

   At the end of the averaging period, all of your corn would be priced at the 
simple average of all days. For a nominal fee, to be determined by the chosen 
pricing period, the farmer will have a limited and pre-defined risk, while 
being able to take advantage of any upside. Never will the farmer have to deal 
with any options or pay any futures margin. The cash grain company that offers 
the contract will assume that risk and responsibility.

   We have, perhaps, the most important month ahead of us with respect to corn, 
including not only the Aug. 12 USDA report, but also the revelation of the 
second survey results and prevented planting data. The chance for a resurgence 
in price is certainly there, but no one can be certain of how things will turn 
out. The farmer can choose a shorter window for the averaging period or a 
longer one that extends into harvest. The shorter the time frame, the cheaper 
the cost of the contract. As an example, a contract that extends only to the 
end of August might cost 5 cents per bushel, but one that expires at the end of 
October might be 9 to 10 cents per bushel. The timeframe can be chosen by the 
farmer. 

   If you believe the corn market has upside and would like to make sure you 
get some new-crop corn sold while retaining plenty of upside (and do so at a 
very minimal fee), then this is the contract may be for you. A typical contract 
can be entered for a cost that might range between 5 and 10 cents per bushel. 
The Minimum Average Price contract is one that protects the downside and offers 
the opportunity to participate in a priced rally for minimum cost, with no 
additional risk to the corn farmer. 

   Here's an example: Say a farmer agrees to sell 30,000 bushels of corn on a 
Minimum Average Price contract that extends through August. With 28 trading 
days remaining, that means 1,071 bushels per day will be priced. The minimum 
value is set at $4.20 on December corn. Let's assume the cost is 5 cents per 
bushel. Each day the market settles above $4.20 futures, that 1,071 bushels is 
priced at the closing December price. Any day December closes under $4.20, that 
day is priced at $4.20. The simple average of the 28 separate pricings would 
then equal the final futures price for the 30,000 bushels. 

   Please note that this contract does not take into consideration basis. That 
is a separate risk to be managed, but basis can be set at any time or even 
ahead of time. 

   Such a contract offers a chance to capitalize on a potentially bullish 
August report, but also protects the downside in the event of a bearish 
surprise. Check with your local cash grain merchant to see if a similar 
contract might be offered in your area.

   Comments above are for educational purposes and are not meant to be specific 
trade recommendations. The buying and selling of grains and grain futures 
involve substantial risk and are not suitable for everyone. 

   Dana Mantini can be reached at dana.mantini@dtn.com 

   Follow Dana Mantini on Twitter @mantini_r 

    

******************************************************************************
2019 Spring Wheat Tour Preview: After Rough Spring, What Will Scouts See?

    The 2019 Wheat Quality Council Hard Red Spring and Durum Wheat Tour will 
begin and end in Fargo, North Dakota, with scouts gathering Monday, July 22, in 
the evening and then heading out to check fields July 23 through the morning of 
July 25. Similar to last year, day one will cover the southern half of North 
Dakota, southwestern Minnesota and northeast/north-central South Dakota. Day 
two will cover northwest and north-central North Dakota, with day three 
covering north-central/northeast North Dakota and northwest/west-central 
Minnesota.

   Dave Green, executive vice president of the Wheat Quality Council, told me 
that the tour route would remain mostly the same and that he has 62 scouts this 
year versus 56 in 2018. "I am expecting an above average crop," said Green. 

   According to the North Dakota Wheat Commission's (NDWC) crop progress 
comments for the week ended July 14, development of the crop remained behind 
normal in all states with the exception of Minnesota. In Minnesota, 96% of the 
crop was headed, slightly ahead of the average of 91% for mid-July. North 
Dakota was 79% headed, South Dakota 75% and Montana 60%. A recent stretch of 
high temperatures -- upper 80s to lower 90s -- helped accelerate crop maturity 
some, which should be reflected in the July 22 report and will likely be seen 
by tour scouts.

   I had a chance to speak with farmers and elevator managers in North Dakota, 
South Dakota and northwestern Minnesota the past week about their expectations 
for the new crop. 

   "I think when the tour gets rolling, they will find a little bit of 
everything. That is what I get from conversations with producers in North 
Dakota and Minnesota the past couple of weeks," said Tim Dufault who farms in 
Crookston, Minnesota, and is a board member on the Minnesota Wheat Research and 
Promotion Council.

   "In the northern tier of North Dakota counties and the northeast, it was dry 
this spring and early summer; dry enough to impact the wheat crop. The western 
half of North Dakota has generally had timely rains and that wheat looks good. 
Minnesota wheat areas started to get dry by the end of June and my region 
received a good soaking rain the first week of July. Our yields should be 
comparable to last year."

   An elevator manager in east-central North Dakota told me that the crop there 
is average and is not a bumper crop. He expects the tour to see some drowned 
out spots, and it is still too early to tell if scab will be an issue. Farmers 
in his area were faced with soft and wet fields, and it was a challenge to get 
spraying done, but most succeeded. He added that the wheat should be filling 
nicely with the rains lately.

   Keith Brandt, general manager of Plains, Grain and Agronomy in Enderlin, 
North Dakota, said, "Surprisingly, after how late this spring wheat crop was 
planted, April 23 through June 11, it looks very good. Granted, that very late 
planted wheat doesn't have as good of a stand, but the cooler weather in May 
and early June is what the wheat crop needed. It seems the majority of the 
wheat got sprayed with fungicide, so that should limit quality concerns."

   Brandt added that he estimates southeast North Dakota yields will be 60 to 
65 bushel per acre. "I think our proteins will average 14.0," added Brandt. "It 
will be close to Aug. 10 before we see some harvesting, with the harvest 
extending to mid-September. Everybody will be looking for storage because very 
little was forward contracted." Brandt added that it will take a stronger corn 
price to pull wheat prices higher.

   "I think we are going to have a very good spring wheat crop this year. We 
had a storm blow through July 19, so there is some lodging now, but it should 
bounce back for the most part," said Ryan Wagner, Wagner Farms, located near 
Roslyn, South Dakota. "Starting to see a little scab show up, which isn't 
surprising considering the amount of humidity we have had, but it's still too 
early to tell just how bad it will be. Between the corn, soybeans and spring 
wheat, the wheat has looked the best of the three all season. Stands are nice 
and even, we have had adequate moisture, and it hasn't been too hot yet. We are 
on the far southern edge of the tour footprint, but I'm guessing they will find 
above average yields."

   Tim Luken, manager of Oahe Grain in Onida, South Dakota, said, "Spring wheat 
looks out of this world, actually. I do know those that did not spray 
fungicides are going to have issues with scab. We are about a week away from 
cutting winter wheat, but scouts may run in to some custom combiners."

   Allan Klain, Turtle Lake, North Dakota, said, "In our area, timely rains 
have kept the crop going. The crop does look good, not super spectacular but 
above average. Leaf diseases are at a minimum and fusarium infestation seems to 
be minimal. About 30% was sprayed in the area. We received 2.8 inches of rain 
starting 10 days ago and that basically saved the wheat."

   Klain said that further south and east, more rain has fallen and there is a 
lot of spraying for fusarium (scab) in that area occurring. "We made the call 
not to spray, and it seems to be the right one. I saw my first durum field in 
the area this year, and the farmer shelved it due to likely discounts if 
harvested. A farmer on Twitter from southwest North Dakota said around Mott, 
North Dakota, it is a "fusarium hotspot." 

   I spoke to a durum buyer July 19, and he said he thinks we are going to see 
above average yields, "for sure in far southwest North Dakota." USDA has 
production at 58 million bushels, but he thinks it will be more around 63 
million bushels.

   He added that the "jury is still out" on quality, especially areas reporting 
scab and he also said some that farmers have told him there could be lower HVAC 
(hard and vitreous kernels of amber color) because of bigger yields and not 
enough nitrogen. 

   NDWC noted in their crop progress comments as of July 14 that the North 
Dakota durum crop showed a slight improvement in overall condition with a 
rating of 77% rated good to excellent, up from 74% the previous week. Crop 
development was behind with 75% headed versus 88% last year at this time.

   "Recent rains and stretches of high daytime humidity have raised the disease 
threats in many areas, especially as the majority of the crop has advanced to 
the heading stage. As with spring wheat, producers are monitoring the crop and 
applying fungicides to help manage disease levels," said NDWC.

   When I was on the hard red winter wheat tour in 2018, Green told scouts that 
the tour is the industry's "first look" at the crop. "We know between now and 
harvest that yields can change, but the tour is a good starting point. It gives 
us the first snapshot of the new crop wheat," said Green.

   At the end of the 2018 Wheat Quality Council Spring Wheat Tour, the final 
total of the 325 spring wheat fields surveyed averaged 41.1 bushels per acre 
(bpa). The 17 durum fields surveyed averaged 39.3 bpa. The USDA reported in the 
September 2018 Small Grains Summary that the 2018 spring wheat yield was at 
48.3 bpa and durum was at 39 bpa.

   Charles Wallace will be covering the tour for DTN this year and you can 
follow him on Twitter @agcommcharlie and don't forget to follow DTN/Progressive 
Farmer on Twitter @dtnpf for stories and updates on tour results as well.

   Here is link to information published by Ohio State University Extension on 
fusarium head blight, also referred to as scab: 
https://ohioline.osu.edu/factsheet/plpath-cer-06

   Here is a link to information published by North Dakota Stata University on 
vomitoxin, also referred to as DON: 
https://www.ag.ndsu.edu/publications/crops/plant-disease-management-deoxynivalen
ol-don-in-small-grains-1

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

   Follow her on Twitter @MaryCKenn

******************************************************************************

DTN offers additional daily information available free through DTN Snapshot – sign up today.
 
 
Copyright DTN. All rights reserved. Disclaimer.
Powered By DTN