Apr 20 2015

Texas Daily Ag Market News Summary 4/20/15 Posted 9 years 222 days ago by

• ·         Feeder cattle mostly steady; futures lower.
• ·         Fed cattle cash trade lower; formula trades lower; futures sharply lower; beef prices steady to lower.
• ·         Cotton steady to lower.
• ·         Grains and soybeans mostly higher.
• ·         Crude oil lower; natural gas lower.
• ·         Stock markets lower.

Texas feeder cattle auctions quoted prices mostly steady. Feeder cattle futures closed $2.80 lower at $213.00 per hundredweight (cwt). The Texas fed cattle cash trade closed $2.00 lower on Friday. Wholesale boxed beef values were mixed, with Choice grade closing $2.59 lower at $257.79 per cwt and Select grade on par with the previous day’s closing price of $250.97 per cwt. Estimated cattle harvest for the week totaled 533,000 head, up 31K from the previous week, but down 32K from a year ago. Year-to-date harvest is down 5.7%. Fed cattle futures closed $3.00 lower at $157.80 per cwt.

Cotton cash prices were on par with Thursday’s closing prices. Futures settled 0.72 cents lower at 63.29 cents per pound. Large U.S. supply continues to have a drag on prices.

Corn and grain sorghum prices were mixed, with corn cash and futures prices each $0.04 higher and grain sorghum cash prices up $0.24. Soybean futures were $0.03 higher, marking four straight sessions of higher closing prices.

Wheat cash and futures prices each closed $0.01 higher, with prices settling at $4.72 per bushel and $5.09 per bushel, respectively.

Stock markets closed lower as first-quarter U.S. earnings reports and Greek financial troubles caused investor trepidation. Crude oil prices closed $0.970 lower at $55.74 per barrel, marking the first day of lower closing prices since April 8^th.

 

Agri-Pulse: Washington Week Ahead:

WASHINGTON, April 19, 2015 - A deal between key lawmakers to fast-track new trade agreements begins to move through Congress this week, increasing pressure on President Obama to win over reluctant Democrats.

 

The Senate Finance Committee is expected to vote on a Trade Promotion Authority bill that would ensure Congress can't amend new trade agreements, only approve or reject them.

 

The TPA bill is to move in tandem with a second measure renewing Trade Adjustment Assistance (TAA) programs for workers, businesses and farmers harmed by imports. TAA was a priority for the Finance Committee's ranking Democrat, Ron Wyden of Oregon, who also won new TPA provisions that include public disclosure requirements for trade deals and set up a new method for lawmakers to strip an agreement of the fast-track process.

 

The administration would no doubt like to have the TPA bill out of committee and headed to the Senate floor when Japanese Prime Minister Shinzo Abe arrives in Washington for meetings with President Obama and delivery of an April 29 speech to a joint session of Congress.

 

Japan is believed to be waiting for assurance that the proposed 12-nation Trans-Pacific Partnership agreement will get fast-tracked through Congress before making critical concessions on its barriers to U.S. agricultural commodities and autos.

 

Getting TPA through the Senate will be difficult enough, but the margin in the House will likely be razor thin despite the concessions Wyden got.

 

“It's going to be tough,” especially in the House, the Senate Democratic whip, Richard Durbin, told Agri-Pulse in an OpenMic interview.

 

Durbin has estimated that only one-quarter of Democrats in the Senate will support TPA, and there are reports that fewer than 20 House Democrats will vote for it. “The bottom line is if there is just an up-or-down yes or no vote, many members of Congress, myself included, will feel that really isn't a fair process,” he said.

 

Labor unions and other anti-TPA groups plan a rally Monday against the legislation. Finance Chairman Orrin Hatch, R-Utah, initially resisted having another hearing on the legislation but relented and set a hearing Tuesday that will allow AFL-CIO Richard Trumka to testify against the measure. Thomas Donohue, president of the U.S. Chamber of Commerce, will be the only other witness.

 

Attack on WOTUS bill takes another step

 

The House Appropriations Committee is expected to meet Wednesday to mark up its fiscal 2016 Energy and Water bill, which includes a provision to block the Obama administration from enforcing a rule re-defining what streams, ditches, ponds and wetlands can be regulated under the Clean Water Act as “waters of the United States” (WOTUS).

 

The policy rider is part of a two-prong strategy congressional Republicans are using to address the WOTUS rule, which is now under final review at the Office of Management and Budget.

 

Last week, the House Transportation and Infrastructure Committee approved a separate bill (HR 1732) that would force the administration to withdraw the rule, but the measure drew only two Democratic votes and has little chance of becoming law.

 

Senate panel looks into Cuba trade prospects

 

The Senate Agriculture Committee holds a hearing Tuesday on the prospects for increased trade with Cuba as the administration attempts to normalize diplomatic relations and ease the half-century-old embargo. Michael Scuse, the Agriculture Department's undersecretary for farm and foreign agriculture services, will testify at the hearing along with officials from the Treasury and Commerce agencies that administer the embargo.

 

Cuban purchases of U.S. food and agricultural products have been on the decline for years and totaled just $38 million for January and February, down from $78.5 million during the first two months of 2014, according to the U.S.-Cuba Trade and Economic Council.

 

Texas A&M University economist C. Parr Rosson, who also will testify at the hearing, said the Cuban government once learned that it can't use purchases of U.S. farm commodities to win American political support and in the meantime has found other suppliers of commodities such as wheat, rice and beef.

 

“Part of this is political on the part of the Cuban government and part of it is a risk management tool to diversify away from the United States,” he said.

 

Rosson, who has assisted Texas companies in opening trade with Cuba, said he's optimistic that exports will turn around. But he said that significant increases will depend on, among other factors, improvements in the economy and the island's infrastructure. A lack of reliable cold storage, for example, makes it difficult to sell frozen and chilled products to Cuba.

 

Justices consider challenge to marketing order

 

The U.S. Supreme Court hears oral arguments Wednesday morning in a longstanding dispute over the federal marketing order system used to control supplies of many fruits and vegetables. The system requires excess commodities to be steered into “reserve pools.”

 

California raisin producer Marvin Horne, who also packs and stores raisins, argues that he should be exempt from the reserve-pool requirement if he packs and stores his own raisins, an assertion USDA disputes. The justices are being asked to decide whether USDA must pay “just compensation” for the taking of Horne's raisins.

 

This is the second time in two years that the court has gotten involved in the dispute. In 2013, the justices decided unanimously that federal courts had to hear the Hornes claim that the reserve requirement amounted to an unconstitutional “taking” of private property.

 

The Ninth U.S. Circuit of Appeals, which had originally ruled that the courts lacked jurisdiction to hear the takings claim in 2014 denied Horne's claim that the reserve requirement was unconstitutional, sending the case back to the high court.

 

Here's a list of agriculture- or rural-related events scheduled for this week in Washington and elsewhere:

 

Separately, a bill to provide the president with fast-track trade authority is widely expected to be released this week. Passage of a bipartisan Trade Promotion Authority bill is critical to wrapping up negotiations over the 12-nation Pacific Rim trade agreement and smoothing its eventual passage in the Congress.

 

Trade and appropriations are likely to be the top priorities for Congressional Republicans to complete this year.

 

Trade is the single issue where Republicans believe they can reach agreement with the president. Appropriations bills are critical because Republicans plan to add provisions to them to block a range of the administration's regulatory actions.

 

A House Appropriations subcommittee is scheduled Wednesday to vote on a fiscal 2016 spending bill for the Army Corps of Engineers that's likely to include a provision attacking the administration's proposed rule for re-defining the “waters of the United States” (WOTUS) regulated by the Clean Water Act.

 

Senate Majority Leader Mitch McConnell, R-Ky., told Agri-Pulse in an exclusive Open Mic interview that Republicans also will try to stop the administration's plan for reducing carbon emissions from electric utilities.

 

Such policy riders could provoke a veto fight with the White House, but McConnell said Republicans will try to avoid a confrontation that would lead to a government-wide shutdown. To that end, appropriations bills will be sent to the White House individually, rather than as a large package, he said. An impasse over an individual bill could shut down just a handful of agencies.

 

“If you pass individual appropriations bills, you don't have a government-wide shutdown,” McConnell said. “If the president vetoes a bill that temporarily shuts down the Environmental Protection Agency, I don't think that's a national calamity. It's an argument over what the bill ought to say.”  

EPA is funded through the Interior-Environment appropriations bill, which also provides spending for the Interior Department and the Forest Service. The Energy and Water bill funds the Energy Department as well as the Corps of Engineers.

 

For proof that Republicans have a good chance to stop some regulations via policy riders, McConnell cites past successes in rolling back Dodd-Frank regulations on the financial services industry. A provision slipped into the fiscal 2015 omnibus spending measure killed part of the Dodd-Frank law forcing big banks to spin off their derivatives business.

 

House Republicans also will move a separate, standalone bill to attempt to stop the WOTUS rule. The measure that the House Transportation and Infrastructure Committee will vote on Wednesday is expected to be similar to a bill (HR 5078) that the House passed last year, 262-152, which would have killed the rule. A standalone bill would give Republicans a chance to force Democrats to go on record on the issue, but the measure would be much easier for Obama to veto than an appropriations measure that is needed to keep government agencies operating.

 

The TPA bill, meanwhile, will provide an opportunity for bipartisan cooperation before the showdowns on spending later this year when the appropriations measures get to the White House. McConnell told Agri-Pulse that the bill would be released in the “very near future.” “Hopefully, that's something we can pass in the Senate in coming weeks,” he said.

 

The AFL-CIO has been ramping up lobbying against the legislation in conjunction with the bill's expected release. On Wednesday, union members will rally on Capitol Hill, and on Saturday, there are more than 50 events throughout the country.

Lawmakers are certain to be hearing a very different message Wednesday from 125 pork producers, members of the National Pork Producers Council, who will be in Washington for their a legislative conference.

 

A TPA bill sets congressional priorities for trade agreements and lays out the process for ratifying trade deals through a process that doesn't allow Congress to alter the details of the agreement. Late last week, congressional aides said the terms of the TPA bill were still under negotiation.

 

Also Wednesday, the Senate Foreign Relations Committee will hold an important hearing on overhauling international food aid. As reported in the Agri-Pulse weekly newsletter, Chairman Bob Corker, R-Tenn., is considering packaging a sweeping rewrite of Food for Peace along with authorizing the Obama administration's $1-billion-a-year Feed the Future agricultural development initiative.

 

Corker and Sen. Chris Coons, D-Del., this year re-introduced the Food for Peace Reform Act (S. 525), which would allow dollars to be used to purchase commodities overseas, not just from American producers. Their bill also would strike down a requirement, known as cargo preference, that at least half of Food for Peace commodities be shipped on U.S.-flag carriers.

 

The hearing comes as the Obama administration has been in negotiations with the shipping industry to maintain the current cargo preference requirement while also allowing substantial purchases of overseas aid commodities.

 

Corker told Agri-Pulse he blocked a Feed the Future authorization bill from becoming law late last year because he wanted to consider the issue in tandem with the far more controversial overhaul of Food for Peace.

 

Here's a list of agriculture- or rural-related events scheduled for this week in Washington and elsewhere:

Monday, April 20

All day - Food and Drug Law Institute annual conference, Grand Hyatt.

4 p.m. - USDA releases weekly Crop Progress report.

 

Tuesday, April 21

All day - National Food Policy Conference, sponsored by the Consumer Federation of America, Capital Hilton Hotel. Agriculture Secretary Tom Vilsack speaks at 3:15 p.m.

All day - FDLI conference.

10 a.m. - Senate Agriculture Committee hearing on agricultural trade with Cuba, 328A Russell.

10 a.m. - Senate Energy and Natural Resources Committee hearing on reauthorization of the Land and Water Conservation Fund, 366 Dirksen.

10 a.m. - Senate Finance Committee hearing on trade policy, 215 Dirksen.

3:10 p.m. - Deputy U.S. Trade Representative Robert Holleyman speaks to the American Association of Port Authorities spring conference, Mayflower Renaissance.

Wednesday, April 22

Morning - CFA's National Food Policy Conference.

U.S. Supreme Court hears oral arguments in Horne vs. U.S. Department of Agriculture.

10 a.m. - House Agriculture subcommittee hearing on reauthorization of the U.S. Grain Standards Act, 1300 Longworth.

1:30 p.m. - House Agriculture subcommittee hearing on reauthorization of the Livestock Mandatory Reporting Act, 1300 Longworth.

3 p.m. - House Ways and Means Committee hearing on trade policy, 1100 Longworth.

 

Thursday, April 23

8:30 a.m. - USDA releases Weekly Export Sales.

9 a.m. - House Natural Resources Committee hearing on wildfire management, 1324 Longworth.

4 p.m. - U.S. Trade Representative Michael Froman speaks at The Atlantic Economy Summit, Capital Hilton.

 

Friday, April 24

9 a.m. - USDA releases Food Price Outlook.

 

Daily Market Summary Data for 4/20/2015

 

If you are interested in receiving this daily report, please subscribe here.