USDA, Senators Vow to Change Farmer Cooperative Tax Provision
Agriculture trade groups and federal officials are working to change part of the new tax law that gives farmer cooperatives an edge over independently owned businesses.
The provision, added days before the tax bill was signed in December, was designed to make sure cooperatives benefit from a new deduction for pass-through businesses. But as written, it unintentionally created a significant advantage for farmers who sell grain to cooperatives and could allow some farmers to wipe out their taxable income.
U.S. Winter Wheat Planting Touches Century Low -- Update
U.S. wheat farmers planted the least acres of winter wheat in over a century, as enormous stockpiles of the grain remain in storage.
The U.S. Department of Agriculture on Friday estimated that farmers planted 32.6 million acres of winter wheat for 2018, slightly lower than 32.7 million acres planted the previous season. Though it was more acres than analysts expected, the current crop is still the smallest since 1909.
Many U.S. farmers have struggled to turn a profit from wheat in recent years. Low prices as well as growing supplies and production globally have pushed some farmers to switch to crops like soybeans and corn.
STORIES OF INTEREST:
Soybeans Set to Struggle in 2018 -- Market Talk
13:47 ET - US farmers are reaping what they sowed last year, and that's a lot of soybeans. Farmers in the Midwest planted more soybeans than ever in 2017, betting on the oilseeds to help keep them afloat during a multiyear slump in crop prices and incomes. Despite erratic weather, they raised a record crop. Now, USDA is forecasting domestic reserves will balloon to the largest in 11 years, and some analysts worry that figure could grow larger still. Prices for the oilseeds will "struggle to rally" amid growing export competition from Brazil, says Karl Setzer of MaxYield Cooperative, who adds that even a bump in demand from expanding US crush facilities may not chew through the nation's supply as much as needed. (firstname.lastname@example.org; @jessenewman13)
Russia, Brazil Pose More Export Trouble for US -- Market Talk
12:54 ET - The export picture isn't getting any brighter for key US row crops, as agricultural behemoths like Russia and Brazil pick up business in the world market. USDA boosted its projection for Russian wheat shipments this season by 1.5M tons to a record 35M thanks to growth in supplies there and bargain prices. The agency also raised its forecast for Brazilian soybean shipments, which it says are eating into US market share. USDA cut its estimate for US soybean exports by 65M tons, citing a slow pace of sales commitments last month and tougher competition from South America, which produced huge crops last year. (email@example.com; @jessenewman13)
Corn Lowers After USDA Boosts Harvest Projection -- Market Talk
12:14 ET - Corn futures tip to red after the USDA says farmers last autumn brought in a larger crop than analysts had anticipated, also delivering a bigger-than-expected estimate for supplies. The agency said the 2017 corn harvest totaled 14.604B bushels, which was higher than its November figure. That surprised analysts who had anticipated a slight decrease. The USDA's figure for domestic stockpiles added to negative sentiment in the market, as it projected inventories this season at 2.477B bushels, a bump from last month's projection. Analysts had also expected that figure to decline. CBOT March corn falls 0.5% to $3.47/bu. (firstname.lastname@example.org; @jessenewman13)
Livestock Futures Rise; Meat Supplies Grow in 2018
Livestock futures turned higher after a week punctuated by selloffs.
The hog market was rocked earlier this week by renewed tensions over the North American Free Trade Agreement, or Nafta, after Canada filed a complaint with the World Trade Organization over the Trump administration's use of tariffs.