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Mark's Market Talk

May 26, 2020

Last week was another oh hum week in the commodity markets. Local prices were down 2 cents for corn and 8 cents on beans. The Chinese failed to order any beans after a week of promising orders. Tension is building between the leaders of our 2 countries and once again the American farmers are taking another shot in the midsection, or maybe a little lower. We continue to see depressed prices at the farmgate while consumers are paying 10 to 20 percent more at the grocery stores. Last week’s cold storage report told the true story. Total red meat supplies were 1% lower than last month but up 5 percent from a year ago. Frozen beef supplies were down 2% from last month, but up 14% from last year. These numbers prove we do not have a meat supply issue, we have a distribution problem. For as good as this country is at farming and manufacturing, we still struggle with having the right supplies in the right place at the right time. Maybe some of this is on purpose as some of the people in charge of the supply chain have an interest in making prices higher for certain products. Slaughter levels are still a little behind, but we are improving almost daily. Box beef is finally losing value after reaching record prices that were almost double the old record. The huge profits are not going to the farmers or the retailer, the packer is carrying suitcases of money home every night. Maybe they would not deserve all the blame had they been struggling for months on end. The truth is the processors have been raking in record profits for a long time. That should not surprise anyone since 4 or 5 huge companies control 80% of the US livestock slaughter capacity. Farmers did get a shot of good news last Tuesday when the USDA released the rules and payment rates for the Coronavirus Food Assistance program. To see the full details, go to; farmers.gov/cfap. The main purpose of this program is to help those that lost value in their stored grain and owned livestock during this pandemic. Therefore, grain farmers who sold their 2019 grain at harvest or before January 15, 2020 will be left out. The FSA offices will begin receiving applications on May 26. It is advised you call your local office to get directions of how you can submit these applications. The offices remain closed to the public so it appears you may be able to do this electronically. The payment rates are attractive and this time the livestock and dairy industry are included. This money will not make anybody whole, but it will sure help pay some bills.       
 
Posted: 5/26/2020 1:11:11 PM by Rob Matherly | with 0 comments


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