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MN Wheat Weekly Wheatsource

MN Wheat Weekly Wheatsource

February 2, 2021
MN Wheat Weekly Update

National Association of Wheat Growers (NAWG) Update
(Josh Tonsager)

South Africa H-2A Issue

  • On January 25, President Biden issued a proclamation suspending certain persons’ entry into the United States from several countries, including South Africa. This is due to several variant strains of COVID-19 that have been detected in recent weeks and months. Of concern to agriculture is how the proclamation might impact H-2A guest workers who typically arrive in the coming weeks and months. Since the proclamation was made, NAWG heard from multiple states about how this proclamation could impact operations, and the issue was discussed on this month’s State Execs/Staff call on Wednesday. Fortunately, the State Department issued a clarifying travel notice last night, January 28, which outlined that H-2A and H-2B applicants from South Africa covered by the Presidential Proclamation made on January 25, 2021, could qualify for the National Interest Exemption. The exemption applies to individuals who already hold valid visas and applicants seeking visas. 
  • For additional background, this is a link to the January 25 proclamation and here is a link to the State Department’s January 28 announcement

USDA CFAP Reg Freeze 

Another issue of note from this week has been on FSA’s freeze of the January 19, 2021, CFAP regulation. A notice was issued this week following an announcement from the White House freezing pending federal regulation subject to further review. This is a common process for new incoming Administrations to review recent and pending regulatory actions. 

  • USDA will continue to accept new or modified CFAP applications. This would be relevant for farmers who had yield issues with CFAP resulting from RMA being unable to communicate yield data to FSA. The recent regulatory correction partially addressed that issue by changing the payment rate from 85% of the 2019 ARC-County benchmark yield to 100%. If that correction was applicable to you, you can still modify your CFAP application. This regulatory freeze will delay payment, though, until the review is complete. 
  • The CFAP 3 payment of $20/acre that was authorized in the December COVID relief package has not been implemented yet. As we’ve communicated out to the states earlier this month, former Undersecretary Bill Northey indicated to us that implementation would not happen until the new Administration was in place. We continue to engage USDA about the importance of moving forward as quickly as possible. 
  • In the coming days, USDA and the Biden Administration intend to take additional steps to bring relief and support to all parts of food and agriculture during the coronavirus pandemic, including by ensuring producers have access to the capital, risk management tools, disaster assistance, and other federal resources.” 

FSA also had this notice to their state offices this week that starts to provide some direction: https://www.fsa.usda.gov/Internet/FSA_Notice/cfap_14.pdf?utm_medium=email&utm_source=govdelivery

Family-owned farms account for 96% of U.S. farms, according to the Census of Agriculture Typology Report

Family farms comprise 96% of all U.S. farms, account for 87% of land in farms, and 82% of the value of all agricultural products sold, according to the 2017 Census of Agriculture Farm Typology report released today by the U.S. Department of Agriculture’s National Agricultural Statistics Service (NASS). Read more here.

US Wheat Associates, Weekly Price Report
(Claire Hutchins)

  • Broader strength in the grains complex following the news that China purchased 1.36 million metric tons (MMT) of U.S. corn on Jan. 26, and confirmation that the Russian government increased its wheat export tax, supported all wheat futures prices week-over-week. CBOT soft red winter (SRW) futures jumped 28 cents on the week to close at $6.63/bu. KCBT hard red winter (HRW) futures increased 25 cents to end at $6.38/bu. MGE hard red spring (HRS) futures added 21 cents to close at $6.34/bu. CBOT corn futures jumped 46 cents on the week to end at $5.47/bu. CBOT soybean futures gained 58 cents to close at $13.70.
  • View the most recent USW Commercial Sales report here.

Wheat Sales to China Seen Long-Term – The Western Producer – 01/29/2021

  • China’s massive 2020 wheat import program was not a flash in the pan, according to a senior American wheat industry executive. China is estimated to have bought 8.5 million tonnes of wheat last year, the highest volume in 25 years. It has rapidly become the world’s third largest importer behind Egypt and Indonesia. The surge had a lot more to do with a shift in agricultural policy than it did with market dynamics, said Dalton Henry, vice-president of policy with U.S. Wheat Associates.
    That is a good thing because it means there should be sustained strong demand from the Asian giant in years to come, he said. Henry said the increased demand stems from a World Trade Organization case that the United States launched in 2015 and won in mid-2019. The WTO panel found that China had not been properly administering its tariff rate quota (TRQ) program for wheat, corn and rice.
  • Read more.

Industry Updates
(MN Farm Bureau Federation IMPACT)

Governor Walz Budget Proposal

  • Last week, Governor Tim Walz announced his budget recommendations for the state’s next fiscal biennium. The $52.4 billion package represents the first phase of months’ long budget negotiations between the DFL-controlled House and the Republican-controlled Senate.
  • The proposal includes:
  • Addressing the state’s forecasted budget deficit by utilizing $1 billion from the state’s budget reserves, $217 million in unspent funds from the current budget cycle, and $130 million in borrowed dollars from the US Bank Stadium Reserve
  • $1.6 billion in new spending over the next two years
  • The new spending would derive from tax increases, including a 1.5% increase in the income tax for those who earn more than $1 million per year, a 1.5% increase to the capital gains tax, an increased tax on large corporations in the state, and a reinstatement of the estate tax exclusion at $2.7 million. The estate tax proposal would retain the agriculture exemption.
  • In the area of agriculture, new spending would mean an increase to the Minnesota Department of Agriculture’s budget. The Department outlined the agencies budget proposal to the House Agriculture and Food Finance and Policy committee on Tuesday. An estimated 3% increase to MDA’s budget would allow for a number of additional programming opportunities, including:
  • Additional funding for the MN Farm and Rural Help Line
  • One time funding for the Farm Link Program and MDA’s Farmland Access Teams
  • Continued funding for the noxious and invasive weed control efforts
  • Funding for additional livestock and meat processing opportunities
  • An increase to the biofuels infrastructure program and the bioincentive program

Broadband

  • Last week, the Minnesota House Industrial Education and Economic Development Finance and Policy Committee held a hearing on HF 14, a bill that would allocate $120 million for the Border-to-Border Broadband Grant Program, or $60 million per year. Rep. Rob Ecklund (DFL-Int’l Falls) presented the bill and noted that this level of funding has been recommended by the Governor’s Broadband Task Force to meet 2022 speed goals.
  • The Governor included a $50 million investment in the boarder-to-boarder broadband program in his recently released budget proposal.

California Clean Car Standards

  • On December 21, 2020, the MPCA published a Notice of Intent to Adopt Rule with a Hearing for the Clean Cars Minnesota rule in the State Register.
  • You can find the proposed rule and supplemental information at:pca.state.mn.us/air/clean-cars-mn-rulemaking.
  • The Minnesota Senate has held two hearings in the Environment and Transportation Committees to hear updates from MPCA. Minnesota Farm Bureau submitted written testimony to express our concerns. That letter can be found here.

This proposed rule is currently making its way through the rulemaking process and is now open for public comment. You can submit your questions, comments, and feedback to the administrative law judge (ALJ) assigned to this rulemaking by 4:30 p.m. on March 15, 2021. Comments can be submitted via this website.

Other Items of Interest

Register Now for Small Grain Workshops

  • The University of Minnesota Extension is holding a series of virtual small grain workshops in February to address successful small grain management. “Whether you’re a farmer or crop consultant already producing small grains or looking for another crop to add to the rotation, these workshops are for you,” says Jared Goplen, Extension Educator in Crops. “Workshops will be informal conversations around production agronomics, variety selection, and economics.” These workshops will be held over Zoom, so you can join these workshops from anywhere convenient for you, via computer, tablet, phone, or other mobile device. These workshops will be held in lieu of the in-person southern Minnesota small grain workshops in 2021. Workshops will focus on small grain production in southern Minnesota but are open and applicable to all small grain producers. Workshops are sponsored by the Minnesota Wheat Research and Promotion Council.
  • Registration is free, and will be required to access the virtual zoom link. Please register by visiting https://z.umn.edu/southern-small-grain or contact Jared Goplen at 320-589-1711 x2128 or gople007@umn.edu for more information.
  • Dates, Locations, and Times are as follows:
    • Monday, February 15 – 1:00 – 3:00 Southeastern Minnesota Focus
    • Wednesday, February 17 – 4:00 – 6:00 Southwestern Minnesota Focus
    • Friday, February 19 – 9:00 – 11:00 Central Minnesota Focus
  • Panelists will include Jochum Wiersma, University of Minnesota Extension Small Grain Specialist, Jared Goplen, University of Minnesota Extension Crops Educator, and Daniel Kaiser, University of Minnesota Extension Soil Fertility Specialist

Identifying Hybrid Barberry: 

  • The Minnesota Invasive Terrestrial Plants and Pests Center at the University of Minnesota has a new wheat pest project that may be of interest to you
  • This work will detect Berberis ×ottawensis, the hybrid of common barberry and Japanese barberry which can host cereal rust diseases that threaten wheat and small grain production. It will develop cost-effective molecular diagnostic tools to identify barberry hybrids across Minnesota. 
  • Learn more here. 

“Cereal Innovators” webinar series featuring Andrew Ross

  • Wednesday, February 10, 2021 – 9:30 am
  • Please join the Northern Crops Institute on Wednesday, February 10th at 9:30am (CST) for our “Cereal Innovators” webinar series! This interactive webinar series focuses on new and unique ways to use cereal grains. Topics throughout the series include new processes, useful information on milling and baking, equipment information, and uses for cereal grains grown in MN, MT ND, and SD. A new speaker will be featured each month.
  • This month will feature Andrew Ross, professor in the Crop and Soil Science Department at Oregon State University. Some of the topics Andrew will cover during this hour-long webinar include: WHY cereal and whole grains, WHAT cereal grains, the HOW of cereal grains: milling and other processes, the WHERE of cereal grains and more.
  • So, mark your calendars! You won’t want to miss this webinar! Registration for Andrew’s one-hour webinar can be found at the link below:

Register Here: Cereal Grains as Human Food: Opportunities and Threats | Andrew Ross | February 10th