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MN Wheat Weekly Wheatsource

MN Wheat Weekly Wheatsource

MN Wheat Weekly Update

USDA Weekly Crop Progress Report (MN)
Click Here for Full Report

  • Top Soil Moisture: 12% very short, 31% short, 53% adequate, & 4% surplus
  • Sub Soil Moisture: 6% very short, 37% short, 54% adequate, & 3% surplus

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

NAWG Participates in MAP/FMD Coalition Meetings

  • This past week, NAWG participated in several meetings with members of the House Appropriations Committee Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies. These meetings focused on continued investment in the Market Access Program (MAP) and the Foreign Market Development (FMD) Program through the appropriations process. These public-private partnership programs support American farmers and allow for expansion of export markets.

Food for Progress Program Award of U.S. Wheat to Sudan

  • Recently, the U.S. Department of Agriculture’s Foreign Agricultural Service announced a Food for Progress program award of 300,000 metric tons of U.S. hard red wheat to Sudan. Wheat grown in the United States remains a crucial component of our food aid programs, and this assistance will go a long way to help the Sudanese people. For more information about this award – which is valued at $120 million – and how the food aid programs function, check out this posting from U.S. Wheat Associates

USDA Releases Prospective Plantings, Grain Stocks Reports

  • Wheat planted area for 2021 is estimated at 46.4 million acres, up 5% from 2020. Grain stocks from wheat totaled 1.31 billion bushels, down 7% from a year ago. Read the news release here
  • MN down 3% (1.38 million acres) from 2020 acreage of 1.43 million acres (CV).   

USDA Announces 2021 Marketing Assistance Loan Rates

  • On March 31, 2021, U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) released the 2021 Marketing Assistance Loan rates for wheat, feed grains, oilseeds, rice, and pulse crops. The national loan rate for wheat is $3.38 per bushel. Read the rest of the release here. 

Biden Unveils Infrastructure Proposal in Pittsburgh 

  • President Biden released his $2 trillion American Jobs Plan investment in the nation’s roads, waterways, airports, electric grid, and broadband on Wednesday during a speech in Pittsburgh. The package will invest about 1% of the GDP per year over eight years. Under the proposal, all Americans would have access to high-speed internet broadband by the end of the decade. Biden’s plan would also modernize 20,000 miles of streets and highways out of the total of 173,000 miles Biden says are in poor condition, and address problems with some of the tens of thousands of bridges that need repairs. A second economic proposal focused on human infrastructure is expected in April. This infrastructure plan includes significant corporate tax provisions that NAWG is currently evaluating. NAWG continues to engage with Congressional offices on Capitol Hill about our infrastructure and tax policy positions.

US Wheat Associates, Weekly Price Report
Michael Anderson

USDA Predicts Decline in U.S. Spring Wheat Planted Area as Dryness Continues in the Northern Plains – Catherine Miller 

According to the March 31 USDA 2021 Prospective Plantings report, total U.S. total spring wheat planted area is expected to fall to 11.7 million acres (4.34 million hectares), down 4% from last year, if realized. This estimate includes 10.9 million acres (4.41 million hectares) of hard red spring (HRS), down 5% from last year and down 6% from the 5-year average. “We agree with USDA estimates that spring wheat acres will be down this year,” said one U.S.-based grain trader. READ MORE

  • All wheat futures prices fell on the week as crop condition ratings improved. CBOT soft red winter (SRW) futures fell 2 cents to close at $6.11/bu. KCBT hard red winter (HRW) futures lost 3 cents to end at $5.65/bu. MGE hard red spring (HRS) futures dropped 14 cents to close at $5.99/bu. CBOT corn futures gained 7 cents to end at $5.59/bu. CBOT soybean futures were up 2 cents to close at $14.02/bu 
  • Commercial Sales: This week’s U.S. wheat commercial sales of 250,000 metric tons (MT) were down 27% from last week’s 344,000 MT but within trade expectations of 125,000 MT to 450,000 MT. Year-to-date commercial sales for delivery in 2020/21 total 25.1 million metric tons (MMT), 1% higher than last year. USDA expects total 2020/21

U.S. Drought Monitor

Except for the Texas Panhandle and Colorado most wheat growing areas saw little or no rainfall for the week. The Plains states remained dry with strong winds, and drought conditions expanded across parts of the Dakotas. Dry conditions worsened in eastern Washington as well.

Industry Updates
MN Farm Bureau Federation IMPACT

AFBF Statement on Capital Gains and Stepped-Up Basis

  • American Farm Bureau Federation President Zippy Duvall commented on the recent proposals by several lawmakers to tax unrealized capital gains at death and roll back the stepped-up basis on those capital gains.
  • “Taxing capital gains when a loved one passes away would have a devastating impact on farm and ranch families, even more so if the stepped-up basis tool is taken out of the toolbox. Stepped-up basis encourages families to grow their businesses and pass them on to another generation, and elimination could force those families to sell their farms just to pay the taxes.
  • “The value of many farms is tied up in land and equipment. Cash flow on most farms is much too small to pay large capital gains taxes. These taxes would cause further consolidation in agriculture with small farms more likely to be forced out of business by the tax liability.
  • “I’m confident that’s not what Congress intends. AFBF urges lawmakers to discard these misguided proposals.”

PPP Application Extension

  • President Joe Biden signed the PPP Extension Act of 2021 into law this week, extending the Paycheck Protection Program an additional two months to May 31, and then providing an additional 30-day period for the SBA to process applications that are still pending

Is Carbon a Commodity?

A recent Market Intel update discusses how agricultural ecosystem credits could be priced and purchased, particularly if they were priced as a commodity. A challenge of agricultural ecosystem credit markets is quantifying the generated assets in a streamlined and cost-efficient manner. After that hurdle is overcome, the next question is how are these assets priced?