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ADM expands pet food business with Crosswind Industries

Jupiterimages/liquidlibrary dog treats

Archer Daniels Midland Co. (ADM) announced Jan. 10 that it has signed an agreement to acquire Crosswind Industries Inc., a Kansas-based producer of dry-expanded, dual-texture, semi-dry and semi-moist treat products for pets.

“The global pet food industry represents a strong opportunity for strategic growth, especially for a company with the global resources of ADM,” said Brent Fenton, president of ADM’s Animal Nutrition business. “ADM already sells more than 50 ingredients and commodities that are used by more than 70% of all pet food companies in North America. Now, we’re taking the next step with the addition of Crosswind Industries to our global network.

"With five production facilities and a wide range of successful products, Crosswind represents a strong opportunity to expand our capabilities and a great fit not just with the Animal Nutrition business but across ADM’s wider portfolio of ingredients, colors and flavors for pets," Fenton said. "We’re looking forward to combining Crosswind’s operations and products with our own to provide customers with an even broader array of products and services.”

Crosswind is a manufacturer of contract and private-label pet treats and foods as well as specialty ingredients. Its 300 employees operate five processing lines across five Kansas facilities, with nine “ready-for-retail” packaging lines.

“Since early 2015, we have announced or completed several organic growth and improvement projects for our Animal Nutrition business across the U.S. as well as overseas,” Fenton noted. “We’ve also been active on the (mergers and acquisitions) front, with the acquisition of Lyrco Nutrition and the creation of our Alliance Liquid Feeds joint venture. Now, with the addition of Crosswinds, we are continuing our efforts to grow our business so as to set the industry standard and ensure that we are continuing to meet growing customer needs for quality animal nutrition products.”

ADM anticipates closing the deal in the coming weeks.

ADM Animal Nutrition is a leading manufacturing, nutrition and marketing business offering a wide range of innovative products for the animal nutrition market. ADM Animal Nutrition also offers feed products, supplements, premixes, custom ingredient blends and specialty feed ingredients that enable customers to meet and optimize animal health and nutrition goals.

ADM is one of the world’s largest agricultural processors and food ingredient providers, with more than 32,300 employees serving customers in more than 160 countries.

Grasslands hold potential for increased food production

Craig Warton/iStock/Thinkstock beef cows rest on hill

Managing grazing on grasslands in a more efficient way could significantly increase global milk and meat production or free up land for other uses.

About 40% of natural grasslands worldwide have the potential to support increased livestock grazing, according to a new study published in the journal Global Change Biology. This translates into a potential increase of 5% in milk production and 4% in meat production compared to the year 2000, or it allows for 2.8 million sq. km of grassland area to be released from production.

In order to feed the world’s growing population, global food production will need to increase, but at the same time, food production systems can affect the environment and climate.

“Grasslands are generally regarded to play an important role in increasing food production to meet future food demand,” said Tamara Fetzel, a researcher at the Institute of Social Ecology at Alpen Adria University in Vienna, Austria. “To achieve this target in a sustainable manner, our study suggests that we should focus on making more efficient use of currently available land resources instead of converting land from other uses.”

How much livestock grasslands can support depends on a number of variables, including climatic, biological and socioeconomic factors such as management, storage systems and biomass conservation. In the new study, the researchers explored the global-scale effects of seasonal patterns of biomass supply on the potential dynamics of grass-based livestock systems.

Fetzel and her colleagues identified areas where additional biomass could potentially be extracted from the landscape by comparing the current level of grazing intensity to the maximum levels supported in periods of minimum biomass supply, such as winter or dry periods. The researchers also discussed numerous socioeconomic and ecological constraints related to unlocking this potential, such as a lack of infrastructure, market access or knowledge, finance and labor constraints or the impacts of drought, and potential negative trade-offs such as loss of biodiversity or soil degradation.

“Grassland productivity and intensification potential are some of the most uncertain parameters in global land use assessments and are often used to estimate ambitious (greenhouse gas) mitigation targets. Making estimates of potential maximum grazing intensity more realistic by considering seasonal constraints reveals a certain potential to increase grazing intensity in some places yet shows that the actual grassland area available for other purposes remains limited,” said International Institute for Applied Systems Analysis researcher Petr Havlík, a study co-author who advised Fetzel with Karl-Heinz Erb from the Institute of Social Ecology Vienna.

The abstract in Global Change Biology can be found at http://onlinelibrary.wiley.com/doi/10.1111/gcb.13591/abstract.

Trade-offs explored in algal biofuel systems

When growing algae in outdoor ponds as a next-generation biofuel, a naturally diverse mix of species will help reduce the chance of crop failure, according to a federally funded study by University of Michigan researchers.

Algae-derived bio-crude oil is being studied as a potential renewable energy alternative to fossil fuels. University of Michigan ecologist Bradley Cardinale and his colleagues found that growing multiple algal species in 180 aquarium-like tanks helped stabilize bio-crude production and made the system more reliable and efficient.

While the experiment was conducted indoors, its findings have relevance for outdoor cultivation, said Cardinale, co-author of a paper published online recently in the journal Environmental Science & Technology.

"These findings are important because one of our greatest challenges in making algal biofuel affordable is improving the efficiency of outdoor growth ponds and preventing crashes that ruin crops. Companies spend large amounts of money to repeatedly set up these ponds. If species diversity increases efficiency while also reducing the chance of a crash, then it reduces costs as well," said Cardinale, a professor at the university's School of Natural Resources & Environment and director of the Cooperative Institute for Limnology & Ecosystems Research.

Surprisingly, the researchers also found that growing a mix of algal species did not increase bio-crude production compared to species grown alone as monocultures. In fact, competition among species often caused mixtures to produce less bio-crude than each species did individually.

This finding contrasts with decades of ecological research showing that communities containing more diverse sets of plants and animals are, on average, more productive and more efficient at using resources. Because of this prior work, the University of Michigan algae researchers had hypothesized that a mix of algal species would be more productive than single species, but that was not the case.

"Our results suggest there is a fundamental trade-off when growing algal biofuel," said Anita Narwani, a former Michigan postdoctoral researcher in the School of Natural Resources & Environment and lead author of the study. "You can grow single-species cultures that produce high yields but have a high risk of crop failure, or you can use mixtures of species that produce lower yields but are much less likely to crash and are more sustainable through time."

The research was funded by a $2 million, four-year grant from the National Science Foundation. Awarded in July 2013, the grant paid for a two-part study to identify and test naturally diverse groups of green algae that can be grown together to create a high-yield, environmentally sustainable and cost-effective system to produce next-generation biofuels.

The first phase of the study involved growing various combinations of six North American lake algal species in 180 aquarium-like tanks at a laboratory in the School of Natural Resources & Environment. Each 10-liter (2.2 gal.) tank contained either one, two, four or six species of algae. Half of the tanks were maintained at a constant temperature of 71.6°F; the other half were assigned to a variable-temperature treatment to simulate outdoor conditions. The temperature fluctuated between 62.6°F and 80.6°F at weekly intervals.

The experiment lasted for seven weeks and showed that mixtures of algal species were, on average, more stable and reliable in the face of temperature fluctuations.

The second phase of the project involved field-testing the most promising algal species and species mixtures by growing them outdoors in 80 fiberglass cattle tanks at the university's E.S. George Reserve, a 1,300-acre biological station near Pinckney, Mich. That work was conducted in the summer of 2016, and the results are being analyzed now.

In both phases of the study, colleagues at the University of Michigan College of Engineering used a technique called hydrothermal liquefaction to measure the quantity and quality of the combustible oils, or bio-crude, produced by the various algal combinations. They are also comparing the ability of single and multi-species systems to reuse and recycle wastes for additional growth.

Limited fossil fuel supplies, growing global demand for energy and increasing atmospheric levels of heat-trapping carbon dioxide gas have recently brought algae-derived biofuels to the forefront of renewable energy research programs.

However, a number of hurdles must be overcome to make industrial-scale production of algal bio-crude oil feasible and economically competitive with fossil fuel-based crude oil. For instance, when grown in large outdoor ponds, algae suffer from crop instabilities due to variations in sunlight and temperature as well as disturbances from pests, diseases and other unwanted invaders.

CDC grant funds vector-borne disease center at Cornell

mosquito filled with blood

Managing mosquito-borne viruses, such as West Nile, Dengue, Zika and tick-borne Lyme disease, have been a challenge due to a lack of resources, knowledge and trained expertise.

To better understand, prevent and treat diseases passed from insects to people, the Cornell University-led Northeast Regional Center for Excellence in Vector Borne Diseases will launch later this month, following a $10 million grant from the Centers for Disease Control & Prevention (CDC).

The center will offer a new master's program and develop new courses for Cornell's master of public health degree to educate a cadre of vector biologists and public health practitioners. The center will also fund applied research while forging unique collaborations among academic institutions and public health organizations.

Cornell will serve as the hub for a team of medical entomologists, virologists, epidemiologists, ecologists, modelers and molecular biologists under the direction of entomology professor Laura Harrington. These experts come from Cornell's department of entomology, College of Veterinary Medicine, Cooperative Extension and Agricultural Experiment Station, along with the New York State Animal Health Diagnostic Laboratory, New York State Integrated Pest Management, New York State Department of Health, Connecticut Agricultural Experiment Station, Connecticut Department of Health and other universities such as Columbia and Fordham.

The Northeast Regional Center for Excellence in Vector Borne Diseases will partly focus on conducting applied research to better prevent, control, monitor, track and respond to vector-borne disease outbreaks such as Zika and Lyme.

"There is little funding that is allocated for very practical vector biology and vector-borne disease research," Harrington said. The center will explore whether currently used control strategies for vector insects are effective in the region, design new control practices and investigate fundamental insect vector ecology and patterns of disease transmission in the region to develop better risk prevention strategies.

The center will have six applied research areas, called clusters, that include: predicting current and future infection risks in the region; investigating mosquito trapping methods; novel vector/pathogen interactions; overwintering biology of vectors, including climate change-induced effects; controlling and managing vectors, and basic field biology of mosquito vectors.

Beginning in the fall of 2018, the center will offer a new master's degree in public health entomology through the Cornell College of Agriculture & Life Sciences. Several of the new courses developed for the program will also be available for students in the new master of public health program administered by Cornell's College of Veterinary Medicine.

"Our goal is to train the next generation to have the best possible knowledge and skills that they can apply to introduced threats or existing vector-borne disease threats," Harrington said.

The center will also offer a one-day "vector biology boot camp" intensive training for professionals and short summer courses, she said.

The program will integrate with the Cornell Institute of Host-Microbe Interactions & Disease, launching in early 2017 and run by entomology professor Brian Lazzaro.

CDC awarded four $10 million grants. The others went to the University of Florida, the University of Texas-Galveston and the University of Wisconsin-Madison, each of which will form its own Vector Borne Disease Regional Center for Excellence. The funding is part of $184 million CDC awarded to states, territories, local jurisdictions and universities to support efforts to fight Zika virus infection and related health outcomes, including microencephaly and other serious birth defects.

New study reveals negative implications of raising 'slower-growing' chickens

Credit: buhanovskiy/iStock/Thinkstock. broiler chickens

The topic of using "slower-growing" broiler chicken breeds in U.S. poultry production continues to gain momentum, but a study released this week by the National Chicken Council (NCC) details the environmental, economic and sustainability implications of raising slower-growing chickens, revealing a sharp increase in chicken prices and the use of environmental resources — including water, air, fuel and land.

As such, NCC is urging consumers, the foodservice and retail industries and non-governmental organizations to invest in studying the impact in the U.S. of the expanding market for slower-growing broiler chickens. Additionally, the group is calling for more research on the health impact of chickens' growth rates to ensure that the future of bird health and welfare is grounded in scientific, data-backed research.

"The National Chicken Council and its members remain committed to chicken welfare, continuous improvement and respecting consumer choice — including the growing market for a slower growing bird," said Dr. Ashley Peterson, NCC senior vice president of scientific and regulatory affairs. "However, these improvements must be dictated by science and data — not activists' emotional rhetoric — which is why we support further research on the topic of chicken welfare and growth rates."

Environmental implications

In assessing a transition to a slower-growing breed, the environmental impact is an important component often left out of the equation, NCC said. If only one-third of broiler chicken producers switched to a slower-growing breed, nearly 1.5 billion more birds would be needed annually to produce the same amount of meat currently produced — requiring a tremendous increase in water, land and fuel consumption. This would amount to:

  • Additional feed — It will take enough feed to fill 670,000 more tractor trailers on the road per year, using millions more gallons of fuel annually.
  • Additional land — An additional 7.6 million acres of land per year will be needed to grow the extra feed (corn and soybeans), amounting to roughly the size of the entire state of Maryland.
  • Additional manure output — Slower-growing chickens will also stay on the farm longer, producing an additional 28.5 billion lb. of manure annually. That's enough litter to create a pile on a football field that is 27 times higher than a typical football stadium.
  • Additional water — It will require an extra 5.1 billion gal. of drinking water per year for the chickens (excluding the additional irrigation water that would be required to grow the additional feed).

Economic implications

If the industry does not produce the additional 1.5 billion birds to meet current demand, the study found that the supply of chicken would be reduced significantly — equating to 27.5 billion fewer chicken meals per year.

The additional cost of even one-third of the industry switching to slower-growing birds would be $9 billion, which could have a notable financial impact on foodservice companies, retailers, restaurants and, ultimately, consumers. This will put a considerable percentage of the population at risk and increase food instability for those who can least afford to have changes in food prices, NCC said.

A reduction in the U.S. chicken supply would also result in a decreased supply to export internationally, and U.S. chicken is an important protein for families in Mexico, Cuba, Africa and 100 other countries.

NCC's commitment to chicken welfare, consumer choice

"Slower growing," as defined by the Global Animal Partnership, is equal to or less than 50 g of weight gained per chicken per day, averaged over the growth cycle, compared to current industry average for all birds of approximately 61 g per day. This means that, in order to reach the same market weight, the birds would need to stay on the farm significantly longer, NCC said.

“For decades, the chicken industry has evolved its products to meet ever-changing consumer preferences. Adapting and offering consumers more choices of what they want to eat has been the main catalyst of success for chicken producers.”

Peterson added, "We are the first ones to know that success should not come at the expense of the health and well-being of the birds. Without healthy chickens, our members would not be in business."

In fact, NCC said all current measurable data — livability, disease, condemnation, digestive and leg health — show that the national broiler flock is as healthy as it has ever been.

"We don't know if raising chickens slower than they are today would advance our progress on health and welfare, which is why NCC has expressed its support to the U.S. Poultry & Egg Assn. for research funding in this area," Peterson said. "What we do know is there are trade-offs and that it is important to take into consideration chicken welfare, sustainability and providing safe, affordable food for consumers. There may not be any measurable welfare benefits to the birds, despite these negative consequences. Research will help us identify if there are additional, unforeseen consequences of raising birds for longer."

In 2017, NCC will also be updating its Broiler Welfare Guidelines, last updated in 2014, and will have the guidelines certified by an independent third party. The guidelines will be updated with assistance from an academic advisory panel consisting of poultry welfare experts and veterinarians from across the U.S.

"NCC will continue to be in the business of providing and respecting consumer choice in the marketplace," Peterson concluded. "Whether it is traditionally raised chicken, slower-growing breeds, raised without antibiotics or organic, consumers have the ability to choose products that take into account many factors, including taste preference, personal values and affordability."

Study methodology

The study was conducted from August to September 2016 by Elanco Animal Health, in consultation with Express Markets Inc., using a simulation model that estimates the impact of slow-growing broilers on feed, land, water utilization, waste/manure generated and production cost. The model used average values of conventional versus slow-growing broilers for mortality, growout days, feed conversion, days of downtime and placement density. A full copy of the study is available here.  

Big jump seen in consumer meat purchases

USDA photo by Alice Welch steak meat case beef

Consumers should see ample supplies of their favorite meats in 2017. Brisk demand will keep prices from falling too much further, although producers of cattle and hogs have seen supply drive prices.

Those were major points made by Dr. Karl Skold, head of agricultural economics for JBS, at a workshop held during the American Farm Bureau Federation’s 2017 Annual Convention & IDEAg Trade Show in Phoenix, Ariz., this week. Skold said the historically unusual situation of expanding herds, growing supply and significant demand is driving an overall positive outlook for producers of beef and pork.

“Start with lower feed costs,” Skold said, adding that "the economy continues to improve. We are nearing full employment, and wages are picking up.” Skold said these trends are having an influence on how consumers are making meat choices.

“We are seeing a big jump in eating meat, but we are also seeing a shift to steaks,” Skold said. “We haven’t seen this big a jump in demand in a long time.”

This is encouraging news for cattle producers who have seen steep declines in cattle prices from record highs only a year ago.

The situation with pork is similar, Skold said, and pork had been profitable until a fourth-quarter drop last year. Per capita pork consumption has been stuck in the neighborhood of 50 lb. per person for some time. Pork also is more dependent on the export market.

Skold noted that per capita consumption for all meats, including chicken, is going up, tracking along with the lower prices, but beef is gaining favor again thanks to the ample supplies. The economist said a survey of retailers revealed that the last quarter of 2016 was the first time they had priced steak that low in six years.

“You go to the meat case and see $5.99 steaks, you’re going to buy them,” he said, whereas if those steaks hit $9.99/lb., consumers switch to chicken. However, Skold said, the prices are spurring significant increases in demand.

Skold said exports would be a huge factor in continuing the economic health of the livestock sector. There are what he called “headwinds,” starting with the U.S. dollar being strong against most other currencies. Other nations cannot buy as much U.S. meat with their own currencies.

Also, Skold said many of the gains in U.S per capita consumption have already been realized, so the industry may have to seek additional gains in the export market. “You have the population increasing at six-tenths or eight-tenths per year, (but) you get supply increasing 4%, 5% or 6%; you’re going to have to export it,” he explained.

Skold said consumers should see many opportunities to stock up on beef and pork as huge supplies will encourage demand. “Consumers have really returned and are eating more meat,” he said.

Phage therapy relies on precise cell destruction

Phage therapy, which exploits the ability of certain viruses called bacteriophages to infect and replicate within bacteria, shows promise for treating antibiotic-resistant bacterial infections.

However, the design of such therapies depends on a solid understanding of how phages do their work.

"Phages can kill the cell immediately, or they can become dormant and kill it later," University of Delaware assistant professor of electrical engineering Abhyudai Singh explained. "The data reveal a high level of precision in the kill time. It takes about one hour for the virus to complete the process, but questions remain about how the cells control this precision in timing."

Singh and John Dennehy from Queens College and the Graduate Center of City University of New York have collaborated on research to shed light on the molecular basis for this process.

Their findings appear in a paper, "A First-Passage Time Approach to Controlling Noise in the Timing of Intracellular Events," that was published online Jan. 9 in Proceedings of the National Academy of Sciences.

Singh and doctoral student Khem Raj Ghusinga provided the theoretical contribution, and Dennehy supplied the biological foundation for the work, which has important implications for medicine.

"The problem is that while there is an overall precision to this process, there is also inherent randomness from cell to cell," Singh said. "So, our mathematical model is basically a framework, or model system, that brings order to this randomness and provides general biological insights that can be applied in the laboratory."

He explained that proteins called holins are essential for lysing, or destroying, the cell. They accumulate on the cell membrane, reach a critical threshold and then form holes that rupture the cell and release phage "babies." However, the same gene that expresses holin also expresses another protein called antiholin.

"It's curious that nature would make two versions of a protein that cancel each other out," Singh said. "It turns out that it's actually antiholin that makes the timing precise. If we remove antiholin, the variation in the process increases."

Singh said the formulas developed in the work provided counterintuitive insights into the regulatory mechanisms needed for scheduling an event at a precise time with minimal fluctuations.

"While we expected feedback to be an important part of the triggering mechanism, it turns out that negative feedback regulation can actually amplify noise, or confusion, in event timing," he said. "So, in some cases, such as with our work on lysis in bacteriophages, precision in timing is obtained with no feedback at all."

"We believe that the analytical results and insights we obtained in this work have broader implications for timing phenomenon in chemical kinetics, ecological modeling and statistical physics," Singh said.

Cargill 2017 Q2 results bolstered by protein segment

Cargill company logo

Cargill, a global provider of food, agricultural, financial and industrial products and services, reported financial results for its fiscal 2017 second quarter and first half ended Nov. 30, 2016.

Key measures included:

  • Adjusted operating earnings rose 80% to $1.03 billion in the second quarter, compared with $574 million in the year-ago period. For the first half, earnings stood at $1.86 billion, up 57% over last year.
  • Net earnings for the quarter (on a U.S. generally accepted accounting principles basis) were $986 million, down 29% from $1.39 billion a year ago, when Cargill realized large gains from business divestitures, which are excluded from adjusted operating earnings. First-half net earnings were down 3% to $1.84 billion for the same reason.
  • Revenues were $26.9 billion and $54 billion for the quarter and half, respectively, each down 1% from last year.

"We are energized by the results across our businesses, which are due to the hard work and commitment of our teams worldwide," Cargill chairman and chief executive officer David MacLennan said. "Our increased profitability gives us confidence that we are achieving the broad-based structural improvements we have sought."

Segment results

The Animal Nutrition & Protein segment was the largest contributor to adjusted operating earnings in the second quarter, with results up notably from the prior year.

The North American protein group delivered strong performance across its product lines. Thanksgiving holiday demand boosted whole-bird sales in the turkey business, while a more normalized cattle supply, optimized production and healthy consumer demand contributed to a recovery in beef from last year's low. The egg business continued to see strong sales volume in foodservice.

The segment's global poultry group improved on last year's second quarter, led by good results in Asia. Second-quarter earnings in global animal nutrition were essentially even with last year due to a mix of largely offsetting factors around the globe.

During the quarter, Cargill announced a joint venture with So Good Food, a subsidiary of agri-food company Japfa, to make further-processed poultry products in Indonesia. In addition, Cargill broke ground on a facility in the Philippines with partner Jollibee Foods that will produce dressed and marinated chicken for Jollibee, a large Asian foodservice company. Further, it began an expansion of its poultry complex in northeast Thailand, which serves export markets around the world.

Earnings in Food Ingredients & Applications saw a solid rebound over last year's second quarter. The segment continued to strengthen its operational efficiencies across the board, achieving good gains in sweeteners and edible oils in most regions.

Cocoa and chocolate realized moderately better results as improved press margins in Europe helped make up for crop difficulties in West Africa that limited origination volume.

Increased production helped lift ethanol earnings in North America. Salt and deicing results dropped against the year-ago period as customers in North America carried over inventories of deicing products from last year's mild winter.

Origination & Processing earnings rose slightly against a strong comparative period, bolstered by performance in North America. This year's record U.S. corn and soybean crops were met with robust demand stemming from domestic and international growth in livestock production and reduced South American competition for exports. With the supply focus on North America, Cargill increased volumes across its U.S. and Canadian grain origination, oilseed crush and export facilities, with terminals on the U.S. Gulf and in Vancouver, B.C., running at capacity.

Industrial & Financial Services came back from a weak comparative period, with earnings boosted by trading results in more active markets for crude oil and refined products, natural gas and electric power, ocean transportation and iron ore. Returns from asset management also contributed to the segment's improved performance.

New products, investments

During the second quarter, Cargill said a number of new products and investments demonstrated its focus on innovation, such as:

  • The company launched iQuatic shrimp feed, designed for automated feeders that use acoustic technology to listen to when shrimp are eating and deliver just the right nutrients and quantities at the right time, resulting in larger, healthier shrimp and reduced waste.
  • Cargill employed proprietary technology and expertise in lipids to unveil its Lyveum brand of sustainable, high-performance personal care ingredients made from vegetable oils, which can replace mineral, synthetic or animal-derived ingredients in moisturizers, shampoos and many other products.
  • Cargill celebrated the openings of new innovation centers in Plymouth, Minn.; Colaco, Chile, and Shanghai, China, and now operates about 25 innovation centers and technology application facilities around the world.
  • Cargill and Calysta, a Menlo Park, Cal.-based technology firm, along with several institutional investors, announced plans to build a large gas fermentation facility in Memphis, Tenn. When it comes on line in late 2018, the facility will use a proprietary process to make FeedKind protein, a family of sustainable feed ingredients for fish, livestock and pets. FeedKind is initially being targeted as a replacement for fish meal in aquaculture feed to take stress off of marine ecosystems.

"We aim to be the most trusted partner in food, agriculture and nutrition by delivering sustainable solutions that help our customers nourish the world," MacLennan said. "We're bringing together the best talent and top-notch facilities to push the boundaries of what seems possible."

Cargill, with 150 years of experience, has 150,000 employees in 70 countries who are committed to feeding the world in a responsible way, reducing environmental impact and improving their communities.

GRAIN MARKETS: Soybeans higher again, near one-week high

market

Soybeans closed higher for a second day and are near a one-week high as traders await Thursday’s U.S. Department of Agriculture crop report, which is expected to add some bushels to the 2016 crop forecast.

Corn and winter wheat were mostly lower in light trading as traders there also await Thursday’s report. Winter wheat plantings on Thursday could be the lowest in about 100 years.

The dollar rose today, but remained near the low-end of a two-week trading range. Equities were mixed, with the Dow Jones industrials down about 7 points when the crops closed.

 

Exports – USDA, Reuters:

- Taiwan bought 5.12 million bu. of 2016 corn and unknown destinations bought 9.5 million bu. The deal to unknown destinations included 3.6 million of 2016 corn and 5.9 million of 2017.

- Japan seeks to buy 162,777 metric tons of wheat from the United States and Canada. From the U.S., it seeks 45,925 mt of western white, 14,140 mt of hard red winter and 46,711 mt of dark northern spring. The U.S. wheat is for loading Feb. 21-March 20. Results are expected on Thursday.

- Morocco seeks to buy 363,636 mt of U.S soft wheat and a similar amount of European Union soft wheat. It also seeks to buy 327,273 mt of U.S. durum. The deadline for the U.S. wheat is Jan. 17, with the soft wheat for arrival by April 30 and the durum by Dec. 31.

- Ethiopia seeks to buy 720,000 mt of optional-origin milling wheat, with offers due by Feb. 3. Shipment will be within three months of when letters of credit are opened, which could be March to May.

 

Corn closed a little lower but the March contract remains above several key moving averages and within the narrow trading range of the past week.

The export sales to Taiwan and unknown destinations were supportive and followed Monday’s better-than-expected export inspections.

Thursday’s report is awaited. Participants in trade surveys expect corn ending stocks to be lowered, Argentina’s corn crop trimmed and Brazil’s crop raised.  The Farm Futures survey released last week expects a 2016 corn crop of 15.05 billion bu., down about 176 million from USDA’s current estimate.

The dollar-value of corn at China’s Dalian market  for January was lower at $5.43/bu. European corn for March was weak at about $4.54. The prices reflect conversions from local currencies and metric tons.

CBOT estimated Tuesday’s corn volume at 202,817 compared with Monday’s actual volume of 299,218. Open interest on Monday decreased by 4,734 with March’s down 4,734 and May’s up 5,966.

March corn closed down 1.75 cents at $3.5825/bu. and May corn was down 1.75 cents at $3.6525.

What to Look For:  Trade surveys show USDA may raise Brazil’s corn crop. Rain showers have been frequent in Brazil crop areas, where the larger safrinha corn crop will be planted next month after early soybeans are harvested.

 

Soybeans finished higher, with the actively traded March above the 100- and 200-day moving averages and near the highs set last week.

The Farm Futures survey expects U.S. 2016 soybean production in the USDA report at 4.365 billion bu., up about 4 million from USDA’s current estimate. Participants in wire surveys expect lower soybean ending stocks, a slight reduction in Argentina’s crop and an increase in Brazil’s.

Crop news has been light with attention still on South America as reports continue to circulate of excess rain in parts of Argentina’s Cordoba and Santa Fe provinces. A forecast shows lighter rain amounts next week and wire reports quote local forecasters expecting drier conditions going into the weekend.

More deliveries were posted against the CBOT January contracts including 465 soybeans, 198 soybean meal and 329 soyoil contracts.

U.S. soybean oil for January closed up 0.16 at 35.43 cents/lb. Malaysian palm oil futures were lower with January at the equivalent of 32.65 cents/lb. China’s soybeans at the Dalian market closed at the equivalent of $17.06/bu. for January delivery.

CBOT estimated Tuesday’s volume at 147,202 compared with Monday’s actual of 154,516. On Monday, open interest decreased by 2,663 contracts, with January’s down 520 and March’s down 5,350.

January soybeans closed up 9 cents at $10.055/bu. and March up 8.5 cents at $10.1375. New-crop November rose 6.25 cents to $10.00.

What to Look For – Brazil’s soybean harvest is under way and dry weather is needed. Light to moderate showers are forecast there this week and next week.

  

Winter wheat closed mostly lower after forecasts put beneficial rain and mild weather in the winter wheat areas of the central and southern Plains next week.

Spring wheat was narrowly mixed with March a little higher and deferred months mixed.

Winter wheat acreage in Thursday’s report is expected to be down from a year ago and possibly the lowest is about 100 years. Poor returns have had farmers shifting fields to other crops.

The Farm Futures survey expects winter wheat seedings at 34.8 million acres, which would be the lowest since 1913.

CBOT estimated Tuesday’s soft red winter wheat’s volume at 105,471 compared with Monday’s actual of 116,380. Open interest in Monday’s market increased by 3,022, with March’s down 2,132 and May’s up 864.

Chicago’s March soft red winter wheat closed down a half-cent at $4.2675/bu. and May down a quarter-cent at $4.3975. Kansas City’s March hard red winter slipped a quarter-cent to $4.3825 and May eased a quarter-cent to $4.50. Spring wheat for March was up 1.5 cents at $5.6125 while May dropped 1.5 cents to $5.52.

What to Look For – Thursday’s crop report is the main event this week. Trade surveys expect USDA to increase 2016-17 wheat ending stocks.

LIVESTOCK MARKETS: U.S. egg industry to help ease egg shortage in South Korea

eggs in carton

South Korea's poultry and egg industry continues to grapple with the devastation caused by highly pathogenic avian influenza (HPAI) and announced this week that it has made a deal with the U.S. to import shell eggs.

A U.S. Department of Agriculture spokesperson told Feedstuffs that USDA's Foreign Agricultural Service (FAS), with input from the Agricultural Marketing Service (AMS), Animal & Plant Health Inspection Service and Food & Drug Administration, completed discussions related to the export of shell eggs (table eggs) to the Republic of Korea (ROK) but said liquid eggs are still under negotiation.

“Instructions for certification procedures have been distributed to field personnel for immediate implementation,” USDA said. “It should be noted that any company that desires to export these commodities to the ROK must first complete the application process for registered foreign establishments doing business with companies in ROK.”

The additional documentation is the responsibility of the exporter and will not be verified by AMS at the time of certification but must be approved by ROK prior to application for entry, USDA added.

“As the Republic of Korea battles its worst outbreak of highly pathogenic avian influenza in its history, the situation is not unlike it was for the U.S. poultry and egg industry in 2015, which also experienced its worst HPAI event ever,” the USA Poultry & Egg Export Council (USAPEEC) told Feedstuffs. “In Korea's case, its egg industry has been hardest hit, with up to 30% of its total flock of egg-laying hens culled in an attempt to stop the outbreak.”

USAPEEC said the U.S. egg industry was also hard hit in 2015, but so was the turkey industry. “Korea does not have appreciable domestic turkey production, however, so its egg industry is bearing the brunt of the outbreak, which has created a huge shortage of fresh table eggs.”

Because the U.S. had never exported table eggs to Korea, USAPPEC said the two governments had to quickly work out the technical and veterinary issues to enable ROK's import of U.S. eggs.

“Thanks to the quick work of the USDA Agricultural Marketing Service and the Foreign Agricultural Service, the U.S. and Korean governments were able to hammer out all these issues in a matter of a couple of weeks to allow AMS to issue the necessary export certificates,” the council said.

While some forms of U.S. processed egg products (mainly dried) were approved for export to ROK, other forms were ineligible, such as some liquid products, USAPEEC explained, adding, “The two governments also worked out agreements to allow those products to be exported, which will help with shortages of these products that have affected Korean food manufacturers.”

Shortages of some processed egg products also occurred during the HPAI incident in the U.S. in 2015. This forced some U.S. food manufacturers to turn to egg substitutes to make certain formulations of their products — with less-than-satisfactory results. “As soon as supplies were available, the food makers returned to eggs," USAPEEC said. "We suspect the same would hold true for Korea, and its food processors can quickly source U.S. products, which is a much better option than reformulating their recipes.”

As Korea is now experiencing an egg deficit, USPEEC said the U.S. industry finds itself with a surplus of eggs as a result of its efforts to re-establish layer populations that were decimated by HPAI in 2015.

“Because of the improving trade policy relationship with Korea, our industry is pleased to be in a position to support Korea with shipments of table eggs and egg products. We're hopeful that egg consumption in Korea does not decline appreciably because of its avian influenza situation,” the council said.