The Russian invasion of Ukraine continues to have ripple effects through the ag sector.
The Kansas City May contract for hard red winter wheat closed at $10.03 after hitting the 50-cent trading limit for the day. Similarly, the Chicago Board of Trade May contract for corn settled Tuesday at a little over $7.25 after hitting its 35-cent trading limit.
It’s not just Ukrainian and Russian wheat and corn exports blocked from the global market, says Arlan Suderman, chief commodities economist for StoneX Group Inc. Grain from any country that uses Black Sea ports is being affected.
“Basically, with trade out of the Black Sea shut down, not many ships are willing to pay the insurance costs or the risks to go in to the (region),” said Suderman. “That’s also reducing wheat that’s moving out of Romania, Kazakhstan and other countries that export out of the Black Sea. Basically, a third of the world’s wheat exports are off limits.”
Take note: Ag Secretary Tom Vilsack told the National Farmers Union on Tuesday that USDA is watching the situation to determine whether the U.S. government will have to fill a gap in grain supplies.
If Ukraine’s exports are disrupted, “either because production doesn't take place or production does take place and it’s not capable of getting to market, then the world community has (a) set of issues that we'll have to deal with,” he said.
Biden goes after meatpackers, ocean carriers
President Biden used his State of the Union message Tuesday night to single out meatpackers and ocean carriers for blame when it comes to inflation. His attack on the four big packers, while familiar to anyone watching the administration over the past year, was not in the text of the speech provided by the White House.
“I’m a capitalist, but capitalism without competition isn’t capitalism,” Biden said.
For more on the speech as well as the agricultural impact of the Russian invasion, read the weekly Agri-Pulse newsletter. We also look at the sharp rise in crop insurance price guarantees that’s resulted from strong commodity markets.
Boozman: Senate shipping bill has ‘real teeth’
The Senate Ag Committee’s top Republican acknowledges that the Senate version of the Ocean Shipping Reform Act is “not as prescriptive” as the bill that passed the House in December. But Boozman tells Agri-Pulse the Senate version “has real teeth in it.”
In the business community, “everyone that I've talked to prefers the Senate bill,” Boozman said.
Keep in mind: The House bill specifically prohibits ocean carriers from refusing to carry U.S. ag commodities while the Senate version instructs the Federal Maritime Commission to come up with new rules on the issue a year after the legislation becomes law.
The ag sector has praised the Senate bill, but proponents are hopeful the House version is eventually enacted because of its tougher stance on ocean carriers.
Take note: The Senate Commerce, Science and Transportation Committee is having a hearing on the legislation Thursday.
Commodity groups face Qs about minorities, small farms
Farmers representing major commodity groups found themselves in an unfamiliar position at Tuesday’s House Ag Committee hearing: Several Democratic committee members pressed the groups on concerns that minority farmers are being left out of farm program benefits. The groups’ representatives were asked what are they doing about it.
Rep. Bobby Rush, D-Ill., was met with an awkward silence when he raised the issue. Eventually, Brad Doyle of the American Soybean Association said his group had reached out to a Black farmers’ group. “We would welcome any comment or input from minority growers associations,” he said.
Nicole Berg of the National Association of Wheat Growers said her group would welcome new states into the organization, and she noted that USDA has programs for beginning farmers and minority producers.
Rush’s response: “This is not a state by state issue. Being black is not a state issue.”
By the way: Several commodity groups say Congress needs to raise reference prices for the Price Loss Coverage but weren’t ready to make specific recommendations. We have more in this week’s newsletter.
A bouquet of flowers sat at the late Rep. Jim Hagedorn's place in the House Ag Committee hearing room Tuesday.
Advocates: States, cities need better process for labeling
FDA needs to make it easier for states and local governments to enact local rules for nutrition and menu labeling, the Center for Science in the Public Interest and Philadelphia Department of Public Health argue in a petition.
The Federal Food, Drug, and Cosmetic Act prohibits local labeling except for safety warnings, but does allow for exemptions.
“However, the exemption petition process is broken,” CSPI and Philadelphia say in a news release. They note FDA never responded to the city’s 2011 petition to allow calories, sodium, saturated fat, trans fat, and carbohydrates to be published on restaurant menus in the city.
“The current process is also biased in favor of the food industry … because the FDA gives no weight to state or local benefits when considering a local policy's impact on interstate commerce,” CSPI and Philadelphia said.
Farm groups challenge vehicle emission standards
Corn and soybean growers and ethanol manufacturers are suing to block EPA’s new greenhouse gas emission vehicle standards for cars and trucks.
Two petitions filed in the U.S. Court of Appeals for the D.C. Circuit argue that the agency’s analysis was flawed.
“EPA’s GHG calculations intentionally ignore the significant carbon emissions associated with the production and operation of electric vehicles, their batteries and other components while denying credit for the carbon reductions associated with using low-carbon liquid fuels,” the petitioners said in a statement.
He said it. “We've got to raise a loud voice and stop Russia from doing and continuing this evil work, killing women and children indiscriminately.” House Agriculture Committee Chairman David Scott, D-Ga., at Tuesday’s hearing on farm bill commodity programs.
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