In The News Week – February 18, 2021
Editorial
As we all enjoyed the 3-day holiday weekend, let’s not forget we were not only celebrating a day for love and friendship but a celebration to honor the lives of all U.S. presidents. Presidents Day, first celebrated as a federal holiday in the 1880’s, is officially Washington’s Birthday and is popularly recognized as honoring George Washington and Abraham Lincoln. To celebrate this day, President Biden stated, “Today we celebrate Presidents Day, but the American story isn’t a story of presidents, it’s a story of the American people”. He acknowledged the work ahead of us, but stated “if we do it together, as one nation, we will not fail.” The American story is indeed a story of its people. It is people, especially those in agriculture and health care, who have worked without fail during a global pandemic that should also be celebrated on this holiday weekend.
Financial and economic plans are emerging from the Biden-Harris administration and many are waiting to see what direction these new policies will take us. The focus of the new administration on vaccination will hopefully begin to reduce the impact the pandemic has had on the economy. Legislators have been applauded for moving forward with plans that are creating new opportunities for corn-based ethanol. The new administration will also most likely increase regulation of the poultry industry’s response to COVID-19. Although even without requiring it, the egg and poultry industry created response plans and proactively trained their employees. This is only further evidence of how the dedication and hard work of the American people shapes this great nation.
The agricultural industry has been and should continue to be praised for how it efficiently navigated through the challenges of 2020 and continues to into 2021. Many industries within agriculture have been through a roller coaster ride because of the global pandemic. Some needing to completely pivot the way they do business, some seeing out of the ordinary growth, and others only making slight adjustments to ride through what might be the “new normal” for years to come. Some of these changes actually might be positive ones, new safety regulations for workers, new “virtual brands” for the foodservice industry, and more flexible work from home policies to name a few. I hope this past holiday weekend was spent focusing on the positives and not so much on the negatives. Valentine’s day is a day to celebrate those we love and care for and Presidents Day is a day not only to honor the nations presidents, but its people as well. Having a 3-day weekend to celebrate both days is a positive I definitely focused on!
Monica Lizar
Account Manager
Aeros, a Cultura Company
Feed and Grains:
COMMODITY REPORT
WEEKLY COMMODITY REPORT: FEBRUARY 5th 2021.
- The financial and economic policies of the Biden-Harris Administration are emerging with a focus on the vaccination campaign to reduce the impact of the COVID-19 pandemic on health and the economy. The commodity market this past week was little changed compared with the sharp upturn last week despite export orders and an anticipation of lower ending stocks.
- The direction of agricultural and trade policy to be implemented in 2021 will emerge with the confirmation of Tom Vilsack as USDA Secretary, Michael Regan as the Administrator of the EPA and Katharine Tai as U.S. Trade Representative, together with other Cabinet appointments and their subordinates relevant to agriculture.
- U.S. producers are now receiving and conversely livestock producers in the Midwest are paying close to $5.50 per bushel for corn and $13.70 per bushel for soybeans plus transport and basis.
- Corn and soybeans were respectively 0.2 percent and <0.1 percent above the previous week although still at notably high levels. Soybean meal gained 0.2 percent, consistent with the static price of soybeans.
- According to the USDA FAS Export Report for the week ending January 28th 2021 reflecting market year 2020-2021, cumulative export orders for corn amounted to 36.09 million metric tons (1,421 million bushels) with 20.02 million metric tons (788 million bushels) actually shipped. During the past week 3.02 million metric tons (118 million bushels) of corn were ordered by China and other nations.
- Cumulative export orders for soybeans for the 2020-2021 market year attained 11.12 million metric tons (408 million bushels) with 47.53 million metric tons (1,744 million bushels) actually shipped. This past week some previously placed orders from China were cancelled. During the week, orders for soybeans to all destinations attained 0.523 million metric tons (19.2 million bushels)
Read full article here
Markets Now with Tyne Morgan: Here’s Why Corn Prices Still Have Room to Climb
While volatility seems to be a vibrant theme in today’s markets, both corn and soybean prices have failed to make new highs. The March corn contract is only 10 cents off its highs, but March soybeans are trading nearly 60 cents below its high hit in mid-January.
Read full article here
Ethanol:
U.S. wins case against ethanol duties in Peru
The Peruvian National Institute for the Defense of Free Competition and the Protection of Intellectual Property Tribunal announced Friday that the U.S. ethanol industry and the U.S. government won an appeal on a countervailing duty case brought against U.S. ethanol in Peru, reversing a previous decision handed down by Peruvian authorities that applied a 15-cent per gallon duty on U.S. ethanol and resulted in loss of market access in the country.
The Renewable Fuels Association, U.S. Grains Council and Growth Energy participated extensively in this case, arguing at hearings in both the initial investigation and the appeal in Peru on behalf of the U.S. ethanol industry.
Read full article here
Legislators look to expand availability of higher biofuel blends
Iowa Gov. Kim Reynolds has introduced a bill to set a minimum standard of biofuels in the Iowa fuel supply. Meanwhile, legislators at the national level are also working to streamline regulatory requirements for higher ethanol blends.
In Iowa, HSB 185 proposed by Reynolds, creates more opportunities and markets within Iowa for corn-based ethanol including significant funding for biofuels infrastructure, as well as an E10 standard. The bill introduced in the Iowa state legislature would move the state to overall higher biofuel blends, including offering E15 statewide by 2025 and updating the E15 promotion tax credit to $0.03 per gallon year-round. It is estimated that over the first five years, the legislation would increase ethanol demand by over 117 million gallons.
POET, the nation’s largest ethanol producer, also applauded the legislation and POET Founder and CEO Jeff Broin says passing the legislation for an E15 standard could lay the foundation for the entire nation.
Read full article here
Eggs:
Egg Week – USDA Weekly Egg Price and Inventory Report, February 11, 2021.
- Shell inventory was up by 5.4 percent after a 5.9 percent increase last week. This confirms a move away from balance between demand and supply with implications for prices extending through the remainder of February, given the reality that the retail pipeline is full and with molted hens returning to production. Prices stabilized this past week but will fall in response to oversupply as inventory has increased by eleven percent over two weeks. There is little evidence of a return in the food service sector as liquid and dried-egg prices are stable and reopening of the economy is delayed by a surge in COVID-19 incidence rates in many regions suggesting more restrictions.
- The U.S. flock in production was up 0.2 million from the week of February 2nd 2021 to 316.6 million, with about 3 million molted hens resuming production within weeks.
- The USDA average Midwest benchmark generic prices for Extra-large and Large sizes were up 0.8 percent from the previous week to 127.5 and 125.5 cents per dozen. Mediums were down 5.0 percent to an average of 94.5 cents per dozen. During the past four weeks Midwest prices have been higher, tracking the three-year average, following three previous weeks of lagging both the corresponding weeks in 2019 and the 3-year average. The price increases over the past four weeks reflect increased demand with a moderate decrease in the U.S. flock in production.
- The Midwest price of breaking stock was up 1.3 percent to an average of 40.0 cents per dozen. Checks in the Midwest were unchanged at an average of 32.5 cents per dozen.
Read full article here
2021 survey: Cage-free conversions slowing down Egg producers share predictions for pace of US egg industry conversion to cage-free housing as well as their own plans for 2030.
The total number of table egg laying hens housed in the U.S. declined in 2020 according to the U.S. Department of Agriculture (USDA). The December 22, 2020, USDA Chicken and Eggs report estimated that the U.S. had 325.2 million table egg laying hens housed on December 1, 2020. This represents a 4.6% decrease from the same date in 2019.
The December 7, 2020, USDA Cage-Free Shell Egg Report estimates that on December 1, 2020, the total U.S. cage-free layer flock had 80.1 million hens, a 9.3 million-head increase from the same date in 2019. Nearly one-quarter, 24.6%, of the U.S. layer flock was estimated to be housed cage free on December 1. The rate of conversion of the U.S. layer flock to cage-free housing slowed in 2020: 9.3 million head of cage-free hens were added from December 1, 2019, to December 1, 2020, while 13.9 million head of cage-free hens were added from December 1, 2018 to December 1, 2019.
Read full article here
Poultry:
Preparing a national safety standard for COVID-19
New leadership in Washington will likely lead to increased regulation of the poultry industry’s response to COVID-19. The COVID-19 pandemic dramatically affected the global workplace. As a vitally important critical infrastructure industry – and without a regulation requiring or instructing it – the poultry and egg industries proactively developed infectious disease preparedness and response plans and trained employees.
Following this initial response, the poultry and egg industries continue to work closely with the U.S Department of Labor’s Occupational Safety & Health Administration (OSHA) and the U.S. Centers for Disease Control and Prevention (CDC) to develop and follow interim guidelines during the pandemic.
A national standard? A year after the onset of the pandemic, the move to establish state and national standards is underway. State Plan OSHA states, such as Virginia, Oregon, Michigan and California, have enacted state-based emergency temporary standards for COVID-19. Virginia is now in the process of adopting a permanent standard for infectious diseases.
With a new president in place, the development of a National Emergency Temporary Standard (ETS) is all but inevitable. An ETS may include standards modeled from Virginia and California’s ETS. This would require employer-funded COVID-19 testing during work hours, mandate paid leave and require additional companies to adhere to OSHA’s respiratory protection standard. A national ETS will surely address continued funding and distribution of personal protective equipment.
Read full article here
Ingredient Selection for Broiler Feed By Suttisak Boonyoung, Ph.D., Nutritionist, Cobb Asia-Pacific
Broiler feed accounts for approximately 70% of broiler production, and ingredients are the major contributor. Ingredients play important roles in pellet quality and broiler performance. In general, ingredient selection often uses commercial parameters including price and supply. However, quality parameters are also important. This article aims to provide the general aspects of ingredient selection for commercial broiler feed.
Nutrition aspects: Nutrient values are important for nutritionists in terms of ingredient selection. Typically, the focus is on incoming ingredients composition in terms of factors including moisture, crude protein, fat, fiber, and ash. However, we cannot consider only amounts when selecting ingredients. Instead, nutrient bioavailability including metabolizable energy, digestible amino acids, fatty acids, available phosphorus, and other nutrient values should be considered. Many references can be used as the guideline values (Institut National de la Recherche Agronomique [INRA], Brazilian Tables for Poultry and Swine).
The nutrient matrix is very important for feed formulation. The precision and accuracy of the analyses will consequently affect the structure, cost, and chemical composition of the feed. The nutrient matrix of each ingredient can be influenced by season, source, and storage time. For example, the starch content in cassava is lost during storage. The longer the storage time, the more cassava starch and energy will be lost. Therefore, nutrient matrices of each ingredient must be frequently evaluated and separated by sources.
Read full article here
Turkey:
NTF chair praises ways turkey industry navigated COVID-19
When the National Turkey Federation (NTF) adjourned its annual meeting one year ago, its members didn’t realize the challenges the industry would face in the coming year because of the COVID-19 pandemic.
Speaking during the NTF Virtual Annual Convention on February 9, Ron Kardel, 2020 NTF chairman and vice chairman of the board for West Liberty Foods, praised the way the organization’s membership quickly acted to navigate the challenges brought on by the pandemic in 2020 and into 2021.
“It’s you, the men and women of the turkey industry who have been working over the past year to keep our businesses afloat, our turkeys healthy and meat cases and refrigerators stocked with protein,” said Kardel. “My time as chairman has been very unusual, but it’s been rewarding to see NTF members come together to tackle the challenges the past year has brought.”
Read full article here
VIDEO: Reviewing COVID-19’s impact on turkey in 2020
The COVID-19 pandemic added to the U.S. turkey industry’s woes in 2020.
In a WATT Poultry Chat interview, Dr. Thomas Elam, president of FarmEcon LLC, reviewed performance metrics from 2020. He examined how the pandemic’s impact on foodservice demand and reduction of holiday gatherings slowed down turkey in 2020 and provided an early forecast for 2021.
Read full article here
Pork:
USDA: ‘Promising’ ASF vaccine development continues
The U.S. Department of Agriculture (USDA) says it has an African swine fever (ASF) vaccine candidate that is “promising” and “highly effective.” USDA Agricultural Research Service (ARS) Administrator Chavonda Jacobs-Young said research is underway on a potentially effective vaccine.
“Our animal research scientists have been able to identify a promising, highly effective vaccine candidate that protects against African swine fever,” she said. “This is big because it’s the first vaccine candidate that has shown some characteristics that we’ve not seen in others. The efficacy rate, for example, is one that has been very exciting.”
While ASF has never been detected in the U.S., it has devastated the swine industry in countries across Asia, Europe and Africa. The disease does not affect humans but is nearly 100% fatal in pigs and wild boar. “African swine fever has been in the news cycle and it is a devastating disease that impacts the pork industry. Thus far, it has been terribly impactful in Europe and in Asia,” Jacobs-Young said.
USDA has teamed up with commercial partners to conduct further research on the vaccine candidate. “We have a wonderful public-private partnership, so our latest vaccine candidate has already been licensed to commercial partners to continue the research and to ultimately develop and disseminate this vaccine to industry,” she said. “We’re continuing to develop even better and new vaccine candidates.”
Read full article here
ASF, COVID-19 remain key issues for global pork markets
The combination of African swine fever (ASF) and COVID-19 will continue to affect global pork production in 2021, but demand is expected to rebound in most regions, according to a new report from Rabobank.
In its Pork Quarterly for the first quarter of 2021, Rabobank said China will see strong growth in pork production after its restocking efforts from 2020, while European pork production is expected to be flat or down slightly in 2021. In the U.S., strong demand is supporting hog prices, helping to offset high feed prices; in Brazil, hog production is expected to increase despite high feed costs.
In its report, Rabobank identifies four main issues associated with COVID-19 that will affect pork production and consumption at least through 2021.
- Working from home will remain
- The pivot away from foodservice channels will continue, with a gradual return
- Trust in the animal protein supply chains will take time to rebuild
- Foodservice will not return to “normal” until 2022 or 2023
Other challenges for pork production in 2021 will be the global trade environment and high feed costs
Read full article here
Beef:
Beef finishes strong, pork exports top record
U.S. pork exports reached nearly 3 million metric tons (mt) in 2020, topping the 2019 record by 11%, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). Pork export value also climbed 11% to a record $7.71 billion. USMEF pointed out that exports set new annual records in China/Hong Kong, Central America, Vietnam, and Chile, and achieved strong fourth-quarter growth in Japan and Mexico
U.S. beef exports finished 2020 lower year-over-year, falling 5% in both volume (1.25 million mt) and value ($7.65 billion). Still, USMEF said beef exports finished the year with very strong momentum, with fourth-quarter volume up 4.5% from 2019 and posting one of the best months on record in December. Beef exports to China were record-large in 2020 and a new volume record was also achieved in Taiwan.
Read full article here
NCBA sets 2021 priorities, elects new president
The executive committee of the National Cattlemen’s Beef Association (NCBA) approved during its recent virtual Winter Business Meeting the organization’s top 2021 policy priorities to focus on advocating for a business climate that increases opportunities for producer profitability. Jerry Bohn, a cattle producer from Wichita, Kan., was also elected as NCBA president.
“There is no doubt the past year has been difficult for cattle producers and it’s crucial that we work to implement sound policy and focus our attention on the legislative and regulatory areas that will give U.S. cattle producers the most added value,” said Bohn. “I am looking forward to collaborating with volunteer leadership, state affiliates and stakeholders across the country to tackle the most pressing issues facing our industry.”
Read full article here
Dairy:
World Milk Supply Grows in Pandemic
Despite the worst pandemic in more than a century that wreaked havoc in the global dairy sector, the world milk supply continued to increase. Government relief programs, retail channels, and overall demand were able to absorb much—but certainly not all—of the additional milk.
Betty Berning, analyst with the Daily Dairy Report, notes that “with the loss of dairy demand at foodservice, it is amazing that a home was found for much of 2020’s additional milk. Last year’s demand came in the form of government programs and elevated retail sales, along with strong purchases from key importing countries that were able to manage their Covid response well, such as China.”
Berning notes that China’s imports of skim milk powder (SMP) and whole milk powder (WMP) last year were lower than 2019’s record-high levels, after adjusting for leap year, but they were still strong. However, China’s 2020 imports of ultra-high temperature milk, at 845,000 metric tons (MT), climbed 16% above 2019 volumes while whey imports soared 38% to 626,000 MT, according to data from Trade Data Monitor.
Read full article here
Miscellaneous:
Impossible Foods the Subject of a Lawsuit over Leghemoglobin
The Center for Food Safety has initiated a lawsuit in the 9th Circuit U.S. Court of Appeals challenging the Food and Drug Administration approval of soy leghemoglobin. This ingredient produced in a genetically engineered yeast is effectively a non-nutrient color additive included in vegetable-based alt-meat burgers marketed by Impossible Foods to create the appearance of blood.
The Center for Food Safety claims that the FDA failed to conduct long-term animal studies to confirm the safety of the additive that corresponds to a natural pigment present in the roots of soy plants. The Center for Food Safety maintains that the FDA should have obtained “convincing evidence” of safety similar to the standard applied to other food additives and coloring agents.
Long-term toxicologic studies involve mutagenesis, carcinogenesis, teratogenesis, reproductive function and other metabolic responses in a range of test systems. The Center for Food Safety points to potential adverse effects in rats in a short-term evaluation of the compound. The Center for Food Safety claims that the genetically engineered heme is a novel ingredient and given the quantity added to plant-based burgers it should have been subjected to more extensive evaluation.
If the Court rules that the approval of soy leghemoglobin by the FDAwas contrary to acceptable practice, withdrawal of the compound from the Impossible Burger would seriously impact the organoleptic acceptability of the product and hence the profitability of the company.
Read full article here
Food Service Demand to Remain Depressed through Mid-2022
Will Sawyer of CoBank recently projected that food service demand would not be restored to pre-COVID levels until this second half of 2022. Sawyer noted that U.S. food consumption at home is at levels corresponding to the early 1980’s and that meat and food distribution has undergone profound changes since the emergence of COVID-19.
Sawyer writing in the CoBank Knowledge Exchange Division report stated, “As U.S. animal protein consumption slowly returns to normal, the food service section will still lag.” He added, “That means a challenging outlook for food service-focused animal proteins including high-value beef cuts, poultry produced for food services specifications and labor-intensive processed meat products.” Sawyer opined that fast-casual and quick service restaurants had recovered a large measure of their pre COVID sales by operating drive thru, curbside and in-store pick-up and home and office delivery.
Read full article here
Why virtual brands topped chicken foodservice in 2020
A growing number of chicken foodservice operators – searching for ways to meet growing demand for takeout and delivery during the pandemic – have opened virtual brands.
Brinker International, the parent company of Chili’s and Maggiano’s, opened It’s Just Wings.
Launched in June 2020, menu items from It’s Just Wings are prepared in the kitchens of 1,000 company-operated Chili’s and Maggiano’s but can only be ordered through DoorDash. The virtual brand sells boneless and smoked and traditional bone-in wings smothered in a choice of 11 sauces, such as truffle hot sauce and ponzo sauce. Every order also includes free curly fries.
“We’ve built everything around the killer wings/stupid prices approach, which just kind of represents that we provide a really good value and a really good product,” Wade Allen, SVP Head of Innovation, Brinker International, said.
Read full article here
Food worker union urges for expedited COVID vaccinations
United Food and Commercial Workers International Union President Marc Perrone issued a call for political leaders to expedite COVID-19 vaccine access for essential workers and urge further action on grocery hazard pay across the country.
In a media call Tuesday, Perrone says COVID-19 resulted in nearly 400 frontline worker deaths and 77,600 frontline workers infected or exposed. Specifically, he says 137 grocery worker deaths and over 30,100 workers were infected or exposed. In meatpacking plants, Perrone shares 132 workers have died and 21,900 meatpacking workers have been infected or exposed.
“Essential workers in grocery stores and meatpacking plants are not being prioritized for vaccine access in many states and continue to face delays that further endanger their health,” Perrone says. “Governors must immediately work with CEOs in these industries to ensure the vaccine is free for all essential workers and that workers have paid time off to receive each dose.”
Read full article here
The information in this newsletter is intended to update our readers of current events. Any third-party publications are presented for informational purposes only and the views presented in such publications are those of the respective authors. The views therein are not necessarily representative of Aeros or any other CULTURA company’s views on any particular topic.