Friday, April 29, 2022

Friday Market Watch

LIVESTOCK:

It was a tough close for the livestock complex as traders sent the contracts trailing lower and the cash markets saw little to no interest. Heading into next week's trade, all eyes will be on the contracts to see how much more downside lays within this move. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.43 with a weighted average of $100.14 on 4,367 head. June lean hogs are down $4.60 at $106.375. 

From Friday to Friday livestock futures scored the following changes: April live cattle off $0.55, June live cattle off $5.78, May feeder cattle off $1.60, August feeder cattle off $8.63, June lean hogs off $12.40 and July lean hogs off $10.00.

Friday's slaughter is estimated at 118,000 head, 1,000 head less than a week ago and 2,000 head more than a year ago. Saturday's slaughter is projected to be around 40,000 head, 23,000 head less than a week ago and 16,000 head less than a year ago. This week's slaughter is estimated at 656,000 head, 9,000 head less than a week ago and 3,000 head more than a year ago.

Boxed beef prices closed lower: choice down $1.82 ($260.78) and select down $3.09 ($247.97) with a movement of 127 loads (58.71 loads of choice, 20.69 loads of select, 36.45 loads of trim and 11.58 loads of ground beef). On average throughout the week choice cuts averaged $263.21 (down $6.37 from last week) and select cuts averaged $252.82 (down $4.31 from last week) and with a total movement of cuts, grinds, and trim totaling 705 loads.


GRAINS:

July corn closed unchanged and December corn was down 1/2 cent. July soybeans closed unchanged, and November soybeans were down 6 1/4 cents. July KC wheat closed down 35 1/2 cents, July Chicago wheat was down 30 cents and July Minneapolis wheat was down 23 3/4 cents. 


DAIRY:

MILK

Class III milk futures were lower for the week in all contracts except for July. This was a reflection of an overall decline of cheese and dry whey prices. The week was not without volatility, but the result was a bit disappointing. Class IV futures closed steady to higher across the board Friday with prices generally mixed for the week. The market seems to be comfortable at the current price levels, while remaining supported. There is little concern of significant pressure on milk prices at present, but there is some concern over market potential if milk production increases and cow numbers increase. Of course, it will not make a difference if demand remains strong or increases. USDA released the March Agricultural Prices report, which showed an increase in the average corn price from February of $0.46 per bushel and a price of $6.56. The premium/supreme hay price averaged $269 per ton, up $3 per ton from February. The all-milk price averaged $25.90 per cwt, up $1.20 from February. The soybean meal price averaged $493.98 per ton, up $13.02 per ton from the previous month. This resulted in an income-over-feed price of $11.55 compared to $10.98 for February.

AVERAGE CLASS III PRICES

3 Month: $24.45
6 Month: $24.28
9 Month: $23.86
12 Month: $23.22

CHEESE

For the week, block cheese price declined 2.25 cents with three loads traded. Barrel cheese price declined 3 cents with 12 loads traded. Dry whey declined 3 cents with 10 loads traded. Business is being done without a lot of fanfare. Prices seem to be moving in a sideways pattern. Demand is good but there is some concern over higher prices having an impact on overall demand as time moves forward. Food prices in general are increasing, which will affect what consumers will purchase.

BUTTER

For the week, butter increased 0.75 cent with nine loads traded. Grade A nonfat dry milk price remained unchanged with eight loads traded. Churning remains active with sufficient cream supply for production. Ice cream production is increasing, utilizing more cream, but there remains sufficient supply available for demand. The increase of price over the past two days was a matter of buyers taking advantage of the low price and not a change in trend.


OUTSIDE MARKETS:

The June U.S. Dollar Index is trading down 0.719 at 102.940. June gold is up $20.50 at $1,911.80, July silver is down $0.12 at $23.07 and July copper is down $0.0235 at $4.4100. June crude oil declined $0.67, ending at $104.69 per barrel. The Dow fell 939 points, closing at 32,977, while the NASDAQ fell 537 points, closing at 12,335. June RBOB is down $0.0359 and June natural gas is up $0.359.




Thursday, April 28, 2022

This Week's Drought Summary (4/28)

Only about 10 days after a powerful, winter-like storm struck the northern Plains, a similar system delivered another round of heavy precipitation and high winds. With the more recent storm, which primarily unfolded on April 22-23, heavy snow was focused across a smaller area, primarily blanketing western North Dakota, southeastern Montana, northwestern South Dakota, and portions of Wyoming. Meanwhile in the Red River Valley, heavy rain falling on partially frozen soils resulted in extensive flooding, especially north of Fargo, North Dakota, with runoff further enhanced by melting snow. Farther south, high winds again raked the central and southern Plains and the Southwest, resulting in blowing dust and fast-spreading wildfires. Across the southern High Plains’ hardest-hit drought areas, hot, windy weather sapped any remaining soil moisture and further stressed rangeland, pastures, and winter grains. Meanwhile, a few severe thunderstorms dotted the Plains and upper Midwest, leading to localized wind and hail damage. The greatest concentration of severe weather occurred on April 22 from South Dakota to northern Texas. In contrast, little or no precipitation fell during the week across the nation’s southwestern quadrant, leading to further drought intensification. As the drought-monitoring period ended (on the morning of April 26), a significant rain event was winding down across parts of southern and eastern Texas.


Northeast

With a cool, mostly dry weather pattern in place, there were no changes to the Northeastern drought depiction. Small areas of moderate drought (D1) existed in Maine, Maryland, and West Virginia, but much of the region was free of dryness and drought. In drought-affected areas, concerns included low streamflow and groundwater shortages.

Southeast

Generally dry weather prevailed during the drought-monitoring period. As a result, there were some slight increases in the coverage of abnormal dryness (D0) and moderate to severe drought (D1 to D2) from Florida to North Carolina. On April 24, Florida led the region with topsoil moisture rated 38% very short to short, followed by Georgia at 31%, according to the U.S. Department of Agriculture. On the same date, 22% of Florida’s pastures were rated in very poor to poor condition.

South

The region remained split between critically dry conditions on the High Plains of Oklahoma and Texas and wet conditions just to the east. During the drought-monitoring period, the axis of heaviest rain stretched from northeastern Texas into northern Arkansas, with additional rainfall maxima in parts of southern and eastern Texas. Those rains led to targeted, one-category improvements in the drought depiction, with highly localized two-category changes. Meanwhile, the region’s driest areas continued to experience deteriorating conditions, including a broad expansion of exceptional drought (D4), amid periods of extreme heat, high winds, and blowing dust. Temperatures reached 100°F—mainly on April 20 and 21—in parts of the south-central U.S., extending to the Texas-Oklahoma border near Childress (100°F on April 21) and Wichita Falls, Texas (99°F on April 20). In western Texas, peak gusts April 22 were clocked to 73 mph in Lubbock and Dalhart. On April 24, Texas led the country in several drought-related categories, according to the U.S. Department of Agriculture, including topsoil moisture rated very short to short (86%, tied with New Mexico) and winter wheat rated in very poor to poor condition (78%). On the same date, nearly half (48%) of Oklahoma’s wheat was rated very poor to poor.

Midwest

Widespread precipitation, accompanied by cool conditions, led to general reductions in the coverage of abnormal dryness (D0) and moderate drought (D1). In fact, a pesky area of D1, stretching across portions of eastern Iowa, northern Illinois, and southern Wisconsin, was finally eliminated by soaking rainfall. Drought (D1) was also completely removed from northern Minnesota, following another round of heavy precipitation. Daily-record rainfall amounts included 1.16 inches (on April 22) in Rockford, Illinois, and 1.49 inches (on April 23) in International Falls, Minnesota. By April 24, topsoil moisture was rated one-quarter to one-half surplus in all Midwestern States except Iowa, led by Illinois (49% surplus), according to the U.S. Department of Agriculture. In addition, only 7% of the intended U.S. corn acreage had been planted by April 24, the least amount sown on that date since 2013. Corn seeding was at least 10 percentage points behind the 5-year average planting pace in Illinois, Iowa, Kentucky, Minnesota, and Missouri. Cold weather was a factor in the slow planting place, along with wet conditions. On the morning of April 26, daily-record low temperatures in Iowa included 19°F in Sioux City and 22°F in Cedar Rapids.

High Plains

For the second week in a row, significant precipitation fell across parts of the northern Plains. Heavy snow blanketed western North Dakota, southeastern Montana, northwestern South Dakota, and parts of Wyoming, helping to further improve soil moisture. Still, by April 24, the U.S. Department of Agriculture reported topsoil moisture was rated at least one-half very short to short in each of the region’s states except North Dakota (26% very short to short, down from 39% the previous week). Elsewhere in the region, topsoil moisture rated very short to short ranged from 53% in South Dakota to 82% in Nebraska. Still, parts of the eastern Dakotas have become very wet, with runoff enhanced by melting snow and rain falling on partially frozen soils. Following the latest storm, moderate to major flooding developed in the Red River Valley, extending northward from near Grand Forks, North Dakota. By April 27, the Red River at Oslo, Minnesota, was more than 11.5 feet above flood stage and less 10 inches below the April 2009 high-water mark. Farther south, however, drought continued to gradually expand and intensity, amid windy, mostly dry conditions and rapid temperature fluctuations. In Nebraska, daily-record highs for April 22 soared to 91°F in Sidney and 97°F in Valentine and North Platte, followed just 3 days later by a daily-record low of 14°F in Sidney. By April 24, more than one-quarter of the winter wheat in each of the region’s major production states was rated in very poor to poor condition, led by Colorado (47%) and Kansas (36%).


West

Conditions were nearly identical those observed the previous week, with beneficial precipitation falling across the northern tier of the region and windy, dry weather dominating the Southwest. Given the Southwest’s low humidity levels, high winds, and drought-cured vegetation, two active wildfires—the Hermits Peak and Cooks Peak Fires—charred more than 50,000 acres of vegetation apiece in northeastern New Mexico. Northeast of Flagstaff, Arizona, the Tunnel Fire—ignited on April 17—scorched nearly 20,000 acres of vegetation and destroyed more than 50 structures. At times, impressively high winds raked the Southwest, raising dust and fanning flames. On April 22 in New Mexico, wind gusts in Gallup, Farmington, Las Vegas, and Raton were clocked to 70, 72, 73, and 80 mph, respectively. By April 24, according to the U.S. Department of Agriculture, New Mexico led the nation—tied with Texas—with topsoil moisture rated 86% very short to short. By the 26th, Tucson, Arizona, reported a daily-record high of 100°F—only the fourteenth observance of triple-digit heat on record during April in that location. Tucson’s only earlier readings of 100°F or higher occurred on April 19-21, 1989, and April 22-23, 2012. Deterioration was common across the Southwest, with extreme to exceptional drought (D3 to D4) broadly expanding in New Mexico and moderate to severe drought (D1 to D2) increasing in coverage across parts of Arizona and Colorado. Farther north, however, periods of precipitation continued from northern California and the Pacific Northwest to the northern Rockies. Changes in the Northwestern drought depiction, although fewer than those noted the previous week, were driven by factors such as improving water-supply prospects and increasing topsoil moisture. In Oregon, topsoil moisture rated very short to short improved from 47 to 36% during the week ending April 24.


Caribbean

In Puerto Rico, locally heavy showers resulted in a slight reduction in the coverage of abnormal dryness (D0) and moderate drought (D1). However, D0 persisted along Puerto Rico’s northwestern coast, while D0 and D1 continued across portions of the southern slopes and coastal areas.

In summary, showers brought some rain to the U.S. Virgin Islands (USVI) this week, but rainfall totals were below weekly normals. Radar-based estimates (QPE) of weekly rainfall showed widespread rain across Puerto Rico but only a few pockets of rain over the USVI, specifically half an inch or less over parts of St. Thomas and St. John and a fourth of an inch or less over western and southern parts of St. Croix. Groundwater levels continued to decline on all three islands and there were reports of low cisterns. With the lack of soaking rains, moderate drought continued on St. John and St. Thomas and severe drought continued on St. Croix.

Weekly rain gauge totals on St. John ranged from 0.44 inch to 0.68 inch. The 0.44 inch at Windswept Beach was below the long-term average for the week of 0.64 inch, and the monthly total of 1.23 inches is 52% of the long-term average for the month-to-date. Standardized Precipitation Index (SPI) values support drought at the long-term time scales. The groundwater level at the USGS Susannaberg DPW 3 Well on St. John continued to decline this week and has steadily declined since early February. It is at the lowest level since 2017. D1-SL continued for St. John.

On St. Thomas, weekly rain gauge totals ranged from 0.28 inch to 0.44 inch. The weekly total of 0.41 inch at King AP was below normal, and the 1.47 inches for the month so far was 82% of normal. The SPI values support drought at the long-term time scales, but not at the short-term time scales. The groundwater level at the USGS Grade School 3 Well on St. Thomas continued to decline this week and has steadily declined since early February. D1-L continued for St. Thomas.

St. Croix was the driest island of the three this week, with weekly rain gauge totals ranging from zero to 0.34 inch, and most about a tenth of an inch or less. Rohlsen AP and East Hill both reported no measurable rain this week. The April-to-date total of 0.25 inch at Rohlsen AP was 14% of normal for the month and sixth driest out of 63 years, and the 0.53 inch at East Hill was 29% of normal and sixth driest out of 48 years. Rohlsen AP has received 25.71 inches for the last 12 months (4/27/2021-4/26/2022), which ranks as eighth driest out of 62 years for comparable 12-month periods. The SPI values at Rohlsen AP and East Hill support significant drought at both the 1-month and 9- to 12-month time scales. The groundwater level at the USGS Adventure 28 Well on St. Croix continued to decline this week and has steadily declined for the past year. It is at the lowest level in the 2016-2022 record. Reports have been received of cracked soil and dry vegetation, with the “hot, dry, windy” weather causing distress for local farmers. D2-SL continued for St. Croix.

Pacific

Abnormal dryness (D0) was introduced in a small area of southwestern Alaska, including low elevations of the lower Yukon-Kuskokwim region, where the spring has been dry and relatively warm. In addition, an unusually high percentage of the region’s winter precipitation fell as rain, rather than snow, leading to early elimination of low-elevation snowpack. In recent days, the Kwethluk Fire burned across nearly 10,000 acres of tundra in the Yukon Delta National Wildlife Refuge. Although spring fires in this region are not unusual, the Kwethluk Fire is Alaska’s largest April wildfire in at least the last 30 years.

In Hawaii, a tight gradient persisted between locally heavy showers in windward locations and dry weather on most leeward slopes. A bit of abnormal dryness (D0) was erased from windward sections of Molokai and Maui; otherwise, there were no changes. Through April 26, month-to-date rainfall at Hawaii’s major airport observation sites ranged from 0.04 inch (6% of normal) in Honolulu, Oahu, to 15.03 inches (179%) in Hilo, on the Big Island. Hilo reported measurable rain each day from March 28 to April 26, a 30-day streak.

Rain associated with the Inter-Tropical Convergence Zone (ITCZ) and trade-wind troughs brought a wet week to much of Micronesia, stretching from Palau, across the Federated States of Micronesia (FSM), to southern parts of the Marshall Islands (RMI). An upper-level low gave the northern RMI some rain. The ITCZ rains missed some southern parts of the FSM, while a dry trade-wind pattern dominated the Marianas. South of the equator, American Samoa was caught between a dry ridge to the north and a showery South Pacific Convergence Zone (SPCZ) to the south. As a result of this mix of weather features, the drought status did not change across the USAPI this week. Severe drought continued in the northern RMI and abnormal dryness continued at Kapingamarangi, with no drought or abnormal dryness at the rest of the USAPI stations.

In the Marianas, weekly rainfall totals ranged from 0.27 inch at the Saipan ASOS station to 0.84 inch at Guam. These values are below the weekly minimum required to meet most water needs, which is one inch for the Marianas. However, rainfall from earlier in the month gave Guam, Saipan, and Rota a wet April (above the 4-inch monthly minimum required to meet most water needs), so D-Nothing continued.

Over 4 inches of rain fell this week in Palau at Airai (4.53 inches) and Koror COOP (7.59), with month-to-date April totals over 15 inches at both stations. D-Nothing continued for Palau.

SPCZ showers gave the automated station at Toa Ridge 1.53 inches of rain this week and 1.41 inches at Pago Pago, which are above the 1-inch weekly minimum for American Samoa, but only 0.64 inch at Siufaga Ridge. Wet conditions during earlier weeks supported the continuation of D-Nothing for Tutuila.

In the FSM, Yap reported 0.95 inch of rain for the week and Kapingamarangi 1.31 inches. The rest of the regular-reporting stations were wet (above the 2-inch weekly minimum for the FSM), with weekly rainfall totals ranging from 2.28 inches at Chuuk to 6.30 inches at Nukuoro. April-to-date was dry at Kapingamarangi (5.15 inches so far, which is below the monthly to-date minimum), so D0-S continued. Month-to-date rainfall totals for April were wet at the rest of the FSM stations, so D-Nothing continued, except for Fananu which could not be analyzed due to lack of data.

In the RMI, Utirik could not be analyzed due to lack of data. Less than half an inch of rain fell across parts of the northern islands, with Wotje recording 0.42 inch, which is less than the 2-inch weekly minimum for the Marshalls. April-to-date (4.76 inches) is dry, so D2-SL continued for Wotje. Jaluit reported 0.70 inch, but that was based on only 3 days of data, and Kwajalein reported 1.42 inches, which is dry for the week, but Ailinglaplap, Majuro, and Mili were wet, with weekly totals ranging from 5.61 inches to 7.94 inches. All of these stations were wet for the month, so D-Nothing continued for them.

Looking Ahead

The threat of frost and sub-freezing temperatures will linger at least into Friday in parts of the Great Lakes and Northeastern States. Meanwhile, a disorganized storm system will cross the western U.S. before intensifying on April 29-30 over the nation’s mid-section. With the storm’s path across the central Plains and upper Midwest, rainfall could reach 1 to 3 inches in the north-central U.S., with some of the highest amounts expected on Friday in the Dakotas. Meanwhile, windy, dry weather in the nation’s southwestern quadrant will lead to additional drought and wildfire concerns. Late in the weekend, however, portions of the southern Plains may experience some drought relief.

The NWS 6- to 10-day outlook for May 3 – 7 calls for the likelihood of near- or below-normal temperatures across the North and Far West, while warmer-than-normal weather will prevail from the Four Corners States eastward to the middle and southern Atlantic Coast. Meanwhile, near- or above-normal precipitation across most of the country should contrast with drier-than-normal conditions in the upper Great Lakes region and parts of the Southwest.




Monday, April 25, 2022

USDA Weekly Crop Progress Report - 7% of Corn, 3% of Soybeans Planted; Winter Wheat Condition Rated 27% Good to Excellent

OMAHA (DTN) -- Cold and snow over much of the Northern Plains, wet conditions in the Eastern Corn Belt and drought in parts of the Midwest, West and Southern Plains continued to keep planters parked and hampered the development of winter wheat last week, USDA NASS reported in its weekly Crop Progress report on Monday.

CORN

-- Planting progress: 7% nationwide as of Sunday, April 24, up just 3 percentage points from the previous week. Current progress is 9 percentage points behind last year's 16% and 8 percentage points behind the five-year average of 15%.

-- Crop development: 2% of corn was emerged as of Sunday, 1 percentage point behind both last year's and the five-year average of 3%.

-- Notable states: Texas again led the way in corn-planting progress at 69%, up 5 percentage points from the previous week. States making the most progress last week were North Carolina, which jumped ahead 21 percentage points to reach 60% complete; Tennessee, moving ahead 10 percentage points to reach 17%; Kansas and Nebraska, both progressing 8 percentage points to 21% and 10%, respectively; and Missouri, which moved ahead 6 percentage points to reach 10% complete.

States currently the furthest behind their average pace include Tennessee at 20 percentage points behind its five-year average; Illinois and Missouri, both at 19 percentage points behind average; and Kentucky at 18 percentage points behind average.

SOYBEANS

-- Planting progress: 3% nationwide as of Sunday, up just 2 percentage points from the previous week. That was 4 percentage points behind last year's 7% and 2 percentage points behind the five-year average of 5%.

-- Notable states: Louisiana and Mississippi made the most planting progress last week with gains of 16 percentage points and 14 percentage points, respectively.

As with corn planting, Illinois was one of the states furthest behind its five-year average with just 1% of soybeans planted, 7 percentage points behind its five-year average of 8%.

WINTER WHEAT

-- Crop development progress: 11% of the winter wheat crop was headed nationwide as of Sunday. That's 5 percentage points behind last year's 16% and 8 percentage points behind the five-year average of 19%.

-- Notable states: None of top winter-wheat-producing state Kansas' crop was heading as of Sunday, according to NASS. That is 7 percentage points behind the state's five-year average of 7%. In Oklahoma, only 6% of wheat was heading, 32 percentage points behind the five-year average of 38%. Texas winter wheat development was also considerably behind normal at 45% headed, 15 percentage points behind the average of 60%.

-- Crop condition: Nationwide, winter wheat was rated 27% good to excellent, falling 3 percentage points from 30% the previous week. The current rating is well below last year's good-to-excellent rating of 49%.

"The winter wheat crop's current good-to-excellent rating is the lowest on record for this time of the year," said DTN Senior Analyst Dana Mantini. "That portion of the crop rated very poor to poor is 39%, 2 percentage points higher than last week. Major producer Kansas is 26% good to excellent with 36% poor to very poor. Oklahoma and Texas are at 16% and 8% good to excellent, respectively. Seventy-eight percent of the Texas crop is rated very poor to poor.







Bureau of Reclamation, Pacific Northwest Region - Storage Reservoirs in the Upper Snake River (4/25)


Average daily streamflows indicated in cubic feet per second.
Reservoir levels current as of midnight on date indicated.

Upper Snake River system is at 59 % of capacity.
(Jackson Lake,Palisades, Grassy Lake,Island Park,Ririe,American Falls,LakeWalcott)
  
Total space available:1653221 AF
Total storage capacity:4045695 AF



Friday, April 22, 2022

Friday Market Watch

LIVESTOCK:

Friday came and went, and though the cattle contracts would have liked to round out the week on a higher note, no one is complaining after the week the market just had. The lean hog complex closed higher in its nearby contracts, but what was even more impressive is the movement that pork cutouts had. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $6.91 with a weighted average of $99.13 on 3,197 head

From Friday to Friday, livestock futures scored the following changes: April live cattle up $1.78, June live cattle up $2, April feeder cattle down $0.25, May feeder cattle up $2.10, June lean hogs up $0.30, July lean hogs up $0.60.

Friday's slaughter is estimated at 119,000 head -- 5,000 head more than a week and year ago. Saturday's slaughter is estimated at 63,000 head -- 41,000 head more than a week ago and 8,000 head less than a year ago. This week's slaughter is estimated at 665,000 head -- 31,000 head more than a week ago and steady with a year ago.

Boxed beef prices closed lower: choice down $2.26 ($267.91) and select down $0.91 ($254.77) with a movement of 95 loads (57.74 loads of choice, 15.46 loads of select, 11.47 loads of trim and 10.39 loads of ground beef).


GRAINS:

July corn closed down 6 1/4 cents per bushel and December corn was down 14 1/4 cents. July soybeans closed down 31 1/2 cents and November soybeans were down 26 1/2 cents. July KC wheat closed up 6 cents, July Chicago wheat was down 1 1/4 cents and July Minneapolis wheat was up 7 1/4 cents

For the Week:

July corn finished up 5 1/4 cents, December corn finished down 10 3/4 cents. July beans closed up 22 3/4 cents, and November beans rose 3 3/4 cents. Chicago July wheat ended up down 29 1/4 cents, KC July was down 7 3/4 cents, and Minneapolis July wheat closed 15 1/2 cents higher.


DAIRY:

MILK

Class III milk futures increased 1 cent to settle at $24.32 for April. May futures slipped 2 cents to $24.55. June slipped 4 cents, settling at $24.78. Class IV milk futures for April were unchanged at $25.20. May futures were down 4 cents to $24.62. June declined 21 cents, settling at $24.24. February fluid product sales totaled 3.5 billion pounds, 3% lower than a year earlier. Conventional fluid milk declined by 3%, and organic fluid milk fell by 3.9%.

AVERAGE CLASS III PRICES

3 Month: $24.55
6 Month: $24.52
9 Month: $24.14
12 Month: $23.54

CHEESE

Cold storage American cheese totaled 822.2 million pounds, slipping 1% from a year ago and from the previous month. Swiss cheese was at 23 million pounds, up 2% from a year ago, but down 8% from a month ago. Other cheese totaled 612.8 million pounds, staying level from a year ago and from the previous month. Total natural cheese slipped 1% from a year ago, totaling over 1.5 billion pounds. This was also 1% lower from a month ago.

BUTTER

Cold storage butter held 283.1 million pounds, declining 20% from a year ago and increasing 8% from February. Butter prices rising in grocery stores are contributing to the decline in consumer demand. Bulk butter ranges from 5 to 15 cents above market.


OUTSIDE MARKETS:

The June U.S. Dollar Index is trading up 0.536 at 101.150. June crude oil slipped $1.72, settling at $102.07. The Dow dropped 981 points to 33,811, and the NASDAQ fell 335 to 12,839. June gold is down $12.50 at $1,935.70, May silver is down $0.31 at $24.32 and May copper is down $0.1190 at $4.5850. June heating oil is up $0.0169, June RBOB is down $0.0306 and May natural gas is down $0.421.







Rural Mainstreet Index: Farmland Prices Grow at Rapid Pace

For 17 straight months, the rural economy has posted healthy and consistent growth. That’s according to the April Rural Mainstreet Index (RMI) from Creighton University.

For Aril 2021, the RMI sits at 62. That is a small drop from March’s 65.4. The index ranges between 0 and 100 with a reading of 50 representing growth neutral and is generated by a monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

“The region recorded a 34% gain in farm commodity prices over the past 12 months, but low short-term interest rates and healthy farm income have underpinned the Rural Mainstreet Economy,” says Ernie Goss, who chairs Creighton’s Heider College of Business and leads the RMI.  

The region’s farmland price index for April climbed to a strong 80 from 78 in March. That marks the 19th straight month that the index has moved above growth neutral. Over the past several months, the RMI has registered the most consistent and strongest growth in farmland prices since the survey was launched in 2006. 

Here are the state-by-state April farmland price indexes: 

  • Colorado: 81.5, up from 76.2 
  • Illinois: 85.7, up from 79.1 
  • Iowa: 78.5, down from 80.3 
  • Kansas: 77, up from 73.6 
  • Minnesota: 78.3, up from 77.4
  • Missouri: 81.1, up from 80.1 
  • Nebraska: 62.2, down from 78.2
  • North Dakota: 82.6, up from 79.3
  • South Dakota: 78, up from 75 
  • Wyoming: 81.9, up from 79

This month bankers were asked to forecast the impact of President Biden’s emergency waiver on the summer production of E-15 ethanol. Fewer than 4 of 10 bankers, expect the move to have a positive impact. More than half (56.5%) expect the waiver to have little or no impact. 

On average, bank CEOs estimate 2.3% of farmers have been involved in cryptocurrency transactions in the past 12 months. 

More than 9 of 10 bankers expect the Federal Reserve interest rate setting committee to raise short-term interest rates by one-half of one percentage point at its next meeting on May 3-4. 

“The Federal Reserve has been behind in raising interest rates,” shared Jeffrey Gerhart, Chairman of the Bank of Newman Grove in Newman Grove, Neb.

Russia’s invasion of Ukraine, along with accompanying global trade tensions and surging inflation, pushed the business confidence index to its lowest level since the beginning of the pandemic in Spring 2020. The index, which reflects bank CEO expectations for the economy six months out, plummeted to 39.1 from 54 for March. 

The RMI, which started in 2005, represents an early snapshot of the economy of rural agricultural and energy-dependent portions of the nation. It focuses on 200 rural communities with an average population of 1,300.



 

Thursday, April 21, 2022

This Week's Drought Summary (4/21)

The drought-monitoring period, which began on the morning of April 12 and ended early April 19, featured a powerful spring storm delivering significant, late-season snow from the Cascades and Sierra Nevada to the northern Plains. High winds and blizzard conditions accompanied the snow, especially across the northern Plains. Farther south, drought conditions worsened across portions of the central and southern Plains and the Southwest, amid windy, dry conditions. At times, winds raised dust and contributed to the rapid spread of several wildfires, including the 6,159-acre McBride Fire, which destroyed well over 300 structures after being ignited on April 12 in Ruidoso, New Mexico. Meanwhile, heavy showers and locally severe thunderstorms swept across the Mississippi Delta and environs, producing widespread rainfall totals of 2 to 4 inches or more and causing localized wind and hail damage. Significant rain fell in other areas, including parts of the Midwest and Northeast. During the last 24 hours of the drought-monitoring period, rain swept into the Atlantic Coast States, with some wet snow observed across the interior Northeast. Warm weather prevailed for much of the period in the South and East, while a harsh cold snap engulfed the northern Plains and Northwest. In fact, an extended spell of chilly weather broadly covered the western U.S., as well as the upper Midwest.


Northeast

Widespread precipitation (rain and snow) resulted in modest reductions in the coverage of abnormal dryness (D0) and moderate drought (D1). In addition, moderate drought (D2) was finally removed from northern New England for the first time since mid-June 2021. Binghamton, New York, in a drought-free section of the Northeast, received 11.4 inches of snow on April 19—a record-setting amount so late in the spring. Binghamton also set a 2-day snowfall record for April, with 14.6 inches (previously, 13.6 inches on April 15-16, 2007).

Southeast

Rain moved into the southern Atlantic States at the end of the drought-monitoring period, with only slight impact on the depiction of abnormal dryness (D0) and patchy moderate to severe drought (D1 to D2). Meanwhile, heavier rain fell in Alabama and western sections of Georgia and Florida, reducing or eliminating the coverage of abnormal dryness (D0) and moderate drought (D1).

South

Heavy rain fell across roughly the eastern half of the region, resulting in extensive reductions in the coverage of abnormal dryness (D0) and moderate to extreme drought (D1 to D4). According to a network of volunteer (CoCoRaHS) observers, month-to-date rainfall totals of 6 to 8 inches or more are common across the region. April 1-19 rainfall officially reached 8.51 inches in Arkadelphia, Arkansas; 7.64 inches in Hattiesburg, Mississippi; and 6.70 inches in Troy, Alabama. In stark contrast, moderate to exceptional drought (D1 to D4) continued to worsen in many areas west of a line stretching across eastern sections of Oklahoma and Texas. On April 17, Texas led the U.S. (tied with Montana) with topsoil moisture rated 85% very short to short, according to the U.S. Department of Agriculture. Also, on the 17th, more than three-quarters (81%) of the winter wheat in Texas, along with 80% of the oats and 76% of the rangeland and pastures, were rated in very poor to poor condition. Nationally, 37% of the winter wheat was rated in very poor to poor condition on that date, highest at this time of year since April 14, 1996, when 43% of the crop fell into those two categories. On the southern High Plains, episodes of blowing dust or smoky skies have been common this spring; in Lubbock, Texas, visibilities were sharply reduced in dust on April 12, when a southwesterly wind gust to 60 mph was reported. The south-central U.S. has also experienced periods of extreme heat, with McAllen, Texas, reporting highs of 100°F or greater on April 6, 11, and 13. McAllen’s high of 109°F on April 6 set a monthly record (previously, 107°F on April 26, 1984, and April 27, 2014). However, there have also been cool spells, with Dalhart, Texas, posting a daily-record low of 22°F on April 14.

Midwest

Cool, damp conditions have resulted in widespread spring fieldwork delays. Several daily-record lows were set on April 19, with temperatures falling to 19°F in Cedar Rapids, Iowa; 26°F in Quincy, Illinois; and 32°F in Cape Girardeau, Missouri. The day before, on April 18, daily-record snowfall totals included 1.6 inches in Indianapolis, Indiana, and 2.3 inches in Dayton, Ohio. Among Midwestern States, corn planting had begun by April 17 only in Kentucky (6% sown, versus the 5-year average of 16%) and Missouri (4% sown, versus 12% on average). On the same date, topsoil moisture ranged from 40 to 60% surplus in Illinois, Indiana, Michigan, and Ohio, according to the U.S. Department of Agriculture. Still, there were a few pockets of abnormal dryness (D0) and moderate to severe drought (D1 to D2) mainly across the upper Midwest, with general improvement noted in many areas over the last week.

High Plains

A winter-like storm pounded North Dakota and portions of neighboring states, delivering much-needed moisture but disrupting travel and stressing livestock. Across the remainder of the High Plains, however, windy, dry weather raised dust, resulted in fast-spreading wildfires, and led to a broad increase in the coverage of abnormal dryness (D0) and moderate to extreme drought (D1 to D3). In North Dakota, April 12-14 snowfall included 12.6 inches in Grand Forks (National Weather Service office) and 18.3 inches in Bismarck. Storm-total snowfall topped 2 feet in several North Dakota communities, including Velva (28.0 inches), Lansford (27.5 inches), Dunn Center (26.0 inches), and Underwood (24.3 inches). During the storm, a wind gust to 54 mph was clocked in Bismarck; elsewhere in North Dakota, gusts reached 60 mph in Dickinson and 63 mph in Minot and Hettinger. In the storm’s wake, single-digit low temperatures were common across snow-covered North Dakota, where temperatures fell to 8°F in Minot and Grand Forks. With a low of 0°F on the 16th, Bismarck, North Dakota, experienced its latest-ever reading of 0°F or below—and its coldest April weather since 1996, when it was -1°F on April 5. Temperatures briefly plunged across the central Plains, threatening the already drought-stressed winter wheat crop. Denver, Colorado, registered 10°F on April 13, a record for the date, followed the next day by daily-record lows of 4°F in Sidney, Nebraska, and 9°F in Colby, Kansas. By April 17, the U.S. Department of Agriculture reported that topsoil moisture was rated more than 60% very short to short in each of the region’s states except North Dakota, led by Nebraska (84% very short to short). On the same date, nearly half (48%) of the winter wheat in Colorado was rated in very poor to poor condition. One-fifth to one-third of the wheat was rated very poor to poor in Kansas (31%), Nebraska (27%), and South Dakota (22%).


West

A classic La NiƱa regime has developed in recent weeks, providing beneficial moisture across northern California and the Pacific Northwest, eastward to the northern Rockies. At the same time, dry, often windy weather has affected the nation’s southwestern quadrant. As a result, deterioration has been observed in parts of the Southwest, particularly in New Mexico. According to the U.S. Department of Agriculture, Montana (85%) led the West in topsoil moisture rated very short to short on April 17, followed by New Mexico (80%). New Mexico, in addition to the McBride Fire, has been dealing with several other blazes, including the 7,573-acre Hermits Peak Fire, which started as a prescribed fire northwest of Las Vegas on April 6 before escaping containment. More recently, the Crooks Fire has been actively burning south of Prescott, Arizona, with numerous evacuations in effect. Farther north, however, the recent spell of cool, damp weather has generally boosted topsoil moisture, has locally improved water-supply prospects, and has provided a late-season boost in high-elevation snowpack. Snow briefly fell at lower elevations, too, with the airport in Portland, Oregon—which had never experienced a measurable April snowfall—receiving 1.9 inches on April 11-12. The airport’s previous latest snow had fallen on March 25, 1965, when 0.3 inch fell. Downtown Portland, hit with 2.0 inches of wet snow on April 11, also set a record for its latest accumulation (previously, 0.1 inch on April 10, 1903). Measurable snow fell in Great Falls, Montana, each day from April 11-17, totaling 12.2 inches. Farther west, the first-ever measurable April snow fell at the agricultural experiment station in Wenatchee, Washington. Incredibly, the Wenatchee Experiment Station received 10.4 inches of snow on April 14, boosting its month-to-date total to 13.1 inches. A neighboring station, the Wenatchee Water Plant, received a storm total of 5.4 inches, breaking its April 1935 record of 0.5 inch. The net effect of the Northwestern precipitation was to result in slight trimming of moderate to extreme drought (D1 to D3). However, there was often a fine line between areas that received beneficial precipitation and those that did not.


Caribbean

In Puerto Rico, patchy abnormal dryness (D0) and moderate drought (D1) persisted in some southern areas, where impacts included poor pasture conditions, low streamflow, and groundwater shortages. Meanwhile, dryness (D0) expanded slightly across central Puerto Rico and persisted along the northwestern coast.

In summary, radar-based estimates of precipitation showed a fourth of an inch or less rainfall falling across the U.S. Virgin Islands this week. Continued dry conditions in April and continued declining groundwater levels kept St. John and St. Thomas in moderate drought and St. Croix in severe drought. Low cisterns and SPI values reflected intensifying short-term dryness (S) which added to the long-term dryness (L) on St. John and St. Croix, while the drought continued at the long-term (L) time scale for St. Thomas.

On St. John, two CoCoRaHS stations had 0.19 and 0.23 inch of rain this week, with month-to-date totals of 0.97 and 1.03 inches. Windswept Beach reported 0.20 inch for the week and 0.77 inch for the month. The long-term weekly average at Windswept Beach is 0.64 inch so we can conclude that these stations were “below normal” for the week; Windswept Beach was also “drier than normal” for the month at 44% of the long-term average. The groundwater level at the USGS Susannaberg DPW 3 Well on St. John continued to decline this week and has steadily declined since early February. It is at the lowest level since 2017. Local reports indicated many cisterns were less than half full, with 50 to 60% of those tested nearly dry. The dry conditions thus far in April pushed the 1-month Standardized Precipitation Index (SPI) into the abnormally dry category, so the drought status for St. John was changed to D1-SL.

Based on available data, the CoCoRaHS stations on St. Thomas had weekly rainfall totals mostly a third of an inch or lower with values ranging from 0.16 to 0.37 inch. King AP recorded 0.24 inch for the week, which is less than half the weekly normal. The month-to-date total of 1.06 inches at King AP is 79% of normal and the year-to-date total is 8.45 inches or 109% of normal. The groundwater level at the USGS Grade School 3 Well on St. Thomas continued to decline this week and has steadily declined since early February. Local reports indicated many cisterns were less than half full, with 50 to 60% of those tested nearly dry. These data and the SPI values support continuation of D1-L.

On St. Croix, the CoCoRaHS weekly precipitation totals ranged from zero to 0.19 inch, with most stations having some missing data. Month-to-date totals at the CoCoRaHS stations range from 0.10 to 0.62 inch. The weather station at East Hill had 0.15 inch for the week, which is below normal, and 0.53 inch for the month to date, which is 43% of normal. Rohlsen AP had no measurable rain for the week; the 0.25 inch for the month is 20% of normal. The groundwater level at the USGS Adventure 28 Well on St. Croix continued to decline this week and has steadily declined for the past year. It is at the lowest level in the 2016-2022 record. The dry conditions thus far in April pushed the 1-month Standardized Precipitation Index (SPI) into the drought category, so the drought status for St. Croix was changed to D2-SL.

Pacific

There were no changes in Alaska, which remained free of dryness and drought. In recent days, cold, dry conditions in eastern Alaska contrasted with mild weather across the state’s western tier.

In Hawaii, rainfall has intensified in recent weeks across many windward locations, while dryness has persisted across most leeward slopes. As a result, the drought gradient has tightened on many of the Hawaiian islands. On the Big Island, for example, the depiction ranges from no dryness across eastern parts of the island to extreme drought (D3) on the leeward Kohala slopes. Hilo (on the Big Island) received 12.94 inches of rain (204% of normal) during the first 19 days of April, while Honolulu, Oahu reported just 0.02 inch (4%).

In summary, for the U.S.-Affiliated Pacific Islands (USAPI), rain this week contributed to the removal of drought and abnormal dryness from the Marianas and improved conditions at Wotje to severe drought. Abnormal dryness continued for Kapingamarangi while the rest of the USAPI remained free of drought and abnormal dryness.

This USDM week was dry (less than the 2-inch weekly minimum required to meet most water needs) in the Republic of Palau, with Airai measuring 0.99 inch of rain and Koror COOP reporting 1.69 inches. But heavy rains from Tropical Cyclone Malakas last week raised the monthly totals to well over the 8-inch monthly minimum, so D-Nothing continues.

In American Samoa, easterly trade winds and orographic showers gave Pago Pago 1.14 inches of rain, Siufaga Ridge 1.66 inches, and Toa Ridge 1.12 inches. These values were below normal, but normals are high at this time of year and the observations were above the 1-inch weekly minimum, so D-Nothing continues for Tutuila.

A monsoon trough in the wake of Malakas brought some showers this week to the Marianas. Rota recorded 5.59 inches of rain for the week, bringing the monthly total to 10.07 inches, which is more than double the 4-inch monthly minimum required to meet most water needs. Guam recorded 1.03 inches for the week, bringing the monthly total to 3.77 inches. In Saipan, the IAP reported 3.69 inches for the week, NPS station 3.99 inches, and ASOS station 3.76 inches; the monthly total was over 5 inches at each station. The rain was enough to end abnormal dryness at Saipan and Guam, so all of the Marianas is now free of drought and abnormal dryness.

In the Federated States of Micronesia (FSM), rain fell in the west from an exiting monsoon trough and in the east from an Inter-Tropical Convergence Zone (ITCZ) and its associated surface troughs. Weekly rainfall totals ranged from zero at Kapingamarangi to 6.13 inches at Pohnpei. Wet (more than the 2-inch weekly minimum) stations included Pohnpei, Kosrae, Lukunor, Nukuoro, Pingelap, and Ulithi. Dry (less than 2 inches) stations included Yap, Chuuk, Kapingamarangi, and Woleai (2 days of observations were missing at Woleai). Rain last week from Malakas (in the west) and the ITCZ (in the east) gave most stations a wet month-to-date, with most monthly totals already over the 8-inch monthly minimum. Exceptions include Lukunor and Kapingamarangi. With dry conditions this week and last week, and a dry month-to-date (only 3.84 inches), D0-S continued at Kapingamarangi. D-Nothing continued for the rest of the FSM stations, except Fananu which could not be analyzed due to lack of data.

The ITCZ and associated surface troughs, trade-wind convergence, and an upper-level trough transitioning to a cutoff low combined to give the Marshall Islands (RMI) a wet week. Weekly rainfall totals at the central and southern islands ranged from 2.96 inches at Jaluit to 8.56 inches at Majuro. Even Wotje received rain. The 1.90 inches for the week at Wotje was below the 2-inch weekly minimum and the month-to-date (4.34 inches) was below the monthly minimum for this time in the month, but the rain was enough to bring water catchment levels to roughly 50% of total capacity and the condition of vegetation was improving. This is the dry time of year for Wotje and Wotje is in the drier part of the RMI, so the 4.34 inches for April 2022 to date ranks as the 12th wettest April compared to full Aprils in the 39-year record. As a result of the improving conditions, Wotje was changed from D3-SL to D2-SL. The remaining stations continued at D-Nothing, except for Utirik which could not be analyzed due to missing data.

Looking Ahead

A parade of Pacific storms will maintain unsettled weather across much of the country during the next several days. One of the most consequential storms will traverse the western U.S. on April 21-22 before intensifying over the northern and central Plains. The storm system will result in similar impacts to those observed last week, including wind-driven snow across northern sections of the Rockies and Plains (mostly on April 22-23); high winds, possible blowing dust, and an elevated wildfire threat over a multi-day period across portions of the central and southern Plains and the Southwest; and a multi-day risk of severe thunderstorms, especially during the weekend from the Plains into parts of the mid-South and Midwest. In contrast, negligible precipitation will fall during the next 5 days along the Gulf Coast, in the Atlantic Coast States, and across the Southwest. The NWS 6- to 10-day outlook for April 26 – 30 calls for near- or below-normal temperatures across much of the country, with the greatest likelihood of cool conditions focused on the Great Lakes States. However, warmer-than-normal weather will prevail from southern California to the central and southern Great Plains. Meanwhile, near- or below-normal precipitation should be observed nationwide, except for wetter-than-normal conditions from the northern Cascades to western North Dakota.




This Week's Drought Summary (5/2)

During the late week and weekend, a large severe weather outbreak brought large hail, damaging winds and numerous intense tornadoes to parts...