In The Grain Feed, Jim Matthews is joined by a rotating cast of analysts to discuss what dairy and livestock producers can be doing to manage their risk. Questions or comments? Topics you’d like to see discussed? Contact us at Insights@Ever.Ag or give us a call at (312) 492-4200.
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Transcript (Auto-generated):
JIM – 00:00:09:09 – 00:00:37:25
Hello and welcome to another edition of the Grain Feed brought to you by Ever.Ag. This is your weekly news feed for all things grain and all things feed. Each week we bring you updates on the markets with unique perspectives from amazing team of analysts with the intention of helping dairy and livestock producers manage your risk. I’m your host, Jim MATTHEWS, reporting from the Chicago office, where we got a brief few minutes of rainfall yesterday.
JIM – 00:00:37:25 – 00:01:03:24
Very exciting stuff for us in Illinois over the past few weeks. And we will get to more of that in a minute. For now, we will have a special feature today that we will get to. Director of food Procurement Jake Kingsley is conducting a special interview with members of the Dairy consortium in Clovis, New Mexico, representing our nation’s dairy leaders, our young dairy farmers.
JIM – 00:01:03:27 – 00:01:29:12
We’re looking forward to hearing what Jake and those future leaders have to say. But first page, if you would kindly timestamp the broadcast, It is Thursday morning. Markets are trying to anticipate tomorrow’s wild report. That’s the monthly USDA supply and demand report. So we are recording currently on Thursday morning. That will come out Friday morning at 11:00 Central time.
JIM – 00:01:29:12 – 00:01:54:04
So depending on when you are viewing this video that those numbers might have come out already or about two. So just looking at the market’s real quick snapshot and where we are at the moment, December corn had been nicely elevated back up towards 550 to start this week. That, as I referenced, was based on the dryness we’ve been seeing here across the bulk of the ice states in the heartland of the US.
JIM – 00:01:54:07 – 00:02:18:00
It has been considerably dry across Illinois and Indiana, for example. We saw some of those crop conditions on Monday afternoon’s mass crop progress and condition report come out. Not so hot in terms of those conditions for a couple of the ice states. The good to excellent ratings that we watched very closely, not nearly as high as some of the similar weeks in previous years.
JIM – 00:02:18:00 – 00:02:39:02
So we’re watching this very closely. If we do not get this much needed rain between now and, let’s say Independence Day, we’re going to continue to potentially take some yields off of this corn crop in the U.S. So anticipating that, we’ve seen futures run up towards 550, but it looks like weather forecasts might have a line towards slightly wetter next week.
JIM – 00:02:39:02 – 00:03:03:20
I’m not a meteorologist just pointing out the facts of the forecast for the next week or so, but it’s done enough to at least bring December corn futures back towards 525. So we’re very much in this choppy, somewhat volatile weather market, even though it is only the first week of June. We usually talk this way once we’re past the 4th of July, it’s the first week of June, very much trading a weather market.
JIM – 00:03:03:27 – 00:03:33:27
So please be cautious of this volatility and choppy trading that we are seeing. Tomorrow’s widely report will potentially impact the markets further depending on any changes the USDA makes. We’ll be focusing on any changes to the old crop balance sheet, specifically if we revise U.S. corn exports or ethanol demand to impact ending stocks, which then comes in and impacts the carryover or carrying to the new crop balance sheet.
JIM – 00:03:33:29 – 00:04:07:17
Right now, we’re also watching that stubborn little byproduct protein. Soybean meal futures have finally continued to push their way all the way down to 365. And the December contract was slightly below as we record at the moment. Again, we’ve been anticipate waiting or hoping for this longer term pressure from that stubborn little byproduct. We’re finally seeing it. And we would note that now is as good a time as ever to step into a potential hedge or purchase on some of your new crop protein needs.
JIM – 00:04:07:19 – 00:04:40:02
Since we have not seen December meal futures at this level for quite some time for this contract. It’s been since last July. We look back to the November, late November, early December. EPA decision to release that draft proposal in which they somewhat altered the incentives to blend biodiesel and renewable diesel and utilizing soybean oil for that blending. After that report, along with Argentine dryness, we saw protein run up very substantially.
JIM – 00:04:40:02 – 00:05:02:00
So to bring us back to where we were before then is a good time to potentially step in to some cash purchases and or hedges at these levels. Enough of me talking to myself. I feel like I’m at home, really, but enough of me speaking to myself. Let’s take a look at what Jake has to say during his interview.
JIM – 00:05:02:00 – 00:05:15:14
He’s done an awesome job on the road this week in Texas and New Mexico. He and I were on the road last week together in Arizona, so he’s all over the place down there in that part of the world. So let’s take a look at what he and our future dairy leaders have to say.
JAKE – 00:05:15:19 – 00:05:38:05
Good afternoon. We are here at Dairy Consortium in Clovis, New Mexico. I’m here with a handful of the student participants here for the 2023 class. You guys are in the financial group. Once you introduce yourselves, where you’re from and your role on the dairy.
KYLE – 00:05:38:07 – 00:05:55:23
I am Kyle Barnes. I’m from upstate New York. I graduated from Virginia Tech with a bachelor’s degree in dairy science, and I have a farm that I really take care of. The calves do some hard work, and I’m going to be doing some financial work when I get home.
TRAVIS – 00:05:55:25 – 00:06:09:12
My name is Travis Pirtle. I’m from in New Mexico. I work at a dairy farm with my dad, just doing all all everything I can. I mostly look at the feed part of it.
BRAEDON – 00:06:09:14 – 00:06:30:14
My name is Braedon Van Berkum. I grew up in Linden, Washington on a 650 cow dairy. I’m currently going to school at Texas Tech for agricultural, economic, as well as working on dairy in the Panhandle. I mainly focus currently on the mechanical side of things, but I’m hoping to move more into finance and herdsmen ship role in the future.
DIRK – 00:06:30:17 – 00:06:49:15
My name’s Dirk de Boer. I’m from North East Texas. We have two days. We’re making 2300. My role over there is more. Keep my dad on his toes and telling what needs to get, what needs to happen and I’ll work it. I’m currently going to Tarleton. I work at two days over in Stephenville and I’m going in for ag business and business management.
JAKE – 00:06:49:22 – 00:07:08:12
All right. So we’ve got the dairy industry a little well represented here, a few different parts of the country and a few different paths through your educational careers, I guess. Let’s start back over here. What’s something you’re looking forward to in the future of the industry as you come out of school and get ready, go back to the dairy?
KYLE – 00:07:08:14 – 00:07:26:02
I guess I just I’m very optimistic about the dairy industry. I think cheese is a really great product that we’ve been able to provide to the public and I think it’s going to make sure we keep moving in a strong direction. So I guess I just look forward to being able to continue to provide that to everybody.
TRAVIS – 00:07:26:04 – 00:07:45:01
I’m looking forward towards the automation part of it, where labor, where it’s at, and if you can find places where a machine or a computer can do the job of a guy, that that machine is going to show up every day. It may have problems, but you know, it’s there and you won’t have to be retraining people every time someone decides to quit.
BRAEDON – 00:07:45:03 – 00:08:13:06
Yeah, I’m come on the same page as Travis here with that, where technology is one of those areas on the dairy that I think we can continue to see major improvements every year and new things come out that make dairying easier for all of us. And another thing that I’m excited about in the future of the industry is the next generation coming up and bringing some more of this knowledge that maybe playing with futures market a little bit and learning about more of the technical side and getting better in the future.
DIRK – 00:08:13:08 – 00:08:29:21
Yeah, I’m curious about technology as well, but I’m also really curious about how the dairy industry will move as a whole with with the Western states currently running closely out of water and what their plan to do is in the future.
JAKE – 00:08:29:23 – 00:08:44:23
I think you guys think so. A lot of folks are looking towards the future here. It’s good to have the future of the industry well-represented. Is there any one thing that you’re hoping to learn at consortium or maybe you already have learned that you’re going to take back home with you?
KYLE – 00:08:44:25 – 00:08:59:21
I just I really feel that I’ve learned in the last week how to manage the books for dairy. So, you know, look at all my input costs, my cost of production. And I think that’s extremely important, especially for what I want to do.
TRAVIS – 00:08:59:23 – 00:09:24:07
This is actually my second year consortium because, I mean, growing up on a dairy, I just did the stuff that I didn’t learn the science behind it. So learn the science behind why I do what I do. And then coming this year to learn more of the management part of it, running the books. My dad’s All it Is, has a weekly meeting about the finances, the futures, and so I’ve sat in on a few of those meetings, not knowing, knowing what was going on.
TRAVIS – 00:09:24:07 – 00:09:30:20
And so now I can kind of understand why he’s making some of those decisions.
BRAEDON – 00:09:30:22 – 00:09:50:16
Yeah, the one thing that I’m kind of hoping to get out of the consortium is everything. I mean, growing up on dairy, you do you see it all, but sometimes you kind of fall into a niche and you learn a lot about one thing. And this has kind of been an opportunity to learn about every area, learn about some of the opportunities that we can find in other spots of the dairy and other things that interest me on the farm as well.
DIRK – 00:09:50:19 – 00:10:06:00
So far, we’ve learned the financial side of the industry, and I’m kind of curious to go home and dive on into the books over there and see what we can do to improve our facilities at home and how we can better manage those.
JAKE – 00:10:06:02 – 00:10:24:04
Right. Good answers. There’s a lot of a lot of new technology coming online in the industry, a lot to look forward to. Sounds like financials are are a big thing for the next generation to pick up on. So good luck to you guys and hopefully we can be of service to you as you grow into your roles here.
JAKE – 00:10:24:07 – 00:10:24:26
Thank you.
JIM – 00:10:24:28 – 00:10:57:18
Certainly great insights there from Jake and our future dairy leaders. Wonderful to see the enthusiasm and some of the insights from folks from different parts of the country all come together and have a chance to learn about the dairy markets. And a big thanks to them for not only participating in that video, but for hosting ever AG and for allowing us to present our take on the dairy and grain and feed markets and how that’s impacting those dairy farms in that particular part of the country, but also across the nation.
JIM – 00:10:57:18 – 00:11:21:07
So a huge thanks to everyone who participated, a big thanks to our team for all their work today to produce this episode Jake. Well done, sir. On the road you’ll be taking over my job here as the host soon enough. I can feel it. Thank you for your insights and work. Big thanks to Corey and the Evergreen Insights Crew for their support, and thank you to Paige for her production Magic.
JIM – 00:11:21:09 – 00:11:58:19
Speaking of beverage insights for June Dairy Month Ever.Ag Insights is offering a free trial to our world class publication, so please check out the link at the bottom of the screen here for more details. We have an awesome Ever.Ag Insights portal live. Please check it out. You can see the grain feed. Of course we can. Also for these publications, View the Feed, read a lot of our top notch dairy commentary and publications, so please stay tuned by checking that out and asking for a free trial to view some of that content.
JIM – 00:11:58:22 – 00:12:11:29
With that, thank you to the viewers for watching the grain feed. Our contact information is also on the screen. We greatly appreciate your feed back. That’s all for today. We’ll see you next time on the grain feed.