January WASDE feed/grain report
https://www.nationalbeefwire.com/wasde-feed-grain-outlook
- The January 2020/2021 U.S. corn outlook calls for lower production, reduced corn used for ethanol, smaller feed, residual use and exports and decreased ending stocks.
- Corn production is estimated at 14.182 billion bu., down 324 million on a lower yield and slight reduction in harvested areas.
- Total corn use is down 250 million bushels to 14.575 billion.
- Exports are down 100 million bu.
- Feed and residual use is reduced 50 million bu. to 5.65 billion bu., based on indicated disappearance during the September-November quarter.
- With supply decreasing more than use, corn stocks are lowered 150 million bu. to 1.552 billion.
- The season-average corn price received by producers is raised to $4.20 bu.
- Global coarse grain production for 2020/2021 is forecast down 9.3 million tons to 1,438.5 million.
- Foreign corn production is reduced with declines for Argentina and Brazil offsetting increases for China and India.
- Dryness during December in Argentina has reduced yield prospects for early-planted corn in key central growing areas.
- Brazil is lowered reflecting reduced yield expectations for first-crop corn in southern Brazil.
January WASDE cattle and poultry report
- The 2020 total red meat and poultry production estimate is reduced from last month.
- Beef production estimate is reduced on lower cattle slaughter.
- For 2021, the total red meat and poultry production forecast is lowered from the previous month as lower expected beef, broiler and turkey production more than offsets higher pork production.
- Lower expected placements in 2020 will impact fed cattle supplies come mid-2021.
- Cattle carcass weights are forecast lighter for 2021.
- The beef import estimate for 2020 is reduced on recent trade data, and the 2021 import forecast is reduced mostly due to lower expected imports from Australia.
- Beef exports for 2020 and 2021 are increased from last month.
- Cattle prices in 2021 are expected to increase on a lower production forecast.
Small Business Administration gearing up new PPP loans
- As of Monday, January 11, farmers, livestock producers and other small business owners could start applying for the Small Business Administration’s (SBA) new Paycheck Protection Program (PPP) if they are working with smaller financial institutions.
- When SBA originally opened PPP for loans, companies connected to larger banks snatched up the majority of those funds.
- This new program has been adjusted by Congress and SBA to allow smaller, underserved businesses a better chance at receiving the loans.
- Last Friday, SBA announced that $15 billion has been set aside for new PPP applications coming from small “community financial institutions.”
- These financial institutions must be banks or credit unions with under $1 billion in assets.
- Repeat PPP borrowers can start reapplying today, January 13.
- Businesses, farmers and livestock producers can apply through their lenders for this new PPP program.
- To be eligible, farms and other businesses must employ 500 or fewer people.
- The 1 percent interest loans, which can be forgiven, can be as much as 2.5 times a company’s average monthly payroll costs – up to $10 million.
- The loan period can run from eight to 24 weeks and has some flexibility built in for farmers that hire seasonal help.
- Farms or livestock operations must have a maximum net worth of $15 million or less to be able to qualify for PPP loans and their average net income after federal income taxes for the past two years cannot be more than $5 million – excluding any carryover losses.
- Last year, about 150,000 businesses in agriculture, forestry, fishing and hunting received $8.1 billion in PPP loans.
- This accounted for roughly 1.6 percent of the entire lending under PPP, which ended up reaching $525 billion when it was all said and done.
- These financial institutions must be banks or credit unions with under $1 billion in assets.
Boxed beef prices
- Choice boxed beef: $209.14 (+1.45)
- Select boxed beef: $198.09 (+2.35)