Evening Report | July 29, 2021

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Drought worsens for the Northern Plains and Upper Midwest… USDA’s U.S. Drought Monitor for the week ended July 27 showed ongoing deterioration in western and northern areas of the Corn Belt, with little change in the eastern Belt outside of some drought improvement in northern Wisconsin and central Michigan.

Today’s summary update says, “Another round of blistering heat across the Northern Plains further stressed rangeland, pastures, and a variety of summer crops. The Central and Southern Plains also experienced some hot weather, although agricultural impacts were tempered by mostly adequate soil moisture reserves.”

Dry weather covered much of the Midwest, as has been the trend since mid-July. “Short-term dryness was not yet a concern in the previously well-watered lower Midwest. However, reproductive corn and soybeans in drier areas of the upper Midwest were subjected to increasing levels of stress, especially as temperatures began to rise,” today’s update notes. Extreme (D3) drought coverage was added to Minnesota and severe (D2) drought expanded in Iowa. Find related maps here.

IGC: Little year-to-year change in global grain stocks expected… The International Grains Council (IGC) lowered its 2021-22 total grains production estimate by 6 MMT, citing drought-reduced crops in North America, including wheat, barley and oats. IGC trimmed use 4 MMT, but at 2.295 billion MT, consumption would still be a record and a 3% year-over-year gain. IGC reports an upward revision for corn only partially made up for declines in wheat and barley stocks, resulting in a 3-MMT drop in grain carryover supplies that are now projected at 594 MMT, up just 1 MMT from the year prior.

IGC also lowered its 2020-21 global soybean export projection by 4 MMT to 168 MMT, reflecting smaller-than-expected shipments from South American origins in recent months. It also trimmed global soybean production marginally for 2021-22, but the rise in beginning stocks helped to boost IGC’s carryover projection slightly to 54 MMT, up 5 MMT from the previous season.

Direct forgiveness offered for small PPP loans… Paycheck Protection Program (PPP) borrowers with loans of $150,000 or less will be able to directly apply to the Small Business Administration for forgiveness, instead of going through their lender. The interim final rule, released by the agency yesterday, allows lenders to opt into the alternative method for processing PPP loans, reducing burdens on lenders to service forgiveness applications.

USDA to unveil $67 million to new program for heirs’ property owners… USDA today announced $67 million in funding for owners of heirs’ property, aiming to address a leading cause of land loss among Black and low-income farmers. The money will be distributed through the agency’s new Heirs’ Property Relending Program (HPRP) that Congress directed USDA to create in the 2018 Farm Bill.

USDA releases economic analysis of the U.S. biobased products industry… Today, USDA unveiled an economic impact analysis of the U.S. biobased products industry report, showing that the biobased industry “is a substantial generator of economic activity and jobs, and that it has a significant positive impact on the environment.” The one-page report shows that in 2017, the biobased products industry:

• Supported 4.6 million American jobs through direct, indirect and induced contributions.
• Contributed $470 billion to the U.S. economy.
• Generated 2.79 jobs in other sectors of the economy for every biobased job.
• Displaced approximately 9.4 million barrels of oil annually.
• Could reduce greenhouse gas emissions by an estimated 12.7 million metric tons of CO2 equivalents per year.

Biden to nominate Jacobs-Young as agriculture undersecretary… President Joe Biden on Wednesday announced his intention to nominate Chavonda Jacobs-Young as Agriculture undersecretary for research, education and economics. Jacobs-Young is administrator of the USDA Agricultural Research Service and serves as acting undersecretary for research, education and economics and acting USDA chief scientist. She is the first woman and person of color to lead this division of USDA, which manages an annual budget of $1.82 billion, the White House said.

Pilgrim’s Pride executives indicted for chicken price fixing… A U.S. federal grand jury has indicted four current and former executives at Pilgrim’s Pride Corp. for their roles in a price fixing conspiracy for chicken products, the Department of Justice said today. The Illinois chicken company Koch Foods was also indicted for its alleged role in conspiring to fix prices for broiler chicken products. In February, Pilgrim’s Pride pleaded guilty to the price fixing charges and was sentenced to pay a fine of nearly $108 million.

An outspoken Chinese agricultural industrialist has been sentenced to 18 years in prison… The conviction of Sun Dawu for allegedly causing public disorder and other offenses has highlighted the growing political risks for private businesses in China as President Xi Jinping focuses on strengthening the Communist Party's control over the economy. Sun, 67 years old, who founded Dawu Agricultural and Animal Husbandry Group, had been feuding with government officials in a land dispute. He had gained prominence as a voice speaking up for farmers and rural businesses. "Is it dangerous when private businesses grow big? Is it not dangerous when state-run enterprises grow big?" he told the court, according to a transcript provided by the defense team.