CHS 2015 Grain Marketing Seminar

I was recently invited to speak at CHS Midwest Cooperatives Grain Marketing Seminar, January 2015. A big thanks to them for having me and providing the video. They put on a really informative conference and you can see more of what was presented HERE.

Logistical Problems In South America

Below is a small story Reuters ran recently, which may just be the start of more South American complications hitting the headlines in the days ahead:

(Reuters) January 27th, 2015 – A key waterway in Brazil used to transport grains, pulp and other bulk goods will not reopen, as planned, for the start of soy exporting season, the Sao Paulo state government said on Tuesday.
The Tiete-Parana waterway has been closed since May, and rains in January, usually the rainiest month in southeastern Brazil, have not raised the draft enough for barges to pass.
The closure shows the growing economic impact of the climate crisis in a region responsible for 60 percent of Brazil’s gross domestic product, and economists are considering the impact of potential energy rationing as water levels drop in reservoirs that feed hydro-electric dams. Continue reading

Downplaying The Dollar

US Fed seems to take on a more “dovish” tone as many insiders believe they are now trying to talk down the strength in the US dollar. I thought it was interesting to hear both Ray Dalio, one of the largest US hedge fund managers and Goldman Sachs President, Gary Cohn, recently talking about the problems and fears stemming from a renewed “currency war.” In other words the global trend of “purposeful currency devaluation” is starting create more economic headwinds and complications. Many believe this process escalated when Japanese Prime Minister Shinzo Abe started pushing down the yen’s rate two years ago. After that, Europeans felt the pinch and started devaluing the euro. Other central banks around the world followed suit and have been cutting rates and weakening their currencies as well. Now the ball is back in Japan’s court again, and as Dalio says, “the US is just sitting here watching, being the one country whose currency is rallying because everyone else is trying to devalue.” Continue reading

The Success of America’s Farmers

I was recently made aware of a wonderful phrase inscribed into the facade of Union Station in Washington DC. The phrase eloquently reminds us of what agricultural has meant to America. I say, “meant” because these words were inscribed on the building when it was built at the turn of the 20th century. The inscription reads: “The farm – best home of the family, main source of national wealth, foundation of civilized society, the natural providence.” Continue reading

KC Fed Seeing Increased Farmer Borrowing

The Federal Reserve Bank of Kansas City was quoted in a recent report as saying, “Reduced profits in the crop sector persisted in the fourth quarter of 2014, leading to a sharp rise in farm-sector borrowing and a slight decline in cropland values. A near-record fall harvest pushed crop prices to their lowest levels in five years, eroding profit margins and prompting a rise in loan volumes to finance short-term operating expenses. Farmland markets also cooled amid prospects of lower farm income, particularly in heavy crop-production areas. Should low crop prices and high input costs persist, crop sector profit margins may weaken further and strain loan repayment capacity in the coming year.” Read the entire report HERE.

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