The Rural Voice, 1983-04, Page 24by John DePutter. Please note: This
was prepared on March 17, 1983
OMINOUS WEATHER IN SOUTHERN
HEMISPHERE: What may be the worst
drought of this century in Southern
Africa is spreading into other parts of
that continent. During March. some rain
fell in parts of the drought -stricken
area. but it was not enough to boost
the withered white corn crop. South
Africa, the largest white corn producing
nation, may as a result have to import
corn this year. Some scientists warned
recently that the severe drought may be
spreading to other parts of the world
over the next two years. It is already in
Australia. If that is to be the case,
today's over abundance of grain could
disappear.
PAYMENT IN KIND SIGN-UP APPEARS
LARGE FOR CORN: At time of writing,
private surveys point to strong partici-
pation in USDA's program to cut pro-
duction. One survey, by Dekalb, said
corn acreage may be down 28% from
last year, with soybean acreage down
8%. Another survey, by Agristar, said
that about 85% of the larger acreage
corn producers will participate in the
PIK program. Winter wheat growers,
however, may be less anxious to reduce
production, because the crop is already
in the ground. "I have a natural concern
for the winter wheat," admitted Agricul-
ture Secretary John Block. "I know it
tears you apart, having to go out there
and not harvest a good crop." Corn
markets already have much of the PIK
enthusiasm built into prices, as De-
cember futures are hugging the $3.00
area. Wheat prices on the other hand
are still weak, with July futures at
The world is getting smaller every day
and international events can influence
decisions you make about your farm
business. In this monthly column John
DePutter will be alerting Rural Voice
readers to trends which could affect the
farming community.
FARM MARKET PERSPECTIVE
$3.56. American market services recent-
ly contacted were generally willing to
continue storing a portion of old crop
corn where possible, in case of higher
levels yet. The idea of selling 10 to 25%
of expected new crop corn production
was a commonly expressed notion.
U.S. MILK PRODUCTION STILL GROW-
ING OUT OF CONTROL... Unfortunately
for an already depressed world dairy
market. U.S. producers are still milking
the government for all it is worth. Uncle
Sam buys about 1 in every 10 pounds of
milk produced, to support the industry.
In February, production was up 2% over
the same period a year ago. Number of
milk cows rose too. A government plan
to discourage overproduction by impos-
ing penalties is held up in court. Here
in Ontario, meanwhile, high quota
prices are being taken advantage of by
some farmers who are ready to retire.
The market clearing price for group 1
pool quota in March was down to $178,
after being around the $200 mark
earlier.
SOYBEANS: PATIENCE, PATIENCE...
Many market experts suggest that pro-
ducers may have to wait awhile, but
better soya prices will eventually come.
David Bartholomew of Merrill Lynch in
Chicago said beans were trading along
the low side of a channel, and pricing
should be delayed until they trade at or
above the highs made in recent weeks
and months. Alan Peiper, of Doane -
Western, said in an interview that the
cut in soybean acreage in the U.S. this
year should boost summer prices. Ano-
ther firm was prepared to delay any old
crop or new crop pricing (unless the
money is needed for cash flow) until
better levels come. Until then, a huge
Brazil crop of 15 million metric tons, or
more could weigh on prices (although a
20 cent rally is being seen at time of
writing).
WESTERN VIEWPOINT ON BARLEY:
Prairie farmers will boost rapeseed
acreage by as much as 40% this year,
according to Lynn Malmberg, a farmer
and market analyst from Alberta. But
this does not mean barley will be in
short supply, he said, because there is
a large carryover to be dealt with.
OPEC PACT MAY NOT LAST: Analysts
are uncertain as to whether OPEC oil
ministers can hang on to the $29
official benchmark price and the output
limit of 17.5 million barrels a day.
Whether they can or can't, we are out of
the era of skyrocketing energy costs.
We have swung into a period in which
the "oil importing nations will benefit at
the expense of the exporting countries,"
said Richard Dowd, a Commodity Spe-
cialist with Merrill Lynch in Chicago.
KEEP SELLING THOSE HOGS, BOYS!
A U.S. market letter had an interesting
tidbit in its March issue. If we may
steal the line from PorkPro, published
in Iowa, it said "the U.S. Meat Export
Federation will send a pork study team
to Japan at the end of March to look
into expanding that market further. The
Japanese are among the largest pork
importers in the world and an important
market for the U.S. to tap." .... Seems
we Canadians will have to be good
merchandisers to stay in competition
with U.S. salesmen.
THERE IS FEAR IN THE HEARTS OF
PORK PRODUCERS! Maybe they are so
afraid of overexpansion that they will
not expand! Here in Ontario, sow
slaughter in 1982 was down 121/2%, and
that evidence of increased breeding
plus other recent signs, was enough to
prompt the Ontario Pork Producers
Marketing Board to warn against over-
production,
BUT THERE ARE SOME AMERICAN
ANALYSTS WHO are not scared. Marlys
Miller, hog specialist for Profarmer in
Iowa, said in an interview prior to the
March 21st USDA hogs and pigs report
that large expansion is not occurring.
She believes that hog numbers were
greater than expected during February
and March, because a mild winter got
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at
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Time 10:30 a.m.
Free coffee Lunch Booth
DEA
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Farm Equipment
Hwl. 86 West. Lucknow
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PG. 22 THE RURAL VOICE, APRIL 1983