Agriculture news

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BASF & PowerPollen collab to research hybrid wheat

BASF and PowerPollen announced an agreement to further develop and apply PowerPollen’s patented pollen preservation and application technology to improve cross-pollination and enhance BASF’s proprietary wheat program.

BASF is developing new hybrid wheat varieties to improve yield, quality, and stability to meet the agronomic and economic needs of growers and the value chain, and the nutritional needs of a growing world population. Through hybridization and advanced breeding platforms, hybrid wheat delivers leading performance and seed quality with value-added traits that can be tailored to local growing conditions.

The PowerPollen technology, already proven in corn applications, has the potential to collect, preserve and apply wheat pollen at a commercial scale, which would dramatically increase pollination efficiency for BASF’s hybrid wheat seed production.

“Hybrid wheat demonstrates BASF’s commitment to transforming wheat for long-term success through a globally-driven, advanced breeding platform adapted to local needs and supported by a continuous pipeline of innovation,” said Gustavo Gonzalez, Director of Global Wheat Crop Strategy for BASF. “This collaboration will leverage PowerPollen’s unique expertise in solving pollen preservation and application in corn to improve hybrid wheat seed production.”

Commercial-scale hybrid wheat has been the goal of wheat breeders and seed companies since the 1950s. The addition of PowerPollen’s preservation and application technology expands the potential for hybrid wheat and improved productivity and profitability for wheat farmers.

“We are excited to develop our technology in collaboration with BASF, whose industry-leading wheat and traits research platform shows incredible opportunities for hybrid wheat,” said Dr. Todd Krone, co-founder and CEO of PowerPollen. “When applied to commercial hybrid seed corn production, PowerPollen’s technology increases yields and enables production of hybrids that conventional methods are unable to produce. The goal is to achieve similar results in wheat to accelerate hybridization of this staple crop.”

The financial terms of the agreement were not disclosed.

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Rural recovery hinges on virus control & consumer confidence

Rural industries are grappling with how to adjust their businesses to remain relevant and sustainable in the face of the coronavirus pandemic. Agricultural supply chains have been massively disrupted and lost revenue. Water and power suppliers have adapted as commercial customers went dark and demand shifted to residential customers.

According to a new Quarterly report from CoBank’s Knowledge Exchange, the recent rebound in the U.S. economy is real, but the sharpest post-shutdown economic gains are almost certainly behind us and a long grind to shore up a shaky economy lies ahead.

“Economic data prior to the recent resurgence of coronavirus cases has shown a consistent, steady improvement in the U.S. economy, coinciding with business re-openings,” said Dan Kowalski, vice president of CoBank’s Knowledge Exchange division. “But traditional economic data can go stale remarkably fast in the COVID era, making high-frequency economic indicators an essential tool. And those indicators are signaling a plateau, followed by a possible downshift in the economy.”

Despite COVID-19, U.S. grain has been moving and basis has generally tightened since April 1. Wheat export activity has been strong and domestic demand has been healthy, as home-bound consumers buy more packaged food. China has been buying U.S. grain, although the run rate is below the levels agreed upon in phase one of the trade deal. Sorghum exports to China have been especially robust; sorghum basis has tightened meaningfully in response to strong export demand.

Farm supply retailers benefited from a healthy spring agronomy season and are well-positioned for the remainder of the growing season. Crop progress has been above average amidst favorable weather. USDA rated around 70% of corn, soybean, and spring wheat crops as good-to-excellent in its June 29 report. A surprise ruling against dicamba could have long-term implications for crop protection sales and advice.

Ethanol production and margins began to recover during the second quarter as U.S. economies began to reopen. However, coronavirus is resurging in several states and renewed activity restrictions will potentially reduce driving and fuel demand. Looking ahead to 2021, ethanol fuel demand may recover to only 85 percent to 90 percent of pre-COVID levels.

U.S. chicken plants endured far less COVID-19 disruption in the second quarter than beef or pork. The chicken sector swiftly filled retail meat cases when demand shifted from foodservice and the red meat supply dropped. While chicken producers have been able to manage through their production disruptions, demand and prices have been volatile. CoBank analysts expect around 3% industry growth for the sector in 2020 as its value-proposition may appeal to U.S. consumers facing a difficult economic outlook.

Beef packing plant capacity fell to historic lows in late April, spiking the cutout value to record highs. Beef production and prices have now returned to pre-pandemic levels. Concern within the beef sector is now shifting from supply to demand. Food service traffic has improved, but many social distancing restrictions remain. This means ongoing challenges for the dine-in, full-service sector, which especially hurts the beef complex.

The pork industry has rebounded from a supply chain shock that saw U.S. production fall by nearly half, before climbing back to above prior-year levels two months later. Pork production in the last week of the quarter was up more than 10% above the same week a year ago as the industry is beginning to work through the backlog of hogs. Second quarter pork exports remained strong.

Dairy producers and processors struggled through extreme market volatility last quarter due to COVID-19. Milk, cheese, and butter prices fell to multi-year lows on steep losses in food service demand and record milk production. Cheddar block prices bounced to record highs on restaurant restocking, high demand from pizza chains, and government purchases. Milk and butter prices also recovered. Although, many farmers did not benefit from higher milk prices last quarter because of negative producer price differentials.

China took the headlines in cotton as the standout overseas buyer for the quarter, helping lift cotton prices from the multi-year lows in March and early April. As China strives to fulfill phase one commitments, its imports of U.S. upland cotton at the end of June were up 50% over last year’s pace, and outstanding sales of unshipped cotton more than quadrupled year-over-year.

COVID-19 continues to snarl supply chain logistics with specialty crops growers fearing further losses in food service demand as the pandemic resurges. Growers that have contracts with grocers and retailers have fared better. Domestic demand for tree nuts like almonds, walnuts, and pistachios has been robust as consumers stockpile shelf-stable foods. Another record large almond crop is expected as harvest begins in the weeks ahead, putting greater focus on the U.S. tree nut export program.

Most rural telecommunications operators signed the FCC’s Keep Americans Connected pledge, which includes not disconnecting service for customers that who cannot pay their bill due to COVID-19-related economic stress. Offering free service has strained rural operators’ cash flow, which could impact future network build plans.

The U.S. energy sector is used to volatility in supply, but not profound changes in demand. For the first full month of COVID-19 stay-at-home advisories, April data shows U.S. electricity system peak demand levels hit 12-month record-setting lows, with net electricity generation decreasing 6.7% year-over-year. Demand recovery to pre-pandemic levels will be slow and the longer road to recovery makes it more likely that structural change is inevitable.

The full Quarterly report is available on cobank.com. Each CoBank Quarterly provides updates and an outlook for the Global and U.S. Economic Environment; U.S. Agricultural Markets; Grains, Biofuels and Farm Supply; Animal Protein; Dairy; Other Crops; Specialty Crops and Rural Infrastructure Industries.

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Dairy leaders worry whole milk could be banned in schools

This week the American Dairy Coalition sent a letter to Secretary Sonny Perdue of the U.S Department of Agriculture and Secretary Alex Azar of the U.S. Department of Health and Human Services requesting they look into concerns farmers have with the draft of the Dietary Guidelines for America.

The Dietary Guidelines for America, which is updated every 5 years, sets our nation’s leading nutrition policies and directly influences WIC, SNAP, as well as school and hospital nutrition programs across the nation. Despite an abundance of science that demonstrate that full-fat dairy products reduce chronic disease in children and adults and promotes learning readiness in children, the DGA continue to set caps on saturated fats, effectively banning whole milk from daycares and school nutrition programs.

ADC’s letter encourages Azar and Perdue to intervene and delay the publication of the DGA so it can be updated to include the most recent scientific evidence on the health benefits of saturated fats. Furthermore, the dairy coalition requests the USDA and HHS to review and address the process by which these Dietary Guidelines are written. In 2015, Congress commissioned the National Academy of Sciences, Engineering and Medicine to conduct a third-party review of the DGA process at a cost of $1 million of taxpayer dollars. ADC wants to understand why nearly all of the recommendations offered in the NASEM report were ignored.

In the 40 years since the implementation of the Dietary Guidelines for America Program, childhood obesity and diabetes diagnoses have tripled; adult obesity rates have doubled, and 25 million adult Americans have diabetes. The current guidelines are not working. Americans deserve sound science and we cannot wait another 5 years to get it right.

In the letter, Laurie Fischer, CEO of the American Dairy Coalition, said, “The American Dairy Coalition and the dairy producers we represent, support the choice of offering whole milk in all daycare and school nutrition programs. Science concludes that full-fat dairy products not only improve nutrition, but also learning readiness, especially for those most nutritionally at-risk.”

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Burger King’s new ad is blowing up in the ag community — and not in a good way

Burger King claims that its new ad, which has now been posted across its social media networks, is an effort to improve the environmental impact of beef. What it does is make beef production as we know it today to be a villain — all to the tune of a cutesy, colorful video that talks about “cow farts” and methane release. What Burger King doesn’t tell you is that farmers and ranchers have already long been improving per-unit methane emissions from livestock, which has been in marked decline since 1990, while livestock producers have also increased productivity.

But that would clash with BK trying to show that it’s wanting to be “squeaky clean” — even as its young cowboy-clad guitarist begins the video coming out of the hindquarters of a cow:

Some companies simply never learn when it comes to using children to bash a competing product or to deceptively market a concept. The tactic backfired spectacularly two years ago when Stonyfield tried it, causing the food company to expend countless resources doing online damage control.

In its ad, Burger King’s central point is to say that it will change its cattle’s diet by adding lemongrass to reduce their emissions by approximately 33 percent. But, after Ermias Kebreab, an Associate Dean at the University of California-Davis, came onto Twitter to cast doubt on the fast-food giant’s ad, people were really left scratching their heads as to why BK would pull the trigger on this campaign.

Overall, while reducing emissions is a great thing (of course!), the fact that the video ad makes current agricultural practices sound sinister is what has agitated many in the ag community:

And then there was this reaction to one of Burger King’s followup tweets:

Agriculture’s contribution to total U.S. greenhouse gas emissions is about 10 percent (globally, it’s 4 percent) — and even that doesn’t show how negligible ag’s impact is compared with the bigger picture. (Note that greenhouse gas mostly implies carbon dioxide, but also methane, nitrous oxides, and some refrigerants.) And beef producers in the U.S. already have one of the lowest carbon footprints compared to many of their worldwide counterparts. 

As far as improving one’s climate footprint, Burger King’s efforts aren’t going to make as big of an impact as they’re claiming (it’s all style and no substance), and the resources the company is putting into this ad campaign could be far better spent elsewhere improving the environment. Farmers and ranchers are already working hard year over year making their impact smaller, their production greater, and their efficiency better.

Of course, the solution that many in ag are offering up is to simply never eat at Burger King again.

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