Farm Bill Gets Mixed Reactions

The Farm Bill finally passed out of committee yesterday, and as usual, it is getting mixed reactions.  \r\n   Senator Debbie Stabenow (D-Mich) applauded the removal of direct payment subsidies, while some high-powered livestock and poultry lobbying groups are opposing final passage.  Opposition from the American Meat Institute, the National Cattlemen’s Beef Association, the National Chicken Council, the National Pork Producers Council, the National Turkey Federation and the North American Meat Association, expressed “deep disappointment” with the bill, a MeatingPlace.com story said. \r\n   Conspicuous by its absence is a mandatory Country-Of-Origin labeling provision that complies with World Trade Organization obligations, MeatingPlace said.  \r\n   The WTO has ruled that the current COOL law is incompatible with WTO rules and must be changed because it represents a trade barrier that is not based on science.  Canada and Mexico took the matter to the WTO and won the ruling and are threatening retaliation against US products.\r\n   But other lobbies, like the National Farmers Union, R-CALF USA and the Western Association of Resource Councils, support the COOL provisions.  They say the measure benefits family farmers and ranchers, a segment of the industry they claim is not represented by the larger lobbying organizations.\r\n   Overnight markets are mixed with wheat moving higher as concerns grow about the effect bitter cold temperatures will have on the winter wheat crop.  Many worry that unprotected fields will suffer winterkill, and that the harvest could be cut.\r\n   However, AgResource pointed out that weather conditions in India’s wheat-growing areas indicate a record harvest there that could add to their already burdensome supplies.  This would make it easier for the government to sell grain to exporters at prices that are competitive in world markets.\r\n   In addition, with Black Sea area snow cover adequate and Australian wheat now the world’s cheapest for February/March shipment, the US winterkill story may not be enough to sustain a lasting rally.\r\n   Soybean markets are beginning to feel the pinch of a Brazilian crop that is coming to export markets.  So far, there is no confirmation that Chinese buyers are cancelling US orders in favor of cheaper Brazilian beans, but the presence of what appears to be a record crop is capping rally attempts, market analysts said.\r\n   South American weather conditions also look good for corn, and while the second crop may see fewer acres planted because of low prices, it appears the world will have plenty of corn available unless there is a major drought scenario somewhere in the world.\r\n   No cash cattle trading was reported in the Plains on Monday.  Prices last week were record high, ranging from $146 per cwt on a live basis up to $150, up about $5 from the previous week\r\n   The USDA’s choice beef cutout was reported at $238.04 per cwt, up $0.78 on the day, and the select cutout was up $0.81 at $237.06.  The choice/select spread narrowed to $0.98, and there were only 68 loads of fabricated product sold into the spot market.\r\n   The CME Feeder Cattle Index for the seven days ended Friday was $171.22, up $0.88, while the Jan futures contract settled Monday at $170.97 per cwt, up $0.27.\r\n