Freezing temps drive cattle higher
Predictions of the lowest January temps in 10 years in the Midwest helped cattle leap a massive seven cents per pound on the week as cold temps threaten the animals’ health.
Unlike poultry, hogs or dairy cows, which nowadays are fed inside heated buildings, cattle are vulnerable to the effects of bad weather or cold temperatures outside. Much of their food is used just to keep them warm so their weight gain is reduced. Cattle futures rose to their highest prices in nine months, so beef prices at the grocery could be chilling to shoppers as well.
Upcoming farm issues are no exAGgeration
The U.S. Department of Agriculture has an annual budget of just more than $200 billion dollars and employs close to 100,000 people. Its largest expense is its nutrition programs including the Supplemental Nutrition Assistance Program and its program for Women and Children. Many other jobs include promotion, regulation and subsidies for the U.S. agriculture sector.
Brooke Rollins, the likely incoming agriculture secretary, lists acting director of the Domestic Policy Council of the United States under President Trump among her past positions. She is currently president and CEO of the America First Policy Institute, a conservative think tank that promotes President-elect Trump’s economic policies.
Rollins will be faced with the likely issue of increased tariffs, which negatively affected agriculture in the first Trump administration. She also inherits the dangerous strain of the bird flu virus and cow screw worm. Sources indicate that she has criticized expansion of food stamp benefits and is a proponent of fossil fuel use.
She is likely to bump heads with Robert F. Kennedy Jr. who as head of Health and Human Services could advocate for changes unpopular to the farm community. Both Newt Gingrich and Sarah Huckabee Sanders have recently endorsed Rollins, an ag major raised on a farm.
Ukraine turns off Russian nat gas pipeline
Ukraine ended its natural gas pipeline agreement with Russia Wednesday. The pipeline had once supplied the EU with 35% of its natural gas. In recent years, the EU has vastly diversified its gas supplies using liquified natural gas from the US as well as a pipeline from Norway. Estimates indicate that only 8% of EU gas is supplied by Russia today.
The move, which many say is symbolic, will cost Russian gas company, Gazprom, $5 billion annually while Ukraine stands to lose up to a $1 billion each year in supply line fees. Countries affected most by the cut-off include Austria, Slovakia and especially Moldova, which depends on Russian gas enough that it has declared a national emergency.
In retaliation, Russia has targeted Ukraine civilians and energy infrastructure as cold weather embraces the area.
Meanwhile, a frigid blast of arctic air will plunge temperatures across the eastern half to two-thirds of the U.S. calling for increases in natural gas usage.
CME midday prices: Price per bushel: March soybeans, $9.93; March corn, $4.52; March wheat, $5.31. February livestock per 100 pounds: Cattle, $195.50; hogs, $79.80. Metals per troy ounce: February gold, $2,659; March silver, $30.28. March copper per pound: $4.07. February crude oil per barrel: $73.70. February natural gas $3.35 per 10,000 MMBTU.
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