 Well good afternoon and welcome to this week's agricultural market situation outlook. We're continuing to provide this series of webinars as we continue to work through the COVID situation as it's affecting the agricultural economy and the state of North Dakota. And we'll begin with Brian Parman. Yep good afternoon everyone. We're back again with our webinar series and I'm gonna talk about some of the stuff that I've been tracking now for several weeks as the new numbers come out. I try to present them and digest them as best I can. So the weekly unemployment numbers came out again and one bit of good news on this I put a trend line to it a moving average trend line that you can see that's the red dotted line there. And after peaking there at the very end of March the first week in April the trend is moving downwards which is a good sign. However as you can see even even though this last week's the week ending Saturday even though it was just shy of three million that's still historically high. So while the numbers that we're adding week over week are declining they're still from a historical perspective very very high. Will this downward trend continue? I hope so but the but the thing is we've already added you know well over 30 30 plus million people to the to the unemployment payrolls in just such a very short time and and the bulk of it coming from just a few industries mainly that I think we've gotten through the backlog of folks who were unable to file claims so we're not going to see this sharp increase due to an influx of folks who finally got through. But to put into perspective how how large a number this is is just about impossible because there really isn't any historical precedent for it. And my next slide I wanted to show where these just exactly how this kind of shakes out and this is from the Bureau of Labor Statistics seasonally adjusted unemployment and if you look at the right hand column that's you see this is in thousands so that'd be 14.283 million people have been unemployed for less than five weeks so that's that new that's that's represented in that that big those large numbers few weeks and then the five to 14 week people you can see that jumped from March of about one point almost one point eight million one point seven nine four to seven. So the folks who had to file early got transferred into this five to 14 week and the folks who've been unemployed in the last month or so they're in that 14.2 million. Now we haven't had an increase in the long term yet but that's simply because these numbers haven't been out long enough and those folks haven't been unemployed long enough to be in the long term and that was actually doing really well leading into this the 15 to 6 to 26 week unemployed had been stable the 27 weeks and over had been pretty stable and actually declined in April but I expect that those numbers as time progresses are probably going to going to grow and you can see the average duration on the on the right-hand side it shows the average duration of people in weeks how long they've been unemployed 6.1 if you go back to April 2019 which is the very far left hand column at the bottom it's 22.8 so people short-term unemployed back in April of nine employed wound up finding jobs relatively quickly and all of a sudden you had this big influx so that's why that average has dropped so so dramatically and the median duration in weeks is 2 so just showing how fast and how hard this hit so my next slide just shows something kind of interesting that I wanted to highlight on and if you look at the very top row all the way on the right this is weekly according to the BLS Bureau Labor Statistics so the average weekly earnings is a thousand and twenty six dollars per week in April it was 977 bucks so it literally went up now why did it go up that's because all of the lower income folks which who tend to work in hospitality and food service and barbershops and these other things they became unemployed so their weekly earnings weren't counted so you you can kind of glean from this what group of workers in the US were most heavily affected by what's going on with this and it shouldn't be a surprise to anyone but these are just some numbers here that are breaking out exactly what's happening you drop down to the bottom of this table the last row near the bottom leisure and hospitality average earnings went from four hundred and eight dollars to four hundred and thirty five why did they go up down because the lower income folks actually dropped out of the average for this so I want to shift gears now and go to my next slide where the numbers from April came out from the BLS the consumer price index for selected things prices that consumers are paying and I pulled exactly four out of out of the numbers that came out just to highlight so what we had here you can see the purple line is ground beef and a sharp spike in ground beef in April the kind of green colored line is eggs a big spike in egg prices in April going going up from about two dollars a dozen on average up to three dollars so literally a 50% increase there you have chicken that increased chicken and poultry increased in price and bread increased a little it's kind of hard to see it's that light blue line down there it increased a little bit but not a whole lot so when you're thinking about consumers making budgetary choices and trying to have especially budget budget constrained consumers folks who may have lost their job or maybe you didn't lose your job but you're concerned about it you're concerned about your financial well-being in the future you might start making trade-offs looking at yes eggs increased in price but I showed a chart a while back quite a while ago that showed the calories per dollar and even if eggs go up to three dollars four dollars a dozen they're still far cheaper in terms of protein and calories per dollar spent than things like beef and poultry and everything else some of these items from this consumer price index change so food went up three and a half percent in the month of April which is a record for one month since the 70s food at home went up four point one percent and food away from home went up two point eight percent in cost so eating out went up in cost but not nearly as much as groceries purchased so literally the price of groceries went up one big area where they found that prices declined gasoline declined by 32% in the month for the month of April energy in general down 17.7% clothing down almost 6% and interestingly medical care was up 6% in the month of April but that had virtually nothing to do with COVID it's been up 5% month over month every month since about September so I think that that's going to increase even further into the future I just don't think the medical care portion has actually caught up to us yet but it's something to think about that already our rising healthcare costs and this certainly isn't gonna make matters any better so some retail numbers actually came out today and they are poor to say the least clothing retail down 21.6% from a year ago JC Penney is filing for bankruptcy if not today if they haven't already done it this weekend and they're closing 180 to 200 stores out of 865 and they employ about 90,000 people that's a lot of permanently lost jobs Pier 1 imports for instance they're closing about half their stores over half and Macy's is closing 28 stores why do I bring this up in an agricultural webinar mainly because these are jobs these are a lot of lost jobs that are not coming back anytime soon if these stores are permanently shuttered and it goes directly to demand and consumer decisions at the grocery store and their food choices going forward so this is just a few of the I guess I call them lowlights of what's going on right now Sears filed for bankruptcy back in October and what is the long-run impact on things like shopping centers like malls these are typically anchor stores JC Penney is Macy's is Sears was shopping malls have been dying for a while and this is just going to accelerate something that's it's already been happening and again it speaks to jobs it speaks to incomes it speaks to consumer confidence and all these go into the decisions the budget decisions consumers are making in the future now I want to shift gears real quick to some articles that have come out and folks have been talking about farm bankruptcies okay Farm Bureau Bureau puts out a report on farm bankruptcies one come out somewhat recently but I want to put this into historical perspective right now in 19 from 1920 to 29 there were almost 52,000 farms filed for bankruptcy in 1925 was the single greatest year with almost 7900 filing for bankruptcy 1987 actually had 4800 individual chapter 12 filings and that doesn't even include 711 and 13 filings which there's no data for because the laws changed in the mid 80s and there's actually a gap in that in the 1980s actually had a higher rate of depression because there were fewer farms so there were fewer filings but there were fewer farms and the relative rate was a lot higher so my next slide shows a chart from ERS that they've that they put together showing banks bankruptcy rate and the number of filings and you'll see kind of a gap there in the 1980s you see this thin narrower gray bar in the early 80s and there's a gap we know the total number of farms but the bankruptcy rate gap because of law changes but you look at the rate in 1987 was the worst that we actually have data for now and it was it was pretty pretty terrible and the number of farms have kind of stabilized since the early 90s now here's what the rates are my next slide shows a map of the rate of the number of filings and where they've kind of been located 627 okay so yes there's been an increase in bankruptcies yes it's a 23 increase but we have to remember we were starting from a really low number when we're thinking about almost 5,000 filings in 1987 versus 627 in you know the last year relative to the number of farms that's still pretty low and we've we've been coming through some fairly tough times I would say having been covering this and talking about it the last half decade things haven't been easy and still the bankruptcies haven't there hasn't been a lot of a rush to to file for bankruptcy that hasn't had to happen yet and that's a good thing now what this year is going to look like 2020 headed into 2021 I would expect that we're going to see an increase in filings again I don't know that the rate's going to be tremendous I know there's some programs some ad hoc programs that are probably that are coming out we don't have all the details on yet that it's going to provide some farm relief and probably going to mitigate a lot of this I expect that this number will go up more than 627 and the other thing is a lot of these you see this midwest it's in the middle that's red a lot of them have been dairies the dairy sector has been hit hard for the last several years and a lot of those bankruptcies in that area are dairies North Dakota gets lumped into that group but Minnesota and Wisconsin are making up the bulk of it so right now bankruptcies I would say have not been a a big problem or it's showing they're they're starting to rear their head a little bit but I wouldn't say that they've you know skyrocketed it's kind of one of those deals where if you start from a really low number and then you double it yeah it went up 100 but you're still at a really low number and that's kind of where we are from a historical perspective so not looking terribly bleak from that aspect but again this is a whole new year with a whole new set of problems and we'll uh we'll be monitoring it and letting you guys know going forward what what that's kind of looking like and how that's going to shake out so with that I'd like to go ahead and turn it over to Frayn Olson thank you all right good afternoon everybody my name is Frayn Olson I'm a crop economist and marketing specialist with NDSU extension this this week I thought I'd provide a little bit of an update and provide some context for the current status of the U.S. China phase one trade agreement so on my first slide I just wanted to provide some kind of quotes that have been showing up in the news basically this morning there were some statements made by President Trump overnight that have the markets a bit concerned the political tensions between the United States are up again and and obviously the grain markets as well as the equity markets pay a lot of attention to these statements so we need to be following them and I'll make some additional comments later on right now personally you know I want to try and stay out of this political debate or political arena this is a rapidly changing and and again the winds of the political arena changed so quickly that that I'm I really don't want to make a lot of comments on that but there are some people some individuals that I'm following pretty closely to try and get a more ground level view of where we stand and what might be happening when it comes to the actual implementation so here's just a few quotes I want to read them overnight on on one of the major networks and he made these comments so I make a great trade deal and now I say these these this doesn't feel the way the same to me the ink is barely dry and the plague came over and it doesn't feel the same to me and in the following on later on in that same kind of interview there are many things we can do we can do we could do things we could cut off the whole relationship and obviously statements like that really cause some concern in in the marketplace on my next slide there's some additional things later on Treasury Secretary Steven Mnuchin was interviewed regarding President Trump's comments and and his his phrasing was the president's is concerned he's reviewing all his options obviously we're very concerned about the impact of the virus on our economy on u.s jobs the health of American public and the president's going to do everything to protect the economy and protect the American workers so again some of the administration now is starting to take a little bit softer tone this morning actually just after I prepared all this stuff White House advisors Larry Kudlow came out made a statement that with with respect to the U.S. China trade agreement that absolutely it's absolutely not falling apart and the two countries are still working on trade so it's just leveling this this level of tensions is starting to rise and it's causing some concerns about the longevity and least the the structure of of the current current trade agreement phase one agreement so on my next slide I want to zero in a little bit on what we do know um the the trade phase one agreement has many chapters to it as many sections to it there's two of them that really have the greatest impact on agriculture which is chapter three which talks specifically about trade and agriculture um and that the goal of those those that section or those sub chapters really deals with the these non-tariff barrier trade issues like biotechnology the sanitary phytosanitary regulations food safety issues so these are the procedural things that go on in trade between country a and country b to make sure that the product flow is as smooth as possible um the other one that a lot of a lot of people really focused on right now is chapter six which is the expanding trade section and that's the part that I really want to focus on um this afternoon so on my next slide I actually have a quote out of the um that chapter six article six point two um and this is the one that often again gets quoted in the press and I'll read out just a couple comments here so for the category of agricultural goods identified in annex six point one or appendix six point one no less than 12.5 billion dollars above the corresponding 2017 baseline will be imported by China in calendar year 2020 so we have this 2017 baseline and I'll talk about that in more detail in a moment and what the agreement says is that China will purchase an additional 12.5 billion dollars in calendar year 2020 and then when we move into calendar year 2021 China has agreed to purchase an additional 19.5 billion dollars above that 2017 baseline so you know the question comes well what's the baseline number and on the next slide um USDA and their analysis of the this phase one agreement because USDA is in charge of tracking all of this as well as working on some of the implementation issues with respect to agriculture their quote out of one of their analysis sheets or mountain analysis publications in February said the agreement does not identify the 2017 baseline amount so in the in the base agreement we don't know what the 2017 baseline amount is I think we can make an educated guess on what it is but we don't know specifically because it's not in the in the exact agreement what it does say is the United States and China will use official Chinese and US trade data to determine whether the purchase commitments by China have been met so the US is going to track the dollars sold the Chinese are going to track the dollars purchased we're going to try and reconcile those to make sure that we're both counting the same numbers so on the next slide again I wanted to provide a more of a context or an update so if we can move to the next slide there we go late last week US trade representative Robert Lighthizer as well as treasury secretary secretary Stephen Mnuchin and the vice premier of China Luki had a conference call and this is the first time that these three individuals which are really the key leaders for negotiating this phase one agreement actually got together and touched base again so it's been several months since these key again negotiators that actually had a chance to visit say how are we doing you know how are we progressing are we making progress and and how do things look and out of that conference after that conference call Lighthizer and Mnuchin made a joint statement and just a couple quotes out of that that that segment both sides agreed the good progress is being made on on creating the government infrastructure is necessary to make the agreement a success and really that's referring to for example that that chapter three discussing specifically agricultural issues that we're working out these differences in our procedures and processes to make sure that we're using the same information so again trying to remove those non-tariff barriers to trade on the next slide they did make some comments specifically about this level of purchases which is that chapter six portion so they also agreed that in spite of the current global health emergency both countries fully expect to meet their obligations under the agreement in a timely manner now that was the statement coming out of the united stateside there's a very similar language similar statements coming out of the chinese side so as as i try and evaluate and figure out what's going on are some of this some of the the political rhetoric is that really going to translate into substantial issues for this trade agreement or the phase one agreement i tend to lean towards listening to robert alehizer very carefully um historically he's tried to he's very careful what he says but he's tried to provide a very even-handed analysis or assessment of where we sit within not only the negotiation process but also now this implementation portion so we're getting um multiple signals here and and again the markets are going to be very sensitive to these whatever statements are made saying well what is the probability that this phase one agreement is actually going to be implemented and the chinese are actually going to live up to the expectations we have about their purchases so on the next slide there's some comments made from the chinese side of the ledger so these are statements that were made just recently in the next in the last day or so um one of them is from uh the chief analyst within the shanghai jc intelligence or jci this is a private consulting firm in china it's it's very well respected within the in the global community for having pretty accurate information about what's happening within the chinese um agricultural sector they provide their analysis and forecasts for what they believe is going to happen very similar to u.s companies that do the same thing on on the united states side so the head of this chief analyst was made to comment that china has the ability to complete the 40 billion dollar purchases which again is referring to these additional purchases that china has agreed to make but such purchases have to be based on friendly atmosphere so again this is signaling that you know if if we don't have if the trade relationship between the united states and china becomes strained that that brings into question the levels of purchases that china is going to make and again this is what the the marketplace is responding to the other thing china will still implement the trade deal and chances are are high the china will speed up purchases now this is something that again put a little bit of a positive lift into the market it was made yesterday this is from the vice general manager of kofko international kofko is the is a very large um purchasing arm for the u.s for the chinese government okay so what they do is is owned firm they do a lot of grain trading as well as grain prop very very large buyer in the in the international markets own tremendous assets globally and so the statement that they said yes we're still planning to implement the trade deal and that they're going to be speeding up purchases soon again put a positive tone back in their marketplace the next slide let's just look at some of the specific numbers and this is information that i have prepared so i want to this is not official usda information this is not official uh official numbers prepared by the by the u.s government this is stuff that i have collected and i just want to explain it very quickly what i did was i searched i did a custom query or custom download from the u.s census bureau u.s census bureau is in charge of tracking all the imports and exports of goods and services from the united states okay and usda uses this census bureau data as their cross-referencing and checking the information about trade and trade flows so this is kind of considered the the main the gold standard if you will the main data source for for tracking the dollar volumes and quantities of trade for a bunch of agricultural as well as other other u.s products so what i did there's uh 217 specific codes or or our line items are identified directly in that appendix remember i mentioned this that there was an appendix at the very end there's about seven pages of agricultural items that we're going to follow and track to say has china purchased the additional agricultural products that they had promised to in the actual agreement so again these 217 agricultural products are listed directly in the phase one agreement so what i did is identified all 217 of those and i ran a custom query now unfortunately if you notice in the little footnote at the very bottom there were three items that i wasn't able to find of the 217 there's three of the codes i couldn't track down to get exact dollar amounts and they were essential oils finishing agents and dye carriers so i'm i'm guessing that those are relatively small so these numbers should be very representative of the trade flows that we're looking at as it relates to this phase one agreement now again as we said before critical year so 2017 is our reference point what china has agreed to do at least for the calendar year 2020 is to increase their purchases by 12.5 billion dollars well based on those 217 uh items the tally that i came up with it was about 20.9 billion dollars in 2017 so we're using trying to do an apples to apples comparison here so the 20.927 that's in billions of dollars and again in the trade agreement we're counting dollars we're not we're not counting bushels or tons i also then broke down well within all of those 217 categories or 217 items which are the biggest categories what are the biggest sections that china has historically purchased from us and if you look at the column for soybeans in 2017 in the red there they they purchased 12.2 billion dollars worth of u.s soybeans cent of the total purchases in 2017 the second largest categories were called cereals and that included wheat corn sorghum some of this finished products in there like flour or partially product partially processed products and then the third largest category was fish and crustaceans the by far the largest was the soybean category okay now if we drop down to the blue line the blue row excuse me the the only information we have from january through the end of march so again this database is updated periodically we don't have information or totals through today's date this is information collected from january through march and if we look at the numbers for january purchases in dollar terms is about three billion dollars well below kind of any kind of target values that we need and again when we look at soybeans approximately a third about one billion dollars of the of the purchases were made from the soybean category now earlier on we talked about the it was the head of kofko vice vice chairman of kofko mentioned that that their purchases were going to be accelerating soon so on the next slide just to reemphasize that the purchases that china makes from the united states are very seasonal i i have the same graphic now for corn soybeans and wheat um we'll start with soybeans and what this is is it's it's tracking bushels or tax we're keep switching back and forth but i got this information from usda we get weekly updates on what the amount that china has purchased from the united states these again are our purchase agreements so it's not that this is actual shipments these are the the amount of product that they have under contract for delivery within the marketing year okay now the other thing that gets a little bit goofy is we in agricultural look or usda when they track this usually track it on a marketing year basis because they were looking at the supply demand conditions well for this trade agreement we're looking at the calendar year so we have to kind of divide the calendar year from the marketing year and that's why i put that black um vertical line in to try and represent the january one time period so if we this is a a graphic showing weekly export sales to china for soybeans but it's the cumulative purchases so every time we make a sale of soybeans to china we add it to the pile of sales so what we'd like to see is this pile of sales accumulated sales grow as quickly as possible over time and obviously something like the green line which is 2016-17 obviously before the trade agreement before the trade war began is is the kind of sales volume we'd like to see the red line is current sales through um may 7th so again there's always kind of a lag we had some additional um soybean purchases of by china this week we also had they came in and bought some us corn they're not reflected in these numbers so when we look at this if you compare the red line to kind of the historical numbers that we see before the trade war began we're at much much lower levels than than we've seen prior to that and again the black line representing last year's purchases so up to today's date china has purchased about the same volume of soybeans they did in last marketing year but the timing was a little bit different the reason i want to point this out is if you look at when does china typically buy large quantities of us grains and it happens just as we start begin us harvest so again harvest for soybeans typically is late september first part of october and as you can see when we enter our harvest period our sales volume to china increases very very rapidly and i suspect that's going to happen again this year and again that's one of the things that the the vice vice chairman of kofko was noting is that we expect to have purchases start increasing fairly rapidly later on in the year so again i want when we think about the timing issues i'm looking for increased purchases more more large substantial purchases from the united states as we start our um harvest if you go to the next slide this is the same thing for corn now i did make one small change that small changes that i added the gold line which is 2013 14 so the when we look at the previous slide versus this one i added one additional year i did that on purpose because obviously 2013 14 was very different than what we've seen from 2014 through the current time period and the reason for that is is our mere 162 or the syngenta trait that was genetic trait that was not approved by the the chinese and they basically stopped buying large quantities of us corn so previous to that prior to that trade dispute prior to that problem we had with genetic and registration of genetic materials china was a pretty large buyer of us corn and they may return to be one again if we can get some of these sanitary finance sanitary issues worked out these non-tariff trade barriers but again let's look at the seasonality when do the chinese purchases really start to begin and take off well they tend to come in and buy larger quantities of us corn historically again about the time that our our marketing year starts you know in that late september first part of october time period so if we compare the red line which is where we are today to the potential if they were to come back and purchase us corn like they have in the past you know that's a very very large and substantial difference i'm not saying or trying to imply that that's what's going to happen but it's just historically that is what has typically happened and we tend to see again these big purchases right around the harvest time period and my last slide is is basically the same thing for wheat now this is all wheat it's not just spring wheat or winter wheat this is all us wheat and you'll notice that we have a very very similar trend if we compare the red line this is where we are today versus that gold line on top which was again before a lot of a lot of the trade disputes and trade tensions between the united states and china began you see that a lot of our purchases a lot of those those large buys that china comes in and makes tends to be at the end of or very beginning of our harvest season the end of the growing season beginning of the harvest season so again i think we're there's several things coming together that if we can keep pushing forward with this trade agreement that we will start to see larger purchases by china of us agricultural bulk bulk commodities primarily so with that i'll hand things over to tim okay good afternoon everybody tim petrie extension livestock marketing economist we go to my first slide i am going to make some introductory comments not on the slide but everybody wondering about cfap and when are we going to know about our payments again nothing this week and and we'll have to wait another week or more usda fsa ams did hold a a little webinar yesterday that and it turns out i think some people at least were disappointed in that they basically just covered some of the forms they use that first people that aren't used to working with fsa and so we didn't get a lot of new information there i have heard by the grapevine that uh a week from today there's going to be some training for coming in-state staff on it so i know they're making progress out there but we just have to wait all kinds of things going in and around washington that that could affect the livestock and entire ag industry you know the house right now is debating a three trillion heroes act they call it with all kinds of stuff for ag you know there there's a senate bill to require 50 percent negotiated fed cattle or requests for euthanasia funds for the pork industry possibly you know request open crp to keep cattle and grass longer than feed lots proposal to pay feed lots to to delay fed steers that are ready to go on and on and on so i'll just a lot going on there it's all debate why and we're going to continue to hear these things because of the unprecedented times we have on my first slide here i'm just showing how dramatically production of beef pork in particular and and broiler is another big one we look at i have lamb there how dramatic change we had in the month of april you've heard me say before that we were expecting record production of beef pork chicken and total meat and uh that was on track there in the march you can see it at record high levels and then with the packing plant closures and slowdowns and the labor issues and so on we just had a dramatic decline in both beef and pork production down in the lower right hand side broiler production also was off but it kind of came back the chicken plants aren't having as many problems as the beef and pork because there isn't as close a contact and more mechanized and so on although they did come off this kind of goes right into brian's comments about hamburger prices going up it's a good reason why hamburger prices have went up because look at how beef production and so our supplies are much lower and on the other hand like he mentioned the demand is higher because of all the switch over to grocery store buying and and uh and lower price things and and all those issues the panic filling up so we had a big increase in demand for hamburger a big decline in production and those two things obviously both spark higher prices so if we go to the next slide just leading into what i've been talking about here i'll go back when they're uh every month the usda officer chief economist puts out the wasdie report we call it in frame talks a lot about a two on the grain side on the livestock side usually there are very few changes once they start a a new year and uh and but it does come out every month and this whole a much bigger version of this is on my website if you want to go to it i even go all the way back to 2014 up through the the the current show you all the things but here all i did is pull last month's april ninths report out compared to the new report that came out this week on may 12th just to show you that you know uh i was on a conference call with the usda people that make these forecasts and you know they're like everybody else pulling their hair out of things that are happening so fast how can we how can we make adjustments and all the uncertainty and so on but you know every highlighted number there on the back one month ago was was record we usda was predicting record beef production pork production broiler production and total meat production and you see then on the bottom is prices for fed steers and fed hogs much bigger production so we're respecting they were expecting prices to be down a little bit go to the one month later this this came out this week one month later usda is saying instead of record production of beef up about 1 percent from last year uh last year we did last uh yeah last year in 2019 we did 27.15 so uh this that you know that was a record and they were predicting a record for 2020 now jump to me 12th what came out lowered it over five percent on beef production down to 25 76 lowered pork production lowered broiler production lowered total meat production at not a record and uh even though production is down which you might think would enhance prices because of all the pandemonium and so on uh prices down as well actually usda started out this year saying fed steers would be 120 this year that compares to a 117 average price in 2019 so they're predicting higher fed cattle prices and then as we had the high production and started running into some covid problems that dropped last month to 111 and further reduced it down to 104 in this report so just never before in one month has usda changed this so much and so that's how rapidly things happen and just very much a sign of the time so go to the next slide and uh i've been showing this for a couple of weeks we still are selling this is the our market report hot off the press this morning for three auctions that usda keeps track of now in north dakota that's dickinson and mandana napoleon you see we did over 6300 cattle uh this week at auctions so they're still open and we're moving a good volume of cattle to the right of that you see last year they didn't report the markets because there wasn't enough for the prices i'm not going to go through all those but prices were up about one to two dollars you see the prices there i've outlined on the top still a good demand for grass calves of the lighter weight calves although as you see on the way on the far left we aren't selling very many because we don't have many fall morn calves that would weigh that so you know lower supply and good demand there move on up end to the heavier weights and again now we're getting more up to the eight hundred and nine hundreds but we're following that set 50 to eight weight there on 32 83 up about a dollar 50 to two dollars this week at those markets so the good news is the market isn't falling the good news is that you know that we're still merchandising on the fed cattle side and you know lambs the hogs same way tough to get a bed up here but on the feeder cattle side we are still merchandising and the prices aren't plummeting at the same time so go to the next slide uh is just the slide again that i've been showing every week that the red line is what these 750s the eight weights have done all year and then the red squares are the futures market and so again we're trading well above the may futures that today are about 124 50 and actually the may feeder cattle contract closes a week early closes next thursday because it's a holiday week and and so you know there's another signal that we are selling above what they are in in other places and and kind of a signal that if you've got cattle i i guess maybe to keep trading them so go to the next slide uh just to uh i haven't really talked about heifers and you know there's still some optimism out there in the country this you know heifers generally sell understeers for sure but you know have a pretty good run of heifers this week actually 53 of the entire run was heifers and uh and uh and replacement heifers a lot of cases bringing the same prices steers so if you're selling uh you know and you know get bangs vaccinated heifers and good quality and so on or as you can see there they're bringing a thousand dollars you know in spite of all the turmoil we have there so the next slide i actually showed you last time is just all these webinar series that we've we're holding and we've held several uh last night talked about a in-depth perspective of packer profits and on tuesday we did uh in-depth on emcouling imports and exports they're continuing again next week with talk about of euthanization and an in-depth perspective of local meats that there's a lot of interest in now since the packing plan are on down so just help yourself for those webinars if you like and uh that's about all for me now and so i'm going to turn it over to dave to talk about energy great thanks tim uh dave ripplinger bioproducts bioenergy economic specialist with ndc extension uh ending with some really good news as far as what's going on the transportation fuel sector we're seeing uh gasoline use uh grow steadily off the bottom it had a few weeks ago uh and with that we're seeing uh that the same increased use for the most part in ethanol so first two charts uh kind of show that first is the gasoline which is on the upper left hand side and then ethanol use essentially or input to to refineries on the upper right hand side different scales on each on each axis but you see that they move really closely together and this is kind of uh also repeated or shown a different way by just considering that blend rate again with most ethylene in the united states sold as a blend as e10 with gasoline kind of watch that a little bit closely to see how that'll hold up and right now we are seeing that there is a little bit of a break and we're down with that that 0.09 or that nine percent blend rate and the question might be a little bit is that going to continue if we don't see uh regular gasoline sell as much as possibly as premium other blends uh kind of going along with that too just looking at at production which is is picking up but not actually as fast as use is or that ethanol input number and so we've seen a nice steady decline in in stocks which is leading to a relatively strong increase in in ethanol prices and then if we look at the the South Dakota ethanol prices again we don't have North Dakota ethanol prices reported by usda uh the the simple crush uh on a bushel basis for the South Dakota the South Dakota ethanol refiner is now $1.25 a bushel which is a good enough number to definitely encourage others to enter the market if you kind of look and compare those prices we actually see the corn uh the corn prices that these ethanol refiners have been paying for is still about the same expect it now that you know uses picking up that they might be able to to pay a little bit more to to draw more corn to the refineries but of course the biggest change on the positive side is the increase in ethanol prices and and these are the spot prices that those ethanol refineries reported receiving up almost 50 off the bottom uh in early April so that's you know definitely good news and again this signal that uh that that market is really starting to take off it you know more and more refiners will be coming online in the next few weeks uh furthermore you know we're seeing that a decline in distiller's grains prices partially because corn is a little bit weaker they have to compete and also because we're seeing additional supply come back probably most importantly kind of looking at the the general the general trend this time of year is we're entering the driving season memorial days coming up soon and typically we see much more passenger travel in that time and so it would expect naturally that we'd have this increase in use then of course much of the the increase in gasoline and ethanol use is really coming just from the the opening up of the economy some folks haven't didn't refill their vehicles for for six or eight weeks now they're getting the point where at least they're refilling and a lot of folks are driving or returning to some of their regular travel behavior looking now at crude oil more broadly things are are looking much better for crude generally although there's still still a lot of challenges here we've seen an increase in stocks even though the input in use is is is still kind of going the right way that we're we're starting to to get that balance on the gasoline side and we'll see that balance in the refining side but we're still not seeing the reduction necessarily or at least it's not reflected in these numbers in the reduction in domestic oil production there's a lot of concern in the trade that you know that these numbers are off substantially on the production side and that they're really not indicative of what's happening in terms of shut-in wells primarily in Texas and here in North Dakota we can see that this some things reflected in the the price of WTI futures the nearby futures contract is nearly double what it was a week ago now almost $30 which is is definitely a sign the the unfortunate thing is there's been recently about a 10 to $12 spread between WTI futures and the North Dakota light suite which is our predominant oil that used to be you know 10 to $12 and now we're over $20 and really there's this this this this break in the market or this break in these traditional price relationships as again there's still this signal for a lot of a lot of folks to slow down production or even you know in this case maybe even shut in some production and again it ends up being that that regional type market which are driving things as opposed to what we typically see which are these pretty strong price relationships in different types of oil across the country. Other good news too is we did see that cushing stocks have have actually fallen uh been following this pretty closely and then this is a really good sign we're still at at very high at a very high percent of use but definitely going in the right direction you know as gasoline use picks up with the with the summer driving season things are looking a little bit more optimistic of course we'll have to see exactly how that this plays out and again with all of this this EIA data it is a week old and so it doesn't necessarily tell us what's going on today a couple of other things just just really high level first of all following what the WASDE report which came out this week they did revise their their their corn use for ethanol downward only slightly I think numbers is still a little bit high we would really assume that we're going to go back to nearly full production regular use of corn ethanol domestically which is quite optimistic again thinking just about that that calendar excuse me a marketing year for corn which we've only got 18 weeks left in the other thing to look at too and then would drive some of these other studies if we look at DOE's numbers they release their monthly short-term energy outlook this week and they're still quite optimistic in terms of the recovery of the entire fuel complex throughout 2020 and then further into 2021 so if you look at those those numbers for crude production only a slight reduction in crude production and that that annual number for 2020 is higher than what it was last week and so that would mean that we're you know we'd be looking at things becoming pretty pretty firm at least where they are maybe even increasing crude input following a bit again this is is much higher than where we've been the last few weeks so again it would require the market to strengthen even further ethanol production down only slightly ethanol use down a bit more than that and gasoline use down a bit and again the general message from from that report is that you know DOE who was really well received a pretty fair arbiter and determined of these types of outlooks you know they're pretty confident in that that that's strengthening of the market you know going forward just a couple of notes quick on the policy side of things probably the biggest thing going on in ethanol in terms of policy is there's a lot of discussion in washington determining of what they might do with the rfs again the renewable fuel standard mandates biofuel use by type in year the petroleum industry really would like to see a waiver of at least some of a reduction in that that level for this year as we're going to see lower gasoline use lower this lip fuel use we'll see how that goes it is an election year it'll you know be interesting to see how that that always out tim mentioned earlier the heroes act which is a a bill in the house which has a number of different provisions on the biofuel side it does include a 45 cent a gallon incentive for folks or a payment for for those who actually produce biodiesel for the first four months of the year and if folks didn't happen to do that they get if they happen to stop production at lower production they get 50 percent of that difference so instead of every gallon produced it would be half of what they didn't produce times that 45 cents not really sure where this is going to go there's a lot in that heroes act which was likely not palatable in the senate or in the white house but again it's out there for discussion and it gives kind of a barometer of what at least a large portion the elected officials in washington are thinking finally too we're seeing the the the rollout of the higher blend infrastructure investment program from us day it's been a long time in the works and essentially the rules are out and actually got an email just before meeting today with the application available so this is funds that are available from usda to help essentially put in blender pumps and we've you know sitting in north dakota we'd actually have still the largest number of blender pumps per capita per vehicle while traveled by a large amount due in large part because of state programs and actions by north dakota corn to help support that and here we have usda coming back in to to make those types of choices available at the consumer level and again the application is out today so if anyone's interested you know it's there for the taking and typically these types of programs are first come first serve so with that we'll turn it over to question and answer giving you just a little bit of time as we kind of move forward I just let you know if you would give us some feedback using the url on the screen to be greatly appreciated I know many of you have been you know regular attendees of this and that's fantastic and you many of you provided feedback but we additional feedback or timely feedback is appreciated so if you have new thoughts especially about topics you think we should cover please let us know and then as always we do post a recording of this webinar as well as a pdf of the presentations online at the two sites on your screen and so with that I'm going to give you a few seconds to ask some questions and I also ask our specialists if there's anything that that came to mind as they were hearing others speak about different topics and as apparently we did a fantastic job covering our material today we do have one we do have one question that came in wonderful yeah yeah so the question is about the impact of of canadian shale oil on north dakota oil you know they're really different products that the canadian oil is is much heavier it has a little bit further to go and again if you think that the oil is not a commodity it's not like number two corn so if the density is considerably different which would be the difference between a light and a heavy you know it's going to go to a different refinery and because it's heavier is going to take additional processing and so they're really you know there's they're related products but not the same and we actually saw this earlier canadian tar sand oil was really getting push a much greater pushback than north dakota light suite you know earlier and and harder again because it has to go find that refinery that is looking for heavy and then you know we have to you know adjust for the transportation differences as they matter again it's really important to think too you know logistically or look at that at the map and realize you know most of our refining capacity is in the Gulf you know to get it there to get it to the right refinery and then you get it out to the customer you know it changes things quite a bit and that's why you're seeing a bit of a preference for that wti because it's you know it's right there they can deal with it and really these strong signals for the somewhat more distant or in the case of a heavy somewhat less desirable oils you know not to be produced uh dave uh there was a chat what's the implication of the states declaring oil production a waste thought maybe oklahoma was considering this that's a great question i don't even understand the context of that i don't i don't clear if you have any additional information oh and then friend if you want to give us your your your price predictions uh they're waiting for those we're out of time huh friend yeah it's about time right uh i i will uh i will i will see if i can put something together for next week how does that sound yeah and then here's a question for tim uh regarding calves only worth 360 dollars ahead this fall um do you think that's a possibility well anything's a possibility given now you know hopefully we can recover i didn't really mention that but slaughter is coming back and uh it's a long way till fall and uh many things can happen and you know congress is trying to do things so uh i uh it's a possibility i would say right now well it depends on the weight and so on you see what they're selling for now and and we're you know in the height of the pandemic but we'll have a lot more you know more calves to sell this fall although lower calf crop so you know as of now i would take them down as a rule 10 to 15 percent what they were last year which would you know is not not good at all but and then wait and see that's my idea now right they could be all over the board yeah and so here here's the same question but just ask differently frame so what cornerstone prices do you think producers should be prepared to sell that in the next three to four months oh why nothing like being put on the spot here right um so i'm i'm just going to look at a at the December futures chart and um one of the one of the first break points i guess one of the first pricing targets that i'd really start looking at i know it seems a little bit out of the range right now but i think we can we can move higher the there's a us from a charting standpoint there's a break at about for december cornered about 355 i think that would be one of the places but i know that's going to be a little bit lower than a lot of folks want um my my real kind of key target point for december corn is 370 on on december futures um i if i think we can get back into that range but anything above that is going to be really really difficult to do again in particular given the rapid planting progress that we've got in the corn belt for what's going on right now and some of the concerns and issues about the the ethanol markets on november soybeans um the the i think the first i guess real test of the marketplace is going to be at about 890 on on november soybeans um can we get through that i think we could get later on in the season especially if if china does come in and make some larger purchases i think the real sticky point the real tough number for november beans is going to be about a 925 it's going to be very difficult we could probably get back up into those levels but it's going to be really really difficult to punch through those unless we have some major major changes in the marketplace and the attitude is going on right now thanks frame and claire gave a little bit more uh background on that a story from oklahoma about whether you consider oil production a waste uh and as a reason or to actually force producers to stop pumping again i you know i haven't heard about this i do know uh in texas the texas rail commission uh is it oversees the texas oil industry and piece of tribute for you is that opec is actually based off of the texas rail commission and that they do in texas uh have the ability to uh enforce essentially you know different levels of production the government will go in and and try and convince folks not to produce and one of the nice things about this and it might be motivation for this oklahoma story is that if you can do that it allows those oil companies to declare force majeure or to otherwise step away from their contract again if someone is suddenly stopping you from doing business and you can't deliver there's your reason for not having to operate and of course too oil is it you know it certainly can be waste in the wrong place it's kind of like a weed as a plant out of place will oil in the wrong place is certainly not desirable um and i do know too just thinking about north dakota a lot of oil dependent states you know are looking at ways to support the industry both during the downturn and then especially to keep uh keep the possibility that those shut-in wells can be brought in back be brought in uh online again sometime in the near future and again the the government working relatively closely with the oil industry to ensure its its viability or relative viability in the near term and i'll give everybody another second or two to ask your questions but i think you've all had your chance again if you have any feedback for us we definitely welcome you to share it thank you for your time i thank the panelists for for joining us again today i wish and i hope you guys all have a great weekend thanks