 Well, let's go ahead and get started. My name is Dave Ripplinger. I'm an economic specialist with NDSU Extension. I guess I didn't change the date on our first slide. It's April 15th, and this is our April Agricultural Market Situation and Outlook webinar. We're going to have a series of presentations by different economic specialists at NDSU Extension, followed by Q&A. We ask that you use the Q&A tool if you're able. We can also field questions via chat. But we'll save those towards the end. You're welcome to ask them at any time during the presentation. And with that, I'm going to hand it over to Brian Barman. Hey, thanks, Dave. So I am the Ag Finance Specialist with the NDSU Extension Agribusiness. And I just recently completed some news releases on land values and cash rents for both pasture and cropland in North Dakota. So I thought that this would be a good opportunity for me to go ahead and go through some of what I put out there and provide a little bit of additional commentary and context on what we saw with the Trust Land Surveys data that we then compile it into these NDSU regions based more on our budgets, how we group NDSUs or the state of North Dakota into our budgetary regions. So there's a bit more homogenous in terms of what land values are doing and combining those counties. And we also do a weighted average so that, you know, areas with more land carry a little bit more weight than areas with fewer parcels or responses in the survey to make sort of a weighted average. And that's one of the reasons why you might see a little bit of difference between like our state average and perhaps the way the USDA might calculate the average because we weighed it. So my first slide is just, I just kind of want to show what the USDA, when they put out their 2020 stuff back in August, what crop land across the U.S. has done. And when you look at this and you've seen it before, but it goes to show kind of what I'm going to talk about how flat it's been since 2014. I mean, really it's been between, the average has been between $4,000 and $4,100. And it really hasn't changed much at all. In fact, that's as close to moving sideways as you're ever going to see. And that comes off the heels of a fairly lengthy, you know, five, six year, year over year increase, pretty sizable from $2,640 an acre up to $4,100 and then just sideways for the last several years. Now, they don't have 2021 out. That won't come out until August. But as I go through this, I think you're going to probably agree with me. I don't expect that to change a lot, at least into this year. So the first figure I'm showing with this presentation on North Dakota is the average cash rent per acre of crop land in the state. And you can see the regions across the top, you know, those are the Northern and then the Southern on the bottom, except for the East Central in the middle. And each region has several counties in it, some more than others, like Southwest is pretty large. But what we do here is we just kind of show six years what the average per acre cash rent has been for crop land in each one of those regions. And in the report, I note that statewide cash rents are up less than 1%, actually about 0.77%. So a very small upward movement. And if you took a statewide average, and again, this really doesn't do anything. A statewide average doesn't do much other than kind of benchmark the direction the state is going is, are all the cash rents across the state increasing, decreasing, or staying the same? Because if you look here, the most expensive rented land in the States in the South Red River Valley, and 2021's data shows that around 128, 128 and a half an acre, then you have stuff as low in the Southwest as $37 an acre for the average. But by and large, as you can see from a point, less than 1% increase, rents this year are fairly close to where they were last year. In some areas, you might have saw a slight reduction like the North Central from 5160 to 5110. And then for instance, in the Valley, up South Valley, that is up almost $2, but that could almost be chalked up to noise. You know, the data we get as much many observations as we can, but depending on who reports what, that can move the needle a few percentage points in and of itself. So no real wide swings there, and it looks like cash rents for the most part heading into this year were about the same as they were last year, as far as cropland goes. Now my next slide shows land values of cropland across the state. So it's the same thing, except we're talking about land value in dollars per acre instead of the cash rental rate. And as you would expect, the most expensive land also has the highest rental value. And that's in the South Red River Valley at 4,200 bucks an acre you look at last year and the value is close to 4,000. But swings like that are not atypical. We saw them happen in 16 and 17. And again, that can be as much a function of data as it, and not only that, but what the composition of what's been sold. If you have a county, let's say, or an area where a bunch of high productivity index land sold last year, it can look like land values went up. And then the next year, let's say it's a little bit lower quality makes up the majority of the sales. Well, then it looks like land values went down. Well, they really didn't go down. It's just the composition of what was actually sold. And if you just lump it all together and take an average, it can look like things moved up or down. And really the value of, taking an apples to apples comparison didn't change very much, but statewide up about one, one and three quarters percent. So not a big movement there. And if we took a, if we looked at where land values were across the state, again, this doesn't describe anyone region very well, but it's good for benchmarking. 2021 across the state average, 2200 and almost $75 an acre. But again, there's wide swings. You know, the Southwest again, being Southwest and Northwest being some of the least expensive land, a lot of that has to do with rainfall and soil quality and those kinds of things. But we range from 2021 in the Northwest at $1,250 per acre and then you go to the valley and it's, you know, three times, almost four times that expensive. But this just kind of shows it. And again, these regions, we break those out from 2015 through 2021. And by and large though, things have not really changed much. I mean, North Dakota hasn't, has basically mimicked a lot of the US as a whole, where we, our land values have stayed relatively stable. And I'll give you an example. You look here at some of these areas and we actually haven't even hit the high watermark, like the Southeast, for instance, if you look at the Southeast in 2018, $3,021 an acre, 2020, 30, 50 and then 2021 down to 2,805. I don't really think land values went down in that area. I think again, that's a data thing. But for the most part, it's just bounded between about $3,000, $2,800, 2,900 and 3,000 bucks. So moving sideways mostly in that area. And that story is pretty much true in every region you look at with a few exceptions. You got a big increase in the South Central, but again, what was sold, what was the composition there? And that seems to be a bit of an outlier, okay? So my next slide is just a table that kind of shows the 2021 rents and values in each of the regions that are shown on the map just to put it all together and make it easier to look at. And you can see the percent change from the previous year. So that percent rental change, you see a couple of areas showed that they declined and then other areas increased and some more than others at 3.5%. But overall, when you take into the size and how many acres it comes up to about a 0.7, almost three quarters of a percent increase. And then we got this big out, couple of big outliers here. The Northwest says that land values, for instance, increased 15.5%. I don't really think that's true. There just wasn't enough observations and a few transactions or sales really moved the needle a lot and then the same thing in the Southeast. So by and large, I think that maybe one to 1.5% increase is probably pretty accurate or reflective of what actually took place. The thing about that though, to remember, and I don't show it in this presentation is we still have yet as a state to hit the high watermark that was reached back in 2014 and 15. So if I take the state average land value for North Dakota each year since 2014, we've yet to get back to that despite some of the increases we've seen over the last three. And then my next slide, this is nationally, but it kind of shows an inflation adjusted versus a nominal. So if you look at that orange line up right there around 2014, it peaks and then you can see it dipping down slightly and a lot of that is also when you take into account inflation. So if you can imagine land values, for instance, trending sideways for 10 years, well, if you account for inflation in that, then land values actually wind up going down year over year because of inflation, because the buying power of the dollars decreasing every year by a couple of percentage points. So if you just move sideways 10 years from now, for instance, well, that land would cost you less in terms of buying power of dollars that you actually have or spend. And so if you look at it what we call in economics real terms that's inflation adjusted, you get this reduction. Even though the nominal values may have moved upwards a little bit, if nominal values are not moving up at least as fast as inflation, okay, so if nominal values, if inflation's 3% then you figure nominal values need to move close to 3% or better in order to just offset inflation and that hasn't happened because like I said, you look at that other slide and they've just moved sideways. So my next slide shows pasture land values across the US just like that crop one. And they have kind of moved upwards a little bit from that 2014 mark. That was almost $1,300 the last couple of years. It's been around $1,400 an acre across the nation. So a little bit of upward movement and it's been persistent, small but persistent. So I would say there has been a trend upwards and it'll be interesting to see what 2021 looks like but I don't anticipate nationally a big revision or a big upward movement in pasture land values either. And then with all the drought stuff going on, we'll see how that impacts everything. So I do the same report and if you look at my next slide, it shows the same map in the same regions but pasture land and this is pasture land values in dollars per acre. And you'll see the grayed out regions on the right hand side of the state, the South Valley, the North Valley and the Northeast. And I have to do that just simply because there are not enough pasture land sales or reports from the surveys to get a meaningful average out of that. You might just get a handful, one or two and we're pretty reluctant to report any kind of an average or something like that based off of one or two observations. I don't think it'd be very useful and it'd be highly volatile. You'd get just wild swings and I don't think any information could be cleaned from that. But statewide, pasture land values about $833 an acre. As you'd expect, the most expensive pasture land is as you move further east. And last year that was around in the Southeast around $1341 an acre, down from some of the highs seen the previous years which was closer to 1500, other areas around, for instance, the East Central around $1,000 an acre and then you move further west, Southwest closer to 900 bucks and then the Northwest 650. But if you look at those numbers 2020, 2021 like in the Northwest, you see pretty wide swings and part of that's just the small sample size not the pasture lands increasing and decreasing in that area, $100 an acre year over year. So I like to take these and take like a four or five, six year average to see if it's persistent. And the truth is in North Dakota it has been progressively moving upwards year over year just very slowly and you have to take a six year window in order to do that and benchmark it to the statewide average. And then if you look at pasture land rents which is the next slide statewide that's set almost 17 and a half an acre, dollars per acre the least expensive being in the Northwest. And it's, I think it goes without saying to everybody that tracks it, the stocking rates are much more dense in the East and the West due to rainfall and everything else. So when these calculations are done and you're benchmarking this the dollar per acre is a good guide but really this needs to be done on a dollars per AUM basis simply because some areas have a lot more forage availability so you don't need as many acres to raise an animal unit as you do in the West. So it being cheaper it can still wind up being more expensive. Extreme examples include like where I'm from in Southwest Nebraska you're looking at about 12 acres per cow-calf pair where I used to work at Mississippi State it's two acres per cow-calf pair. Now pasture land down there's $2,500 to $3,000 an acre and where I come from it's $800 an acre but when you take into account the forage availability it was actually cheaper in the Southeast because of the density of the stocking rate. And there's other factors to consider there too the more dense the stocking rate the easier it is to manage. For instance, animals don't have to walk as far to water, et cetera, et cetera. So there's some advantages to that as well. So my next slide I wanted to just talk about kind of farmer's expectations of farmland going forward and this is from the Purdue University Ag Ag Economy Barometer. It's a monthly survey that they do questioning farmers not just in Indiana where Purdue is located but other neighboring states in the Corn Belt area. And they do this short-term expectation of farmland values and this is an index and what the number actually means that 148, 140. Don't worry about that as much just if the index is moving up if the bars are taller people more and more people are expecting land values to increase in the short run. That's sort of the takeaway that I would like you to leave from this. And short-term is 12 months or less. A lot of folks thinking that especially when you look at 520 which was around this time last year this was as low as it had been since 2015. And since then it's been trekking upwards over the last year to the highest it's been well in five, six years. So short run, a lot of producers in the Corn Belt are expecting land values to increase. And then if you look at the next slide a long-term is more like a five year planning horizon and relative to where they were. Yeah, there's an expectation that there's gonna be a pretty good increase in the next five years but not as strong as the short run which I kind of found a little bit counter-intuitive because I would think hedging your bet to say that the five year increase is more likely than a one year because I mean you got more time to do it and the other thing is with the price rallies we've had here recently we don't know how long those are necessarily going to hang out and I've been on the record saying several times that six months isn't really enough to move the needle a long ways. So the last thing I wanna talk about with respect to farmland and to keeping in mind because Dr. Olson will talk about commodity prices and he's the expert on that and where they're going and we know the commodity prices impacts net revenues greatly and yields also impact net revenues greatly and so that's gonna impact the farm income and then Tim Petrie will talk about livestock prices and things like that which impact obviously profits from cattle and the amount of money you can make off an acre of pasture land but the one final thing and I talk about a lot is interest rates and what they're doing. So my next slide just shows the 30 year mortgage rate, the 10 year T bond and then the green line is the federal funds rate, okay? So the blue line is the 10 year T bond and then the red line is the 30 year mortgage rate and it's pretty interesting the relationship between the 30 year mortgage and the average 10 year T bond is about 150 to 170 basis points or you can think of it as 1.5 and 1.7%. So those two lines that red and that blue one move together very closely. You can see it from the graph that when one moves the other one tends to move or vice versa that that relationship is pretty strong, pretty strong and pretty consistent. Now the green line, the federal funds rate you can see that the trend that the way it moves tends to move with the other two or I should say the other two move with it but the relationship is not as strong as it is on those others. I mean it's the other one, it's not one for one but it's one of the closest you'll find in the markets but that federal funds rate and the other interest rates basically the research has shown that the 10 year T bond moves about 37 basis points or 0.37% for every 1% movement in the federal funds rate and that relationship can be because there's other things, unemployment figures the composition of what the Fed is buying what type of bonds they're buying influences that as well but on average it's 0.37. So the Fed can influence interest rates and to a large degree that people say control it but really what they do is they influence it. They cannot control the 10 year T bond they cannot control mortgage rates they influence it through activities and impacting the federal funds rate and you can see here that it had been trending downwards and that's kind of how it works but here on the right, you had this increase in the federal funds rate and it was pretty significant all the way up to almost 2.5% and you did not see the 10 year T bond or the 30 year mortgage move up nearly as large and great a magnitude as the federal funds rate did. So again, that's that imperfect relationship but they're related and there's a strong influence but so then why do I bring that up? Well, you've got things happening with the 10 year treasury note increasing due to inflationary fears the last several months while the federal funds rate hasn't changed it's been pegged near zero during that same period of time. So it doesn't have to the federal funds rate does not have to move in order for the 10 year and the 30 year mortgage to actually move there's other factors that influence it as well. So that's why the Fed's job in terms of controlling interest rates or trying to influence interest rates is difficult and just finally on the federal reserve the last thing I'll mention is if you're wondering what they're gonna do basically these dots represent voting members on the federal reserve 2022 basically most of them are saying they're gonna hold interest rates or hold the federal funds rate to where it is right now which is between a quarter and zero basis points. There's one lone person that dark blue dog who thinks that ought to be higher but everyone else says the same. And in 2023 most except all but four think that they're gonna stay at or near zero as well. So, but again, this can change. I mean, this is basically saying if things stay the way they are right now and we stay on the path we're on right now this is what they expect the federal funds rate to do for the next couple of years. Now, if something changes inflation goes spiraling out of control or unemployment or who knows can change this. This is sort of a snapshot, a static snapshot of this is where we are and based on where we are this is what we expect or what we can. So, in closing just a few general comments and things that I hope you take away cropping pasture land in North Dakota still not quite reached the high water mark set around five, six, seven years ago it is inched upward off the lows. That's for sure. And I think that we can see that when you look at the trends but when accounting for inflation I mean, we haven't even hit the high water mark yet and then when you account for inflation at all they're actually down still a good bit. And that's what I mean inflation eroded values further. There was another survey out and I didn't show a slide on this presentation that done by the KC Fed in their region on what farmers intend to do with the money they've made through CFAP and higher commodity prices and very few said they intend to buy new farmland with it. So we'll see if they tend to stick to that or if that's just something that was said and their minds might change but most said they intend to pay down debt. So that's not a bullish response for as far as farmland values go. But that said, corn belt farmers are still bullish on farmland values especially in the short term. And then rising interest rates do put downward pressure on land values and upward pressure on cash rents but so far we haven't seen any indication that those who can influence interest rates have any interest in increasing them or doing anything like that. So there's just not an appetite out there yet to increase rates despite some folks fears of inflation or something else. We have question and answer throughout the presentation and at the end so I'll be happy to answer any questions you might come up with. And I think now I'm turning it over to Dr. Olson. Thank you. All right, thank you very much, Brian. So this month I'd like to look at things a little bit differently than I had before. We're not gonna talk a lot about pricing but I am trying to give you some information, some resources that you will likely be wanting to use as we move through the growing season. Obviously because of very tight stocks in particular for soybeans and tightening stocks on corn the growing season in 2021 is gonna be under a lot of scrutiny. And we're gonna be asking a lot of questions about crop development, about crop yield potentials and where are we sitting with the national production levels? So what I thought I'd do this time is give you some resources that you can go to some websites, some locations, actually some new information that USDA has available that I think could be actually really kind of cool and interesting to look at throughout the summer months. I do plan to include some of this in my presentations as we move forward in time. So this time I wanna really look at I'm not a weather person, I'm not a weather forecaster so I'm kind of getting to the edges of my expertise a little bit but what happens in the weather, what obviously what happens in soil moisture conditions, growing conditions is gonna have a huge impact on psychologically on market prices and what we expect to happen as we move forward. So on my first slide, I just reproduced the drought monitor map that was released this morning. You're gonna see a lot of press about watching the drought monitor maps as we move through the rest of the summer months. And obviously that big red blob in the middle of North Dakota is not gonna help us much. And there are people that are very, very concerned about what's going on right now for very legitimate reasons. However, I wanna make sure that we understand what this information was really telling us. So within the drought monitor and the maps that are prepared, they're really looking at the entire soil profile. They're looking at what are the moisture conditions within the entire soil profile? So those yellow areas really represent where if the crop were to be growing there'd be some crop stress. It's not that we're really seeing any kind of yield reductions yet but the crop would be under stress in the brown areas. What's happening is that dry layer is moving a little bit deeper into the soil profile. By the time we get into those darker browns and more importantly the reds and the maroons, what's happening is that again, the soil moisture level where the water table is within the soil profile is getting deeper and deeper. So the drought is becoming more intense. And for example, in the red areas you start to see stock ponds going dry. You start seeing wells having problems. Excuse me, some of the irrigators may have some problems being able to pump enough water volume. But from a cropping standpoint what we're really concerned about is what's happening within that top soil layer. So even though we may have very, very dry conditions in the deeper soil layers, if we can have regular rains at the right time we can still have some pretty good yield potential. So I want everybody to think about that yes, the drought monitor map influences psychology in the marketplace, people are watching it. Excuse me, it's updated on a weekly basis so we get new information all the time but it may not really represent growing conditions. So we got to be a little bit careful about. On the next slide I just give you a quick synopsis of, excuse me, I got a tickle. The drought monitor map is released every Thursday morning. The easiest is to type into whatever search engine you're using. If you just type in or Google US Drought Monitor it's usually the top thing that appears on the search. I did give you the URL so if you did want to type it in and find that information that's fine. The next slide is information that the USDA prepares. Okay, so once the drought monitor maps have been released by the folks at the University of Nebraska in Lincoln, the USDA takes that information and they overlay the drought monitor maps on top of the typical growing regions. And so usually either late that same day on a Thursday or sometimes Friday morning depending upon what's going on they'll show you these kinds of maps. And I know Tim Petrie uses these kinds of maps and he has discussions about pasture conditions. So even though there might be a very severe drought going on here in North Dakota we have to be from a pricing standpoint how much of the total production might be impacted for corn, soybeans, wheat or other crops given the drought area. So what's really nice about this is given typical production these kind of average production or bushels produced over the last several years you can see the darker the green are considered major in this case corn growing areas. And then the lighter green is minor corn growing regions and then the red hash represents those drought areas. So this is the information from last week. I just checked USDA is not updated this mapping system yet but they will shortly based on last week's information about 19% of the corn production meaning bushels are under some kind of drought or drought stress at this time. Okay, so there's a map very similar to this for, well map for corn. The next slide would be the map for soybeans. So again, notice the growing area where we have these major production regions shifts a little bit between corn and soybeans even though that major Midwest corn belt Iowa, Illinois, Indiana, Ohio again and Nebraska are really the core center of that. We do have a larger geographic footprint for soybeans than we do for corn. So right now when you count bushels approximately 17% of the bushels that we normally produce are experiencing some level of drought or based on the drought monitor maps. The next slide is the same picture for spring wheat and obviously spring wheat being this region of the dominant production is North Dakota approximately 80% of the bushels right now for spring wheat is being either partially or in a major way impacted by drought. And this again is one of the reasons that the corn market and the soybean market may respond a little bit differently than the spring wheat market to new information within the drought monitor maps as we start looking at the changes over time. Again, I wanna remind everybody the drought monitor map is looking at the soil moisture levels in the full soil profile. So how do you find this information from USDA? The next slide just shows you again, when is it released? It's usually every Thursday late afternoon. Sometimes it's a Friday morning. If you're gonna search for this, if you're gonna use a web browser and try and search for it, just type in USDA agriculture in drought. It may not be the first item that shows up in that search, but if you look down for something from the USDA, if you look at that URL, if you look for this PDF file. So when you click on it, it's what's gonna happen is you'll get a PDF file that comes up automatically. So the next slide is some additional information that USDA has created in conjunction with NASA. So for the last several years, both USDA and NASA have been collecting a lot of satellite imagery about North American agriculture in particular US agriculture. And they now have a website and I just recently found it that's called CASMA, which represents the condition and soil moisture analytics. So what they're trying to do here is they're using satellite imagery and they've cross validated with actual ground truthing. So the USDA as well as NASA have been doing this satellite imagery for many, many years. And they're now allowing access to it so you can do your customized search. So this is actually a website you can go to and based off of the different filters that you wanna put on it, you can get some really interesting information about what's happening, not necessarily in the entire soil profile, but more importantly, what's happening on the surface or within the root zone. So I have a series of maps here just to show you the flexibility. You go to one website and depending upon the kind of map that you wanna create or the kind of information that you wanna search for, it'll present the same information slightly differently. Now on the very bottom of this slide, you'll notice that I have some background information about what information is available. So when you go to this website, the first default page you're gonna get to is called Soil Moisture Anomaly. So if you find this website and you automatically pop it up, the first thing you're gonna see is a map very similar to this, okay? Now this is soil moisture anomaly. So what they're looking at is how does the current soil profile, soil moisture profile compare to average or normal, okay? Now for the surface moisture, these soil moisture anomaly, they're using data from about 2015 through the current. So they don't go back 20 or 30 or 40 years. They use from about 2015 forward because that's the data that they have that's most reliable from the existing satellite imagery. Okay, so we're looking at what is today's soil moisture content relative to what we would normally see at this time of year. And you can see that percentage. So this would be a percentage soil moisture relative to normal. And this is for the top two inches of soil moisture. So if you notice the red is highlighted on the very bottom, I have top two inches. If you want to change the parameters, if you wanna change the map, you can get either a two inch or you can get a one meter depth. Now the one meter depth is about 3.2 feet. You can choose whether you want this daily information where it's updated on a daily basis and looked at it from a daily perspective or from a weekly perspective. So you can choose a very short term if you wanna look at what the current soil moisture is kind of average for a week relative to what this week looked like over the last several years, you can do that. Now I pulled this information this morning. So I pulled all the maps that you see this morning. Now when I say daily, there is a slight delay. So the information you see on this map is for the top two inches of soil. And it was as of April 12th, which is about two, almost three days ago now. So it's updated daily, but there is this lag or this delay in getting the information updated. So you see a little bit different picture about in particular what's happening here in North Dakota but also what's happening across the other parts in the United States. So we're not really concerned about what's going on really deep in the soil profile. We're trying to look at what's more importantly, what's happening at the soil surface or in particular in that growing zone. And again, during the spring's work, we're really concerned about that top soil moisture if we're gonna put seed in some dry soil is there enough moisture there for it to sprout? Okay, so you can see based on the rainfall we've had over the last several days, you got to look to the Southwest corner or Southeast corner, excuse me, of North Dakota. You can see we're actually in the blue when you look at the soil moisture conditions for this week or for the last several days relative to what we normally see at this time of year, we're normal to slightly above normal in the Southeast but you look at the rest of the state obviously we're well behind. On the next map, it's the same information from the same website, but I just changed essentially the search parameters. I changed the map to represent information a little bit differently. So what they're looking at here is the actual an estimate of, and again, this is satellite imagery that's been cross validated by actual soil tests. This is actually looking at what is the percent soil moisture? So what we're looking at is how many cubic millimeters of water is in a cubic meter of soil? So think about it again, percent soil moisture. Now this is for the top meter of soil. If you notice on the very bottom I have highlighted in red, this is for the top meter. So this is again an estimate of the top three feet. How much moisture do we have in that top three feet of soil? If I wanted to, I could switch the map to the top two inches. I just wanted to demonstrate you can change the depth of the estimates. Also notice now as we get into that Southern part of the US in particular the Southeast they've had lots of rain showers coming through over the last several weeks. The soil profile when you get into Louisiana, Mississippi, Kentucky, Tennessee, they've got a really full soil profile and there are some questions starting to be raised about whether they're gonna have some prevent plant in those areas. So this can be used not only for tracking what's happening in North Dakota but what's happening more importantly at a national basis. And again, so this is the same website, you go to the same place but you just click on the different choices on what you want the map to represent. Okay, and again these can be updated either on a daily basis or a weekly basis. Now this is weekly information. I pulled up for the weekly information. Now this is as of the week ending April 5. Now I'm expecting them to update the computer models here pretty quickly. So this would be as of April 5th and of course today is the 15th. So there is a little bit of a delay between when they compile the data and when it's actually published. On the next slide, again you can with the same computer program by just changing some of the mapping parameters. This represents again the soil moisture categorically. So rather than looking at it as an absolute value like a number, they put it into different categories. So is it very short which is the brown? Is it kind of a short being the yellow? Is it adequate? Is it surplus being the dark green or don't we have data which is gray? So again, very quickly from a picture standpoint you can have an idea of what this looks like. It does have the ability to be able to zoom in. So you can zoom in on a particular county or a particular area or region. Just be cautious if you do zoom in it starts to getting kind of pixelated. You lose the resolution isn't extremely detailed on this but it does give you a pretty nice picture of what's happening. So this is soil moisture on a categorical basis. If you look in the very bottom highlighted in the red is the top soil moisture that I'm looking at. And again, this is only available for weekly basis. It's not available on a daily basis. The next slide using the same computer program they also provide satellite imagery for vegetative index. So later on right now this is gonna be all brown basically because we haven't planted the crop yet. So to use this information at this stage of the growing season really doesn't provide you a lot of insight into what's going on. But later on as the crops begins to grow as we've planted and starts to germinate and start to grow we can get an idea of what is the vegetative health? How green is the crop as we look across the United States? So NDVI which is that normalize different vegetative index. It's basically how green is the crop? They're using different spectral ranges on the satellite to take pictures, say how green is this crop? If it's obviously if it's very dark green it's very healthy, we get a darker color. If it's under some kind of stress typically you have less chlorophyll so it means it's a little bit lighter green. You do have the ability to look at what I did here was I filtered it. I said, I just want a picture of not all of the United States whether it's forest land or pasture land or crop land. I was able to filter it and click on a button say I just want to look at the crop land acres not necessarily forage like a pasture land or forage acres or more importantly forested acres. So you do have the ability to look at just all acres or all land mass as well as filter it down to say let's just look at crop acres only. Now this information is only updated weekly. So you can't get it on a daily basis but you can get a weekly number to say for this week relative to history how do we compare to what we normally see at this time of year? So you have the choice to go either in an absolute terms or in a relative term. The next slide is again the same website the same pieces of information but this is looking at the mean vegetative condition index. So now what we're looking at is again how do we look at it? The NDVI showed you before is the absolute. So just how green is the crop? This is how green is the crop compared to what we would normally see at this time of year. So now it's being relative to a normal. Now based on what I could tell I couldn't find out what the definition of normal was how far back in time do they go? How many years I wasn't able to find that information but I will keep digging and I'll try and update you as I have more information. The point is by one little check the box you can now switch it from what is the absolute picture to how does this compare against average or typical? So it's great to see what areas are really healthy and looking good but is it the same as what we saw last year or the last several years? So if you have an area that shows some differences it can show up in this map. And again I filtered it based upon crop land acres not necessarily all acreage or all vegetation across the United States. Okay so on my next slide where do you get this? And again I found this very valuable. It takes a little bit of time to kind of figure out how to maneuver around and be able to filter and sort things out. So you might have to experiment a little bit. They do have a manual that's online that you can download and look at the instructions if you wish. So information is updated either daily or weekly but understand there's always a delay. It takes a little bit of time to take the imagery to create the data to convert the data from the numbers that are being captured into the maps that you see generated. If you're gonna go into your search engine whatever search engine you're using type in USDA crop, CASMA, C-A-S-M-A. Okay and what'll happen is you'll go to this website here which is that research and science. Okay what'll happen is you're gonna have several choices on some different kinds of satellite imagery that's available. Make sure that you use that CASMA, C-A-S-M-A to get this information. All right on my next slide I just wanna remind everybody that so that was looking at soil moisture and crop conditions. I wanna remind everybody this is a tremendous resource we have available here in North Dakota and parts of Minnesota. We're very blessed to have NDON which is a North Dakota Agricultural Weather Network. So if we're looking at for weather specific data what's going on here in North Dakota this is the most accurate information you're gonna get and they collect a tremendous amount of data. You have some choices to be able to create some maps. I just created this morning a real quick rainfall map. How much rainfall have we had over the last seven days? And literally it's go to the website, click on the maps, click on what you want and the image is generated. So if you're trying to follow what's going on here in North Dakota specifically with weather, with rainfall, with soil moisture temperatures, with humidity, with temperatures. This is a tremendous resource that we have available. We're very, very fortunate to have this in our portfolio of things that we can use to try and understand what's happening to the crop here in North Dakota. So again, this is a seven day rainfall total. If you look at the next slide I did pull up the soil temperature map. If we can go to the next slide please. There we go. So this would be soil temperatures that are actually measured by the different weather stations across the state. This would be for bare soil. So it's not a turf temperature which would be like in your lawn. This would be a bare soil more closely related to what the field would look like. And again, it's in the top four inches of the soil layer. So obviously if you have several really nice, sunny, warm days these soil moisture temperatures can pop up. Right now they're relatively low. This is kind of interesting to watch because if you do have some wheat or barley that has been planted at what soil moisture temperature do you need that germination to start? So in the spring, it's really nice to be able to look at potential growth and growth potential. I just pulled up some of the basic information that's available. So to find the next slide, to find the end on numbers or end on information. Again, this is actually updated hourly. So if you're interested in getting information again about current weather conditions, humidity, potential temperature inversions if you're out spraying in the field, tremendous source of information. They also have a really nice app that's now available to give you some warnings if you do have conditions that are suitable for temperature inversions. So please check it out. If you're searching on the web, look for North Dakota or ND, agriculture or weather network and it should pop right up. And there's the URL if you wanna type it in directly. So my point in bringing all this up to try and conclude is as we're going through the rest of the summer growing season, the weather is always in interest to the crop markets, but in particular this year because of our ending stocks being so tight specifically for soybeans, but also now tightening for corn, there's gonna be a lot of pressure on the crop and the growing season in 2021. And I guarantee you the markets are gonna be watching this very, very closely. So I wanted to give you some resources that you can go to to be able to look this up yourself if you wish. So with that, I'll hand things over to Tim Petrie. Well, good afternoon, everybody. Tim Petrie here, extension livestock marketing economist. If I go to my first slide, I just wanna quickly give you an update on calf prices and then move into some drought issues. In spite of the drought, speaking of that and $2 increasing corn prices, feeder cattle this year are following a much more normal historic seasonal price pattern unlike with the pandemic last year. So a lot of lines on this chart, mainly concentrate now on the purple line was last year and then the red line is this year, these are 550 to six weight calf prices in North Dakota that markets at USDA report. So as you can see, we've been gradually increasing had a nice bounce last week, maybe more so because we've had some really nice strings of high quality calves bounced it. But anyway, the last three years, 2017 isn't on this chart, but 17, 18 and 19, we had 180 there towards the end of April 1st of May. And last year we were on the purple line, we're on track to do that. There in February, we're already up to 176, but then the pandemic hit and crashed prices. And again, we underperformed the entire year, although the last half of the year was the same as 2019, although that wasn't a particularly good price here as you all know. Now this year, we're right up there bouncing up to 180 again. My thought is, it all depends on what the drought does and what corn prices do and they can keep going up and change corn, 10 cents a bushel, change fall calf prices, a buck in the opposite direction. But I'm looking for us to follow that assuming that the drought doesn't affect corn and corn just goes up another dollar or two, that we'll kind of follow that blue line on the top there with better prices. But again, the big thing is corn. So go to the next slide and there we've got the heavier weight yearling type of cattle in kind of the very same scenario there. So I won't repeat it. It's just that again, we'll follow that blue line up there of 2018. Now I agree the fed cattle are trading and the futures are quite a bit higher than 2018 but why I'm using 2018 for calf prices is simply because of the $2 higher corn prices. But you see, we have a futures market for 800 pound steers and it's pretty much right on the blue line, all of that light blue line on top all the way up through fall and even higher when we get to the later end of the year they're up about 160 compared to even in 2018 under 150. And then the general cyclical trend is for higher cattle prices assuming no catastrophic events because we've been reducing the herd the last couple of years and it's not gonna go up this year with the drought. So on the left hand side then those orange dots then are for 22 even higher. So move on to the next slide. Just to give you some drought information as Frayn showed you there's drought and I won't repeat all the drought monitor stuff there but the nice thing about the USDA livestock forage disaster program is that it's tied to the drought monitor instead of the old days we had to do it by county basis and each county had to be declared a federal disaster area either by the secretary or the president. So it was a big, every county in North Dakota one by one we had to get declared a disaster area. And now, and that's still the case for instance for like CRP grazing early opening a CRP and others but the livestock forage program now is tied to the drought monitor. So USDA does not have anything to do with it. We don't have to do any applying or anything that's automatic. You see there 76% of the state is in D3 extreme drought and 17% in D2. Those are important. So if you go down to the bottom then what triggers payments is during the normal grazing period if any part of the county hits some of those D levels it automatically triggers payments and actually our grazing season for North Dakota started today as you see there October 15th and April 15th and ends October 15th. So you have to be in D2 for eight straight weeks to get a one month payment. But when you hit D3 you get a qualify for a three month payment. And as you can see, 76% I'll show you the counties in a minute actually 43 counties there qualify for three payments already go to D4 you move up to four months and D4 for four weeks up to five monthly payments. So we don't know what the monthly payments are gonna be yet when they do come out usually don't come out to May and that's when we could start applying but you kind of wanna wait to see how it goes. Last year the 2020 monthly payments that was $18 per cow that's for a one month payment. So we would for this year if it's the same for the D3 area there would multiply by three and last year just three counties qualified. When the USD information comes out it's gonna show a much higher number than that. Like last year it was $32 but the small Prince says they only pay 60% of what their estimated feed costs are and then they take another 5.7% off for a sea sequestration. So that lowers it down from 32 to about 18. So go to the next slide while we're on the drought monitor topic right on the drought monitor website that Frank talked about there's an FSA eligibility map there the website shown on top. So you can just click on your county to see what you qualify for. I just clicked on North Dakota and now showing those 43 counties that are eligible. The other thing is it just barely has to hit the nick of a county for the whole quality county to qualify. Nelson County for instance up there it just barely hit it in one little corner but the whole quality county qualifies. But unlike the other programs where you do the CRP and everything contiguous counties do not count this is the actual drought monitor has to hit that county. So go to the next slide. Here you know it is not looking too optimistic also on the drought monitor webpage they do a seasonal outlook this is through June 30th showing the brown that drought persisting and then the yellow is drought development likely which comes down into our southern states we're basically in a drought anyway. So we're faced with drought and so on the livestock side we're going to initiate some other drought webinars it'd be the last Thursday of the month so it doesn't conflict with this one you're on today which is in the middle of the month but we're gonna do a drought Zoom meeting just like this as those shown there the last Thursday of the month you wanna register just go to that end issue drought. So the next slide we have our state climatologist add on every week does a briefing when the drought monitor comes out to tell us how severe the drought is he has developed a drought severity coverage index. And so you see on the bottom the drought monitor actually started back in 2000 and up through the current in it and that purple line then just shows the severity of the drought and this was of last week because he hasn't got it updated yet for the new one that just came out this morning but we're already in the worst drought that we've had since the drought monitor that started in 2000 with his index up there at 365. We've had other droughts back 2017 you know, 290, 295 we had some drought back in 2013 and also back in 2006 and eight that were quite severe but I want you to kinda just remember this index here because I'm gonna transpose that over onto the number of cattle that we have in beef cows that we have in North Dakota just to kinda show you some possible impact there. So go to the next slide is on the top is January 1st beef cow inventory. And so you can see there we did go down a little bit on January 1st, 2021 20,000 head down there about where we're about 975,000 beef cows in North Dakota and we've got the worst droughts yet. And if we go back and look at some of those past droughts back into 2017 we had 954,000 and 12,862,000, 2008, 924,000 and so on. So we've got the highest number of beef cows on hand at least on January 1st that we had in any of the previous droughts here since 2000. So we got a lot of cows to take care of and we got very dry pasture so that is certainly a concern for us. Also on the bottom you see the number of replacement heifers that we have on January or had on January 1st and we've been keeping a lot of replacement heifers in North Dakota more than we need here but it's more of a profitability type of enterprise where heifers are extremely low priced in the fall and so producers keep them and develop them into replacement heifers. And so the report on January 1st that they're replacement heifers but we had on January 1st of this year the fifth largest number of replacement heifers ever since back in 1920. In fact, you see there in the last number of years there since 2007 we've had a lot of years we could add 2018 and 19 are the seventh and eight. So we do keep a lot of replacement heifers and have a lot on hand but one of the nice things about replacement heifers is that if we face a drought we can we don't these are planned to be put in with a ball this summer but we don't have to do that and it gives us some flexibility and we can sell them. And so go to the next slide here kind of to wrap up. Stockman's out in Dickinson is having a sale today and a pretty big sale. They already had 2,500 consigned as about a day ago. 1,500 of them are these replacement heifers that would be put in with the ball this summer and also then about another 1,000 breeding stock. And so, it's a big sale. It's hard to say exactly how many of these might have been forced liquidation to the drought because some of them are developed and would be sold anyway in the spring but I'm assuming that at least maybe not all of them but quite a number of them are forced due to drought. Yesterday it kissed 70% of their receipts were heifers and so again, instead of going in with the ball and they still could be purchased as replacement heifers but we're seeing liquidation of cows already but on the good news then on the left hand side this is last week's average prices for heifers in North Dakota at the three markets Napoleon and Mandan and Dickinson. If when you look at those replacement heifer prices there where it says replacement, starting off with those 687 pounders at 139 bringing $956 and then all the additional replacement heifers down there are over $1,000 till you get down to those 945 pounders there at about $1130. So still generating money and even the feedlot heifers are generating money. So I think go to the next slide. I think I'm finished and we'll turn it over to Dave to wrap up. Great, thanks Tim. Dave Ripplinger, Bioproducts, Bioenergy Economic Specialist. I just have a few comments to make about corn ethanol specifically and some things that I'm kind of watching. So my first slide is days in storage for ethanol over actually the last almost last decade and a little bit of noise there but a couple of things to point out. So one of the first thing that jumps out is last year when we had a shutdown essentially in the economy we saw those days in storage dramatically increased we continued to produce it wasn't being used but really what I wanna look at is that black line which is actually this year. And so as we go across that line from left to right we're moving from January through today and we can see that that days in storage numbers continuing to decline which means that we're, we don't have as much in stock relative to our use. And so that's depending on where you sit good news or bad news it's driving up ethanol prices which is positive on the demand side but there's some other concerns. One of the things to really look at and we're really not there yet and there's not too much talk about it but it does make me think back to 13 and 14 when we had very high ethanol prices both of those years we had ethanol prices over $2 every month but one and oftentimes close to $3 a gallon very high prices. Right now we're not there yet prices reported by Iowa State or $1.73 a gallon for March, USDA for South Dakota last week was $1.81 Clearly going up we're already in that place where we're in some of the highest prices we've seen in the last decade and if things tend to continue which they might, you know we could see those prices dramatically increase and one of the words to use here is, you know we're reaching this point where things are getting a little bit inelastic and those prices might go up a lot faster to try and pull additional production online. We're still at about 90% of where we were prior to COVID, not a year ago, a year ago we were really in the midst of the rapid shutdown of the industry but kind of 90% of where we were gasoline use, travel demand especially looking for the rest of the year especially the summer is really bullish. This is paired with high corn prices so it's not as if the corn ethanol refiners are making much money but it should be a signal to the corn industry that there is, you know some pretty stable demand for ethanol and consequently for corn and that kind of leads me to one of my bigger concerns and that's this stock use ratio. So, you know, WASTE came out last week looking really closely right now we have very high prices because we're going to use a lot of the corn, soybeans other crops that we produce and end with very low stocks relative to use. So this is a really common chart that you see ag economists produce and on the horizontal axis we have stocks to use so ending stocks versus use for the whole year and then on the vertical axis it's dollars per bushel in this case is the farm gate and what you can kind of see is there's kind of like a big clump of data in the middle and then to the right including in 2021 but if you go just a little bit to the left you know, if we start that 2021 which has a dark open circle you know, you can see that level if you go and just decrease stocks a little bit relative to the use you see this dramatic increase in corn price and so we go back to 12 and 13 which were historically high prices for corn and so we're in that realm and so the numbers I look at really closely are that bottom line that ending stocks number and then also where ethanol is at and where other things are at and we're in that place where just a small little click and USDA typically moves or changes numbers in 25 million bushel increments you know, we're in that place where if they start to make those changes you know, you're moving that number really, really quickly if it's in terms of increased use to the right pretty quickly and again, we're in that place that in Elastic Place where prices could rise dramatically could be good news in general for Midwestern corn farmers not necessarily good news for corn ethanol refiners even though there is stable demand, growing demand for that product that feeds that cost could be really quite onerous so something I'm watching every month I'm gonna be looking at those minor little tweaks if and when they're made all across that S&D for corn and it could be a bit surprising and get any disruption that's not foreseen so if we do have production related issues if we do see some increased demand or really strong demand either in ethanol or elsewhere we could see really high prices moving forward last comment I wanna make is just regarding CPI so the inflation index numbers came out last week was a little bit interesting for a couple of reasons one is we're basically a year past the bottom more or less of where we were so some of these numbers are really, really big and so the price of energy relative to last year significantly higher and that's a little bit deceitful because we had this really high low and then kind of what you might consider an average number for last month but if you look at the trajectory of where we're at and again, this is a basket of energy products that urban consumers buy adjusted for seasonality but this is gasoline, this is heating oil those types of things that basket that price is increasing really, really quickly and if you could actually map this really closely it would follow petroleum crude oil pretty closely as well if we look just at this length from 2018 through last month you'd say well, we're kind of just getting back to where we were and that's true but if we extend things even further if we go back to 2012 and really what I'm looking at is 2014 we're hitting this level we're actually as high as we were in 2014 if you go back to the middle of 2014 this was $100 oil and I'm not saying we're gonna go back to $100 oil but that was a period where we had very tight supplies of energy and relatively high prices and if our trajectory continues you'd expect to see not only these higher retail prices but higher wholesale prices which depending on where you sit is a good thing or a bad thing and it might be enough to first maybe from our perspective bring on additional ethanol refining capacity which is currently idle or from that North Dakota perspective lead to additional oil development which has really been lagging ever since COVID hit so those are my general comments right now open it up for a question and answer and bring all the panelists back to have any answer, any questions you might have and then of course as we kind of segue to this place are there any questions or comments that we had either during following your presentation or as other people spoke I don't know Frank if you have some insights on what I shared maybe tell everybody I'm completely off base No, you're actually very close cause I do obviously follow the corn market very closely that stocks to use ratio and the relationship between prices and we are at that kind of at that tipping point what I usually say is 10% stocks to use ratio is kind of that tipping point if the marketplace has if we have more than 10% carryover stocks prices tend to be relatively low and stable the market feels comfortable that we have reserves in cases or problem next year if we get less than 10% and we're now under 10% all of a sudden the market gets very, very nervous so we tend to have higher average prices but a lot of price volatility so on the corn side when you look at corn stocks the old crop corn supplies are getting tighter they're not as tight as what we saw obviously back in 2011, 12, 13, 14 but they're much tighter than we've seen over the last several years and so that's putting additional pressure on the growing season in 2021 which again, we're gonna see a lot of price volatility and I don't see any questions up apparently we're answering all the questions last month and this month there's one anybody have any other thoughts one question I kind of have for Brian looking at farm prices if there's potentially significant inflation underway which is possible do you expect that there would be an increase in farmland prices are folks gonna look at that as an investment in some respects as they did a decade ago five, 10 years ago? They might but as we've just seen it's not necessarily a hedge against inflation at all I mean, I just, if it's trading sideways and inflation is occurring then just because it's a hard asset does not necessarily make it a hedge against an inflation especially if people think that it was either aptly priced or overpriced or depending on how the farm economy goes so there may be those folks who think that and that was kind of the logic but I wonder, I do wonder a little bit if folks have soured on that notion that well, hard assets or tangible assets tend to increase with inflation I wonder if some of that's been soured upon now is there inflation right now? Maybe, I think it's gonna be a while before we can see if there actually is and there's so much stuff going on that's mixed we've got mixed indicators there's nothing, there's no neon sign pointing up down or any other direction you've got a bunch of small signs pointing in different directions and it's really tough to sort out exactly which direction things are gonna move a lot of our indicators some are pointing one way, some are pointing the other I mean, we've, you know unemployment figures right now aren't that bad all things considered so that would be a and then you've got the equities markets doing really, really well and then you've got more government spending coming down the pike which it all point to potentially to inflation but then you've got worries that people aren't spending because of potential COVID on the horizon and things like that so I'm reluctant to say Well, and one of the points you made too I'll follow up on is we see energy prices in general at the retail level increasing again, that's just one part one basket in this bigger set of baskets so it's, you know people might be seeing that at the pump but that is not everything at least not yet today and so it really is kind of just that product space related not everything although sometimes it can be a harbinger of things to come Well, we do have a question for Tim about LFP so will it be almost double? And our next webinar is actually May 13th but anyway to answer Carl's question which I can't do I don't know what India what FSA is gonna do I would be very surprised if they double it from last year all you know corn has went up but they look more at hay and forage prices and you know they may increase it some but I can't speak for USDA but I am almost positive that it will not double it'll it could be up a couple of dollars but I don't look for it to change a huge amount from last year even though corn has went up but we'll have to wait probably till May they are being encouraged to get the information out earlier because it's so dry this year compared to last year when a lot less drought so we'll just have to wait and see Thanks Tim, yeah as was pointed out our next scheduled webinar is Thursday May 13th it's always the Thursday after that monthly WASDE which gives us some a chance to look at some other data in the industry to get access to slides and the recording of this and previous webinars as well as the correct dates for future webinars you can go to the webpage we have which is on your screen we should have the slides and this recording up shortly I think we're out of questions and with that I'd like to thank everybody and you know it's kind of a special day because it should be tax day but it's not and so we all have the reprieve for another month or so so you don't have to, you know, quick print off your stuff and run to the post office before they stop taking that last batch of mail so I hope you guys all have a great day and hopefully we have some better news in terms of weather and precipitation the next month and hopefully we'll see you all in May, thanks Yes, let's hope it rains