UPI Farming Today

Short war could boost U.S. agriculture

It's to the advantage of agriculture in the United States for the military to achieve its goals in Iraq and bring a swift end to war.

Texas A&M University extension service economist Joe Pena said a short war in Iraq would stabilize trade and world economies, which could increase the demand for foods and other goods produced in the United States.

"A short, successful outcome to the conflict would be positive for demand," Pena said, adding that the food needed for relief efforts for the Iraqi people is not enough in and of itself to boost U.S. agriculture interests.

"The amounts involved are not considered significant to impact markets," Pena said. "Food aid supplies are already stockpiled in Kuwait or other nearby countries, and markets have already accounted for that demand."

Market prices for agricultural commodities have not yet suffered due to the influence of war.

Except for cotton, Pena said the problem with agricultural markets is weakened export demand, coupled with an oversupply of assorted crops.

He cited Agriculture Department figures showing corn production estimates of 9 billion bushels -- unchanged since November.

The Agriculture Department has reduced exports by 175 million bushels and increased stocks from a market strengthening 848 million bushels in November to more than 1 billion bushels, according to the most recent supply-demand report.

"U.S. agricultural exports are lackluster because of both stronger export competition and continued uncertainty in global economic growth," Pena said.

"Imports remain strong primarily because the U.S. dollar continues relatively strong against most foreign currencies," he said.

The dollar is weakening compared to the yen and the euro, which Pena notes means that U.S.-produced goods are now cheaper than usual in those currencies.

"It may attract increased exports to those and other countries with similarly weakening in the value of the U.S. dollar," he said.

Feds to help Klamath Basin farmers

The Agriculture Department this week provided $7 million to help farmers in the Klamath Basin region along the California-Oregon border.

Money is intended to help farmers implement assorted conservation practices to create savings in groundwater or surface water resources.

The area's farmers have received increased attention from the federal government since their problems in 2001. Interior Department officials restricted water from the basin in order to protect endangered species of fish, resulting in severe crop losses to area farmers.

A cabinet-level working group has since tried to deal with the agriculture related concerns of farmers, ranchers, fishermen and others in the region.

Feds alter farm aid policies

The Agriculture Department will allow farmers to use the Crop Revenue Coverage price election when determining the payment cap used on disaster aid payments.

Agriculture officials worked with the Office of Management and Budget to reach the decision, which officials say will benefit farmers and ranchers who suffered financial losses due to drought but were not fully compensated for their losses.

Sen. Pat Roberts, R-Kan., said the change in policy makes disaster aid "farmer friendly." At issue were payment caps in this year's aid package. Farmers who had purchased crop revenue coverage or other insurance would have had any such assistance deducted from their overall federal disaster payments. "I am pleased that producers will not be penalized for being good managers," Roberts said.

Produce co. wants federal license

A subsidiary of California-based Aquentium Inc. said Thursday it has applied for a perishable agricultural commodity license from the Agriculture Department.

Food Safe Inc. wants the license so it will be able to conduct both domestic and international produce business.

The company has developed procedures to kill pathogens and bacteria, while also extending the shelf life for fruits and vegetables. They also remove pesticides.

Drought drops ag real estate market

University of Nebraska researchers found their state's agricultural real estate market has declined slightly due to drought.

Officials said land values and cash rental rates would have been equal to, or above, last year's levels, if not for the extremely dry weather conditions that have ruined many farm crops.

They note land values have declined only twice in the past 16 years. Agricultural economist Glenn Helmers said, "The slight decline in 2003 values is not strong evidence of a leveling off in the generally increasing trend in land values."

Grains mixed on CBOT

Grain futures were mixed at the close Thursday on the Chicago Board of Trade.

Soybeans rose due to supportive export figures and a solid crush report.

Corn rose slightly as traders tried to position themselves prior to Monday's scheduled planting and stocks reports from the Agriculture Department.

Wheat fell slightly on weather conditions that could boost the size of the crop this growing season.

Oats were mixed.

The prices:

Soybeans: May 5.80 1/4 up 11 1/4, Jul 5.77 1/2 up 10 3/4, Aug 5.65 1/2 up 10 1/2, Nov 5.18 3/4 up 6 1/2.

Corn: May 2.28 3/4 up 3/4, Jul 2.29 1/4 up 3/4, Sep 2.30 1/2 up 1, Dec 2.32 1/4 up 1.

Wheat: May 2.83 1/2 off 3/4, Jul 2.86 unch, Sep 2.92 off 1/2, Dec 3.01 3/4 unch.

Oats: May 1.79 3/4 up 4 3/4, Jul 1.60 1/2 up 1 1/2, Sep 1.47 1/2 off 1/4, Dec 1.47 off 1.