U.S. Pork producers are looking for some long-term relief in the corn supply and demand situation. They began their efforts in earnest in March when the National Pork Producers Council sent representatives to Washington, D.C., to ask for the release of non-sensitive Conservation Reserve Program acres. Producer delegates attending the 2011 National Pork Industry Forum signed letters in support of the idea, which were delivered to USDA Secretary Ton Vilsack.
The non-sensitive acreage would equal an estimated 4 million to 8 million acres, and the ground would require some refurbishing to get it back to a productive. A decision would be needed by fall in order to contribute to the 2012/2013 crop year.
The response has been a chilly one, and USDA has shown little interest in the idea. In fact, the National Grain and Feed Association and the National Chicken Council have stated that the USDA has “’refused to use its existing authority under the 2008 farm law to waive CRP penalties, further justifying legislative action.’”
Now, more than 70 groups comprised of livestock producers, feed processors and exporters are asking House and Senate Agricultural Committee leaders to work on making more acreage available for the growing grain and oilseed demand. They want Congress to address the issue in the 2012 Farm Bill, making it easier for farmers to opt out of the CRP.
USDA’s own monthly Supply and Demand Report released on May 11, won’t likely help matters, as it shows a larger than expected overall supply of corn, soybeans and wheat.
Specifically, USDA reported old crop corn ending stocks at 730 million bushels, up from the 675 million in April, citing considerable declines in export sales. The first official 2011/2012 projection for ending stocks was 900 million bushels, nearly 100 million bushels higher than trade expectations.
The projected carryover for old crop soybeans is 170 million bushels, up from April’s 140 million, as export demand backed off with South American supplies entering the pipeline. The first estimate for new crop soybeans is reported at 160 million bushels, the trade expected closer to 170 million bushels.
Still, that supply scenario is not exactly abundant. Given the dramatic demand increases and the U.S. growing season lies ahead, much concern remains. Consequently, the CRP issue will not be laid to rest easily.
In a letter to Senate Ag Committee Chairman Debbie Stabenow (D-Mich.) and House Ag Committee Chairman Frank Lucas (R-Okla.), the 70 groups emphasized that the grain and oilseed supply is not solely a U.S. issue, but a worldwide concern. The groups included a paper by the independent consulting firm—PRX-- that outlines major risk factors for global grain supplies. The letter points out that PRX concludes “the world may well be short of grain supplies going forward and needs some plan of action.”
Among the groups signing the letter are the National Pork Producers Council, National Grain and Feed Association, American Bankers Association, Pet Food Institute, U.S. Poultry and Egg Association, National Turkey Federation, Perdue Farms, Tyson Foods and a vast array of state commodity and farm organizations.
You can read the letter online, and scan the list of participants.