Al6-Lancaster Farming, Saturday, April 27, 2002
GRAIN, CATTLE, HOG.
& MILK BFP
FUTURES MARKETS
Markets Courtesy of Chicago Board and Mercantile Exchange
Closing Bids: Thursday, April 25, 2002
Com
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j 204 1/4(21
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228 1/4 228 3
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238 1/4 238 1/A
-38 1/2
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245 r 245
Soybeans
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J 478(480 1/4
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478 3/4 480 1/2
♦
I
Soybean Meal
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02AUg 159.8
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03Mar 228 1/4 228 3/4 227 227 227
03Maiy[ 234 f 234 232 1/4 232 1/4 ( [232 1/4
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238 1/4[238 1/2 236 1/4 [ 236 3/4 f
245 1/2[245 l/2[245 1/2| 245 1/2
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165.41166.2 164.5[ 164.9 [~ 164.6 [3L64.8| -11
163.71161.6 162.0 161.8 f
160.8 158.6 158.9 158.8 |
joZDec;
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03
149.5
Weekly Dairy Market Outlook
Ken Bailey
Penn State
April 19,2002
Oops! Butter Imports
Actually More Expensive
• Over-TRQ rate on butter is
$0.70/pound.
• Special safeguard rate
should be added.
• Milk forecast to increase 3
percent this year.
Last week I reported that
world butter prices were just
$0.45 per pound and that the cost
of importing butter should be just
$1.22 per pound. Well, like my
forecasts, I was off just a bit.
A few sharp readers of this col
umn e-mailed that I wasn’t re
flecting the whole story. It seems
that there are two levels of tariff
or duties on butter imported in
excess- of the TRQ level (the
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244
474 1/2 473 1/2
473 1/2
475 3/4
472
465 1/2
465
462 1/2
462
468 1/2
468
472 1/2
472 1/2
474
155.6
158.0
153.0 153.1
155.3
151.9
151.8 b[152.0 a
151.6
154.0
153.3 fISO.I,
150.3 b
quota).
The “general rate of duty” is
$1,541 per kilogram, or $0,699
per pound (it is not 30.9 cents/
kilogram reported last week).
Thus I reasoned that if the world
price was $0.45 per pound and
freight was $0.09 per pound, you
could land butter in the U.S. for
something like $1.22-$1.23 per
pound. I did not, however, reflect
the “special safeguard provi
sion.”
The safeguard provision is a
duty or tariff that increases as the
world price falls. This was de
signed to prevent a surge in im
ports if global butter prices sud
denly fell, as they did this year.
The schedule I received for 2002
indicates that if the world price
of butter were less than $0.27 per
pound,the s{j|dal duty rate
231 1/2 n
243 n
245 1/2
244 1/2
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iosiri
476
477
472 1/2
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465
463
474
155.9
156.0
152.2
150.4 a
Unch
231 1/2
236 3/4
243
-14
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mm
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474
-54
476 1/2
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472 1/4
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465 1/4
-64
462 3/4 -72
468 l/2[~ -74
472 1/2| -74
474
-84
161.9
-12
158.9
-11
-8
156.0
153.1
-11
-8
152.2
' 151.9["
150.4
would be $0,411 per pound. At a
world price of $0.45 per pound
the special duty rate is $0,275 per
pound. This rate falls all the way
to zero when the global price of
butter rises to more than $1.09
per pound.
So, the correct example for a
world price of $0.45 per pound is
0.992 cents per kilogram and
$992 per metric ton. The applic
able tariffs are $0,699 per pound
for the general rate, and $0,275
for the special duty rate. Adding
freight will bring the landed cost
of imported butter up to $1,514
per pound. This does not include
other small fees for customs,
docking, inland freight, etc.
The point is, domestic butter
prices would have to be above
$1.50 per pound before it would
pay someone to import butter
from overseas.
USD A announced this week
that March milk production for
I m ***** * MIM 0 **
Lean Hogs
Date
04/24/02 *CASH* 0 444844484448 -3
04/25/02 May 02 5010 502048524972 -80
04/25/02 Jun 02 5360 545051855417 +35
04/25/02 Jul 02 5275 537051455345 +5O
04/25/02 Aug 02 5105 521049905182 +32
04/25/02 Oct 02 4310 437042204335 -20
04/25/02 Dec 02 4130 416040304095 -32
04/25/02 Feb 03 4370 442042804420 +lO
Composite Volume Open_lnt
04/24/02 7664 30933
Live Cattle
Date
04/24/02 *CASH* 0 646764676467 -60
04/25/02 Apr 02 6360 645062306380 440
04/25/02 Jun 02 5950 617559326127 4-102
04/25/02 Aug 02 6055 621759756175 4-108
04/25/02 Oct 02 6330 647562526445 4-120
04/25/02 Dec 02 6500 665264256610 +lOB
04/25/02 Feb 03 6625 677565356762+137
04/25/02 Apr 03 6745 692066606900 +l3O
Composite Volume Open_lnt
04/24/02 18319 96680
Pork Bellies
Date
04/24/02 *CASH* 0 650065006500 unch
04/25/02 May 02 6655 676764456730 +8
04/25/02 Jul 02 6785 692566006785. -20
04/25/02 Aug 02 6652 679065856730 -55
04/25/02 Feb 03 6525 656565256525 -35
04/25/02 Mar 03 6525 656565256525 -35
Composite Volume Openjnt
04/24/02 471 3596
Oats
20 select states was up 3.2 per
cent from a year ago. While this
sounds like a lot, it’s really not,
when you consider that milk pro
duction last year was depressed.
I did some computing and put
together my forecast for U.S.
milk production for the rest of
2002 (see Table 2 on the Web
site). My numbers suggest that
relative to 2001, cows will decline
only 0.2 percent, milk per cow
will rise more than 3 percent, and
total U.S. milk production will go
up 3 percent.
This should be considered a
conservative figure. My milk pro
duction forecast is up just 1.6
percent relative to milk produc
tion two years ago (in 2000).
Some of my 2002 forecast looks
like a lot of milk, but U.S. milk
production normally increases
1.7 percent each year. In addi
tion, milk consumption normally
at Jeast this much.
„ Previous Previous
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Average Farm Feed
Costs for Handy
Reference
To help farmers across the state to have
handy reference of commodity input costs
in their feeding operations for DHIA re
cord sheets or to develop livestock feed
cost data, here’s last week’s average costs
of various ingredients as compiled from
regional reports across the state of Penn
sylvania.
Remember, these are averages, so you
will need to adjust your figures up or
down according to your location and the
quality of your crop.
Com, No.2y 2.30 bu., 4.11 cwt.
Wheat, N 0.2 2.61 bu., 4.36 cwt.
Barley, N 0.3 1.85 bu., 3.96 cwt.
Oats, N 0.2 1.88 bu., 5.85 cwt.
Soybeans, No.l 4.28 bu., 7.14 cwt.
Ear Com 63.70 ton, 3.19 cwt.
Alfalfa Hay 146.25 ton, 7.31 cwt.
Mixed Hay 148.75 ton, 7.44 cwt.
Timothy Hay 121.25 ton, 6.06 cwt.
-16
-14