Ready for Change

By Annette Bertelsen, from Spring 2019 C magazine

What happens when the world’s biggest buyer suddenly backs away from U.S. soybeans? That’s been a question on everyone’s mind since July 6, 2018, when the United States implemented China-specific tariffs. The move embroiled U.S. farmers and cooperatives in a trade war that hit the soybean world particularly hard. Spring USDA data shows 2018–2019 soybean export inspections down nearly 34 percent from the year before, with farms and cooperatives struggling to handle huge carryover and reduced cash flow.

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You are invited to the 2019 CHS Owners Forums

register for a 2019 owners forum

The 2019 CHS Owners Forums will be held at 11 sites across the country in May and June. As an owner of CHS, we invite you to join us at the forum nearest you to hear business updates from CHS leadership including CHS President and CEO Jay Debertin. We will also take a look at industry trends and will be asking for your input on how we can make connections that support long-term success. Forums will wrap up with lunch at noon. Please register to reserve your spot.

CHS Drayton: Morning Market Wire

Thursday, May 16, 2019
by Eric Peterson

Market Summary

Corn traded higher overnight as forecasts continue to show wet weather in the extended forecast.  The seven-day precipitation models continue to show heavy moisture accumulations in much of the western corn belt, stretching into Northern Illinois and Southern Wisconsin. The overly wet weather continues to leave concerns about further delays in planting.  Look for mostly higher trade today on continued planting concerns.

Soybeans closed a nickel higher this morning with the July contract closing two cents off the overnight high of $8.42.  We saw some short covering overnight on wet spring planting delays.  Later planted soybeans do not yield as well as early planted soybeans.  However, gains continue be limited on uncertainty about acres being shifted form corn to soybeans.  Look for higher trade today on spillover strength from the corn market.  The long term outlook still looks bearish as we remain over supplied with not enough demand.          

Spring wheat traded higher overnight with the July contract closing at the overnight high of $5.23.  The market found support overnight on spillover strength from corn.  Additional strength in wheat is likely due to short covering in the Kansas City and Chicago markets.  Look for higher trade today on short covering and strength from corn.  

Compass contracts are a great way to market your new crop by pricing grain daily at a fixed higher futures price.  Below are today’s closing bids for two types of compass contracts we offer.  If you would like to make an offer or would like more information please give me a call at the office.  (All compass contracts have a 48 hour probation period.)

Price
Builder Bonus
Daily
Price Plus
Futures
at
8:00am
SH20 (Mar) $9.42
$9.05

$8.87
CH20 (Mar) $4.28
$4.18

$4.05
MWH20 (Mar) $5.84
$5.69

$5.52

Below is the third compass contract we offer which pays you a premium for your old crop for potentially selling the same amount of new crop.  You only sell the new crop if the futures are equal to or greater than the target price on the trigger date.  There are many different premiums and target prices available. Please call for more info!


Old Crop Premium New Crop Target Trigger Date
0.10 5.65 MWH20 2/22/2020
0.21 9.00 SX19 10/23/2019
0.17 4.10 CH20 2/22/2020

Futures markets as of 8:30 AM
Minneapolis Wheat: MWEN19 5.23 +0.07
Kansas City HRW: KWEN19 4.10 +0.08
Soybeans: SN19 8.40 +0.05
Corn: CN19 3.75 +0.05

CHS Drayton Cash Prices
Spring Wheat: 4.63 -0.60 basis May Delivered Drayton
Winter Wheat: 3.30 -0.80 basis May Delivered Drayton
Corn: 3.25 -0.50 basis May Delivered Drayton
Soybeans: 7.23 -1.17 basis May Delivered Drayton

Spring Wheat Protein Scales

-.02 cents ea. 1/5 down from 14.0% to 13.0%

-.02 cents ea. 1/5 down from 13.0% to 12.0% (Max -0.20)

+.02 cents ea. 1/5 from 14.0% to 15.0%


Any information, materials and opinions (together, “CHS Materials”) presented by CHS to the recipient of such CHS Materials, whether in written or oral form, is for general information purposes only and does not constitute legal or other professional advice and should not be relied on or treated as a substitute for specific advice relevant to particular circumstances.  CHS makes no warranties, representations or undertakings, whether express or implied, about any CHS Materials (including, without limitation, any as to the quality, accuracy, completeness or fitness for any particular purpose of any CHS Materials). Recipient agrees that CHS shall not be liable to recipient relating to or resulting from the use of any CHS Materials or any inaccuracies or errors therein or omissions therefrom.

Check for underground utilities before digging

Whether your spring to-do list includes building a fence or planting trees – breaking ground should always be done with caution. April is National Safe Digging Month so remember, your best line of defense before digging is to call 811, a free service that marks underground utilities and pipelines. Many of these are less than a foot underground. 

The process is simple: Call 811 or visit clickbeforeyoudig.com three days before a digging project, wait for underground utilities to be marked and don’t dig within two feet of those markers.  

digging

It’s best to call 811 any time you break ground, even if you think you know where a utility line is located. “In the U.S., an underground utility is hit every nine minutes, causing dangerous consequences,” says Tina Beach, public awareness specialist for CHS. “It takes a lifetime to build a farm, and it takes just one free call to keep it safe.”  

3 equipment tips to get the most out of a short planting season

Planting Equipment Tips

By Mimi Falkman, senior marketing specialist, CHS Lubricants

Planting season is always a busy time of year on the farm, but it can be especially tight when winter overstays its welcome. A short spring means there’s even less time than usual for farmers to complete some of the most important work of the year.

During a condensed planting season, equipment is under added stress because it needs to work overtime to meet demands. To keep machines protected and operating at peak performance during a shorter spring, farmers can set themselves up for success by preparing their equipment and fluids while the fields are still wet.

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CHS reports $596.3 million of net income for first six months of fiscal 2019

CHS Income

CHS Inc. reported net income of $248.8 million for the second quarter of fiscal 2019 and $596.3 million for the first six months of fiscal 2019.

“Our strong performance in the second quarter reflects our hard work at serving our owners and other customers better. We’ve refocused on serving our customers and improving our operations, and that has shown positive results in our financials for the first half of fiscal 2019,” said Jay Debertin, CHS president and chief executive officer. “Our performance also reflects the benefit of a diverse platform across business units that serves our cooperative and farmer-owners.”

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Recognize, respect risks associated with grain handling

Grain powers American agriculture. During Stand-Up for Grain Safety Week, March 25 through 29, we want to remind everyone working on farms and in grain-handling facilities to respect and understand the risks associated with working with grain.

“It’s important to continue to work with the industry, our employees and our farmer-owners on the hazards in the grain industry, while stressing safe practices and controls to ensure their safety,” says Matt Surdick, manager, Country Operations Environment, Health and Safety, CHS.

Stand-Up for Grain Safety Week was organized by the National Grain and Feed Association (NGFA), the Occupational Safety and Health Administration (OSHA), the Grain Elevator and Processing Society, the American Feed Industry Association and the Grain Handling Safety Coalition.

The groups remind us to remember five steps to grain safety:

  • Never walk down grain
  • Guard elevated work surfaces
  • Watch for moving equipment
  • Safeguard moving equipment
  • Lock out equipment

Moving or flowing grain acts like quicksand and can bury a person in seconds. From the time an auger starts, a person has two to three seconds to react. In four to five seconds, a person is trapped. In 22 seconds or less, the person is completely covered by grain. Grain bin incidents often result in multiple fatalities because coworkers improperly attempt rescue procedures and become engulfed themselves.

“Following procedures, evaluating your surroundings, using proper equipment and ensuring constant communication are keys to entering and exiting a grain bin or silo safely,” Surdick says. “Do it the right way, every time.”

Be aware of bridging grain, which occurs when grain clumps together due to moisture or mold. These conditions can create an empty space beneath the grain as it is unloaded, which means it can collapse unexpectedly or under a person’s weight. Do not enter a bin when there is a bridging condition, or if grain is built up on the side of the bin.

Always monitor the atmosphere inside bins for dangerous changes. Make sure there two people are always present when working in bins and maintain communications between the attendant outside the bin and the person inside the bin.

Never move grain into or out of a bin while someone is inside. Lockout/tagout all mechanical, electrical, hydraulic and pneumatic equipment that presents a danger, particularly grain-moving equipment.

A bin of grain may seem harmless, but in just seconds, that harmless grain can claim a life. Please be safe and share these messages with anyone working with grain.

Join the fight against rural hunger

People in rural communities live surrounded by growing food, but they experience hunger too. That’s why CHS is once again teaming up with local farmers to fight hunger in rural America. The CHS Harvest for Hunger food, grain and fund drive begins March 1 and continues through March 20 at your nearest CHS location.

“We might never know that the neighbor across the road or down the drive struggles to put food on the table, but through our efforts this month, we can make sure those local food shelves can anonymously help those who need it most,” says Rick Dusek, executive vice president, CHS Country Operations. “For nine years now, our CHS employees and farmer-owners have stepped up during this annual campaign to help local and regional food shelves feed those in need.”

Since 2011, CHS has raised more than $5.6 million and 3.6 million pounds of food through its Country Operations business units. CHS locations across the United States have organized ways to get farmer, ranchers, employees and community members involved in fun and interactive ways to raise food and funds to fight hunger.

Financial donations are encouraged as they give food banks additional buying power to provide nutritious food at deeply discounted rates; $1 equals 6 pounds of food for area food banks. But food and grain donations are also accepted. Every donation counts.

“All the food, money and grain raised by CHS Harvest for Hunger goes directly back to local and regional food banks to help fill their shelves,” Dusek says. “This way, we can help those in need by ensuring those organizations dedicated to fighting rural hunger have the resources they need to make a real difference in people’s lives.”

Stop by or contact your nearest CHS location to learn how you can support CHS Harvest for Hunger.

It Takes Talent to Feed the World

By Nanci Lilja, President, CHS Foundation

When most people think of agriculture, they wonder how we are going to feed the growing population of 9.6 billion by 2050. And while that’s an important question to consider, I find myself thinking more often about the individuals needed to fill the talent pipeline to feed that growing population.

With nearly 4 in 10 agriculture jobs going unfilled each year and the average-age of farmers ever increasing, it’s going to take a pragmatic, creative approach to encourage young people to pursue careers in agriculture.

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© 2019 CHS Inc.