Coming up on Market to Market -- Tom Vilsack returns to D.C. at President Biden's request.

Questions for the former Secretary covered familiar territory and new ground.

A new way of tracking insects and diseases that threaten crops.

And market analysis with Mark Gold, next.

♪♪ What's the most complex industry on Earth?

It's not genetics, or meteorology, or logistics.

It's a business that involves them all.

It's farming.

Thank you, farmers, from Pioneer.

Sukup Manufacturing Company -- providing equipment and buildings to store and condition grain to help farmers adjust to market swings.

We build drying, moving and storage equipment designed to preserve the quality of their crops.

Sukup Manufacturing -- store now, profit later.

♪♪ Tomorrow.

For over 100 years we have worked to help our customers be ready for tomorrow.

Trust in tomorrow.

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♪ This is the Friday, February 5 edition of Market to Market, the Weekly Journal of Rural America.

♪♪ Hello, I'm Paul Yeager.

A slimmed down Super Bowl means less fans in stands, nights in hotels and even fewer watch parties.

That translates locally to less money into the hospitality industry.

The pandemic has limited the overall economy - including the recovery in the employment sector.

The U.S. economy added 49,000 jobs in January, off forecast, but a reversal from last month when the workforce shrank for the first time since April.

The unemployment rate fell to 6.3 percent, according to the Labor Department.

The decline was due, in part, to a reduction in those looking for work.

For the 8th straight month, the Mid-America Business Conditions Index is above growth neutral - its highest in almost 10 years at 67.3.

The conditions inside the nine-states surveyed by Creighton University lean heavily on agriculture.

This week, Tom Vilsack again appeared in front of the Senate Committee he testified in front of several times during his 8 years as Secretary of Agriculture.

We have two reports about the hearing this week as Vilsack was peppered with questions on issues from his previous service and ones that have come up since his time in the Independence Avenue office.

John Torpy leads off our coverage.

Earlier this week former Secretary of Agriculture Tom Vilsack began the process of becoming the current USDA Secretary for the Biden Administration.

Appearing virtually before the Senate Agriculture Committee, Secretary Vilsack fielded questions on a wide range of issues.

Sec.

Tom Vilsack, Nominee, Secretary of Agriculture: "“I think we are faced today, uh, with a number of why not opportunities and moments in agriculture, uh, in the food industry, uh, in a rural America.

"” Midwest senators pressed Vilsack on his vision for the future of biofuels, as the demand and availability of electric vehicles continues to rise.

Sec.

Tom Vilsack, Nominee, Secretary of Agriculture: "“I think we can make the case, should make the case, and will make the case that there is a role to play for biofuels in climate, in reduction of emissions.

Some COVID-19 related items brought up by the U.S. Senate Agriculture Committee centered on meat processing facilities and fair pricing for cattle producers.

Sec.

Tom Vilsack, Nominee, Secretary of Agriculture: "“I think we need an alternative processing opportunities.

Why not, just from the competitive standpoint, but also from a resilience standpoint.

We found that when one or two processing facilities, uh, shut down during COVID, that it just, it, it created havoc in the market.

We can't have that.

"” The topic of food insecurity also was on the table as Vilsack shared where he would strengthen USDA programs to help fight hunger.

Sec.

Tom Vilsack, Nominee, Secretary of Agriculture: "“I mean, it's all well and good to give somebody a SNAP card and say, '‘go to your local grocery store and buy more, more food.'

That's great.

Assuming you have a grocery store, but if you don't have a grocery store, then what.

"” Incoming Senate Agriculture Committee chairwoman Senator Debbie Stabenow, a Democrat from Michigan, asked Vilsack about his plan for addressing claims of discrimination within USDA.

Sec.

Tom Vilsack, Nominee, Secretary of Agriculture: "“We need to fully, deeply and completely address the long-standing inequities, unfairness and discrimination that has been the history of USDA programs, uh, for far too long to a future where all are treated equitably, fairly.

Where there is zero tolerance for discrimination, where programs actually open up opportunity for all who need help and lift the burden of persistent poverty for those most in need.

"” For Market to Market, I'm John Torpy.

A common question from Senators at Secretary of Agriculture Tom Vilsack's confirmation hearing was about the Biden Administration's proposed emphasis on regenerative agriculture and carbon sequestration.

The Secretary argued that consumers want to know not simply what is in the food they eat, but how it was grown and raised, and whether sustainable practices were used.

Sec.

Tom Vilsack, Nominee, Secretary of Agriculture: "”So to the extent that we can make the case to the world, that what's being raised, what's being grown, what's being sold outside the U.S. is being raised and grown in the most sustainable, animal-friendly environments.

We can make a case and provide a market advantage to the U.S."” The Biden administration could use the Commodity Credit Corporation to create a carbon bank, a fund to pay farmers to store carbon in their soils.

The storage would be done through a variety of tillage and cropping systems.

The carbon bank would eventually pay farmers with funds paid by companies that release carbon into the atmosphere.

The project would operate as a cap-and-trade system by putting a price on carbon emissions, in an attempt to discourage further output, rewarding companies that either reduce their carbon footprint or find ways to remove carbon from the atmosphere.

A carbon bank could potentially give farmers another revenue stream separate from the performance of their crops, and reduce their dependence on Federal dollars to maintain profitability.

For Market to Market, I'm Peter Tubbs The dashboard view of almost any topic has become a popular way to analyze and contextualize data.

An effort to locate concentrations of various pests and diseases may not be your ideal time on the internet, but it is for those looking at the effectiveness of pesticides.

Colleen Bradford Krantz looks at the efforts to better understand and fight the insects damaging livelihoods around the globe.

This locust infestation in East Africa was already unusually large in 2019.

Weather conditions continued to be ideal for the short-horned grasshoppers and their numbers grew exponentially the following year.

Keith Cressman, United Nations Food and Agriculture Organization: "“There are swarms that are - it's not uncommon to be, let's say the size of Manhattan in New York City.

So they can be very big.

In one day, that swarm can eat the same amount of food as everybody in New York and California combined.

"” It's this kind of infestation - if it were to occur on U.S. soil - that Plant Protection and Quarantine, a unit within the U.S. Department of Agriculture, would be charged with monitoring and managing.

This team of experts have spent the last few years improving their data-analysis and mapping tools.

The hope is to more precisely pinpoint problem populations of crop-damaging insects, as well as plant diseases, before they get out of hand.

Matt Royer, Deputy Administrator, Plant Protection and Quarantine: "“Most organizations these days are interested in creating dashboards and ways of viewing data so you can look at, you know, pie charts, you can look at pictures, storyboards, anytime information and share them.

And the technology has matured to the point where we can make this more readily available.

"” The Plant Protection and Quarantine dashboards are helping federal officials, who are working in tandem with state plant health experts, to decide where a limited amount of money should be spent to stop insect or bacterial disease threats to row crops.

The moment a local official counts insect populations and enters the numbers into a database, it instantly becomes part of a larger pool of information.

Matt Royer, Deputy Administrator, Plant Protection and Quarantine: "“If you go back two years, we would have had pencil on paper more.

We are going toward electronic data collection.

You could imagine when you have pencil and paper and are transcribing to computer, there's opportunity to err.

And I think one-time collection helps reduce that.

"” Royer's team says the dashboard interface can help with locating concentrations of various pests and diseases, as well as being used to pinpoint activity in a specific geographic location.

Derek Witt, Plant Protection and Quarantine: "“So what we're looking at here on this dashboard for the grasshopper and Mormon cricket program is obviously a wealth of different metrics related to treatments and surveys, but then the mapping component really adds another dimension of ability to dig into the data.

"” The maps generated from the database can also be used to evaluate the effectiveness of the previous year's pesticide treatments.

Derek Witt, Plant Protection and Quarantine: "“We can zoom over to Wyoming and see that for the areas we treated last year.

Whereas last year this area was just peppered with reds and oranges, we were able to get in here and it looks like, for the most part, the treatments were successful because we now have dark blues, blues.

"” Just like long-term weather forecasts, Plant Protection and Quarantine officials can predict which areas might have the most trouble with a particular pest or plant disease in the coming months and years.

Derek Witt, Plant Protection and Quarantine: "“Generally how it works is we have our state plant health directors...submit requests for treatment, knowing or having a pretty good guess that we are going to have a very high density or destructive grasshopper year...As you can see, we've already dug way down into the data just to see this stuff in Eastern Montana...up here on the Flathead Indian Reservation and over in other parts of Eastern Montana, we had high nymphs grasshopper populations, which are areas you want to treat because nymphs obviously grow into adults and then the cycle goes forward.

"” Eastern Montana ranchers can attest to the accuracy of the dashboard data, especially where it applies to grasshoppers.

Jason Pluhar, Pluhar Ranch Co., Cohagen, Montana: "“We had the most grasshoppers I've ever seen, since I've been around.

But I'm only 30 years old.

My grandfather is 76 and said it was either the most amount of grasshoppers he's ever seen or there might have been one other time in the '‘60s when he's seen this many.

Last summer, the federal government added an additional $2.8 million to the original $2.6 million for grasshopper and Mormon cricket management in Montana and seven other states.

Jason Pluhar, Pluhar Ranch Co., Cohagen, Montana: "“I'd walk out my front door and through my yard and I bet I had billions in my yard.

It was just ridiculous how many there were...Out in the pasture, the wheat was bad for part of the year and then as it kind of matured, they went back onto the alfalfa field and destroyed them.

"” The Pluhars, who raise cattle, wheat, barley, corn, and hay, estimate they lost nearly 40 percent of their hay crop due to the double punch of a dry season and grasshopper damage.

Pluhar likes the idea of the government improving the speed and accuracy of pest population tracking and predictions.

Jason Pluhar, Pluhar Ranch Co., Cohagen, Montana: "“I think it would help.

If you could track them and kind of know where they are going to hit, people can plan ahead and maybe plant more hay crops if they have livestock or be prepared to spray more...Anything to help prepare, you know?

"” While the dashboards are, for now, primarily intended to be internal tools for government officials, PPQ has made some data available to the public.

Matt Royer, Deputy Administrator, APHIS' PPQ: "“The whole effort is trying to be more efficient at collecting data, managing data and sharing it.

"” For Market to Market, I'm Collen Bradford Krantz.

Next, the Market to Market report.

The export totals for U.S. corn set a record, keeping the bulls somewhat fed as part of the trade.

For the week, March wheat dropped 22 cents while the nearby corn contract gained 2 cents.

Soybeans stayed near recent highs as the weather turned wetter in South America and export news kept moving on the ticker.

Nearby soybeans fell 3 cents.

March soybean meal declined 50 cents per ton.

March cotton expanded by $2.10 per hundredweight.

Over in the dairy parlor, March Class III milk futures gained 6 cents.

In the livestock sector, April cattle improved $1.93.

March feeders added 55 cents.

And the April lean hog contract gained $3.65.

In the currency markets, the U.S. Dollar index rose 48 ticks.

March crude oil increased $4.80 per barrel.

COMEX Gold declined $41.30 per ounce.

And the Goldman Sachs Commodity Index jumped nearly 21 points to finish at 452.75.

Yeager: Now here to provide insight is one of our regular market analysts, Mark Gold.

Hello, sir.

Gold: How are you today?

It's good to be back.

Yeager: Good to see you.

I've got a question about this whole wheat thing.

Is this all about sympathy to corn?

Or is there an underlying story that is happening somewhere else?

Gold: Well, it may be that we're seeing that some cattle feeders are switching their feed ration to wheat.

Wheat has got a 10% protein premium over the corn and that may be happening out here.

The funds are basically even in the wheat.

Some people have a little short, some people have a little long.

But they're long, looking at today's commitment of traders report, somewhere around 350,000, 360,000 contracts in corn.

So I think what we saw today anyway was selling corn, buying some wheat against it.

But the wheat, we've got very, very cold temperatures out here in the Midwest.

We believe that there is enough snow cover to minimize any winter kill damage out there.

So this rally that we've seen, and we see these rallies every day or so, every other day in the wheat market, it's hard to justify when you've got plenty of wheat around the world.

The Russians haven't stopped exporting as we saw with the Egyptian tender.

So maybe this was just the case of feeders looking to buy more protein and buying the wheat.

Yeager: So if you are sitting on any of the wheat contracts that you watch, Minneapolis, Kansas City, Chicago, would you be making some sales right now, Mark?

Gold: Well, in old crop absolutely.

Sell whatever you want.

Buy back a $7, $9 call spread in case something really screwy is out there.

But my guess is you'll lose the money on the call but be pretty happy with where you make the sales.

This is -- if you don't want to make any cash sales up here for whatever reason then at least buy some puts to protect the downside.

But it's a great opportunity to do some marketing.

Yeager: Mark, if you weren't paying attention to the daily ticker, let alone the end of the day, forget the overnights, you would think we just stood in place all week in the corn market.

But it was anything but that.

There was some down, there was some up and Friday as we opened dramatically higher and then it fell apart.

So we have this huge amount of export sales that helped us for a day.

But why could that not keep this market any higher?

Gold: Well, I think we've priced a lot of it in.

The number was so big, I think it was 7.4 million metric tons.

The old record was 4.7 back in '91 when the Russians were buying corn.

It's a huge number.

Certainly we're going to be reducing the carryouts from the supply and demand report Tuesday.

How much?

100 million bushels, 200 million bushels, maybe more.

But we've already priced a lot of this into this market.

We're at $5.50 old crop corn.

We're at $4.50 new crop corn.

Are we going to go see $6 old crop corn?

It's possible if this report is friendly on Tuesday.

But it seems a little bit less likely.

We threw some awful good news at this market and when you have a 7 million metric ton plus export figure and you don't rally on that, I think you've got to question it.

Yeager: My neck gets tired from the whipsaw of things and it's pretty easy to get emotional when you're holding onto grain.

You've heard the farmer tell you, Mark, time and time again, they get emotional about things.

How do you not get emotional and try to make a sale?

And at what price would you make a sale here this week?

Gold: There's nothing wrong at looking at profitability to take the emotion out of it.

And when you look at whether it's old crop corn or beans or new crop corn or beans or wheat, old crop or new crop, things are pretty profitable that we haven't seen in years out here.

And that should help you take some of the emotionality out of it if you just look at the profitability.

And to me, as a marketer, sell whatever you want, buy back calls to keep the upside open or buy the puts.

It doesn't have to be a tough game.

If you get caught up in these whipsaws, corn opens 10 lower, closes 10 higher, opens 15 higher, closes 15 lower, you're going to blow your brains out trying to out-trade this thing.

And to me, you make one or two trades and be done with it and let the market do its thing and watch where it goes.

But be in a position to take advantage of it.

And right now the funds are so long corn you have to do something out there.

Yeager: What is the thing happening in the soybean market?

It's some of those same elements that you just talked about with corn.

Gold: Well, we first saw it in the beans with the Chinese buying the beans.

And they have been fairly relentless.

They want the meal to feed the hogs, they want the corn to feed the hogs.

They have backed off a little bit here.

But we're still seeing weekly numbers 1.3 which aren't bad.

So there's still plenty of demand.

You look at the crush numbers, it was like close to 194 this month or back in January.

That is a huge crush number for the beans.

So we've got good demand out here, we've got good demand for our products and until we see the Brazilian crops and the South American crop, the Argentinean crop hit the markets and actually get into port and get out of port, we're the game in town.

So you don't want to get to bearish here and watch this truck strike last another three weeks or the wetness continues in Brazil and they can't get the crop out.

They'll get the crop out, they'll end the strike.

But in the next two or three weeks who knows and if the report is bullish on Tuesday and we still have the strikes and Brazilians can't get the beans out of the field, we can certainly move this thing higher, there's no question about it.

Yeager: I want to take a question from Phil in Dresden, Ontario and he's asking a question that we've talked about several times and it's in acreage.

He says, with China's exchange pricing corn at approximately $10.92 a bushel and corn exports robust into China, will the U.S. plant enough corn acres this spring to satisfy demand and maintain prices?

Or will the soybean acres win out?

Gold: Well, I've seen estimates as high as 97 million acres on corn.

The bean numbers, you look at the corn to bean ratio, it's about 2.6 on new crop beans and corn right now, certainly an incentive to plant some beans.

But I think it's going to be the case, as it always is, what is the weather in the spring?

If we've got great weather in the spring, farmers are going to get in and plant corn.

And they'll plan 95, 96 million acres of corn and the rest will go into beans.

Farmers love to grow corn, raise corn, harvest corn.

So I don't know that it's a matter of economics per se.

There's a lot of emotion involved in that.

But these prices are good, $4.50 corn and $11.50 beans, nothing to turn your nose up at.

But I think price wise the beans are favored but emotion wise the corn is favored.

But can we grow enough?

If we have a good growing season this year with acres there will be plenty for everybody.

Yeager: I want to flip the script on livestock and start with the hog industry, the hog contract.

They had a really good week.

You mentioned just a minute ago about China buying a lot of the U.S. feed for their industry.

Even as it grows in China they're still wanting to buy from us.

How is that impacting and translating to the American pork producer right now?

Gold: Well, pork producers, the production of pork is way down.

That's why we're seeing back months of hogs, June hogs, just shy of $90 on Friday.

That's a lot of resistance here between $89 and $91 but if we start closing over $90 I think we're going to take a look at $100, maybe $100 hogs out here.

So the hog market has been very strong.

I think we have to keep in mind the days we're living in here.

These are the days of extreme volatility, GameStop and everything else money flowing in, money flowing out, let's get it, let's get out of it.

But I think there is a chance that people might want some hogs here, the Chinese still need hogs.

They have done a remarkable job of rebuidling the herds but they still need some work.

Yeager: The volatility was not quite there in the cattle industry at week's end but it still is there from week to week.

As this economy looks to coil, spring forward, whatever term you want to use, what do you like about the cattle market Let's talk April cattle first.

Gold: Well, the cattle market has had that gap up there at $120, $119.75 forever on the Feb contract, it was right around there on the April as well.

I think we can try to go up and fill those gaps.

The stock market has remained incredibly resilient out here.

And if people feel like they've got money in their pockets and they just passed the COVID bill a couple of hours ago, more people have some more dough in their pockets, that's all good.

We have just pent up demand for beef in this country, in my opinion.

Once I had my COVID shot yesterday, more people are getting it every day.

Yes, I'm in the 65 and older class.

But you younger folks are going to take a while.

But the fact of the matter is, the more we open up this economy, Illinois restaurants have opened partially again, there's going to be a pent up demand for meat.

And if you look at what has happened with box beef in the last two weeks it has been fairly straight up.

I think we had one day correction out here.

But it has been incredibly strong and I think that is an indication that the economy is okay.

Yeager: All right, Mark, final 30 here on the feeder market.

You mentioned off the top about wheat as a feed substitute.

That's what they're trying to do is pencil things out, right?

Gold: I think so.

And with the feeder cattle market, if corn continues to work higher it's going to be tougher on feeder cattle.

But I think the fat cattle market has got a chance here.

You look at the back months of the feeder cattle, they're awfully high prices.

Yeager: All right.

Mark Gold, when we come back in Market Plus we're going to talk about if you had a 40 to plant as well as cotton.

Thank you, Mark.

That will do it for this installment of Market to Market.

We will talk more in Market Plus, as I just mentioned, so make sure you join us there.

Find that on our website of MarketToMarket.org.

Also on that site you'll find more than the stories you just saw on TV and other information that we compile each week for your reading in addition to our videos and transcripts.

Next week, a look at the dairy industry's last 12 months that have mirrored other commodities.

Until then, thank you so very much for watching and have a great week.

♪♪ ♪♪ Market to Market is a production of Iowa PBS which is solely responsible for its content.

What's the most complex industry on Earth?

It's not genetics, or meteorology, or logistics.

It's a business that involves them all.

It's farming.

Thank you, farmers, from Pioneer.

Sukup Manufacturing Company -- providing equipment and buildings to store and condition grain to help farmers adjust to market swings.

We build drying, moving and storage equipment designed to preserve the quality of their crops.

Sukup Manufacturing -- store now, profit later.

♪♪ Tomorrow.

For over 100 years we have worked to help our customers be ready for tomorrow.

Trust in tomorrow.

Information is available from a Grinnell Mutual agent today.