Morrow County Grain Growers                             Pendleton Grain Growers

             Duane Disque or John Ripple                                      Jon Sperl

             1-800-452-7396 or 541-989-8221                           1-800-422-7611 or 541-276-7611

              or Dan Steiner 481-6614 (office), 571-3798 (cell)  graingrowers@centurytel.net

                                                            GOOD MORNING!!!

            Below are the best indicated market bids as of:   9:00  on      5/9/08

***NOTE: Corn values vary depending on delivery location PLEASE call for updates. I will be OUT NEXT WEEK. PLEASE CALL the office for updates. I will be checking/ returning messages. With a TON of stuff to go over this morning, it will be a 2 pager with attachments! 1) Crop Conditions, and 2) USDA’s new S&D’s for 2008-09, FAX customers PLEASE call if you want attachments. There are 4 pages.

            Sales report yesterday showed weak sales for corn with only 15.8 myn bu sold. In total wheat did ok with 18.1 myn bu but 11.1 myn bu of it was N/C. Funds bot 7m caks of wheat yesterday and OI in corn jumped a whopping 13m caks. 24 Senators (pretty much all from corn USER states, or oil rich states like Alaska/ Texas) sent a letter to EPA asking for a 1 year waiver on the RFS. I doubt it will happen, BUT even if it did, today the ethanol margins are big enough that corn will still get ground to ethanol anyway. What is at risk is the .51/ gal blenders credit, and perhaps the .54 import duty. Both of these probably need to be trimmed away anyhow, setting up the day when ethanol can stand alone.

Farm Bill: Congress says they are done and are hoping they have the numbers needed to make it veto proof…they will likely need it as the prez sez he WILL veto it. Harkin said that if he did “he would destroy harvest just as the seeds are being planted”. It should be noted that the Farm Bill is 7 MONTHS OVERDUE. Here are some of the things as they pertain to us: A  reduction of the adjusted gross income cap for those who can qualify for direct payments from $2.5 million to $750,000 for farmers and $500,000 for nonfarmers. In addition, it includes a countercyclical farm program based on farmers' income rather than prices; tightens up on farmers' ability to choose a commodity's lowest price day on which to claim loan deficiency payments. It also reduces the amount of losses farmers can claim against nonfarm income to $200,000, sets a $1 million cap on the adjusted gross income of conservation payment recipients, which Conrad said would not affect people who get two-thirds of their income from farming. The Bush administration has advocated stricter payment caps on commodity payments, but did not propose a stricter cap on the incomes of conservation payments recipients. The bill has not been scored yet but is estimated to top $300 billion over five years. While we are on the Farm Bill: NUTRITION has been expanded and now accounts for 73.5% of this Farm Bill (last bill was 66.66%. US Farm subsidies are ONLY 16.1% of the total FARM BILL.

Kansas crop tour is over with the tour estimating 379 myn bu of prod vs. 284 lyr. They est’d yields at 43.3 bpa. Okie is proj. to produce 160 myn bu, and Tx 100 myn. While we are at it, lets look at the new S&D’s. There were some MAJOR revisions, but not a terrible lot of surprises. We mentioned here a couple months ago what might wheat prices look like if the world increased production by 1.4-1.6 byn bu? We are about to find out. Latest revision is UP another 165 myn bu from last month, and whopping 2.08 byn bu BIGGER than last year! (See Crop Condition attachment). US wheat S&D’s. First of all the first ‘By Class’ S&D’s will be presented by USDA on 7/11 so our S&D’s “by Class” is the most current version…NOT an estimate of ’08-09. US WHEAT acreage is seen UP 3.4 myn acres and HARVESTED acres UP 5.3 myn acres (less abandonment, hayed, grazed). Beginning stocks are lower, feed usage up 120 myn bu (SRW and probably some SWW) and overall exports DOWN 250 myn bu. Ending stocks increase to 447 myn bu or a very comfortable 21% Stox: Use.

Now for the ‘big dog’…Corn saw some dramatic shifts, and it is because of these we will be watching corn even more closely than before for market direction on wheat. FEED usage is seen DOWN  650 myn bu! FOOD, SEED, Industrial is UP 805 myn bu (increased ethanol grind is 800 myn of this)! Exports are projected DOWN 300 myn, and Total use is down 195 myn bu. All this translates into corn c/o of ONLY 763 myn bu…or 53% of Lyr, and a stox to use of only 5.9%.

Right now traders are selling corn (down 3-5) and wheat (down 24-25) and buying beans up 28-30.

Argie strike is back on. No surprise there, only thing left now is to see how this plays out. The position the Argie gov’t has carved out does not look like a position that would encourage future growth in Ag, and in fact could be seen as pretty negative for most industries. As ocean rates continue to rise there is talk of a severe container shortage. Ports are jammed with US production that can’t get loaded and shipped.

***Didja Know: The Chinese gov’t is battling the bulge. OVER nutrition for city workers, and mal nutrition for those in rural areas. Gov’t is finding it hard to keep people in AG, producing the crops. Ranchers in Estonia (S. of Finland on the Baltic Sea) received “Gas” tax notices on cattle.  Canned herring were first called ‘sardines’ because that’s where they were first canned. Nacho’s are said to be the most preferred food for pregnant women, not pickles…Kangaroos can not walk backward. Most dreams last 5-20 minutes. The IRS tax manual has procedures for collecting tax AFTER a nuclear war. Washington DC has 1 lawyer for every 19 citizens.

                                                HAVE A GREAT WEEKEND!!!