Private Companies 19

USA

June 23, 2017: Revillo Farmers Elevator, Inc.: DDG Prices Firm on Steady Demand

NEWS BITES - PRIVATE COMPANIES

The DTN average dried distillers grains, or DDG, spot price was up $1 per ton from two weeks ago, at $102, for the week ended June 22. Of the 39 locations from which DTN collects spot prices, 15 bids were $1 to $13 higher, seven bids were $2 to $8 lower and the balance of the prices were unchanged. The value of DDG relative to corn, based on those bids for the week ended June 22, was at 78.73%, and the value of DDG relative to soybean meal was at 34.72%. The cost per unit of protein for DDG was at $4.08, compared to the cost per unit of protein for soybean meal at $6.19.

One merchandiser said that with ethanol margins weakening, some plants are shutting down or reducing run rates. Buyers are looking for product outside their areas because their local plants have no offers. Another merchandiser said there seems to be a rush to secure feed ahead of the upcoming Fourth of July holiday, pushing DDG prices higher this week. Given the weakness in corn and soymeal prices the past few days, it is likely DDG prices during the next few weeks may move lower once the holiday passes or until ethanol margins improve.

INDEX

SECTION 1 REVILLO FARMERS ELEVATOR, INC. ACTIVITIES

SECTION 2 REVILLO FARMERS ELEVATOR, INC. PROFILE

SECTION 3 BUSINESS NEWS ROUND UP

SECTION 1 REVILLO FARMERS ELEVATOR, INC. ACTIVITIES

Revillo Farmers Elevator, Inc. engages in distribution of grains and agricultural products. The company was incorporated in 1938 and is based in Revillo, South Dakota.

SECTION 2 REVILLO FARMERS ELEVATOR, INC. PROFILE

PermID: 5001369945

Website: http://www.revillofarmers.com

Industry: Miscellaneous Commercial Servi

SECTION 3 BUSINESS NEWS ROUND UP

June 23, 2017: Revillo Farmers Elevator, Inc.: Oats Trying to Keep Pace With Spring Wheat

New-crop oat futures have rallied along with spring wheat, both reaching fresh highs on their respective charts in Friday's trade. Since the April 11 low of $5.44 per bushel on the December MGEX spring wheat chart, the new-crop December contract has gained 22%, or $1.20 1/4/bu, to Friday's close of $6.64 1/4/bu. At the same time, December oats have gained 46 1/4 cents, or 21.6%, between the December contract's $2.14 1/4/bu low and Friday's $2.60 1/2/bu close.

The June USDA WASDE report could be viewed as slightly bullish for oats, with the 2016/17 ending stocks estimate trimmed by 4 million bushels since May, which carried through to an equivalent drop in 2017/18 ending stocks to 37 mb, which would be the lowest ending stocks in four years. As a percentage of estimated demand, this would represent 21.3%, down from a recent high of 36% in 2014/15.

Then there is the U.S. crop ratings. The weekly crop condition index (CCI), utilizing DTN's index methodology: (3* % excellent + 2 * % good + 1 * % fair - 1 * % poor - 2* % very poor = CCI) has fallen four consecutive weeks to a CCI of 128 as of June 18, down 30 points from the May 21 high and down sharply from the 169 reported on the same week last year. This is the lowest rating seen for this week since the same week in 2011.

While the U.S. rating is spread across nine states, what does jump out is the impact of the growing drought seen in the Dakotas, with the latest ratings showing North Dakota at 30% good to excellent, or a CCI of 61, while South Dakota is showing a good-to-excellent rating of 33%, or a CCI of just 50. Given this spring's Prospective Planting report, these two states are expected to plant 18% of the country's acres. The largest percentage of acres were expected in Texas, at 17.8% of the total crop seeded, while the good-to-excellent rating was also under pressure at 47%, with a CCI of 112. U.S. acres may be revised in the June 30 report.

June 22, 2017: Revillo Farmers Elevator, Inc.: Firm Fined for Cattle Trades

A trading and investment firm in Memphis, Tennessee, and two of the company's senior leaders have been fined more than $5 million by the Commodity Futures Trading Commission for intentionally trying to avoid contract limits on live cattle contracts in 2012 and 2013.

The CFTC entered into an order and settled charges against McVean Trading & Investments LLC of Memphis; its chairman and CEO, Charles Dow McVean Sr.; and firm president, Michael Wharton, as well as a consultant for the investment firm, Samuel Gilmore.

McVean Trading & Investments issued a statement that the investment firm settled with the CFTC without admitting or denying the commission's findings, "avoiding the need for ongoing discussions and litigation that could have created significant distraction from McVean's primary goal of serving its clients."

McVean also noted that the CFTC order did not allege that the company or executives acted contrary to the interest of McVean's clients or affect the trading company's clients or capital.

The CFTC claimed McVean and its executives used feedyards to try to bypass limits on spot month contracts. They reached a point where McVean executives held as much as 43% of the open interest in the February 2013 live cattle contract. It created a false appearance that there was wider market interest and participation in the contract than actually existed.

According to the CFTC, the executives at McVean sought to increase the company's in-house contracts for live cattle futures at or near the delivery month for the contracts above the legal cap on contracts set by the Chicago Mercantile Exchange.

Charles McVean and Wharton worked with Gilmore to sign agreements with four unnamed cattle feedyards "as straw purchasers" to buy hundreds of long live cattle futures contracts. The four feeders were paid a fee of $100 for every live cattle contract they traded at McVean Trading's request. Because the feedyards' transactions were controlled by the trading firm's executives, the company had effectively concealed its positions in the market and made it appear there was more open interest and participation in the spot month of the contract than actually existed.

McVean executives increased the company's total positions in the market through the feedyards in the December 2012 live cattle contract and the February 2013 contract. In each contract, McVean Trading was "over limit" on contracts by several hundred contracts. In February 2013, for instance, Charles McVean and Wharton each held the limit of 300 contracts, but each also had feedyards with hundreds of contracts as well. The CFTC noted that Charles McVean "controlled as much as 23% of the open interest in the February 2013 live cattle futures contract during the delivery period, approximately four times what his control would have been absent the positions in feedyard accounts."

Further, Wharton controlled as much as 20% of the open interest in February, or roughly double what his control would have been without the feedyard accounts.

The CFTC charged that Charles McVean, Wharton and Gilmore violated the Commodity Exchange Act's prohibition against using a manipulative or deceptive device to unlawfully influence the cattle market. McVean Trading is liable for those violations.

Breaking down the fines in the settlement, Charles McVean agreed to pay $2 million and McVean Trading agreed to pay $1.5 million. Wharton agreed to pay $1 million and Gilmore agreed to pay $500,000.

June 22, 2017: Revillo Farmers Elevator, Inc.: Pest Roundup

With most of the country's corn and soybeans in the ground, insects and diseases are ramping up in their usual summer fashion.

Some Midwest and Mid-South growers are facing rising Japanese beetle populations, and soybean aphid populations also are picking up in the northern Cornbelt. Meanwhile, a brand new corn disease first found in 2016 is already surfacing in Nebraska cornfields and more reports of it are sure to come.

Let's dig in!

BACTERIAL LEAF STREAK

Farmers should get used to hearing this disease's name.

Bacterial leaf streak of corn snuck into the country by unknown means and has been found in nine U.S. states since its official identification last year: Colorado, Illinois, Iowa, Kansas, Minnesota, Nebraska, South Dakota, Oklahoma and Texas. It infects field corn, seed corn, popcorn and sweet corn.

Last week, the disease was again confirmed on V4 field corn plants in Adams County in south-central Nebraska. Likely but unconfirmed reports also are coming in from southwestern Nebraska, Kansas and Colorado, University of Nebraska Extension plant pathologist Tamra Jackson-Ziems told DTN.

As a brand new disease, researchers have little information on yield loss or management, which is frustrating, Jackson-Ziems admitted. Like all bacterial diseases, fungicides won't affect bacterial leaf streak, and it clearly overwinters easily on infected corn residue. New research shows that some grassy plants might also help host it.

Most importantly, there were reports of significant yield loss in certain hybrids last year, and Jackson-Ziems urges growers to scout for it.

"It's important to know if it's out there and how bad it is," she explained. "And if you have yield loss at the end of the season, maybe this could help explain that."

"Look for narrow, brownish-yellow stripes between the veins on the lower leaves," she said. "They can be short or as long as the whole leaf."

These symptoms mimic gray leaf spot symptoms, but that fungal disease has never been found this early in Nebraska, Jackson-Ziems said. Also, the lesion edges of bacterial leaf streak tend to be wavier than those of gray leaf spot, she added.

June 22, 2017: Revillo Farmers Elevator, Inc.: NFU to USDA: Open up CRP

he National Farmers Union and state affiliates in the Northern Plains are calling on Agriculture Secretary Sonny Perdue to allow emergency haying and grazing on Conservation Reserve Program acres.

In a letter to Perdue, National Farmers Union wrote that farmers and ranchers in the upper Great Plains are facing significant drought. Specifically, the state Farmers Union presidents of Minnesota, Montana, North Dakota and South Dakota joined NFU President Roger Johnson in signing the letter.

"Reports from our members have painted an alarming picture of deteriorating feed supply," the letter stated. "While recent rainfall has helped, it has done little to significantly alter conditions in the long term."

The threshold under the Drought Monitor Index has not been released for allowing haying and grazing on CRP, but the NFU letter stated that hay is in short supply right now. "Many producers are left with the difficult choice of downsizing their herd or driving hundreds of miles to purchase hay."

Typically, USDA approves emergency haying or grazing of CRP acres when an emergency authorization is approved by the national Farm Service Agency office or by the state FSA committee using the Drought Monitor.

NFU asked Perdue to approve the emergency grazing as soon as possible. Waiting until August would leave the grass with a lot less nutrient value, the group stated.

If approved, landowners who request emergency haying or grazing are assessed a 10% payment reduction.

June 21, 2017: Revillo Farmers Elevator, Inc.: Dicamba Drama

Dicamba herbicide could have its own mini-series in the state of Arkansas. The question of whether to ban in-crop use of dicamba for the remainder of the growing season will be back on the table in the state on June 23 because of a voting discrepancy.

Tuesday, June 20, it initially appeared Arkansas State Plant Board (ASPB) did not have enough votes to carry the measure, despite eight members voting for the dicamba ban and six against the proposal. It was assumed nine yes votes were needed for passage since there are 16 voting board members on the 18-member board.

As an alternative measure, the group then decided to recommend tacking additional application restrictions on Engenia, the only dicamba product that can be legally sprayed over the top of soybeans and cotton in Arkansas. The ASPB voted 11 to 3 to require applicators to use hooded broadcast sprayers when spraying Engenia and increased the downwind buffer to 1 mile (originally 0.25 mile).

PermID: 5001369945

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