AgriSuccess Express
Check out this week's news

December 1, 2006

3.	Progress on moving older cattle south

4.	Canada gets temporary stay from inspection fees

5.	Western Grains Research Foundation explores new check-off options

6.	Potato growers challenge law

7.	Phytosanitary program for nurseries

8.	CFIA proposes compensation changes

9.	National vet pool ready for animal emergencies

10.	CWB announces interim payments

11.	Big demand for organic milk in Quebec

12.	Market Focus – Forward contracting 2007 wheat

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1. ADM expands oilseed crushing

Archer Daniels Midland is increasing its North American oilseed crushing capacity through expansion of oilseed crushing plants in the U.S. and Canada.

Five soybean crushing plants will be expanded in Quincy, Ill.; Frankfort, Ind.; Mexico, Mo.; Freemont, Neb.; and Des Moines, Iowa. Two canola crushing plants, one in Velva, N.D., and the other in Lloydminster, Alta., will also be expanded. The plant in Velva buys a substantial amount of its canola from producers in Western Canada.

ADM says the expansions will support the company's two North American biodiesel facilities located in Mexico, Mo., and Velva.

ADM says the factors driving the increased demand for oilseed crushing include a growing population which increases the demand for food worldwide, rising global wealth which is changing protein and oil consumption, and increasing global energy needs and energy security concerns that promote biodiesel demand.

The expansions are scheduled for completion in mid-2008. However, construction on the expansions is dependent on final engineering and permit approval.

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The fall calf run in the Prairie region has been characterized by dropping prices. During the week of Nov. 20 to 24, the long slide in feeder cattle prices finally came to a halt.

Beef economist Sandy Russell of Saskatchewan Agriculture and Food reports that price averages were higher on all classes of feeder cattle sold in the province. The biggest price increases came on 400 to 600 pound steers, which were up $8 to $9 a hundredweight. Light heifers were also up, but only by $2 to $4 per hundredweight.

Feeder cattle prices are still substantially below the levels of a year ago, and that has dramatically cut the profitability of cow-calf producers.

One of the main reasons is the rapidly increasing price of feed barley. With feed costs escalating, feedlots, most of which are located in Alberta, cannot afford to pay as much for feeders.

Russell says an improvement in fed cattle prices is now enabling feedlots to up their prices. In Saskatchewan, fed steers were up an average of $2.50, with heifers up a dollar. In Alberta, fed steers averaged $3.50 higher with heifers up by more than $3. Another factor helping feeder prices is year-end tax dollars being invested in the marketplace.

Russell says there's a significant supply of bred cows and bred heifers on the market and those prices are expected to continue experiencing pressure.

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Copyright 2006, Farm Credit Canada

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