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22. November 2004 ***The American Soybean Association Weekly Update Will Not Be Published November 29 In Honor Of The U.S. Thanksgiving Holiday*** New Cases Of Rust In Southeast U.S.; States Will Conduct Own Crop Surveys USDA announced November 19 that it has confirmed the first finding of the Asian soybean rust fungus in Alabama. USDA’s Animal and Plant Health Inspection Service, or APHIS, made the announcement on its Web site shortly after the Georgia Department of Agriculture announced its state’s first finding of the fungus. APHIS also said November 19 that the fungus has been found for a second time in Florida, although in this instance it was discovered on a kudzu plant. Kudzu is a plant that "can serve as a ‘host’ for the fungus that causes the disease," APHIS said. "The number of confirmed soybean rust cases in the southeast United States now stands at ten," APHIS said. Alabama is the fifth U.S. state to find the Asian rust fungus in a soybean field since Nov. 10. USDA has also confirmed cases in Mississippi, Florida and Georgia as well as Louisiana. Meanwhile, USDA disbanded the federal assessment team sent down to Louisiana and Mississippi last week to examine Asian rust. The team is not expected to be reformed, leaving further follow-up to individual states, USDA spokesmen Jim Rogers said. "The states will do their own surveys, send us samples — we’ll test those samples — and then we’ll let the states know whether the samples are soybean rust or not," Rogers said. APHIS officials are now debating the best way to pull together a comprehensive survey on Gulf Coast states that are seen as the most susceptible now to Asian rust. USDA said surveys will be primarily focused on areas affected by hurricanes this year because USDA still believes Asian rust blew into the U.S. from South America, where is has plagued Brazilian farmers. Rust Found On Crops In Brazil’s Parana State Brazilian officials received the first report of the deadly Asian rust fungus at a commercial soybean plantation this season, government researchers said November 19. The disease was identified in Tres Barras do Parana, southwestern Parana state, in crops entering the flowering phase, said Claudia Godoy of the anti-rust team at Embrapa, the government crop research bureau. Godoy said there was a good chance of heavy rust attacks this year, should wet weather conditions persist. Farmers must monitor their crop closely and spray herbicide when they see or hear of rust close by, she added. Rust had already been identified in five soybean-producing states, Mato Grosso, Parana, Rio Grande do Sul, Goias and Maranhao, but up until November 19 it was only found in experimental crops or in seeds that germinated from soybeans left from last year’s crop. Possible Case Of BSE In U.S. Could Lead To Full Ban On Meat And Bone Meal The possible discovery of a second case of BSE in U.S. could give a boost to soybeans. The U.S. Department of Agriculture said Thursday morning that a test was being conducted for a second possible case of BSE in the U.S. Officials said it would be four to seven days before conclusive test results would be available. The origin of the suspected case wasn’t disclosed. The announcement was regarded as slightly bullish for soybeans prices. Analysts speculated about rumors USDA would ban meat and bone meal. A ban on the feeding of meat and bone meal to ruminant animals like cattle and goats is already on the books in order to halt the possible spread of BSE in the U.S. If an industry-wide ban on the protein supplement were implemented for even hogs and chickens in the future, larger demand would spill over to soymeal to pick up the slack as a source of protein for livestock. Soybean Barge Movements Strong The movement of soybeans by barge through the key locks and dams on the Mississippi River System was as strong as they have ever been for the week that ended November 20. Based on daily movements, soybean volumes for last week are projected to total 465,000 tonnes, nearly 50% greater than the previous week and not quite double the average volumes for this week. Compared to the same week last year, soybean movements are running 146% greater. The projected volume of soybeans would be a record for this week but compared to others of the year, they would be about 300,000 tonnes below the historical high volume moved during October of 1997. Cumulative soybean movements since September 1 are lagging last year’s volumes nearly 20%, while trailing volumes of the past 5-years nearly 32%. Since September 1, soybean movements by barge through the key locks have totaled 1.829 million tonnes. Lack Of Investment In Infrastructure Plagues Brazil Brazil’s investment in infrastructure to move its soybean crop has been inadequate. As a result, Brazil’s transport costs already double those of its main competitor, the U.S. Brazil’s federal government has failed to invest in basic road maintenance and did not pass legislation necessary to allow numerous private and international projects to go ahead. Only one in four federal highways is in good condition, according to a recent survey by the National Transport Confederation. And, a lack of capital has restricted investment in major railway projects. The ports fare little better with operations nearing capacity, which result in waiting times of over a month during high season. The true cost of creating a decent transport and stocking system is over 10 billion reals per year, according to government estimates. A price it readily admits it can’t pay. Soy Complex Mostly Higher On BSE News The soy complex closed mostly higher on November 18. News that another U.S. cow is being tested for BSE after an initial test was inconclusive triggered a limit-down move in cattle on the opening but meal was strong and moved to the highest level since October 11 for the January contract on ideas that there could be further restrictions on meat and bone meal feeding. In addition, broiler production in the U.S. continues to expand at a 3-4% clip, which should keep domestic meal demand strong. January bean futures closed up $0.73 finishing at $203.93; March was $0.64 higher, closing at $205.67 and May gained $1.01 ending at $208.24. December meal was up $2.54, closing at $176.48; January was $2.31 higher, finishing at $178.13 and March increased $1.65 to finish at $180.67. December oil closed $3.75 lower to finish at $472.67; January decreased $3.75, closing at $475.31; and March lost $2.87, ending at $478.18.
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