March 08 2024

Weekly AgTwitter Recap (WATR)

An Unfortunate Trifecta: Super Tues, SOTU, & the H WASDE

Live & Feeders are back at the highs: a quick lap around the world of beef.

Brazil is really big and getting bigger, there is a reason we eat cows, and ranchers are pissed after reports of lobbyists acting against their best interests.

Let’s hear from the other meats… And we get a body odor theme.

Divisiveness is not good for American Agriculture. Full Stop

Let’s get behind Robby and Oliver on things Americans can come together on.

This political season is going to get toxic. Before everyone starts hurling insults, let’s take a step back and remember that there are no good options from the other side’s perspective.

More importantly, the SOTU was not a friendly speech, and the response will also be unfriendly. Each week, the country gets a little more polarized. This is not good for America, the world, or American agriculture.

So, however you feel, remember that if one side loses, there is a good chance both sides will lose in the long run.

The Call of the Week: US Soybean Oil Exports!

Less than three years ago, the rush to expand crush capacity at all costs was on. I had a financier call to ask if a soy processing facility could be built in a state and not impact basis. When I asked for specs on the plant and the location, it took five minutes to realize that the plant would absorb more soybeans than available.

Another critical factor was that this state directly fed an export market. The impact would be twofold. First, the existing trade flows would need to be reoriented. Second, the basis would certainly be impacted, and margins would fall over time.

Since then, three critical developments:

1) Brazil’s crush footprint expanded massively, and Argentina could reemerge as a processing powerhouse.

2) The US allowed the import of most low CI feedstock to displace soybean oil.

3) Working capital is no longer free. It is expensive to carry large, forward hedge positions.

Just consider these trends continuing at their current pace for the next 12-18 months. The USA may need the export market or margins will do the unthinkable... slow US crush rates 😱 😱 😱

Speaking of accurate forecasts…

The March WASDE Folks!

This is true Rory, but alas, here we all are.

It could be worse, you could be on Farm Journal’s mailing list

This is cool, but struggling to remember the last time I visited the Shambhu border.

A quick tour around #AgTwitter

➡️ He Identifies as a 🐠 🐟 🎣

The #AgTwitter I can’t unsee

Who you got? Norm or GFY (which might be an algo here, but also could be just a person’s opinion) 🤷🤷🤷

What the X???

Let us provide some background. The direction X is heading is a full-service platform with its own payments, end-all-be-all for your eyeballs, and spending (think all advertising revenue in one place).

Why get rid of the number of likes, reposts, etc?

The psychology term is intermittent variable reinforcement. Social media algorithms target your response to dopamine and stimulus. But uncertainty elicits the greatest response. If we receive a prize every time we accomplish a task, we can control how we approach the task. The unpredictability of accomplishing those same tasks leads to compulsion. Compulsion will keep you on X longer and longer, concentrating your time, spending, content creation, etc. in one place. Just like below, the offerings will only increase.

This is not new to social media, it began with the Facebook News Feed in 2007. IT IS NEW TO AGRICULTURE.