Posted by: usset001 | June 2, 2009

My Fox News moment (and one I doubt will ever see the airwaves)

Last week as I was hidden away deep in the BWCAW – out of cell phone range – I built up a cache of phone messages. Several people from the University were trying to tell me that Fox News was coming to town early next week. Ruth Ravve, a Fox News reporter, wanted to record an interview with me about the current grain markets.

This particular Fox News group hails from  Chicago and made their way to Minnesota to cover the court proceedings of the Franken/Coleman battle. The interview with me was a secondary purpose. Yesterday morning, a University media relations person contacted me to set an interview time of 10:00 am this morning. Later in the afternoon they called again to cancel the interview. Later still, the Fox News reporter called me directly to reschedule the 10:00 am shoot. I convinced her that we should do it at the now empty floor of the Minneapolis Grain Exchange, just two blocks from where she and her film crew were staying.

Reporters are always looking for the angle that connects with the average viewer. The subject was corn and soybean prices, which have been trending higher for several months now. Was this trend caused by planting delays in the Eastern Corn belt and the Red River Valley of the North? Should consumers be wary of higher food prices in the months ahead?

I doubt if my answers warrant air time. Yes, the Illinois and Indiana corn crops are late getting into the ground. But the latest crop conditions report indicated that farmers in both states got another 20% of their corn planted in the last week of May – both stand at about 80% planted vs. a five year average of 95-98%. Late? Yes. Panic time? Hardly. It is early June and I suspect the next report will have these states nearly caught up.

Higher food prices? Hog prices are in the tank. Last week in Northern Minnesota, I bought four large stuffed pork chops to feed four large hungry men for a total cost of about $6. The dairy industry is reeling. Convenience stores in my area are offering milk at the low price of two gallons for $5. The poultry industry is suffering and retail prices reflect the pain. For the economy in general, long-term inflation concerns are real. But I struggle making the case today.

Changes in S&P 500 index and corn futures (December contracts)

Percentage changes in S&P 500 Index (red) and corn futures (green), December contracts

Since bottoming in early December, corn and soybean prices are much higher. Soybean prices have reason to trade higher. In the past six months we’ve learned that U.S. acres will be cut, the soybean crop in Argentina is smaller, the dollar remains weak and exports to China are two thumbs-up. Corn prices are also higher, riding the back of an idling (out-of-gas?) ethanol industry and limping livestock and dairy industries. I think the accompanying chart says it all. Right or wrong, corn prices (and commodity prices in general) are tracking with markets thoughts about the economy, as reflected in stock prices.

As we were wrapping-up the shoot, Ruth’s Blackberry rang with an important message from the Fox News center in Chicago. Governor Pawlenty was calling a news conference to discuss his future in politics! Get to the Capitol ASAP to cover the news conference!

I owe the Governor.

 


Responses

  1. Ed, You should have told her higher food prices are a left wing conspiracy. You would have been the lead story.


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