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U.S. Government Shuts Down in Budget Impasse While Farm Bill Expires

U.S. Government Shuts Down in Budget Impasse While Farm Bill Expires

Political Turmoil in Washington Leaves American Farmers without a Farm Bill

By Amanda Brodhagen, Farms.com

On Tuesday, for the first time in nearly two decades the U.S. federal government has plunged into a partial government shutdown. Congress gridlocked on U.S. President Barack Obama’s health care policy, which stalled a temporary funding bill, forcing about 800,000 federal employees off the job.

Congress failed to evade the first partial government shutdown in 17 years. The last shut down occurred under President Bill Clinton from Dec. 5, 1995 to Jan 6. 1996. The partial shutdown forces national parks and museums to closed, as well as and most government departments. Essential services including Border Patrol agents and most food inspectors will continue to work.

It is unclear how long before the impasse will be broken. The situation is in a state of influx. Republicans stand firm that they were elected to dismantle ‘Obamacare’. On the other hand, Democrats want to continue to go full steam ahead on rolling out Obama’s health care law. Some experts say that the Republicans stand to lose the most in this political upheaval, just as they did during the last partial government shutdown in 1995 to 1996.

Farm Bill Woes Continue…

The U.S. Department of Agriculture was hit with a double whammy; it had to shut down its services today because of the federal government budget impasse and the Farm Bill expired. Congress has struggled to replace the 2008 extension of the legislation, which expired Sept. 30. Permanent law of the 1950s farm measure is now in effect.

The farm bill expired again, despite the Senate passing its farm bill in June and the House passing its version mid-July without a nutrition title. At the time, the Senate appointed conferees which would reconcile both versions of the bill, while House leaders said they wanted to pass the nutrition portion of the bill before appointing conferees. The House did end up passing the nutrition portion late September, which cut $40 billion over ten years from Supplemental Nutrition Assistance Program, better known as food stamps. Two days before the farm bill was set to expire, the House added the nutrition title with the farm provisions.

The government shutdown stalls progress on reaching a new Farm Bill deal. Farmers are yet again left in limbo, awaiting action on a new permanent law, while farm lobby groups continue to push to get a conference. The American Soybean Association lobby released a statement addressed to Congress.  “It’s time for our elected officials to remember who they represent and get to work passing a farm bill that works for American farmers,” said ASA President Danny Murphy. Farmers expect Congress to work out their differences and deliver a new farm bill.
 


Trending Video

Will the 2025 USDA December Crop Report Be a Market Mover/Surprise?

Video: Will the 2025 USDA December Crop Report Be a Market Mover/Surprise?


Historically, the USDA December crop report is a non-event or another dud report as the USDA reserves any final supply changes to the final report in January of the following year in this case 2026. But after the longest U.S. government shutdown in history at 43 days and no October crop report will they provide more data/surprise and make an exception?
Our China U.S. soybean purchase tracker is now at 26.6% or a total of 3.2 mmt but for traders it’s taking too long to unfold.
The final Stats Canada production report was bearish canola and wheat projection a record crop in both (it adds to the global glut of supplies) and bullish local corn and soybean prices in Ontario/Quebec thanks to a drought. It will not help the fund flow short-term, the USDA may need to offset it?
A U.S. Fed interest rate cut of another 25-basis point next Wednesday (probability 87.1%) could help fund flow and sentiment in stock and ag commodities into year end.
More inflows into Bitcoin this past week saw prices rebound back above 90,000 with support at 82,000 and resistance at 96,000.
A V-shaped bottom in cattle suggest the lows are in after Mexico reported another new world screwworm case. Lower weights, seasonal demand and higher U.S. beef select/choice values with a continued closure of the Mexican border to cattle will result in a resumption of higher cattle futures into yearend.
Australia is expected to produce its 3rd largest wheat crop ever at 36 mmt adding to the global glut of supplies.
Reports of ASF in hogs in Spain the largest pork exporter in Europe could see the U.S. win more pork export business long-term.
If the rains verify into next week of 3-5 inches for Brazil it would go a long way to fixing the dry regions from the last 2-months, but the European weather model has been wrong for the past 2-months!
Natural gas futures are surging to the 3rd price count as frigid hold temps set in.
CDN $ is also surging to end the week on a very resilient economy and better employment numbers suggesting no interest rate cuts next week.
Finally, the CFTC report showed funds were net buyers of soybeans but sellers of corn, canola and wheat. In real time the funds have gone back to selling as they take some profits.