Sun, Jan 27, 2019 - Page 14 News List

GMO soy seeds lose luster as US farmers hunt profits; Ghana to rescue cocoa board


For the first time in 15 years, Illinois farmer Steve Ruh would plant only old-school soybean seeds to boost profit in a premium niche market, abandoning the popular genetically modified varieties.

“Margins are so tight you are looking for anything you can to generate more dollars per acre,” Ruh, 50, said in a telephone interview from Sugar Grove, Illinois.

Soybean futures in Chicago have slumped as much as 25 percent from a peak in March last year as China, embroiled in a trade dispute with the US, opted for Brazilian supplies following bumper crops in the Americas.

Ruh is to seed his 607 hectares in April, joining US growers seeking options in a premium market to boost slumping earnings and cut costs from pricier modified seed varieties.

Last year, US farmers likely endured the fourth drop in net income in five years, while costs climbed 4.2 percent, government data showed.

The median price of a bag of soybean seeds with no genetic modification is US$39, compared with the priciest GMO variety at US$54, Kevin McNew, the chief economist at Farmers Business Network, said in a telephone interview, citing his firm’s study.

Clarkson Grain Co has offered premiums to farmers as high as US$2.50 a bushel over futures for certain non-GMO soybeans in the coming year.

The interest from growers is increasing, Ashley Brown, a merchandiser at the Illinois-based company, said in a telephone interview.

Ghana is in talks with lenders for US$300 million in loans to support the country’s loss-making cocoa regulator.

Ghana Cocoa Board, which oversees sales and purchases in the world’s second-biggest grower of the chocolate ingredient, needs 1.1 billion cedis (US$223 million) to meet its commitments for the annual season through September, according to a document that was submitted to lawmakers on Dec. 22 last year.

The proceeds of the loan would be used to refinance 1.4 billion cedis in so-called cocoa bills that were sold in the previous season, some at rates of as much as 18.3 percent, according to the document.

The board is in talks with a syndicate of lenders including Cooperative Rabobank UA and Societe Generale SA to borrow the money at 295 basis points over Libor.

The regulator is struggling to cover its expenses after keeping farmers’ minimum pay unchanged for three seasons straight, even though prices have declined from highs that were reached in the middle of 2016.

While cocoa rebounded last year, forecasts of bumper crops from West Africa’s biggest growers have again weighed on prices since the beginning of the year.

Precious metals:

‧ Spot gold on Friday rose about 1.5 percent to US$1,305 an ounce, up 1.7 percent for the week.

‧ Spot silver on Friday climbed to US$15.77 per ounce, up 2.3 percent for the week.

Additional reporting by staff writer

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