Russia To Test Next-Generation Stealth Bomber Next Month 

As Cold War 2.0 looms between Russia and the US, Moscow upped the ante last week with the announcement of a new next-generation stealth strategic bomber.

TASS News reports the Tupolev PAK DA bomber is being developed for Russia’s Aerospace Force will undergo trials at the Flight Test and Development Center in the city of Zhukovsky outside Moscow next month.

“There are big plans ahead for testing and further developing the heavily upgraded Tu-22M3M, Tu-160 and Tu-95MS aircraft along with large-scale work for testing the prospective complex of long-range aviation [PAK DA],” Tupolev CEO Alexander Konyukhov said during a meeting at the 70th anniversary of the Zhukovsky Test Flight and Development Center.

Head of the Defense and Security Committee in the upper house of Russia’s parliament Viktor Bondarev said the PAK DA stealth bomber is expected to replace Tu-22M3, Tu-95MS, and Tu-160 bombers.

Procurement of the new planes to Russia’s Aerospace Force is expected to start in 2025 through 2030. There is no word on if the bombers will carry hypersonic weapons.

Russia’s announcement of a new stealth bomber comes as new reports from Western media indicate the US Air Force’s next-generation stealth bomber could be operational in the mid-2020s and could fly as early as 2021.

Computed generated images of the Tupolev PAK DA recently surfaced on YouTube account Military Update, shows several minutes of the aircraft’s design.

There are limited details on the test next month at Zhukovsky. Government and Tupolev officials didn’t say if an actual airframe is being tested. Carefully worded statements from the company say the development work is nearing completion and deliveries are expected by 2025.

An earlier announcement said flight tests were expected in 2019.

Konyukhov also the Zhukovsky flight center will be used for development on the medium-haul military transport plane, and also a supersonic passenger jet “jointly with the leading sectoral research institutes and enterprises.”

On Saturday, we reported that the Sukhoi Aircraft Company, part of Russia’s United Aircraft Corporation, has started series production of Su-57 fifth-generation fighter jets and will soon be delivering these planes to the country’s Aerospace Force.

Deputy Prime Minister Yuri Borisov, told TASS last week that production of the stealth jets has started, with expected production ramps through the 2020s.

“A state contract was signed at the Army 2019 international arms exhibition between the Defense Ministry of Russia and the Sukhoi Company for the delivery of a batch of Su-57 fifth-generation fighter jets. The Sukhoi has started to fulfill its contractual obligations,” the vice-premier’s office reported.

The state contract requests the delivery of 76 Su-57s to Russia’s Aerospace Force by 2028.

Russia’s procurement plans of stealth bombers and current acquisitions of stealth fighter jets reflect the military’s modernization effort.

Russia, along with China, is in great power competition with the US. In securing its domestic and foreign interests, Moscow has moved swiftly to overhaul its military capabilities by replacing out-of-date Soviet-era weapons with next-generation weapons. Low oil spot prices and economic sanctions from Washington, however, are impeding President Putin’s task of bringing new weapon systems online on quick notice.

Could The US Be Gearing Up For A Return To The Gold Standard?

Authored by Alex Deluce via,

There may be readers who weren’t even born when the U.S. still had a gold-backed dollar. Since the gold standard was abolished in 1971, the value of the dollar has decreased annually by 3.96 percent. You would need over $600 today to purchase the same goods you purchased for $100 in 1973. Still, a dollar is a dollar, right? No, it is not. It is just a piece of paper.

Is there a chance the U.S. could return to the gold standard and provide real value to the U.S. currency? Judy Shelton and Christopher Waller are President Trump’s pick for Federal Reserve governors. As it happens, Ms. Shelton is a believer in the gold standard and a critic of current Federal Reserve policies. She believes that the Fed has become unnecessarily involved in trade policies instead of adhering to its function of regulating the monetary system. Returning to the gold standard is not a popular idea these days when economists support the limitless printing for currency, high debt, and inflation. 

Ms. Shelton would have been considered mainstream 35 years ago. Today, she is thought of as unorthodox. In 2018, she wrote in an article published by the conservative thinktank, Cato Institute,

If the appeal of cryptocurrencies is their capacity to provide a common currency, and to maintain a uniform value for every issued unit, we need only consult historical experience to ascertain that these same qualities were achieved through the classical international gold standard.”  

She also authored a book, Fixing the Dollar Now. In it, she advocates for linking the dollar to a benchmark of value, preferably gold. More than four decades ago, the currency of all major countries, such a Britain, Japan, France, Russia, and others were linked to gold. In 1933, the dollar was linked to $35 worth of gold. In 2019, the value of the dollar is less than one-thirtieth of that. 

The gold standard helped the U.S. prosper for 180 years. The signers of the U.S. Constitution included this requirement in Article 10.

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

Almost two hundred years later, such a concept is deemed unorthodox. Ideologies change, and not always for the better. 

The reason the Founding Fathers included a monetary policy in the Constitution is that they wanted money to be as far away as possible from any human intervention. This was achieved by linking the dollar to gold. Gold is a stable commodity, and thus ensures a stable U.S. currency.

Countries today link their currency to some other, stronger currency, such as the dollar or the euro. This means that these countries have no control over their own currency and are at the mercy of an arbitrary link. But as the dollar and euro weaken, so do the currencies that have linked themselves to it. This serves as a disruption of all global economies.

“Stable money” provides us with logical economic guidelines. Market forces become the determining factor of what is produced and where capital is spent. For example, if the price of oil becomes too high, the consumer will reduce oil consumption while companies will either increase their production of oil or seek other sources. When market forces rule, everyone benefits. 

Market forces have largely been replaced by government interference and manipulation. The cost of a loaf of bread is what the government says it will be. (See Venezuela for an extreme example.) To manipulate prices, the government, or the Fed, needs to manipulate the value of the dollar. The loaf of bread purchased a year ago for $2.00 now costs $2.50. Same bread, manipulated price. When market forces rule, the price of a loaf of bread would be determined by consumer choice. Under central banking rules, the price would be manipulated by some artificial whim.

One of the easiest ways to manipulate money is through easy credit. Print unlimited currency with no intrinsic value and you create a mountain of debt. This will inevitably lead to inflation and higher prices. If the dollar were once again linked to gold, only a certain amount of money, backed by gold, could be printed. Debt, inflation and higher prices would almost immediately go into a tailspin. Money cannot be manipulated under the gold standard. Perhaps that is why so many economists fear to return to such a standard.

Judy Shelton will be duly criticized for her opinions. Stable money is a new concept for a new generation of bankers and economists. But gold has been around for thousands of years and will undoubtedly outlast these new thinkers.

With Hong Kong Crippled By Mass Stirke, Lam Says She Won’t Resign, Condemns Protesters For Creating “Very Dangerous Situation”

While the world is transfixed by the fireworks unleashed by the plunge in China’s yen to a record low, the real geopolitical hotspot for China remains Hong Kong, and there things are getting progressively uglier following Monday morning’s press conference by Karrie Lam who once again said she will not resign, and warned that “some people” have put Hong Kong in a very dangerous situation as protesters’ actions challenge the “one country, two systems” model and threaten prosperity by seeking to ruin the city by calling for “revolution” or the “liberation of Hong Kong.”

In a press conference in which Lam was flanked by eight top officials, including chief secretary, chiefs of finance, commerce, transport, security, health and civil service as well as home affairs undersecretary, she said she is taking responsibility by staying on to serve, arguing that resignations by her or others won’t help (several million protesters would beg to differ). Her solution: “Upholding the rule of law is the way out”, by which she means the people conceding to Beijing’s demands.

“Such extensive disruptions in the name of certain demands or uncooperative movement have seriously undermined Hong Kong’s law and order, pushing our city, the city we all love and many of us helped to build, to the verge of a very dangerous situation,” Carrie Lam says.

“The government will be resolute in maintaining law and order of Hong Kong and restoring confidence” she said, adding that “we all love Hong Kong and have made various contributions to its stability and prosperity … it’s time to say no to chaos and violence.”

The only problem is that the only ones who are eager to say “no to chaos and violence” are various Triad-linked thugs, and of course, the Chinese People’s Liberation Army, which according to report is massing on the Hong Kong border, just waiting for the green light to, well, “liberate.”

Additionally, Lam said that protests have already deviated from the original demand, Lam said. She didn’t say much on calls for an independent inquiry into police action and recent events. The General Chamber of Commerce has joined protesters in calling for an inquiry.

In a surprising reversal from prior periods when China would sternly ignore the events in Hong Kong, today even the People’s Daily tweeted account has been following every twist in the much anticipated Lam presser, quoting her verbatim as mainland China’s attention is now squarely focused on how Beijing will quell the Hong Kong rebellion.

Meanwhile, financial Secretary Paul Chan warned Hong Kong risks a recession on protests and outside factors like trade.

He may be on to something: on Monday, a paralysing citywide strike as part of the escalating anti-government protests forced Hong Kong airport authorities to cancel some 230 flights on Monday morning. Air traffic controllers have called in sick en masse, echoing the actions of an estimated 500,000 Hongkongers from more than 20 business sectors.

The number of flights that can take off, or land, has been affected as a result, and authorities said only one of the two runways would be in operation from midday on Monday until 6am on Tuesday. Only 34 flights would be permitted per hour during that, instead of up to the 68 per hour that normally take off from the city’s international airport, according to SCMP, with flights across Asia bearing the brunt of the cancellations.

Trains and planes are also being disrupted, with multiple subway lines suspended or delayed and hundreds of flights canceled. 

Finally, as Bloomberg notes, Hong Kong Police will start holding daily press briefings from today and there will be a cross-departmental briefing by the government.

Of course, after weeks of protests and with today’s crippling strike, the last thing Hong Kong stock investors needed was for the yuan to break 7 per dollar on Monday, however that’s what they got, and between the trade and now currency war, and the ongoing tensions in Hong Kong, as well as the paralyzing strike, the pace of equity losses accelerated ahead of the midday break, with the MSCI Hong Kong Index tumbling 3.3% and the bottom is not yet in sight.

But all that pales in comparison to the USD-pegged HG dollar, which in sympathy with the offshore yuan has tumbled, sliding as much as 0.11% to 7.8354 Monday, its lowest since June 12. Will it plunge further and validate Kyle Bass’s thesis of massive capital outflows and a banking sector crisis, it remains to be seen.


Russian Assets In America: A Field Guide

While the media likes to make a fuss about shady ‘Russian hackers’ and ‘Russian bots’ subverting democracy, did you know that America is actually full of Russian assets plying their trade openly? RT exposes the worst of the worst…

If the mainstream media is to be believed, the Kremlin’s network of hackers and bots could give the Illuminati a run for its money. When its operatives aren’t electing British prime ministers, embarrassing American politicians on debate night and flogging dildos to undermine democracy, they’re overseeing a team of assets earning their borscht openly in the United States.

Thankfully, the intrepid detectives in the American press have named and shamed these double agents. We’ve compiled a list here.

Mitch McConnell, alias: Moscow Mitch McTreason

An Internet meme of Senate Majority Leader Mitch McConnell that has been widely shared online.

Cleverly posing as a Republican Senator from Kentucky since 1985, Mitch McConnell was outed as a Russian asset by the Washington Post last week when he shot down a trio of bills that would have supposedly beefed up American election security from foreign interference. 

Never mind that McConnell opposed the bills based almost entirely on partisan disagreements with the Democrats, the Post exclaimed “Mitch McConnell is a Russian asset,” and MSNBC’s Joe Scarborough dubbed the southern Republican “Moscow Mitch.” 

With his nefarious plan exposed, #MoscowMitchMcTreason had no choice but to shrug, and continue about his day.

Asset Rank: 3/10, far too easily exposed

*  *  *

Lindsey Graham, alias: Leningrad Lindsey

An Internet meme shows US Senator Lindsey Graham photoshopped into an image of the Russian honor guard. © Twitter / @HotPockets4All / Matt Johnson

#LeningradLindsey began trending after the South Carolina lawmaker helped push a controversial asylum bill through the Senate Judiciary Committee on Thursday. Though the bill had nothing to do with Russia, the nickname stuck.

Cleverly, Leningrad Lindsey has spent his career on Capitol Hill posing as a Russia-baiter. Graham has repeatedly called for Russia to “pay a price” for allegedly meddling in the 2016 presidential election, and co-sponsored an anti-Russia “sanctions bill from hell.” With a record like that, nobody would suspect that he was secretly a Russian asset all along.

Note too that Leningrad does not exist any more. Perhaps Graham’s treachery dates back to the communist era? Either that or Letnerechenskiy Lindsey didn’t have the same ring to it.

Asset rating: 10/10, excellent cover

*  *  *

Donald Trump

FILE PHOTO: Donald Trump and Vladimir Putin meet in Helsinki © Reuters / Leonhard Foeger

There is absolutely zero need to spell out the case against President Donald Trump. He’s clearly a Russian asset, and has been since Soviet times. He rigged the 2016 election, paid Russian hackers to give Hillary Clinton’s emails to WikiLeaks, had Russian dressing on his salad that one time, and remains in constant telepathic contact with Vladimir Putin.

However, were it not for the brave detective work of CNN, MSNBC, Buzzfeed, Hollywood actresses and late night comedians, Trump might just have gotten away with it. The collusion was so well hidden that not even an FBI probe and a two-year-long investigation by Special Counsel Robert Mueller could find a trace of it.

Asset rating: Yuge, the biggest

*  *  *

Hamburgers, aka: Stalin’s Sandwiches

A McDonald’s restaurant in Russia © Flickr / Sandra Cohen-Rose and Colin Rose

Ahh hamburgers, the cornerstone of the American diet. President Trump is known for his fondness for the handheld calorie-bombs, which set alarm bells ringing at Washington Post headquarters.

Lo and behold, the Post found out that “even one of Trump’s favorite foods has a hidden Russia connection.” The storygoes that then-Soviet food minister Anastas Mikoyan visited the US in 1936 and brought home some hamburger-making machines. The Russians took to the American staple with glee, and after putting a few of their own twists on them, renamed them “Mikoyan cutlets.”

Though the Post didn’t elaborate any further, the Russian plot is visible if you read between the lines. In his infinite duplicitousness, Vladimir Putin clearly funds the American hamburger industry in a bid to fatten and weaken the American people. If two years of Russophobic coverage have taught us anything, it’s that no story is too far-fetched to be true.

Asset rating: $2.99, would you like fries with that?

*  *  *

The Washington Post, aka: The Moscow Meddler

FILE PHOTO: Washington Post owner Jeff Bezos © Reuters / Joshua Roberts

There is precisely zero evidence to suggest that the Washington Post is a Russian asset. However, that evidentiary standard hasn’t stopped the Post from labeling Trump, McConnell and Ronald McDonald as Russian agents. 

Based on that logic, we have no reason to disbelieve Donald Trump’s assertion this week that the Capitol’s paper of record is in fact an asset of the Kremlin.

Asked by reporters on Tuesday to respond to the Post’s ‘Moscow Mitch’ story, President Trump said, “The Washington Post called Mitch McConnell what? I think the Washington Post is a Russian asset by comparison.”

Asset rating: 10/10, на здоровье Comrade Bezos

*  *  *

We hope this guide has laid bare the extent of the Russian operation in America. However, we fear that the stooges exposed here are only the tip of the iceberg. Join us next week when we take a closer look at Barney the Dinosaur, Beyoncé, and Mister Snuffleupagus, all of whom are suspected Russian assets too.

A Prepper’s Advice: How To Survive A Mass Shooting

Authored by Daisy Luther via The Organic Prepper blog,

Mass shootings are happening more and more often in America. Yesterday, there were two mass shootings within 24 hours that claimed the lives of 29 people and injured 52 more. A mass shooting in a Texas Wal-Mart took the lives of 20 people, and a shooting in a popular nightlife area in Dayton, Ohio killed 9 more. Being caught up as a victim in something like this is a hellish nightmare you wouldn’t wish on your worst enemy.

A synopsis of the event came from a Facebook live video. (Is it just me or do you find it strange that someone was recording a video and not running like hell?)

At the start of the video, a woman runs toward the store, past a truck that a shopping cart has run into, with a body lying on the ground beside it. 

Children were holding a fundraiser at the store and some reportedly were among the casualties.

At the front of the store, victims’ bodies are shown near a table that appeared to have items for sale. The body of a man in blue jeans and a blue shirt is seen on the ground near the table, lying on his stomach, seemingly dead, as a woman rushes over to help. Near him is a woman, taking cover between a garbage can and the wall.

A person is shown lying motionless to the left of the table, under a shade covering set up over it, as a woman tries to help. Nearby, by the wall of the building, a man lies on his side in a pool of dark blood, with a bandage on his back. 

A voice tells him, “Try not to move,” adding, “Stay with me, OK?”

Wailing is heard in the background, as people tend to others lying injured nearby. (source)

You have to know what to do before an event like this occurs.

One factor that allows shooters to get so many victims is that most folks don’t know what to do in such an event. Most people don’t think ahead when they’re going to Wal-Mart or enjoying an evening in a popular pedestrian area.

But these days, a person has to have a plan anywhere they go, it seems. And they also have to have a survival mindset, practicing the 3 steps of survival repeatedly until it becomes completely natural for them.

If you are in the first wave of victims, that’s just bad luck, and there isn’t much you can do about that. But if you are not in that first wave, then you have a chance to take action and survive. But you have to know what to do and be able to take those life-saving actions.

What is not important if you find yourself in the midst of a shooting

This is an unpopular opinion, but here goes.

Strictly from a survival point of view, it doesn’t matter who it is doing the shooting or whether it’s a “false flag.” If you were present during these events, it does not aid your survival to know who committed the acts of terror that occurred on 9/11, on the streets of Boston, in London, or in Paris. It doesn’t matter whether the shooting at Sandy Hook was perpetrated by a kid with behavioral issues or by operatives with an agenda. It doesn’t matter that the guy shooting up a Walmart in Texas wrote an anti-Hispanic manifesto.

If your focus is preparedness and survival, the most important thing you can be doing right now is learning from horrific events.

Whether you believe these acts are at the hands of Muslim extremists waging jihad, someone who hates Hispanic people, a guy who hates women because he can’t get a date, or a state-sponsored act of terror to clamp down and take away more freedom, the single most important thing you can take away from any of these events is a lesson in survival.

This article is not a debate about the different conspiracy theories. If you are present during a terror attack, my opinions on the culprit don’t matter and neither do yours. All that matters in those minutes or hours is surviving.

So let us try not to get bogged down in a debate over how these two shootings within 24 hours make it easy for all the 2020 candidates to pull on the heartstrings about gun control. What matters is whether you can survive in such a scenario.

Here are the things you need to do before a shooting ever happens.

First things first, even when you’re there for fun, you must be paying attention. You should always scan an area for exits and potential cover. You should pay attention to the people around you. You should understand what the baseline behavior is for your setting so that if something is not baseline, it immediately catches your attention. Let me explain this further.

We can maintain a high level of situational awareness merely by being observant. One way to develop your skills is to play something called Kim’s Game.  My friend Scott, at Graywolf Survival, used to use the game to train his soldiers in situational awareness. He wrote:

Situational awareness is key to understanding your environment so you can know better both your circumstances and your options. There are myriad examples that could be given but would you notice the bulge (called printing) of someone’s ankle from a concealed weapon if you were asked to follow him to barter for goods? Would you remember enough details of the turn of a path you passed two hours ago to be able to find it again? If you were attacked, would you be able to give a good enough description of the subject and getaway vehicle to have him identified?

Kim’s Game comes from a novel by Rudyard Kipling and is something you can play with your family, anywhere, anytime. Go HERE to learn more about how to play it.

A higher level of situational awareness can help you in many ways, should you be unfortunate enough to be present during a mass shooting.

It can help by:

  • Allowing you to identify a threat before it becomes active

  • Allowing you to locate exits and routes to the exits

  • Allowing you to determine sources of cover

If you can identify a potential threat before it exists, you can sometimes prevent an attack or at the very least, you can protect yourself and your family more effectively. A book by Patrick Van Horne and Jason A. Riley describes this as being on the “left of bang”. The left of bang is a term used to describe the moments before something bad happens, when you have an inkling that something is wrong, but you just can’t put your finger on what it is.

The book, Left of Bang: How the Marine Corps’ Combat Hunter Program Can Save Your Life, discusses how establishing a baseline can help you to identify a threat. (I can’t recommend this book strongly enough.)

A baseline is a “normal” for your immediate environment. Once you have a baseline for behavior in a specific environment, then it’s easier to spot anomalies. According to Left of Bang, it’s the anomalies that should put you on high alert. “Anomalies are things that either do not happen and should or that do happen and shouldn’t.”  

The earlier you’re aware that something is going down, the better your chances are of survival.

Know what gunfire sounds like.

A lot of people who were interviewed after the Walmart shooting said that when they first heard the shots, they didn’t realize what it was. They thought it was noise from construction or boxes being dropped. There were precious seconds when people were frozen targets while they tried to wrap their brains around what was actually happening. During an event like this, a pause of a few seconds could mean the difference between life and death. The faster you take action the more likely you are to survive.

Always have a plan.

We can’t foresee all eventualities, like this one, for example, but it helps to always have a survival mindset. It has long been a game with my kids (yeah, we’re a strange family) to identify exits and potential weapons if we sit down to eat at a restaurant or go to the movies. Something we focused on in Selco’s Urban Survival Course in Croatia was finding alternative exits in a mall, locating cover, and finding everyday items that could be used as weapons.

Knowing where to go without having to look for it in the heat of the moment will save time that could be spent acting.  We also look for sources of cover.

Understand the difference between cover vs. concealment.

Every NRA course I’ve ever taken discusses the difference between cover and concealment, because in many cases when you are forced to use your own firearm, there’s another person who is ready and willing to shoot back. Concealment is enough to hide you but not enough to protect you from bullets. Cover is something sturdy enough to stop a bullet – a concrete structure like a road divider, the engine block of a car, a refrigerator, a steel door, a brick wall.

When watching the video playback of the Las Vegas shooting, many people were seeking concealment behind flimsy barriers, and that is not enough to protect yourself in a situation with a high-powered gun and a shooter spraying an area.

Separate from the crowd.

In a mass shooting, the shooter is trying to take down as many people as possible, so most likely he will aim at the crowd instead of picking off people who moved away from the bulk of the group.

One possible strategy would be, then, to get away from the crowd. You and the person/people you are with would be less alluring than a group of a hundred panicked people all huddled together where maximum harm could be achieved.

Don’t get down or play dead.

Lots of people crouched down and got as low as they could. In many situations, this would be the best bet, but not this one. The person was shooting from up high, aiming downward. Being still and crouching down wouldn’t do much to protect you from a person firing from this angle, nor would playing dead.

Action is nearly always a better choice than inaction. As well, getting down would make it more likely that you’d be trampled by a panicked crowd of people trying to get away from the area. Clark County Fire Chief Greg Cassell said after the Las Vegas shooting that some of a “wide range” of injuries included people who were trampled by the panicked crowds.

Listen for reload.

In a situation like this, there will be pauses in the shooting when the person stops to either reload or change firearms. That is your opportunity to make a dash for the exits or to take down the attacker. Don’t wait too long to make your move, because it only takes an experienced gunman a few seconds to reload a familiar gun and then your chance is gone.

There are only 3 courses of action.

Sometimes regardless of how alert and observant we are, we can’t predict when an attack is about to happen. There might be no indications in your immediate surroundings to alert yourself to the fact that something is going down. You may be blithely unaware until the moment that a perpetrator starts firing.

If you find yourself suddenly in the midst of a mass shooting, your actions should be one of the following:

1) Escape. Get as far away from the threat as possible. This is where your early observant behavior comes in handy because you’ll already know the escape routes. If you are in charge of vulnerable individuals like children, your first choice of actions should be to get them to safety if at all possible.

2) Take cover. If you can’t get away, get behind something solid and wait for your opportunity to either escape or fight back. This is something else you may have observed when doing your earlier reconnaissance.

3) Take out the threat. If you are armed (and I really hope you are) and/or trained, use your abilities to help remove the threat. But know that sometimes you can’t get a clear shot without putting other people at risk. Understand the power of your firearm and ammunition – will your bullet go through the perpetrator

The most important thing to consider here is not necessarily which action you will take. It’s that you willtake an action, not just stand there in shock. You can be a victim or you can be a warrior. Unfortunately, modern life seems to have made our survival instincts obsolete but you can overcome this with practice and study.

Keep in mind that fighting back doesn’t always mean a fancy Krav Maga move that takes down two armed men with one trick maneuver. There are many ways to fight back, and not all of them require physical prowess. Don’t let fear incapacitate you. Your brain is a weapon too.

Are you going to wait for someone to save you or are you going to save yourself? Don’t be a kamikaze, but look for your opportunity.

And there comes a point in some of these situations in which survival is unlikely. Don’t go down without a fight.

“We’re Already Starting To Ration Our Corn” – Perfect Storm Could Send Spot Prices Higher

Corn is extensively used to feed livestock, but the surge in spot prices has forced US farmers to search elsewhere for low-cost substitutes, reported Reuters.

The persistent wet weather that swamped the Midwest this spring is now reducing corn yields.

More recently, dry, hot weather continues over large swaths of the Midwest, is also wreaking havoc on corn yields. Volatile weather as a whole, in 2019, could lead to one of the lowest corn harvests in years.

The US Department of Agriculture (USDA) last month projected 2019 corn production at 13.88 billion bushels, an 8% drop YoY.

Agricultural organizations, equipment dealers and factories that convert corn into ethanol have already felt the pressure from farmers because of millions of acres went unplanted due to wet weather across the Central and Midwest, including corn and soybean belts.

Reuters spoke with meat producers who are now rushing to find substitutes to avoid margin compression from skyrocketing corn prices; they’re attempting to stretch out supplies of corn held in storage.

Experts have warned spot prices of corn could jump once harvesting begins this fall because declining yields will be realized.

Higher prices for corn could translate into higher meat prices, which are already soaring after China’s African swine fever crisis has led to the deaths of hundreds of millions of pigs.

USDA supermarket data showed retail pork prices had soared 9% YoY versus this time last year, while beef prices are up 2%. Rising food costs are occurring at a time when the overall economy is rapidly slowing.

The wettest 12 months on record in the Midwest has put thousands of farmers behind the planting season. The number one risk is that corn might not reach full maturity and early frost could devastate crop yields even further.

The USDA shows about 57% of the US corn crop is in good condition, plunging from 75% at this time last year.

High corn prices have led to margin compression for major meat producers like Tyson Foods, who will ultimately pass on the costs to consumers.

Cargill said last month its quarterly net profit crashed 67% from last year, partly due to disruptions in the growing season in spring.

“End users are in a panic,” said Tanner Ehmke, industry research manager for agricultural lender CoBank.

Crop traders, ethanol plants, and livestock producers “want corn now because of the unknowns on this crop.”

Jason Britt, president of Central States Commodities, said rains and floods are making farmers “tighter-fisted. Britt said his family’s northern Missouri farm has 100,000 bushels of corn in storage; traders are already offering him a premium for the crop.

“The circumstances have changed this year, so for us [we need] a larger security blanket,” Mr. Britt said.

Ohio farmer Jim Heimerl sells 700,000 pigs per year, has swapped out corn with expired pet food, which he acquired in bulk through a broker. Heimerl is feeding the pigs other substitutes, including wheat middlings.

“We’re already starting to ration our corn out,” he said.

Corn spot prices chart

For the first half of August, weather models show cooling weather prevailing through the Central and Midwest. Reuters noted this could further delay crop development at a time when corn needs it the most:

“1-15 Day Forecast: Model guidance (both GFS & EC) remains consistent showing cool weather prevailing through the first half of August across the Central and Midwest U.S., including the Corn and Soybean belts. As mentioned in previous reports this could further delay crop development and be the potential catalyst of future issues should the season be pushed back even further as a result. Moreover, both models agree on expected rainfall across most areas through 10 days. A widespread pocket of dryness is expected across Wisconsin, Iowa, northern Missouri, Illinois, Indiana, and Ohio. Furthermore, the GFS extends this period of dry weather through the 11-15 day time frame. As mentioned in recent updates, continued dryness across some areas in Illinois, Indiana, and Ohio could become more of a concern for corn and soybeans in key developmental stages if prolonged.

Extended Outlook: The EC extended run from 01 August paints a different picture than the former run from 29 July. This most recent backs off from extensive coolness across the central/Midwest U.S. which was shown in the 29 July scenario, and rather limits lasting coolness to Canada and the far northern U.S. Plains. The rest of the U.S., including the Midwest, is now expected to be warmer than normal when averaged through the next 4 weeks, though this is just one model run. This most recent run also depicts wetter conditions across the Midwest U.S., opposed to the run from 29 July which shows dry conditions across much of the region. Overall, if materialized later in the month this would be a more favorable scenario with warmer and wetter conditions possibly returning.”

Perhaps a perfect storm of factors mentioned above could result in the second leg up in corn spot prices in the months to come, especially around harvest time in fall.