Wednesday, October 21, 2020

North Dakota Continues To Lead Nation In Honey Production -- October 21, 2020

Last week we mentioned that North Dakota was on track to regain the title as the nation's #1 soybean producer which it lost for one year,

Now honey. 

From AgriLife Today, yesterday:

Texas remained sixth in the nation for honey production in 2019, and is home to thousands of overwintering hives that contribute to the nation’s agricultural economy each growing season. Molly Keck, AgriLife Extension entomologist, Bexar County (San Antonio), said Texas beekeeping falls into three categories – hobbyists, sideliners and commercial.

Hobbyists are backyard beekeepers who keep bees, typically less than 10 hives, to meet Texas’ agriculture exemption for property taxes and/or to produce honey for their household, to share and/or sell locally. Sideliners typically have 50-250 hives but also maintain a full-time job.

“The plight of the honeybee and beekeeping to protect populations is a part of the increasing trend of hobbyist beekeepers,” Keck said. “But around 75% of the residents who participate in our Beekeeping 101 course are doing it to get that ag exemption with the bonus being honey for themselves and to share with family and friends and maybe sell at local farmers markets.”

Commercial beekeepers are those who keep 500 colonies or more. Their livelihood depends on bee husbandry and by moving large numbers of hives around the state and nation to pollinate crops and/or produce honey.

In Texas for instance, a commercial beekeeper may deliver hives in the Rio Grande Valley to pollinate watermelon fields and move those same hives to the Texas Plains to pollinate cotton later in the growing season. Then in the summer they may move their colonies to South Dakota or North Dakota for clover honey production.

The annual U.S. Department of Agriculture honey report in March 2019 showed 132,000 honey-producing colonies in Texas. By comparison, North Dakota, the No. 1 honey-producing state, reported 550,000 colonies
Texas colonies produced 7.4 million pounds of honey in 2019, according to the USDA report. Total U.S. honey production topped 154 million pounds.

Even though the top honey-producing states are North Dakota and South Dakota, California, Florida and Minnesota, Rangel said thousands of those hives are based, or at least overwinter, in Texas as the state offers a mild winter climate for bees.

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Diwali

For planning purposes, Diwali falls on Saturday, November 14, this year (2020). A five-day Hindi festival, the big celebration is generally on the third of the five days, which this year is Saturday, November 14.

The celebration of sisters occurs on the fifth day, November 16, 2020. Sophia considers herself Anika's sister. 

Anika lives in the apartment building two units down from our little hovel. 

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Catcher In The Rye

First published in mid-July 1951 by Little, Brown and Company, Catcher in the Rye was simultaneously published as a Book-of-the-Month Club selection. By the end of July [two weeks after initial publication], Little, Brown and Company was reprinting the novel for the fifth time, and by August, Catcher had reached fourth place on the New York Times best-seller list.

-- Salinger, David Shields and Shane Salerno, c. 2013, p. 271

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At One Time, Freddie Held The Record
Number of Appearances On American Bandstand

Palisades Park, Freddie Cannon

Elliott Management Corp, Follows Carl Icahn To Florida -- Says Sayonara To High-Tax State New Jersey -- October 21, 2020

From ZeroHedge:

Ever since David Tepper revealed that he was moving back to New Jersey after briefly seeking the greener pastures (and substantially lower tax rates) of the Sunshine State (Phil Murphy said he received a personal phone call from Tepper, informing him about the additional $100 million+ in tax revenue headed to NJ), smug liberals on CNBC have been smirking about how wealthy financiers want to be where the talent is/simply can't tolerate not having the opportunity to see three Andrew Llyod Weber musicals a week (though it's not like anybody's going to see a Broadway show right now).

While Manhattan remains the undisputed hedge fund capital, Florida, particularly South Florida and Miami, has seen a steady influx of capital and people over the past five years. Last fall, Carl Icahn announced plans to move his firm's headquarters to Florida, offering employees generous severance packages if they opted not to follow the firm to Florida.

Now, Bloomberg reports that Elliott Management Corp., the investment fund run by Paul Singer, is taking its $41 billion AUM and moving it to West Palm Beach, a community best known to Americans as the former hunting grounds of Jeffrey Epstein. 

And more:

As Bloomberg points out, Elliott isn't alone in expanding its presence in South Florida. Ken Griffin’s Citadel plans to open an office in Miami next year, and $8 billion Balyasny Asset Management, another Chicago-based firm, is also opening office space in Florida, and will have space for 30 employees by the end of the year.

It appears most of Elliott's employees are staying put, which suggests Paul Singer is simply trying to side-step the burgeoning trend of liberal states dabbling with 'wealth tax' plans to plug the gaping holes in their budget caused by COVID-19. For example, Griffin is leading a campaign against a wealth tax in Illinois. Jamie Dimon recently bashed a proposed wealth tax plan in NY being pushed by - who else? - AOC.

Just imagine: a one-time bartender, now first term US representative, living rent-free in Jamie Dimon's head. LOL.

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Preparing For Baking With Sophia

Yesterday Sophia and I made brownies but she took them home with her and left me none.

So, today I plan to bake a cake with Sophia. 

Everything is ready. All she has to do is crack the eggs, pour everything together, and then mix. 

Demand Destruction, Third Wave, and No US Stimulus: WTI Drops Below $40 --Slawson With Four New Permits; Five Permits Renewed; One DUC Reported As Completed -- October 21, 2020

Active rigs:

$39.81
10/21/202010/21/201910/21/201810/21/201710/21/2016
Active Rigs1462715434
Active rigs decreased by one today, but it means nothing. The Red Trail Energy rig is off the list. That was a carbon capture and storage well; irrelevant. There is no change in the number of active oil and gas wells  (14). 

Four new permits, #37917 - #37920, inclusive -- note there is a mistake on the daily activity report, the scout tickets are accurate -- the information below is from the daily activity report with [my] corrections. The scout tickets do not show the BR well / #37917; the scout tickets show permit #37917 to be the fourth Slawson permit today, Whirlcat Federal 4-31-30TFH. The daily activity report will probably be corrected tomorrow. I've never seen an error with scout tickets; recently I've seen many errors with the daily activity report.

In fact, the error on the daily activity report, BR's Sequoiafill 1D is permit #37617, not #37917 as shown on the daily activity report. Slawson has four new permits, #37917 -#37920, inclusive.

  • Operators: Slawson (3); BR -- that's an error -- should be four new Slawson permits, no new BR permits;
  • Fields: Big Bend (Mountrail); and, Hawkeye (McKenzie) -- that's an error; all new permits should be shown as in Big Bend (Mountrail); none in Hawkeye (McKenzie County) today;
  • Comments:
    • Slawson has permits for a 3-well Sniper Federal (2) / Whirlcat (1) pad in lot 3, section 6-151-92, from 279' to 288' FNL and from 1270' to 1570' FWL, Big Bend, which is wrong; there were four permits for Slawson for a 4-well Sniper Federal  (2) / Whirlcat pad (2); 
    • BR has a permit for a Sequoiafill well in section 36-153-95, 870' FSL and 2620' FEL; Hawkeye oil field; that's wrong; BR did not get any permits today
  • Comment: when I see Slawson active in the Bakken, that's a huge positive indication that things are improving; privately-held; this family-owned company is very conservative; it made my day to see Slawson active in the Bakken;

Five permits renewed:

  • EOG (4): four Burke permits in Mountrail County;
  • Hunt Oil: a Rulson permit in Mountrail County;

One producing well (a DUC) reported as completed:

  • 33686, SI/A, Crescent Point Energy, CPEUSC Berner 6-19-18-157N-99W, Lone Tree Lake, API 33-105-04463; t--; cum 104K 8/20;

Sidebar Discussion -- CLR, MRO In A "Consolidation Environment" -- October 21, 2020

A reader responded to thoughts about future of CLR in a "consolidation environment." [Of course, there's still Whiting, Oasis, and a host of others to consider.] But not to lose the comment, and to make it easier to access (browser search), I've brought a comment from another post to this page, as a stand-alone post:

Not sure if this is GMTA ("great minds think alike" or if my constant mentioning of the fit of MRO/CLR has actually percolated to analysts (or even the companies). But...I told you so. LOL.

"Of those companies left, there’s speculation that billionaire Harold Hamm’s Continental Resources Inc. may come to some agreement with Marathon Oil Corp., Paul Sankey, a New York-based analyst at Sankey Research said in a note."

https://www.worldoil.com/news/2020/10/21/us-shale-mergers-reshuffle-the-oil-production-landscape
.

Note that CLR and MRO are both below $5B market cap, so the combination leaves them still less than Scott Sheffield's magic $10B level.

And they're both "good companies" on some intrinsic level. But given their debt and given $40 WTI strip, you have to really look at it as more like two weak sisters teaming up.

Still wonder who would run it and what would happen to the different organizations. Have to imagine MRO would as the more sophisticated multi-basin player. But Harrold's stake would still be 40%+ of the combined company. Maybe he would take it over? Interesting, interesting.

My reply:

The "two-weak-sister" argument is an incredibly good argument. As things consolidate -- it's sort of like musical chairs -- all the "stronger" companies -- made stronger by mergers, acquisitions -- start to take seats away from the table for the other weaker players. To get a seat at the table, these weaker "sisters" may need to join forces. 
One could see MRO with a wholly-owned subsidiary (CLR) run by Harold Hamm, giving Harold Hamm a directorship on the Board of Directors of MRO ... or as the reader suggests, something even bigger. It also makes it easier to spin off CLR down the road if things improve to make it possible. So many opportunities.

So, let's look at that linked "worldoil" article. Oh, wow, this is getting scary. I actually had that link from overnight and was going to post it later today -- after Sophia and I were finished for the day -- that is amazing -- a gazillion articles that could have been linked by either the reader and/or I and that's the one.

I already had the graphic ready to go. It's at the worldoil link above (archived):

I'll have to check CLR production later, but I believe it is in the 350K+ range but I could be way wrong. If it is 350K boepd, CLR would exceed Chevron and maybe even ExxonMobil, depending whether we're comparing "bbls of oil" or "bbls of equivalent oil."

CLR is tracked here

Over at SeekingAlpha, an article addressing this very issue just popped up. 

  • "There's only going to be three or four independents that are investable by shareholders" among energy producers after the recent market rout, Pioneer Natural Resources CEO Scott Sheffield tells analysts after his company agreed to buy Parsley Energy for $4.5B in stock. 
  • "The best companies have been picked off in the past few weeks." Sheffield believes the "real survivors" will be Pioneer-Parsley, EOG Resources, ConocoPhillips, and "maybe" Hess over the long-term. 
  • Pioneer's purchase of Parsley will save ~$325M/year in debt repayments and cost reductions while also adding to free cash flow, but size also is key to the deal's success, Sheffield says. 
  • "When you're talking to most investors today, they are only looking at companies that are investable at a $10B market cap," and companies below that level will need to merge over time. 
  • Sheffield tells Bloomberg that his son, Parsley Chairman Bryan Sheffield, will not have a role in the combined company and will be a major investor, but Scotiabank analysts believe investors nevertheless may have concerns over the conflicts of interest between the two companies, which it sees as a buying opportunity. 
  • TD Securities upgrades Pioneer to Buy from Hold, citing earnings accretion from the deal, as well as added size and scale. 
  •  For Parsley investors, the premium may be a slight disappointment, according to analysts at Tudor Pickering Holt.

Weekly EIA Petroleum Report -- US Crude Oil Inventories Are 9% Higher Than November, 2018 -- It's Sure Taking A Long Time To "Re-Balance" -- October 21, 2020

EIA, weekly petroleum: Link here. API build reported yesterday did not materialize in EIA report.

  • weekly US crude oil inventories: decreased by 1.0 million bbls
  • weekly US crude oil inventories now stand at 488.1
  • weekly US crude oil inventories are about 10% above the ever-increasing five-year average
  • refineries operated at 72.9% capacity;
  • imports: down almost 14% from same four-week period last year
    • imports averaged 5.1 million bpd, down 167,000 bpd the previous week
  • propane/propylene inventories are about 11% above the five-year average
  • jet fuel product supplied was down 46% compared with same four-week period last year
  • gasoline demand will be reported later today

Re-balancing (US crude oil imports):

Week

Date of Report=

Change

Million Bbls Storage

Over/under 5-year average

Week 0

November 21, 2018

4.9

446.9


Week 1

November 28, 2018

3.6

450.5


Week 2

December 6, 2018

-7.3

443.2


Week 3

December 12, 2018

-1.2

442.0


Week 4

December 19, 2018

-0.5

441.5


Week 5

December 28, 2018

0.0

441.4


Week 84

July 15, 2020

-7.5

531.7

17%

Week 85

July 22, 2020

4.9

536.6

19%

Week 86

July 29, 2020

-10.6

526.0

17%

Week 87

August 5, 2020

-7.4

518.6

16%

Week 93

September 16, 2020

-4.4

496.0

14%

Week 94

September 23, 2020

-1.6

494.4

13%

Week 95

September 30, 2020

-2.0

492.4

 

Week 96

October 7, 2020

0.5

492.9

12%

Week 97

October 15, 2020

-3.8

489.1

11%

Week 98

October 21, 2020

-1.0

488.1

10%

Crude Oil imports:

Week (week-over-week)

Date of Report

Raw Data, millions of bbls

Change (millions of bbls)

Four-week period comparison

Week 0

March 11, 2029

6.4

0.174


Week 1

March 18, 2020

6.5

0.127


Week 2

March 25, 2020

6.1

-0.422


Week 13

June 10, 2020

6.4

0.000

-13.300%

Week 22

August 12, 2020

5.6

-0.389

-20.400%

Week 23

August 19, 2020

5.7

0.109

-21.700%

Week 24

August 26, 2020

5.9

0.185

-16.900%

Week 25

September 2, 2020

4.9

-1.000

-20.200%

Week 26

September 10, 2020

5.4

0.500

-17.900%

Week 27

September 16, 2020

5.0

-0.416

-20.100%

Week 28

September 23, 2020

5.2

0.160

-24.200%

Week 29

September 30, 2020

5.1

0.045

-21.600%

Week 30

October 7, 2020

5.7

0.600

-18.900%

Week 31

October 15, 2020

5.3

-0.447

-15.400%

Week 32

October 21, 2020

5.1

-0.167

-13.800%

 

Distillate fuel inventories:

Week

Date of Report

Change in Millions

Relative to 5-Yr Avg

Week 1

August 26, 2020

1.40

24.0%

Week 2

September 2, 2020

-1.70

23.0%

Week 3

September 10, 2020

-1.70

20.0%

Week 4

September 16, 2020

3.50

22.0%

Week 5

September 23, 2020

-3.40

21.0%

Week 6

September 30, 2020

-3.20

21.0%

Week 7

October 7, 2020

-1.00

23.0%

Week 8

October 15, 2020

-7.20

19.0%

Week 9

October 21, 2020

-3.80

19.0%

Jet fuel delivered:

Week

Date of Report

Change

Week 0

3/7/2020

-12.80%

Week 1

3/14/2020

-12.60%

Week 2

3/21/2020

-8.90%

Week 3

3/28/2020

-16.40%

Week 4

4/4/2020

-0.22%

Week 5

4/11/2020

-39.70%

Week 6

4/18/2020

-53.60%

Week 7

4/24/2020

-61.60%

Week 8

5/1/2020

-66.60%

Week 9

5/8/2020

-68.50%

Week 10

5/15/2020

-67.90%

Week 11

May 22, 2020

-66.60%

Week 20

July 29, 2020

-42.10%

Week 21

August 5, 2020

-40.90%

Week 22

August 12, 2020

-45.80%

Week 23

August 19, 2020

-47.60%

Week 24

August 26, 2020

-45.70%

Week 29

September 30, 2020

-46.10%

Week 30

October 7, 2020

-47.50%

Week 31

October 15, 2020

-41.80%

Week 32

October 21, 2020

-45.90%