farmgate: Extension Update
Extension Update is a weekly summary of news from Extension, government, and other attributable sources, focused on marketing, farm management, and other issues that are of interest to Midwestern farm owners and operators. UPDATED WITH OCT. CROP REPORT DATA.
USDA pushed up its estimated corn production to 12.199 bil. bu. in the October Crop Report, compared to 12.072 bil. in Sept. and well above the 12.076 bil. bu. estimated by the market. Average yields were raised from 172 to 177 in IL and from 168 to 172 in IA. Yields were lowered 162 down to 160 in IN, and from 152 to 147 in OH. USDA said September rains improved prospects in the Central Cornbelt, but continuing dryness hurt yields in the Eastern Cornbelt.
The Oct. soybean estimate was also raised by USDA, but most of the increase came from higher yields outside the Cornbelt. Total production was estimated at 2.983 bil. bu., compared to the 2.934 bil. estimated in Sept. and the trade guess of 2.920 bil. USDA raised yield estimates from 42 to 45 in IL, but lowered estimates in other Cornbelt states. The national average was lowered from 40 to 39.5 bu. per acre, however USDA raised the estimated harvested acreage by 3% to 75.5 mil. acres to achieve the higher production number.
In the USDA Supply and Demand Report, feed use was raised from 5.2 to 5.35 bil. bu. of corn, ethanol used was lowered from 4.1 to 4.0 bil. bu. and exports were held steady at 2.0 bil. bu. Ending stocks were raised from 1.018 bil to 1.154 bi.. bu. USDA substantially lowered its farmgate estimated price for corn by 80 cents per bushel to a range of $4.20 to $5.20.
The soybean Supply Demand Report reduced the crush estimate from 1.785 bil. to 1.760 bil. bu. and raised export estimates from 1.0 bil. to 1.05 bil. bu. Ending stocks were also raised from 135 mil. to 220 mil. bu. USDA also chopped $2 off the farmgate price for soybeans from the Sept. estimate of $11.60 to $13.10, down to the Oct. estimate of $9.60 to $11.10.
The market expected corn carryout a year from now at 1.138 bil. bu., which is up 20 mil. bu. from the Sept. estimate. That compares to the 1.624 bil. carryout at the end of Aug., which was more than the market expected. IL Extension’s Darrel Good said that was probably due to less expensive wheat replacing corn in livestock feed this summer.
As you watch the global economic dynamics, Purdue economist Mike Boehlje says, “So far, availability of credit is not a big concern. At this point we don't have the freezing of credit markets for the ag sector. The more serious issue for agriculture is the potential recession." A recession could hurt the sale of agricultural products here and abroad.
Agri-politics: Trade. Sen. Obama has been a reluctant supporter of free trade who has called for reviews of trade agreements to make sure they protect labor and environment, says NE Extension public policy economist Brad Lubben. Sen. McCain strongly supports liberalizing trade, removing barriers and pursuing international trade agreements. He says, "There's a lot of pessimism about how big these trade opportunities are, so the whole agriculture industry is not unanimous in its agreement that all trade is good."
Agri-politics: Energy. Nebraska’s Lubben says, “Sen. Obama supports the use of biofuels as well as alternative and renewable fuels and energy conservation. McCain supports the use of all energy sources, including nuclear power, and less reliance on subsidies and import tariffs.” Lubben says, “Obama's support for alternative fuels and energy conservation sounds good, but "very few people want to consume less energy.”
Agri-politics: Farm policy. Neither presidential candidate has a strong agricultural background, and Lubben says the key will be who they put in their inner circle to advise them on issues. He says the new administration may have to address the controversy over which year’s prices are used in the formula for ACRE payments, as well as give final resolution to the inclusion of farms under 10 acres in the farm program.
Avoid the “John Deere lows” in January, and having to sell grain to make rent, loan, and machinery payments says MO Extension specialist Randa Doty. Advocating the need for a marketing plan, she says, "There's usually a flood of grain on the market when payments are due." She says advanced planning is important in a volatile market. She is recommending a variety of resources found here.
If you are harvesting wet corn, drying costs may be upwards of 50¢ per bushel, and that is a large share of your profit. But calculating drying, storage, shrink, and any other handling charges at elevators can be difficult. Save yourself time and money by using a grain delivery decision aid provided by IL Extension ag economists. Read more about it.
The Grain Delivery Model compares net revenues across three elevators, if you enter such information as shrink, drying costs, and storage charges. Net revenues can be substantially different, says Extension Farm Management Specialist Gary Schnitkey, even though elevators may be offering similar bids for grain delivered. His examples resulted in more than $130 difference on 1,000 bu. of corn delivered to 3 elevators.
Although state laws vary, the time may be approaching in many for lease termination deadlines. It is usually incumbent upon both the land owner and the operator to give the other written notice if any changes in the leasing arrangement are being made, including terms of the lease. Courts usually hold verbal leases in the same value with written ones.
Managing volunteer corn in continuous corn can be easy or difficult, says OH Extension’s Mark Loux, who says it depends on 2008 hybrids. Read more.
1) Where non-GMO corn was planted, plant glyphosate-resistant or Liberty Link corn.
2) Where Liberty Link corn was planted, glyphosate-resistant corn can be planted.
3) Where glyphosate-resistant corn was planted, Liberty Link corn can be planted.
4) For corn resistant to both glufosinate and glyphosate, there are no chemical options.
5) For multi-resistance corn, consider switching that field to soybeans for 2009.
Hurricane Ike, which flattened thousands of acres of corn in the Eastern Cornbelt, can be blamed for field loss, immature corn, and grain quality problems, says Purdue’s Bob Nielsen. Read more.
1) Corn will develop a black layer even if it was not mature, but ears will be rubbery.
2) Rubbery ears of corn will be difficult to shell without re-adjusting combine settings.
3) Stage of maturity of the corn determines grain quality when plant died or began to die.
4) Yield reduction is 35% at soft dough stage, and could be over 22% even fully dented.
5) In severely downed corn, pick up reels will be needed, if stalk breakage is severe.
To avoid too much deadheading in harvesting downed corn, Purdue’s Nielsen says, “Some growers advocate harvesting a full header width in the direction the stalks are broken, “deadheading” back, shifting over less than a header’s width, harvesting another header’s width in the direction of the broken stalks, then harvesting the partial header width strip back in the opposite direction and repeating the process.” It is worth a try.
An update on molds and fungi comes from Purdue specialists, who have tested corn for those problems since 1989. They report 10 of 256 samples warrant testing for either fumonisin or DON, which produces vomitoxin. The number of ears with molds is less than observed in 2006, but in that year also, some late rains caused ear rots to worsen.
Don’t throw safety to the wind, if wind downed your corn. The main issues farmers will be facing in harvesting downed corn include slower operating speeds; more frequent header plugging; more rocks picked up by the header; and more corn stalks going through the combine along with the grain, slowing grain separation and contributing to more grain thrown out the back of the equipment, says Ohio State ag engineer Randall Reeder.
Safety will be an issue this fall, says OSU’s Reeder. “Because of downed corn, harvest will drag on longer than usual, the header will plug more often, and operator stress and frustration will be higher.” He says frustration will grow with ears lying on the ground.
Soybean disease can be reduced by tilling soybean stubble. Iowa State plant pathologist X. B. Yang says many foliar and stem diseases live in soybean residue, but if the residue is buried with tillage, it decomposes and the fungi will die. Among those are white mold, SDS, and phythophthora. However, Rhizoctonia and SCN are not affected by tillage.
If you don’t have time to fall till your soybean stubble, IL Extension’s Bob Frazee says your soil is better off. Sampling IL fields, he says 25% of the cropland has ephemeral and gully erosion, and much of it is in soybean fields that have been fall tilled. Frazee says research shows that corn yields are unaffected by the lack of bean stubble tillage.
It will take one acre of corn next year to pay for fertilizing itself and three others. You may be spending $250 per acre for N, P, & K in 2009 says IL Extension’s Mike Roegge to just replace what the 2008 crop took out of the ground. If a build up is needed, that will be extra. Roegge says the most accurate fertilizer decisions use soil test results.
With high input costs, farmers will need to maximize their income per acre, such as selling straw as well as wheat. Corn stalks can be harvested, but how is a price calculated per ton? NE Extension specialists say it equals the value of the crop nutrients removed from the field, yield loss, soil loss, and cost of raking, baling and hauling. Their value is $53.51 per ton of corn stover. Read more.
The first frost will bring concerns about prussic acid forming in sorghum or sudangrass, and Iowa State forage specialist Stephen Barnhart says livestock should be taken off the frosted forage for 3 to 4 days if it was 30 in. or taller. Any pasture shorter than that should be livestock free for 10 days to 2 weeks. Affected sudangrass can be cut and baled or ensiled, since the wilting process will cause the hydrocyanic acid to deteriorate.
2008 hog slaughter is estimated 7.5% more than the 2007 record, but slaughter rates in the first quarter of 2009 should be down 2% says MO livestock economist Glenn Grimes. And he says second and third quarter slaughter rates should fall enough for prices to be at or above the cost of production for the average cost producer. Grimes qualifies that by saying that demand must not diminish and 2009 must produce a normal corn crop.
Posted by Stu Ellis on October 10, 2008 12:04 AM to farmgate