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October 30, 2009
Cornbelt Update
Cornbelt 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.
At the outset of the week, 43 million acres of soybeans remained in the field and 63.5 million acres of corn were still standing. KS State marketing specialist Mike Woolverton says that is causing the market to talk about yield losses and quality problems. But he says there is no way to judge the impact until enough is harvested to give a good picture.
Despite the delayed harvest and its related problems, Woolverton says prices fell as farmers sold to capture the previously high prices, overseas buyers pulled back because of high prices, and “the anemic dollar gained in value.” But he says the market really turned down because of the longterm weather forecast for better harvest weather ahead. Woolverton says the dollar has been on a downward trajectory, and when that happens oil prices move back toward the $80 range and grain and oilseed prices follow the oil lead.
Woolverton says crop analysts have lowered private yield projections for corn and beans. He says if the national average corn yield is 160 bu., ending stocks will be 10% of usage, but he says if ending stocks drop below 10% of use, the supply tightens and prices rise. Read more.
Think about these issues, which Woolverton discusses in his newsletter:
1) 10-12 days of good weather will be needed for crops and fields to dry out, then soybean harvest will move faster than corn, which will slow from a drying bottleneck.
2) Market analysts say harvest lows are in when at least half the crop is harvested, which will be soon for soybeans but will take another week and a half for corn.
Don’t wait for “Indian summer,” says Purdue agronomist Bob Nielsen, if your standing corn is too wet to harvest. He says stalk health and grain quality continue to deteriorate due to the processes of weathering and disease. Nielsen says grain moisture typically decreases not much more than ¼ to ½ a percentage point per day at normal temperatures.
Nielsen cites the average daily temperature in IN as 53º for October, but that drops to 42º for November. He says that explains why the rate of grain moisture loss in the field drops quickly in October and “flat lines” through November. He says if you factor in the cooler than normal October temperatures this year it is no surprise why grain moisture has not changed very significantly in recent weeks. He says don’t expect much more. Read more.
You may have moldy corn, but is it a real problem? OH State specialists say before abandoning a cornfield, make several determinations. They say ear mold may not be widespread within a field, and it may not be the variety that causes mycotoxins. Read: more about ear rots.
1) Walk you fields, and examine multiple ears for signs of ear rot.
2) If you have an ear rot, determine its variety and whether it produces mycotoxins.
3) If the mold is a hazard, determine how widespread it in throughout the field.
4) Examine 50 to 100 ears at multiple locations spread out throughout the field.
5) In the case of aflatoxin, a black light test should be checked if it fluoresces.
6) A positive black light test does not prove the toxins are present with the aflatoxin.
Moldy corn is being reported in MN, but plant pathologist Dean Malvick says identify it before taking action. He says most of the problem is superficial growth on kernels, and it may stop growing once the corn is harvested and dried. He says the more severe molds inside the kernel may produce mycotoxins and that restricts the potential use of the corn. Read more.
Gibberella ear rot has reached levels not seen in IN for decades, say Purdue plant pathologists. And the presence of gibberella has lead to reports of high levels of the mycotoxin DON, or vomitoxin. That poses a concern if the grain becomes livestock feed. Gibberella also produces zearalenone which can lead to livestock infertility.
The Purdue specialists say corn growers should scout remaining fields of corn and take note of areas and hybrids with ear rot problems. If gibberella is present with its pinkish discoloration of kernels, contact your crop insurance agent before harvest for instructions on whether to harvest the field, or leave a strip of corn for adjusters to examine.
Test your corn before feeding it to livestock, or even putting it in livestock feeders, say Purdue livestock specialists, who are concerned about the presence of mold and toxins:
1) Pigs will reduce feed intake if DON levels are above 2 parts per million.
2) Pigs will have complete feed refusal if DON levels exceed 10 parts per million.
3) Poultry is not as sensitive as hogs to the toxins produced by gibberella molds.
4) DON or vomitoxin under 7.5 parts per mil. will suppress the immune system in poultry
5) Lower test weights from diplodia changes the germ and endosperm proportions in a kernel of corn, shifting amino acid and energy balances of the livestock ration.
Wet corn? Depending on moisture above 15%, drying time with natural air could take up to 27 days at 60ºF, 36 days at 50ºF, or 40 days at 40ºF, if the starting moisture was 21%. Consult this chart.
Wet beans? Depending on moisture above 13%, drying time with natural air could take up to 29 days at 60ºF, 38 days at 50ºF, or 42 days at 40ºF, if the starting moisture was 19%. Consult this chart.
Dry soybeans with caution, says Purdue grain quality specialist Matt Roberts, since high temperature drying of 160-180º can lead to excessive cracking of the seed coat. He says there will be less cracking and fewer splits if the humidity is above 40%. He says, “For example, if outside air is 60°F with a relative humidity of 80%, it should not be heated above 80°F because when heated to that temperature air relative humidity will be 40%.” Read more.
Medium temperature soybean drying can be accomplished if beans have high levels of moisture and the drying occurs in a continuous flow dryer or a drying bin. Roberts says if seed quality is not a concern, beans may be dried at 120-140º, but limit exposure to not more than a half hour depending on how high the original moisture level was. He says when heat is added to the bin, make it intermittent, to avoid extended exposure.
Low temperature soybean drying can be done with natural air drying, and Roberts says that will allow 2-3 points of moisture to be removed if ambient air temperatures are adequate and humidity is low. But he says this process may take several weeks. He says the process can be speeded up if one layer is dried before more beans are added to the bin, or if the bin is equipped with stirrers that thoroughly mix the beans during drying.
If your combine is creating ruts in wet soils, that is no surprise, say IA State specialists who estimate a loaded grain tank and a 12-row header put 18-20 tons of pressure on the front axle of a combine. But they say those ruts will interfere with your 2010 crop, particularly in getting proper seed depth, as well as crop rooting and development.
Ruts from heavy equipment on wet soil will not be erased with deep tillage, if the soil is still wet, since it will not properly shatter. They say it will take freezing and thawing action to loosen the soil. They recommend waiting until spring to make a light tillage pass, and then only work those areas of the field where ruts remain. If the 2010 growing season shows the impact of ruts, consider deep tillage after next year’s harvest.
New IRS regulations have lengthened the time for farmland estates to be settled. IA State ag law specialist Roger McEowen says in cases where environmental questions are unresolved, estates must remain open and assets cannot be distributed. He says those are new challenges for executors.
Hog prices are higher, but MO economists Glenn Grimes and Ron Plain wonder why. They report, “Slaughter in recent weeks has run 5-7% above mid-Aug. Therefore, these higher prices are not supply driven. The best guess is there is some improvement in exports since August and the increased spending on pork for October Pork month. Whatever the reason, it is appreciated.” But they warn, “The $70-plus summer 2010 futures for lean hogs may be influencing producers to slow or stop the decline in the breeding herd. The latest data show both sow and gilt slaughter below a year earlier.”
Improve your pasture productivity by increasing the livestock species that are grazing, says IL animal systems specialist Dean Oswald. Horses, cattle, goats, and sheep all graze at different heights and eat different plants. Therefore, rotating them all in the same pasture will allow better management of your forage, including weed control. Read more.
Managed grazing, says Oswald, allows several positive impacts for your forage:
1) Balance pressure on vegetation, protect natural resources, and reduce erosion.
2) Improve feed quality and quantity through proper forage management techniques.
3) Produce more pounds of livestock per acre, and diversify livestock sales.
Posted by Stu Ellis at 12:28 AM | Comments (1) | Permalink
October 29, 2009
Are You Planting Wheat, Or Filing For A Prevented Planting Insurance Payment?
“I haven’t planted wheat yet? Heck, I still have soybeans on my wheat ground!” And if you have either thought or uttered words to that effect, you may have totally forgotten about the crop insurance deadline for planting wheat. So let’s ease your mind a bit on that “minor” problem.
The crop insurance deadline for planting wheat across the northern part of the Cornbelt has already passed, and it will soon pass for wheat farmers across the southern part of the Cornbelt. And there is a good chance you have not only been unable to plant wheat, but probably your wheat ground may still have 2009 crops on them and certainly your seedbed is not yet ready. Mother Nature is not yet done watering it for you. So, if you have not met the planting date requirements for sowing wheat and you had planned to insure it with a revenue insurance policy, there are some alternatives says University of Illinois Farm Management Specialist Gary Schnitkey.
“Reaching the final planting date does not mean that wheat cannot be planted. Rather, guarantees will be reduced once the final planting date is reached. In addition, a farmer can choose to take a prevented planting payment and not plant wheat once the final planting date has been reached.” In a nutshell, that is Schnitkey’s message for those who are most concerned.
Delayed planting penalty
When your final planting date has arrived, and you have not yet planted wheat, there is a five day late planting period, in which the revenue guarantee drops 1% per day. However, that only gives you five days with a relatively small penalty, but if the sixth day arrives and the wheat is not planted, then the guarantee drops to 60% of your expected revenue, whether that is the initial or final guarantee, depending on the type of revenue insurance policy you have.
Prevented planting payment
If you have been unable to plant wheat because of the weather, or any other insurable cause, then you have the option to receive a prevented planting payment. Schnitkey says before the crop insurance company issues a prevented planting payment, it will have to be assured that your fields were too wet, and the reason was not the fact the field was full of uncut soybeans. A prevented planting claim must be filed within 72 hours of the final date for late planting, as well as including a report on the problem and the acreage involved. If you plant a spring crop, your prevented planting payment for wheat will be 35% of your guarantee, but a full payment would be issued if no spring crop is planted on the wheat acreage.
Strategy and considerations
Schnitkey says planting a second crop next spring will impact your APH yield for wheat, and it will be recorded as 60% of your APH yield. That will reduce your APH average in future years. However, yields may also be pulled down with late planted wheat.
Schnitkey also says most farmers will find a prevented planting payment advantageous. He says the size of it will outweigh the negatives of a decline in APH yields and the fact a spring crop may not be eligible for crop insurance coverage.
Summary:
Wheat growers are at the point of having to make decisions on what to do about crop insurance coverage if late harvest of row crops has prevented timely planting of wheat. The deadline is here for filing for prevented planting payments, if wheat ground remains too wet to plant. While there are minor deductions of benefits for the first five days after the deadline, the benefit drops to 60%. However, a prevented planting payment may be preferred over late planting benefits.
Posted by Stu Ellis at 12:11 AM | Comments (0) | Permalink
October 28, 2009
Will There Be Enough Corn?
With growing questions about the potential deterioration of the late crop, there are corresponding questions whether corn supplies will be ample enough to meet all of the estimated needs. Currently, USDA is projecting 4.2 billion bushels will be refined into ethanol during the new marketing year. That will put pressure on livestock producers, exporters, and may even raise corn prices paid by the ethanol industry. What is that delicate balance that must met between supply and demand?
Currently, USDA is projecting a 13.018 billion bushel corn crop as calculated in the October Crop Report. Ag economists Daniel O’Brien and Mike Woolverton at Kansas State University report that level of production with the old crop carryover would supply just over 14.7 billion bushels, a volume that would be the largest supply on record. But they are not certain that amount of corn is really available because of the threats to the new crop. They say both quality and quantity are called into question due to crop immaturity when cold weather halted growth and the damage to the crop from 2009 weather issues. They speculate that unless damage or harvest delays are extreme, the corn crop should be at near record levels.
O’Brien and Wooverton have been tracking corn use by ethanol refiners for several years. They say the 2007-2008 marketing year shipped 3.049 billion bushels of corn to ethanol plants. During the 2008-2009 marketing year that volume climbed to 3.700 billion, and now it is forecast at 4.2 billion for the current marketing year. They say livestock feed has been the dominant use of corn for the past 35 years, but those prospects have moderated because of the economic struggle in the livestock industry to balance meat supply and demand.
On the periphery is the export trade, which is quite variable, and has been since 1973. The US is currently supplying over 60% of the world’s corn needs, but demand fluctuates annually and exports have been a “wild card” at the margin, say the economists. With US and global corn crops enlarging each year, there is not always going to be a significant global need for US corn. On the other hand, ethanol use has jumped from 24% to 32% of total demand in the last three years, and even other industrial uses of corn have steadily increased.
The Kansas State researchers compared corn ending stocks with the total use and found, “total use of U.S. corn over time has been relatively more stable than has ending stocks. Also, ending stocks-to-use ratios are typically used measure of the relative scarcity of corn supplies in comparison to use, and generally been inversely related to corn market price levels over time (i.e., high ending stocks-to-use ratios have been associated with lower corn prices, and vice verse).”
O’Brien and Woolverton believe there to be an adequate supply of corn available to meet the ethanol demand in the current marketing year, but that higher export demand will be complemented by lower feed demand. But over the coming 10 years, the prospects may be different. They say USDA economists are pushing ethanol demand to 5.05 billion bushels by 2018-2019 and that assumes a steady upward production trend, with feed use climbing to 5.850 billion and exports to 2.225 billion bushels.
The Kansas State economists contend if exports grow more than anticipated then corn ending stocks will be seriously affected, even with exports growing only 5% to 10% more than expected. Such a growth rate in the current marketing year would push stocks to use from nearly 13% down to 4%. And they say the result would be high US corn prices.
Summary:
As ethanol consumption of corn rapidly grows, there will be challenges to supply enough corn if there are moderate growth rates for other uses of corn. “However, the critical issue is that in the long run the availability of supplies of corn for ethanol production are directly dependent on developments in other segments of both the corn supply – demand complex. In turn, these other sources of corn use are dependent on the broader set of domestic and foreign economic influences affecting the agricultural markets in general.”
Posted by Stu Ellis at 12:22 AM | Comments (0) | Permalink
October 27, 2009
Update Your Marketing Plan For Corn And Beans
Sell or store? While fussing with the weather and drying what little corn and beans have been harvested, there is ample time to update your marketing plan. Do you store, and if so, what price will pull it out of the bin. Or do you unload your grain now to take advantage of current harvest premiums for corn as well as beans at the top of the USDA price range? To help make those decisions, let’s explore the current market dynamics.
One of the most significant market dynamics is the delay in getting crops harvested. Futures prices have frequently responded to those delays and basis levels have improved as a direct result says IL marketing specialist Darrel Good in his weekly newsletter. But he agrees with you that continued delays could translate into lower yields from crop deterioration and harvest losses.
Good says prices will be a function of demand for corn and beans and the market is currently trying to determine the extent of that demand. Important elements of that will be the speed, timing, and extent of the economic recovery here and abroad. He says when consumers have more money to spend the meat market will recover and that will imply the need for more feed. And he adds that stronger energy prices will pull ethanol higher, but commodity prices will soften if those events do not materialize.
Dynamics in the soybean market are lead by the pace of exports, which are well ahead of the 2009 record year. China is responsible for the increased business, but as South American production becomes available, the market will watch for US exports to slow. Domestic use of soybeans is at a low ebb, both in crush and consumption. While stocks are ample, the inventories at processing plants means some demand weakness.
Dynamics in the corn market have been helped by a robust economy for ethanol refiners with reasonable returns from higher oil prices and moderate corn prices. Corn exports are on pace with last year, which declined from prior years, although the USDA target is 2.15 bil. bu. Feed use of corn will be known when the December Grain Stocks report is released in early January. However, demand is known to be weak because of low livestock prices, declining livestock numbers, and increased production of distillers’ grains.
Darrel Good says there will still be price uncertainty in weeks to come, but the past several weeks of higher prices have allowed some flexibility to be aggressive in marketing at harvest time. That uncertainty is also identified by MO marketing specialist Melvin Brees in his latest marketing newsletter. But Brees believes there is a significant potential in a lower corn crop than what is currently being forecast. He cites the sluggish harvest rate but also the fact that freezing temperatures halted maturity for one-third of the corn crop, and that will result in lower test weights and poor stalk quality. The stronger market prices, which Brees calls a “counter-seasonal price rally” have been at work in both the corn and bean markets, particularly tightening up the soybean basis. Brees is not one to ignore current cash bids, saying many of them are in the upper range of the USDA’s estimated prices for the year.
The corn market still signals storage to Brees because of the nearly 20 cent spread from December to May futures. And he says when that is coupled with the expected tightening of the basis, there would be a return to storage that would be profitable. However, he warns that prices must be booked, and any unpriced corn going into storage is at risk for a decline in value if the crop remains as large as is now forecast and harvest progress picks up.
Brees says there are even profits to be made in cash sales at some locations paying nearly $4 per bushel. And he says it would be risky to hold onto the crop awaiting some definitive market signal that has indicated prices have topped. He suggests stored corn should be booked for spring delivery to lock in profitable prices and if the basis weakens as harvest progresses, Brees says a hedge to arrive contract would protect the futures portion of the price while awaiting post harvest basis improvement.
The bean market still signals sales rather than storage because there is only a 7 cent carry in the futures market from November to March, which will not pay for either commercial or on-farm storage. He says soybean storage is a speculative process of hoping prices rise above the USDA’s forecast price range. While he advocates a cash sale, he says at least lock in the strong basis with a basis contract if you believe the futures market will rise. While the market carry has increased from September, Brees interprets that as a signal that demand is beginning to weaken with the advent of the South American crop. He is opposed to carrying unpriced soybeans into the spring, and says anyone wanting to speculate in that direction should use either the futures market or call options, both of which still carry significant risks.
Summary:
The slow pace of harvest and uncertainties about crop size have provided counter-seasonal strength to corn and bean prices, along with other market dynamics. Strong ethanol demand, but moderate feed and export demand mark the corn market, which is telling farmers to store with a 20 cent carry through May 2010. Tight supplies, a strong export demand, and weaker domestic demand for soybeans are telling farmers not to store beans priced or unpriced.
Posted by Stu Ellis at 12:14 AM | Comments (1) | Permalink
October 26, 2009
Answers For Your Fall Fertility Questions
Some Cornbelt cornfields received the full complement of nitrogen this year, others may not have received any. And some farmers who normally apply one form of nitrogen, may have been forced by the weather and soil conditions to turn to one or more alternatives. While experimentation is always good, forced experimentation is not pleasant, and some of your yield may have been lost because of weather interruption of your fertility program. So what do you do this fall, given a late harvest, potentially wet soils, and a narrow window of application?
To begin on a positive note, you’ll be paying considerably less for nitrogen this fall than you did last year. High-fives everyone! Now, back to reality.
Nitrogen application this year is like any year; hold back until temperatures are below 50ºF, or apply it below 60ºF with the help of an inhibitor to ensure against nitrification. That is one of the primary messages from IL fertility specialist Fabian Fernandez in a recent newsletter. He says some forms of N are more susceptible to loss than others, and ammonium can either stay in colder soils, or be converted to a nitrate by soil organisms active in warmer soils. Even if applied properly in the fall, do not apply N if there is a potential for early spring leaching as sandy soils warm up prior to planting. He recommends getting a soil thermometer and taking regular readings at the 4 inch levels at the warmest part of the day.
Anhydrous ammonia is the preferred source of N because it will quickly react with soil moisture and remain in the ammonium form, either with the help of products such as N-Serve, or because cool soil temperatures retard bacterial activity. Fernandez reminds farmers to avoid volatilization loss by ensuring the soil closes behind the applicator knife and the ammonia is inserted deep enough to ensure the ammonia gas does not escape.
The stability of anhydrous ammonia is not present with other forms of N which are in nitrate form, such as ammonium nitrate or urea ammonium nitrate (UAN). Since they are nitrates, they are more susceptible to leaching and environmental loss and should not be applied in the fall. Fernandez says the lower efficiency of urea is due to the greater risk of nitrate loss before the corn is ready to use it.
Urea that is coated with polymer, which is also known as slow release or PCU are designed to retard that loss of nitrate. Fernandez says the jury is still out on the success of the product when used in the fall. At issue is the thickness of the polymer coating, its integrity, and handling issues, all of which are important for stability, but then you also want it to degrade at the right time so the corn can use the nitrogen.
There has been some renewed interest in the use of manure, poultry litter, and other organic fertilizers to provide N, as well as P & K. Fernandez says their application should be incorporated to avoid loss by volatilization. He says the N will be in an ammonium form that will quickly convert to a nitrate and be loss to leaching if soil temperatures are warm enough. But he says don’t apply manure to frozen soils, either, and be careful against an overapplication of phosphorus. That means, have your soil test results handy, and know the analysis of the manure.
So, how much do you apply? Just because it is cheaper this year does not mean you should apply more than last year. Use the N rate calculator to determine the rate that will return the most profit per pound of N. Since the calculator does not account for any carryover N, think about how much may already be in the soil. High yields will have taken out more. Low yields will have taken out less, but in the case of the latter, the wet 2009 spring may have consumed N before the crop began growing, so there may not be any excess. But remember, it is not necessary to make your entire N application before winter sets in.
And when do you apply it? Fernandez says the best time to apply N is in the spring when the corn needs it and there is little chance for it to leach or denitrify. He says if a full rate pre-plant application is not an option, apply a portion this fall, and the balance as a side dress application. You may, (or may not) have more time in the fall to apply nitrogen, and sometimes there are price considerations.
Summary:
Wait until soil temperatures at the 4-inch depth are below 50°F, or below 60°F if you are using a nitrification inhibitor. Do not apply N, or N with a nitrification inhibitor, if soils are prone to leaching. Use a nitrification inhibitor with anhydrous ammonia applications. Do not apply urea or nitrate-containing fertilizers in the fall. If using animal manure, make sure it is incorporated into the soil, and follow the time of application guidelines discussed for commercial N management. Apply the appropriate rate, taking into account leftover N when applicable, and consider applying only a portion of the total N needed in the fall and the rest in the spring. Consider the risks and benefits of fall N application. If fall application is appropriate, follow the recommendations here to help increase the efficiency.
Posted by Stu Ellis at 10:10 AM | Comments (0) | Permalink
October 23, 2009
Cornbelt Update
Cornbelt 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.
Mark mid-November on your calendar. That is when MI State grain marketing specialist Jim Hilker says the size of the 2009 crop may be known. He says the October USDA report was based on Oct. 1 conditions, but a lot of crop damage happened after then. “The November 1 USDA crop production survey, to be released November 10 will give us a good update, but I suspect a lot of this corn will have to be harvested before we really know the condition.” Read more.
Hilker believes the crop estimate will decline when released in November, “For those that have to deliver at harvest, consider taking some of these prices even before delivery, and don't plan on paying commercial storage, the market is still saying it will not pay. Consider a basis contract if you want to stay in the market. For those with on-farm storage, the market is saying it will pay for using it. Your decision is: do you just wait to price, or lock in some of it now, i.e., hedge or H-T-A. You could do some of both, especially if corn prices have stayed the same or continued to go up after October 20.
The soybean crop estimate will also drop, thinks Hilker, because of crop damage. But he says the market will still not pay you to store beans, “While a few may be able to take advantage of some basis tightening right after harvest, everybody ought to be considering basis contracts, where you delivery the beans and get 80% of the price to start, or sell cash and buy futures if you want to stay in the market for the longer haul.”
Hilker’s bearishness on beans is due to South American production. He says Argentine production will be up 64% after the spring 2009 drought and Brazilian production up 9%; “And this is on top of US production expected to be up 9% this year. So play the market at your own risk, it may be that selling some $9.50 soybeans at harvest turns out to be pretty good. Or South American soybean production could bomb out.”
Wheat producers, says MI State’s Jim Hilker, have two problems if their 2009 crop remains stored and unpriced. He says, “The very low market price says the market doesn't want your wheat. And the spreads in the futures contract prices says the market does not want to pay commercial storage. The market says it will pay on-farm stored wheat about the net return of corn through March. But if you have on-farm storage space, greater than your need for corn, consider keeping your on-farm stored wheat.”
Wet harvests are costly. Costs may reach $100 per acre for drying and shrink says IL Farm Management Specialist Gary Schnitkey due to high moisture levels in corn. He is concerned that your 2009 farm budget did not include that expense. Read his newsletter.
Your 190 bu. yield coming out of the field at 25% moisture may be 216 bu. in the truck but you are only selling 186 bu. at 15% moisture when 1.4% shrink is applied. The shrink loss of $15, plus $76 drying cost per acre mean a $91 revenue loss per acre.
Waiting for Mother Nature to dry your corn, will save money, but many farmers are reporting their corn is drying too slowly or not at all when left in the field. Schnitkey says field drying from 32% moisture down to 31% will save $13 per acre in drying costs. But he says consider the potential for field losses if corn remains standing.
Call several elevators and ask about their policies and calculations for drying and shrink. Schnitkey says you may find several variations, some of which may be more appealing than your nearby elevator, particularly if the corn is to be sold or stored. And he says some elevators base drying charges on wet bushels and others on dry bushels.
Immature corn will have trouble drying down, says ND ag engineer Ken Hellevang, and it will have low test weights and potential ear molds. He says the only way to stop those is either drying or ensiling. Hellvang has a newsletter with several grain drying tips.
Drying #1. Standing corn will only dry 0.6 to 0.9 percentage points per day, even with a warm temperature and a dry breeze, but that rate quickly declines with the calendar. Field drying is more economical until mid to late October and mechanical high temperature drying is more economical after that point says Hellevang.
Drying #2. Corn above 21 percent moisture should not be dried using natural air and low-temperature drying to minimize corn spoilage during drying. Hellevang recommends an airflow rate of 1.25 cubic feet per minute per bushel (cfm/bu) to reduce drying time. Adding heat does not permit drying wetter corn and only slightly increases drying speed.
Drying #3. Shelled corn can be stored in a grain bin at moisture contents up to about 25 percent if it is kept below 30 degrees using aeration. Corn kernels above about 25 percent moisture may freeze into a clump that causes unloading problems.
Drying #4. Use the maximum allowable drying temperature in a high-temperature dryer to increase dryer capacity and energy efficiency. Be aware that high drying temperatures result in a lower final test weight and increased breakage susceptibility in the corn.
Drying #5. Dryeration will increase the dryer capacity about 50 percent to 75 percent, reduce energy used by about 25 percent and remove about 2 to 2.5 points of moisture (0.25 percent for each 10 degrees the corn is cooled). Hellevang says with dryeration, hot corn from the dryer is placed in a dryeration bin with a perforated floor, allowed to steep for four to six hours without airflow, cooled and then moved to a storage bin.
Drying #6. Using the maximum drying temperature that will not damage the corn also can reduce energy consumption. The amount of energy required to remove a pound of water is about 20 percent less using a drying air temperature of 200 F than 150 F.
Drying #7. The estimated quantity of propane needed to dry is 0.02 gallon per bushel per point of moisture removed. Propane will cost about $53 to remove 10 percentage points of moisture from 120 bushels of corn using $2 propane.
1974 may have been the last time that diplodia, giberella, and other corn fungal rots were seen to this extent, says Purdue ag engineer Richard Stroshine. He says farmers are going to have to take extra precaution in storing and drying down grain this year. He says if your corn is moldy, remove as much of the broken kernels and fines as possible before storage, then dry it to 14% moisture and don’t expect it to store as well as usual.
You have a field of moldy corn. Do you blend it with good corn when putting it in the bin? Not now, says Stroshine, “Farmers may want to mix their corn with high levels of mold with their good corn, but my recommendation would be to segregate the good corn from the bad. It should be handled separately. Then if need be, it can be blended later."
Within fields, significant variation in grain moisture may exist among plants that died prematurely and those that matured more normally, say OH State agronomists. “In such fields, growers should be prepared for stalk lodging problems (associated with drought stress) that may slow harvest and contribute to yield losses. The loss of one "normal" sized ear per 100 feet of row translates into a loss of more than one bushel/acre.”
What is your soybean component content? IA State soybean agronomist Palle Pedersen says the September heat pushed soybeans to maturity, without completing pod fill. As a result protein values are a low 31-34%, and oil content is above average at 19+%. High protein meals will be 45-47%, but essential amino acids will not decline as much as protein, so the beanmeal will be potentially good for swine and poultry nutrition.
Soybeans that were frost damaged will have less extractable oil, and it will carry a green color, which must be removed with a high cost bleaching process. But for farmers green soybeans will carry pod pieces with them which are hard to separate. In the bin green or immature soybeans will spoil faster and the oil becomes rancid and value drops.
The late and immature beans will likely be wet, says IA State grain quality specialist Charles Hurburgh. He says, “Soybeans dry more easily than corn so air alone, or heat no more than 120F will be adequate. Monitor drying frequently to prevent overdrying. And he adds, wet soybeans should not be held in bunkers, piles, flat storages, sheds or other structures where airflow is not well distributed. Read his and Pedersen’s newsletter.
If you are frustrated over frost-damaged beans, Hurburgh says, “The best strategy is to aerate and store for 40-60 days before selling. The greenness may subside enough to be below the color threshold of the Grades. In cases of dispute over grading, submit the sample to a USDA licensed grading agency for resolution. Protein levels are likely to be below average; oil levels above average in Iowa soybeans.”
Your haste to harvest may have caused you to operate in fields with wet soils, and that may result in compaction with yield loss in future years. You may view that as the lesser of the evils, but there are some measures you can take to minimize compaction damage.
1) Restrict heavy equipment or truck traffic in fields to specific tracks or lanes.
2) Drive grain carts in prior combine tracks and avoid diagonal field crossings.
3) Keep trucks on the road, if possible, but if not, restrict them to the end rows.
4) Compaction is only reversed by wetting and drying, freezing and thawing over time.
If liming is on your to-do list, ensure that you are applying the correct amount. Two soils, both with a 5.5 pH, may need two different amounts of lime says IL agronomist Matt Montgomery. He says it all depends on whether the hydrogen ions are floating or attached to soil particles, and if floating, the soil may need twice as much lime. Consult with a fertility supplier or Extension specialist and ask about the Cation Exchange.
It’s pretty, but you probably would rather enjoy your spring without a healthy crop of butterweed in your fields. IL weed specialist Aaron Hager says it will soon be emerging in your fields, particularly no-till fields, and his herbicide performance chart says fall applications do better.
Adverse harvest weather has been adverse to cow-calf producers says UT State livestock economist Dillon Feuz, “The result has been the corn price has increased about $0.50 per bu. That certainly has pressured feeder cattle prices lower. The other on-going and worsening situation is there continues to be no money in feeding cattle. While it appeared back in the spring that feedlots were poised to finally start making a little money feeding cattle, that hope disappeared through the summer and early fall.”
Feuz has a stern warning to cow-calf producers about their relationship with feedlots, some of which have become bankrupt. He says, “Certainly, those who remain in business have limited ability to bid up feeder cattle prices. While cow-calf producers never want to sell their calves too cheap to feedlots, they may actually want to this year, or there may be no feedlots left to buy their calves next year.”
What is the most economical feed for your livestock? (And don’t forget to factor in the moisture content of the corn or distillers’ grain). At that point it just got complicated, so you need the “Cost of Feedstuffs Calculator.” Find and download the calculator. The feedstuffs library includes 120 different feedstuffs comprising: 22 company co-products; 25 by-products; 5 new generation co-products; 27 forages; 11 grains; 9 crop residues; 12 silages; and 9 supplements. And you can include your own farm-produced feeds.
USDA’s price estimates of a $3.30 average price for 2009 corn and $275 per ton for soybean meal will help livestock producers say MO livestock economists Glenn Grimes and Ron Plain. But they say the resulting $3-4 per cwt reduction in production cost is not enough to erase the red ink of the past year. They say the breeding herd needs to be cut substantially more than what the September 1 Hogs and Pigs Report projected.
Posted by Stu Ellis at 12:55 AM | Comments (0) | Permalink
October 22, 2009
If You Did Not Sign-up For ACRE, You Were Not Alone!
Did you enroll your farm in the ACRE program for the 2009 crop year? Do you know anyone, or anyone else, who signed up for ACRE? According to the preliminary statistics released by USDA’s Farm Service Agency, FSA offices were not doing “land office” business just before the August 14th deadline.
The Average Crop Revenue Election (ACRE) program was created in the 2008 Farm Bill to help farm owners and operators manage revenue risk and move away from subsidies based entirely on production. The ACRE program was not a guaranteed payment, since revenue loss thresholds, based on price and yield, had to be reached at both the state level and the farm level. Despite the extended sign-up period for ACRE, only 7.7% of eligible farms signed up and they accounted for only 13% of eligible program crop acres.
USDA’s announcement of the enrollment provided little surprise about the location of those signing up for the program. “Of the 22 different crops eligible for enrollment, corn had the highest number of base acres enrolled, followed by wheat and soybeans, and producers mainly planted these three crops. The states with the largest number of base acres enrolled are Illinois, Nebraska, Iowa, South Dakota and North Dakota.” Nationwide, 128,620 farms will be in the program.
Around the Cornbelt, that includes:
IL: 16.71% of farms, 22.98% of base acres
IN: 9.49% of farms, 15.46% of base acres
IA: 11.81% of farms, 16.34% of base acres
KS: 1.61% of farms, 2.82% of base acres
MI: 6.52% of farms, 12.55% of base acres
MN: 6.14% of farms, 10.02% of base acres
MO: 4.39% of farms, 8.07% of base acres
NE: 19.61% of farms, 24.82% of base acres
ND: 10.03% of farms, 15.45% of base acres
OH: 6.28% of farms, 10% of base acres
SD: 18.36% of farms, 26.34% of base acres
WI: 3.46% of farms, 7.16% of base acres
During the weeks and months prior to the sign-up period, nearly all farm management specialists and agricultural economists at Cornbelt Land Grant Universities strongly encouraged farmers to sign up for the program. Many of them who personally owned farmland publically indicated they had enrolled their farmland into the ACRE program. However, many farmers did not follow their lead, and were reluctant to step into the new farm program.
Was farmer reluctance to enroll in the program based on:
1) The complexity of the ACRE formula that would determine a payment?
2) The requirement for a four year commitment to the program without being able to opt out?
3) Revenue-based crop insurance being a better risk management tool?
4) Difficulty in getting absentee land owners to understand and buy into the program?
5) Not getting a payment from the program until 14 months after sign-up?
6) Lack of acceptable records to prove yields?
Your thoughts are welcome and encouraged. Enter your opinion, and do not worry about being identified.
Summary:
Initial results of the enrollment in the ACRE program have been released by USDA, and less than 8% of farms and less than 13% of eligible acreage was enrolled prior to the August 14 deadline. Cornbelt participation varied widely from nearly 20% of Nebraska farms to less than 2% of Kansas farms. The largest acreage enrolled came from IL, IA, NE, and the Dakotas. Farmer reluctance to participate could be rooted in a wide variety of concerns.
Posted by Stu Ellis at 12:04 AM | Comments (1) | Permalink
October 21, 2009
A Profit Opportunity For Cowboys? Really!
Is there a turnaround occurring in the cattle market? Apparently, cowboys see some opportunities for profitability and their recent actions to increase feedlot inventories indicate a light at the end of the tunnel for the beef industry. Is that a glimmer of hope or is that an approaching train wreck?
Last Friday’s Cattle on Feed report indicated September feedlot placements were up 5% while marketings were down 4%. The difference shows a 1% increase in the feedlot inventory. Looking back at history, that is the first month in the past 16 that inventories have increased. They have all decreased since the spring of 2008. With the reports of a good corn crop and adequate supplies of feed, cattle feeders apparently see the potential for profits next summer.
At Iowa State, livestock economist John Lawrence puts it in terms of a “crush margin” and says that is the return remaining after accounting for the feeder steer and corn that is used to cover the other more constant expenses. His crush margin for feeder steers put on feed now and sold in March provide a crush margin of $178. That increases to $219 for November placements marketed in April, and $204 for December placements marketed in May. While his calculations decline, the crush margin remains between $100 and $160 for the next 12 months.
At Purdue, livestock economist Chris Hurt says he sees “a host of economic indicators suggest the recession has ended and the economy has more positive signs than negative.” In his latest newsletter Hurt lists those indicators as “the rise in the average length of work week, rising building permits, falling numbers of new claims for unemployment, and of course the rising stock market.” While he thinks inflationary investing has underpriced cattle, he says the fundamentals are positive for the beef industry.
Hurt saw the same numbers as Lawrence and projects a rise for Nebraska finished steers through the end of this year with cattle moving into the mid to higher $80s early next year. He does not expect the typical summer softening of the market and says summer 2010 should bring prices in the low to mid $90 range.
Hurt looked back on the impact of the recession, which took cattle prices from an average of $92 in 2008 to $83 this year. With a $10 climb anticipated, Hurt says cattle producers can “ride the recovery” as the US climbs out of the recession. But he is quick to suggest the need to grab a strong hold on reality and manage your potential risks. He says the recovery could be an anemic recovery, or there may be a second recessionary dip.
Hurt suggests cow-calf operators “stay long cattle at least for now.” He says retain ownership of calves for a longer period and consider feeding them out rather than selling them this fall. For feedlot operators, Hurt suggests, “waiting a bit to forward price the finished cattle in order to give inflation investors a little time to locate the cattle futures trading pit.”
Summary:
The beef industry is beginning to see the opportunity for an economic recovery with higher cattle prices in the coming year and changes in the cattle inventory. Feedlot placements are up more than marketings, and there is more money to be made with cattle placed in feedlots in the next several months than any time in the past 16 months. Livestock economists suggest that risks be managed to avoid unseen economic challenges, but they may be able to benefit from the recovery of the US economy.
Posted by Stu Ellis at 12:09 AM | Comments (0) | Permalink
October 20, 2009
So, Your Test Weight Is Light Along With Your Check!
You pull onto the scales at the local elevator, a probe takes a sample and you head to the corn dump pit to unload. While you are anxious to return to the field for another load, the elevator office staff records the moisture and grades your corn with a light test weight, which is less than the 54 lbs per bushel for #2 yellow corn. You knew you had some diplodia fungus in the field, and its damage to the kernels just pulled the profitability rug out from under your corn crop. Why is test weight so important?
Purdue’s Corn King, agronomist Bob Nielsen, says test weight is one of the 10 favorite discussion topics anytime farmers gather with a coffee mug in their hand, particularly on a rainy day during harvest season. His comments on test weight will help many producers understand the significance of what the grain elevator staff is trying to determine when it weighs and measures a sample of your corn.
The definition of #2 yellow corn requires that a volumetric bushel be 54 lbs. in weight. The 56 lbs that most farmers cite is for #1 yellow corn, which is the grade that usually originates on a Cornbelt farm in the fall. And Nielsen adds that US corn is marketed on the basis of a 56 lb. bushel regardless of test weight. Of course the elevator need not take an entire bushel to weigh, but will take a smaller sample that will be measured by its electronic moisture tester. Nielsen says, “These test weight estimates are reasonably accurate but are not accepted for official grain trading purposes.” While US grain standards include test weight, the moisture content has been removed, however the standard dry bushel cannot have moisture more than 15.5% or the buyer will impose a discount.
Test weight may be on the ticket, but it will show up primarily on the settlement sheet, because payment will be on the basis of 56 lb. corn. If kernel damage from diplodia or any other problem reduces the test weight, that 1,000 bushel truckload of corn quickly became 929 bushels of corn, since the test weight was 52 lbs. per bushel and not 56. Regardless of the volume of grain in the truck, its net weight will be divided by 56 lbs. for sale purposes. If your corn was more dense than the 56 lb. bushel standard, and a volumetric bushel weighed 60 lbs. then you would be paid for 1071 bushels, although the load was only 1,000 bushels by volume.
The density of the kernel is a function of many factors, one of which is the hybrid, but yield does not appear on that list of factors. And one hybrid can have one test weight in one field and a different test weight in another field. And it will vary from year to year as well, but its yield will not correlate with test weight, says Neilsen.
The test weight is an important factor for processors, since they will benefit from high test weight corn and their starch or oil output will be less efficient from a low test weigh corn. At least that is the conventional wisdom, whether or not research supports it, says Neilsen. One significant factor is that the quality of the lower test weight corn may be due to other factors that caused the reduction in test weight.
So, why did your corn this year have a low test weight? Neilsen says there were six potential causes of lower test weights for 2009 corn.
1) The wetter the corn, the lower the test weight. Corn weighs more than water, so dry corn weighs more than wet corn, and as corn dried in the field or the dryer it shrank, and picked up weight allowing more kernels to squeeze into that bushel volume. Therefore, when your wetter corn was tested at the scale house, it was destined to have a lower test weight.
2) Drought stress in a few spots around the Cornbelt this year.
3) Gray leaf spot and northern corn leaf blight.
4) Cooler than normal September temperatures that interfered with starch production in the kernel.
5) The early October freeze and frost which damaged immature kernels and halted the grain filling process.
6) Widespread damage from diplodia and other fungal ear rots, which deteriorated the quality of the kernel content desired by ethanol refiners, cattle feeders, and other end users.
Summary:
Test weight is an indicator of the density of the corn kernel and low test weights for many truckloads of corn in 2009 have resulted in farmers being paid less than they expected when delivering a truckload of corn. The same volume that may have measured 1,000 bushels in 2008 may have only measured 925 bushels in 2009 because of environmental factors that interfered with kernel development. Those may have included fungal issues, the early frost damage on immature corn, and the fact that wetter corn was being delivered, since wetter corn weighs less than dry corn.
Posted by Stu Ellis at 12:29 AM | Comments (0) | Permalink
October 19, 2009
Manage Your Crop Carefully As It Entered Storage.
The challenges of the growing season have certainly returned in the form of challenges to the harvest season. Delayed crop maturity; narrow harvest windows; and long lines at elevators which close in the afternoon to dry down the grain they receive in the morning. Farm-stored grain will be a challenge for many producers to keep it in condition, particularly with a heavy dose of mold present in the field, and light test weights due to a pre-mature termination of the growing season. Grain storage management will be a priority for nearly every farmer this fall.
There will be a solution to the issues, and that is the checks that are written for propane and electricity at your bin site. While those are not user friendly, there will be few alternatives according to grain management specialist Charles Hurburgh at Iowa State University. In a recent newsletter he says, “This would not be a good year to take chances that wetter corn will keep and can be absorbed in the spring/summer.” Hurburgh, an ag engineer, and agronomist Roger Elmore urge farmers to consider the shelf life of the grain, which is a function of the moisture and temperature of the grain. Their chart of maximum shelf life ranges from 150 month shelf life for corn at 13% moisture and 40ºF temperature to a 27 day shelf life for corn that is 18% moisture and has a storage temperature of 80ºF. If you have corn at that temperature and 24% moisture, it may go out of condition while you are eating lunch.
Hurburgh says temperature can be held constant with aeration, and unaerated grain will shorten its own shelf life as it gives off heat and moisture as it spoils. Corn with lower tests weights, such as that which has been impacted by diplodia or other fungi, will spoil about twice as fast as corn with higher test weights. And Hurburgh says shelf life will be used up the longer the corn is held in the bin at high moisture before being dried. He says the shelf life of grain will be determined by everything that is done to the grain from the point of harvest.
• Fines and cracked kernels will spoil faster, so check combine settings.
• Grain that starts to heat has used up its shelf life.
• Cool grain quickly and minimize variations between the field and the dryer.
• Aerate wet corn immediately, since overnight storage in a truck can impact the shelf life.
Three phases of aeration are recommended by Hurburgh:
1) Lower temperature by steps: low 40’s in Oct., high 30’s in Nov., and 28-35º in Dec.
2) Maintain temperature with intermittent aeration, 28-35º in Jan. & Feb.
3) Keep grain cold in the spring, seal fans, and ventilate headspace intermittently.
4) Do not store wet corn in bunkers or flat storage where airflow is restricted.
If your harvest progress exceeds your ability to haul corn to the elevator, Hurburgh suggests a phased approach to drying, despite the extra labor involved. He says dry to 17-19% moisture, then finish your drying after harvest is complete. If you are storing for any length of time, keep the corn with the heaviest test weight for the longer haul, and move your lighter test weight corn out as soon as possible. Hurburgh reminds farmers to not mix corn from two harvests because the old crop may have mold that will spread with the help of the warmer and wetter new crop. He also recommends removal of the center core and use a temperature probe every two weeks.
Summary:
Grain storage will be a significant challenge, because of the potential for mold in the harvested grain, and the fact that short harvest windows are forcing a lot of wet grain to be harvested and put into the bin. Grain needs to be aerated and temperature gradually reduced over the next two months to bring the grain temperature down to where it can be held into the spring without spoilage. Wet grain needs to be dried, but with high moisture grain being harvested, a two phase approach may allow some initial drying to retard spoilage, with final drying after harvest is complete.
Posted by Stu Ellis at 12:00 AM | Comments (1) | Permalink
October 16, 2009
Cornbelt Update
Cornbelt 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.
USDA’s corn yield forecast is on track with growing season weather and crop condition ratings says IL marketing specialist Darrel Good. But he says the USDA forecast bean yield is a bit below the crop condition ratings and his estimates based on growing season weather. He says typically, yield forecasts increase in Nov., but 2009 is not a typical year. Read more.
2009 is not typical, says Good, because the growing season for late maturing crops was ended early by freezing temperature. He says that may have reduced yield, along with widespread incidents of disease in both corn and beans, causing quality issues. Good believes that USDA’s November crop report may very well show a decline in yields.
Darrel Good says corn prices have climbed 65¢ and beans have risen over $1.00 per bushel while USDA has continued to push upward its crop estimates. That is because of strong demand. He says the ethanol industry has recovered substantially, and there are higher estimates for corn being used for livestock feed than in earlier estimates.
Darrel Good says soybean prices have been held up by the strength of exports, which are now at a predicted record of 1.305 bil. bu. for the new marketing year. Currently, exports and unshipped commitments are at 758 mil. bu., up 350 mil. bu. from last year.
If you are concerned about pricing, Good says the crop size and quality concerns will keep corn and bean prices strong. He suggests that higher prices should lead producers toward pricing strategies that have less storage and more harvest time pricing.
Looking back at the USDA World Supply-Demand Report, KS marketing specialist Mike Woolverton says the estimate for Chinese corn production was cut by 200 mil. bu., and global corn stocks were also lowered. He concludes that lower global stocks could put upward pressure on US corn prices, and China may be in the market for corn.
Woolverton found nothing to be bullish about in the wheat market. He says US stocks are at a 9 year high after raising production and lowering use. Exports will be down because of competition from Russia, Canada, and Australia. He says despite global production being down 2% this year, global stocks will be up 12% this year. He is hoping wheat prices will follow corn and bean prices higher during the year.
If you are putting price targets on your grain, Michigan St. marketing specialist Jim Hilker provides some price probabilities, based on futures as of October 14:
1) Dec corn: 80% probability between $4.52 & $3.19, with the midpoint at $3.79.
2) Mar corn: 80% probability between $5.10 & $2.93, with the midpoint at $3.86.
3) Jul corn: 80% probability between $5.65 & $2.77, with the midpoint at $3.95.
4) Jan beans: 80% probability between $11.84 & $8.26, with the midpoint at $9.88.
5) Mar beans: 80% probability between $12.50 & $7.72, with the midpoint at $9.82.
6) Jul beans: 80% probability between $13.33 & $6.92, with the midpoint at $9.59.
7) Dec wheat: 80% probability between $6.03 & $4.30, with the midpoint at $5.09.
8) Mar wheat: 80% probability between $6.81 & $3.99, with the midpoint at $5.21.
9) Jul wheat: 80% probability between $7.66 & $3.74, with the midpoint at $5.35.
Farm program sign-up may be last on your priority list, but it has begun for the 2010 crop, and farmers who are eligible for Direct Payments may request advanced payments. Those payments would equal 22% of the applicable payment and will be made on Dec. 1. The deadline for sign-up for Direct, Counter-cyclical payments and ACRE is June 1.
“Striking” is the description used by IL crop production specialist Emerson Nafziger to describe the departure of 2009 growing degree days from normal. He says generally, the GDD predictions of maturity have held up fairly well this year, meaning that it took all of September in many fields for the crop to reach maturity. Late planting did not help. Read his newsletter. Nafziger also says frost started the dry-down process earlier and may reduce drying costs.
What is your kernel size? Emerson Nafziger says kernel size this year seems to be unusually large, even in later planted fields, which he terms “a positive development.” He says where kernels were still immature when frost killed the plant, some of the grain size will be lost, but since kernels were larger than usual, the yield will still be good.
What will stalk quality be? Nafziger does not anticipate much of a problem with stalk quality in connection with an early freeze. He says many stalks strengthened over the past month by increasing the presence of lignin; therefore stalk sugar content is not as important this fall for stalk strength. He says very immature corn could have problems.
When kernels get to the dryer Nafziger says high temperature drying may caramelize some of the sugars at the tip of the kernel. That may darken and may change the shape of the kernel. Those kernels may also have a lower test weight, and the combination of weight and discoloration may result in pricing discounts at the elevator. He says there is no difference in feed quality, however there is less starch needed by ethanol refiners.
Natural drying may stop at 17% to 18% moisture at this time, says IA agronomist Roger Elmore, and without many chances for field drying, he says attention needs to be given to stalk health. That means producers may have to harvest wetter corn first if it is lodging.
IA State grain quality specialist Charles Hurburgh says expect drying cost to be 5¢ per point of moisture removed, and 23% moisture corn will cost 40¢ per bushel, plus the loss from shrink. He says that means you may have an incentive to hold corn at higher moisture, and await better drying conditions in the spring, or blending opportunities, or sale of the grain to buyers of high moisture grain, but that could create high risks.
Shrink is an issue for high moisture grain, which is 1.17% per point for corn and 1.15% for beans. Hurburgh says any additional deduction in the market shrink calculation is an allowance for material handling losses. That would be a 0.22% handling loss if the elevator calculates shrink at 1.4% per point of moisture. He says an elevator experiences 1% overall handling loss and a good farm system would have about 0.5% loss. But both of those exclude any weight loss from spoilage if the grain goes out of condition.
Tests weights under 54 lbs. should be dried to under 15% moisture if they are going to be stored for any length of time. And breakage of kernels is a potential problem. Hurburgh says low test weight corn, which has been dried, should not be stored into warm weather next year. As moisture is removed, corn will gain test weight, and there will be more gain with low temperature drying compared to temperatures over 150ºF.
Soybean harvest, storage, and handling tips are handy given current weather conditions:
1) Grain storage tips, and formulas for crop drying storage and handling.
2) Soybean drying, handling, and storage.
3) “Harvest soybeans as early as possible.”
MN and WI farmers may have suffered significantly when the freezing temperatures halted the growth and maturity of substantial corn and soybean acres. If frost damaged less mature crops, MN agronomists say different management would be required, and they have created a website for that.
Grain drying fans are humming throughout the country. If yours is not, your grain shelf life may be shortened, according to NE ag engineer Tom Dorn’s rules of thumb:
1) When corn over 17% moisture is held at a constant temperature, the shelf life is cut in half for every 2% increase in moisture content.
2) When corn over 17% moisture is held at a constant temperature, the shelf life is cut in half for every 10ºF rise in temperature.
3) Grain stored without aeration will heat from microbial respiration and will have a shelf life about one-third as long because heat increases that activity, causing more heat.
Do a favor for yourself and your neighbors. Clean the buckthorn out of fencerows, waste areas, and along creek banks. It’s not that you don’t already have a lot to do, but the less buckthorn, the less of a problem with soybean aphids next year. Buckthorn will not resprout from underground roots, but stumps that are cut off will regrow. Pictures and detailed instructions.
If you don’t believe that eradicating some buckthorn bushes will help, think again. Those swarms of soybean aphids in September were all traveling to their winter quarters on buckthorn growing on your property and that of your neighbors. Researchers have found buckthorn leaves totally covered with soybean aphids, meaning management issues for 2010. Unbelievable pictures.
There is an 11 year trend in the population of European corn borer says IL entomologist Mike Gray, and the trend is downward, due to the introduction of Bt hybrid corn. He says the widespread use of Bt corn has significantly suppressed corn borer populations. Gray says that trend may lead to a decision that his annual survey can be discontinued.
The widespread use of Bt corn has also lead to questions about the populations of corn root worms says Mike Gray. He says the wet 2009 spring suppressed some, but the use of Bt corn and increased use of soil insecticides may show a downward rootworm trend.
I have diplodia in my corn. Your test weight may be light. If the cob is rotted, it may spread through the grain. Pieces of cob may result in discounts for foreign material. The elevator may also levy a dockage for the presence of kernels damaged by diplodia.
I don’t want diplodia next year. Choose hybrids with better resistance. Avoid planting corn into fields in 2010 that had high rates of diplodia in 2009. Bury corn residue as much as possible in fields with heavy infestation. Foliar fungicides have little effect.
Your fall to-do list may include control of winter annual weeds, and if you need some quick guidelines to save time, IL weed specialist Aaron Hager says consider these:
1) the warmer the winter weather, the more weed growth, compared to northern Cornbelt.
2) If soil residual activity is needed, apply early, if not, wait for weeds to begin growing.
3) Ensure that you know what weeds are growing and use effective herbicides for them.
4) Even with a soil residual herbicide applied now, the field may not be clean next spring.
5) When winter annuals are eliminated, some summer annuals emerge sooner than usual.
6) Do not expect to prevent waterhemp next spring by using a fall applied herbicide.
7) Fall applications allow higher rates which may control glyphosate tolerant weeds.
Kill a chickweed, kill a cutworm. That’s the essence of recommendations of OH entomologists, who say a weed free seedbed in the spring will reduce the locations for moths to lay cutworm eggs, particularly on chickweed. They are urging a fall application of herbicides to eradicate weeds and the potential for early spring homes for cutworms.
Your combine is your friend, but sometimes friends spread things we don’t appreciate and combines will spread weed seeds and fungal molds, says IL plant pathologist Vince Davis. He says, “if at all possible,” combine weedy patches last to quarantine seeds, and the same with moldy areas of soybean fields. If it is not possible, ensure the combine is as clean as possible before moving onto fields that have not been impacted by problems.
Conditions are ripe for Phomopsis seed rot in soybeans, particularly because of harvest delays from wet weather. It is a fungal disease resulting in chalky white, shriveled, shrunken soybeans. OH plant pathologist Anne Dorrance says seed may be infected and not show symptoms, but will die when put through germination tests now. However some of the fungi will die during storage and germination rates may be higher later. She says seed with levels of infection less than 20-25% can be managed with Fludioxonil.
Pork is popular, believe MO livestock economists Glenn Grimes and Ron Plain, who say, “The demand for pork at the consumer level was up 3.9% for January-August. For this period consumer demand for beef was down 2%, broiler down 3.4% and turkey was up 5.6% compared to the same period in 2008.” Feeder pig prices are spiraling upward.
Posted by Stu Ellis at 12:25 AM | Comments (2) | Permalink
October 15, 2009
Hog Marketing: Is There Any Way To Really Predict Prices?
The nation’s pork producers have seen deeper losses over a more prolonged period than the price collapse a decade ago. And it goes without saying any light on the horizon is seen as a glimmer of hope that the end is near and profitability will soon be restored in the pork industry. Many producers will look at futures prices for that hope, and others will depend on market forecasts by land grant university livestock economists. But is one more accurate than the other?
Livestock price forecasts are issued by marketing specialists to help producers reduce the risks they have in making production decisions. Those forecasts are developed from USDA reports, the historical relationships between price and supply, the current supply and demand, and a look at future supply and demand. Iowa State University livestock economist John Lawrence has issued a series of reports evaluating those market outlooks, the futures market, and the seasonal price cycle to determine which is a better forecaster of hog prices at the time producers are ready to sell.
Lawrence initially looked at a 10 year history of the futures market and the seasonal index. His results were calculated by subtracting the forecast price from actual price. He says the forecast errors ranged from $0.99 per head to $3.46 per head which implies the market price was usually underestimated. Lawrence reports there is a 68% chance that prices three months in the future will range above or below his forecast price by $5.33 per head. But he says, “When looking four quarters into the future, the time necessary to make breeding decisions, the 68% range grows to over $14.84 for the least variable forecast.” He says the seasonal cycles have the smallest errors, regardless how far in the future the forecast is made, however it also has the greatest variability.
Lawrence’s quarterly forecasts took on some personalities of their own, regarding their accuracy. He notes, “On average, all forecasts did a fairly good job predicting hog prices in the volatile markets. As shown by the average errors, the January Forecast itself was best at predicting one quarter into the future, and worst at predicting three quarters into the future. The April Forecast was best at predicting four quarters into the future and worst one quarter into the future. The July and October Forecasts were best at predicting two quarters into the future, and worst four quarters into the future.”
When Lawrence analyzed the weekly prices of the lean hog futures contract, and compared it to the expiration price, he found that some months trend above the expiration price, others trend below it, and some are on both sides of it. His study of those contracts over the past 10 years found, “The contracts for April through October tended to have more years where the weekly prices were below the expiration price on average, indicating positive errors, or under prediction by the weekly prices. February varied widely, and December had more years with weekly prices above the expiration price on average, indicating over prediction.” He says the most accurate month on average was February and the least variable month was August. He says, on the whole, the Lean Hog Futures contract is very accurate in predicting the price at expiration, and is a good tool to help traders make accurate and profitable decisions.
Finally, Lawrence looks at the significance of errors that the futures contracts make in predicting the expiration price. Over the past 18 years he says, “There is not a consistent pattern across the contracts. February, April, and October vary widely on average. June (with the exception of 8 weeks out) and August tend to under forecast on average. December tends to over forecast on average. On average, all contracts have a slight tendency to over forecast.”
Summary:
For pork producers wanting to make better marketing decisions as a means of improving their potential profitability, the use of market outlooks, futures prices, and seasonal cycles can all provide significant assistance, but it is important to know the potential for errors. Each have the tendency to err on one side or the other of the eventual market price when a futures contract expires. However, some months are typically over estimating the market and others underestimate, and it is also possible to know how much the error is expected to be. A study of those trends and errors can create profitable marketing plans for pork production
Posted by Stu Ellis at 12:31 AM | Comments (0) | Permalink
October 14, 2009
If Big Crops Get Bigger, Do Small Crops Get Smaller? And How Does That Apply To 2009 Corn And Soybeans?
Market watchers will tell you that big crops get bigger, specifically when it comes to monthly production estimates by USDA’s National Agricultural Statistics Service. If there is a bumper corn crop forecast in August, it seems to get larger and larger as the monthly estimates arrive in the fall. But is that always true for corn and is there any truth in that adage for soybeans? Will the November estimates be larger than the Oct. 9 projections?
Looking at the last 30 years of crop production estimates, Purdue marketing specialist Chris Hurt examined the trends linking the August through November crop reports. He theorizes that if big crops get bigger, then small crops should trend smaller. His focus was on the change in yield from September to October, and how it related to the change from October to November and the final estimate that USDA releases in January.
For corn Hurt says, “The odds were 73% that an increase (decrease) in the October yield estimate was related to an increase (decrease) in the November estimate. For the final yield in January 76% of the time higher (lower) yields in the October report related to higher (lower) yields in the final January report.” Hurt says when there was a two bushel change up or down from September to October, there was a 92% chance the January estimate would go in the direction set from September to October. He points to the recent report that boosted the September corn estimate from 161.9 bushels to the 164.2 bushels estimated in October.
Hurt says the implications for 2009 are derived from his 30 years of monthly comparisons. Based on the trend from September to October, he says that points to a 1.4 bushel per acre increase in the November report and a .2 bushel per acre increase that would be reported in January, which would place the final yield projection at 165.8 bushels per acre.
As an aside, Hurt says such an increase would mean an additional 127 million bushels of corn, but he believes the recent frost and freeze damage across the northern Cornbelt that affected 130 million bushels would be an offset to the increase. He contends USDA would not have to revise the projected 1.672 billion bushel carryover downward as the market expected after the freeze damage. And he suggests that the recent market uptrend would not be sustainable because the larger crop offset the weather damage.
But what about soybeans; can the same be said about larger crops getting bigger? Purdue’s Chris Hurt says the tendency for soybeans is not as strong and it is harder to make predictions about large soybean crops getting larger as the fall wears on. He says, “Over the last 30 years from 1979 to 2008, 67% of the time a higher (lower) yield estimate in October was associated with a higher (lower) yield in November and 63% of the time a higher (lower) October yield estimate was associated with a higher (lower) final estimate in January.” But while that seems to be a strong relationship, Hurt says if there are only small changes in the yield from September to October, the potential for predictions withers. And this year the September to October change was only .1 bushel.
Hurt says when the national yield forecast was less than .5 bushels, the final yield was anywhere from 1.7 bushels higher to 1.7 bushels lower than in September. Thus he says, meaningful clues just are not there for the yield trend in the current soybean crop.
Summary:
The market adage seems to be true that big corn crops get bigger. When there is at least a two bushel change up or down between the crop estimates in September to October, the trend will continue in that direction. That means the 2009 corn crop will get larger and the added bushels could offset the recent loss of bushels to frost and freeze damage. However, the same cannot be said for soybeans, particularly when the change from month to month is small as it is this year. Predictions for such trends in beans are more difficult than they are in corn.
Posted by Stu Ellis at 12:34 AM | Comments (2) | Permalink
October 13, 2009
Ohio Livestock Interests Preempt Humane Society's Livestock Production Restrictions.
Ohio voters in three weeks will consider a statewide referendum spurred by the Humane Society of the US in its effort to radically change livestock production practices. However, the referendum, known as Issue 2 on the November 3 ballot, is something that the Humane Society is advocating a “no” vote, and agricultural interests are urging a “yes” vote. In other words, the agricultural interests in Ohio, knowing that the Humane Society had targeted their state, stepped ahead of HSUS to get a pro-livestock production issue on the ballot instead.
The Humane Society has taken credit for ballot initiatives in California, Arizona, and Florida where certain livestock production practices have been banned. And in California, the initiative will have closed down that state’s egg production industry by 2015 according to political analysts. In Michigan, a new law took effect Oct. 12 that phases out chicken cages and sow gestation crates within 10 years and veal crates for calves within 3 years, which was pushed by Humane Society lobbyists.
Taking preemptory action, Ohio agricultural groups convinced the state legislature to approve a ballot initiative to create a livestock care standards board to advise the Ohio Department of Agriculture. Ohio State University economist Brian Roe the board would establish standards for governing the care and well-being of livestock and poultry in Ohio.
The Humane Society had intended to propose its own set of rules which Roe says could result in laws similar to those in California and other states which have severely restricted livestock production. That is the reason the HSUS is urging rejection of the referendum, which would be composed of representatives of farms, farm organizations, veterinarians, food safety experts, the dean of an ag department at a university in Ohio, and a representative of a county humane society organization. The purpose is to: 1) maintain food safety, 2) encourage locally grown and raised food, and 3) protect Ohio farms and families.
Roe says if Issue 2 passes, there are several possible scenarios, although none is guaranteed to occur.
1) There would be no change in agricultural practices in Ohio.
2) There could be some additional paperwork for livestock producers to report their production practices, but changes would not be required.
3) There could be public pressure to force changes in production practices.
Roe is quick to say that passage of Issue 2 does not preclude the Humane Society in returning to the legislature and seeking a “California-style” ballot initiative to radically change the way livestock are produced in Ohio, but it would likely decrease the odds of that happening. But Roe says if Issue 2 fails on Nov. 3, there may be an initiative in 2010 to pass a wide ranging law to ban a variety of typical livestock production practices. He says lawmakers and farm groups may try to negotiate a deal, similar to Michigan, which gave the HSUS what it wanted, but delayed the bulk of the changes for 10 years.
The OSU economist says if a California-style law is approved in Ohio, farmers will have to spend money to change their practices, which are 20% more costly for poultry production, or they could alter their marketing strategy to not require the purchase of meats produced with the altered practices, or they could move their operation to another location where policy issues were not as threatening, or they may exit the livestock production business.
Summary:
With the expectation the Humane Society would seek to radically change livestock production practices in Ohio, agricultural interests there will seek voter approval next month for establishment of a livestock care standards board, made up primarily of pro-livestock interests. They fear that Ohio would be the target for new rules that would ban chicken cages, sow gestation crates, and veal crates, which have been banned in several other states. There is no guarantee the referendum will pass or that opponents will seek restrictions on production in another year.
Posted by Stu Ellis at 12:05 AM | Comments (0) | Permalink
October 12, 2009
China And Your Soybean Revenue
The falling value of the US dollar against foreign currencies has again sparked the commodity market because of export potential. And with USDA raising its estimate of soybean exports to 1.3 billion bushels in the current marketing year, farm revenue will be dependent upon hungry humans and animals overseas. At least that was apparent in the Oct. 9 series of USDA reports.
USDA’s October Crop Report raised the forecast for soybean exports to 1.305 billion bushels, a record amount, in part because total production was increased to 3.250 billion bushels and a slight drop in price estimates will help spur interest of foreign buyers. The World Agricultural Supply and Demand Estimates reflected the increased interest by global importers, particularly China. With 40% of US soybeans being exported, a substantial amount of the $8 to $10 farmgate price range can be attributed to export trade.
This comes in the wake of increased world production, say USDA economists, “Global soybean production is projected higher with increases for the United States, Argentina, and Paraguay only partly offset by lower production for China. Argentina soybean production is raised 1.5 million tons to 52.5 million due to increased area as producers shift to soybeans from other crops including corn and sunflower seed. China soybean production is lowered 0.5 million tons to 14.5 million due to lower harvested area as producers shifted more area to corn.” And the economists believe global stocks of oilseeds will be increasing, “Global oilseed stocks for 2009/10 are raised 4.5 million tons to 66.0 million. Soybeans account for most of the change, with increases projected for the United States, Brazil, Argentina, and China.” Although Chinese oilseed stocks are growing, USDA’s estimates of its imports are also being increased, both for the old and new marketing year.
Along with the estimated 1.305 billion bushels of soybean exports from the US during the current marketing year, USDA also forecasts the export of 3.250 billion pounds of soybean oil and 9.600 million tons of soybean meal. Both reflect no change from the September Supply and Demand report. However, soybean oil exports would be a 47% increase over the 2008-09 marketing year, and meal exports would be an 11% increased over last year.
Argentina, which exported about 5.9 million metric tons of soybeans last year will increase that to about 9.7 million tons after its crop is harvested early next year. However, soybean meal exports will increase from 24 to 27 million metric tons. Brazil exported about 30 million metric tons last year, but that may drop to 24.5 million tons this year. At the same time, Brazilian soybean meal exports that were 13 million tons last year, are estimated at 12 million tons for the current marketing year.
As previously mentioned, China will be a major purchaser, and will buy more than one billion bushels of soybean from world suppliers, according to the latest USDA estimates. The European Union will buy over 300 million bushels, and Japan will buy about 100 million bushels of soybeans.
While US ending stocks of soybeans in August of 2010 are expected to be 230 million bushels, Brazil is expected to have more than twice that supply and Argentina will have about four times that level of carryover supplies of soybeans.
Summary:
While USDA raised its estimate of US soybean production to 3.250 billion bushels, it also raised its estimate of soybean exports to 40% of the new crop. While the larger supply will result in a slightly lower price, the falling value of the US dollar is making US commodities attractive once again to foreign buyers. China, which raises a large amount of its own soybeans, will be buying as much as one billion bushels from the US and from South America. For soybean farmers, exports will be a major part of their market price, and China will be a substantial contributor to it.
Posted by Stu Ellis at 12:24 AM | Comments (1) | Permalink
October 9, 2009
Cornbelt Update--UPDATED WITH OCTOBER CROP REPORT
Cornbelt 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.
USDA pushed up its forecast for 2009 corn production to 13.018 bil. bu., slightly above the 12.955 bil. forecast in Sept. and within the range expected by the market, but well above the 12.986 bil. bu. average of trade guesses. The October Crop report also adjusted acreage expectations to 79.294 mil. acres, down slightly from Sept. The corn crop will be 8% higher than 2008, helped by a more than 10 bushel per acre jump in the national average yield. USDA kept yield forecast steady or raised them across the Cornbelt because of favorable Sept. weather.
USDA also pushed up its forecast for 2009 soybean production to 3.250 bil. bu., up slightly from the 3.245 bil. forecast in September. The projection was within the range the market was expecting. USDA also added 0.1 bu. to the average yield and reset it to 42.4 bu. per acre and cut the expected harvested area slightly from the September estimate.
USDA's Supply and Demand Report for corn made some minor adjustments in use. Feed use was raised 50 mil. bu. to 5.4 bil. Exports were lowered 50 mil. bu. to 2.150 bil. Ending stocks were raised to 1.672 bil. but the price range of $3.05 to $3.65 was retained.
USDA's Supply and Demand Report for beans retained crush estimates at 1.690 bil. bu., but raised export estimates by 25 mil. bu. to 1.305 bil. The carryout was raised to 230 mil. bu., and the season average price range was dropped ten cents to $8 to $10 per bu.
Ahead of the Monday freeze, crop forecasters said the corn is immature and vulnerable for 60% of ND, 50% of WI, 40% of MI, 40% of MN, 35% of IL, 30% of IN, 30% of OH, 20% of SD, 20% of NE, 10% of IA, and 10% of MO. Another forecaster with similar estimates computed the damage would affect more than 232 mil. bu. of immature corn.
The combination of freezing temperature halting corn maturity and the resulting light test weights leads MI St. marketing specialist Jim Hilker to doubt the accuracy of either the Oct. or Nov. USDA crop reports. He says, “This is not a criticism of USDA, but rather the fact of a very late maturing corn crop.” He’s waiting for the final report in Jan.
Hilker says the market is willing to pay for on-farm corn storage with the monthly spread of 4¢+ per month. However that is not enough to cover commercial storage plus lost interest. His advice is, “Those who need off-farm storage and are pretty sure the market is going up should consider basis contracts, sell cash-buy futures, sell cash-buy call options, a minimum price contract, or sell cash and an appropriate call spread.”
Hilker’s probability for Dec corn: “There is a 10% chance that the price will be higher than $4.03 and a 10% chance that the price will be less than or equal to $2.89. This indicates an 80% probability that the price will fall between these two prices. There is a 50% chance the price will be less than or equal to (or greater than) $3.41.”
Hilker’s probability for Nov beans: “There is a 10% chance that the price will be higher than $10.20 and a 10% chance that the price will be less than or equal to $8.38. This indicates an 80% probability that the price will fall between these two prices. There is a 50% chance the price will be less than or equal to (or greater than) $9.24.”
US corn exports will increase, thanks to smaller corn crops in Canada, South Africa, and China, which are competitors says IL marketing specialist Darrel Good, pushing the US share of world corn trade to 65% from 60% last year. He says global demand will grow 9% because of smaller European and Mexican crops and more Chinese demand. Read his newsletter.
US soybean exports will remain steady with fewer purchases by Europe and China being offset by more purchases from Japan and Mexico. Good says that is happening at the same time Argentine and Brazilian exports are increasing. Production was down 31% in Argentina and 7% in Brazil last year, but planting will increase in both nations this year. Good says Argentina will raise 700 mil. more bu. and 185 mil. more in Brazil.
Soybean rust spread with a vengeance in the past several weeks, being found in every county in AL, all but 1 county in MS, nearly all of AR and LA, and spreading up the Mississippi River to southern MO and southern IL. It now has been found in 370 counties in 16 states as of Oct. 8. The most northern county is McDonough Co. in Illinois, near the Mississippi River at the latitude where the states of IA and MO meet.
Soybean rust reached the MO bootheel with the help of a weather system on Sept. 10. MO plant pathologist Allen Wrather says the recent infections were fresh, extensive, but would cause little damage because of the maturity of most soybeans, which were in stage R6. However, some July planted beans which were in stages R3 to R5 will be susceptible to damage and Wrather says farmers will need to make a decision on treatment.
Discolored soybeans, if you have them, are the result of many weather-related fungi that found this year to be perfect to work overtime. MO plant pathologist Laura Sweets identifies many types. Sweets says many of the pathogens causing discoloration will survive on seed beans, and heavily infected seed, if planted next year will produce diseased seedlings and poor stands.
Immature soybeans will not mature in the bin says MO crop specialist Bill Wiebold, “If death occurs late in the seed-filling, the green color is confined to the seed coat. If death occurs during early to mid fill, the green color remains throughout the interior of the seed." Green soybeans produce green soybean oil and processors will charge dockage because consumers do not want to cook or fry with vegetable oil with a green color.
If your soybeans did not mature before the freeze, Wiebold says split them with a knife and if only the coat is green, the soybeans should be classified as yellow beans and not docked. He says if less than 90% of the seed interior is yellow they will be graded as “soybeans of other color.” A load with 10% “other color” will be graded as standard and could receive substantial dockage, and a lesser quality will be graded “total damage.”
Kernels sprouting on the ear are being reported by KY agronomist Chad Lee, who says they are base kernels and are kept moist by the husk structure. And he adds, “Sprouting kernels are not a direct hazard to livestock. However, molds are sometimes associated with sprouting and some molds can produce mycotoxins. If corn is being used for livestock feed, have it checked for mycotoxins. Sprouting kernels will reduce test weight and yield, slightly.” He says it is just a symptom of the cool, wet fall.
Various molds and ear rots may be hiding in your fields, and may necessitate some fields being harvested before others while they are still standing, says IA plant pathologist Alison Robertson. Test at least 100 plants in a field looking for stalk firmness and if lower nodes are weak, which will threaten standability. Harvest weaker corn first.
Diplodia ear rot is a dense white mold between kernels, making them light weight and reducing nutritional value. Toxins are not produced. Diplodia usually spreads in the field but can be a problem in storage if the grain moisture exceeds 20%.
Giberella ear rot begins at the tip of the ear with a pink to red colored mold and can be found on ears damaged by hail. It will produce DON also known as vomitoxin.
Fusarium ear rot is indicated by a white, pink, or salmon colored mold anywhere on the ear. It is usually found where insects have damaged kernels or the ear has been damaged by hail and kernels turn brown. Fusarium produces a mycotoxin called fumonisin.
Giberella stalk rot causes a pink to reddish discoloration of the pith inside a corn stalk, but on the outside will be small, round, bluish-black bodies near the nodes of the stalk.
Anthracnose stalk rot will have black shiny lesions on the outside of the stalk and on the inside, the pith of affected corn plants will be discolored and shredded.
For some good news….corn will be able to break the 300 to 350 bu. barrier says Purdue agronomist Tony Vyn, as long as each plant has every opportunity to compete with other plants in the row, and inputs such as nitrogen and population are not limiting factors.
What corn hybrids are you planting next year? MN corn specialist Jeff Coulter says the steadily increasing yield is a result of picking hybrids that closely approximates the growing degree days in your area. He says pick them to mature 10 days prior to frost.
1) Plant multiple hybrids to spread risk and widen out the harvest interval.
2) Yield varies more within a relative maturity rating than between maturity groups.
3) Select hybrids that are top performers in multiple test sites and in different weather.
4) Select hybrids on standability, disease tolerance, and need of transgenic resistance.
Livestock producers grazing sudangrass or sorghum sundangrass should move animals away from those forages for several days following a frost that would produce prussic acid. Sudangrass 18+ inches or sorghum sudangrass that is 30+ in will recover in 3-4 days. Hold livestock away for 10 days to 2 weeks if the grass was shorter. New shoots on partially frosted plants can be toxic as well, and should be avoided for 2 weeks.
Alfalfa, clover, and other perennial forages do not produce toxins and can be grazed or baled and fed to livestock after a killing frost. If the forage is not needed, IA forage specialist Stephen Barnhart says it is best for the plants to be uncut and left for the winter. Alfalfa cut after a partial freeze will re-grow and use up energy needed for next spring.
What is your soil pH? If you don’t know, you need a soil test; and if it is too acidic because of your regular nitrogen applications (hint), you may need a good dose of lime. IL crop specialist Jim Morrison says there are many reasons to consider some limestone:
1) Lime lowers the soil concentration of aluminum and manganese, which can be toxic.
2) An increase in soil microbial activity is noted as soil acidity is decreased.
3) Liming enhances nitrogen fixation and may improve soil structure and tilth.
Sample for soybean SCN in the fall, but don’t look for corn nematodes. IA plant pathologist Greg Tylka says their numbers decrease in the latter part of the growing season, and if you find some, it is not possible to work backward and estimate how many you may have had. Needle and sting nematodes can be found in lower soil levels.
Soybean cyst nematodes are best found in the fall, and Tylka says look in your soybean fields if you detect yield loss from SCN. Sample soil at 6-8 inches down, with 15-20 samples taken and blended for a composite sample. A testing lab needs 1 cup of soil.
Late harvest means late wheat planting for many farmers and OH agronomists say there may be inadequate tiller development before winter dormancy. If planting late, boost the seeding rate to 1.6 to 2.0 million per acre, and recalibrate your drill based on seeds per pound. Plants may be smaller, with shallower roots, and susceptible to heaving. That means plant no-till with a 1.0 to 1.5 inch planting depth to reduce heaving by 95%.
It is a record-setter. Slaughter steer carcass weights for the 5-state marketing area topped 900# for a weekly average. But livestock economist Dillon Feuz at Utah St. questions any pride. Read his analysis.
1) In 2001, the average steer carcass weight for the same area was only 803#.
2) Prior to 1980 the same steer at the same markets averaged less than 700#.
3) To get consumers to eat more beef, the price must be lowered.
4) Each producer is doing what is best for him: adding more weight.
5) More total weight means a lower general market level price.
Did you always intend, but never got around, to learn the differences among various financial reports that could identify success or potential problems with your farming operation? If so, MN farm finance specialist James Kurtz offers a series of fact sheets on such reports as Balance Sheets, Income Statement, Statement of Owner Equity, Statement of Cash flows, and a fact sheet on various financial ratios. Find the fact sheets here.
Did you always intend, but never got around, to planning out your estate and transferring your tangible assets? If so, several MN farm finance specialists have created a series of fact sheets on what to think about, what to do, and how to go about the process of estate planning. To save time and money before going to an attorney, find fact sheets here.
Did you always intend, but never got around, to developing a process to transfer your farming operation to the next generation. If so, several MN farm finance specialists have developed a roadmap for Cornbelt farmers to consider and discuss among family members about ways to financially benefit and protect all parties in that process. Find the fact sheets here.
Are you spending more or less than Brazilian farmers on crop protectants for soybeans? The Oct. 5 newsletter of CropSpotters asked several Brazilian farmers about their soybean chemical costs. Don’t worry about the need to equate reals and dollars or hectares and acres. Their answers are already in terms of “bushels per acre” and their costs range in value from 2.7 to 6.9 bushels of soybeans per acre.
Posted by Stu Ellis at 12:05 AM | Comments (0) | Permalink
October 8, 2009
Cap And Trade: How Likely Will You Get Compensated For Sequestering Carbon?
The climate change legislation is now in the hands of the US Senate. Earlier this year the House approved legislation that aims to reduce carbon emissions, and offered farmland owners the opportunity to dedicate their land to reduced tillage and in return receive small payments from industries that emit carbon dioxide and other greenhouse gases. The Senate did not make any substantial changes that would be more beneficial to farmers, thus the so-called “cap and trade” program will have to be evaluated by land owners and operators to determine if there will be any benefits for their property. Your farm may or may not benefit from “cap and trade,” depending on several issues.
Instead of allowing carbon-containing gasses to flow into the atmosphere, the climate change legislation would have carbon retained and/or returned to the soil. The crop production process is a major key to achieving that goal, but farm owners and operators have to determine if their change in production practices is worth the payment to retain carbon in the soil, called sequestration. USDA economists have issued a recent brochure that helps in the understanding of the pros and cons of the issue.
One of the initial issues is the requirement to sequester carbon for 5-10 years, and farmers with a year to year cash or crop share lease may express some reluctance. Owners may be quite willing to make a long term commitment, but operators who are short tenure will have to evaluate the merits. The economists say sequestration of carbon on a given farm can complicate lease negotiations and rental rates.
The economists also believe it is too early to tell how large any payments will be and how farmers will respond to those payments given the changes that will be required. They think farmland with a tenure rate above 80%, meaning ownership or long term renter, will make land use or production practice changes at a rate of 45% likelihood. However land with a tenure rate under 20% will only see 20 to 25% of it enter such a program.
To some extent the carbon sequestration program may be compared to the Conservation Reserve Program because 2/3 of the carbon sequestration potential comes from conversion of cropland into grassland or timberland. USDA’s statistics indicate that a large volume of high tenure farm and ranchland have large amounts of pasture, hay production, or trees, and many of those high tenure farms have CRP land on them. Conversely, low tenure land, which many see more rental operators will have more acreage in crop production and less in CRP, thus would be less likely to be interested in a carbon sequestration program. Over 70% of US cultivated cropland falls in the categories of lower tenure rental operators.
So what happens if you make a change in production practices? How much carbon will you save? Within the Cornbelt, a change from conventional tillage to reduced tillage will sequester 0.09 tons of carbon per acre per year, which would increase to 0.17 tons if the switch were made to no-till. By retiring cropland into a CRP program, 0.25 tons of carbon would be sequestered per acre per year, and if cropland were converted to pasture or hay, that would rise to 0.50 tons per acre per year.
While your 2,000 acre corn and soybean farm may not be an immediate candidate for a carbon sequestration program, there are some land owners who may already be counting the cash. USDA says half of the potential carbon sequestration potential is concentrated on just 7% of farms in the Northern Plains and Mountain regions which operate 38% of all farmland. They have a high tenure rate and already contain 52% of US hay and pastureland and 58% of the CRP enrollment.
The USDA economists contend farms that are likely participants in a carbon sequestration program will be larger operations, potentially with livestock and willing to convert marginal cropland to grazing lands. They add that price signals from a national cap and trade system would encourage changes in agricultural practices but would not encourage non-operating landowners to make radical changes in their leasing arrangements.
Summary:
If you are counting on reducing the farm mortgage with payments from a carbon sequestration or cap and trade program, your farm may not be a typical one in the Cornbelt. The most likely farms that would participate in the program to reduce carbon emissions are going to be large operations which with long term owner or rental arrangements, potentially with livestock on grazing lands, and willing to convert any marginal cropland into more pasture or hay production. While payments from such a program are unknown, and the legislation has not even been passed by Congress, the benefits to agriculture seem to be limited to compensation for eliminating any tillage and converting cropland into a long term setaside similar to the CRP.
Posted by Stu Ellis at 12:07 AM | Comments (1) | Permalink
October 7, 2009
Is Your Yield Monitor Really Monitoring Your Yield?
Last year your corn was heavy, and test weights were 56 pounds and up. This year your corn has patches of diplodia fungus in the field and fluffy corn may be a good description of some of it. Will your yield monitor be able to adjust itself for the difference and give you a reliable reading of bushel yield? (Grimace) Probably not.
You have been relying on a yield monitor for field mapping, reports to landowners, and keeping your lender apprised of your financial prospects. But has that piece of equipment been providing a service or a disservice? Ag engineer Matt Digman at the University of Wisconsin suggests you monitor your yield monitor. His latest newsletter says your yield monitor depends on many sensors on the combine but needs to ensure that all of them are giving it the best information possible. If the brain in the system is misinterpreting what it is being told, it will not be able to make its calculations properly and give you reliable information.
Digman says there are specific steps that must be taken by you and the yield monitor to ensure it is accurate:
1. Determine the area that has been harvested. Each brand may have a different way of doing it, but it needs to know when the combine is actually operating. That is done with a sensor that indicates the header is at harvest height and the separator is operating.
2. The monitor needs to know the width of the swath you are taking or number of rows being harvested. You will need to tell it the number of rows or width of your header.
3. The width combined with the speed of the combine allows the yield monitor to calculate the area harvested within a given amount of time, which is usually reported in acres per hour. A linked GPS system will automatically calibrate speed. The yield monitor will use the area harvested combined with the grain sensor to correct its calibration.
4. When the monitor has computed the area harvested, it needs to know how much grain has been taken into the combine. Digman says development of a reliable weighing system has eluded ag engineers, so the task depends on sensors that detect the flow of a mass of grain entering the combine. Sensors that detect the volume of grain in the clean grain elevator will store that information until you can enter the aggregate weight of grain from an elevator scale ticket. At that point the yield monitor has a good indication of the density of the grain (either heavy or light test weight), and can compute its estimated yield.
If the density of the corn is uniform throughout the field the yield monitor will provide a perfect indication of the yield. But if patches of diplodia-damaged fluffy corn are harvested, there will be a variation in the accuracy of the unit. Digman recommends a recalibration of the unit every 2-3 weeks or more often if crop quality changes.
Another technology used by yield monitors requires an impact plate that the grain hits as it moves from the clean grain elevator into the combine tank. The accumulated force on the impact plate keeps a running calculation of the yield. The impact plate will not only wear over time and provide varying reliability, but will also need regular recalibration depending on grain quality. The impact plate creates a small current that increases in voltage as the total weight of the grain increases as it hits the plate. Digman says, “What this means for the operator is that multiple calibration loads are necessary to ensure yields collected at very high and very low mass-flow rates are accurate.”
Yield monitors vary too widely in how they are calibrated to be discussed here, but Digman says follow the instructions closely to ensure you have an accurate yield calculation as is possible for that unit.
What about moisture of the grain, since it determines number of bushels? Digman says yields must be corrected for moisture, since grain that is wet and heavy will give you a false hope of high yields.
Summary:
Yield monitors can be valuable tools in your information technology process, however they have to be calibrated to the density of the grain, the area being harvested, and the moisture of the grain to give an accurate report of your yield. Different manufacturers will rely upon sensors in different locations in the combine, but all have to be working properly to each other to ensure accuracy. The calibration process may be complex for some units, but it must be accomplished regularly to ensure that yield reports will accurate describe the changing condition of the grain being harvested.
Posted by Stu Ellis at 12:38 AM | Comments (0) | Permalink
October 6, 2009
Corn Stalks: Will You Shred Them Or Use Their Value?
You are harvesting corn, because that is what the market wants and a price is offered for it. However, the grain only amounts to 50% of the weight of the dry material in your field. Are you leaving something in the field that may have value? So far the nearest ethanol plant is not yet accepting biomass feedstock, so what is the value of that pile of dry corn stalks in the field and how can you benefit from it?
For many farmers whose fall to-do list includes chopping corn stalks, the ideas of Paul Jasa may sound like heresy, but the University of Nebraska ag engineer offers some ideas of managing corn residue to resolve some problems you may have. He says the good yields and increased volume of plant material above the soil may have created concerns about what to do with your bumper crop of corn stover, and how it will control your planting schedule next spring.
The cornhead on your combine may be one of the keys to the problem, and it will become a good partner if it can process the corn stalks by leaving them on the ground and reducing the amount of material that runs through your combine. That could be a problem for no-till farmers, but consider Jasa’s idea of leaving as much as possible of the stalk standing upright, and that reduces the amount of material between the rows that planters have to cut through next spring. Jasa is an advocate of knife to knife or tapered snapping rolls, which he says are more aggressive in lacerating and crushing stalks; and with running the combine header about a foot off the ground to leave standing stalks. While those standing stalks will deteriorate from the exposure to weather and microbes, they will also hold the rest of the residue between the rows to reduce soil erosion and preserve moisture in the spring. However, with stronger stalks that resist growing season disease and insect pressure, their winter deterioration becomes important and using the combine to jump-start that process is important.
Cornstalks that are 12-18 inches tall, left to overwinter in the field, will keep residue in place, catch snowfall, and reduce wind erosion. Jasa said air movement is enhanced down to the surface of the soil to encourage microbial breakdown of the stover, compared to matted or flat residue left with stalk choppers. However, he says the upright stalks that remain standing in the spring may get caught on planting equipment.
To clean up corn and prevent problems with volunteer corn next year, Jasa suggests grazing stalks or mechanically removing some residue, but not every year. If alternating strips of residue are removed, they should be as wide as your planter, to allow for early controlled planting next spring where the soil has warmed early.
The residue left in the field should be treated as a valuable commodity because it protects against erosion, and saves 3-5 in. of water over the year. The residue also is a valuable source of fertilizer, with each ton contributing 17 lbs of N, 4 lbs. of P, and 50 lbs. of K, and if the stover is removed, those elements need to be replaced.
The use of a cover crop will retain humidity in the crop canopy and continue the effort of residue breakdown. They will also help dry out poorly drained soils and aid to spring warm up. But Jasa says control the cover crop or it will dry out the soil and created unwanted residue.
By not using a stalk shredder, Jasa says the corn stalk is not as flattened and that will keep the opportunity for more uniform deterioration in the spring, since air and moisture can circulate.
Summary:
Some out of the box thinking about handling corn stalks may offer some new solutions to old problems. Shredding stalks will create a dense mat that will deteriorate more slowly than corn stover that allows air, water, and microbial activity. However, allowing stalks to stand will keep the biomass porous while it prevent soil erosion and retains moisture. The key to its success is the use of proper snapping rolls on a combine that will crush stalks to allow them to stand 12-18 tall, yet deteriorate over the winter to not interfere with planting progress.
Posted by Stu Ellis at 12:59 AM | Comments (0) | Permalink
October 5, 2009
Farm Equipment: Should You Own, Rent, Lease, Or Hire A Custom Operator?
You were one of the hundreds of thousands of Cornbelt farmers who attended the 2009 Farm Progress Show, and you saw a (insert piece of farm equipment) that you really want. It will help you become more efficient. It will make you more productive and capable of farming more acreage. You have some equity accumulated from 2007 and 2008 commodity sales, but do you really want to deplete your savings in a year when profitability will be slim, or even negative. What choices do you have?
Whether you have your eyes on a new combine, tractor, planter, tillage tool, or something else, Iowa State University agricultural economist William Edwards wants you to ask yourself some fundamental questions that will help you determine your approach to acquiring that piece of machinery. His recent newsletter summarizes the alternatives and his suggested questions include:
• How much will it cost to own and operate an item of machinery?
• What other ways are available for you to acquire the machine's services? What are their expected costs?
• How much capital will you need if you purchase the machine? Can you afford that much investment? Can capital be used more profitably in other areas of your farm business?
• What are the income tax advantages of each method? What is your own tax situation?
• Do you have the ability, tools, and labor to operate the machine and maintain it?
• Are current technological developments likely to make the machine obsolete in the near future?
• Are you likely to change production practices or farm size in the near future and no longer need this type or size of machine?
Your answers to these questions will help determine whether you should own, lease, or rent equipment, or hire the work done by a custom operator.
Ownership can be either individual or jointly owning equipment with someone else; and ownership is the most popular method of controlling farm equipment. It does what you make it do and are responsible if it does not achieve that objective. But the initial responsibility is paying for it, whether it is cash or financed. Edwards says a partner can help with the financial affairs, as well as maintenance and repairs, but you have to agree with each other about when, where, and how the equipment is going to be maintained and utilized, in addition to having an ownership agreement that addresses dissolving the relationship. Ownership gives you the opportunity to buy used equipment when either resources are diminished or use will be infrequent. Older equipment may require more maintenance and those costs should be budgeted.
A form of ownership is exchange of labor and equipment. Your planter may serve both farms and your neighbors combine may serve both farms, and such an arrangement will require agreements on timing, responsibility for repairs, and equitable use.
Rental of equipment is usually for a short time and charges may be for a specific time period or acreage. You have the responsibility for maintenance, insurance, and complete operational costs. Edwards suggests that rental would be appropriate for:
• Expensive equipment such as a grain drill needed for only a short period each year.
• Supplementing equipment when only short weather windows were open.
• Testing new technology before deciding whether to buy.
Leasing equipment covers a longer period of time and gives you complete control and responsibility for the equipment, with the choice of returning it to a dealership or purchasing it. An operating lease usually requires an annual or semi-annual payment, with the choice of purchase at the end of the lease period for its fair market value. A finance or capital lease considers you the owner of the equipment with the capacity for depreciating it. Leases require you to pay any taxes, insurance, and repairs. Edwards says leasing is a hedge against inflation since payments are known in advance, and lease payments may be less than loan payments if the purchase is being financed.
Custom hire brings an operator with the equipment, who is responsibility for maintenance and complete operation. There is no long term capital commitment, such as financing or lease payments, and the custom hire rate should be established in advance. It is particularly useful for specialized equipment that is used infrequently and would be too expensive to own and store. The downside to custom hiring is the availability of the equipment when you want and need it.
One of the major issues that may help determine your choice of machinery acquisition is the tax consequences, such as depreciation or the deductibility of lease payments.
Summary:
Farming requires either ownership of equipment or the ability to acquire equipment when it is needed and at a reasonable cost. The choice of ownership versus leases and rental agreements may boil down to tax considerations, as well as the need to keep your equipment technology at an economical point.
Posted by Stu Ellis at 12:23 AM | Comments (0) | Permalink
October 2, 2009
Cornbelt Update
Cornbelt 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.
Both the US corn and soybean markets are impacted by South American crop production, and IL marketing specialist Darrel Good says their size will influence prices in the US. Currently, corn acres in both Brazil and Argentina are expected to decline and soybean acreage in both countries is expected to increase. Read his analysis.
Despite fewer corn acres, total production is expected to increase because of better yields following droughty conditions in the 2008-09 growing season. The total crop is expected to be 2.6 bil. bu., compared to 2.46 bil. bu. last season. However, with more bean acres, production should reach 4.15 bil. bu., up 880 mil. bu. from the 2008-09 crop. 2010 South American crops are expected to benefit from an El Nino.
Good says those crops will compete with US corn and beans in the export market, but currently, USDA anticipates record US soybean exports of 1.28 bil. bu., and for US corn exports to reach 2.2 bil. in 2010. The latest USDA estimate of global grain exports says Brazil and Argentina will export 100 mil. bu. more corn and bean exports will be steady.
China is the soybean story according to marketing specialist Chad Hart at IA. He says most soybean importers have faded away, but not China, “At this point last year, China had purchased nearly 190 mil. bu. of soybeans from the US. This year the Chinese have purchased over 420 mil. bu. and we are only a few weeks into the marketing year.”
The latest USDA stocks report indicated year to year shifts in stored grain, says Hart. He notes, “On-farm storage of corn is up 22% from last year, while on-farm storage of soybeans is down 25%. Given the growth in on-farm stocks and the large corn and soybean crops being harvested, storage could be a major issue this year.” Read more.
Hart also says the moisture and quality issues will impact storage and marketing decisions. “As like last year, these crops will likely come out of the fields with more moisture than usual. Also, with the hail storms in north central and northeast Iowa this summer, we could see mold be more of a problem this year.” And Hart says farmers who cannot handle high moisture grain or quality issues will be selling, softening the basis.
Rethink grain price ranges says Hart at IA State, because USDA’s range of $3.05 to $3.65 for corn and $8.10 to $10.10 for soybeans takes into account grain that was forward contracted at higher prices, which raises the average. Hart says farmers need to look at the average futures prices, which currently forecast $3.20 for corn and $8.76 for beans.
Many marketing specialists have suggested storing corn to capture the carry and basis improvement and selling beans because of the lack of carry. MN marketing specialist Ed Usset agrees, but for farmers wanting more control of soybeans, he says re-ownership with a July call option has paid out profits in 7 of the past 8 years, but “an at-the-money July 2010 call will cost more than 80¢ per bu., and that past performance is no guarantee of future results. Read his rationale.
Cold air is pouring into the Cornbelt says IA meteorologist Elwynn Taylor, so expect development of patchy frost. He says the location depends on where there are clouds and wind, since clear skies will foster frost development. Taylor says recent fall rains have been welcome because the subsoil has been depleted of moisture and recharge is needed.
Heat units are needed for corn maturity, and without those, the corn plant will not go through the normal maturing process and it will dry up and die before it matures, says IA corn specialist Roger Elmore. He says some fields have not matured, but have dried down before the black layer was formed in the kernel, indicating normal maturity.
Some corn has also been pressured into an early maturity by diseases, such as northern corn leaf blight and GLS, as well as some droughty spots around the Cornbelt, says Elmore. He says those factors will reduce kernel weight and reduce quality. Many fungi will cause corn kernels to become “fluffy” and their test weight will be less. Elmore expects NASS statisticians could reduce the 187 bu. yield potential for IA this month.
If your corn is just not drying down, Purdue corn specialist Bob Nielsen says the issue could be the result of temperature, humidity, sunshine or rain conditions, as well as whether the hybrid was set to mature in August or September. He says it is not unheard of for grain moisture to decline more than 1 point per day when days are warm, sunny, windy and dry. But he says there may be zero drydown on cool, cloudy, and rainy days.
Corn drydown is a also a function of the hybrid’s physiological characteristics, says Purdue’s Nielsen:
1) Faster drydown comes with kernels that have a thinner pericarp or outer wall.
2) Faster drydown comes with ears that have fewer husk leaves.
3) Faster drydown comes with ears that have thinner husk leaves.
4) Faster drydown comes with ears have husk leaves that senesce or die sooner.
5) Faster drydown comes with ears whose husk leaves do completely cover the ear tip.
6) Faster drydown comes with ears whose husk leaves are looser.
7) Faster drydown comes with ears which drop down more quickly.
Your crop insurance may cover corn damaged from ear rots and other quality issues. IA ag economist William Edwards says you may be indemnified against low test weight, grade discounts, odors and other factors that reduce its quality from #2 yellow corn at 15% moisture. Alert your insurance agent and review Edwards’ value calculations.
If you have corn damaged by hail, mold, or other factors, call your crop insurance agent to determine the process of leaving field samples before harvest. IA ag engineer Charles Hurburgh and plant pathologist Alison Robertson suggest several steps for you to follow:
1) Scout fields for corn damaged by molds and call agent about quality loss procedures.
2) Take a composite sample from the field, test for toxins, and avoid long term storage.
3) Take load samples, ask for official test weight, grade them daily for inventory purpose.
4) Corn less than 50# is a storage risk and should be marketed first, but cool and dry it.
5) Moldy corn should be stored at moisture levels of 1-2% points below sound corn.
6) Clean any corn known to have toxins, remove center cores of bins to remove fines.
Do you have stalk rot problems? Scouting will help with the determination, but the 2009 weather was conducive to fungi that attack stalk integrity say NE specialist Tamra Jackson. She says, “On average, stalk rot diseases reduce yield by about 5% each year, although losses can be as high as 10% to 20%, and on rare occasion 100%. She says if more than 10% of plants exhibit stalk rot symptoms harvest that field first. And she adds, “Under severe stalk rot conditions, harvest early and pay the drying cost.”
Late planted soybeans should be scouted for soybean aphids. Midwestern crop specialists are finding significant numbers of aphids on soybeans that have not yet reached the R6 stage, which is full seed. Late planted and double cropped soybeans that still have substantial green vegetation would be attractive to soybean aphid colonies. Before spraying, assess the predator population and potential yield benefits.
The large number of soybean aphids heading from fields to their wintering grounds on buckthorn is telling OH insect specialists to expect soybean aphid problems next year and the end to alternating cycle of years of the extent of problems. They say that soybean growers should keep alert for an aphid issue in 2010 because of the current phenomenon.
Weeds interfering with harvest may be candidates for pre-harvest herbicide application to affect their seed production. IL weed specialist Aaron Hager says 2,4-D, Rage D-Tech, Glyphosate, and Gramoxone can be applied to nearly mature corn, with the proper interval prior to harvest, which is usually 7 days. Glyphosate, Gramoxone Inteon, Clarity, and Aim EW can be applied to soybeans with the labeled pre-harvest interval. Hager says pre-harvest herbicides may not do much to limit weed seed production.
Weed specialist Mark Loux at OH St. says another solution is to wait for a hard freeze and for the weeds to dessicate or become more brittle. He also suggests:
1) The greener the weed, the greater the likelihood of reducing seed viability.
2) Herbicides will be most effective when applied under warm sunny conditions.
3) Glyphosate can control perennials if they are in the appropriate growth stage.
4) Herbicides or a freeze will not force a loss of fruit on black nightshade.
Wheat being planted after corn or beans should have a good start in a weed free field says Purdue weed specialist Bill Johnson, who is concerned about weeds depleting moisture in a seed bed for wheat. He says there are only 2 broad spectrum herbicides labeled for planting wheat, glyphosate and gramoxone. He says if you have dandelions, or other perennials, use glyphosate, but both can be used for winter annuals. Johnson says 2,4-D is not labeled for fall use and can result in poor pollination and head fill. He also recommends suppression of henbit, purple deadnettle, chickweed, and dandelion.
USDA will update its small grains estimates for some northern states because harvest was delayed over a significant area of the northern Plains states. The last survey found unharvested acreage for durum wheat in ID, MN, MT, and ND. NASS will contact farmers who had unharvested acreage, and if changes are justified, the Sept. 30 Small Grains Summary of yields and stocks will be updated in the Nov. 10 Crop Report.
Is $60 per acre a good price for selling corn stalks, or will you leave financial benefits in the field? NE specialists say 1 ton of crop residue is created from 40 bu. of corn, 30 bu. of soybeans, or 20 bu. of wheat. Typical crop residue has 17 lbs. of N, 4 lbs of P, and 50 lbs of K per ton. At current prices that is $36 per ton. With stover removal, there is a loss of 4.3 in. of moisture, worth $17 per acre. There is also a drop of 25 bu. in corn yield or a 10 bu. drop in wheat yield. That means the loss is more than the selling price.
Have you noticed an increase in Northern Corn Leaf Blight? OH corn production specialists report a steady increase since 2001 in its occurrence. They attribute it to an increase in acres planted to hybrids that are susceptible, but say its late appearance this year was probably due to favorable weather conditions late in the growing season.
If more corn is grown to meet various demands, Purdue specialists say any effort to move toward continuous corn will result in more nitrogen, fungicides, and phosphorous showing up in streams and lakes than with a typical corn and soybean rotation. Purdue ag engineers studied water sources near continuous corn and rotational fields.
Statistically, we are in the last month in which diesel fuel prices will be less than they were 12 months earlier. Currently, they are about 16% less than a year ago, but prices in Nov. will be above the levels recorded when the oil market collapsed. Dec. should bring diesel prices 24% above Dec. of 2008, and spring tillage time will have diesel fuel 50% to 60% above spring 2009 levels, says economist Kevin Dhuyvetter at KS State. For budgeting 2010 fuel prices, read more.
Pork profitability may be reached next summer when the IA State “crush margin” for hogs reaches the $50 mark. That would be based on hogs placed in feeding barns in February and marketed in July of 2010. Review the IA calculations.
The IA State pork profitability model expects prices to exceed variable costs in March of 2010 and total costs in May of 2010. Economists John Lawrence and Shane Ellis say the accumulated losses over the past 2 years have exceeded the 27 months of losses that ended in Jan. 2000. Since there are more hogs now than then, losses per farm are more.
The Quarterly Hogs and Pigs Report did not include some substantial cutbacks in the breeding herd. MO economist Glenn Grimes says in the past 4 weeks sow slaughter is up 1.9% and gilt slaughter is up substantially. He says the Sept. 25 Hogs and Pigs Report was based on Sept. 1 numbers, and the cutback trend has increased since then.
Posted by Stu Ellis at 1:24 AM | Comments (0) | Permalink
October 1, 2009
Is There A Benefit To Livestock Producers For USDA Food Assistance Programs?
Livestock producers know it, and most other farmers are well aware that profitability for beef, pork, and dairy operations has been lacking for many months. That precipitated a call by dairy organizations for Congress to provide a $350 million aid package, which has now reached the point of agreement and may soon be called for a vote. The details include $290 million for producers and $60 million for purchase of surplus dairy products. But from that launching pad comes a request by the National Association of State Departments of Agriculture for a program to support meat producers and give it to domestic food assistance programs. If that happens, is there any long term benefit?
Advocates for a “Meat the Need” program say livestock producers did not get any benefit from economic stimulus funds that many industries have received from the US government, and it is hard to keep livestock operations going. The proposal would establish a federally funded buying program to deal with the oversupply of dairy, pork, and poultry industries. An example given by advocates sets the goal for the target weight of cheese to reach the $16 per cwt cost of production. Another example would call for pork to be purchased by USDA in 100 million pound segments until a target of $.49 cents per pound is reached in the pork market. Those stocks would then be channeled to food banks.
Would such a plan work and provide a long term benefit to the livestock industry? Several members of Congress wanted to know. Senators Bob Bennett of Utah and Kay Hagan of North Carolina and Representative Larry Kissell of North Carolina asked the opinion of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri for an economic analysis of the long term impact of such a program. With the livestock sector suffering from near record low levels of financial returns, several suggestions are being debated.
FAPRI economists looked at the displacement of commercial sales, which should be considered when federal donation programs are implemented. They additionally looked at the extent to which recipients of food donations cut back on their actual purchases. While there is known displacement of retail products, FAPRI says there is little information on how much demand is actually created. USDA economists report that in the early 1980’s they calculated that one dollar of donated cheese was estimated to lead to an additional 65 cents of cheese demand. Another economist found that food aid results in an increase demand that is 30% to 60% of the amount of the food aid, but a lot depends on the targeting of the aid.
The FAPRI economists evaluated the “Meat the Need” program, which involved USDA purchases of 225 million pounds of cheese over 4 months, a one-time purchase of 25 million pounds of nonfat dry milk, the purchase of 300 million pounds of pork over 6 months, and a one-time purchase of 100 million pounds of whole turkeys and turkey meat.
FAPRI says its calculations indicate that pork, turkey, and dairy products would all rise in price. Turkey would see a 9.2% price increase initially before prices fade over the next year. Milk prices would rise 9.4% as purchases continue and pork prices would increase 8.2% as purchases of pork continue. FAPRI says the positive effects of the proposal only last for the periods of late 2009 and the first three quarters of 2010 when the various purchases are scheduled.
Coincidentally, other commodities, such as beef, become beneficiaries of the program. FAPRI says fed cattle prices would rise 1.7% when the turkey purchases would be made by USDA. The increase in livestock and dairy production would increase feed prices, based on the premise that corn prices drop 35 cents and soybean meal drops $26 per ton when there is a 10% decline in feed use. FAPRI says the proposal results in a less than 1% change in the supply of meat and dairy products. However, USDA will be spending slightly more than $900 million to purchase that volume of meat and dairy products.
FAPRI says the bottom line is that, “Purchasing products from the market will increase prices for these products in the short run. However, in the long run, these programs will have little to no effect.”
Summary:
Advocates for the livestock and meat industries have called by Congress and USDA to purchase surplus products, donate them to food banks, and help raise the market prices for livestock and dairy. An economic analysis of the benefit indicates pork prices would initially rise 8%, turkey prices would rise 9% and milk prices would rise 9%, but would then fall back to prior levels after the commodities were purchased. There would be no long run benefit for commodity prices.
Posted by Stu Ellis at 12:02 AM | Comments (1) | Permalink
