FarmWeek October 4 2010 by Illinois Farm Bureau

PUMPKIN PRODUCTION is making a comeback this year with quality and supply better than last year, according to pumpkin processors. ......................................2

MAJOR GUBERNATORIAL candidates answer questions and discuss state issues in the first installment of candidate viewpoints. .............................................3

INFRASTRUCTURE needs for all modes of transportation must be considered, experts agreed at a transportation summit last week. ................................................4

Monday, October 4, 2010

Two sections Volume 38, No. 40

Analyst: Tax revenues don’t justify economic costs BY MARTIN ROSS FarmWeek

Periodicals: Time Valued

As Americans struggle with recession, a former Congressional Budget Office (CBO) director insists estate tax reform is “an important element of pro-growth tax policy” and could save millions of jobs. Under 2001 tax provisions, the federal estate tax “expired” at the end of 2009, but it will return at a $1 million pre-2002 exemption and a 55 percent tax rate unless Congress acts. That would prove “a severe blow to the economy,” Heritage Foundation senior tax policy analyst Curtis Dubay told FarmWeek. U.S. House Speaker Nancy Pelosi (D-Calif.) has pledged “America’s middle class will have a tax cut; it will be done in this Congress,” possibly as early as Nov. 2. However, it’s uncertain how the estate tax might be treated amid partisan debate over what constitutes a middle-class tax cut. Senate Ag Chairman Blanche Lincoln (D-Ark.) and Sen. Jon Kyl (R-Ariz.) seek a new $5 million estate tax exemption, with a 35 percent

tax rate. But many Democrat leaders instead support a return to 2009’s $3.5 million exemption to maintain estate tax revenues — a view Dubay calls “short-sighted.” In a 2005 CBO analysis, former CBO Director Douglas Holtz-Eakin projected the tax, which generated an annual $20 billion to $30 billion in revenues through its expiration last Dec. 31, could generate “roughly double that amount” over the next few years under reinstatement at pre-2002 levels. But in a new study for the American Family Business Foundation, Holtz-Eakin noted the U.S. “has endured a severe recession and is currently growing too slowly.” He said it is crucial policymakers focus on fostering the “maximum possible pace of economic growth.” Under current economic conditions, a 55 percent estate tax rate could cost 13.5 million U.S. jobs, he concluded. A return to original estate

tax levels also would reduce private capital outlays by 7.8 percent and greatly raise the minimum amount of return necessary to justify business investment, Holtz-Eakin stated. Slightly more than half the nation’s 120 million private sector workers work for small businesses, he pointed out. Dubay said he finds the lost revenue argument for returning to pre-2002 levels “disingenuous,” arguing economic growth would compensate for “death tax” revenues lost, especially given likely income through future capital gains taxes. Dubay noted the “step-up” in capital gains tax basis, in which inherited property rises to fair market value at the owner’s death, expired last year with the estate tax. “Step-up” was replaced by “carry-over basis,” in which the basis of property remains the same after death, potentially increasing the amount of gain and thus taxes when assets are sold.

“Estates don’t pass ‘taxfree’ when there’s no death tax,” he pointed out. “The heirs will have to pay capital gains on the entire accumulat-

ed earnings of an asset. “When you have this ‘modified’ capital gains/death tax system, the revenues are almost a wash.”

Heat, dryness drop yields in Southern Illinois BY DANIEL GRANT FarmWeek

While many Illinois farmers dealt with excess moisture this growing season — it was the sixth wettest summer on record in the state — some farmers in parts of Southern and Eastern Illinois had exactly the opposite problem. For them, Mother Nature basically turned off the water spigot after July. Topsoil moisture last week was rated 100 percent short or very short in Southeastern Illinois, 63 percent short or very short in Eastern Illinois, and 21 percent short or very short in the southwestern part of the state. “We’ve had hardly any measurable rain (since Aug. 1),” said Martin Barbre, who farms

in White County. “But what really hurt us more than the lack of moisture was the (excessive) heat. We were above 90 and 95 degrees for days and days.” Barbre reported some of his soybean crop simply died in the field. He recently harvested a bean field that averaged 16 bushels per acre. Meanwhile, much of his corn crop, which looked “excellent” in July, was unable to fill out. He recently harvested a field that averaged 110 bushels per acre. “It took anywhere from 15 to 30 bushels off the top of corn yields and probably 10 to 15 (bushels) off bean yields,” Barbre said. Jim Baker, who raises freerange poultry in Franklin

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County, said the hot, dry conditions were particularly difficult for livestock producers and their animals. Baker in recent months had to increase feed and water rations to maintain his flock. “It’s not a good situation,” he said. “I know a number of cattlemen who are concerned about where they’re going to get hay.” Overall, large portions of the southern and eastern Corn Belt are dealing with extreme dryness or drought while the northern portion of the Corn Belt in recent weeks experienced more flooding. USDA last week reduced the portion of the corn crop rated good to excellent by 2 points to a total of 66 percent. Twenty-one percent of the crop was

rated fair nationwide while the portion rated poor or very poor increased 2 points to 13 percent. Harvest last week continued at a rapid pace. As of the first of last week it was 57 percent complete on corn, compared to just 2 percent last year, and 22 percent of the soybeans were in the bin, compared to 1 percent a year ago. “If we keep this up, it will be my earliest harvest ever,” said Barbre, who projected harvest will be complete in his area by the middle of this month. Sorghum harvest in the state as of the first of last week was 32 percent complete compared to 1 percent last year while 8 percent of the winter wheat crop was seeded compared to 4 percent a year ago.

Illinois Farm Bureau®on the web: www.ilfb.org

FarmWeek Page 2 Monday, October 4, 2010

MARKETS

Quick Takes MONSANTO STOCK FALLS — Monsanto Co. stock dropped more than 13 percent last week amid reports the company’s new SmartStax corn seed has produced some disappointing yield results so far this harvest. Monsanto spokeswoman Kelli Powers told Reuters news service last week it was “still early” as only about 10 percent of planted SmartStax had been harvested. However, to offset any initial issues with SmartStax, Monsanto stated it would provide farmers not satisfied by the seed’s performance on their farms with an account credit for their 2011 seed purchases. Overall, Monsanto stock for the year, as of last week, had declined 44 percent, which reportedly was one of the largest declines by percent nationwide. Monsanto earlier this year lowered its profit outlook due to a price decrease for its glyphosate-based herbicides. IDOT, IDOA SAFETY REMINDER — The Illinois Department of Agriculture (IDOA) and the Illinois Department of Transportation (IDOT) reminded drivers to be alert for farm equipment on roads during harvest. “It’s very important that motorists be alert for slowmoving farm vehicles and share the roadway until the harvest is complete,” said Agriculture Director Tom Jennings. Last year, six people were killed and 95 injured in 198 accidents involving cars and farm equipment. From 2005 to 2009, there were 1,166 such crashes on Illinois roads, resulting in 21 deaths and 412 injuries. Studies show that left-turn, rear-end, and passing collisions are the most common types of accidents involving motorists and farm machinery. “Harvest is one of the busiest times of year for traffic on rural roads and, unfortunately, we see the number of crashes between motor vehicles and farm equipment peak during this time,” said IDOT Secretary Gary Hannig. ROCKEFELLER ROCKY? — Predictions that the White House would veto a two-year “freeze” on U.S. Environmental Protection Agency (EPA) greenhouse gas (GHG) regulations raised concerns about whether Sen. Jay Rockefeller (D-W.Va.) would stand by coal, producer, and other interests potentially affected by stringent new airquality restrictions. With legislation dead that would have blocked EPA from capping and penalizing emissions, Rockefeller’s proposal to at least delay the agency’s actions appears to be the best option for farmers who eventually could be wrapped into new rules that kick in in January. American Farm Bureau Federation public policy director Paul Schlegel agrees with Rockefeller’s assertion that President Obama would veto the measure if passed, but questioned the senator’s pessimistic view. “The prime, principal person who ought to be leading this charge looks like he has self-doubts — on a mission this important, you don’t want someone like Hamlet leading you,” said Schlegel, referencing Shakespeare’s insecure character. “You want somebody who believes in what they’re doing.”

(ISSN0197-6680) Vol. 38 No. 40

October 4, 2010

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A good harvest for commercial pumpkins, such as this past harvest scene in Mason County, is under way this year. Nestle/Libby’s in Morton, which produces and cans the majority of pumpkins in the nation, expects an adequate supply of the holiday favorite this year. Heavy rains last fall made harvest impossible for some growers and ruined much of the 2009 crop, which created a national shortage of canned pumpkins. (File photo by Ken Kashian)

In some locations

Pumpkin production bounces back BY DANIEL GRANT FarmWeek

The pumpkin shortage that made national headlines last year during the holidays appears to be coming to an end. The harvest of commercial pumpkins near the Nestle/Libby’s plant in Morton (Tazewell County) was about one-third complete as of the first of last week and the supply and quality of the crop so far appears to be sufficient to meet demand. “It (pumpkin harvest) is better than it was last year,” said Roz O’Hearn, spokesperson for Nestle. “We feel this year Mother Nature was much more cooperative.” Many farmers contracted last year to grow pumpkins near the Morton plant were unable to harvest their crop due to FarmWeekNow.com extremely wet A photo gallery on the 2010 p u m p k i n h a r v e s t i s a t conditions. The situation creatFarmWeekNow.com. ed shortages of canned pumpkins at some locations during the holidays, and the shortage that carried over into this year. “Normally, we have enough inventory from the previous year,” O’Hearn said. “But this year we had nothing. We had six cans left (prior to harvest).” O’Hearn said some shipments of processed pumpkins from this year’s harvest already have been completed and cans are on store shelves. Nestle, which produces and markets about 85 percent of the canned pumpkins nationwide and typically contracts about 5,000 to 6,000 production acres near Morton, this year increased its acreage to help cover the shortage from a year ago. Meanwhile, ornamental pumpkin growers this year have had mixed results in Illinois due in part to the wide range of weather condi-

tions throughout the season. In Morton, it’s been a bounce-back year for John Ackerman. “So far, things are going extremely well,” said Ackerman, who this year split his plantings, helping to extend his harvest. “We ended up with the best ornamental crop we ever had.” However, Ackerman has received calls from producers as far away as the Springfield area who need pumpkins to make up for a lackluster harvest. Carrie Winkelmann, a FarmWeek Cropwatcher from Menard County, is among the pumpkin producers who had some struggles this year. “Insect pressure and wet conditions have caused quality problems in the pumpkin patch,” she said. Overall, Illinois has about 25,000 acres of processing and ornamental pumpkins that produce a gross value of more than $160 million per year, which makes pumpkin production the largest vegetable industry in the state.

Pumpkin educational material available Illinois Agriculture in the Classroom (IAITC) is reprinting issues of the “Pumpkin Ag Mag.” Through this educational magazine, readers learn that Illinois farmers are the world’s top pumpkin growers. Other articles focus on the history of pumpkins and the importance of bees to help pumpkins grow. “The Pumpkin Ag Mag” is sponsored by the Illinois Department of Agriculture, the IAA Foundation, and IAITC. Ag Mags come in packages of 30 and are free to teachers. For more information, contact your local county Farm Bureau.

FarmWeek Page 3 Monday, October 4, 2010

STATE ELECTION 2010

Gubernatorial candidates answer questions The two major candidates for Illinois governor recently were interviewed by Illinois Farm Bureau media. Following is a partial report on their comments, with more to come in subsequent issues of FarmWeek. RENEWABLE ENERGY, STATE GOVERNMENT: State Sen. Bill Brady: “One of our failures has been that we have delayed the opportunity for businesses to invest in ethanol plants, or biodiesel, or other new technologies because the Sen. Bill Brady permitting process can take four to six months longer than a neighboring state. “By reorganizing state government we can make it business-friendly so that when you apply to make an investment in Illinois, we will process that application more readily than any other state and that will foster the re-engagement of that capital in Illinois. “When you lose an ethanol plant to another state, you not only lose the construction jobs, you not only lose the perma-

nent jobs, all important, but you also lose the value-added nature that facility provides the commodities we grow here in Illinois.” Gov. Pat Quinn: “We have passed a law in our state that 25 percent of our energy by 2025 will come from renewable sources. We have wind farms growing all across our state because we have good transmission (grid) on the east side of the Mississippi River. “We have the opportunity of not only supplying our own electricity needs in Illinois, but also the needs of Gov. Pat Quinn folks to the east of us. We could create jobs in Illinois and make money for people in our state. “We also have good solar energy. We have more usable sunlight in Illinois than they have in Los Angeles or Atlanta, Ga. We have fewer cloudy or smoggy days. There is great opportunity for green energy all over rural Illinois. “Part of my job as governor is to get the resources to build these wind turbines, to build these solar collectors, and defi-

nitely we want to work with ethanol and soy biodiesel. We have an opportunity to really expand our agricultural economy by using renewable resources for biofuel.” WHY SHOULD YOU BE THE GOVERNOR? Brady: “I’m not a true politician. I’m a downstater who believes that Chicago is important to the state, but the State of Illinois is important in all areas of the state, and I will represent the entire state. “I think for far too long our state has been controlled by insider politicians. We need an outsider to come in who has operated a business and understands what it’s like to be in a struggling industry like the housing market. “You know, several of our businesses are doing very well and some are struggling because of the economic times, and we need someone who understands what businesses are going through. “I think my business experience, my roots in downstate Illinois, will bring balance to state government. I hope (voters) will visit our website, {bradyforillinois.com}, and get engaged in this election. “This election is so important to the future of our state,

Editor’s note: This article is part of Farm Bureau’s Get Out the Vote Campaign. The goal is to encourage Farm Bureau members to become active in the political process and elect candidates committed to serving agricultural interests.

our country, and I look forward to working as governor to make us proud again of what our state is all about.” Quinn: “I’ve been working for citizens all my life. I’m a consumer advocate, a taxpayer advocate, and most importantly, a jobs advocate. I took office at the worst time, I think, in Illinois history. “We had a governor impeached and removed from office. I had to take over, restore integrity to the governor’s office, get our state economy moving again. “We’ve created more jobs than any state in the Midwest this year. We know we have a long, long way to go. You have an honest governor who knows how to get the job done. “We’ve brought some big businesses and small businesses back to Illinois to expand our economy. “I never ever will forget our farmers and our agriculture.

They are 40 percent of the economy. “If you look at my record as state treasurer, lieutenant governor, and governor, I understand downstate Illinois, rural Illinois, and definitely want to make the will of the people the law of the land.”

Vote by mail rules Registered Illinois voters may request a vote-by-mail ballot for the upcoming November general elections. This allows voters to vote at their convenience and mail in their ballots. All requests for a vote-bymail (absentee) ballot must be received by the Board of Elections by Oct. 28. The return ballot must be postmarked by Nov. 1. Voters should check with their county clerk for voteby-mail ballot applications.

Illinois high-speed Internet effort enters next phase More federal funds awarded BY KAY SHIPMAN FarmWeek

Illinois has moved to the next phase of connecting the state through high-speed Internet. The Partnership for a Connected Illinois, a non-profit organization, is working with state agencies, local governments, private industry, and other entities to coordinate broadband activities around the state, according to Warren Ribley, director of the Illinois Department of Commerce and Economic Opportunity (DCEO). Ribley outlined the state’s broadband status to the Illinois Broadband Deployment Council last week. “The state is on the cusp of fully realizing these (broadband) goals,” Ribley said. Council members also celebrated the state’s recent success in winning federal broadband funding from USDA and the U.S. Department of Commerce. (See the accompanying article.) In the second funding application round, Illinois adapted a strategy of regional collabora-

tion after learning the federal agencies were interested in larger combined proposals from states, said Lori Sorenson, chief operating officer of the state’s Illinois Century Network.

FarmWeekNow.com Check out the interactive map for Illinois to see if broadband is available at your farm by going to FarmWeekNow.com.

Sorenson explained Ryan Croke with the governor’s staff asked Illinois applicants to com-

bine their projects into a regional effort so as to avoid duplication of services and any overlap of territory. “Throughout the process, the federal agencies were excited that Illinois took leadership and promoted working together and sharing resource data and information” for its proposals, Sorenson said. “We have had other discussions of public and private entities doing projects and working together,” she added. Last week, the Partnership for a Connected Illinois, or

{broadbandIllinois.org} announced it will receive $4.7 million in federal funds from the Commerce Department to collect broadband data across the state. Previously, the state had received $1.8 million for broadband data collection. Earlier, Gov. Pat Quinn announced a Central Illinois broadband infrastructure project will receive more than $11 million from USDA. Project support includes $800,000 in Illinois Jobs Now! state funding along with private investment. This project is a public-pri-

Connecting Illinois update The following Illinois broadband projects have received federal stimulus funding. The types of projects, their coverage area, and total project costs include: Infrastructure projects: University of Illinois, Urbana-Champaign, $31.2 million; DeKalb County, DeKalb and LaSalle counties, $14.8 million; Illinois Century Network, East-Central Illinois, $96.38 million; Clearwave, Southern Illinois, $45.4 million; Northern Illinois University, Northwestern Illinois, $68.5 million.

Wireless projects: Cellular one, East-Central Illinois, $24.5 million; Utopian Wireless, Central Illinois, $1.3 million; Convergence Technologies, Cook, Kankakee, and Will counties, $12.13 million; Norlight, Central Illinois, $11.8 million. Last mile project: Shawnee Telephone, Pope County, $8.3 million. Statewide broadband data and development: Partnership for a Connected Illinois, $8.26 million.

vate partnership including the State of Illinois, local governments, Norlight Telecommunications, Motorola, and Royell Communications. It will expand a pilot project in Macoupin and Montgomery counties known as the Vince DeMuzio Rural Broadband Network to 11 new counties in Central Illinois. The expansion will create a 72-tower network, bringing new high-speed broadband service to Bond, Calhoun, Cass, Christian, Fayette, Greene, Jersey, Morgan, Pike, Scott, and Shelby counties. Job creation has been a major component of recent broadband announcements. During the council meeting, an audience member asked what was being done to ensure Illinois’ community colleges were preparing students for the types of jobs created by the new projects. Sorenson responded she would talk with the Illinois Community College Board and also with community college presidents about the skills needed for the new jobs. The governor’s staff also will talk with the union trade councils about employee skills needed for construction-related jobs, she said.

FarmWeek Page 4 Monday, October 4, 2010

GOVERNMENT

Diverse interests mobilize for infrastructure policy BY MARTIN ROSS FarmWeek

Agricultural, transportation, and shipping interests from across the state have begun mapping a course for federal infrastructure policy — and the means to fund it. During last week’s Midwest Agricultural Transportation Summit in Bloomington, Illinois Farm Bureau led development of draft policy recom-

mendations for improvements to the nation’s highway, rail, and river freight systems. Participants ranging from commodity groups, Cargill, and GROWMARK representatives to BNSF Railway, Transportation for Illinois Coalition, and the Chicago Metropolitan Agency for Planning officials urged Congress to consider infrastructure as a “holistic system,” moving both people and

goods and incorporating all modes of transportation. Funding for infrastructure improvements was a key focus of concern. Before the recession hit, “we were gung-ho to put some major projects into play,” Informa Economics Senior Vice President Ken Eriksen told FarmWeek. Amid the recent economic slump, government agencies, municipalities, ports, and others

Moving ahead: Multimodal/multi-agency Midwest Agricultural Transportation Summit participants support development of a national transportation policy that: • Considers the needs of both passengers and freight across all modes and connectivity between modes. Informa Economics analyst Ken Eriksen stressed “freight does not vote — people vote.” “We have to talk about both, to sell (transportation funding),” stressed Kent Schleich, chairman of Illinois Farm Bureau’s Farm Profitability Task Force. At the same time, Schleich emphasized the importance of a “complementary” system “where all the pieces work together.” Midwest Truckers Association Executive Vice President Don Schaefer noted the move toward containerized commodity shipping illustrates the growing “logistical” cooperation between rail, truck, river, and port interests. “We don’t look at a truck going necessarily from Bloomington all the way out to Los Angeles,” Schaefer told FarmWeek. “We may look at it going from Bloomington to Rochelle, where it’s put on a train and then taken to LA.” • Creates guidelines for federal, state, and local participation and encourages closer coordination among agencies. Schaefer sees the multimodal thrust necessitating greater interagency cooperation. For example, urban transportation efforts once directed by federal highway, transit, or aviation agencies increasingly may involve local

transit as well as state highway officials, he said. • Ensures global competitiveness. U.S. producers and exporters face key competition from Brazil, Argentina, China, and the former Soviet Union countries, “where ... they’ve shown they can produce,” Eriksen advised. Those countries have welcomed even foreign investment in bolstering highway, rail, river, and port capabilities. • Encourages exploration of public/private partnerships. Eriksen noted multinational companies are becoming involved in global infrastructure development. Rail interests at last week’s summit touted federal investment tax credits that could spur major improvements on private lines. • Streamlines project review and approval. Linda Wheeler of the Transportation for Illinois Coalition recognizes the need to “balance all concerns” — economic, environmental, and community — in designing road or lock projects. But “there’s something wrong when it takes 15 years to go from the time you begin planning a project to the point where you cut the ribbon and can use the project,” she said. “We have to find a way to shorten that time,” Wheeler told FarmWeek. “Time costs money, in terms of project inflationary costs. If we want to have an efficient system, we need to do the review and planning more quickly than we do it today. That involves a whole lot of agencies finding a way to do it better.” — Martin Ross

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“just ran out of money,” not merely sidelining infrastructure projects but canceling them altogether, Eriksen said. The economic recovery has revived freight demand and the call for cost-efficient transportation, but he warned that without cogent transportation policy, “We’re not going to be in a position to bring those (projects) back online.” “Our challenge is going to be how we find the wherewithal to be able to bring those back to the table and to be able to fund those things,” Eriksen said. “Without a competitive (infrastructure) system, we get higher freight rates. Higher freight rates create more costs

for the system, the infrastructure can’t handle the loads. Farmers start seeing losses in terms of (price) basis value, and they get a weaker and weaker basis to offset that higher cost within the system.” A $230 billion to $350 billion annual investment in U.S. surface transportation is needed over the next 30 years “to bring us up to speed,” Eriksen said. The rail industry has been investing $9 billion-plus per year in system upgrades, but he noted river and highway users “don’t have the same opportunity to invest,” relying instead on increasingly unreliable fuel taxes to leverage infrastructure funding (see story at left).

Innovative alternatives eyed for highway funding “Everything’s on the table” as shippers look at ways to keep agricultural and other goods moving on America’s roads and highways, according to Midwest Truckers Association Executive Vice President Don Schaefer. Schaefer reported his organization is seeking continued infrastructure investment and improvement through 2011 surface transportation reauthorization legislation, even amid “an awareness that everything comes at a price.” Illinois officials have outlined 83 proposed “congestion and expansion” projects designed to relieve gridlock, improve freight flow, generate jobs, access energy from a variety of sources, and connect communities. But beyond federal budget constraints, motor fuel tax revenues are falling increasingly short of meeting highway maintenance-construction needs. Informa Economics Senior Vice President Ken Ericksen noted U.S. annual highway miles driven continue to decline, and the federally powered push for increased fuel economy is likely to further erode fuel sales. As a result, the congressionally authorized National Surface Transportation Policy and Revenue Study Commission has put forward a range of possible new highway funding options ranging from increased private investment in surface routes to addition of new toll roads or even “hot lanes” that offer motorists speedier, congestion-free access for a fee. One of the more radical ideas floated by the commission is a “vehicle miles of travel” tax targeting consumer miles on the road rather than gasoline or diesel consumption. “There’s a lot of pressure coming from Washington and others as to how we’re going to fund this entire system,” Schaefer told FarmWeek at last week’s Midwest Agricultural Transportation Summit in Bloomington. “Are we going to look at new funding mechanisms such as a vehicle mile tax? Are we going to increase the federal motor fuel tax? Are we going to look at other (commercial) heavy-use tax increases? “I think everything’s on the table. Desperate times call for desperate measures, and I think we’re at that stage right now. The highway trust fund is taking a beating and has taken a beating, because this whole concept of how we fund our transportation needs has changed.” Federal failure to fund replacement of aging Upper Mississippi-Illinois River locks — improvements that require a 50 percent contribution from a similarly waning Inland Waterways Trust Fund — has prompted river shippers to support higher barge fuel taxes. Some highway funding options may address other issues such as the push for higher and/or uniform nationwide truck weights. Mike Steenhoek, executive director of the Soy Transportation Coalition, suggested President Obama’s proposed “infrastructure bank” could support rural innovations such as development of parallel “semionly” lanes or roadways designed for commercial weights. “Right now, 80 percent of the movement of goods from farm to initial delivery point occurs via semi,” Steenhoek pointed out. “Over the next 10 years, that’s going to increase to 90 percent.” — Martin Ross

FarmWeek Page 5 Monday, October 4, 2010

GOVERNMENT

‘All of the above’ offers energy opportunities BY MARTIN ROSS FarmWeek

Bill Foster is a Washington anomaly: a congressman cited for his work in physics, a House Democrat who is a “strong proponent of nuclear energy,” and a “cap-andtrade” critic. And the Rep. Bill Foster Batavia lawmaker and former Chicagoland Fermilab researcher is among those on the Hill who advocate an “all-of-the-above” approach to domestic energy policy. Foster admits his 2009 vote against House-proposed greenhouse emissions caps “got me in a certain amount of hot water with some of our leadership.” However, he sees the carrot — loan guarantees to spur “green energy” investment, and support for “longterm, revolutionary” research and development — as more potent than the regulatory stick. Foster supports nuclear power as a low-carbon option made safe through modern reactor/materials technology. “Clean coal” research offers a technology that can be sold to large greenhouse gas generators China and India, he told FarmWeek. “There’s a whole class of investments in green energy and particularly energy efficiencies that pay for themselves over the life of the equipment,” Foster said. “A generic example of that might be ‘ma-and-pa’ truckers stuck with a very

inefficient, old rig. “If a government loan guarantee would allow them to buy an efficient rig that saves them a lot of money over the lifetime of the equipment, that’s an example of government involvement that can get us over some of the failures of the system we have now. “These are things that are

FarmWeekNow.com Listen to Representative Foster’s comments on federal energy policy and directions at FarmWeekNow.com.

good for the economy, as opposed to certain things that have been proposed that are bad for the economy.” Continued dialogue with scientists has bolstered Foster’s support for efforts to kickstart next-generation ethanol development — “a very strong positive for energy policy.” Federal loan guarantees for ethanol pipeline construction would be money well spent, he said. Foster noted the seed industry’s intent to double corn yields over the next 20 years is a “rather frightening” prospect for producers without the ethanol industry to absorb the new production. He hails the economic value of distillers dried grains (DDGs) and seeks to ensure the ethanol co-product’s grain displacement value is “properly documented into (ethanol’s) carbon footprint.” “The carbon footprint for corn-based ethanol is very positive, which wasn’t the case 10 years ago when you looked at old ethanol plants and ignored the value

of DDGs,” he related. “If you look at analyses of modern plants, you see a

whole different story. “Getting that message out to all of Congress — what a

positive environmental benefit ethanol has — is one of my key roles in Congress.”

FutureGen funds locked in Ameren spokesman indicated the company It may seem a bureaucratic formality, but Illinois interests were buoyed last week by the likely would approach the General Assembly federal government’s financial commitment to during the second phase of plant retooling for “FutureGen 2.0.” “a cost recovery mechanism.” U.S. Energy Secretary Steven Chu formally Illinois Coal Association President Philip committed $1 billion in federal stimulus funds Gonet, a self-proclaimed “cheerleader” for to the long-delayed, revised project. FutureGen and other clean coal projects, was Under FutureGen 2.0, carbon dioxide (CO2) warily optimistic last week. would be transported from Ameren’s idled “I’m aware of all the requirements the folks Meredosia power plant through a projected at Mattoon had to go through for the Future175-mile pipeline for underground storage ten- Gen site there,” he told FarmWeek. “It would tatively in East-Central Illinois. The Department of Energy (DOE) and Ameren ‘ It would amaze me if all the issues were agreed to a plan to retool the covered with FutureGen 2.0. I don’t see Morgan County plant with this happening really quickly.’ oxy-combustion technology, which uses superheated oxygen to burn coal with reduced — Phil Gonet emissions. DOE and the President, Illinois Coal Association FutureGen Alliance, a publicprivate partnership that includes utility, coal, and other interests, amaze me if all the issues were covered with signed a $553 million cooperative agreement. FutureGen 2.0. I don’t see this happening really Under federal budget requirements, DOE quickly.” was obliged to lock in federal project funding Gonet was disappointed by DOE’s shift from before Oct. 1. U.S. Sen. Dick Durbin, a Spring- a new plant employing a pioneering coal “gasififield Democrat, nonetheless hailed DOE’s cation” process to oxy-combustion technology commitment as answering “any remaining seemingly “more in line to adapt to an existing question as to whether FutureGen is really power plant.” He noted significant private intercoming to Illinois.” est in gasification, and although DOE’s current Mattoon was selected for CO2 storage and a clean coal strategy includes some Pennsylvanianew coal-fired power plant under the original based gasification research, he believes the origiFutureGen plan, but it withdrew after DOE nal FutureGen plan would have accelerated decided to go instead with Ameren’s existing plant and relegate the Coles County site strictly investment in the fledging technology. With nearly 80 percent of the coal mined in to carbon “sequestration” and related worker Illinois currently shipped out of state, he said he training. was excited over gasification as a route to using More than two dozen Illinois communities more Southern Illinois high-sulfur coal in-state. have expressed interest in hosting the storage facility, reportedly including Decatur, Marshall, However, either gasification or oxy-combustion will accommodate high-sulfur coal use, Gonet Springfield, Taylorville, and Tuscola, as well as said. McLean County. “That’s the silver lining,” he said — Martin Illinois lawmakers may have to agree to Ross added state-level funding for the project: An

Illinois corn, wheat growers ACRE-eligible With Illinois corn and wheat producers in line for 2009 average crop revenue election (ACRE) payments, 2010 ACRE apathy could give way to renewed ACRE activity in 2011. September release of National Agricultural Statistics Service 2009-2010 marketing year average prices — the final data needed to calculate state eligibility for ACRE payments on 2009-harvested crops — indicate Illinois corn, wheat, and oat growers may receive ACRE checks this fall. Illinois Farm Bureau risk management specialist Doug Yoder sees the greatest likelihood of corn payments being made “wherever the water was a problem.” However, Illinois soybean growers are not eligible for initial ACRE payments.

Payment eligibility includes three components: national crop price, a state revenue trigger, and farm-level losses based on revenue benchmarks combining past yield history and national prices. Illinois growers with 2009 losses beyond the farm trigger will be eligible for payments based on state revenue losses of $25.17 per acre for corn, $89.42 per acre for wheat, and/or $55.97 per acre for oats. Farmer payments are calculated by multiplying state revenue losses times a farm/state yield ratio. Eligible producers will be paid on the lesser of 83.3 percent of individual planted acres or base acres. “I think there’s a good chance wheat farmers who signed up for ACRE in ’09 will be eligible,” Yoder said. “But only 10 percent of eligible wheat farmers in the state signed up.

“Roughly 20 percent of Illinois corn growers signed up. I think there’s a good chance for them, but it’s going to be a little more sporadic depending on location, relative to wheat, but we certainly had our problems last year. “Last growing season (2009), we had excessive water early that led to planting delays, replanting, and some prevent-plant situations. “Moisture also led to delayed harvest conditions.” In addition, producers who purchased crop insurance for 2009 crops are more likely to trigger payments because policy premiums are incorporated into individual calculations. However, the state’s USDA Farm Service Agency noted payments originally expected to begin this week now more likely will reach eligible farmers in late October.

Yoder reported an “extremely small” ACRE signup across Illinois this year, as growers waited to see how the program addressed 2009 losses. Next year’s signup will be “the first after actual checks have been disbursed,” and he suggested first-time payouts could spur greater program confidence. “We’re building the 2010 (ACRE) price as we speak,” Yoder added. “We’ll have to pay attention to this year’s market. If we continue to rally, as we have so far this fall, that will give us a higher revenue guarantee next year. That may entice additional signup, also. “Typically, the higher the benchmark, the more you’re guaranteed, the more attractive this program will be, and the more likely you are to trigger.” — Martin Ross

FarmWeek Page 6 Monday, October 4, 2010

CROPWATCHERS Bernie Walsh, Durand, Winnebago County: It was full steam ahead for harvest here last week with almost ideal weather, no rain, and sunny skies. Most farmers who have beans are combining them and finding good moisture levels and very good yields. The sudden death syndrome fields are pretty disappointing, but most of the beans are yielding better than they have for years. The corn also is very good, with drier moisture levels every week and very good yields. The test weight issue from hot summer nights has not been as bad as we thought it would be. Have a good week and stay safe.

Ron Moore, Roseville, Warren County: We received 0.7 of an inch of rain on Sept. 25 and have had no rain since. There is not much corn left in this area. We have about one week of corn left, but we switched to soybeans on Thursday. We don’t have any whole-field averages yet. The yields appear to be very much like the corn, highly variable. The heavy rains in May and June hurt the yields in the low areas, but the rolling ground is yielding well. The forecast is for a prolonged period of dry weather so we should make great progress toward finishing in two to three weeks.

Pete Tekampe, Grayslake, Lake County: We started cutting beans on Sept. 26. Moisture was 12 percent and yields were in the 50s. There was no rain during the week and harvest went well. We planted some wheat Thursday and had great conditions compared to the mud we planted in last year. About a third of the beans are combined. Corn seems to be drying well. Be careful and have a great week harvesting.

Jacob Streitmatter, Princeville, Peoria County: A nice week let the combines work hard. The ground is getting dry, which makes it a lot easier to get the grain out of the field. The corn crop is disappointing but the soybeans have been better than expected, for the most part. Corn harvest is racing toward the finish line, but soybean harvest just began last week. Have a safe week.

Leroy Getz, Savanna, Carroll County: Gorgeous fall harvest weather has really put farmers in high gear. Dry fields, dry corn at 15 to 18 percent with little or no LP needed. My yields are equaling close to last year’s record but it’s 10 percent drier. Only a few soybeans were cut last week. We have heard of several field and equipment fires, so please be careful. Ron Frieders, Waterman, DeKalb County: So far this harvest is the earliest and fastest I can remember. Harvesting in short sleeves sure beats insulated coveralls. A string of sunny, warm days has three quarters of soybeans in the bin. Most farmers are happy with the yields and quality. Corn harvest has been hurried along by the weather and the early dry-down of this year’s crop. Yields are disappointing and much more variable. Some corn has average yields and some is well below average. Remember to stay safe. Larry Hummel, Dixon, Lee County: Great weather for soybean harvest last week. The only thing that would have made it better would have been some wind at night so we could have run a little later into the evening. Yields for soybeans continue to run well above average. One variety of Dairyland beans has out-yielded other beans by 8- to 12-bushels per acre in side-by-side checks. We are right at our five-year average, but we haven’t harvested a whole lot, either. In our first yield check for an application of fungicide on corn showed it increased the yield by 9 bushels. The real difference was in the standability of the corn. This year, that might be worth more than the extra 9 bushels. Joe Zumwalt, Warsaw, Hancock County: While the rains last week slowed harvest progress a bit, we are still moving along at a record pace. We have only 80 acres of corn left and have started to cut some soybeans. Eighty percent of the corn is shelled in my immediate area. Only a few select fields of soybeans have been cut. Corn yields have been disappointing, My farm average should come in just about 10 bushels off of my 10year average. The soybeans we have cut so far have been very promising and are yielding in the mid- to upper 50s. We are all very thankful for the dry weather in the forecast. It seems like forever since we have had a weather outlook this favorable. Ken Reinhardt, Seaton, Mercer County: Harvest is rolling again after we received more than 4 inches of rain. I’ve heard of a couple of stuck combines, but for the most part, the going is pretty good. I did a couple of corn-on-corn fields that had decent yields, but many are thinking of going back to corn/soybean rotations. I’m in my first beans in Rock Island County and they look to be very good. There was a possibility of frost during the weekend, and there are still some late-planted beans that could be affected.

Tim Green, Wyoming, Stark County: Very nice, pleasant week. Corn is probably 65 to 70 percent complete. Beans probably are in the 25- to 30-percent range. Yields have been everywhere with some lower 25- to 30-bushel yields on the corn. Bean yields have been surprisingly good. We will see if we get any later-planted beans with higher yields, but so far people are really happy with their bean yields. A little fall tillage is getting done. The last couple years we haven’t gotten much fall tillage done, but this year I think everyone is making sure they get it done. I picked corn Thursday in the 14.5- to 15-percent range. That was a little different than last year. Last year, we started harvest Oct. 12. This year, I don’t know if we will be done by then, but we will be close. Mark Kerber, Chatsworth, Livingston County: Great weather to be harvesting. Dry ground makes it go much better. This past week was one of harvesting soybeans. We could put the soybean platform on and just go. Last year, the elevators were full of corn. This year, they are filling up with soybeans. There seems to be more fall tillage this year, as farmers have time to chisel out last year’s compaction and put some air back into the soil. It’s also nice to get the fertilizer worked in where the roots can use the nutrients. Have you noticed small, round areas in the middle of soybean fields with no beans? They all have ground squirrel holes. Didn’t know they liked to eat soybeans. Markets are backing off some from recent highs. Ron Haase, Gilman, Iroquois County: Harvest has progressed rapidly. Eighty-five percent or more of the crops have been harvested in this area. Due to the much lower corn yields, harvesting each field takes less time and there was less congestion at the elevator. Also, there will not be nearly as much corn stored in outdoor piles this year. Corn in the field did not dry down much until the dry and windy weather returned on Thursday. There is about an equal split between the number of corn and soybean fields that remain. Fifteen percent of the ground already has been worked. The local closing prices for Sept. 30 were: nearby corn, $4.64, January corn, $4.81, fall 2011 corn, $4.37; nearby soybeans, $10.73, January soybeans, $11.02, fall 2011 soybeans, $10.38. Brian Schaumburg, Chenoa, McLean County: Another dry week brought harvest to more than 95 percent complete on corn and 80 percent on beans. Overall, bean yields are good (mid-50s to 70) but there are places that suffered from the lack of an August rain. Even ardent no-tillers are contemplating tillage. Others debate what type, how much and how deep. Corn, $4.68, January $4.36; fall 2011 beans, $10.72, January, $10.40; fall 2011 wheat, $6.13.

Steve Ayers, Champaign, Champaign County: The golden piles of corn are popping up like mushrooms. In our little corner of the world, we are closing in on 90 percent corn harvest completion and 60 percent soybeans harvested. We wrapped up corn harvest last Saturday (Sept. 25) and began on beans. With our corn harvest completion once in February 2010 and again in September, we feel like Brazilian farmers. Textbook harvest weather is expected to continue with a frost threat early in the week. A man recently was arrested in Royal for anhydrous theft, so let’s be careful out there. Wilfred Dittmer, Quincy, Adams County: Another nice fall morning here Friday with the temp at a cool 45. We did receive about 0.2 of an inch of rain last Saturday evening (Sept. 25) which brought the total here to about 5.65 inches for September. We’re busy watching the grain go from field to bin and the pace continues. Corn harvest may be approaching 50 percent with several fields still untouched and bean harvest just getting under way. Early bean yields are very good where they were not in the ponded areas. There’s still a long way to go to the finish line, so do be careful. Carrie Winkelmann, Menard County: Harvest was going gangbusters this past week. Everyone is out taking advantage of the good, dry weather. Even though it has been dry, fields are still soft, and we are unable to pull the semi into the fields. It is firming up and hopefully will continue to get better as we switch to beans. In my area, I would guess that about 75 percent of corn is harvested as of this report. Many are finished with corn and have moved on to soybeans. We soon should finish with corn. Corn yields have varied and for the most part are on the low side. The variation in yielding varieties geographically is making it hard to figure out what caused poor yields and is making the decision on varieties for next year extremely hard. We are excited to get into beans as high yields are being reported in our area. Tom Ritter, Blue Mound, Macon County: Harvest is winding down rapidly after a beautiful week of pleasant temperatures and plenty of sunshine. A lot of soybean cutting is going on with early starts and being able to run fairly late. Corn harvest is more than 90 percent complete. Very few fields on corn can be found. Soybean harvest is at least 70 percent complete. Corn yields were all over the board with some excellent corn and pockets of corn that really took it on the nose, especially in fields with poor drainage or those that had a lot of nitrogen loss. Soybeans have been the pleasant surprise. A lot of beans in the 70s or close to it. Occasionally you hear reports of even up into the 80s. Farmers are very pleased. A lot of tillage has been done, and everyone is pleased that we are so far ahead of last year. Todd Easton, Charleston, Coles County: The fall work season hit its stride last week as producers took full advantage of the ideal conditions to get a lot of work done. Corn harvest is all but done, and on average, the yields were mediocre compared to the last couple years. Soybean harvest seems to be nearing the halfway mark and bean yields turned out to be the pleasant surprise of the year. Many fields are yielding in the mid- to upper 60s and a few are making it above the 70-bushel mark. Alongside the combines farmers and service companies are running tillage tools and spreaders hard and catching up on a lot of work that couldn’t get completed after the difficult season last year. Rick Corners, Centralia, Jefferson County: Bean harvest is getting cranked up and yields are surprisingly good with what they went through. After last year, I hate to say this, but we could really use a good shower.

Page 7 Monday, October 4, 2010 FarmWeek

CROPWATCHERS Jimmy Ayers, Rochester, Sangamon County: Our place received 0.15 of an inch of rain in separate events last week. Some areas received 0.4 of an inch. Corn probably is 75 percent done, but there are quite a few beans left. Beans may be up to 30 percent done. Our beans are running anywhere from 51 to 74 bushels per acre. A lot of people seem to be happy with their beans yields. Most of them won’t talk about their yields, though. I don’t know if that is a good sign. Normally, when they don’t talk about it, the yields are not as good as what they expected. Fieldwork is progressing in some areas. Most of the people have been focusing on getting the crop harvested. Be careful. Doug Uphoff, Shelbyville, Shelby County: Wow! 130 acres of beans left and we are done with 2010 harvest. Beans in our part of the county are running 50 to 60 bushels per acre depending on how much ponding occurred this summer. Corn yields were 30 to 40 percent below average for the same reason and from the extensive heat. Cornfields are chiseled and fertilizer and lime already have been applied. Now we will have to be patient to apply anhydrous, but it is giving us time to work on tile problems and drainage issues. Over by Gays and Windsor yields were tremendous in corn — 210 to 220 bushels per acre. Good yields also were found to the south and west (Owaneco area) where ground had some roll to it. We had some farms where gross dollars on the beans were well above those for corn. Be safe out there and have a good week.

Reports received Friday morning. Expanded crop information available at FarmWeekNow.com

David Schaal, St. Peter, Fayette County: Here we are the first of October and corn harvest in the area is pretty well complete. It was another rain-free harvest week. Soybeans are disappearing in a hurry. Producers are able to keep cutting beans or they cut and wait a day or two for later-maturing beans to get ready or later-planted beans to get ready. Some wheat sowing is going on with a report of some wheat already having emerged. A lot of bean yields in this neck of the woods are 50 to 60 bushel per acre, which is better than we anticipated. Grain markets last week made some corrections. We will see what happens. Good luck with harvesting. Ted Kuebrich, Jerseyville, Jersey County: The weather in Jersey County has been perfect for harvesting corn and beans. Farmers in Jersey County are either done with corn or are about to finish. The bean harvest is getting well under way with yields coming out around 50 to 70 bushels per acre. Moisture is running at an average of about 11 percent. Fall tillage also has started. Prices at Jersey County Grain, Hardin: cash corn, $4.58; January 2011 corn, $4.85; September beans, $10.77, October beans, $10.82, January 2011 beans, $11.18. Dan Meinhart, Montrose, Jasper County: It was a mostly sunny and pleasant week with some very windy days. Harvest of May-planted corn is moving along rapidly but some of it is still carrying moisture. Yields are all over the board depending on how much water damage there has been. Bean harvest is in progress, but most fields are a week or more away from being ready. Good yields are being reported. Some wheat sowing is taking place. Forecast is for some warming this week.

Kevin Raber, Browns, Wabash County: Another month is gone from the calendar. The days are cooler, but the ground is just as dry. Harvest is in its last stages. I will be done within a week if no problems arise. The old saying is, “Sow your wheat in the dust, and your bins will bust.” We had the first part, now we’ll have to see if it comes true. Dean Shields, Murphysboro, Jackson County: Had a beautiful week for harvesting and we got a lot done. I said earlier the corn crop is pretty well done in Jackson County. It seems as though it is except for those picking up some free storage by leaving it out in the field. Bean harvest is coming along. Yields have been all over the board from not so good to very good. I had one report that the milo crop wasn’t so good. A lot of wheat was sowed in the last week, and it seems as though our wheat acreage will get back up to normal this year. The southern part of Jackson County has a lot of orchards, and the fruit crop is looking real good for peaches and apples. The pecans in this area are doing really well, too. Everybody have a safe harvest. Ken Taake, Ullin, Pulaski County: I had a good week for harvest here in deep Southern Illinois. We did have a few light showers Sunday night (Sept. 26), but it only amounted to about 0.2 of an inch, and we were back to cutting soybeans by Monday afternoon. We are almost half finished with cutting our soybeans. Yields are down, running in the upper 30s to low 40s. Area farmers are getting ready to start planting wheat. Please remember to be careful in this busy harvest season.

Dicamba-glyphosate combo works well in resistant soybeans Soybeans resistant to the herbicides dicamba and glyphosate performed well in field tests with weeds that have become resistant to glyphosate alone, according to recent Purdue University research. Bill Johnson, a Purdue weed science professor, said dicamba has been known to work well on weeds that appear in soybean fields, but it had to be applied to the ground long before soybeans were planted because the beans also were susceptible to the herbicide. However, a new dicambaresistant soybean, which also is resistant to glyphosate, can handle an application after planting, according to Johnson. “This is a powerful postemergence herbicide that we can pair with glyphosate to kill glyphosate-resistant weeds,” Johnson said. More than 90 percent of soybeans and corn planted in the U.S. have been engineered to be resistant to glyphosate. But overuse of the herbicide has created glyphosate-resistant weeds that can lower crop yields. “We have created an environment that has selected for glyphosate-resistant weeds,” Johnson said. Johnson used field tests

from 14 locations in Georgia, Illinois, Indiana, Kentucky, Missouri, Nebraska, North Carolina, Ohio, South Dakota, and Tennessee to evaluate dicamba’s effectiveness on broadleaf weeds before and after soybean planting. His study showed that dicamba applied just before planting provided 97 percent control of common lambsquarter and horseweed three weeks after treatment, but was slightly less effective on smooth pigweed, giant ragweed, velvetleaf, palmer amaranth, waterhemp, and morning glory. Dicamba treatments postemergence improved control of velvetleaf, smooth pigweed, morning glory, and waterhemp. When combined with glyphosate, dicamba gave 30 percent to 65 percent better control over glyphosate-resistant palmer amaranth, waterhemp, horseweed, and giant ragweed compared to glyphosate alone. Johnson said he plans to continue to study dicambaglyphosate uses to understand how the combination can be best used in different conditions and situations. Roundup manufacturer Monsanto, which donated seeds for the study, partly funded his research.

Purdue University researcher Bill Johnson has shown a combination of glyphosate and dicamba used with dicamba-resistant soybeans gives better control of glyphosate-resistant weeds. (Purdue Agricultural Communication photo)

Dixon Springs to host Sustainable Living Expo The University of Illinois Dixon Springs Agricultural Center in Pope County is hosting the Sustainable Living Expo from 9 a.m. to 4 p.m. Saturday. The event has been designed to appeal to all ages, all income levels, and all “shades of green,” according to Expo steering committee chair Stephanie Brown. She is the USDA Natural Resources Conservation Service coordinator for the Shawnee Resource Conservation and Development (RC&D) Area. The RC&D led

planning efforts. Attendees can learn everything from basic gardening to living “off the grid” to proper tree care. Program tracks include locally grown foods, energy, conservation, and survival tips. Five tents will feature concurrent presentations, while 30 outdoor learning stations will be led by experts. Additional programs and ongoing demonstrations will occur in the Ag Center buildings. Individuals planning to attend the free event are asked

to register in advance so vendors will have enough food for participants. To register, go online to {www.shawneercd.org} or call 618-993-5396, extension 6. Registration also may be done on site, the morning of Oct. 9 by checking in at one of three information tents at parking shuttle stops. Dixon Springs Agricultural Center is located on Illinois Route 145 in Pope County, four miles north of the intersection with Route 146, or 25 miles south of Harrisburg.

FarmWeek Page 8 Monday, October 4, 2010

GOOD NEIGHBORS

At left, Dorland Smith of Havana signs a get well poster for Easton farmer Jay Frye who has been hospitalized since early September with acute pancreatitis. Some 75 Mason County farmers last week combined 450 acres of corn for fellow farmer Frye. Mason County Farm Bureau manager

Dee Dee Gellerman and farmers Kraig Krause and Jeff Smith organized the harvest effort that involved 10 combines, 11 grain carts and tractors, and 20 semi-trucks. At right: Randy Fornoff of Havana, vice president of the county Farm Bureau, drives a combine through one of Frye’s fields.

Farmers lend helping hand Agriculture is a competitive business, but when a farm family needs help, fellow farmers always are the first on the scene to provide it. Such was the case last week as 75 Mason County farmers combined 450 acres of corn in 4.5 hours for fellow farmer

Jay Frye of Easton. Frye has been hospitalized since early September with acute pancreatitis. Massive undertakings similar to the Mason County effort are common each season as farmers often organize group planting or harvest days to

help fellow farm families through sickness, the loss of a loved one, or other difficult times. It’s good to know neighbors always are at the ready to help when needed, but sad to know such help is needed virtually every year.

David Behrends, right, with Sunrise Ag Service Co. chats with Don Friend after refueling Friend’s tractor. Sunrise donated diesel fuel for harvest equipment during the day. Friend was prepared in case any equipment got stuck in the field. For additional photos, see Ken Kashian’s photo galleries online at {www.ilfb.org}. (Photos by Ken Kashian)

FarmWeek Page 9 Monday, October 4, 2010

PRODUCTION

Rise in stocks could cause corn market to wilt BY DANIEL GRANT FarmWeek

An unexpected boost to ending stocks last week could sap strength from the corn market. USDA surprised many traders last week when it reported corn stocks as of Sept. 1 totaled a robust 1.708 billion bushels compared to the average pre-report estimate of about 1.4 billion bushels. The additional 300-plus million bushels of corn reportedly in storage nationwide is equivalent to increas-

ing the national average corn yield by about 4 bushels per acre, according to Dale Durchholz, AgriVisor Dale Durchholz market analyst. “It is a significant number,” Durchholz told FarmWeek. “It makes it more difficult for people to build a bullish argument in the marketplace.” Durchholz believes pressure on the corn market could

cause speculative fund managers to retreat from the market as steady buyers and liquidate their long positions. “The knee-jerk reaction (to the USDA stocks report) certainly is bearish,” said Darin Newsom, DTN market analyst. “This could lead to some pretty heavy selling.” Corn and wheat futures prices after the release of the USDA report declined by about a dime per bushel. Wheat stocks, at 2.459 billion bushels, also exceeded prereport estimates. The stocks-to-use ratio for

corn, boosted by the larger inventory, now sits at about 12.5 percent compared previous projections of about 10.3 percent, according to Newsom. “With the adjustment (to ending stocks), it’s still tight,” he said. “But it’s not as dramatically tight as it could have been.” The crop markets, which recently reached two-year highs, likely won’t give back all of the previous gains. Durchholz believes end-users will take advantage of the price break and re-enter the market

to extend their coverage. “Can we reinvigorate spec buying enough to carry the market higher?” he said. “That’s the big question right now.” Soybean stocks as of Sept. 1 totaled 151 million bushels, which was in line with prereport estimates. However, a record crop could pressure bean prices. “We are in the throes of harvesting an extremely good soybean crop,” Durchholz said. “I have to question the market’s ability to hold the $11 level.”

USDA Economist: Food prices expected to edge higher Consumers may be asked for more “paper or plastic” to pay their grocery bills in the coming year. USDA recently reported the consumer price index (CPI) for all food in August increased 1.1 percent compared to the previous year. And food prices the rest of this year and into 2011 are expected to edge even higher due in part to tight supplies and rising prices of commodities. “As we’ve gone from summer into fall, we’ve seen some pressure from commodity prices,” said Ephraim Leibtag, USDA senior economist. “It hasn’t had a major impact on retail prices yet, but I think it will lead to some accelerated inflation.” Corn, soybean, and wheat prices since August surged to two-year highs as production concerns have popped up around the world. USDA recently lowered its corn yield forecast, Russia this summer banned grain exports due to crop losses from a widespread drought, and

‘ We’ve seen some pressure from commodity prices.’ — Ephraim Leibtag USDA senior economist

heavy rain in Canada is expected to cut grain yields there. Meanwhile, retail food prices in August compared to the same time last year increased 5 percent for beef, 7.6 percent for pork, 3.3 percent for dairy products, and 0.7 of a percent for poultry as overall supplies dwindled. Cattle and hog prices in recent months approached or set new contract highs. “Meat prices have rallied, and it’s gone through to the retail level already,” Leibtag said. “We may see some substituting (of protein sources) if we see a sustained differential” between the price of beef and pork compared to poultry.

Overall, Leibtag predicted the CPI for all food next year may increase by 2 to 3 percent, which is considered standard food price inflation. Food prices prior to the recent run-up actually declined from September 2009 to February 2010, which was the first such decline since 1959. “Inflation in 2011 likely will be higher than in 2010 or 2009” and closer to normal levels, Leibtag said.

The economist sees no signs of another price runup similar to 2008, when food prices skyrocketed after oil prices peaked at an alltime high above $147 per barrel. Hafez Ghanem, assistant director for economic and social development at the United Nations Food and Agriculture Organization (FAO), agreed the outlook for food availability and

prices likely will not approach the extreme levels of 2008. “The market fundamentals are sound and very different from 2007-08,” Ghanem stated on the FAO website. “We don’t believe that we are headed for a new food crisis.” Ghanem noted that despite the wheat shortfall in Russia, the world cereal harvest this year was the third-largest on record. — Daniel Grant

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FarmWeek Page 10 Monday, October 4, 2010

EDUCATION

FFAâ&#x20AC;&#x2122;ers challenged to create ag career campaign for teens Teenagers know best what interests their fellow teens, and those insights are being tapped to create a campaign to interest students in agricultural careers. The Illinois Farm Bureau and Affiliates Youth Education Committee is offering FFA chapters across the state a one-time opportunity to develop an ag career campaign. The FFA chapter with the top campaign will receive $1,000. â&#x20AC;&#x153;We recognize in this day and age that students need something to capture their attention,â&#x20AC;? said Mariah DaleAnderson, IFB youth activities manager. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a youth campaign developed for youth by youth.â&#x20AC;? A total of 30 chapters will be accepted in the competition on a first-come, first-served basis. The deadline for submitting proposals is Nov. 1. Each chapter must develop a campaign about agricultural careers with high school students as its target audience.

â&#x20AC;&#x153;We would like them (the campaigns) to be digital, especially with videos,â&#x20AC;? Dale-Anderson explained. For example, FFA members could interview people in agricultural careers or interview fellow students about their perceptions of agricultural careers. For participating chapters, some funding for supplies and equipment, such as a camera, will be available to create a campaign.

â&#x20AC;&#x2DC;We recognize in this day and age that students need something to capture their attention.â&#x20AC;&#x2122; â&#x20AC;&#x201D; Mariah Dale-Anderson IFB youth activities manager

In addition to the creative material, each chapter will need to submit a written report about its information

and why agricultural careers are appealing to young people. Chapters with the top 10 campaigns will be selected to

present reports on their campaigns at the state FFA convention in June. At that time, the winning campaign will be determined. Information about the contest and the entry forms are available online at {www.youthed.org} and linked to the youth ed Facebook page at {www.facebook.com/ilfbyea}. Dale-Anderson may be contacted at 309-557-2350 or by e-mail at mdale-anderson@ilfb.org.

DOE grant enhances SIU energy crop research The College of Agricultural Sciences at Southern Illinois University (SIU) at Carbondale is using a $492,000 grant from the U.S. Department of Energy (DOE) to scale up its research on energy crops. The grant paid for equipment to increase the scope and capacity of production research, according to Bryan Young, an agricultural professor. â&#x20AC;&#x153;It will allow us to look at elements such as genetics, seeding rates, and variable-rate

chemical application on both a small and large scale,â&#x20AC;? Young said. Researchers already are using their big-ticket item â&#x20AC;&#x201D; a smallplot combine that will allow them to analyze and compare data from a strip of ground as small as two rows wide.

The grant also paid for a GPS-compatible tractor, a large-scale planter with variable-rate seeding components, and a field plot sprayer. The funding also helped underwrite the cost of a large-platform combine. The small combine is easier

to clean, which helps prevent cross contamination of crops that are still under development. The large-scale planter will allow the researchers to test seed that was promising in the small plots to determine how it performs under commercial conditions.

Olympic coach to speak at Equestrian Expo Jane Savoie, who coached Olympic riders and also competed in the

Olympics, will be one of several speakers at the Horsemenâ&#x20AC;&#x2122;s Council of Illinoisâ&#x20AC;&#x2122; Equestrian Lifestyle Expo Nov. 20-21 at the Lake County Fairgrounds, Grayslake. Savoie coached Canadian teams in the 2004 and 1996 Olympics and also coached several riders in the 2000 Olympics. She has been a member of the U.S. equestrian team since 1991 and has written five books. In addition to presentations, the Expo will offer a variety of workshops for current horse owners and those who would like to own a horse. Program

details will be available online at {www.HorsemensCouncil.org}. Vendors will offer English and western tack, clothing for all breeds and disciplines, feed, supplements, health care products, equipment and stable supplies, trailers and vehicles. One-day admission tickets cost $8 with two-day tickets selling for $14. They may be bought online with a credit card or at the door with cash only. For more expo information, go online to {www.HorsemensCouncil.or g} or call toll-free 866-3849161.

WE SALUTE Americaâ&#x20AC;&#x2122;s Youth

National

4-H Week & PAS Week October 3-9, 2010

Illinois Farm BureauÂŽ $IĂ&#x20AC;OLDWHV Youth Education Committee:

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BY KAY SHIPMAN FarmWeek

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FarmWeek Page 11 Monday, October 4, 2010

Growers and agri-businesses working together to become global leaders in soybean yields. More than 40 teams and 200 soybean growers throughout the state participated in the 2010 Yield Challenge to: Â&#x2122; IZhi ^ccdkVi^kZ Xgde bVcV\ZbZci higViZ\^Zh Â&#x2122; 8dbeZiZ [dg XVh] egôZh VcY heZX^Va gZXd\cî^dc Â&#x2122; 8daaZXi kVajVWaZ YViV [dg ZkVajVi^dc Wn gZhZVgX]Zgh! agri-businesses and growers for improving yield potential 9ViV$gZhjaih lâa WZ ejWa^h]ZY ^c 9ZXZbWZg#

THANK YOU, 2010 TEAM SPONSORS! AgLand FS Asgrow BASF Corporation Bayer CropScience Brimfield Agronomy Application Bureau Valley FFA Channel Bio CPS Ferris Effingham Clay Service Co. Effingham Equity Elburn Co-op

Genesys Grain Genetics GROWMARK Helena Illinois State University Kaneland FFA Kitchen Seed Company Marshall FFA Monsanto NK North East Vermillion FFA Parkland College

Piatt County FS Pioneer River Ridge FFA Shipman Elevator Southern Illinois University Stine Sunrise Ag Service Syngenta Seeds TriCounty FS University of Illinois Western Illinois University

Growers: Be sure to register for the 2011 Yield Challenge later this year! Find out more at soyyieldchallenge.com. Call (888) 826-4011.

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FarmWeek Page 12 Monday, October 4, 2010

FROM THE COUNTIES

EE — Custom candle orders and money are due Friday, Oct. 15. Orders may be picked up Monday, Nov. 22, at the Farm Bureau office. Call the Farm Bureau office at 857-3531 or visit the website {www.leecfb.org} for more information. ONTGOMERY — The Prime Timers will meet at noon Wednesday, Oct. 20, for a luncheon and meeting. A meatloaf dinner will be served. Cost is $8. Mike Watson, conservation officer, will be the speaker. Participants must be Montgomery County Farm Bureau members and 55 years of age or older to attend. Call the Farm Bureau office at 217532-6171 for reservations or more information. TARK — Farm Bureau will sponsor farm visits Tuesday for more than 100 students and chaperones from Charter Oak Elementary School. The students will visit the Mark Wilson farm, where they will learn about raising and caring for hogs. After lunch in the park, the students will visit the Frank Shafer farm and learn about harvest and farm safety.

“From the counties” items are submitted by county Farm Bureau managers. If you have an event or activity open to all members, contact your county Farm Bureau manager.

Election calendar Oct. 5 Last day to register to vote Oct. 11 First day for early voting Oct. 28 Last day for early voting Nov. 2 Election Day

Mason County’s specialty crops displayed for ‘adopted’ lawmaker BY CHRISTINA NOURIE

State Rep. Mike Zalewski (D-Chicago) recently traveled to Mason County to visit with his “adopted farmers” and tour Mason County agriculture. Zalewski was accompanied by his wife, Carrie, an attorney for the Illinois Pollution Control Board; his father-in-law, Bob Solberg; and his nephew, K.C. Solberg. His county Farm Bureau tour guides were Ron Armbrust, Mason County Farm Bureau president, and county Farm Bureau board members Adam Shissler and Randy Fornoff. Over lunch, the Farm Bureau members and Zalewski discussed the state budget, current issues in agriculture, and the upcoming election. Zalewski and his family experienced combines and corn harvest on Fornoff ’s farm, and the representative learned about grain farming and the modern technology used to harvest crops. At a stop to view an irrigation system, the farmers explained the importance of irrigation to Mason County agriculture. The representative learned corn wasn’t the only crop being harvested in the county when he toured a green bean field and rode on a green bean picker. He also discussed issues with a representative of Seneca Foods. The last tour stop was the Weaver Popcorn processing facility where the group heard an overview of the popcorn industry and the processing facility’s operation. Mason County Farm Bureau leaders are looking forward to learning about Zalewski’s urban district, which includes parts of the southwest side of Chicago and suburbs. A group plans to tour the representative’s district next year and to be a resource for Zalewski when ag issues are discussed in the General Assembly. Christina Nourie is the northeast legislative coordinator for Illinois Farm Bureau. Her e-mail address is cnourie@ilfb.org.

State Rep. Mike Zalewski (D-Chicago) and his nephew, K.C. Solberg, check out a combine on Randy Fornoff’s farm during a recent tour of Mason County agriculture. Mason County Farm Bureau “adopted” Zalewski, who brought family members with him on his visit. (Photo by Dee Dee Gellerman, Mason County Farm Bureau manager)

Cook County Farm Bureau names commissioners ‘friends’ BY BONA HEINSOHN

Eight Cook County Commissioners recently were named friends of the Cook County Farm Bureau. The honor, which was awarded by the Cook County Farm Bureau (CCFB), recognized commissioners who demonstrated a strong under-

standing of issues related to Cook County agriculture, business enhancement, economic development, and improved government efficiency. County board members — those who are up for re-election and whose voting record aligns with CCFB policy more than 85 percent of the time — were eligible. Issues considered when determining award recipients included: lowering the county’s sales tax rate, guidelines for the expenditure and reimbursement of contingency funds for county commissioners, imposition of a countywide hiring freeze, and lowering the county veto threshold to a three-fifths supermajority. Previously the threshold was a four-fifths supermajority. Commissioners John Daley (District 11, Chicago), Bridget Gainer (District 10, Chicago),

Cook County Commissioner Gregg Goslin, right, discusses issues with Cook County Farm Bureau members Pat Horcher, left, and Kim Morton prior to a board meeting in Chicago. (Photo courtesy Cook County Farm Bureau)

Elizabeth “Liz” Gorman (District 17, Orland Park), Gregg Goslin (District 14, Glenview), Anthony Peraica (District 16, Riverside), Peter Silvestri (District 9, Elmwood Park), Timothy Schneider (District 15, Bartlett), and Lawrence Suffredin (District 13, Evanston) received the 2010 “Friend of the Cook County Farm Bureau” award. “The Bureau is very important to me and has been a great asset in my knowledge about and work for the people of Cook County,” said Commissioner Silvestri.

In addition to receiving a scale model of a John Deere 7630 tractor and oak plaque as a token of appreciation, county board members also received produce grown locally on Cook County farms. Fruits and vegetables were produced and donated by Brandau Farms, Horcher Farms, and Zeldenrust Farms. The oak plaque was designed and constructed by CCFB board member Jim Gutzmer. Awards and produce were presented by Pat Horcher, board member; Cindy

Gustafson, volunteer; Janet McCabe, Public Policy Team member; and Kim Morton, and Ruth Zeldenrust, CCFB Political Action Committee members. Since 2008, the county Farm Bureau has been working closely with the Cook County Board of Commissioners to expand individuals’ knowledge of agriculture. Bona Heinsohn is Cook County Farm Bureau’s director of public policy. Her e-mail address is bona@cookcfb.org.

FarmWeek Page 13 Monday, October 4, 2010

TRADE

Commodity groups promote U.S. farm products worldwide BY DANIEL GRANT FarmWeek

Bill Olthoff, Illinois Farm Bureau District 6 director from Bourbonnais, believes international trade is vitally important to the livelihood of U.S. farmers. In fact, Olthoff recently gave up precious harvest time on his home farm in Kankakee County in September to travel to Ho Chi Minh City, Vietnam, to take part in the seventh annual Southeast Asia U.S. Agricultural Cooperators Conference. The event was organized by the U.S. Grains Council (USGC) — Olthoff represents IFB on the USGC board — and the American Soybean Association (ASA) in partnership with the U.S. Wheat Associates. “It (trade) is huge” to the bottom line of U.S. farmers, Olthoff said. “We produce way more here than we can consume.” A total of 175 participants representing 95 major companies involved in feed and food production and distribution were at the conference in Vietnam.

“We really developed great relationships with them,” Olthoff said. “It was a good example of (checkofffunded) commodity groups working together” to promote U.S. ag products. NetworkBill Olthoff ing at the Southeast Asia ag conference resulted in the sale or negotiation for sale of 1.17 million metric tons of U.S. ag products valued at $368.9 million (a record for the event). Meanwhile, international grain buyers are descending

on Illinois this harvest as various ag groups host trade missions. Olthoff will give farm tours to a group from Jordan on Oct. 10 and to grain buyers from South Korea on Oct. 11. USGC this week also is co-hosting an Export Exchange with the Renewable Fuels Association in Chicago to promote exports of U.S. distillers dried grains. “We need to take care of our customer base,” said Phil Thornton, director of valueadded projects for the Illinois Corn Growers Association/Marketing Board, who last week escorted corn buyers from the Dominican Republic on a tour of the

state’s ag industry. “Illinois each year produces roughly 2 billion bushels of corn and we export about 50 percent of that,” he said. “It (the export market) is very important to us.” Thornton this fall also will be directing Illinois farm tours for trade groups from China, Japan, and South Korea. He said it is important this year to reassure buyers the U.S. will have an ample supply of grain and a quality crop. “The quality (of the corn crop) is looking good. It’s naturally dry (at 14 to 15 percent moisture) coming out of the fields,” Thorn-

MAINTAIN YOUR PROPANE For safe and efficient grain drying.

Auction Calendar Sat., Oct. 9. 9 a.m. Congerville Consignment Auction. CONGERVILLE, IL. Kaufman Auction Service. www.calkaufmanauction.com Sat,. Oct. 9. 9 a.m. Farm and Construction Eq. Auction. SOUTH WAYNE, WI. Powers Auction Service. www.powersauction.com Thurs., Oct. 14. 10:30 a.m. 75 Ac. LaSalle Co. Farmland. Roseland Hinton Trust, SENECA, IL. Auctioneers: Dick McConville and Marty McConville. www.biddersandbuyers.com, www.mcconvillerealty.com, auctions@mcconvillerealty.com Thurs., Oct. 14. 1 p.m. 160 Ac. Iroquois Co. Land. Robert Randolph Estate, PAXTON, IL. Schmid Auction & Realty Co. schmidauction.com Sat., Oct. 16. 10 a.m. Public Auction. James F. Ribordy Estate, Joyce E. Ribordy, PONTIAC, IL. Immke and Bradleys’ Auction Service. biddersandbuyers.com/immke Wed., Oct. 20. 7 p.m. 107 Ac. Sangamon Co. Tomlin Bros., PLEASANT PLAINS, IL. Middendorf Bros. Auctioneers and Real Estate. www.middendorfs.com Thurs., Oct. 21. 10 a.m. 73.1 Ac. Bureau Co. Martin Farm, LADD, IL. Auctioneers, Joe McConville and Marty McConville. www.mcconvillerealty.com, www.biddersandbuyers.com, auctions@mcconvillerealty.com Thurs., Oct. 21. 10 a.m. 80 Ac. Livingston Co. Robert W. Brown and Susan K. Brown et. al., Immke and Bradleys’ Auction Service. biddersandbuyers.com/immke Sat., Oct. 23. 10 a.m. Farm Land Auction. Heil Farm, SIBLEY, IL. Bill Kruse, Auctioneer. Wed., Oct. 27. 98.72 Ac. Jefferson Co. Soy Capital Ag Services. www.soycapitalag.com Thurs., Oct. 28. 7 p.m. 80 Ac. White Co. Wayne and Deanna Williams, GRAYVILLE, IL. Carson Auction, Realty & Appraisal Co. www.carsonauctionandrealty.com Sat., Oct. 30. 10:30 a.m. 116.68 Ac. Rock Island Co. Jane T. Olson, Mary L. Spohnoltz, Eileen T. Grosso, BUFFALO PRAIRIE, IL. Steve Relander Auctioneer/Farm Broker. www.relanderauctions.com Mon., Nov. 1. 10:30 a.m. 137.54 Ac. Vermilion Co. Womacks Estate, ROYAL, IL. Gordon Hannagan Auction Co.

Learn more by touring a virtual propane farm at

ton said. “Last year it was so wet a lot of it was mechanically dried and it ended up with a lot of stress cracks.” Members of the Illinois Soybean Association last week also opened up their farms to Chinese importers so they could get a firsthand view of the new crop. That trade mission was arranged by the U.S. Soybean Export Council in cooperation with ASA and the United Soybean Board. Overall, U.S. agriculture this year is expected to generate a trade surplus of $28 billion compared to $23.2 billion in 2009, according to USDA.

FarmWeek Page 14 Monday, October 4, 2010

PROFITABILITY

Quality grain so far — let’s keep it that way! BY RANDY HOLTHAUS

There is one word that keeps appearing in every harvest discussion: early. Early is great, but perhaps the best news of all is that we have an abundance of good-quality grain, Randy Holthaus something we could only dream about last year. Even though we have many mature, full kernels with minimal fines and foreign material, we must make sure we don’t get complacent and let our guard down. All of the same storage and aeration rules still apply if you intend to keep your grain that way. It is important to remember grain temperature and moisture content dictate the “allowable storage time” of the grain — how long you have to dry the grain and how long it can be kept before it spoils. Allowable storage time begins at harvest. Here is an example of how to calculate allowable storage time of corn using the chart provided: Assume you harvest 26 percent moisture corn with a grain temperature of 60 degrees. The chart shows that 26

percent corn at 60 degrees must be dried within eight days. Now assume that after four days we’ve dried this grain down to 18 percent and cooled it to 50 degrees. How long can we safely store this corn? It’s not what you think! Corn at 26 percent moisture and 60 degrees stored for four days has used half of its total storage life. Drying the corn to 18 percent and cooling it to 50 degrees does not mean you can store it for 128 more days as the chart shows. Half of the allowable storage time already has been used, so the actual storage time remaining is only 64 days. NOTE: Corn storage tem-

BY DANIEL GRANT FarmWeek

A dairy herd structure report released by USDA pretty much confirmed the obvious. The trend of “addition by subtraction” continues as the total number of dairy farms in the U.S. from 2001 to 2009 declined. But that was offset by the fact that the number of dairy cows increased nationwide due to larger herd sizes. USDA reported the number of milk cow operations nationwide from 2001 to 2009 slipped from 97,460 to 65,000, a 33 percent decline.

Feeder pig prices reported to USDA*

Weight 10 lbs. 40 lbs. 50 lbs. Receipts

Range Per Head Weighted Ave. Price $33.60-$46.00 $39.42 $49.00-$58.03 $55.06 n/a n/a This Week Last Week 21,003 25,557 *Eastern Corn Belt prices picked up at seller’s farm

Eastern Corn Belt direct hogs (plant delivered) (Prices $ per hundredweight) This week Prev. week $75.46 $81.32 $55.84 $60.18

Change -5.86 -4.34

USDA five-state area slaughter cattle price Steers Heifers

This week n/a $95.75

time in half. Large amounts of fines and foreign material will shorten storage time even more. Here are recommended moisture levels for safely stor-

Randy Holthaus is GROWMARK’s grain systems marketing manager. His e-mail address is rholthaus@growmark.com.

USDA report shows dairy farms getting larger

M A R K E T FA C T S

Carcass Live

perature shown on the chart is KERNEL temperature. This chart is based on clean, goodquality corn. Corn with 10 percent mechanical damage can cut the allowable storage

ing corn on the farm: • 17 percent is considered low enough if corn is to be fed to livestock during the winter. • 15 percent is recommended for corn that will be removed from storage before the start of summer. • 13 percent is recommended for corn that is to be carried into summer or stored longer than one year. Remember, safe storage is dependent on well-managed aeration through any seasonal changes.

(Thursday’s price) Prv. week Change $97.00 $97.00 -1.25

CME feeder cattle index — 600-800 Lbs. This is a composite price of feeder cattle transactions in 27 states. (Prices $ per hundredweight) Prev. week Change 109.92 0.11

This week 110.03

Lamb prices Slaughter Prices - Negotiated, Live, wooled and shorn 125-160 lbs. for 125154.02 $/cwt., dressed, no sales reported.

Export inspections (Million bushels)

Week ending Soybeans Wheat Corn 09-23-10 18.6 24.3 34.0 09-16-10 12.9 33.1 35.4 Last year 7.8 24.7 35.7 Season total 42.1 354.1 129.2 Previous season total 27.0 275.8 145.8 USDA projected total 1470 1200 1975 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

However, the milk cow inventory actually increased by 1 percent during the same time as the number of operations with 500 or more head increased by 20 percent. “It (the report) is no big surprise,” said Mike Hutjens, University of Illinois Extension dairy specialist. “It’s a road map of where the industry is going.” Hutjens believes the trend of larger herd sizes will continue due to economies of scale. Large dairy farms typically have advantages over smaller farms in terms of labor and purchasing power, and they often are more efficient. USDA reported milk production from 2001 to 2009 increased by 15 percent even though the herd size increased by just 1 percent. “I think we’ll continue to see the trend of larger farms,” Hutjens said. “A dairy farm that can make more milk per cow has a tremendous advantage. It’s a fact of life.” The trend in the Illinois dairy industry the past decade stuck to more a traditional theme. The average herd in Illinois in 2009 totaled 114 head compared to the nationwide average of 167 head. The average dairy herd in New Mexico, for comparative purposes, was 2,167 head. “We’re not seeing near the growth (in herd sizes in Illinois),” Hutjens said of the milk-deficient state. “We’re seeing more traditional Midwestern dairy farms in the 100to 200-cow range. I think it reflects more diversity.” Hutjens noted many dairy farms in Illinois still produce crops. The diversity is an advantage to Illinois producers during hard times, but the smallscale production and lower milk

yields are a challenge. Illinois milk cows in 2009 produced an average of 18,873 pounds of milk per head compared to the national average of 20,567. Looking ahead, Hutjens pre-

dicted milk prices would remain profitable through the end of the year. However, dairy expansion in states such as California and Wisconsin likely will boost milk output and be a drag on prices in 2011.

Milk price climbs again The Class III price for milk adjusted to 3.5 percent butterfat for the month of September was $16.26 per hundredweight. This is a $1.08 increase from the previous month. Six straight months of higher prices have helped return profitability to the dairy industry. The last two months alone have added more than $2.50 per hundredweight to the milk check. In past years, higher prices leading into the fall has been the trend.

FarmWeek Page 15 Monday, October 4, 2010

PROFITABILITY Corn Strategy

C A S H S T R AT E G I S T

Corn stocks shock traders USDA’s estimate for the Sept. 1 corn stocks hit the market like a bomb. No one was looking for a number near the 1.708 billion bushels USDA estimated. The impact was immediate and significant, with corn prices falling 40 cents the two days following the report’s release. And prices already had declined in the early part of the week prior to the report. In the aftermath, we have seen a lot of disbelief — and commentary — that this number cannot be correct. It did not fit with the June corn stocks number, nor did it fit with the popular perception surrounding the low test weights of last year’s corn crop. But, the Sept. 1 corn stocks estimate does fit relatively well with both the Dec. 1 and March 1 stocks numbers. That tends to suggest that it, and not the June 1 number, may be a more accurate reflection of the old crop’s fundamental structure. One also would think USDA should be able to more accurately project supplies when they are at their seasonal low point. More immediate is the implication these unexpected bushels have on the new-crop supply/demand structure. The extra 300 million bushels are the equivalent of having another 2 million new-crop

Basis charts

acres at 150 bushels per acre. Or, it represents the equivalent of nearly 4 additional bushels of new-crop yield using the 81 million acres that are projected to be harvested. In essence, the extra bushels USDA found on Sept. 1 could fully offset, and maybe even more than offset, the possibility that the final corn yield will decline from the 162.5bushels-per-acre number projected in the September report. Using the 157- to158-bushel level that some have been talking about, the equivalent 4 bushels represented by the extra stocks would point to an equivalent 161- to 162-bushel yield for the crop being harvested. Another factor to remember is the possibility of an adjustment in planted and harvested acreage in the October USDA crop report. When USDA analysts put together the October crop estimates, they review the acreage data farmers report to their Farm Service Agency office. While it is not yet a complete accounting, it is close enough that USDA analysts use it to adjust their acreage forecasts if needed. A couple of respected private analysts have long argued corn acreage is higher than forecast, somewhere between 1/2 and 1 million acres. That could add another 80 million to 160 million bushels to the corn production potential. At the end of the day, the stocks number alone will make it more difficult to project a new-crop ending stocks number below 1 billion bushels. While that’s relatively tight compared to usage, it’s still large enough to meet needs until we harvest the next crops. Maybe just as important is the impact the stocks number has had on actions by the big speculative funds. The shock of the number pushed prices low enough to trigger long liquidation by the funds. And once they start leaving a market, it usually is more difficult to rebuild bullish momentum. AgriVisor endorses crop insurance by

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2010 crop: Prices dropped to a two-week low after the Sept. 30 USDA report, hinting the short-term trend could be down. There is a possibility this is only a break into a seven-week low, but it also could signal the trend is turning down into the 20-week low due in November. Because short-term downside risk is significant, you should get sales up to recommendation, unless December futures are below $4.75. Storage costs are too steep to warrant storing corn off the farm, unless basis levels are unusually wide. A hedge-to-arrive ( HTA) contract for March delivery may work, especially for farmstored grain. 2011 crop: If you haven’t made the new-crop sale yet, use a rally to make catch-up sales unless December 2011 futures are below $4.65. Fundamentals: The extra 300 million bushels in the Sept. 1 stocks report will partly compensate for the possibility the new-crop yield is lower than forecast. The extra stocks are the equivalent to 4 bushels of new-crop yield.

Soybean Strategy 2010 crop: Dollar weakness, Chinese buying, and short-term trading strategies are supporting soybean prices. Still, prices have reached what should be strong resistance. Get sales up to recommendation. If you store soybeans commercially, we wouldn’t discourage you from wrapping up sales. 2011 crop: If South America has another big crop, new-crop prices will be lower this spring. Make an initial 10 percent sale now. Fundamentals: Harvest reports continue to indicate this year’s yield will be nearrecord to record. Even with good demand, supplies will exceed demand. The latest South American weather forecasts indicate seasonal rains should begin in early October, paving the way for planting to start. More importantly, the forecasts will reduce the early anxieties for the crop while

increasing potential for a large world crop, one that should eclipse demand.

Wheat Strategy 2010 crop: Wheat penetrating the 50-day moving average implies the short-term trend has turned down. The next significant level of support doesn’t come until the $6.23 level. Old-crop sales are complete. We’d discourage making catch-up sales on weakness, but would use a rally near $7 on Chicago December futures. Storage hedges or HTA contracts for winter delivery are still the best marketing tool.

2011 crop: Use rallies to $7.20 on Chicago July 2011 futures for catch-up sales. If basis is wide compared to this past summer, consider a HTA contract. Fundamentals: The recent USDA report offered no surprises for wheat. USDA pegged U.S. stocks at 2.459 billion bushels. Export demand is good but will not pull supplies low enough to justify higher prices. Winter plantings may decline in the Black Sea region, but recent rains, and forecasts for more, have improved newcrop prospects in most of the region.

FarmWeek Page 16 Monday, October 4, 2010

PERSPECTIVES

GREEN ECONOMY Conservation districts play a critical role in states’ economic, environmental health Across the United States, nearly 3,000 conservation districts are helping local people conserve land, water, forests, wildlife, and other precious natural resources. These districts share the single mission of coordinating assistance from all available avenues — including public and private, local, state, and federal sources — in an effort to develop locally led solutions to natural resource concerns. As the districts’ national representative, the National Association of Conservation Districts (NACD) supports voluntary, incentive-based programs providing landowners with both financial and technical assistance to improve soil, air and water STEVE quality, restore habitat, and enhance ROBINSON the land. Districts are necessary for states’ economic stability and growth. Yet many states currently are dealing with significant financial challenges, as districts struggle to maintain the funding to carry out critical conservation work. Unfortunately, the State of Illinois is no exception. Illinois Soil and Water Conservation Districts (SWCDs) will receive just over half the funding they were given two years ago. Since Illinois SWCDs have limited taxing authority, they’re forced to rely on the state — and additional sales, grants, and the generosity of the county government — to cover their operating costs. Only 29 of Illinois’ 98 SWCDs actually received any fiscal year 2010 (FY10) money before FY10 ended on June 30. Since then, most of the districts have received about half their FY10 funds. With no guarantee when they’ll see the rest of these funds, many districts are facing employee layoffs and other cuts to essential programs. The State of Illinois invests about $1 for every $50 SWCDs add to the state’s economy through federal programs. In the coming year, Illinois SWCDs are designated to help administer more than $415 million in contracts that will provide significant envi-

ronmental benefits, including initiatives under the Environmental Quality Incentives Program, Conservation Reserve Program, Wetlands A farmer gathers haylage on a conservation buffer in Jo Daviess County. (Photo courtesy Reserve Program, and Association of Illinois Soil and Water Conservation Districts) others. instance, national soil erosion has been reduced by It’s obvious current budget cuts pose a serious nearly one half — resulting in substantial reduction concern to the economic and environmental health in loadings to bodies of water. of the state. We’ve also seen an increase and The public expects clean air, improvement in wildlife habitat on clean water, healthy soils, and private lands. With private lands repabundant wildlife habitat. As a resenting 70 percent of U.S. land, this nation, we need to be fully comis an important consideration. mitted to providing the necesThough we’ve seen significant sary tools and assistance so achievements, our work is far from landowners can achieve these done. essential public goals. We must NACD was founded on the philosinvest in a strong network of ophy that conservation decisions districts across the country. should be made at the local level with This investment — along with technical and funding assistance from appropriate conservation incenfederal, state, and local governments tives — will allow landowners to and the private sector. implement conservation strateExperience tells us we’re more gies and make necessary changes effective conservationists when we to the landscape in order to work voluntarily with landowners and accomplish these vital goals. resource users, rather than when A few things, districts do: we’re subjected to top-down federal help conserve and restore wetregulatory mandates. That’s one of lands; protect groundwater the reasons NACD’s work at the resources; plant trees and other Conservation buffers protect the soil national level is so important. land cover to hold soil in place; a n d e n h a n c e w a t e r q u a l i t y. ( K e n By maintaining strong relationships provide cover for wildlife; imple- Kashian photo) with lawmakers, regulators, and likement farm conservation practices minded associations and coalitions in to keep soil and nutrients in the fields; assist local Washington, D.C., NACD is working to ensure discommunities with stormwater management; and tricts are armed with the resources necessary to carry reach out to communities and schools to teach the out voluntary, incentive-driven natural resource convalue of natural resources and encourage conservaservation programs that benefit all citizens. tion efforts. In the last 25 years, our nation has seen tremenSteve Robinson, a producer from Marysville, Ohio, is president dous progress in caring for our natural resources. of the National Association of Conservation Districts Much of this progress can be directly attributed to (NACD). For more information on NACD, go online to the successful work of conservation districts. For {www.nacdnet.org}.

LETTERS TO THE EDITOR ‘Death tax’: Don’t debate it, repeal it Editor: I wish to share a few observations and opinions concerning the so-called “death tax” issue. First is the issue of fairness. What logic or fairness is behind the idea that a government (at least in a presumed “free” country) is somehow entitled to a share of property value just because someone dies? I fail to see that it really matters whether it is a farm, business, or something else. The person/persons who built and worked for something should be able to pass it to whomever. Secondly, the inflated price of land isn’t a fair reckoning, anyway. Land prices are driven largely by non-farm people. Most farmers really can’t afford to buy land at today’s prices unless they are big

enough to simply absorb it. Why should a family have to sell half of a farm just so they can keep the rest? Is it some politician‘s idea of redistribution of wealth? Are they angered because someone has a little too much, in their opinion? And thirdly, all the political postulating misses the point. While pre-election debate abounds and rhetoric sees no limits in sight, the people who really matter probably will be ignored, as usual. The point I’m referring to is simple. No amount of taxes — estate or otherwise — is going to solve this government’s problems. These people are unreasonable, out of control, addicted to spending, and have no concept of the realities of what their jobs are. The estate tax law doesn’t need debating. It doesn’t need “fixing.” It doesn’t need to find a happy median on which politicians can agree.

It simply needs to be repealed. STEVE MIDDELTON, Metropolis

Farm-friendly candidates deserve our support Editor: Thank you for your excellent coverage of the estate tax issue and “cap and trade.” The return of the 55 percent “death tax” on Jan. 1, 2011, and the heavy increase in expense and regulation under cap and trade would be great burdens for many successful farmers. Farm families should be knowledgeable about where their elected representatives stand on these two issues. Because of bad weather, escalating expenses, taxes, equipment repair, etc., the income from my farm, like many others, has been modest. Appreciation in land val-

ue represents an important return for years of hard work. We must not let the government have up to 55 percent of this farm value. We strongly oppose liberals who believe in the false premise of cap and trade. Our candidates should be willing to vote to restore at least a $5 million estate tax exemption indexed to infla-

tion or to eliminate this terrible tax completely. I recently have placed three signs on the highway in front of my farm supporting candidates who are farm friendly and oppose added taxes and regulations. Get to know the candidates you can support and help elect them. EDWARD F. RAGSDALE, Alton

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