T H E I L L I N O I S FA R M Bureau board opposes the health care bill as currently written and has some suggestions for reform. ........2
PORK PRODUCERS already are taking a big-time hit, but losses are projected to get even worse — in the neighborhood of $54 per head ..........5
Monday, August 24, 2009
FARMERS LIKELY will pay more for seeds in 2010, a Monsanto spokesman said. But new varieties are expected to boost yields. ..........8
Two sections Volume 37, No. 34
Weather remains active; storms pound state BY DANIEL GRANT FarmWeek
Periodicals: Time Valued
It probably feels like spring all over again for many Illinois farmers as the weather pattern last week was more typical for mid-May than mid-August. Thunderstorms that produced flash floods, strong winds, and tornadic activity swept across portions of the state last week. From near Rushville in West-Central Illinois to Danville in East-Central Illinois anywhere from 1 to 2.5plus inches of rain fell, according to Ed Shimon, meteorologist with the National Weather Service in Lincoln. Meanwhile, tornadic activity damaged numerous houses, outbuildings, crops, and trees in DeWitt, Logan, Morgan, Sangamon, and Scott counties. One twister was reported on the ground for at least 25 miles from Williamsville to Elkhart, Chesterville, and Beason. Numerous houses were damaged or destroyed, a number of injuries were reported, and thousands homes lost power in the wake of the storm. No fatalities were reported as of Friday, but some victims of the storm reportedly were
in local hospitals. A large swath of field crops was leveled in the area. Country Financial Friday morning reported it had received 206 claims of property damage, 44 claims of auto damage, and 19 claims of crop damage from the storm. It also reported 23 clients’ homes, most near Williamsville and Loami in Sangamon County, were uninhabitable. Shimon said the peak season for tornadoes in the state is from April to June, but last Wednesday probably will end up as one of the most active severe weather days of the year. “We don’t see a lot of tornado outbreaks in our area in August,” Shimon said. “But this (storm) had the makings of severe weather.” Rainfall totals for the month See Weather, page 7
Bill Burris of rural Williamsville in Sangamon County clears debris from his five-acre cornfield located on the edge of Williamsville. The field was expected to be a total loss because of broken stalks and the amount of debris from trees and building materials from the nearby town. Before the storm, the field had yield potential of 200 bushels per acre. The debris also will prevent the corn from being used as silage for Burris’ cattle. In all, about 40 acres of Burris’ 500 acres of corn and soybeans were damaged. The heavily damaged building in the background is the Williamsville Christian Church. (Photo by Ken Kashian)
Climate bill would take a bite out of animal sector BY MARTIN ROSS FarmWeek
The impact of House-proposed “capand-trade” measures would be felt in the feedlot, the farrowing house, the milking parlor, and, most significantly, in the producer’s pocketbook, livestock industry analysts warn. “Energy input costs throughout the food chain” would impact the livestock sector, from feed costs to prices food manufacturers would pay for meat, eggs, or milk, American Farm Bureau Federation (AFBF) energy specialist Alison Specht maintained. “There are numerous impacts we’re looking at, and not all those questions have answers yet,” Specht said. The federal Energy Information Administration predicts U.S. electricity customers could face a 20 percent price increase in 20 years under the House plan, with even higher power costs anticipated after 2030. If emissions caps on utilities and manufacturers fuel new competition for natural gas, climate policy could “hit the hog and dairy folks on the input side worse than anyone else,” according to AFBF livestock econ-
omist Jim Sartwelle. University of Illinois dairy specialist Mike Hutjens cites already-hefty costs for on-farm milk cooling equipment. Illinois Pork Producers Association President Phil Borgic sees climate regulation offering bleak prospects for a swine industry “that’s already gone through its 23rd or 24th month of losses.” “Our own power bill runs $6,000 a month, and (some analysts are) talking about costs going at least a third higher,” Borgic told FarmWeek. “That would mean a $24,000 a year increase strictly on my sow unit.” And as costs increase, he fears packers and processors could attempt to trim energy costs by cutting personnel, shifts, or “increasing their margins” through lower hog and cattle prices and/or higher meat costs. In a statement on the House measure, the National Pork Producers Council (NPPC) expressed concern about “having to bear the costs of GHG (greenhouse gas) emissions
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controls while our competitors overseas are not.” NPPC warned that could further reduce U.S. pork market share both domestically and overseas. However, rather than offsetting the competitive impact of new regulatory costs, Borgic argued proposed duties on meat imported from non-climate-regulated countries would merely “open another can of worms” on the global trade scene. Up the food chain The House bill would exempt agriculture from emissions caps. However, packers could be subject to emissions caps on a perfacility basis, forcing them either to reduce their greenhouse “footprint” or buy potentially costly emissions credits from other sectors that have achieved reductions or carbon “sequestration” (capture and storage). Further, House provisions open the door to federal “performance standards” for noncapped sectors that fail to meet long-term emissions reduction goals. While producers have significantly reduced their “carbon footprint per unit of output,” AFBF’s Specht suggests some swine units or feedlots eventually could be See Climate, page 4
Illinois Farm Bureau®on the web: www.ilfb.org
FarmWeek Page 2 Monday, August 24, 2009
Quick Takes QUINN SUPPORTS PORK PRODUCERS — Gov. Pat Quinn did his part to support Illinois pork producers and clear up misconceptions about the H1N1 flu virus during the Illinois State Fair. “There is a big challenge with H1N1 and a misconception that pork causes that,” Quinn told a group of reporters after he signed ag legislation. “That’s the No. 1 challenge right now.” Quinn told the assembled crowd he planned to buy a pork chop sandwich from the Illinois Pork Producers Association at the Commodity Pavilion. “I want to help them because right now they’re in a tough spot,” he said. True to his word, the governor bought a pork sandwich at the pavilion then gave an impromptu interview on the Illinois Farm Bureau stage before chatting with fair visitors. See more on the challenge pork producers face with H1N1 misconceptions on page 16. SALE OF CHAMPIONS SETS RECORDS — The Governor’s Sale of Champions of junior livestock winners brought record prices for prize-winning poultry, rabbits, and meat goat last week at the Illinois State Fair. Peter Elliot of Monmouth in Warren County received $8,000 for his grand champion poultry pen trio. Lexy Schafer of Brighton in Macoupin County sold her grand champion rabbits for $7,500. Chris Curry of Dawson in Sangamon County received $6,900 for the grand champion meat goat. Addie Girard of Pontiac in Livingston County received $30,100 for her grand champion steer, while Sarah DeSchepper of Altona in Knox County sold her grand champion wether for $7,500. Codee Schlipf of El Paso received $15,000 for the grand champion barrow. Eighty percent of the sale proceeds goes to the owner of the champion animal while 10 percent goes to Illinois 4-H and 10 percent goes to the Illinois FFA Association. RECALL READINESS — In the next year or so, meat processing plants will be required by USDA to develop detailed product recall plans, officials told attendees at a North American Meat Processors Association conference on prevention of E. coli infection. As required by the farm bill, USDA is developing rules processors must follow when writing recall plans. USDA Food Safety and Inspection Service officials said mandatory recall plans will need to include detailed information on personnel, procedures, evaluation of health hazards, product information and traceback records, communication strategies, and how the public will be notified.
GOVERNMENT
IFB board: House health plan wrong prescription BY MARTIN ROSS FarmWeek
The Illinois Farm Bureau Board of Directors last week reached the same prognosis offered by policymakers and millions of Americans: U.S. health care needs help. However, the IFB board also concurred with a growing number of Americans at town meetings across the country: House Resolution 3200, a massive health care blueprint that proposes expanded public health coverage and mandatory insurance coverage, is the wrong prescription for what ails rural families and communities. Friday, the board decided to seek American Farm Bureau Federation opposition to the bill as currently written, while offering a few basic precepts for health care reform. Elgin’s Mike Kenyon agreed “there’s room for improvement” in the health system. Directors cited legal tort reforms that would reduce malpractice-related health costs
and proposed patient “portability” — the ability to transfer coverage to another insurer or state without fear of exclusion because of minor pre-existing conditions or other grounds. Beyond concerns about the impact of a proposed federally administered “public option” on the existing insurance system, IFB President Philip Nelson questioned current pressure to rush “a 1,000-page bill that people don’t even know what’s in it.” “People want choice, they want (health insurance) portability, they want the decisions to be made between them and their doctors, and they don’t want to add to the national debt,” Dixon director Jim Schielein said. Fairview’s Kent Schleich, meanwhile, stressed the need to clarify what IFB supports in terms of health reform. IFB National Legislative Director Adam Nielsen noted IFB supports such smallerscale measures as reasonable regulations and training
requirements for emergency services professionals and volunteers and incentives for recruitment and retention of rural physicians and other medical providers. Beyond HR 3200, lawmakers have proposed a patchwork of proposals aimed at fixing portions of the system. Earlier this month, Sen. Dick Durbin, a Springfield Democrat, introduced legislation that would allow services by certified registered nurse anesthetists to be reimbursed by Medicare, helping ensure crucial rural critical access hospitals can continue to provide surgical services. Durbin also is sponsoring more comprehensive legislation that would allow small businesses and the selfemployed to band together in statewide pools to obtain lower insurance prices. The measure would provide credits to help offset the cost of providing insurance and ban premium variations that are based on a consumer’s health status or gender.
Illinois State Treasurer Alexi Giannoulias, right, congratulates the recipients of Excellence in Agriculture scholarships, which were awarded during Ag Day at the Illinois State Fair. Ten students were selected from among 150 applicants. (Photo by Kay Shipman)
Illinois treasurer awards 10 ag scholarships (ISSN0197-6680) Vol. 37 No. 34
August 24, 2009
Dedicated to improving the profitability of farming, and a higher quality of life for Illinois farmers. FarmWeek is produced by the Illinois Farm Bureau. FarmWeek is published each week, except the Mondays following Thanksgiving and Christmas, by the Illinois Agricultural Association, 1701 Towanda Avenue, P.O. Box 2901, Bloomington, IL 61701. Illinois Agricultural Association assumes no responsibility for statements by advertisers or for products or services advertised in FarmWeek. FarmWeek is published by the Illinois Agricultural Association for farm operator members. $3 from the individual membership fee of each of those members go toward the production of FarmWeek.
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Illinois State Treasurer Alexi Giannoulias last week awarded 10 excellence in agriculture scholarships during Agriculture Day at the Illinois State Fair, Springfield. Each recipient will receive a $2,500 Bright Start College Savings account. Winners were selected for their academic achievement, community service, and essays about their commitment to agriculture studies and careers. The 2009 Excellence in Agriculture Scholarship winners are: • Carmen Au, daughter of Rui Sheng Mai of Chicago, who will study food science at the University of Illinois. • Jeffrey Barnes, son of James and Danette Barnes of Leland, who will study agricultural business at Joliet Junior College and later Iowa State University. • Jacob Becraft, son of Robert and Lori Becraft of Metamora, who will study chemical and bimolecular engineering at the U of I. • Matthew Doherty, son of Tom and Cheri
Doherty of Springfield, who will study agricultural engineering at the U of I. • Will Glazik, son of Jeff and Rita Glazik of Paxton, who will study crop science at the U of I. • Briana Grymonprez, daughter of Tim and Shelly Grymonprez of Port Byron, who will study biotechnology and pre-veterinary medicine at the U of I. • Kelsey Koster, daughter of Douglas and Kelly Koster of Aurora, who will study food science at the U of I. • Shelby Magnuson, daughter of Chris and Susan Magnuson of Normal, who will study food science at the U of I. • Patricia Paulausky, daughter of Renee and Robert Verburgt of Lockport, who will study agricultural and biological engineering at the U of I. • Eric Sommer, son of Todd and Cheryl Sommer of Foosland, who will study agricultural accounting at the U of I.
FarmWeek Page 3 Monday, August 24, 2009
STATE FAIR
Local food on menu at State Fair Ag Day BY KAY SHIPMAN FarmWeek
State efforts to promote sales of locally grown food became state law after Gov. Pat Quinn signed HB 3990 on Ag Day last week at the Illinois State Fair. “You are our heroes. You make it possible for us to have good food,” Quinn told farmers and ag leaders gathered on the ag director’s lawn for an annual award ceremony. The bill creates goals for state agencies to buy 20 percent of their food locally by 2020 and for state-funded entities, such as schools, to have a 10 percent local food goal by 2020. In addition, the law allows state-owned food buyers to give preference to locally grown food. The legislation also creates a state Local Food, Farms, and Jobs Council to work with state agencies and Illinois businesses,
groups, and individuals to build a local farm-food market. “There’s a push by large retailers and institutions to buy more fresh produce and to buy it locally,” said Illinois Farm Bureau Director Bill Olthoff of Bourbonnais. Olthoff served on the Illinois Local and Organic Food and Farm Task Force, which worked on the legislation. “We (task force members) also feel there is an opportunity for small farmers to get involved in agriculture because they would not need the capital outlay (needed) for a grain farm,” Olthoff added. Sen. Jacqueline Collins (DChicago) and Rep. Julie Hamos (D-Evanston) sponsored the legislation. Why would a Chicago senator sponsor farm and food legislation? “It’s a win-win for all the state’s citizens,” said Collins during the bill signing ceremony.
Gov. Pat Quinn, seated, hands a pen to Sen. Jacqueline Collins (D-Chicago) during an Illinois State Fair signing ceremony of a bill to promote locally grown food. Collins was sponsor of the legislation. Looking on at left is Illinois Farm Bureau Director Bill Olthoff of Bourbonnais, who served on the Illinois Local Food and Farms Task Force that worked on the legislation. (Photo by Kay Shipman)
“Ninety percent of the fruits, vegetables, and meats that Illinoisans eat is imported. I think that’s absurd,” the senator said. Quinn said he’s no stranger to locally grown food, which
has become a focus for the chef at the governor’s mansion. “We want to make sure the food at the governor’s mansion is locally grown whenever possible,” he added.
Olthoff envisioned the law doing more than increasing sales of locally grown food. It “will help the populace of the state understand what it takes to produce food,” he concluded.
New FSA leader keeping focus on agency’s farmer customers Farmers needn’t worry about Jonathan Coppess, the new national administrator of the Farm Service Agency (FSA), losing touch with farmers or their issues. His farmer relatives won’t let him. “I joke my dad and brother think they have a direct link to me. I hear if we make a mistake,” Coppess said with a chuckle during a visit to the Illinois State Fair on Ag Day. His father and brother operate the family grain farm in Ohio and his father-in-law is an Illinois farmer (see accompanying box). “I feel fortunate to have this opportunity, to get a chance to work on the issues I care about,” Coppess told FarmWeek. “I want to put the focus on the countryside. That’s key.” Currently, those issues are getting farm disaster programs in place, he said. Final signup numbers aren’t available for the average crop revenue election (ACRE) program, but enrollment probably will be lower than anticipated, according to Coppess. He pointed out the program is complicated, requires “a lot of homework,” and is new. “It’s a new risk management tool, so it will be interesting to see how it changes
Getting to know new FSA leader
USDA Farm Service Agency Administrator Jonathan Coppess, left, chats with Illinois Farm Bureau President Philip Nelson, center, and Illinois Agriculture Director Tom Jennings on Ag Day at the Illinois State Fair. (Photo by Ken Kashian)
over time,” Coppess said. Asked about possible county FSA office consolidations, Coppess answered that is the “farthest from my mind” and declined to discuss the matter. Instead, Coppess said he is focused on modernizing FSA technology, especially its computer systems. Modern computer technology will help county offices, he said.
“My dad’s got better computer equipment in his combine than (they have) in the county (FSA) office,” Coppess said. And farmers aren’t able to link their computers to the FSA office system, he added. In addition to technology, Coppess is keeping an eye on his customers and his staff. “Farmers are our customers. We need to understand what farmers’ needs are
and understand the (local office) workloads,” Coppess said. Coppess’ former boss, Democrat U.S. Sen. Ben Nelson of Nebraska, stressed the importance of understanding constituents’ needs and issues, he said. “It made him an effective leader,” Coppess said, adding, “I took that lesson to heart.” — Kay Shipman
Jonathan Coppess was appointed administrator of USDA’s Farm Service Agency (FSA) in July. Previously he was the FSA’s deputy administrator for farm programs. Prior to Jonathan Coppess joining FSA, Coppess was the ag legislative assistant for U.S. Sen. Ben Nelson of Nebraska and worked extensively on the 2008 farm bill. Before moving to Washington, Coppess practiced law in Chicago for four years and also worked as a grain merchandiser at Archer Daniels Midland where he was responsible for commodity purchasing, processed-product sales, and related hedging activities using the Chicago Board of Trade. He grew up on his family’s corn and soybean farm in Darke County, Ohio, near Union City. He and his wife, Susan, daughter of Rock Island County Farm Bureau leader Tom Mueller, and their daughter, Abigail, live in Washington, D.C.
FarmWeek Page 4 Monday, August 24, 2009
CLIMATE Sept. 1 in Springfield
Diverse interests expected at climate rally “We felt it was important to have this all-out effort,” IFB Governmental Affairs Director Mark Gebhards told the IFB Illinois Farm Bureau is joining with board last week. “We do need to have a a broad coalition of economic interpresence — we said we wanted to go allests to make members’ voices heard out to oppose this, and we’re going all out.” on costly “cap-and-trade” proposals To watch video of last week’s Housbefore the U.S. Senate takes up federal ton rally, visit {www.energycitizens.org}. climate debate. IFB National Legislative Director Springfield’s Crowne Plaza Hotel is Adam Nielsen cited growing recognition the site for an 11:30 a.m. Tuesday, Sept. that cap-and-trade proposals would be 1, rally to address concerns about the “bad for the business community” (see potential impact of proposed greendetails at right). house emissions caps on future energy, While the National Rural Electric consumer, and farm costs. Cooperative Association has adopted an A lunch will follow the roughly 45essentially neutral stance on the plan, minute event — one of 22 rallies nationindividual Illinois co-ops wide sponsored by the group Energy Citizens to IFB’S STANCE: have joined in opposing provisions that would oppose House-approved • House cap and trade cause “a huge hit on legislation. IFB members legislation would have a coal,” Nielsen said. are encouraged to attend, negative economic impact The Senate Environand may contact their on farmers. ment and Public Works county Farm Bureau for Committee is expected additional details. • Cap and trade would have a negligible impact on to unveil a climate draft An initial rally last similar to the House bill Tuesday in Houston drew global warming. Sept. 8. an estimated 3,500 people. • Cap and trade creates a Senate Majority IFB is part of a statewide Leader Harry Reid (Dcoalition that includes the gaping hole in the nation’s Nevada) has asked that Illinois Petroleum Council, energy supply. committee and five oththe Illinois Manufacturers ers to complete a plan Association, the Illinois by Sept. 28, though Gebhards questions Petroleum Marketers Association, the “if they can keep this schedule,” given a Illinois Coal Association, the Illinois current push for health care legislation. Association of Aggregate Producers, the Senate Ag Chairman Tom Harkin (DIllinois Retail Merchants Association, the Iowa) is pushing hard for an “opt-out” Illinois Energy Forum, the National Fedclause that would suspend domestic eration of Independent Businesses, the emissions caps if key developing counIllinois Chamber of Commerce, the Illitries such as India and China fail to nois Fertilizer and Chemical Association, undertake similarly significant carbon the Illinois Oil and Gas Association, reduction efforts. Midwest Truckers, and GROWMARK.
BY MARTIN ROSS FarmWeek
IFB, meanwhile, has launched a media blitz designed to “tell the story from a farm perspective,” reported IFB media liaison Lori Laughlin. In a FOX News segment aired last week, LaSalle County Farm Bureau President Monty Whipple noted 60 percent of his own production costs are fuelrelated, and IFB President Philip Nelson cited projections that cap-and-trade
could boost annual Illinois farm costs by $11,000 to $15,000 by 2020. IFB and county Farm Bureaus are mobilizing member communications with Democrat Sens. Dick Durbin of Springfield and Roland Burris of Chicago. Producers may contact the senators with one click at IFB’s Internet Legislative Action Center {capwiz.com/ilfb/state/main/?state=IL}.
CAP AND TRADE: ILLINOIS IMPACTS? U.S. House cap-and-trade legislation could have a significant impact on the Illinois economy, health, and even education, according to a new report by the National Association of Manufacturers (NAM). The House measure sets targets aimed at reducing greenhouse gas emissions to 17 percent below 2005 levels by 2020, 42 percent below 2005 levels by 2030, and 83 percent below 2005 levels by 2050. NAM estimates the price of carbon permits — what potentially regulated companies would pay for annual carbon dioxide emissions — could reach $48 to $61 per metric ton of CO2 by 2020 and could rise to $123 to $159 by 2030. The association projected economic impacts for each state under scenarios ranging from best-case costs to the highest anticipated costs under House proposals: • Illinois would lose 88,400 jobs under a low-cost scenario and 120,340 jobs under the worst-case scenario. Higher energy prices would lead to lower industrial output, along with greater competition from overseas manufacturers with lower energy costs. • High energy prices, fewer jobs, and loss of industrial output would reduce Illinois’ gross state product by $1.7 billion to $2.9 billion per year by 2020 and $17.7 to $24.1 billion by 2030. • Illinois’ major economic sectors would be affected by emission caps. The current two largest sectors, chemical manufacturing and machinery manufacturing, show decreases in output of 6.1 to 6.7 percent and 6.8 to 8.4 percent, respectively, in 2030, according to the NAM report. All manufacturing sectors would suffer output losses between 5.4 and 6 percent by 2030, with output from energy-intensive sectors dropping 10.7 to 11.7 percent. • Illinois coal production would fall between 70.5 and 76.8 percent and electricity production would fall 9.6 percent to 16.7 percent. As a result, Illinois’ 5,955 schools and universities and 227 hospitals likely would experience a 28.2 to 42 percent increase in energy costs by 2030. NAM projections also indicate government agencies would see heightened costs for public transportation and vehicle fleets such as school buses.
Climate-based costs tough for processor to swallow Tom Eickman’s a busy man by anyone’s measure: Eickman’s Processing Co. Inc. slaughters an average of 40 head of cattle and 60 hogs a week, runs smokehouse and canning operations, and even caters area events. “We do most everything the big guys do, just on a smaller basis,” the company’s manager said. Like the “big guys,” the Seward-based retailer-wholesaler wrangles daily with a variety of labor, food safety, and market regulations. Unlike the big guys, Eickman’s deals largely with smaller producers and regional markets. Rising plant costs hit processors like Eickman’s even harder than they do larger packer-marketers, and Eickman is concerned about the impact of House climate proposals on his energy-intensive, third-generation operation. Eighteen to 20 compressors run 24 hours a day year-round to meet the plant’s refrigeration needs, and Eickman reported electricity — and gas-powered smokehouses are
running “almost non-stop.” In a business where consumer safety is key and federally monitored “hazard analysis-critical control point” (HACCP) meat handling procedures are law, cutting energy costs is a challenge. Eickman’s maintains coolers at less than 38 degrees Fahrenheit and freezers at zero, under the watchful eye of USDA and local health officials. Eickman stressed “we can’t just go through and turn compressors off.” “If any variance were to come up, your HACCP plan kind of falls apart, you’re into a lot more (safety) verification, and you’re prone to get a recall if you can’t prove that product you’re producing has been kept safe the entire time it’s been in production,” he told FarmWeek. “Most of the time, we try to absorb (higher energy costs), but we deal more with the smaller farmers. When we have to say, ‘Hey, your processing bill is going up $5$10,’ that really hurts the
smaller farmer. That $5 to $10 could mean they’ll have to shut down their operation.” Further, while farmers would be exempt from Houseproposed emissions caps, lawmakers have not clarified which industrial sectors would be required to regulate carbon
dioxide and other key emissions. The U.S. Environmental Protection Agency has identified smokehouses as a potential source of greenhouse nitrogen oxide. Eickman thus is unsure whether climate legislation
might mean new regulatory hurdles as well as higher costs. “In the meat industry, we always get lots of fun regulations coming down the pipeline — you just kind of cross your fingers that they don’t make it to us,” he said. — Martin Ross
cows and pigs, and that corn takes energy to produce,” Specht stressed. Meanwhile, the plan offers new emissions “offset” opportunities for producers and foresters who can sequester carbon dioxide or other gases in the soil. That could spur land use changes such as movement of current production acres, pasture, or grazing areas into trees, Specht said. The U.S. Environmental Protection Agency (EPA) recently estimated 18 million acres of new trees would be planted by 2020 under House measures, displacing land for food and feed production. A 2005 EPA analysis indicat-
ed most new forest acres would emerge across the Corn Belt, the Great Lakes states, and the Southeast. At the same time, Hutjens noted studies indicating highquality forages contribute more significantly to reducing bovine methane emissions than lowerquality forages and that a highgrain ration is more beneficial to emissions reductions than a forage-heavy diet. While that offers options for improving the carbon footprint of larger operations, it also points the way toward substitution of more expensive feedstuffs at a time when prime forage or crop acres could shrink in favor of new trees.
Climate Continued from page 1 subject to future regulatory demands. Currently vague emissions requirements also raise questions about how regulatory changes could affect dairy producers expanding into processing and even retail sales. “The average (dairy) herd size in Illinois is about 106 cows,” the U of I’s Hutjens added. “Is there a (regulatory) definition for 106 cows vs. someone who has 1,000 cows?” Down the feed chain Beyond direct energy/input costs, livestock producers likely would incur significantly higher feed costs under House proposals. “It takes corn to feed out
FarmWeek Page 5 Monday, August 24, 2009
AG INCOME
Economic picture ‘bleak’ for pork producers; IFB responds BY DANIEL GRANT FarmWeek
U.S. pork producers the past 22 months lost nearly $4.5 billion due to high input costs and slumping demand. The on-farm losses since September 2007 averaged about $21.37 for every market hog. And just as it seemed the industry had reached a low, new projections indicate things could get even worse this fall. “The outlook for fall is bleak,” said Don Butler, president of the National Pork Producers Council (NPPC). “Losses are projected in the neighborhood of $54 per head.” Breakeven prices shot up from about $40-plus per hundredweight in 2006 to $60-plus in recent years as prices for feed inputs increased dramatically, according to Steve Meyer, president of Paragon Economics. Meanwhile, slumping demand
caused by confusion about the outbreak of H1N1 influenza, which was mislabeled “swine flu,” from April 24 through the end of the year is expected to gouge producers for an additional $1.25 billion in losses. “Losses occurred the past two years because of high input costs,” Butler said. “But, to add yet more misery, the H1N1 influenza was mislabeled swine flu and it exacerbated the pork industry’s financial problems.” Illinois Farm Bureau last week responded to the situation by sending a letter to Ag Secretary Tom Vilsack. IFB requested USDA press for immediate opening of export markets; encourage the active use of any public programs to move more pork; urge the immediate approval of pending free trade agreements with South Korea, Colombia, and Panama; and meet with industry
Taking it to the streets
Educator touts the facts about the pork industry Bill Fisher, an animal science educator at the University of Illinois, has been trained through the National Pork Board (NPB) Operation Main Street Program to speak with consumers and clear up misconceptions about the pork industry. But Fisher, who lives in Champaign County and is one of about 720 speakers nationwide who went through the NPB program, found when he talked publicly in downstate Illinois Bill Fisher about the pork industry he basically was “preaching to the choir.” Therefore, he turned his attention to the third-largest market for pork in the U.S. — Chicago. “I volunteered to go into the Chicago market. There’s an urban audience that’s a lot less informed and one more generation removed from agriculture,” Fisher told FarmWeek. “They don’t see corn and beans during their morning commute.” Fisher this week will give a presentation titled “The Pork Industry: More Than Just the Other White Meat” at the South Rotary Club of Chicago (Wednesday), the Lions Club of Joliet (Thursday), La Villa Restaurant and Pizzeria in Chicago (Thursday), and the Rotary Club of Lansing (Friday). His presentations will focus on what the pork industry is doing to protect the environment, treat animals in a humane manner, and enhance the nutritional quality of pork. U.S. pork producers since 1983 have trimmed the fat content of pork by 31 percent. “We (in the pork industry) are working to constantly improve our ability to provide tasty, affordable, and nutritious pork products in a responsible manner,” he said. Fisher also will focus on presenting accurate information about the H1N1 virus, which in April was mislabeled “swine flu” by some media outlets and government agencies. “It potentially could be a big issue (again) with the upcoming flu season,” Fisher said. “I hope I can get the proper information out there. “People are so confused about it (H1N1),” he continued. “Some people are afraid to eat pork, to handle pork, and they think pigs gave it to people. Obviously we’re seeing its effects in the marketplace.” People cannot get the hybrid H1N1 flu from eating or handling pork. The virus is spread human-to-human, according to the Centers for Disease Control and Prevention. However, a reduction in pork demand and disruption of markets caused by confusion about H1N1 this year still could total more than $1 billion in losses for pork producers, according to a recent estimate. — Daniel Grant
leaders to develop public policy goals that promote future competitiveness of the hog industry. “Hog futures continue to decline as have cash prices,” IFB President Philip Nelson, a pork producer from LaSalle County, stated in the letter. “Moreover, speculation about the upcoming flu season and its potential impact is rattling the market.” Hog futures that were near $70 per hundredweight prior to the H1N1 outbreak last week hovered in the low-$40 range.
“Futures prices imply lower cash hog prices through next April,” NPPC’s Butler said. “That suggests lower income levels for producers.” Butler said the situation already has forced some hog producers out of business and if the trend continues, it could lead to the loss of thousands of jobs in rural America, reduced pork production, and ultimately higher food prices. NPPC last week also sent a letter to USDA urging it to use
various federal food programs to purchase as much as $250 million worth of pork that would benefit needy consumers who are struggling due to the recession. NPPC further requested that of the $1 billion appropriated to address the H1N1 virus $100 million be used by USDA to aid the swine industry through disease surveillance, diagnostics, and development of a vaccine. The Illinois Pork Producers Association endorsed the NPPC letter.
Growers better equipped to set ACRE priorities BY MARTIN ROSS FarmWeek
With Illinois’ four major commodities tentatively “in the money,” some newly enrolled ACRE (average crop revenue election) program participants have at least one more major decision to make. Based on 2009 projected revenues — the product of projected average state yields and national price estimates derived from USDA’s Aug. 12 crop report — ACRE payments would be triggered for Illinois corn, soybeans, wheat, and oats. For a producer to receive payments, individual losses must trip a farm benchmark trigger based on his five-year Olympic average ACRE yield and/or county “plug-in” yields. Coverage is limited to a farm’s total base acres (producers receive payments on 83.3 percent of
planted acres), but any acres over base are ineligible for payments. Under currently projected revenues, Illinois growers could see payments of $27 per acre for corn, $12 for beans, $51 for wheat, and $42 for oats. (See chart) New projections are important to producers who have more planted acres than base acres, who are allowed either to prorate prospective payments across all crops according to each crop’s percentage of the total planted acres, or prioritize which crops are to be covered first. Eligible growers have until Sept. 30 to make that decision, or their payments will be automatically prorated. “If they think a certain commodity has a higher likelihood of meeting their farm trigger than another commodity, they may give that commodity a higher priority, especially this year,” Illinois
Farm Bureau risk management specialist Doug Yoder explained. “As an example, if someone had his corn planted on time and it looks good, but got beans in really late and is worried about them, the beans may have a higher likelihood of triggering payments compared with corn.” Weather-related corn lodging concerns or unexpected pest pressures also could influence payment prioritization. Final ACRE prices have been set for wheat ($6.63 per bushel) and oats ($2.89), but the prices of $4.13 for corn and $10.05 for soybeans are preliminary. Further, currently projected state yields are based on National Agricultural Statistics Service (NASS) harvest estimates, while ACRE yields will be based on total state production divided by planted acres, once NASS publishes final Illinois yields.
Estate tax reform mobilizing IFB The clock is ticking on 2009 federal estate tax debate, and Illinois Farm Bureau is urging grassroots action to blunt the future impact of the so-called “death tax.” Congress soon will debate whether to maintain the current estate tax exemption at $3.5 million a person and the top rate at 45 percent. American Farm Bureau Federation is encouraging beginning farmers in particular to sign a petition aimed at reducing “the negative impacts estate taxes have as (young farmers) look to start or expand their operations.” To support the petition, visit IFB’s Legislative Action Center at {capwiz.com/ilfb/state/main/?state=IL}. IFB hopes to obtain at least 250 Illinois signatures, and will offer Farm Progress Show visitors a chance to sign the petition. Estate tax action is expected this fall — without congressional action, the tax will be eliminated in 2010 but could and likely would return at pre-2002 tax rates and a $1 million individual exemption in 2011. That concerns both estate tax opponents and lawmakers worried about losing a federal revenue source in 2010, and IFB National Legislative Director Adam
Nielsen believes some sort of action will be taken to address estate tax “sunset” and reinstatement. At the least, IFB urges Congress to boost the estate tax exemption to the highest level achievable — President Obama has voiced support for a $10 million-per-couple exemption. IFB favors maintaining “stepped-up basis” — under which an heir’s estate tax basis equals fair market value of property at the time a producer dies, meaning less taxable gain when the property eventually is sold — and increasing gift tax exemptions to reduce estate tax liability prior to death. Farm Bureau supports two estate tax bills currently on the congressional radar. The Death Tax Repeal Permanency Act would scrap the tax altogether. Supporters include the National Taxpayers Union, which in an August letter to congressmen, argued the estate tax “punishes thrift, savings, and hard work — three attributes that are absolutely imperative to getting our economy back on track.” A second Farm Bureau-supported bill, the American Family Farm and Ranchland Protection Act, would boost estate tax exemptions for conservation easements. — Martin Ross
FarmWeek Page 6 Monday, August 24, 2009
CROPWATCHERS Bernie Walsh, Durand, Winnebago County: Good growing conditions again last week with a little cooler temperature than we would like. We had 0.5 of an inch of rain with showers on Wednesday and Thursday, but no bad storms. There is still some white mold spreading in the soybeans, but very little spraying for insects. I am reporting from the Lake of the Ozarks and was able to see good looking corn and beans all the way through Illinois and into Missouri. The crop is definitely behind schedule and uneven in some fields, but in general looks good. Pete Tekampe, Grayslake, Lake County: We received 1.5 inches of rain last week in three different showers. Early corn is looking good, while later-planted corn shows signs of spring problems. Beans are looking good, but time is ticking away. Hopefully, we have enough time left for them to mature. Not much hay baled last week, but second cutting is starting to dry up. All we need now is some sun and heat to speed up the process, but cooler temperatures are in the forecast. Leroy Getz, Savanna, Carroll County: Rain for the week totaled 1 inch. Total for August, 3.3 inches. Corn is developing nicely with adequate moisture and favorable temperatures. We have good ear counts. Corn is starting to dent. Some soybeans have been sprayed for aphids. Wet conditions favor many soybean diseases. A visiting relative from Texas could not believe how green everything is in Illinois. Ron Frieders, Waterman, DeKalb County: Dry soils and heat stress are not an issue this year. A total of 4.75 inches of rain last week recharged topsoil and should really help with ear fill and pod set. Crops are still behind in maturity, and cool temperatures this summer are prolonging the time crops will be vulnerable to frost. Cool and wet conditions also are setting up a perfect storm scenario for white mold. Some fields have outbreaks, and scouting is very important so you know if you should apply a rescue treatment. Lots of combines are out of storage for preseason inspections and repairs. Grain dryers and bins, as well as grainhandling equipment, are being scrutinized as harvest preparation is in full swing. Larry Hummel, Dixon, Lee County: I looked back at the report I wrote last year on Aug. 22. A couple of things really caught my eye. Early-planted corn was starting to dent. I haven’t seen anything close to that yet this year. And I mentioned $5 corn prices. Wow! Now we are looking at fall prices below $3. One thing that is similar to last year is aphid populations. They are increasing, but not at threshold levels yet. Last year, we ended up spraying all our beans for aphids. With ample moisture and very little stress in the plants, I might wait a little longer to spray this year and see if aphid populations crash on their own. Joe Zumwalt, Warsaw, Hancock County: It seems that Western Illinois has turned into a rainforest. Over the past few days (Aug. 16-19), I received almost 8 inches of rain. All I can say is that it is a good thing the crops are tall so they can hide the standing water. But in reality, I don’t think the rainfall hurt us a whole lot, except for some very severe erosion in areas. Crops look better all the time, but they are very deceiving. Cropdusters have been busy spraying beans and the pilots bring back stories of some pretty sickly looking fields that they have seen from the air. Cool temps and this rain continue to push back harvest as well. It is now looking like late September before any combines are rolling.
Ken Reinhardt, Seaton, Mercer County: I had 2.5 inches of rain for the week, some had closer to 4 inches. We may have had a record low high temperature Friday. Crop development is lagging giving more time for problems to develop. Sudden death and white mold are starting to affect soybeans, along with aphids. Various leaf diseases are increasing in corn. Some hybrids are being hit hard with northern leaf blight.
Brian Schaumburg, Chenoa, McLean County: Three inches of rain this past week should quiet fears that the crop would run out of moisture. Corn is in the milk to early dent stage. Soybeans are at R3 to R5. White mold is a continuing concern. Harvest prep is starting. Yield checks are coming, and I should have an estimate next week. Corn, $3.13; fall, $3.02; soybeans, $10.48; fall, $9.23; wheat, $3.76.
Ron Moore, Roseville, Warren County: We received 3.5 inches of rain last week. Needless to say we are very wet. Cooler temperatures also are here. We are still several weeks away from even starting to mature this crop. It is still a struggle to find three to four days of dry weather to mow the last cutting of hay. One of the bright spots of all of this moisture is the pasture conditions are the best I have ever seen for the middle of August. We have plenty of grass to keep the cattle satisfied and not feed any extra hay.
Wilfred Dittmer, Quincy, Adams County: The sump pumps are finally getting a break this Friday morning after working overtime the last few days. As one person said, we should not complain about rain in August. But it is getting a little excessive since my gauge picked up 8.8 inches since last Sunday (Aug. 16). Of that, 3.5 inches came on Wednesday afternoon in about one half hour. That brings our August total to 11.4 inches and 34.6 for the year. So if crops need 1 inch per week, this should be enough for the rest of the year. Some building damage occurred in the area that day with the strong winds and a little hail. Corn and soybeans withstood the wind pretty well as far as one can see. It certainly could have been a lot worse.
Jacob Streitmatter, Princeville, Peoria County: Rains for this past week totaled around 2 inches. Soybeans have been the crop of talk around here. A lot of aphids have shown up recently, and white mold is also a concern. My soybeans have a long ways to go. I sure hope they get more than a couple of pods per plant. Most of the corn is either close to or done pollinating. I have not found many diseases in the corn yet this year. I think we need some consistent warmer weather to push the crop along so it can reach maturity before a frost. Mark Kerber, Chatsworth, Livingston County: What a difference a week can make. We went from hot and dry to wet and cool. Much of our area received well over 2 inches of rain last week. What a critical rain as thunderstorms rolled through, although not all areas received this rain. There are a few reports of white mold showing up in some older numbers of soybeans. Some agronomist tells us that spraying will not help. Farmers are gearing up for fall, getting machinery and bins ready. It looks like we will have plenty of time to attend the Farm Progress Show in Decatur. Markets are bottoming, reflecting the size of this crop. Ron Haase, Gilman, Iroquois County: The rain finally returned to our area. From Sunday through Thursday (Aug. 16-20) the area received from 1.5 to 3.3 inches of rain. Most of the cornfields in the area are anywhere from the milk stage (R3) up to the dent stage (R5). Did the dry weather reduce kernel size and depth? Most soybean fields are in the beginning seed growth stage (R5). Most conversations about soybeans revolve around the presence of white mold. The local closing prices for Aug. 20: nearby corn, $3.11; new-crop corn, $3.05; nearby soybeans, $10.41; new-crop soybeans, $9.35. Plot tours have begun and many farmers have been learning more about what hybrids and varieties will be for sale in 2010. Steve Ayers, Champaign, Champaign County: Another textbook weather week with a total of 1.6 inches of rain and moderate temperatures since last Sunday (Aug. 16). One crop threat now is the thunder boomers that rumble through with high winds and hail. We had one Wednesday evening that resulted in minimal damage. Corn is in blister stage with bean pods filling well. Aerial tours indicate lots of ponds like last year. The Pro Farmer crop tour put our district’s corn at 163.04 bushel per acre vs. a three-year average of 171.09 and bean pod count in a 3 x 3 square at 1,171.01 vs. a three-year average of 1,384.93. Illinois’ yield was put at 166.94 and a 1,102 pod count, down a bit from average. See you at the Half Century of Progress event in Rantoul Thursday through Sunday.
Harry Schirding, Petersburg, Menard County: Rainfall last week totaled 3.35 inches. Total for August, 4.54. Normal for August, 3.5. Storms on the 18th and early 19th gave most of the county at least 3 inches but caused little damage. A lot of variability in the corn yield potential is seen between variety, location, planting date, and tillage practices. With silage harvest still a few weeks away, many producers are planning for a harvest that starts late and continues well into November. Some are considering control measures for aphid populations that are approaching threshold levels. The first signs of sudden death syndrome are appearing in scattered soybeans fields. If the weather will cooperate, there should be time for one more cutting of hay. Corn nearby, $3.09, down 11 cents; soybeans nearby, $10.22, down $1.17; January corn, $3.04, down 8 cents; January soybeans, $9.45, down 62 cents. Tom Ritter, Blue Mound, Macon County: This past week most people received just short of or in excess of 3 inches of rain in two different rains. Needless to say, we were very much in need of that moisture. It will be a major benefit to the soybeans and some benefit to the corn. We are starting to see maturing in the little bit of corn planted in April. Most corn, though, is well off. Accompanying the rain were some high winds, which tended to lean and flatten some corn, but that is not a major problem. That will, however, make harvest a little more trying, as will having to handle the higher moisture that we will probably have. Overall, farmers seem to be fairly optimistic that we can have decent — which means average — yields, but there will be lots of areas in the fields that may pull that average down. Soybeans are extremely short, but it is too early to tell about yield. Todd Easton, Charleston, Coles County: We received the rain I said we needed last week in most areas with accumulation ranging from just over 0.1 of an inch to just under 1 inch. From what I have seen, it will do the corn some good and the beans a lot of good. Our Coles County Extension office hosted a countywide corn yield check and asked me to participate in one of the groups. The final countywide estimate came out to be 154.5 bushels per acre, which was disappointing to most all who participated. We all saw quite a bit of tip back that seems to have occurred in the last week and a few pollination issues. Another observation I would make personally is that producers who pushed their populations to the high side will be rewarded for doing so when the combines roll. As for the soybeans, they really appreciated the rain and are doing well for now, but have a very long way to go and really need things to go right.
FarmWeek Page 7 Monday, August 24, 2009
CROPWATCHERS Jimmy Ayers, Rochester, Sangamon County: This past week we received 2.5 inches of rain in storms that caused quite a bit of damage in the county. We had a tornado tear up 26 homes, several businesses in town, a church, and many crops in one area. There was another tornado just south of Springfield. Quite a few trees were hit pretty hard. Several families were affected by the storms. Crops are still growing and look very good. We still have fields that are a little short on nitrogen and are not drying up like normal for August. The Sangamon County Fair went off well with some of the events canceled due to the rain. The week wasn’t good for hay. Just a few guys were mowing roadsides. Doug Uphoff, Shelbyville, Shelby County: We returned from vacation to hot and dry weather. We did, however, receive 1.2 inches of rain — just what the doctor ordered. The southeast part of the county received 3.3 inches and severe wind damage. Some cattle were killed when a barn was blown over on them, and corn was green snapped. One field of beans that had previously been damaged by hail was finished off with straightline winds. Some leaf disease in showing up in cornfields. Beans are anywhere from R1 to R5, and most corn is in the dough stage. We definitely do not need an early frost. Fertilizer and seed decisions are in the early stages. Prices I have heard for fertilizer are $415 for NH3, $400 for DAP, and $600-plus for potash. Cash corn, $3.15; fall, $2.94; January, $3.09; fall 2010, $3.40; cash beans, $10.22; fall, $9.37; January $9.49, fall 2010, $8.89; wheat, $3.69; 2010 wheat, $4.25; farm diesel, $2.33; farm biodiesel, $2.20; road diesel, $2.81; road biodiesel, $2.66; gas, $2.54. David Schaal, St. Peter, Fayette County: We had several showers at different times in the past week, but the rain gauge accumulated only about 0.08 to 0.09 of an inch. Places in the county had strong storms on Wednesday evening with high winds and some hail. Crops continue to progress. Just to repeat my last report, we are a month behind. No pest problems. We keep talking of a big corn crop, and grain prices seem to show it. We need to be gearing up for harvest, but nobody around here is getting too excited about it yet. Still some soybean spraying going on, along with some mowing.
Ted Kuebrich, Jerseyville, Jersey County: Jersey County received between 1.5 and 3.5 inches of rain last week. The heavier rain fell in a five-mile radius of Jerseyville. I reported last week that the corn crop was looking very good. The cornfields that I was reporting on were on some rolling land on our farm at Fieldon. Last week I went down to the Illinois River Bottom and the corn shows stress with all the rain that we have been having. On the rolling ground, the rainwater is able to run off. The bottom ground is inside of the levy and with the Illinois River raising and lowering, there is more of a chance for the water to pool, causing nitrogen loss. Cash corn, $3.27; new corn, $3.04; January corn, $3.14; cash beans, $10.08; new beans, $9.45; January beans, $9.58. Dan Meinhart, Montrose, Jasper County: Rain accompanied by strong winds moved through the area Wednesday evening along the Interstate 70 corridor. As much as 5 inches fell in a short period of time, causing flooding and soil erosion. There is a large area to the south that is still in need of rain. The late-June planted corn is just now beginning to tassel. The beans are blooming, but very few pods have been set. Given the reports crop scouts released this past week, it is obvious they did not come to this part of the state. We still need a lot of moisture and growing degree days to make a crop. Cooler temperatures are predicted for this week with only a slight chance of rain. Bob Biehl, Belleville, St. Clair County: We received 3 inches of rainfall in three different rain events this past week without any serious storm or wind damage. The rain was welcome, as both corn and beans were beginning to show stress. Our corn is in the green fill stage and beans are still trying to add some height and blooms. Pods are not prevalent in many fields. Grain markets really turned south. Old-crop beans lost $2 per bushel in three Chicago Board trading days. Hard to believe. Wheat in the bin is worth about $2 per bushel after all the discounts. Reports received Friday morning.
Rick Corners, Centralia, Jefferson County: We had a total of 1.04 inches of rain in four different showers last week. It’s not muddy, but it sure was appreciated. It’s hard to believe in a week it will be the first of September. As Jerry Reid used to say, “We’ve got a long way to go and a short time to get there.” Kevin Raber, Browns, Wabash County: Rainfall amounts of 0.5 to 0.75 of an inch fell last week. You can see the early corn drying down. Some of the late corn still has a way to go. There seems to be a lot of sudden death starting up in the early-planted beans. Everyday it seems to be getting worse. Next week, I will have some corn yield estimates for our county. Dean Shields, Murphysboro, Jackson County: We had 2 inches or more of rain last week. We really didn’t need all of that, but we got it anyway. Because of the heavier rains to the north of us, the Mississippi River is forecast to go to about 20 feet on the Chester Scale, which means our locks will be closed. It is unusual to have the locks down in August in our area. Farmers are concerned about getting heavy rain and some internal flooding because of it. The rest of the county seems to be doing OK with all the rain. The corn and beans look good in the well-drained areas. Just need to turn the spicket off a little bit! Milo is headed out pretty nicely now and coming along OK. There are not that many acres this year. We are getting the equipment out and ready to go. Just thinking about harvest. Ken Taake, Ullin, Pulaski County: It was a pretty calm week here in deep Southern Illinois. A lot of showers went through, but we received only about 0.4 of an inch of rain. We could have used a little more, but we are thankful for what we got. Grass in the yards is still growing well, so growing conditions must be good for the crops also. We are counting down the late-summer activities, and people are starting to get ready for harvest. The crops certainly are going to be late as far as harvest goes.
Illinois corn yield projected at 167 bushels per acre BY DANIEL GRANT FarmWeek
The crops in Illinois generally look healthy from the road. But a closer look at the fields of corn and soybeans conducted last week by participants of the Pro Farmer Midwest crop tour revealed signs of stress. “We’re seeing tip backs (on corn ears) of an inch or more due to either a lack of pollination or (kernel) abortion,” Roger Bernard, director of the eastern portion of the tour and Pro Farmer editor, told FarmWeek
last week during a tour stop near Chenoa in McLean County. The Midwest crop tour
FarmWeekNow.com For more information on the results of the Pro Farmer crop tour, visit FarmWeekNow.com.
officially estimated an average corn yield in Illinois of 167.1 bushels per acre. The estimate is well below the USDA projection earlier this month of 175 bushels per
Weather Continued from page 1 as of last week were 7.6 inches in Quincy, 3.18 inches in Peoria, 2.9 inches in Springfield, 2.77 inches in Carbondale, 2.2 inches in Rockford, and nearly 2 inches in Chicago and St. Louis, Shimon reported. “Overall, we’re already at or above normal rainfall totals for the month in a lot of areas,” he said. However, some portions of the state were dry through the first two weeks of the month, particularly on the eastern side of the state, according to the National Agricultural Statistics Service Springfield office. Topsoil moisture as of the first of last week for the state was rated 70 percent adequate, 21 percent short or very short, and 9 percent surplus.
acre and would be down 12 bushels per acre compared to the average yield a year ago. “There just weren’t those big yields that one almost expects to see out of Illinois,” said Bernard, who noted an estimate in an Iroquois county field totaled about 165 bushels per acre. “We talked to the grower, and he said it would be a 200-bushel crop in a normal year, but this year he didn’t get it planted until May 15.” A breakdown of the specific tour observations and results can be viewed online at {www.AgWeb.com}. The Midwest crop tour does not estimate yields for soybeans. “Everybody knows August is the key month for beans” to determine yield potential, Bernard noted. Tour participants did, however, conduct soybean pod counts and in Illinois those counts were down about 15 percent compared to last year’s tour. Yield-robbing problems such as sudden death syndrome and white mold, which are common in wet years, were found in soy-
Roger Bernard, director of the portion of the Midwest crop tour sponsored last week by Pro Farmer and editor of the publication, counts bean pods in a field near Chenoa. Tour participants found pod counts in Illinois this year are down about 15 percent compared to last year’s tour findings. (Photo by Daniel Grant)
beans during the tour. “Pod counts are variable,” Bernard said. “And we have noticed we’re not seeing the bean height we’re used to seeing, although a big bean plant doesn’t always translate into a big bean crop.” The crops in Illinois also are noticeably behind average maturity dates, Bernard noted.
Six percent of the corn crop last week was in the dent stage compared to the average of 40 percent while 58 percent of soybeans were setting pods compared to the average of 87 percent, USDA reported. “We’re going to need a favorable finish to the growing season across much of the eastern Corn Belt,” Bernard added.
FarmWeek Page 8 Monday, August 24, 2009
PRODUCTION
Prices for new seed genetics expected to increase BY DANIEL GRANT FarmWeek
Farmers likely will have to pay more for seeds in 2010, particularly for new varieties
FarmWeekNow.com Listen to Monsanto’s explanation of seed pricing for 2010 at FarmWeekNow.com.
that are projected to boost yields. Brett Begemann, an executive vice president for Monsanto, told FarmWeek that seed prices for the upcoming season could see single-digit increases. He met last week with the
Illinois Farm Bureau Board of Directors in Bloomington to discuss the issue. The cost of Roundup Ready 2 Yield, for instance, was projected by Monsanto to increase from a weighted average of $69 to $72 per acre in 2009 to $74 per acre in 2010. Meanwhile, the cost of Roundup Ready beans for 2010 was projected to remain flat or post a slight increase at a weighted average of $52 per acre compared to a range in 2009 of $49 to $52 per acre. “I think we’ll see low, single-digit price increases” Begemann said. “For triple stack corn, (farmers) could
see everything from a flat price up to a high single-digit increase.” The cost of Genuity SmartStax, Monsanto’s new eight-gene corn product, could be about $19 more per acre than triple stack varieties. However, SmartStax is projected to improve yields by about 10 percent. Farmers who plant SmartStax will be able to reduce their refuge requirement from 20 percent to 5 percent. “We like to say we price the stuff to the value it creates,” said Michael Dykes, vice president of government affairs for Monsanto, who recently met with IFB Mar-
keters to Washington participants. Monsanto’s pricing is based on the value its products deliver compared to other available seed products, according to the company website {www.monsanto.com}. And Monsanto spends about $3 million per day on research and development to produce crops that have higher yield potential, according to Dykes. “As long as corn prices are around $1.80 (per bushel) or higher and soybeans are $6 and higher, farmers will be
better off growing Roundup Ready 2 Yield (beans) and SmartStax (corn),” Begemann said. Seed production for 2010 will include an estimated 8 million acres for Roundup Ready 2 Yield and 4 million acres of SmartStax. Meanwhile, glyphosate prices in 2010 likely will decline: Dykes projected Monsanto will operate its production facilities at or close to full capacity. “We’ll adjust our prices and be more competitive with China in the marketplace,” he added.
Soybean rust moving — slowly BY KEVIN BLACK
Still time to file EQIP, WHIP applications Illinois landowners still have time to submit applications for the environmental quality incentives prog ram (EQIP) and the wildlife habitat incentives prog ram (WHIP) before remaining funds are allocated, according to the Natural Resources Conser vation Ser vice (NRCS).
“We have a bit of EQIP and WHIP funds remaining and are holding batching periods ever y Friday until the funds are g one. So get those applications in and get them in quick!” said Paige Buck, NRCS state public affairs specialist. For more infor mation, visit your local USDA Ser vice Center.
Asian soybean rust has recently been found at low levels in west-central Mississippi and southeast Arkansas soybeans, marking a new northward infection point for the season. The lack of tropical weather systems in the Gulf of Mexico, up to now, makes the prospect of possible Midwestern soybean rust infections unlikely. The remnants of tropical storm Claudette and prospects of a strike by Hurricane Bill may rapidly change the soybean rust situation in the South, but should not appreciably change the situation in the Midwest. Kevin Black Historically, tropical weather systems have provided conditions favorable for disease development and for northward transport of rust spores. Some soybeans are being harvested in Louisiana and other southern areas. One observer reported that this activity was resulting in clouds of dust and spores being thrown into the air. However, even if viable spores arrived in Illinois today, it would take four to six weeks for the disease to build up to detectable levels, and then another two to three weeks for the disease to get to damaging levels. Frankly, this once again makes the risk of frost a greater threat to the soybean crop than the risk of soybean rust. Kevin Black is insect and plant disease technical manager for GROWMARK Inc. His e-mail address is kblack@growmark.com.
SWEET DEAL
Todd and Mindy Smith of Waverly in Sangamon County munch on sweet corn grown on Twin Garden Farms, Harvard, sold in the Illinois Specialty Growers tent at the Illinois State Fair. The Specialty Growers also sold melons, peaches, and apple cider all produced on Illinois farms. (Photo by Ken Kashian)
FarmWeek Page 9 Monday, August 24, 2009
AGRONOMY DAY
Farmers encouraged to know, heed soil fertility levels BY KAY SHIPMAN FarmWeek
Soil fertility varies across Illinois, but some fields don’t need more phosphorous or potassium to maintain crop yields, according to a University of Illinois soil fertility researcher. “If your soil fertility is high, you can remove the crop, not apply (fertilizer), and still do well,” Fabian Fernandez told farmers attending the recent U of I Agronomy Day. Fernandez reported the results of random soil sampling in more than 50 counties scattered throughout the state over the past two years. Of the tested fields, about 55 percent had phosphorous levels above U of I recommended rates. “A lot of fields have a lot of fertility,” he said. Potassium levels were distributed more evenly among sampled fields. About a third of tested fields had rates above recommended potassium levels, a third tested within recommended levels, and the remaining third was
below U of I recommended levels. “From the survey, we learned fields (potassium levels) are well above or well below recommended rates. You need to know your soil survey levels,” Fernandez advised. However, many farmers already have soil test information at their fingertips, based on the survey results. Eighty-two percent of farmers whose fields were sampled said they have their fields tested every four years, while 11 percent said they have testing done at least every two years. And a majority of surveyed farmers, 58 percent, agree with the U of I’s soil fertility level recommendations, Fernandez noted. To improve crop efficiency of phosphorous and potassium soil levels, farmers should manage the root zone with good soil drainage, low soil compaction, and little weed competition, he recommended.
Pasture walk slated for Saturday A pasture walk and program will start at 11:30 a.m. Saturday on the Elton and Spring Mau farm at Arrowsmith in McLean County. The farm is located on county roads 31086 E/1300 N. Mau, a member of the Illinois Grazing Lands Conservation Initiative Committee, has 300 head of ewes and lambs in his pasture-based operation. The program will start at 11:30 a.m. and a meal will be served. The pasture walk will take place from 12:45 to 2:30 p.m. Mau has an extensive mix of forages for summer, fall-winter, and winter grazing. From Bloomington, take Route 9 east for about 6.5 miles to Road 2300 E. Turn south or right and go for a mile to the intersection of 1300 N Rd. Turn east or left on 1300 N. The Mau farm is 8.5 miles east on the north side of the road. Those coming from the east on I-74 should take the LeRoy exit and go north on Route 150. At the four-way stop turn left or west and travel about a half mile until coming to a Casey’s on the north side of the road. Turn north onto county road 2600 E and drive eight miles to 1300 N. Turn right or east onto 1300 N and go 5.25 miles to the Mau farm. For more information or to reserve a meal, call Richard Cobb at 217-333-7351 or Mau at 309-825-5435 or e-mail maufarm@mindspring.com.
Learn-from-home class on farm business plan offered Whether you’re a farmer who needs an increased credit line to expand your operation or a landowner seeking topnotch farmers to operate your farm, you’ll get help obtaining the information you need in an online training program offered by the University of Illinois Extension. The registration deadline is Sept. 7. During the class, participants will use a template to build a written plan to help them reach their business goals. Through e-mail and telephone support, the instructor will offer feedback on improving the plan. The e-mail class will begin Sept. 11 and end by Dec. 15, or earlier if the plan is completed earlier. Lessons will be accessed by e-mail and participants may study at their own pace. Computer access and e-mail are required. The cost is $65. To register, log on to {http://web.extension.uiuc.edu/champaigncenter} or contact Kevin Brooks at kwbrooks@illinois.edu or 217-3334901.
Fabian Fernandez, University of Illinois professor of soil fertility and plant nutrition, reports on soil fertility recommendations and fertilizer prices recently during Agronomy Day at the U of I. (Photo by Kay Shipman)
FarmWeek Page 10 Monday, August 24, 2009
MARKETS
IFB to offer photos with Abe at Farm Progress Show The start of harvest may be a ways down the road, but the Farm Progress Show is just around the corner. The annual event, billed as the nation’s leading outdoor farm show, will return to Decatur Sept. 1 through 3. Farmers who attend this year’s show as always will get a preview of new products and services in the ag industry, a chance to test-drive new equipment, and the opportunity to meet and talk with industry leaders. Tickets at the door will be $10 per adult and $5 for students 13 to 17 years of age. Farmers in Illinois who order their tickets online at {www.FarmProgressShow.com} can save $3 per ticket.
That website also can be used to view the daily schedule and get directions to the show. Illinois Farm Bureau will host an exhibit tent and for the third year in a row will offer free souvenir photographs. “This year’s photo is truly commemorative,” said Steve Simms, IFB promotion and graphic arts director. “The backdrop features Abraham Lincoln on an Illinois farm. It’s just another way Illinois Farm Bureau is celebrating the 200th birthday of the man who shaped American agriculture.” The IFB exhibit also will feature membership benefits, information about the growing Young Leaders program, and
up-to-date weather and market information each day. More details about the IFB exhibit are available online at {www.ilfb.org}. Elsewhere at the show, Country Financial will offer participants at its booth a chance to calculate their financial security through an interactive computer program. Visitors can use the Country Crop Estimator to predict corn and soybean harvest yields given different weather scenarios. Country also will give away a Cub Cadet lawn tractor and 12 rocking chairs. “As the largest farm insurance provider in Illinois, Country is dedicated to helping clients achieve financial security,” said Sheri Bane,
director of commercial agribusiness and product development at Country. Meanwhile, GROWMARK will make its presence felt throughout the event as the FS system is the official supplier of the Farm Progress Show. FS staff provided seed,
agronomic recommendations, and full-season support of demonstration plots. FS also is the official fuel supplier of the show and will provide Dieselex Gold Soy Biodiesel and gasoline for all field demonstrations, tram transportation, and show support vehicles.
Cattle market may be close to bottoming out BY DANIEL GRANT FarmWeek
The USDA cattle on feed report released Friday may have some negative implications on the market near-term. But long-term prospects suggest current prices may be
near a bottom and the market could be poised to improve, according to Dale Durchholz, AgriVisor market analyst. Placements in feedlots during July (1.86 million head) were up 13 percent from a year ago and were on the high end of trade expectations. Cattle prices through the end of last week continued to hover in the low $80s. “I suspect that as you step back from the fray and look at the fact that corn prices eroded from mid-June to mid-July, it gave a little incentive for people to place animals a little more aggressively,” said Durchholz. The Aug. 1 inventory of cattle and calves on feed (9.6 million head), on the other hand, was down 2 percent compared to the same time last year. Meanwhile, marketings of fed cattle (1.93 million head) were down 5 percent from a year ago. Durchholz believes the combination of a smaller inventory of cattle and the potential for a seasonal uptick in demand could boost cattle prices. Last year, weekly beef output dropped 13 percent from summer into fall, according to Durchholz. This year’s decline could be slightly larger (see Cash Strategist on Page 15) “I think we’re getting ready to turn the corner,” he said. “I think cattle prices (later this year) could get into the low $90s.”
FarmWeek Page 11 Monday, August 24, 2009
FROM THE COUNTIES
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UREAU — The fall task force meeting will be at 6 p.m. Tuesday, Sept. 8, at Wise Guys, Princeton. Members will be able to choose from four main task force committees to participate: education, member relations, farm business, and government and policy. Meetings are held only twice a year. Call the Farm Bureau office at 815-875-6468 for more information. UMBERLAND — The Cumberland County Fair runs through Saturday. Stop by the Farm Bureau booth and register to win daily prizes. The 4-H livestock auction will be at 6 p.m. Thursday. • A regional farm talk meeting will be at 9:30 a.m. Thursday, Sept. 3, at the Holiday Motel, Olney. Call the Farm Bureau office at 217849-3031 by Wednesday for reservations or more information. • The membership picnic will be at 5:30 p.m. Thursday, Sept. 3, at the Toledo Reservoir Park. Call the Farm Bureau office at 217-8493031 by Tuesday, Sept. 1, for reservations or more information. • Farm Bureau has Farm Progress Show tickets available for $7 at the Farm Bureau office. The show is Sept. 1-3 at Decatur. • The Illinois Ag in the Classroom bike ride will be coming through Cumberland County Sept. 8-10. Those interested in biking or showing support should contact the Farm Bureau office for more information. ENRY — The marketing seminar series will continue at 6:30 p.m. Monday, Aug. 31, at Glory Days, Geneseo. Rob Huston, AgriVisor LLC, will be the speaker. This is the third of four seminars. A buffet dinner will be served. Cost is $18 (unless paid for the series). Call the Farm Bureau office at 309-937-2411 or the Extension office at 309-8531533 for reservations or more information. ANKAKEE — The annual legislative reception will be held in conjunction with the Kankakee Regional Chamber of Commerce from 5 to 7 p.m. Wednesday at the Kankakee Country Club. Cost to attend is $30 for Farm Bureau members and $60 for non-members. Don Daake, Olivet Nazarene University, will lead a panel discussion involving area business leaders, state and national legislators, and representatives from at least one state constitutional office. Call the Farm
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Bureau office at 815-9327471 for more information. ONROE — The Mon-Clair Corn Growers test plot program will be at 6:30 p.m. Wednesday at Greg Guenther’s farm, Belleville. Robert Bellm, University of Illinois Extension educator, and Phil Seaman, Abengoa Bioenergy grain merchandiser, will be the speakers. Dinner will be served. Call the Farm Bureau office at 939-6197 or 233-6800 for reservations or more information. EORIA — A grassroots picnic will be at 6 p.m. Thursday at Farm Bureau park. Call the Farm Bureau office at 686-7070 by Monday (today) for reservations or more information.
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• Farm Bureau will sponsor a bus trip Wednesday, Sept. 2, to the Farm Progress Show, Decatur. Cost is $25. Call the Farm Bureau office at 686-7070 for reservations or more information. • Deadline to submit pictures for the photo contest is Sept. 1. First, second, and third place cash awards will be given in three categories: farm related-scenes and activities; nature and wildlife; and barn scenes. There also will be a Best of Show cash award. ANGAMON — The Marketing Committee will sponsor its annual AgriVisor steak fry meeting at 6:30 p.m. Monday, Aug. 31, at the Tom Modonia Park. Dale Durchholz, AgriVisor
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LLC, will be the speaker. Cost is $10. Call the Farm Bureau office at 753-5200 for reservations or more information. • The Young Leader and Marketing Committees will sponsor their annual corn yield survey meeting at 7:30 a.m. Friday, Sept. 4, at the Farm Bureau office. Lunch will be served. Call the Farm Bureau office at 753-5200 for more information. T. CLAIR — The Mon-Clair Corn Growers test plot program will be at 6:30 p.m. Wednesday at Greg Guenther’s farm, Belleville. Robert Bellm, University of Illinois Extension educator, and Phil Seaman, Abengoa Bioenergy grain merchandiser, will be
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the speakers. Dinner will be served. Call the Farm Bureau office at 939-6197 or 233-6800 for reservations or more information. ERMILION — The Ag in the Classroom open house will be from 4 to 7 p.m. Wednesday, Sept. 2, and from 4 to 5 p.m. Thursday, Sept. 3, at the Farm Bureau auditorium. Staci Walker, ag literacy coordinator, will have ag learning kits and materials available for teachers. Call the Farm Bureau office at 217-4428713 for more information.
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“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 manager.
Wal-Mart feeds ag literacy efforts with IAITC donation BY KAY SHIPMAN FarmWeek
Helping Illinois children learn about food and agriculture makes sense for a company that sells $20 billion in goods, including food, and services in the state. That’s why the Walmart Foundation donated $50,000 to Illinois AgriculJohn Bisio ture in the Classroom (IAITC) last week, said an Illinois Wal-Mart executive. “A lot of folks take for granted what it takes to get food to the table,” John Bisio, director of public affairs and government relations for WalMart in Illinois, told FarmWeek. “This is particularly gratifying to be able to support IAITC ... and help non-traditional students understand agriculture in Illinois.” Bisio presented Illinois Farm Bureau President Philip Nelson with a check on Ag Day at the Illinois State Fair. The educational component of IAITC appealed to the Walmart Foundation, which received 100 applications for funding, Bisio explained. He said he also appreciates IAITC’s focus on teaching children about health and nutrition. As a result of Wal-Mart’s donation, IAITC will develop an after-school ag program to teach children in grades kindergarten through sixth that pizza ingredients come from farms. The nine-week program will be available to park districts, YMCAs, YWCAs, Boys & Girls Clubs, and other groups that offer after-school pro-
grams, according to Kevin Daugherty, IFB education director. Separate lessons on beef, pork, dairy, and specialty crops — all pizza ingredients — will be distributed through county Farm Bureaus and should be available in January, Daugherty said. In addition to education, WalMart also is focusing on helping farmers sell produce and farm
products through local Wal-Mart
FarmWeekNow.com Learn more about Illinois Ag in the Classroom by visiting FarmWeekNow.com.
stores, Bisio said. The company is working to identify potential growers and their products, Bisio added. He encouraged interested farmers
to contact local Wal-Mart store managers. “It’s not uncommon for a regional (Wal-Mart) buyer to put a national buyer in touch with a local grower,” Bisio explained. A grower could supply as many as 25 stores, depending on the product and the grower’s situation. For Wal-Mart, “locally grown is a big focus,” Bisio said.
IFB seeks Action Team members Illinois Farm Bureau is seeking members for involvement in Action Teams. Applications for Action Teams are available at county Farm Bureaus or by going online to {www.ilfb.org} and clicking on “Programs and Activities.” Applications are due by Dec. 4. Members who apply may select the Action Team that best meets their interests. The four
Action Teams are public relations, education, membership, and quality of life. Each team is comprised of 10 to 15 men and women with a variety of leadership experiences. Teams meet twice a year to turn their ideas into specific Farm Bureau projects. For additional information, contact your county Farm Bureau manager.
AGRI-QUIZ BOWL MATCH
The Livingston County Farm Bureau Young Leaders 1 and St. Clair County Farm Bureau Young Leaders 1 compete during the Agri-Quiz Bowl at the Illinois State Fair last week. Stephenson County Farm Bureau Young Leaders 1 took top honors followed by St. Clair Farm Bureau 1 in second, Vermilion County Farm Bureau Young Leaders 1 in third, and Livingston Farm Bureau 1 in fourth. Thirty-one teams competed in the event. (Photo by Ken Kashian)
FarmWeek Page 12 Monday, August 24, 2009
FarmWeek Page 13 Monday, August 24, 2009
GROWMARK
Strategic direction leads GROWMARK to Ontario, East Coast BY HEATHER MILLER
Compare the GROWMARK System of today with the cooperative formed more than 80 years ago, and there are two very different pictures. In 1927, GROWMARK operated in Illinois. In the 1960s, business expanded into Iowa and Wisconsin. Today, the regional cooperative conducts business in 23 states and the province of Ontario. The evolution to an international organization began in 1995 when GROWMARK moved into Ontario, Canada. Ontario operations include member cooperatives, similar to local FS companies in the U.S., FS Partners, a retail division directly controlled and owned by GROWMARK, and regional support services including warehousing, marketing programs, training, and more. GROWMARK also has partial ownership of UPI Energy, which serves Ontario member cooperative energy needs, and Great Lakes Grain, a partnership with AGRIS Cooperative Ltd, the largest member cooperative in Ontario. “GROWMARK has brought significant benefits to Ontario, including
David Coia, left, a Delaware farmer and a GROWMARK FS (GFS) customer, and GFS crop specialist Salvatore Pustizzi discuss the upcoming leek crop in a field in Delaware. GFS is a wholly owned subsidiary of GROWMARK. (Photo provided by GROWMARK)
China starts construction on 10-gigawatt wind farm China recently broke ground on a $17.6 billion wind farm in northern China capable of generating more than 10 gigawatts. It is the first of seven planned mega wind farms in China, each with more than 10-gigawatt capacity. The Gansu province wind farm project is mind boggling in its generation capacity. One gigawatt equals 1,000 megawatts. McLean County’s Twin Grove Wind Farm has 240 turbines with a total capacity of 396 megawatts. The Gansu wind farm is expected to generate 20 gigawatts by 2020, according to the Chinese government. China is committed to generating 3 percent of its total energy from nonhydro power renewable sources by 2020.
market clout, stability, and long-term profitability,” said Claude Gauthier, GROWMARK Ontario region manager. “In return, we in Ontario are adding sales volume to the system and we’ve also added a dimension, making GROWMARK a North-American organization.” In December 2002, GROWMARK acquired the assets of Agway’s agronomy business and created GROWMARK FS (GFS) LLC. The wholly owned subsidiary of GROWMARK provides wholesale and retail agronomy solutions and services in the eastern U.S. GFS operates 37 retail plants throughout New York, Pennsylvania, New Jersey, Delaware, Maryland, and parts of Virginia. “GROWMARK was interested in growing in the retail business, and the
Last of a series venture with GFS offered that opportunity outside of the core geography,” said Steve Buckalew, GROWMARK vice president of eastern retail operations. “This created major geographical expansion for GROWMARK, and it has been a great thing for farmers on the east coast.” The Agway acquisition also included a full-line seed company, Seedway LLC. Seedway is the largest seed company in
the Northeast/Mid-Atlantic U.S. and supplies farm, turf, and vegetable seed to farmers from the Rocky Mountains to the East Coast. It’s headquartered in Hall, N.Y. “When GROWMARK obtained the Seedway and GFS businesses in the east, it opened up the northeast and mid-Atlantic markets,” said Bruce Ulmer, Seedway director of marketing and employee education. “GROWMARK is a leader in the Midwest farm seed industry, but it wasn’t as familiar with vegetable seed. This acquisition gave GROWMARK exposure both in a different side of the seed industry and in a different region of the country.” Heather Miller is a GROWMARK corporate communications intern. Her e-mail address is hmiller@growmark.com.
FarmWeek Page 14 Monday, August 24, 2009
PROFITABILITY
Time to give grain system pre-harvest TLC BY RANDY HOLTHAUS
Unless you have ESP, It’s hard to predict what this fall has in store for you and your grain system. Don’t rely on luck when it comes to your grain equipment. A preseason service check will Randy Holthaus help identify potential equipment problems and enable you to correct them before your bins are full of wet grain. Preventing downtime with a preseason inspection will be money and
time well spent. The following items should be checked to prepare your grain system for harvest: The first priority is safety. Inspect and make sure every shield is in place and working properly to protect you, your family, your workers, and service providers. Take a walk around your entire facility and note every moving part and electrical connection. If you see anything that is not as it would be if it were brand new, fix it now so it doesn’t cause a catastrophe when you are caught up in the bustle of the busy season. Inspect empty bins for evi-
dence of leaks, corrosion, and pests. Wire brush or sand off red rust and recoat with soy zinc primer or cold galvanizing paint. Clean out old grain, fines, chaff, and dirt. Inspect bin floors for collapse, holes or soft spots where supports may have failed. Flashing should be secure and not leaking grain into the plenum. Check the plenum for fines buildup or leaked grain. Seal evident air and water leaks. Seal concrete cracks to keep out water and pests. Make sure your receiving and handling equipment is ready to run. Auger flights should have flat edges. Sharp
flighting causes excess grain damage, is dangerous to work around, is subject to failure at any time, and needs to be replaced. Tubes, housings, trunking, and spouting need to be inspected for wear spots, discoloration and dents. Bearings should run free and accept lubrication readily. Pulleys, belts, sprockets, and chains need proper alignment and tension and an inspection for damage or wear. Lube all joints and gear boxes to manufacturers’ specifications. Electrical equipment should be thoroughly inspect-
ed for exposed wires, loose connections, rodent damage, open junction boxes, and general integrity by a trained professional before being tested. Make sure safety circuits and components are in place and operating properly. These general inspection procedures apply to all gas-fired equipment and accessories. A little TLC now will pay big dividends in reduced down time and peace of mind during harvest. Randy Holthaus is GROWMARK’s grain systems marketing manager. His e-mail address is rholthaus@growmark.com.
Are farmers paying too much for federal crop insurance? BY DANIEL GRANT FarmWeek
Farmers who had issues with the federal crop insurance in recent years may see some adjustments to the program in the future. The Risk Management Agency (RMA) is in the process of reviewing crop insurance pricing methodology, William Murphy according to William Murphy, RMA administrator, who met this month with participants of the Illi-
nois Farm Bureau Marketers to Washington. “There are concerns that farmers in Iowa and Illinois are paying excessive rates and not getting enough out of the program,” Murphy said. Analysis of the crop insurance industry conducted by Iowa State University concluded corn and soybean farmers in Illinois, Iowa, and Indiana from 2000 to 2008 paid $768 million more in premiums than they collected in indemnities. Last year, the federal crop insurance program took in about $10 billion in premiums and issued about $8.8 billion in payments, according to Murphy.
M A R K Feeder E T pigFA CTS prices reported to USDA* Weight 10 lbs. 40 lbs. 50 lbs. Receipts
Range Per Head Weighted Ave. Price $6.00-$31.25 $20.88 n/a n/a n/a n/a This Week Last Week 19,902 12,316 *Eastern Corn Belt prices picked up at seller’s farm
Eastern Corn Belt direct hogs (plant delivered) Carcass Live
(Prices $ per hundredweight) This week Prev. week $44.31 $45.67 $32.79 $33.80
Change -1.36 -1.01
USDA five-state area slaughter cattle price (Thursday’s price) Steers Heifers
This week 82.23 82.17
Prv. week 82.42 82.00
Change -0.19 0.17
CME feeder cattle index — 600-800 Lbs. This is a composite price of feeder cattle transactions in 27 states. (Prices $ per hundredweight) This week Prev. week Change 100.66 100.48 0.18
Lamb prices Confirmed lamb and sheep sales This week 810 Last week 1,253 Last year 957 Wooled Slaughter Lambs: Choice and Prime 2-3: 90-110 lbs, $98; Choice and Prime 2-3 110-130 lbs., $93.50. Good and Choice 1-2: 60-90 lbs., $105. Slaughter Ewes: Utility and Good 1-3: $26-$29. Cull and Utility 1-2: $26.
Export inspections (Million bushels)
Week ending Soybeans Wheat 08-13-09 5.6 13.9 08-06-09 10.1 15.0 Last year 6.5 38.6 Season total 1202.4 145.3 Previous season total 1097.3 268.6 USDA projected total 1210 980 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.
Corn 40.9 35.9 45.0 1679.5 2262.0 1700
Mike Clemens of the National Corn Growers Association recently testified before the House Ag Subcommittee on General Commodities and Risk Management that if indemnity payments are considerably less than premiums paid then premiums perhaps should be lowered to reflect actual Mark Hines losses. But Mark Hines, a farmer from Downs in McLean County, said he expected higher crop insurance rates last year due to higher commodity prices at the time. Liability on all crops insured last year increased by about $20 billion and totaled nearly $90 billion (see graphic). “Insurance coverage per acre went up substantially (in the past year),” Hines said. “But you are protecting a lot higher-value crop, especially last year.” Hines believes a lot of farmers took lesser crop insurance coverage to deal with higher premiums. Meanwhile, some organic crop growers feel there is a disparity in coverage levels as they must use the same price election as growers of conventional crops even though organic production generally yields less but has a higher market value, according to Murphy. “We’re going to continue to look into that,” he said. Another emerging issue for RMA is providing coverage for energy crops that don’t have a proven production record in the U.S. Some farmers who grow alternative crops for energy production initially could struggle to get insurance
and/or secure operating loans. “That’s problematic for insurance,” Murphy said. “We need a (cropping) history to do rate projections.” RMA likely will apply criteria used for the pasture, rangeland, and forage product to
provide insurance for energy crops that don’t have an established production history, Murphy noted. For more information about crop insurance, Murphy suggested producers visit the website {www.rma.usda.gov.}.
Now ideal time to control brush Many farmers and landowners struggle to keep unwanted trees and shrubs from becoming established in fencerows, drainage-ditch banks, pastures, rights-of-way, and other areas. Brush can be controlled effectively by mechanical or chemical methods or by a combination of the two, said Bob Frazee, University of Illinois Extension natural resources educator. Frazee noted now is an ideal time for attacking brush problems. Mechanical brush control is time consuming and costly, but may be necessary in places where herbicide use is not desirable. Mechanical control may be accomplished by cutting, girdling, or grubbing a tree or shrub. Chemical brush control uses herbicides to control the plant or minimize resprouting. It is important to carefully and completely read and follow herbicide label directions, Frazee said. There may be restrictions on grazing or harvest periods or limits on applications to aquatic areas and drainage ditches. Brush herbicides may be applied as foliar treatment to leaves, as a basal-bark or cut-surface treatment on the stem or trunk, or applied to the soil. The method selected should depend on the herbicide applied, the site, the season, and the environment, he noted. Brush herbicides are categorized by their mode of activity. Some brush herbicides are selective; however, Frazee cautioned care is needed with even selective herbicides because they can injure desirable plants if the product is allowed to drift, run off, or leach out of the treated area. Nonselective herbicides will control all vegetation in the area. The most recent “Illinois Agricultural Pest Management Handbook” is available for $27 plus shipping by ordering directly from the U of I’ Publications Plus. The e-mail address is PublicationsPlus@uiuc.edu or orders may be placed at the toll-free number 800-345-6087. This publication contains the latest recommendations for all types of ag insect, disease, and weed problems, including brush control. For those who want to use the Internet, the handbook is available online at {www.ipm.uiuc.edu/pubs/iapmh}.
FarmWeek Page 15 Monday, August 24, 2009
PROFITABILITY Corn Strategy
C A S H S T R AT E G I S T Is meat decline near an end? Meat supplies this summer have overwhelmed demand especially the last three to four weeks. While demand may not have been as bad as it has been made out to be, it was soft enough to cause the emotional ingredient to get extremely negative. During the summer, cattle prices have drifted sideways in the low $80s. The hog market has seen the bulk of the pressure in recent weeks. While it’s not unusual for hog prices to decline relatively hard in the latter part of August, this year’s decline seemed especially hard. Given the mediocre summer peak, the break in August has seemed even more significant. The pork sector has struggled partly because the export market was not able to absorb supplies like it did a year ago. June’s pork exports were the smallest monthly volume since December 2007. The big change from last year was the steep decline in shipments to China. Last year, shipments were high as the Chinese were replacing their decline in production tied to disease and to pre-Olympic inventory accumulation. The biggest shift in what lies ahead over the next few months will be the seasonal decline in beef supplies, and it
Basis charts
should be a steeper decline than usual. Placements have declined more than 2 percent from last year so far. The Aug. 1 on-feed number could be the smallest this decade. Last year, weekly beef output dropped 13 percent from summer into fall. This year’s decline could be slightly larger yet. While beef output declines into winter, pork will increase. Given current hog inventories, they could rise 15 percent. The shift in supplies may keep red meat supplies close to summer levels into year’s end. But, if economic activity continues to improve, demand should become a little more robust, lifting the combined price structure from the levels that prevail today. Data from Canada indicated cattle and pork industries there are continuing to contract, especially the breeding herds. That and the contraction in the U.S. could result in smaller red meat supplies in 2010. While that won’t help the supply situation this fall, it could bolster demand to put meat into storage, helping boost demand and prices into winter. In summation, at this time, the red meat situation looks about as negative as it can be. Negative emotions are about as high as they can get, especially for hogs. Obviously, cattle prices should rise easier than hogs during the fall because of the seasonal decline in supply. But hog prices also might have fallen about as low as they are going. Steers are currently trading in the low $80s. By year’s end they could get back to the low $90s. The last time hog prices put in a major low, 2002, they rallied from $20 at the beginning of September to the low $30s by October. We wouldn’t be shocked to a similar occurrence, possibly moving from the low $30s to the high $30s, maybe even $40, by early October. As supplies increase, they could settle back into the mid-$30s for the seasonal low at the end of the year. AgriVisor endorses crop insurance by
AgriVisor LLC 1701 N. Towanda Avenue PO Box 2500 Bloomington IL 61702-2901 309-557-3147 AgriVisor LLC is not liable for any damages which anyone may sustain by reason of inaccuracy or inadequacy of information provided herein, any error of judgment involving any projections, recommendations, or advice or any other act of omission.
Policies issued by COUNTRY Mutual Insurance Company®, Bloomington, Illinois AgriVisor Hotline Number
309-557-2274
Cents per bu.
✓2008 crop: With shortterm price rallies increasingly remote, we’re inclined to hold inventories until after harvest, or use a marketing strategy that would keep pricing open until later this year on any inventories you may still have. ✓2009 crop: Upside potential is limited by the pull of the coming 20-week cycle low and approach of harvest. We expect December futures to bottom close to $3. Unless December futures unexpectedly rally into the $3.40s, hold off on catch-up sales until sometime after harvest unless you need to move bushels at harvest for space reasons. Even then, we would use a marketing strategy that keeps pricing options open. ❖Fundamentals: Increasing potential for a relatively large crop has been lifting the negative sentiment for corn prices. An unexpected early frost/freeze is about the only event that could reverse the negative price bias in the near term, and that won’t come into play until mid-September at the soonest.
Soybean Strategy ✓2008 crop: The old-crop premium started to rapidly disappear in some locations this past week. The fast change triggered ideas that ending stocks may be larger than presently forecast. If the oldcrop premium has mostly disappeared, we prefer to carry inventories until after harvest. ✓2009 crop: Use rallies to $9.90 on November futures for needed harvest or catch-up sales. Unless November futures drop below $8.80, we expect to see stronger markets again after the 8-9 week cycle bottoms in September. In this volatile environment, it may pay to check the Cash Strategist Hotline occasionally. ❖Fundamentals: The crop tour that crossed the Midwest last week found pod counts were lower except in western parts of the Corn Belt. Everyone agreed, though, this crop needs time to achieve yield potential. China continues to buy soybeans, lifting new-crop sales to 405 million bushels, double the five-year average. India’s monsoon season has been disappointing this year,
potentially increasing demand for products from the U.S. over the next few months.
Wheat Strategy ✓2009 crop: Wheat prices continue to slip lower, with futures approaching last December’s low. The market is in the window for the seasonal and 40-week cycles to bottom. We see limited downside risk at these prices. Hold off additional sales; better pricing opportunities should come this fall or winter. Prices have gotten so low that we don’t even see potential for a good short-term
catch-up sale opportunity. ❖Fundamentals: There’s no doubt U.S. and world supplies will be abundant this year. At this time, though, the action of buyers may be a more important price influence. In that light, Egypt’s larger purchase last week signaled that a key world buyer may see current prices representing good value. Longer term, there is potential for supply variables to tighten depending on weather’s impact on crops in Argentina, Australia, and India. All have some element of risk over the next few months.
FarmWeek Page 16 Monday, August 24, 2009
PERSPECTIVES
The week the H1N1 virus stole the farm Call it H1N1, please. The last week of April 2009 will be a week hog farmers will never forget. The week changed our lives and not in a positive way. The last week of April is when the H1N1 flu outbreak became news. Most media outlets tagged an inappropriate name to the flu virus. The unintended consequence of calling H1N1 the informal name “swine flu,” has been devastating to CHRIS all farms that raise CHINN hogs, including my family farm. Because of the unfortunate name choice, exports of U.S. pork have dropped, eliminating a key market rally that is typically seen each summer. This summer’s rally was especially crucial; hog farmers have lost money since September 2007. In fact, hog farmers have lost more than half of their accumulated equity since September 2007. Hog farmers desperately needed a summer rally to return profit to our farms. The other name for H1N1 stole this from us. Call it H1N1, please. There are many important facts
about H1N1 that help set the record straight — a matter especially important now that H1N1 is once again rearing its ugly head and the unfortunate moniker is creeping back into the news media. The H1N1 flu virus is not in pork. H1N1 influenza is not a foodborne illness. The safety of pork and pork products has been affirmed by the United Nations’ Food and Agriculture Organization, the World Organization for Animal Health, the World Health Organization, and the World Trade Organization. Agriculture Secretary Tom Vilsack has said that U.S. pork is safe to eat. His statement is supported by recent research conducted by the National Animal Disease Center and international researchers. Influenza is a respiratory disease, and the virus is not found in the blood or meat of healthy pigs or in pigs that have recovered from the illness. Of course, sick pigs are never allowed to enter the food supply.
Hog farmers have protocols established for caring for animals that develop illness. Ill pigs are not sent to market. Just like humans, pigs can get ill,
but like humans, they recover. Call it H1N1, please. My family consumes the same food as other Americans. I want to ensure my family has a safe food supply that is raised in the United States. The best way to help ensure the safety and security of our domestic food supply is to support the U.S. hog industry.
Buy and enjoy U.S. pork and encourage your lawmakers to support trade agreements to open export markets. U.S. pork is safe and nutritious, and hog farming contributes needed jobs in the United States. So, do your country and U.S. hog farmers a favor — call it H1N1, please. Remind the news outlets you rely on for timely and accurate information — it’s H1N1. Together, we will beat this bug, and with your support, U.S. hog farmers will survive until our markets turn around. Eat pork, and call it H1N1, please. Chris Chinn, a Missouri hog producer, is a member of the American Farm Bureau’s Partners in Agricultural Leadership program. Previously she served as chair of AFBF’s national Young Farmer & Rancher Committee.
Inquiring minds wonder if drunken bees slur their buzz Recently honey bees from my hives discovered some wax and honey that had been standing in the barn for a couple of months. As honey bees will do when given such an opportunity, they immediately began cleaning up the honey and carrying it back to the hive. However, some of the bees seemed to be having trouble flying — and walking. The bees were behavTOM ing as if they TURPIN were drunk, staggering around and bumping into things. As it turns out, they were drunk! Some of the honey had begun to ferment, resulting in the production of alcohol. The bees were drinking a version of honey wine, an alcoholic beverage known as mead. And the bees were behaving just like humans who have had a bit too much to drink. The fact that many animals, including insects such as bees and wasps, will consume substances containing alcohol and, as a result, get inebriated has long been known.
Some 2,300 years ago, the Greek philosopher Aristotle noted that pigs got a bit tipsy after consuming rotten and fermenting fruit. Past writers and amateur and professional filmmakers alike have recorded in word and picture the alcoholinduced antics of several kinds of animals. The animals became victims of demon alcohol when they ate ripe fruit that had fallen from amarula trees. Fermentation of the fruit in the animals’ stomachs resulted in alcohol production. The alcohol had the same effect on the animals as it does on humans — they got drunk and stumbled around. Insects, such as my honey bees, also behave in strange ways as a result of consuming alcohol. It has been reported in research studies that alcohol consumption resulted in bees flying less, walking less, and grooming less. But the bees spent more time upside down. As with humans, one of the first obvious symptoms of alcohol on the body is lack of coordination. So the ability of bees to stand on their six legs is diminished. Consequently, drunken bees spend more time falling down onto their backs than do their sober colleagues.
But drunken bees have more problems than loss of muscle control. They may not be able to return to the hive because they are unable to fly. In addition, bees walking are more likely to be injured in an accident or be consumed by predators. If by chance an inebriated bee does manage to return to the hive, it is likely to be rejected by the guards because it is acting strangely. Now biological researchers are attempting to understand the physiological basis for alcoholism in animals by studying the effect of alcohol on insects, such as the honey bee and the fruit fly. Insects and humans have similar nervous systems so an understanding of how alcohol affects the system in insects might be relevant to humans as well. As it turns out, the way alcohol affects the insect’s body is determined by gene expression. The fruit fly, the insect that has for centuries been the laboratory animal for genetic study, responds to alcohol in similar fashion to other animals. These flies get drunk and can’t walk, fly, or even cling to a surface. Recent research has shown that the expression of
almost 600 genes in the fruit fly was affected by exposure to alcohol. Because humans and fruit flies at the gene level respond to alcohol in the same way, an understanding of how alcohol works on the flies might give some insight into how alcohol works on humans. This would be especially important to an understanding of how genetic makeup contributes to alco-
holism in humans. The gene and behavioral similarities between insects and humans relative to the effects of alcohol raise a question in my mind about my drunken bees. Are those bees slurring their buzz? Tom Turpin, a professor of entomology, at Purdue University, West Lafayette, Ind. His e-mail address is turpin@purdue.edu.
“It would be appreciated if you not chew your cud so loudly.”