Farmweek august 19 2013

Award-winning weather contributed to a successful Illin o i s S t a t e Fa i r f o r f a i r g o e r s, exhibitors and animals.........3-5

IFB market tour member s learned corn exports could rebound from a 42-year low in the face of bin-busting yields...............7

Energy continues to ride the r a i l s, f u e l i n g e x p e c t a t i o n s o f increased freight movement for major rail carriers.........................8-9

A service of

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New ag deputy: USDA ready to implement farm bill Illinois Farm Bureau mission: Improve the economic well-being of agriculture and enrich the quality of farm family life.

Monday, August 19, 2013

BY DANIEL GRANT FarmWeek

Modernize and Innovative Delivery of Agricultural Systems (MIDAS) program at many of the 2,200 FSA offices around the country.

The new system provided updated software at FSA offices and is designed to allow farmers to sign up for programs and maintain their records from home more often, similar to online banking.

But the MIDAS system at times has been overloaded and some FSA employees have had trouble inputting data during peak business hours.

“The MIDAS program has been a huge undertaking and

it’s hit some snags,” Harden said. “But it will be worth it.

We’ve got to keep up with technology.”

Schmidt said many of the glitches that weren’t detected during testing of the MIDAS system have been or will be resolved.

“Incrementally we’re seeing improvement,” he said. “We have to modernize and become more efficient.”

FSA staff in recent years has declined by as much as 15 to 20 percent nationwide.

If a farm bill is passed, it

Krysta Harden, left, meets with Illinois Farm Bureau members, left to right, Jim Neuschwander (Ford-Iroquois counties), and Dennis Green (IFB District 13 director from Lawrence County). Harden, who was named USDA deputy secretary a day before the meeting last week, assured IFB members USDA is ready to implement a new farm bill if Congress passes it. (Photo by Daniel Grant)

Scientists seek ‘NitroGenes’ to grow more corn with less See Farm bill, page 2

BY KAY SHIPMAN FarmWeek

Periodicals: Time Valued

Krysta Harden, who last week was named USDA deputy secretary, believes there still is a chance Congress could pass a farm bill this year.

And, if that happens, Harden assured participants of the Illinois Farm Bureau Marketers to Washington tour that USDA is ready to implement the massive piece of legislation.

“I remain hopeful that we are going to have a bill (this year),” Harden said during a meeting with IFB members at USDA headquarters. “It could be in a larger budget package later this fall.”

Harden believes it is important to maintain the nutrition title as part of the farm bill so every member of Congress “will have a stake in the farm bill.”

A new farm bill with a comprehensive crop insurance program also is vital to provide a safety net for farmers, she said.

“We know the difference it makes having some certainty,” Harden said.

Harden and Mike Schmidt, Farm Service Agency (FSA) deputy administrator for farm programs, acknowledged there have been some issues with the implementation of the

Three sections Volume 41, No. 33

University of Illinois graduate fellow Jessica Bubert displays corn from high nitrogen, left, and low nitrogen NitroGene research plots during U of I Agronomy Day last week in Urbana. Looking on is Stephen Moose, U of I maize genomics professor. (Photo by Kay Shipman)

FarmWeek on the web: FarmWeekNow.com

University of Illinois genomic researchers have identified corn genes whose traits may be able to improve corn yields without increased nitrogen.

“We want to improve traits at the molecular level,” said Jessica Bubert, U of I crop science graduate fellow. Bubert and Stephen Moose, U of I maize genomics professor, described their research during Agronomy Day at the Crop Sciences Research and Education Center, Urbana.

The researchers studied corn lines from different eras. “Plant nitrogen has not changed much since the 1940s. We have For more from not bred for nitrogen uptake.

Agronomy Day, see We’re breeding for nitrogen efficiency,” Bubert said. page 11 Plant breeders have increased corn’s utilization of nitrogen as evidenced by plants that produce more grain from the same amount of nitrogen, she noted.

The corn plant’s biomass production also has increased with the same amount of nitrogen, giving farmers “more bang for their buck,” she added.

U of I researchers identified nine “NitroGenes” that are involved with nitrogen cycling within a corn plant. However, no single NitroGene had a positive effect greater than 2.5 bushels per acre yield.

The researchers searched for lines that had all or the most of those nine genes and also for lines that had none or few NitroGenes. They weren’t able to find a line that had all nine.

Last year, they planted and compared the lines with the most NitroGenes with lines that had few. Despite the drought, the lines with more NitroGenes had higher yields — as much as six bushels per acre higher in some cases — compared to the lines with fewer NitroGenes.

This marks the second year of growing lines with NitroGenes, and researchers will analyze the data.

And a super NitroGene line may be in the offing. “We didn’t have any lines with all nine genes so we’re doing breeding to have a super line,” Bubert said.

“This strategy should be translatable into industry,” she summarized.

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

Quick Takes

FarmWeek Page 2 Monday, August 19, 2013

PRAIRIE FARMS HONORED ON AG DAY — The State of Illinois marked Prairie Farms Dairy Day on Agriculture Day at the Illinois State Fair. Gov. Pat Quinn issued a proclamation recognizing the 75th anniversary of the Carlinville-based cooperative. The proclamation notes the cooperative’s economic contributions to the dairy industry in the Midwest and the Mid-south.

Quinn also noted he had sampled Prairie Farms products while at the fair.

CONSERVATIONIST OF YEAR NAMED — Kelly German of Iroquois County has been named District Conservationist of the Year by the Illinois Department of Agriculture and Illinois Stewardship Alliance.

German has served as Iroquois County district conservationist since March 2012. She was selected for the award for enrolling 20 new farmers and landowners with more than 9,100 acres into the Conservation Stewardship Program this year.

German previously served the U.S. Natural Resource Conservation Service in Kankakee, Vermilion and Macon counties.

CROP ADVISER AWARD NOMINEES SOUGHT — The Illinois Farm Bureau and the Illinois Certified Crop Adviser (CCA) Board are accepting nominations for the Illinois Certified Crop Adviser Award. The deadline for nominations is Oct. 4.

The award recognizes an individual who has performed superior service for his or her farmer clients in nutrient management, soil and water management, integrated pest management and crop production.

The award will be presented in December at the IFB Annual Meeting in Chicago. The winner will be recognized at the Illinois CCA Conference in Springfield. The state winner will be submitted to the Illinois CCA Board to be considered for the International CCA Award.

Eligible nominees must be certified crop advisers in Illinois and be nominated by a county Farm Bureau, an active Farm Bureau member or the employer of the CCA who has knowledge of the CCA’s qualifications. Other agricultural groups may suggest nominees.

County Farm Bureaus have received information and nomination for ms. Direct any questions to Lauren Lurkins, IFB director of environmental and natural resources, at 309-557-3153, llurkins@ilfb.org.

COST OF RAISING KIDS SOARS — Families who welcomed a new child in 2012 may need some deep pockets. According to a USDA report, middle-income parents will spend about $241,080 to raise a child to age 17.

Total costs increased 2.6 percent from 2011. The largest expense increases occurred for child care, education, health care and clothing. Smaller increases were reported for housing, food, transportation and miscellaneous expenses.

In 1960, the first year the report was issued, a middleincome family spent $25,230 to raise a child to age 17.

(ISSN0197-6680) Vol. 41 No. 33

August 19, 2013

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THE FARM BILL

Davis seeks ag conference seat, sees potential for SNAP accord

BY MARTIN ROSS FarmWeek

Amid the sound of show animals and the mingled scent of corndogs and funnel cakes, U.S. Rep. Rodney Davis urged farmer/fairgoers not to give up hope on a fall farm bill.

During the Illinois State Fair last Thursday, Davis, a Taylorville Republican and House Ag Committee member, reported plans in September to move a food and nutrition bill as a companion to the House’s recentlypassed farm bill package.

The Senate’s comprehensive farm bill proposes $4 billion in U.S. Rep. Rodney nutrition cuts over the next 10 Davis years, targeting primarily the Supplemental Nutrition Assistance Program (SNAP, or food stamps). House members in July gridlocked over a proposal to cut $20 billion from SNAP and subsequently removed nutrition provisions from its farm bill.

Davis’ hope is for Senate farm bill conferees to consider the separate House nutrition measure along with proposals “on the ag side.” He told FarmWeek the new nutrition bill would propose closer to $40 billion in 10-year cuts, with SNAP administration reductions achievable through “common sense reforms” that shouldn’t hurt needed benefits.

Beyond nutrition and some farm target price issues, “we’re not that much different from the Senate,” said Davis, who noted both bills would save $20 billion in long-term commodity spending.

Splitting off nutrition programs won back support

from 50 of 62 Republicans who voted against a previous, comprehensive House proposal, he said.

The congressman sees a willingness among Republicans to negotiate a SNAP spending compromise. However, he notes House proposals would save $8 billion alone by tightening provisions that currently allow states to grant food stamp benefits to households that receive $1 in heating assistance.

“I think it’s up to the Democrats to decide whether or not they want to actually work with us and approve these common sense reforms,” Davis said. “I don’t think they want to even touch the food and nutrition side now. Out-of-control spending and no reforms remains as the status quo if they do nothing, because (SNAP’s) a mandatory spending program.

“I think the food and nutrition bill will pass on a partisan roll call (vote). The key will be getting it out of the House and getting it to the conference committee.”

A successful conference is crucial. Davis sees “no appetite” for a 2008 farm bill re-extension otherwise necessary for most ag program continuation past Sept. 30. He reiterated the need for a bill that strengthens federally supported crop insurance resources to assure long-term certainty in the ag sector (see story below), citing growing urban and suburban influence in ag policy development.

Davis hopes for a spot on the farm bill conference committee. He worked with House Majority Leader Eric Cantor, R-Va., to help formulate original farm bill nutrition provisions, and was one of four Republican “whips” who helped shepherd party support for farm bill passage.

Farm leaders: Crop insurance vital for risk management

BY DANIEL GRANT FarmWeek

Farm leaders in favor of a strong crop insurance program believe legislators need to review the events of 2012 to fully appreciate the value of the program.

Most farmers stayed in business, and some even flourished last year, despite experiencing the worst drought in a quarter century in much of the Midwest and other parts of the country.

“Last year could have been a disaster,” Michael Alston, deputy administrator for insurance services at the Risk Management Agency (RMA), told participants of the Illinois Farm Bureau Marketers to Washington tour.

Farmers in the U.S. last year received a record $17.4 billion, including $3.4 billion in Illinois, from crop insurance to cover massive crop losses, Alston noted.

“Last year I had the worst corn crop I’ve ever had,” said Dennis Green, IFB District 13 director from Lawrenceville, whose crop averaged 26 bushels per acre in 2012. “In the 1980s, farmers would have hoped to receive disaster payments to make up for the loss.”

Last year, however, many farmers who signed up and paid premiums for crop insurance received payouts that covered their losses.

The RMA insures about 80 percent of crops

Farm bill

Continued from page 1 will be implemented by USDA in stages. There is money in the budget for USDA to hire technology support and temporary employees to assist in

in Illinois, according to Alston.

However, the large payouts last year attracted the attention of some legislators looking to cut spending in a possible rewrite of the farm bill.

Farm leaders last week stressed to IFB members the need to push for the continuation of a strong crop insurance program in the farm bill.

“It (the crop insurance program) is a huge budget target,” said Sam Willett, senior director of public policy at the National Corn Growers Association (NCGA). “We have a lot of work to do to educate legislators and neighbors why this is important. Crop insurance was a very successful risk management program last year.”

The program, however, has some imperfections. NCGA favors a study to establish premiums that better reflect risk over time.

RMA this year also did not extend its acreage reporting deadline beyond July 15, despite the fact the Farm Service Agency (FSA) extended its deadline due to the lateness of planting.

“July 15 is a contractual date (RMA has) with 18 private companies (that sell crop insurance),” Alston said. “All 18 companies had to agree to move that date.”

Since the crop reporting dates for RMA and FSA were different this season, it’s up to farmers and crop insurance agents to make sure their acreage data matches up with both agencies.

the process, Schmidt noted.

“If we get a (farm) bill, I can assure you we are ready to implement it,” Harden said.

“We were ready last year.”

IFB was the first farm

group Harden met with in her new role as deputy secretary.

Harden, who was raised on a peanut farm in Georgia, previously served as USDA chief of staff.

STATE FAIR

Page 3 Monday, August 19, 2013 FarmWeek

Farmer-woodcarver puts personal touch on new trophy

BY KAY SHIPMAN FarmWeek

The new pig de resistance of the junior barrow competition adds a personal touch to Illinois State Fair memories.

“It’s been so good to our family that we wanted to give the kids something to shoot for. We thought it would be cool to have a traveling trophy,” Peoria County farmer Jared Schlipf said of the new trophy he and his brother, Ryan of Woodford, donated.

The Schlipfs not only donated the trophy, but Jared also carved a crossbred barrow from tupelo wood to adorn the trophy claimed for the first time by Tyler Gradert of Geneseo.

The Schlipf cousins work together to prepare their hogs for the state fair with the older cousins helping the younger ones. “We know only one can win the state. We win together and we lose together ... It’s a neat experience,” Jared said.

That closeness extends to the other farm families who compete in the showring.

“The family who won the trophy, we’ve competed against them.They’re a great family; they’re extremely competitive.

We all are,” Jared said.

The families of swine exhibitors no doubt will add their own stories as well as their names to a new piece of fair history.

Junior hog, exhibitor numbers mark increase at 2013 Illinois State Fair Illinois State Fair visitors were correct if they thought they saw more junior swine exhibitors and hogs on the Springfield fairgrounds.

Entries for the state fair junior swine show were up substantially, according to Dale Edwards, who along with his wife, Janet, are long-time superintendents of the junior swine show.

More than 1,100 barrows and 856 gilts were entered in the junior show by the July 1 deadline, said Edwards, a Buffalo farmer. By the August fair, the two categories combined increased by about 100 head compared to last year, Edwards estimated.

Several factors may be contributing to the influx of youngsters showing swine.

“The temperatures have been beautiful. That’s been a lot easier,” Edwards noted. He speculated cooler temperatures that put less stress on the animals may have contributed to the increase.

Another factor may be a state fair rule change that occurred several years ago, according to a state fair swine exhibitor.

Peoria County farmer Jared Schlipf whose children exhibit hogs attributed some of the increase to the “dropping of the mandatory kill” requirement. Exhibitors would be more likely to bring lighter weight barrows if they could continue to feed the animals and show them elsewhere after the state fair, Schlipf explained.

“It was a great thing when they did it (change the rule),” he concluded. — Kay Shipman

AG DAY BILL SIGNING

Peoria County livestock farmer Jared Schlipf, Brimfield, carved the crossbred barrow adorning a new traveling trophy he and his brother, Ryan, donated for the junior grand champion barrow exhibitor at the Illinois State Fair. The Schlipf families hope the award makes the competition more special for young exhibitors.

(Photo by Ken Kashian)

Attorney general works to prevent consumer fraud

The attorney general’s staff works with local Scam artists claiming to provide legitimate repairs are as inevitable as the property damage officials so legitimate contractors are issued crecaused by tornadoes, floods and other disasters. dentials, she noted.

Information and fraud report However, the Illinois attorney FarmWeekNow.com forms may be found online at general is taking a proactive Visit FarmWeekNow.com to {illinoisattorneygeneral.gov/conapproach to help local officials learn more about Illinois At- sumers/}. and protect property owners coptor ney General Lisa MadiIn other news, the attorney ing with natural disasters. gan’s anti-fraud efforts. general said the process continIllinois Attorney General Lisa ues on a legal challenge of the Madigan highlighted consumer state’s new concealed carry weapon law. A protection last week during woman who brought the original lawsuit and Agriculture Day at the Illinois the Illinois State Rifle Association who sought State Fair. “One thing we’re immediate rights to legally carry concealed guns aware of with the uncertainty are appealing a U.S. District Court ruling. Madiof the farm bill, farm families gan represents the state in the matter and said are under economic pressure,” the next court action is scheduled for October.

Madigan told FarmWeek.

She referred anyone with questions about the Over the last 10 years, new concealed carry law to the Illinois State Madigan’s staff has received Police website {isp.state.il.us} and the concealed Lisa Madigan more than 250,000 consumer carry icon on the right side of the page. A fraud complaints. “We really detailed list of questions and answers is provided. encourage people to call us” with questions, As for legal action on the governor’s veto of Madigan said.

Her staff has taken a proactive approach to state legislators’ salaries, the next court date is scheduled for Sept. 18. “We’re representing the thwarting “storm chasers,” con artists who comptroller,” Madigan noted. swoop in after storms to take advantage of In mid-July, Gov. Pat Quinn used a line item property owners scrambling to make repairs. veto to cut the legislators’ salaries and stipends “We help communities set up a permitting from the state budget. — Kay Shipman process” of contractors, Madigan explained.

IAITC receives AT&T donation on Ag Day

Illinois Farm Bureau President Philip Nelson addresses the media and others gathered to see Gov. Pat Quinn, center left, sign several bills related to agriculture at the Illinois State Fair on Agriculture Day. One of the bills will promote new research and markets for wheat. (Photo by Kay Shipman)

AT&T presented the Illinois Agriculture in the Classroom (IAITC) with $25,000 for agriculture literacy efforts during Agriculture Day festivities at the Illinois State Fair, Springfield. The money will be used to distribute Illinois agriculture calendars to more than 25,000 classrooms.

“At AT&T, we invest in education to ensure the next generation of leaders and workers is prepared to meet the challenges of the global internetbased economy,” said Paul La Schiazza, president of AT&T Illinois. “This program

‘ We a p p r e c i a t e the commitment AT & T s h ow s t o the entire state of Illinois.’

— Susan Moore IAA Foundation director

(IAITC) helps the next generation more fully appreciate the benefits of agriculture to the

people and the economy of Illinois.”

“We appreciate the commitment AT&T shows to the entire state of Illinois,” said Susan Moore, IAA Foundation director. “We are thankful to have a continuing partner like AT&T who sees how making that connection from farm to fork is so vital today.”

IAITC is the top-funding priority of the IAA Foundation, Illinois Farm Bureau’s charitable foundation. Last year on Ag Day, AT&T donated $20,000 to IAITC for its school calendars.

STATE FAIR

FarmWeek Page 4 Monday, August 19, 2013

Fun key to Agri-Quiz Bowl strategies

BY KAY SHIPMAN FarmWeek

Forget the all-night study sessions and buzzer speed drills. Fun remained No. 1 for county Farm Bureau Young Leaders competing in last week’s Agri-Quiz Bowl at the Illinois State Fair. “We’re here for a fun day,� said Darin Doehring, a member of Shelby County’s team.

Asked if his team used any other strategies, Doehring added, “don’t lose.�

Some competitors might have tried to pysch out their opponents. One young leader posted on his Facebook page a photo of notebooks from college ag classes and his

goal to review everything.

Madison County team members added practicality to their strategy. “Sometimes it’s a process of elimination,� said Madison County’s Trevor Henkhaus of multiple-choice questions. “It’s an educational guess,� said his teammate, Louis Kreutzberg. “Sometimes you know it and sometimes you don’t.�

Fast reflexes don’t hurt, according to Knox County’s Laura Nelson. Her team’s strategy included: “buzz in if you know it.�

Knox County’s all-woman team also had “girl power,� added Monica Stevens.

Shelby County fielded a team of generalists this year, although the team has used specialists previously. “We had an ag teacher on one team.

She answered a couple of questions. And we’ve had vets (on past teams),� offered Shelby County’s Darin Doehring.

Sometimes playing a hunch is the best strategy. “The last one was a best guess, and we got it,� Doehring added.

The Kane County Young Leaders won top honors followed by Adams County in second place, Edwards County No. 1 team in third and Champaign County in fourth.

Kane County Young Leaders pool their talents to win the annual Illinois Farm Bureau Agri-Quiz Bowl at the Illinois State Fair last week. Team members from left are Heather Pierson, Trent Pierson, Andy Lenkaitis and Wayne Gehrke. (Photo by Jennifer Smith)

AG DAY AWARD

Illinois Farm Bureau President Philip Nelson, right, accepts an Illinois Leadership Council for Agriculture Education Excellence Award in agribusiness during Agriculture Day at the Illinois State Fair, Springfield. Presenting the award are Illinois Agriculture Director Bob Flider and Miss Illinois County Fair Amelia Martens.

(Photo by Kay Shipman)

YL award winners recognized

Ed and Kali Livengood of Milledgeville nabbed the Illinois Farm Bureau Young Leader Achievement Award at last week’s Illinois State Fair. They raise corn, rye and cattle.

Livengood is former Carroll County Young Leader chairman. He and his wife earned $2,500 and other prizes.

Daniel Robbe of Elizabeth received the Young Leader Excellence in Ag Award. The Jo Daviess County resident works on the Don Kautz cow-calf operation.

Robbe serves on the Jo Daviess County Farm Bureau Board and has been active in Young Leaders since 2009. He also earned $2,500 and prizes.

Matt and Cassie Lynch of West Salem in Edwards County were named runners-up of the Daniel Robbe Young Leader Achievement Award, winning $1,500. The Lynchs grow corn, soybeans and wheat.

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Ed and Kali Livengood of Milledgeville celebrate winning the Illinois Farm Bureau Young Leader Achievement Award at last week’s Illinois State Fair. The Carroll County farmers earned $2,500 and other prizes.

(Photo by Cyndi Cook)

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Adrian Austin of Marion County reassures her charge in the Illinois State Fair showring. Austin placed second in the 2013 Master Showmanship Contest. (Photo by Cyndi Cook)

STATE FAIR

Page 5 Monday, August 19, 2013 FarmWeek

Junior exhibitors net record prices at state fair sale Champion junior livestock brought winning prices at the governor’s sale of champions on Agriculture Day at the Illinois State Fair, Springfield.

Seven sale records were broken and an eighth was tied as Gov.

Pat Quinn and Illinois Agriculture Director Bob Flider encouraged bidders to spend a total of $222,650.

The exhibitors who raised the animals receive 80 percent of the sale price with state 4-H and

FFA dividing the remaining 20 percent.

Grand champion junior exhibitors, their species, prices and buyers included: Nelson England, Oneida, grand champion steer, $62,000, AT&T,

BY CHRIS ANDERSON FarmWeek

see the number soar to 100 million.

“Some devices now have a

message to the caller that you’re driving and that you will reply once you stop,” said La Schiazza. “If one life is saved, the effort will be worth it. Our work will never be done.”

Initial results of the Illinois 4-H It Can Wait campaign will be announced Sept.

19 on national Drive 4 Pledges Day. To learn more about the campaign, visit {itcanwait.com}.

Illinois 4-H’ers pledge to text-free driving Illinois 4-H members pledge to think clearly, be loyal, serve their communities and practice healthy living every time their clubs meet. Last week at the Illinois State Fair, they added safe driving to the list of promises.

The Illinois 4-H Foundation and AT&T announced their partnership in the It Can Wait campaign aimed at encouraging drivers to pledge never to text and drive. Drivers can take the pledge by texting “4H4ICW” to “50555”.

“My actions impact others, especially when texting and driving,” noted Ann Clary, 19, of Bloomington. “I took the pledge. Texting can wait, and it will wait for Illinois 4-H’ers.”

Clary, recently crowned McLean County Fair Queen, said It Can Wait complements other programs aimed at limiting distracted driving. As a member of the Illinois 4-H Youth Leadership Team, she plans to spread the word to every 4-H’er in the state.

“We’re excited to spread the message through the state with our 23,000 club members in 1,250 4-H clubs,” said Angie Barnard, Illinois 4-H Foundation executive director. “By encouraging people to take the pledge, we can help make our state safer and save lives.”

According to the National Safety Council, more than 100,000 crashes annually involve texting drivers. An AT&T teen driver survey found 97 percent said texting while driving is dangerous, yet 43 percent admitted to doing it.

“We are leading with innovation in mobile devices.

We want to lead in using them responsibly,” said Paul La Schiazza, AT&T Illinois president. “We chose to team with Illinois 4-H’ers because we know the influence they have with their families and friends in cities and rural areas.”

For AT&T, the effort represents a continuation of a national program joined by more than 200 organizations.

Supporters include Verizon, Sprint and T-Mobile U.S. Inc. La Schiazza noted that 2 million people have taken the pledge thus far. He’d like to

FarmWeekNow.com

For more information about the “It Can Wait” campaign, visit FarmWeekNow.com.

drive mode. In that mode, the device will not alert you to incoming messages. It sends a

Monsanto-DeKalb-Asgrow and Friends of Knox County 4-H; Abby Tomhave, Jacksonville, Land of Lincoln grand champion steer, $50,100, Friends of Morgan County 4-H, DuPont, Pioneer and Cargill; Tyler Gradert, Geneseo, grand champion barrow, $25,000, Terry Duffy of CME Group; Lane Rinderer, Elkhart, Land of Lincoln grand champion barrow, $40,650, Brandt Consolidated; Dylan Hummel, Cabery, grand champion meat goat, $11,050, Tom and Sarah Paulk, Rollie Rosenboom, friends, Oxygen Corp. and Oklahoma Show Goats; Carlee Critchelow, Chandlerville, Land of Lincoln grand champion meat

goat, $3,750, Land of Lincoln Meat Goat Breeders, Pro Harvest Seed, friends and Ed Teefey of Farmers State Bank & Trust of Mount Sterling; Bailey Hunt, Sycamore, grand champion poultry meat pen, $4,000, McDonald’s and Marty and Donna Davis; Serena Schafer, Brighton, grand champion rabbit meat pen trio, $4,000, Agrivest, Battery Specialists and the Sky Glide; Hanna Runner, Sciota, Land of Lincoln grand champion wether, $19,100, North American Midway Entertainment and friends; and Trent Kilgus, Fairbury, Land of Lincoln supreme champion female print, $3,000, Prairie Farms Dairy.

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FarmWeek Page 6 Monday, August 19, 2013

CROPWATCHERS Bernie Walsh, Durand, Winnebago County: The corn market has turned around and is starting to go up, which is good. We didn’t have any rain this past week, and there isn’t much in the forecast. The corn and beans still look good, and I think that is because we have not had any extreme heat to go along with the shortage of rainfall. Time will tell if this mini-dry spell will affect the final yield. It has been a very comfortable week for the Winnebago County fair.

Leroy Getz, Savanna, Carroll County: A dry week with record low temperatures of 45 degrees. Some bean fields are showing the need for rain. Corn is now in the dent stage and could also benefit from some additional moisture. The cooler weather has kept the insect population low.

This cutting of hay is a little short on yield. As schools start this coming week, watch out for those busses on the road.

We congratulate Ed and Kali Livingood on their Young Leaders Excellence Award achievement.

Ryan Frieders, Waterman, DeKalb County: It has been another dry week on the farm during the crucial pod and grain filling period. Pollination has finally occurred in our replanted corn. The Japanese beetles are very active in soybean fields and a second pesticide application was made.

Soybean pods and corn kernels are being aborted in order to conserve moisture and nutrients as the plants work through the stress. Hot temperatures are predicted for next week.

Larry Hummel, Dixon, Lee County: It has been 10 days since the last rain came through the area and the forecast for the next 10 days is dry as a bone.

Thursday’s high was in the low 80s, but it is dry enough that the leaves in the soybeans are going into a defensive mode. Spider mites are starting to show up around the field borders, along with the low, but growing population of aphids.

Ken Reinhardt, Seaton, Mercer County: Seaton caught a nice 0.3 of an inch of rain Friday evening (Aug. 9). Otherwise it’s dry. Some locations have had no rain in August and it doesn’t look promising for any meaningful amounts. The local weatherman puts the chance of an early frost at 60 percent. That would be about a month too soon for my replant corn.

Ron Moore, Roseville, Warren County: We did not receive any rain last week. The lack of rain is becoming concerning for both crops and a water source for the cattle on pasture. We have been checking fences every day and repairing them because the cattle really like the corn instead of dry grass. The first field of corn we planted is now starting to dent. The beans are filling pods. It is critical we get some rain or we will start trimming back expected yields for this fall.

Jacob Streitmatter, Princeville, Peoria County: Cooler weather has really slowed the corn and soybean crop. The corn is filling, but it is only at roasting ear stage. At this pace, any frost earlier than normal will definitely hurt yield. There has not been much rain to speak of. Any rain is welcome now.

Brian Schaumburg, Chenoa, McLean County: Our annual Heartland Bank crop yield tour shows good yield prospects and consistent near 200 bushels per acre checks over the entire survey area. The crop is healthy as disease and insect pressure is light.

Most corn is in the dough stage, but there are a few places that are in early dent. Kernel depth could be a limiting factor, but cool temps over the past three weeks have benefited corn in the face of little rainfall. Soybeans are all over the board on yield guesstimates. A late harvest is a given.

Corn, $6.02, fall, $4.53; soybeans, $14.04, fall, $12.34; wheat, $6.02.

Ron Haase, Gilman, Iroquois County: Our last rain was on Aug. 2. The cooler temperatures have slowed crop development, but have also helped relieve the stress from the dry soils. Some weeds are popping up above the soybean canopy. I hope it is not Palmer amaranth. We don’t want that problem.

Most of the corn in our area is at R4 or dough stage. Soybean development ranges from beginning pod stage up to beginning seed stage. After the USDA report, prices are now higher than last week. The local closing bids for Aug. 15 were nearby corn, $6.11; new-crop corn, $4.51; nearby soybeans, $14.12; new-crop soybeans, $12.48. Mowed roadsides, attended Agronomy Day at the University of Illinois and prepared for some Brazilian tour group visits.

Steve Ayers, Champaign, Champaign County: A week of San Diego weather continued, and we are still looking for rain. In our eastern crop reporting district corn is 98 percent silked, 53 percent dough and 10 percent dent.

Soybeans are 96 percent blooming with 81 percent setting pods. Our topsoil moisture is 5 percent very short, 35 percent short, 58 percent adequate and 2 percent surplus. Farmers are busy at the State Fair, mowing roadsides, walking beans, cutting hay, scouting fields and preparing equipment for harvest. See you at the Half Century of Progress VI in Rantoul August 22-25.

Wilfred Dittmer, Quincy, Adams County: We received a few drops of rain last week. This week, zero. Guess the crops are just going to have to survive from some deeper subsoil moisture. At least it has not been so hot so that kernel fill and pod fill can continue.

The Japanese beetles have all but left, so I don’t think they ate all the corn silks. The deer still have plenty to play in.

Carrie Winkelmann, Tallula, Menard County: The unseasonably cool weather has been nice for this pregnant lady, agronomy/plot days and the State Fair, but corn is not maturing as quickly as normal. Planes were still flying yesterday spraying fungicide on beans, but that seems to be slowing down. We have been getting machinery ready for harvest and doing a lot of mowing. A lot of haying was done in the area this week.

Todd Easton, Charleston, Coles County: Unusually cool weather still seems to be this year’s pattern, keeping development slow for all crops and probably making harvest later and later.

Moisture is still falling across the area along with the cool temps putting another inch in the gauge last week. Next weekend and week forecasts show us warming up into the 80s and will hopefully push the corn along a bit faster. Right now, most cornfields are in the R4 stage with black layer being estimated to occur in the last half of September if temperatures stay at least in the 80s on beyond next week. Soybeans are still developing slowly but surely and may be later than the corn again this year. Several combines have come out of the sheds to be inspected and maintained. They should be really, really ready by the time we get to harvest this crop.

David Schaal, St. Peter, Fayette County: It has been unseasonably cool for this time of the year. Temperatures not even getting in the 80s during the day and nights down to the low 50s. Air conditioners are getting a break, but it is probably not good for the crops. Crops are still looking pretty good, but now the cool weather is delaying the maturity progress.

Jeff Guilander, Jerseyville, Jersey County: Everything is still awfully green for being the middle/end of August. Some yield checks showed corn had a tougher year than we realized. Depending on the hybrid, we found tip back, low kernel counts (14 round/25-35 long) and significant pollination issues. Severity varied, but it is widespread enough to be the rule rather than the exception. I hope I can be more optimistic next week.

Jimmy Ayers, New City, Sangamon County: We received 0.5 of an inch of rain last week.

Corn wise, I think there has been some fungicide still being sprayed on the later-planted corn. Soybeans had some growth spurts with the water we received. The cooler temperatures are not helping anything, but the fields seem to be working through that. Mowing and thinking about equipment, with some getting them out and ready for the fall. Try to think through your plans now and get rid of the bottlenecks in your fall harvest operation.

Dave Hankammer, Millstadt, St. Clair County: It’s hard to believe that we are only mid-way through the month of August and yet it feels more like early fall.

Temperatures dropped to a nighttime low of 60 degrees this past week with daytime highs in the 70s.

At the farm, we had a trace of rain for the week. The crops continue to look good despite the lack of rain. The lateplanted soybeans have canopied over the wheat stubble in double-cropped fields and setting blossoms. We have reached that summer lull where crop scouting and monitoring has taken the forefront. Local grain bids are, corn, $4.74; soybeans, $13.45; wheat, $6.27.

Have a good week.

Rick Corners, Centralia, Jefferson County: Across the river in Missouri, they had over a foot of rain and we finally got 0.5 of an inch on Monday (Aug. 12). Areas to the north had 1 inch or more, and south had almost 1.5 inches. Stuff looks really good, but I think the race is on to make it to maturity this fall.

Kevin Raber, Browns, Wabash County: Cool day and nighttime temperatures seem to slow crop development. The double-crop beans seem to be especially slowgrowing right now. The Wabash County Farm Bureau corn yield estimate is scheduled for Monday (Aug. 19), so my next report should have our local yield estimates. Firstcrop soybeans look good, but will need rain soon to reach their full yield potential.

Dean Shields, Murphysboro, Jackson County: Since my last report, we had another 3 inches of rain (Aug. 9-10). So we have plenty of moisture here in Jackson County. The big question now is the cool weather. We worry about how soon the corn is going to mature and how good it is going to be.

Everything seems to growing well, including the weeds. Milo and wheat field beans are doing well also. Everyone is concerned about how good their crop is and what the price will be this fall.

Ken Taake, Ullin, Pulaski County: It has been great weather for the Pulaski County Fair. As I called in my report Friday morning, temperatures were in the low 50s. It feels like fall. I think this is slowing down crop maturity quite a bit, but crops continue to look good from the road. We just have to remember all of the holes and thin spots out in the fields. After last year, I think everyone is looking forward to having a good harvest.

Please have a safe week.

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

DATEBOOK

August 23-Sept. 2 DuQuoin State Fair August 27-29 Farm Progress Show, Decatur September 2-4 IAA Foundation Illinois Agriculture in the Classroom Bike Ride. Call Susan Moore at 309-557-2230 or go to {iaafoundation.org} for more information.

MARKETS

Page 7 Monday, August 19, 2013 FarmWeek

Crops have long way to go to meet production expectations

BY DANIEL GRANT FarmWeek

USDA’s August crop production re por t confir med what many analysts suspected.

A b in -b uster h a r vest is expected this fall for U.S. corn and soybean growers.

USDA’s first in-season estim a t e s o f t h e 2 0 1 3 c r o p s, which were compiled via farmer surveys and by field samples collected by USDA enumerators, predicted U.S. far mers this year will reap average yields of 154.4 bushels per acre for corn and 42.6 bushels per acre for soybeans.

If realized, U.S. corn production would total a recordhigh 13.76 billion bushels.

Soybean production would total 3.26 billion bushels, which would be the thirdlargest on record.

“Based on conditions as of August 1, USDA published some pretty good yields,” said Mark Schleusener, Illinois state statistician with the National Agricultural Statistics Service (NASS).

USDA projected crop yields in Illinois would average 165 bushels per acre for corn, up 60 bushels from last year, and 47 bushels per acre for soybeans, up 4 bushels from a year ago.

The average wheat yield in Illinois was raised 2 bushels from the July estimate to 67 bushels per acre.

“If realized, (the average wheat yield in Illinois) would tie the record set in 2006,” Schleusener said. “Beginning September 1, NASS will contact a larger sampling of (wheat) producers to finalize the yield for (this year’s) crop.”

Crop prices were steady and rallied at times last week as many traders expected larger crop estimates.

“It doesn’t look like there were any real surprises,” Joe Prusacki, director of the NASS Statistics Division, told participants of the Illinois Far m Bureau Marketers to Washington trip who participated in the USDA lock up and release of the report. “It was close to

trade expectations.”

Crop prices likely will be touch-and-go, though.

“T he crops look g ood,” Schleusener said. “However, t h e y ’r e l a t e r t h a n n o r m a l .

Many producers around the state are saying we need more rain to finish the crops.”

NASS last week estimated 78 percent of the U.S. corn crop was silking compared to the average of 90 percent. In Illinois, 50 percent of the corn c r o p l a s t we e k wa s i n t h e dough stage, 14 points behind the five-year average.

Meanwhile, 58 percent of the U.S. soybean crop last week was setting pods compared to the average of 68 percent.

“This crop will get adjusted as we go on down through the fall,” said Jim Neuschwander, an Iroquois County far mer who also is a USDA enumerator. “Late summer weather and fall weather will be very important.”

The U.S. Drought Monitor last week showed three quarters of Iowa and the northern half of Missouri was abnormally dr y or in a moderate

drought. Much of central and north-central Illinois also was abnormally dry as of last week.

“I’m really concerned about late maturity,” Neuschwander said. “The soybean crop always is dependent on late rains in August and September and both the corn and bean crops in my area will be dependent on a late frost.”

U S DA l a s t w e e k d i d n’t adjust its har vested cor n acreage estimate of 89.1 million acres. But a downward adjustment is expected.

The Farm Service Agency last week estimated 7.7 million acres of prevented plantings nationwide. The prevented plantings included 3.4 million acres of corn, 1.6 million acres of beans and 1.7 million acres of wheat.

USDA’s latest projected rang es for 2013-14 season prices were $4.50 to $5.30 per bushel (up 10 cents) for corn, $10.35 to $12.35 (up 60 cents) for beans, and $6.40 to $7.60, (down 10 cents), for wheat.

U.S. Grains Council: Corn exports could rebound in coming year

U.S. corn exports could rebound in the coming year after sinking to a 42-year low.

USDA last week projected corn exports for 201213 totaled just 715 million bushels compared to 1.54 billion bushels the previous year.

“This has been a very difficult year with a short crop (resulting from last year’s drought),” said Kim Darst, director of global programs for the U.S. Grains Council (USGC).

Darst last week met with participants of the Illinois Far m Bureau Marketers to Washington tour.

A short U.S. corn crop, due to the 2012 drought, combined with record high prices persuaded many world buyers to purchase corn from Argentina, Brazil and the Ukraine instead of the U.S., according to Darst.

“We’ve spent a lot of time meeting with customers

Tuesday: • Ag weather with Chesapeake Meteorology • Monica Nyman, St. Louis Dairy Council nutrition educator • Bradley Baer, Case IH marketing training manager Wednesday: • Tim Schweizer, Illinois Department of Natural Resources public relations liaison • Jim Bower of Bower Trading • Kent Kleinschmidt, Illinois Corn Marketing Board District 8 director Thursday: • Patriot Renewable Fuels five-year anniversary live broadcast • Half Century of Progress Show in Rantoul, with WITY 980 Friday: • Patriot Renewable Fuels five-year anniversary live broadcast To find a radio station near you that carries the RFD Radio Network, go to FarmWeeknow.com, click on “Radio,” then click on “Affiliates.”

to prevent demand destruction,” she said.

A large crop — USDA last week projected U.S. farmers this fall will harvest the largest corn crop (13.8 billion bushels) on record — and lower prices should rebuild demand for U.S. corn.

USDA last week estimated U.S. corn exports for 2013-14 will total 1.23 billion bushels.

“A l o t o f o u r h i s t o r i c a l b u y e r s l a s t y e a r b o u g h t ( c o r n ) f r o m o t h e r c o u n t r i e s ,” s a i d Michael Scuse, USDA acting deputy secretar y.

“Now, with the (lower) price and (higher) production, I think we’ll be able to g et most of those buyers back.”

U.S. corn producers have some very loyal customers in Japan, Taiwan and South Korea.

However, lost customers in Egypt and Morocco could be more difficult to regain due to logistics, according to Darst. Many corn buyers in northern

Africa now buy corn from the Ukraine.

“There will be some places we regain market share quickly,” Darst said. “And there will be other places that take years to regain.”

USGC in recent months hosted buyers from other countries so they could view the current crop as a reassurance there will be plenty of corn available this fall.

“China is going to remain a key focus of our market development program,” Darst said.

USGC’s market development activities could get cut short, though, if Congress doesn’t pass a new farm bill. Much of the grains council’s market access and market development programs are funded via the farm bill.

“If there is no farm bill in the next six months or so, we may have to close offices and ter minate employees overseas,” Darst added. — Daniel Grant

HEALTHY DISCUSSION

Gallatin County Farm Bureau President Hugh David Scates, right, chats with Illinois Senate President John Cullerton, left in white shirt, during a health fair for Chicago school children. Farm Bureau leaders from Cass, Cook, Gallatin, Morgan and Saline counties distributed ag education materials to 5,000 students for a seventh year. The county Farm Bureaus assisted long-time adopted legislator Sen. William Delgado, D-Chicago, who hosts the fair, and adopted legislator Rep. Luis Arroyo, D-Chicago, who represents the area. (Photo by Christina Nourie, Illinois Farm Bureau northeast legislative coordinator)

TRANSPORTATION

FarmWeek Page 8 Monday, August 19, 2013

Rail investment, incentives key to accommodate ag?

BY MARTIN ROSS FarmWeek

While rail capitalization has been strong over the last decade, new investments appear crucial to major carriers staying connected with their ag customers.

Kendell Keith, an analyst

with TRC Consulting who has assessed rail needs and opportunities for the checkoff-supported Soy Transportation Coalition, anticipates overall U.S. freight movement expanding, albeit at a slower pace than the nation’s general gross domestic product.

Above, Tim Mueting, engineering ser vices manager with GROWMARK, inspects a new Eastern Grain Marketing LLC rail loading facility at Kankakee that can accommodate up to a 120-car rail shuttle or containerized corn or soybean shipments. An 8,000-foot rail loop connects with the Norfolk Southern rail line, and the facility — site of an open house last week — includes 2.1 million bushels of storage and grain drying capabilities. Below is the facility’s shipping tower. (Photos by Ken Kashian)

Keith sees “pretty strong evidence” rail is beginning to outpace truck freight growth.

Ag rail use should increase due to expanding exports and the ethanol “blend wall” — prospective saturated demand for existing 10 percent ethanol/gasoline blends likely to result in a resurgence in grain rail movements that slowed amid the “ethanol boom,” he said.

However, Keith warned the existing rail system is reaching maximum capacity. He suggests federal incentives particularly for development of larger railyards could aid carriers in improving overall rail sustainability.

“The short-term outlook is pretty good,” he told FarmWeek. “We’ve got quite a bit of capacity now because we had a short crop last year. But we’re entering a phase of gradual growth with the ag sector growing in addition to the rest of the economy. The outlook is for rail capacity to tighten up in 2014.

“That doesn’t mean we’re not going to have the capacity to move ag commodities. I think we will. But in essence, we have to start thinking about infrastructure, how we get some expansion of infrastructure in places that make sense.

We need to think about investment policies that make sense.”

Tracking needs John Grassley, rail services

director with farmer-owned grain and energy company CHS, sees several ag “macro market drivers” that could impact rail demand, from shifting commodity supply/demand dynamics and crude oil delivery and biofuels expansion (see story on page 9) to future fertilizer distribution needs within a tighter spring window.

Increased investment in U.S. agriculture and ag infrastructure (including key ports) and consolidation along with new players in the global ag sector suggest a need for rail upgrades, Grassley said. And given the role of biotechnology and precision farming in boosting yields, he anticipates “more to move, and that’s going to change things.”

Moving ahead U.S. rail infrastructure today is “in pretty solid shape,” Union Pacific (UP) vice president and ag product general Manager Paul Hammes suggests. However, given improved returns over the last several years, he maintains “the (customer) signal is there to reinvest in this business.”

The U.S. rail industry has invested roughly $98 billion

(see accompanying chart) with UP alone investing $34 billion in capital needs over the last decade. UP plans to invest $2.1 billion in infrastructure replacement this year. Its 2013 track replacement program is a little more than half-complete.

While Hammes acknowledged “last year was kind of weak on grain shipments,” he stressed agriculture overall “really held its own” in 2012.

Ag accounted for roughly 11 percent of U.S. rail shipments last year, but Hammes sees grain and oilseed, ethanol, food and related shipments increasing to 12 or 13 percent heading into 2014.

“There’s a strong linkage between rail and ag,” he stressed. “Ag’s 13 percent of the rail business, and rail’s 37 percent of ag’s business. It’s an important piece, and we recognize that.

“Shipping variability is a challenge for us. We have so many fixed resources, and it’s a network with a lot of moving parts and a lot of different products working through it.

But I think we have some good processes, and I think we’ve responded pretty well.”

COSTS AND BENEFITS Transportation analyst Kendell Keith estimates that for a cost of $981 million in “lost” tax revenues, federal rail investment tax credits would generate $2,296 million in economic benefits, including: • $98 million in benefits in terms of lower rates and higherspeed product handling for the soybean sector alone; • general rate reductions of roughly $635 million for other sectors reliant on rail; • an estimated $268 million freight cost savings resulting from a shift in truck traffic to rail; • $700 million in reduced highway maintenance costs; • $595 million in savings due to reduced highway congestion; • 30,000 added construction jobs.

Keith sees the need for rail incentives throughout the system.

A short line rail maintenance tax credit deemed crucial in keeping thousands of customers connected to the national freight network has undergone a series of short-term extensions. The latest expires at year’s end.

Regional short lines account for 40 percent of ag rail volume “at one end or the other,” and must offer the capacity to handle larger rail cars compatible with larger carrier logistics, Keith said.

“We’re going to get economic growth in this country or we’re all going to be in trouble,” he told FarmWeek. “The question is, where do we get the growth? You can’t predict that with great certainty, so you really have to expand base infrastructure in a general sense.” — Martin Ross

TRANSPORTATION

Page 9 Monday, August 19, 2013 FarmWeek

Energy cushions rail sector; competition, policy issues arise

BY MARTIN ROSS FarmWeek

Much of America’s energy still rides the rails. But it’s a far different mix today.

And biofuels are helping make the ride less bumpy for major rail carriers, according to transportation consultant Kendell Keith.

Amid declining coal volumes and with service to other sectors “a little bit more unpredictable” as trucking

and rail compete for freight transportation, a “booming” petroleum industry has played a key role in cushioning carriers, Keith told FarmWeek.

Heavy investment in rail ethanol infrastructure from 2007-09 has also helped provide added stability in rail flows. Keith cites the industry’s “resiliency” in adapting rapidly to new growth areas and notes “a lot of investments took place to get

Rail, regs and rates: STB taking hard look

In the midst of rail capitalization and commerce, Federal Surface Transportation Board (STB) Chairman Daniel Elliott stresses the need for shipper cost-effectiveness and competitiveness.

Elliott notes his agency’s heightened efforts to “strike a balance among all stakeholders,” enabling rail carriers to reinvest in infrastructure while ensuring ag interests can “ship their goods anywhere, any time, at reasonable rates.”

He called the U.S. freight rail sector “a model of business efficiency” and argued major carriers are among “the most profitable entities in this country,” due in part to rail deregulation under the 1980 Staggers Act. “Deregulation worked so well that many shippers feel there’s now a lack of real competition,” Eliott nonetheless conceded.

“They argue mergers have left the country dominated by two regional (carrier) duopolies that increasingly offer high, take-itor-leave-it rates to customers who have no other transportation alternative.

‘Deregulation “I have asked our stakeholdwo r ke d s o we l l ers how, if and where the board that many ship- should update its rules and procedures in light of the many pers feel there’s changes in the rail industry that now a lack of real have occurred in the wake of deregulation.” competition.’

Following a 2011 hearing featuring testimony from rail and — Daniel Elliott shipping interests, the board began formulating rules for Chairman, Surface improving “rail-to-rail” compeTransportation Board tition through use of reciprocal switching, where inbound or outbound cars are switched by one railroad to or from another’s rail siding.

The STB is reviewing a proposal to grant shippers who lack effective alternatives greater access to competing rail lines.

Elliott cited concerns about the plan’s impact on rail economics, shipper rates and services, and “captive shippers” often limited to a single carrier and unable to benefit from the new rule.

Meanwhile, the board is working to help enable captive shippers to challenge rates. Many shippers have been reluctant to file disputes because of high legal costs related to the board’s “complex” standards for determining reasonable rates, Elliott said.

The STB has developed a simplified test that factors case-bycase variables and a “three-benchmark test” that compares disputed rates to those for similar rail traffic. Because simplified procedures are less precise than previous tests, the board capped the amount of rate relief available to shippers who file under them.

This fall, the STB will review possible new grain rate dispute/relief procedures. No grain shipper has filed a rate complaint with the STB in 30-plus years “despite the fact that a great number of these shippers are captive to a single railroad,” Elliott noted.

STB’s proposal would “automatically reflect economies of scale” relative to shipment size increases and rail unit costs and more accurately assess rail variable costs to “ensure rates that should be subject to challenge indeed are,” he said. — Martin Ross

ethanol shipped by rail.”

“Now we’re seeing a lot of investments in fracking and (tar) sands oil delivery,” he reported. “The energy sector is truly a basis for growth in the U.S. economy.

“And the biofuels sector is steadier today. Growth in biofuels, if we allow it to happen, is tremendous for rail. It’s helping to fill in some of the blanks coal has left.”

According to the U.S. Energy Information Administration (EIA), increased use of rail for oil transport is due largely to heightened crude oil production in North Dakota and Texas that’s exceeded pipeline capacity.

The amount of petroleum products transported by rail totaled close to 356,000 carloads during the first half of 2013, up 48 percent over that period in 2012. However, EIA notes the pace of that growth is leveling out.

Ethanol moves from plant to blending and export terminals primarily by rail. Creation of federal Renewable Fuel Standard ethanol man-

dates in 2005 spurred a boom in rail tank car lease rates and tank car production that subsided after the 2008 recession and a drop in gas consumption.

But several biofuels producers are poised to launch new cellulosic ethanol operations, adding millions in new gallons to the rail network.

And with crude oil-by-rail becoming a “bigger piece of the pie,” John Grassley, rail services director with farmer-

owned grain and energy firm CHS Inc., questions “what happens to (rail) capacity.”

At the same time, Grassley warns federal biofuels policy shifts could impact the cushioning effect of railed biofuels.

“Thirty-five to 40 percent of U.S. corn acreage is now used for biofuel,” he noted.

“What happens if the government mandate changes? That would have a huge impact not only for agriculture but for the rail industry, as well.”

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ENERGY

FarmWeek Page 10 Monday, August 19, 2013

Oil industry waiver request ‘publicity stunt’?

BY MARTIN ROSS FarmWeek

A petroleum industry group’s latest attempt to marginalize ethanol amounts essentially to a “publicity stunt” with questionable factual or legal grounding, Renewable Fuels Association (RFA) vice president of research and analysis Geoff Cooper told FarmWeek.

The American Petroleum Institute (API) has asked the U.S. Environmental Protection Agency (EPA) to fix ethanol blending levels at 9.7 percent of projected gasoline demand under the Renewable Fuel Standard (RFS2) in 2014. Currently, the standard gasoline blend includes 10 percent ethanol.

API’s proposal would undermine Congress’ intent through RFS2 “to drive greater consumption of biofuels, including ethanol,” via higher blend levels, Cooper said.

Rather than offering new information, API’s 129-page ethanol waiver request largely

collects data previously used to challenge RFS2 and adoption of E15 (15 percent ethanol blends EPA’s cleared for 2001 and later vehicles), he said. And given RFS2 waiver criteria under 2005 energy statutes, Cooper

“We don’t think the petition they’ve put in has any merit whatsoever,” Cooper said. “It’s all very speculative, and they’ve totally disregarded the fact that EPA already has announced its intention to adjust 2014 RFS2 require-

‘We don’t think the petition they’ve put in has any merit whatsoever.’

— Geoff Cooper Renewable Fuels Association

argues EPA “doesn’t even need to respond to it.”

API’s attempting “to convince EPA RFS2 requirements next year and beyond are going to somehow affect gasoline prices for consumers,” Cooper said. API suggests RFS2-driven ethanol demand will boost prices for renewable identification number (RIN) credits fuel suppliers can purchase in lieu of blending higher biofuel levels, thus raising pump prices.

ments given some of the constraints we’ve seen in the marketplace.

“The other thing is, we’re not sure they actually have standing to submit a waiver petition. The statute is pretty clear about who can and cannot submit a petition.

It’s limited to either a state, which would be a governor, or a party subject to the regulations — an individual refining company, not a trade group. API’s not sub-

ject to the RFS2.”

He cites continued questions even about what EPA “can and can’t do” in terms of adjusting annual RFS2 targets. Congress authorized the agency first to consider reducing cellulosic biofuels requirements if overall biofuels use mandates appear unachievable.

The industry has accepted EPA’s decision to reduce original statutory cellulosic targets for 2013. Cooper acknowledges “(EPA) will do so again in 2014,” although several cellulosic plants soon are expected to come online.

If further adjustments are deemed necessary, EPA can look next at the total “advanced biofuels” target, which includes cellulosics, Brazilian sugarcane ethanol and other next-generation fuels. EPA left the advanced biofuels target intact for 2013, but it could reduce the amount of imported cane ethanol that enters the

market under the RFS2.

According to Cooper, EPA does not have authority to adjust the RFS2’s remaining “renewable fuel” category, which includes cornstarchbased ethanol. The statutory 2014 target for corn-based ethanol is 14.4 billion gallons, on track toward a tentative 15 billion-gallon hard cap in 2015.

RIN trading is based largely on regional availability of biofuels supplies. Ethanol supplies tightened and RIN use increased following the 2012 drought and idling of production nationwide.

Ethanol production has now rebounded to about 92 percent of current industry capacity, Cooper noted.

Anticipated entry of commercial-scale cellulosic fuels production should lay waste to the oil industry’s “running joke” that cellulosics are perpetually “a few years away,” Cooper said. “It’s here today,” he said.

Sorghum Illinois biofuels candidate?

For most Illinois growers, sorghum’s usually an afterthought.

To National Sorghum Producers (NSP) CEO Tim Lust, it’s an admittedly “non-traditional” Corn Belt option that’s nonetheless field-proven and offers potential for next-generation cellulosic ethanol production or elevation of corn ethanol to higherdemand “advanced biofuels” status.

Three major types of sorghum are cultivated — grain sorghum raised in some southern Illinois counties, and biomass and sweet sorghum now being tested in university and commercial research plots.

Global sorghum production has been based on water use efficiency, Lust noted. However, the U.S. Environmental Protection Agency (EPA) has approved grain sorghum as a conventional ethanol feedstock (like corn) under the federal Renewable Fuel Standard (RFS2), based on its 32 percent greenhouse gas (GHG) reduction score relative to gasoline.

Lust attributes grain sorghum’s GHG rating to calculation of its potential for “indirect land use change” — the notion energy crops displace environmentally sensitive lands worldwide. But if conventional ethanol plants make major “green” improvements, they could achieve a 50 percent GHG reduction threshold for advanced biofuels, he said.

Sorghum-based “biogas” could offset natural gas use in ethanol plants, reducing costs and the petroleum-based carbon footprint associated with corn-based biofuels production, Lust said. Western Plains Energy has broken ground for a biogas-generating anaerobic digester in sorghum-rich northern Kansas, and a California facility may not be far behind.

Further, NSP is seeking advanced feedstock status for sweet sorghum, a fuel-feed crop which scores “very high” in GHG reductions, and biomass sorghum, which reportedly can yield 1,184 gallons per acre with a 90- to 110-day growing window. Lust stressed RFS2 applicants must ensure they can “deliver the gallons” and is encouraged by Midwest potential.

“Sorghum’s been grown in the southern end of (Illinois) for a number of years,” Lust told FarmWeek. “There are a lot of opportunities there.”

“When sorghum has better soils, better moisture, better nutrients, it responds. We’ve been excited by some of the very high yields we’ve been able to get in sweet and biomass sorghum both in Iowa and Illinois. They could be very competitive with existing crops.”

Biomass sorghum’s short production window enables bioenergy producers to quickly add contract acres, Lust said. The opportunity to quickly generate sorghum seed offers a “huge advantage” for cellulosic biofuels plants seeking to lock in feedstocks and initial plant financing, he said. — Martin Ross

AGRONOMY DAY

Page 11 Monday, August 19, 2013 FarmWeek

Nafziger: Cool temps delaying soybean, corn development

BY KAY SHIPMAN FarmWeek

Soybeans, unlike people, are not enjoying the cool summer temperatures. Neither is the corn.

University of Illinois crop science professor Emerson Nafziger didn’t need to look far to illustrate the unusual temperatures because several people sported jackets last week at Agronomy Day on the Crop Sciences Research and Education Center, Urbana.

“Soybeans are a worry because we still have flowers on this crop,” Nafziger said.

“We don’t have pods. They’re just not there. Cool night temperatures really wreak havoc with a soybean crop.”

He noted soybeans do better with night temperatures of 70 degrees Fahrenheit.

“I’m afraid we’ll end up

with a (soybean) crop months from now with (smaller) seed size,” Nafziger said.

“We have to have good conditions in September.”

However, soybean development wasn’t Nafziger’s only worry. Corn also needs higher temperatures for better development.

A best daytime temperature for corn would be 90 degrees,” he said.

But the cool temperatures have saved the corn from being stressed by a shortage of moisture. “Today we have enough water thanks to the cool temperatures,” Nafziger said.

However, Nafziger projected the corn could handle the current conditions better than the soybeans.

“My bigger concern is soybeans right now,” he concluded.

Illini hoops coach says 4-H lessons apply to his team

Big Ten basketball players could learn from 4-H’ers and farm youngsters in the eyes of John Groce, University of Illinois men’s basketball coach.

Groce told a large U of I Agronomy Day crowd that he applies lessons he learned as a farm boy and 4-H member when he coaches his athletes.

Work ethics? “I learned that growing up on the farm,” Groce said. He joked it was good that he primarily showed gilts ‘A lot of core val“because you become ues for me came emotionally attached to from living on a the animal.”

The coach recognized fa r m , f r o m 4 - H his fifth-grade teacher and and college.’

4-H leader, Janet Stephenson, who sat listening to her former student.

— John Groce Stephenson was a memoU of I basketball coach rable teacher and 4-H leader “because of her compassion. You felt like she cared,” Groce said.

The importance of such core values as integrity, commitment, unity and passion are stressed to U of I players, staff and coaches, Groce said.

“A lot of core values for me came from living on a farm, from 4-H and college,” Groce said. “If our team, staff and coaches exemplify those values, the score will take care of itself.”

He also drew a parallel between the U of I College of Agricultural, Consumer and Environmental Sciences and his basketball team. Both the college and the team are reaching out and extending themselves, Groce said.

The tall, articulate man reminded his former teacher of a young student and member of the Happy Farmers 4-H Club in Danville, Ind., Stephenson said.

“When he was speaking, it sounded a lot like when he was in fifth grade,” she said with a smile.

Young people involved in 4-H learn to set a goal and complete it and learn to interact with others, Stephenson noted. — Kay Shipman

University of Illinois crop science professor Emerson Nafziger shares his concerns about this year’s corn and soybean yields given cool temperatures and moisture shortage. (Photo by Kay Shipman)

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THE RIVERS

FarmWeek Page 12 Monday, August 19, 2013

Water bill key to farmers, â&#x20AC;&#x2DC;coal mining familiesâ&#x20AC;&#x2122;

Davis touted measures he has spearheaded with East Moline Democrat Ag/Transportation Committee colleague Cheri Bustos that would encourIllinoisâ&#x20AC;&#x2122; long-suffering coal industry is one more age public-private waterway improvement partnerpotential casualty of Congressâ&#x20AC;&#x2122; farm bill stalemate, ships â&#x20AC;&#x153;that would allow us to really move on according to Taylorville Republican U.S. Rep. Rodupgrading our infrastructure.â&#x20AC;? ney Davis.

He recognizes a push by barge and shipping Appearing at the Illinois State Fair, Davis interests to raise their own barge fuel taxes in told FarmWeek that had lawmakers been able â&#x20AC;&#x2DC;We need that river to keep coal min- an effort to replenish the Inland Waterways to pass original House Ag farm bill proposals, Trust Fund (IWTF) â&#x20AC;&#x201D; currently, the waning â&#x20AC;&#x153;we probably could have marked WRDA (the ing families employed.â&#x20AC;&#x2122; repository for cost-share funding of lock federal Water Resources Development Act) up improvements. At the same time he appreciin July.â&#x20AC;? ates that voluntary industry gesture, Davis Pushing WRDA debate into September â&#x20AC;&#x201D; U.S. Rep. Rodney Davis maintained shippers want assurance through increases the threat of continued waterway infraTaylorville Republican WRDA reforms that both waterways and harstructure decline not only for exporting grain bor maintenance trust funds are used for their farmers but also for Illinoisans dependent on coal intended purpose.

Gibbs, R-Ohio, to move â&#x20AC;&#x153;good long-term reformsâ&#x20AC;? mining and shipping, Davis said.

Davis noted federal use of trust fund monies in U.S. Army Corps of Engineers navigation â&#x20AC;&#x153;They donâ&#x20AC;&#x2122;t burn that coal in Illinois. They donâ&#x20AC;&#x2122;t â&#x20AC;&#x153;to prolong projects that have been overwhelmingimprovement/operations policies in September, burn the coal in America as much as they do in ly expensive,â&#x20AC;? such as long-delayed Olmsted Lock said Davis, a member of both House ag and transAsia,â&#x20AC;? he said in an onstage RFD Radio interview. and Dam improvements marked by billions in cost portation committees. â&#x20AC;&#x153;We need that river to keep coal mining families overruns.

WRDA proposals would relieve the IWTF of future funding for Olmsted work, freeing barge tax revenues to â&#x20AC;&#x153;move the infrastructure forward,â&#x20AC;? he said. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s unacceptable to me as an American and as a congressman that the Corps, even if fully funded today, would take 40 years to upgrade our locks and dams,â&#x20AC;? Davis said.

He also has partnered with Belleville Democrat and Ag Committee member William Enyart to upgrade river forecasting and weather-related response capabilities and thus get ahead of events such as this past winterâ&#x20AC;&#x2122;s low-water conditions south of St. Louis.

BY MARTIN ROSS FarmWeek

employed in Macoupin, Montgomery and other counties.â&#x20AC;?

House Transportation and Infrastructure Chairman Bill Schuster, R-Penn., is â&#x20AC;&#x153;working diligentlyâ&#x20AC;? with Water Resources Subcommittee Chair Bob

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FROM THE COUNTIES

Page 13 Monday, August 19, 2013 FarmWeek

B

ROWN — Farm Bureau and COUNTRY Financial will sponsor a customer appreciation open house from 4 to 7 p.m.

Thursday at the Mt. Sterling American Legion Hall. Call the Farm Bureau office at 773-2634 or the COUNTRY Financial office at 773-3591 for more information.

HRISTIAN — Farm Bureau will host an informational meeting regarding oil and gas leases at 6 p.m. Aug. 27 at the Farm Bureau building.

Reservation deadline is Friday.

OOK — Farm Bureau is offering discounted tick-

C C

ets to Raging Waves Water Park in Yorkville. Visit {tickets.ragingwaves.com} to purchase tickets or for more information.

• Farm Bureau is offering discounted tickets to Medieval Times Dinner and Tournament. Visit the member’s only section at {cookcfb.org} for more information and a direct link to purchase tickets.

• Farm Bureau will sponsor a giant pumpkin contest on Oct. 5 at Puckerville Farms in Lemont. Visit {cookcfb.org} for registration, entry guidelines and prize information.

ORD-IROQUOIS — Young Ag Leader mem-

F

READING PROGRAM F0CUSES ON AG

bers will sponsor a farm value meal from 5 to 7 p.m. Saturday at the Sheldon Fire Department during the Sheldon Fun Days. Cost will be $1.50.

• Farm Bureau will sponsor a pork chop supper from 5 to 7 p.m. Aug. 26 and 27 at the Farm Bureau building in Gilman. Call 800-424-0756 for reservations or more information.

AWRENCE — Farm Bureau will sponsor a chartered bus trip to the Farm Progress Show in Decatur leaving at 6:30 a.m.

Aug. 27 from the Lawrenceville Christian

L

Auction Calendar

Mon., Aug. 19. 10 a.m. Iroquois Co. Farmland. Marian L. Laurent Trust, ST. ANNE, IL. Decker Real Estate and Auction Co. www.deckercompany.net Tues., Aug. 20. 10 a.m. Farmland Auc. Edward Dickwisch Est., CARTHAGE, IL. Sullivan & Son Auction LLC. www.sullivanson.com Tues., Aug. 20. Pre-Fall Machinery Con. Auc. DANA, IL. Terry Wilkey Auction Service. www.terrywilkey.com Tues., Aug. 20. 11:30 a.m. Farmland Auc. Don and Phyllis Housewright, CARTHAGE, IL. Sullivan & Son Auction LLC. www.sullivanson.com Wed., Aug. 21. 10 a.m. Farmland Auc. Harry Bennett Jr. Est., LAHARPE, IL. Sullivan & Son Auc., LLC. www.sullivanson.com Thurs., Aug. 22. 10 a.m. Piatt Co. Land Auc. MONTICELLO, IL. Hertz Real Estate Services. www.hertz.ag Thurs., Aug. 22. 10 a.m. Adams Co. Farmland. Lucille Wollbrink Est., MENDON, IL. Sullivan & Son Auction. www.sullivansonauction.com Fri., Aug. 23. 10 a.m. Farm machinery.

David and Margaret Gibb, PIPER CITY, IL. Immke and Bradley Auction Service. biddersandbuyers.com/immke Fri., Aug. 23 and Sat., Aug. 24. 9:30 a.m. both days. Consignment Auc. Gordon Hannagan Auction Co. www.gordyvilleusa.com Sat., Aug. 24. 10:30 a.m. Greene Co. Land Auc. Terry and Melissa Hutton, GREENFIELD, IL. Moss Auctioneers. www.auctionzip.com ~ id #21727 Sat., Aug. 24. 10 a.m. Public Auction.

BEMENT, IL. Central IL Auctions. www.topauctions24-7.com or auctionzip.com ~ id#12596 Sat., Aug. 24. 1 p.m. Schuyler Co. Land Auc. Tim and Suzette McCoy, RUSHVILLE, IL. Sullivan Auctioneers. www.sullivanauctioneers.com Sat., Aug. 24. 9 a.m. Con. Auc.

LAWRENCEVILLE, IL. Max Groff, Auctioneer.

Sat., Aug. 24. 9 a.m. Pre-Harvest Con. Auc. LELAND, IL. Mike Espe, Chris Wegener, Joe Wegener and Mike Peterson, Auctioneers. www.espeauctions.com Sat., Aug. 24. 11 a.m. Real estate, machinery and misc. Charles Edwin Pearce, JR., FLORA, IL. Carson Auction & Realty Co. www.carsonauctionandrealty.com Wed., Aug. 28. 10:30 a.m. Lee Co. Land Auc. Clarence O. Svela Trust, ASHTON, IL. Lenny Bryson, Auctioneer. www.lennybrysonauctioneer.com Fri., Aug. 30. 6 p.m. Farmland Auc. Helen Taylor Est., BRIMFIELD, IL. Sullivan & Son Auction, LLC. www.sullivanson.com Fri., Aug. 30. 6 p.m. Farmland.

Reichneker and Guingrich, BRIMFIELD, IL. Sullivan & Son Auction. www.sullivansonauction.com Wed., Sept. 4. 10 a.m. LaSalle Co. Farmland Auc. State Bank of Graymont, KERNAN, IL. Bradleys’ and Immke Auction Service. www.bradleyauctionsinc.com Wed., Sept. 4. 10 a.m. Land Auc. John Moore Est. Krile Auction Service. www.auctionzip.com Thurs., Sept. 5. 10 a.m. Farm Eq. and Livestock Eq. Auc. Margaret Conrady Estate, Mike Conrady, Tom Conrady, MIDDLETOWN, IL. Mike Maske Auction Service.

Thurs., Sept. 5. 7 p.m. Fayette Co. Farmland Auc. Ley Deal Farms, Inc., VANDALIA, IL. Langham Auctioneers, Inc. auctionzip.com id #14627 Thurs., Sept. 5. 7 p.m. Farmland Auc. Heirs of Orval Friedrich, NEW ATHENS, IL. Riechmann Auc. Service. www.riechmannauction.com Thurs., Sept. 5. 10 a.m. Henry Co. Land Auc. ANNAWAN, IL. Hertz Real Estate Services. www.hertz.ag

L

P

Adopted legislator tours specialty ops Specialty agriculture took center stage recently when Rep. Elaine Nekritz, DNorthbrook, visited Winnebago-Boone Far m Bureau.

The adopted legislator met with board members and

Tricia Kinner, a Sangamon County Farm Bureau Women’s Committee member, reads “Who Grew My Soup,” to children at Pleasant Plains Library. Committee members also talked with young readers about soybeans and their many uses during the summer reading program. (Photo by Ashley Beutke, Sangamon County assistant manager)

Church parking lot next to Borowiak’s IGA. Cost is $30 for active members and $35 for nonmembers. Call the Farm Bureau office at 9432610 to register or for more information.

IVINGSTON — The Farm Bureau Foundation will host a trap shoot fundraiser at 8:30 a.m. Sunday. All proceeds will benefit the Elite Foundation Scholarship.

EORIA — Farm Bureau will sponsor a grassroots picnic at 6 p.m. Tuesday at the Farm Bureau Park.

• Farm Bureau will spon-

young leaders while touring Steffenhagen Vineyards and Mulvain Woodworks near Durand.

Nekritz discussed agricultural concerns during a local foods lunch prepared by Toni’s in Winnebago.

sor a photo contest for members or dependents.

Photos must be taken in Peoria County to be eligible.

Entry deadline is Aug. 30.

• Farm Bureau will host a Stroke Detection Plus health screening on Aug. 27 in the Farm Bureau auditorium.

Members will receive a discount. Call 877-732-8258 for reservations.

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

CLARIFICATION

Dennis Thompson gave testimony as an individual and did not represent any organization before the recent Illinois Senate Subcommittee on Food Labeling, which held a hearing in Carbondale.

PROFITABILITY

FarmWeek Page 14 Monday, August 19, 2013

Propane market poses wildcard in harvest planning Fair time always proves a great chance to get caught up with old friends. This year, we have the added bonus of amazing weather. Interestingly enough, as I talked with producers this summer, the conversation shifted toward propane demand for grain drying.

Last year, demand was nonexistent due to the drought and quality concerns. This year’s crop has huge potential. Combined with the late planting and cooler summer, it could push propane demand in the Midwest nearer to the levels seen in 2009 and 2010.

As you might remember, fall 2009 crop drying put tremendous pressure on the industry’s ability to keep pace

BY RANDY MILLER

with demand. April through July heating degree days for Peoria in 2013 were only 7 percent above 2009 levels, and the second lowest in the last five years. Below normal temperatures in early August could be setting us up for another wet corn crop. Let’s look at some factors that could affect propane prices this fall.

Current U.S. inventories are in good shape heading into the grain drying and heating season. U.S. total propane stocks are only 6 percent below last year, but 8 percent above the five-year average.

The big difference is in the Midwest, where inventories — at 21 million barrels — are 22 percent below last year and 12 percent below the five-year

East-central Illinois water supply focus of conference Sept. 13

The water supply for east-central Illinois will be discussed Sept.

13 at a regional water stakeholder conference in the Macon County Extension office, Decatur. The registration deadline is Sept. 9.

The program will start at 9 a.m. and conclude at 4:15 p.m.

Topics discussed will include groundwater computer models and lessons learned from the 2012 drought, watershed programs and hydraulic fracturing. An expert panel will discuss water’s role in attracting new businesses to a community. Tours of Decatur’s water treatment and wastewater treatment plants will be offered in the afternoon.

Illinois Farm Bureau is one of the conference sponsors.

The registration fee is $45 for adults and $25 for students.

Checks should be made to the Mahomet Aquifer Consortium.

For more information or to register, contact Robbie Berg, consortium coordinator, 201 Devonshire Drive, Champaign, Ill., 61820 or email MAC1998_15@yahoo.com.

M A R K E T FA C T S Feeder pig prices reported to USDA* Total Composite Weighted Average Receipts and Price (Formula and Cash): All Early Weaned Pigs: 99109 at $39.48 All 40 Pound Feeder Pigs: 11418 at $55.26 Recipts

This Week 110,527 *Eastern Corn Belt prices picked up at seller’s farm

Last Week 83,716

Eastern Corn Belt direct hogs (plant delivered) Carcass Live

(Prices $ per hundredweight) This week Prev. week Change $96.01 $95.44 $0.57 $71.05 $70.63 $0.42

USDA five-state area slaughter cattle price (Thursday’s price) Steers Heifers

This week NA NA

Prev. week $122.67 $119.00

Change NA NA

CME feeder cattle index — 600-800 Lbs. This is a composite price of feeder cattle transactions in 27 states.

(Prices $ per hundredweight) Prev. week Change This week $152.36 $150.24 $2.12

Lamb prices Slaughter Prices — Negotiated, Live, wooled and shorn 115-168 lbs. for 108.23-138 $/cwt. (wtd. ave. 116.84); 178-182 lbs. for $114/cwt. (wtd. ave. $114/cwt.)

Export inspections (Million bushels) Week ending Soybeans Wheat Corn 8/8/2013 3.4 23.8 14.8 8/1/2013 1.4 29.4 15.1 Last year 15.9 22.4 23.2 Season total 1302.9 240.1 657.5 Previous season total 1311.3 190.5 1453.1 USDA projected total 1330 1075 700 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

average. Midwest stocks are about 26 percent below the 28 million barrels available in fall 2009, our last big grain drying year.

Several factors are in play. U.S. propane prices are very attractive compared to Randy Miller world prices, resulting in the U.S. becoming a major exporter.

Pipeline improvements

have allowed Midwest propane production to be shipped to the Gulf Coast, causing inventories in the Midwest to grow at a slower rate than in past years. These improvements have come about due to shale plays where natural gas is being fractionated into propane and other natural gas liquids, relieving the glut of propane inventories in the Midwest traditionally seen in summer months.

Last year, we were concerned we would run out of storage!

Propane is also moved to the Gulf Coast to meet petro-

chemical industry demand. With a now growing economy and somewhat inexpensive propane supply, demand from petrochemical plants is at an all-time high — a trend that is likely to continue throughout the year.

Grain drying demand this fall will likely add volatility to propane prices. Now is the time to work with your supplier and have a plan ready for this fall.

Randy Miller is GROWMARK’s director of propane operations. His email address is rmiller@growmark.com.

NGFA: Proposed protection rule could increase risk

BY DANIEL GRANT FarmWeek

The National Grain and Feed Association (NGFA) supports the enhancement of customer protection measures for the ag futures trading business in the wake of the MF Global bankruptcy nearly two years ago.

But NGFA is concerned a rule proposed by the Commodity Futures Trading Commission (CFTC) actually could increase risk for customers, such as country elevators.

CFTC proposed a customer protection rule that would decrease the time in which customers’ margin calls must arrive to their futures commission merchant (FCM) from three days to just one day.

A second provision of CFTC’s proposal would change the timing of FCM’s calculation of “residual interest,” which are the funds the FCM contributes from its own money to top off customer accounts until margin calls are received.

“We think (the proposed customer protection rules) could increase costs and increase risk,” Todd Kemp, vice president of marketing and treasurer of NGFA, told participants of the Illinois Farm Bureau Marketers to Washington tour.

NGFA is concerned the proposed rule would trigger FCMs to require customers to premargin their hedge accounts.

Todd Kemp, right, vice president of marketing and treasurer of the National Grain and Feed Association, discusses marketing issues with Illinois Farm Bureau members, left to right, Dean Doughty (Peoria County), Roger Wahls (Livingston County) and Steve Drendel (DeKalb County), during the IFB Marketers to Washington tour. (Photo by Daniel Grant)

“That would result in customers being required to send more money to their FCM, potentially putting a greater amount of segregated customer funds at risk in the event of another FCM insolvency,” John Heck, chairman of NGFA’s Finance and Administration Committee, testified last month during a hearing held by the Senate Ag Committee.

NGFA instead would prefer to see reforms to the bankruptcy code, including tougher penalties, and some type of insurance program for futures customers.

“We like the idea of some type of insurance for futures customers,” Kemp said. “We’d prefer it to be optional. Obviously, there would be some sort

of cost with that.”

Customer protection in the futures market became a major issue after MF Global declared bankruptcy on Halloween 2011.

The company wasn’t able to account for roughly $1.6 billion in customer-segregated funds after it became ensnarled in the European Union debt crisis.

“They weren’t supposed to use customer-segregated funds.

That’s where fraud took place,” said Steve Drendel, a farmer from DeKalb County who had a segregated account with MF Global. “It’s the customer that’s going to have to foot the bill.”

Kemp last week estimated about 11 percent of funds hadn’t been returned to former MF Global customers.

Local efforts, global issues at Illinois River Conference

The 14th biennial Governor’s Conference on the Management of the Illinois River System will be Oct. 1-3 in Peoria’s Four Points by Sheraton.

The early registration deadline is Sept. 15.

Pre-conference activities Oct. 1 include a conservation tour and a separate drought workshop and RiverWatch symposium. The all-day bus tour will make seven stops in central Illinois. The tour is open to the public, but reservations are required and will be taken on a first-come basis.

Illinois Farm Bureau is one of the sponsors.

The symposium and drought workshop will be from 9 a.m. to 5 p.m. in the Four Points by Sheraton. The symposium will cover river education, action and monitoring. Drought workshop participants will discuss drought issues and identify research needs.

The evening of Oct. 1, Lt. Gov. Sheila Simon will host the Illinois River Coordinating Council meeting that will include an open forum for

public questions and comments.

Conference speakers will address industry and conservation, Illinois in the global economy, the Great Lakes and Mississippi River Interbasin Study and local work with river resources.

On Wednesday evening, participants may take a cruise on the Spirit of Peoria River Boat.

The conference will offer exhibits and an interactive digital technologies open house.

Registration fees are $175 for the full conference, including the cruise; $95 for Wednesday with cruise or Thursday; $50 symposium; $40 conservation tour and $25 boat cruise only. Special accommodation rates at the Four Point by Sheraton will be available until Sept. 2.

The conference schedule, including pre-conference activities and registration form, is available online at {conferences.illinoi.edu/ilriver} or by calling the University of Illinois office of online and continuing education at 217-244-7657.

PROFITABILITY

Page 15 Monday, August 19, 2013 FarmWeek

CASH STRATEGIST

Corn, wheat exports steady; soybean demand slacking

Soybean export shipments have continued to decline since late winter, as the majority of the international business has been shifted towards South America. However, this past week, the USDA did confirm 110,000 metric tons of U.S. soybeans were sold to China for the 2013-14 marketing year. If fresh sales do not continue to come in on a regular basis, it is possible U.S. export shipments could slip below USDA projections.

Corn export shipments have pretty much matched USDA expectations since the start of the marketing year. During the summer months, they dipped slightly due to limited demand out of China.

The new marketing year for wheat has just gotten under way at the start of June and out-of-thegate shipments are running above USDA projections. Demand for U.S. wheat has been strong throughout the summer months, as fresh business has been coming in every few weeks. However, the trade is uneasy that demand will not hold through the fall months. It is likely some of the business will be shifted toward international competitors, as international crops are expected to be strong this year.

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Corn Strategy

ü2012 cr op: T he cor n market appears to be stabilizing, but we are still increasingly less confident of seeing any significant r e b o u n d i n c a s h p r i c e s.

With the southern har vest beginning, prices could quickly gravitate to new crop levels. With that in mind, u s e s tren g th f o r ca tch -u p sales. ü2013 crop: It appears as if the recent USDA report was enough to ease the downward decline, but we feel there will likely not be any significant rallies to the upside. However, frost could cut output, but not enough to significantly tighten supp l i e s. Wa i t f o r r a l l i e s t o $4.71 on December futures before considering catch-up sales. vFundamentals: USDA lowered forecasts for the size of this year’s corn harvest to 13.8 billion bushels, from 13.95 billion last month. In addition, the report trimmed projected yields to 154.4 bushels an acre, from 156.5 last month.

Cents per bu.

Soybean Strategy

ü2012 crop: Despite the slight recovery bounce in the nearby contract, we still do not see any reason to hold old crop soybeans, as harvest is nearing in the horizon. ü2 0 1 3 c r o p : T h e s o y bean market has turned f i r m o n f r i e n d l y U S DA numbers and a dry weather forecast. A November futures close above $12.45 opens the door for a test of the $12.70 region. Use rallies into that level to make catch-up sales. vF u n d a m e n t a l s : T h e trade was slightly taken off guard from the August USDA report, which pegged soybean harvest at 3.255 billion bushels, down 5 percent f r o m i t s e s t i m a t e i n Ju l y.

The current weather forecast for much of the Midwest is providing the market with some positive momentum.

The market is calling for below-average chances for rainfall. If this pattern would hold throughout

August, it would have the potential to affect soybean yield potential.

Wheat Strategy

ü2013 crop: Wheat price action has become choppy, but continues to slip to new seasonal lows. The first sign of a turn would be a close over $6.49 on Chicago September futures. Wait for a rebound over $6.70 on Chicago September futures to make catchup sales. vFundamentals: Market activity over the past month in wheat has been linked to the corn market. Until

r e c e n t l y, t h e c o r n m a r ke t was trending lower and simply pulling wheat along with it. The August USDA report was unable to provide any significant support, as wheat p r o d u c t i o n wa s p l a c e d a t 2.114 billion bushels, unchanged from its forecast a month earlier. The USDA did slightly boost its forecast for wheat exports by 2 percent to 1.1 billion bushels.

However, expor t competition is starting to increase, as U.S. prices are higher than some international competitors.

PERSPECTIVES

FarmWeek Page 16 Monday, August 19, 2013

N-Watch: Technology in today’s corn fields As farmers strive to optimize corn yields and expand productivity to meet the feed grain demands of a growing world population, they must remain vigilant regarding the surrounding environment and use of natural resources to make such improvements sustainable.

A new program launched by GROWMARK Inc. and the Illinois Council for Best Management Practices helps farmers HOWARD zero in on better manBROWN agement of applied nitrogen (N). The goal of this program is to improve the long-term profitability of farmers while minimizing the environmental effects of applied nitrogen by enhancing its efficient use by plants.

The program is called N-WATCH. It is a management tool designed to inventory, track and verify plant-avail-

USDA: Get your house in order

Editor: In Mr. Burrack’s column (July 22), he complains about delays in approving 2,4-D, and dicamba-tolerant crops by USDA. While the USDA might be violating its own rules for approval, it is in fact carrying out a far more important function of government generally known as the “precautionary principle.”

The principle implies there is a social responsibility to protect the public from exposure to harm when scientific investigation has found a plausible risk. If further scientific findings emerge that provide sound

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E d i t o r ’s n o t e : D a n G r a n t asked members on last week’s Marketers to Washington tour to describe the condition of their crops.

able N in the soil. It allows farmers to optimize nutrient utilization and know where within their soil profile the concentration of plant-available N exists in their fields. It is a tool that farmers can use to help make nitrogen management decisions.

Farmers can now watch the behavior

of plant-available N as a result of environmental changes.

For example, how much N is lost from early applications? Is there any residual N left that can be captured by planting a cover crop? These and other questions are being addressed by NWATCH. It is a management tool for farmers that shifts N management from an application to a systems approach, applying incremental amounts of the nutrient over time.

Farmers participating in the NWATCH program have gained a new understanding and appreciation for what happens to applied N from time of application to

LETTER TO THE EDITOR

evidence that no harm will result, then the protections can be relaxed.

Even though these herbicides have been around for a long time, the only use of 2,4D on food crops that I know of was as an ingredient in Agent Orange used to destroy rice fields in Vietnam and defoliate the jungle canopy. In case you are not aware, exposure to Agent Orange has caused a lot of health problems in our veterans who handled it and even more health problems in the Vietnamese people, including birth defects in the grandchildren of the people who were originally exposed.

By engineering resistance to 2,4-D and dicamba into corn,

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the stage of rapid corn growth. It supplements rather than replaces current university recommendations.

FarmWeekNow.com

Learn more about the N-WATCH program by visiting FarmWeekNow.com.

The essential part of N-WATCH is that it provides farmers with a new way to estimate and track plant-available N at a specific point in a field. And it has brought renewed attention to managing N using the 4R Approach — right source, right rate, right time and right place.

To learn more about the N-WATCH program, contact your local ag retailer or visit the Illinois Council for Best Management Practices online at {illinoiscbmp.org}.

Howard Brown is manager of agronomy services at GROWMARK, Inc.

soybeans, cotton, etc., you make a major change to these plants, thus creating a new organism that looks like the original, but is not the same at the cellular level. There is no way of knowing what will happen with this new organism without extensive studies for things such as allergic reactions, digestive disorders and epigenetic disorders in future generations.

How many weeds have become resistant to mechanical control i.e. the hoe, cultivator, mower? I believe the answer to this question is 0. Need I say more?

ROBERT SAYRE Dundas Editor’s Note: Illinois Farm Bureau and American Farm Bureau Federation support a science-based and technically rigorous approach that is employed in the U.S . gover nment’s lengthy and thorough process of approving new biotech traits. IFB recently wrote to USDA saying , “these traits have already gone through USDA’s rigorous regulator y review protocol and there have been no scientific findings to war rant additional Environmental Impact Statements.”

“I don’t think things are looking too bad in my area right now.”

“This year things were late and wet.

It’s the complete opposite of last year.”

“There is potential for a good crop with adequate rain.”

“The crops were affected by late rains and late replanting, but with today’s technology and a late frost, hopefully we’ll see good yields.”

Fred Meyer Tazewell/Fulton counties

Henry Kessler Henry County

Glenn Ginder Will County

Barbara Gard Clark County