Hog losses from PEDV will impact hog markets into 2015. Producers continue looking for ways to combat the disease..............3
They’re baaack! CropWatchers provide their first reports of the 2014 growing season while waiting for soils to dry and warm up......6-7
A two-year Illinois State University study indicates kernel placement could hold the key to higher corn yields..........................12
A service of
Budgeting battle begins
Illinois Farm Bureau mission: Improve the economic well-being of agriculture and enrich the quality of farm family life.
Monday, March 31, 2014
SIGN OF THE SEASON
®
Two sections Volume 42, No. 13
Quinn’s $65.9 billion proposal keeps income tax hike in place BY KAY SHIPMAN FarmWeek
Periodicals: Time Valued
Gov. Pat Quinn found the state’s fiscal glass half full when he proposed a $65.9 billion budget for fiscal year 2015. During last week’s budget speech, Quinn urged state legislators to make permanent the existing income tax and avoid making “extreme cuts” to education funding and public services. In return for extending the existing 5 percent personal income tax rate, the state would provide homeowners an annual $500 property tax refund for their owner-occupied residences, the governor said. Property tax relief alone would total an estimated $1.5 billion annually. Afterward, both Senate President John Cullerton, DChicago, and House Speaker Michael Madigan, D-Chicago, supported Quinn’s extension of the income tax rate, which is scheduled to roll back Jan. 1. Madigan added he demanded
“relief for homeowners.” Quinn also proposed $1.5 billion for his Birth to Five early childhood initiative, a $50 million increase in Monetary Award Program scholarships and increasing funding for elementary through high school education by $6 billion during the next five years. As proposed, the fiscal 2015 general state aid funding level for elementary and secondary education would be 91.5 percent, according to Ryan Croke, deputy chief of staff. The state’s financial situation has improved over the last five years as a “result of hard work” that included paying $5 billion in overdue bills and reducing spending by $5.7 billion, Quinn said. In media briefing materials, the spending cuts included a $68 million reduction by the Illinois Department of Agriculture (IDOA). Illinois Agriculture Director Bob Flider, who attended the briefing,
Blair Hoerbert, Logan County Farm Bureau president, drives past a posted weight limit sign on a county road last week. State law gives local road officials the authority to post roads for weight limits for any 90-day period for any weather-related reason. Not all roads are posted the same, so drivers need to pay attention to the weight limits and the ending dates. (Photo by Ken Kashian)
Register now for IFB farm bill webinars
If you haven’t already registered, sign up for three Illinois Farm Bureau webinars at {www.ilfb.org/farmbill} or {Far mWeek Now.com}. The first webinar begins at 8 a.m. Wednesday. Doug Yoder, IFB director of affiliate and risk management, will share information about
farm bill commodity title options. He’ll discuss crop insurance and the supplemental coverage option at 8 a.m. April 9. Jim Fraley, IFB livestock program director, will host an 8 a.m. April 17 webinar regarding farm bill dairy and livestock disaster provisions.
IFB against proposed Clean Water Act rule Please see Budget, page 4
BY DEANA STROISCH FarmWeek
A proposed rule released by the U.S. Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers last week expands their jurisdiction under the Clean Water Act “way beyond what Congress ever intended,” according to Illinois Farm Bureau. IFB and other agricultural groups are opposed to the 370-page rule, which has been in the works for years. EPA says the rule merely clarifies which wetlands and streams are “waters of the U.S.” The proposed rule states that under the Clean Water Act: • Most seasonal and rain-dependent
streams and wetlands that feed into those streams, as well as isolated wetlands or other waters that have a significant nexus to the traditional navigable waters,” she said. “It has a potentially huge impact on what people traditionally think of as the waters of the U.S.” EPA Administrator Gina McCarthy, in a pre-recorded video message, said Supreme Court rulings in 2001 and 2006 complicated implementation of the Clean Water Act. Determining which waters are federally protected has become “incredibly difficult,” she said. “To be clear: Our proposal does not
streams are protected. • Wetlands near rivers and streams are protected. • Other types of waters may be protected, if a case-specific analysis shows that they have a “significant nexus” — either alone or in combination with similarly situated “other waters” — to a traditional navigable water, interstate water or territorial seas. Lauren Lurkins, IFB’s director of natural and environmental resources, said the proposal could require farmers to go through the federal permitting process under the Clean Water Act more often. “Not only is it your seasonal and raindependent streams, it’s the adjacent
FarmWeek on the web: FarmWeekNow.com
Please see Water, page 4
Illinois Farm Bureau on the web: www.ilfb.org ®
Quick Takes
FarmWeek Page 2 Monday, March 31, 2014
WARNING ISSUED FOR MEXICAN-STYLE CHEESE — Illinois Department of Public Health has issued a warning about eating illegally manufactured cheese. Health officials have reported about 100 cases of Salmonella in 13 counties believed to be linked to consumption of an illegally manufactured Mexican-style cheese. Since July 2012, local health departments in Boone, Cook (including the city of Chicago), DuPage, Fayette, Kane, Lake, LaSalle, Macon, Marion, McHenry, Vermilion, Washington and Will counties have reported Salmonella cases possibly linked to the cheese. Many cases have reported consuming Mexican-style cheese obtained from work sites, including factories, and at train stations, from street vendors and from relatives and friends. The cheese is not labeled and is often wrapped in aluminum foil. IDPH encourages consumers to always purchase milk and dairy products made by licensed dairy manufacturers. Anyone with information about illegally manufactured cheese should contact their local health department. Without this information, it will not be possible to prevent further illnesses. HORSE AUCTION PLANNED — April 12 marks the 25th Salem4Youth Horse and Charity Auction. The charity auction begins at 8:30 a.m., while the horse auction gets under way at 1 p.m. at the Flanagan facility. Salem4Youth serves as a school and working farm for young men who have struggled with truancy, anger management, defiance or substance abuse problems. All auction proceeds support the ministry. Young men help raise crops and Arabian horses on the 100-acre farm. For more information about the auction, visit {salem4youth.com}. FOOD QUIZ LAUNCHED — In honor of National Agriculture Day last week, agrimarketing public relations firm MorganMyers created an 11-question food quiz. Questions include information about the number of fulltime farmers in the U.S. and how USDA defines “organic.” The quiz aims to increase awareness of information about food and the agriculture industry. Take the quiz and see how you score at {morgan myers.com/blog/food-iq-quiz/}.
CORN BELT DICTATES CORN YIELDS — Corn Belt farmers rule when it comes to achieving national abovetrend yields. A recent University of Illinois study shows corn yields must be above average for the majority of Corn Belt counties in order for the U.S. to achieve corn yields significantly above trend. The converse holds true, too. Last year, for example, counties in the eastern U.S. had corn yields above-trend yields while western Corn Belt counties had below-trend yields, resulting in a U.S. corn yield near trend. The study found the situation held true for 2004 through 2013. For exceptionally high and exceptionally low U.S. yields, large weather patterns must impact the Corn Belt with either good or poor growing conditions.
(ISSN0197-6680) Vol. 42 No. 13 March 31, 2014 Dedicated to improving the profitability of farming, and a higher quality of life for Illinois farmers. FarmWeek is produced by the Illinois Farm Bureau. FarmWeek is published each week, except the Mondays following Thanksgiving and Christmas, by the Illinois Agricultural Association, 1701 Towanda Avenue, P.O. Box 2901, Bloomington, IL 61701. Illinois Agricultural Association assumes no responsibility for statements by advertisers or for products or services advertised in FarmWeek. FarmWeek is published by the Illinois Agricultural Association for farm operator members. $3 from the individual membership fee of each of those members goes toward the production of FarmWeek. “Farm, Family, Food” is used under license of the Minnesota Farm Bureau Federation.
Address subscription and advertising questions to FarmWeek, P.O. Box 2901, Bloomington, IL 61702-2901. Periodicals postage paid at Bloomington, Illinois, and at an additional mailing office. POSTMASTER: Send change of address notices on Form 3579 to FarmWeek, P.O. Box 2901, Bloomington, IL 61702-2901. Farm Bureau members should send change of addresses to their local county Farm Bureau. © 2014 Illinois Agricultural Association
STAFF Editor Chris Anderson (canderson@ilfb.org) Legislative Affairs Editor Kay Shipman (kayship@ilfb.org) Agricultural Affairs Editor Deana Stroisch (dstroisch@ilfb.org) Senior Commodities Editor Daniel Grant (dgrant@ilfb.org) Editorial Assistant Margie Fraley (mfraley@ilfb.org) Business Production Manager Bob Standard (bstandard@ilfb.org) Advertising Sales Manager Richard Verdery (rverdery@ilfb.org) Classified sales coordinator Nan Fannin (nfannin@ilfb.org) Director of News and Communications Michael L. Orso Advertising Sales Representatives Hurst and Associates, Inc. P.O. Box 6011, Vernon Hills, IL 60061 1-800-397-8908 (advertising inquiries only) Gary White - Northern Illinois Doug McDaniel - Southern Illinois Editorial phone number: 309-557-2239 Classified advertising: 309-557-3155 Display advertising: 1-800-676-2353
LEADERSHIP
REACHING OUT
Erickson applying lessons to farm, IFB BY KAY SHIPMAN FarmWeek
David Erickson of Altona applies lessons he learned to his western Illinois farm and now to his new position as vice president of Illinois Farm Bureau. Anyone who started farming in the early ‘80s needed to apply knowledge and skills to survive. “Times were tight,” Erickson recalled. “We’re still focused on how we can be the most efficient. There’s no use spending a lot of extra money if it doesn’t provide a return.” Erickson and his wife, Nancy, appeared destined to farm. Erickson grew up on a Knox County grain and livestock farm that family members still operate. Nancy grew up in a farming family as well. After graduating from Western Illinois University, Erickson taught agriculture, first to high school students and later to those attending community college. After graduating from the University of Illinois, Nancy worked for the real estate investment department of a major insurance company. After returning to Illinois, she worked in her grandfather’s farm management business while also working with her family’s grain farm in Knox County. Erickson joined Nancy on her family’s farm a couple of years later. Farming practices and technology applied on Illinois Farm Bureau Vice President David Erickson adthe Ericksons’ farm served dual purposes. justs his GPS unit to prepare for spring field work. “In the late ‘80s, no-till not only saved soil, (Photos by Cyndi Cook) but there was fuel savings too,” Erickson noted. position taken by Illinois Farm Bureau they In ‘93, the Ericksons first used variable rate know it’s well reasoned, researched and thought applications based on a grid of soil samples out, and truly represents what Erickson made the old-fashwe hear from our members,” ioned way with a measuring he said. wheel and hand-measured Given farmers’ nature to grids. “When the (electronic) fix problems and have busitechnology came along, it nesses flourish, Erickson said seemed so much faster,” he he understands why Farm said with a chuckle. Bureau members sometimes “We stayed in a corn-soy become frustrated when govrotation because of benefits ernment problems, such as to our fields, and pest and disthe state funding situation, ease management. For us, it’s fester. Again, Farm Bureau worked,” he added. plays an important role to Lessons about benefits help members understand the also apply to Illinois Farm complexities of issues, he Bureau. added. “Organizations like Farm Erickson’s new Farm Bureau are so important in Bureau office reflects his farm members’ lives,” Erickson and his son’s eye for creative said. “We’re there every day, images. Adam Erickson’s phoproviding a constant reminder tos of farm scenes adorn the of the farmer’s voice by Illinois Farm Bureau walls and remind visitors of bringing it to discussions. Vice President David Erickson his father’s farm roots. “When legislators hear a
Correction
The names of Mason County Highway Department staffers Floyd Melvin and Gary Thomas appeared in incorrect order in a cutline in last week’s FarmWeek. Thomas is on the left and Melvin is on the right.
The Mahomet Aquifer provides about 53 million gallons of water daily for 120 public water systems and thousands of rural wells. U.S. Environmental Protection Agency Region 5 supplied incorrect information about the amount of water for a March 24 FarmWeek story.
Index shows farmers remain upbeat
The long winter, late start to spring and drop in crop prices challenged farmers in recent months. But most farmers remain upbeat heading into planting, according to the latest DTN/The Progressive Farmer Agriculture Confidence Index. Producers’ overall confidence in the survey was somewhat positive at 106.9, up from 105.5 in December and unchanged from a year ago.
A value of 100 is considered neutral. The index is a survey of 500 U.S. farmers. The most recent survey was conducted March 1-10. Farmers viewed present conditions as positive with a score of 128.1. But future expectations dropped to 92.8. Livestock producers had the most upbeat economic outlook with an all-time high score of 116.4. Crop producers’ confidence, meanwhile, dropped to a four-year low of 102.7.
SWINE
Page 3 Monday, March 31, 2014 FarmWeek
USDA swine report surprises trade; profits should continue BY DANIEL GRANT FarmWeek
USDA’s quarterly hogs and pigs report Friday surprised many traders as inventory numbers weren’t as low as expected. The U.S. inventory of all hogs and pigs on March 1 was pegged at 62.89 million head, down 3 percent from a year ago. Pre-report estimates predicted a 5.4 percent drop in swine inventory due to pig losses caused by the spread of porcine epidemic diarrhea virus (PEDV).
FarmWeekNow.com
Full details and analysts’ comments on the Hogs and Pigs report can be found at FarmWeekNow.com.
The breeding inventory, 5.85 million head, increased .3 percent compared to last year. Traders prior to the report predicted a decline in breeding inventory of .6 percent. And the number of market hogs (57 million head) declined 4 percent from last year. Analysts prior to the report projected the number of market hogs would drop 6 percent. “This report strongly suggests there are more hogs out there than some people anticipated,” John Nalivka, president
of Sterling Marketing, said during a teleconference hosted by the National Pork Board. The pig crop last quarter declined 2.8 percent compared to trade expectations of a 3.6 percent decline. The loss of pigs didn’t wipe out profitability for many producers, though, as hog prices raced to historic highs in recent months. Producer margins in February and March averaged more than $60 per head compared to a $30per-head loss during the same time last year, Nalivka noted. “On the one hand, we’ve got death losses from PEDV, but on the other hand we’ve got profitability,” he said. “The fact that farrowings are up is totally consistent with current profitability and expectations of future profits.” U.S. hog producers intend to farrow 2.88 million sows from March to May, up 2 percent from last year. Nalivka and Daniel Bluntzer, director of research at Frontier Risk Management, predicted lean hog prices could average anywhere from $110 to $128 per hundredweight in the second quarter and $108 to $124 in the third quarter before tailing off to $94 to
$102 by the fourth quarter. “We could have our lowest prices of the year in the fourth quarter,” said Jim Robb, director of the Livestock Marketing Information Center. “Seasonality could get exacerbated depending on how low slaughter numbers go.”
Hog slaughter so far this year declined about 6 percent, but pork production declined about 2 to 3 percent due to heavier animals. “If (PEDV) continues as bad as it appears to be, later this spring and into summer there simply may not be
enough hogs (for packers) to run at the capacity they’d like to,” Nalivka said. The trend of higher efficiency standards came to an end last quarter. USDA reported the number of pigs saved per litter declined from 10.08 last year to 9.53.
PEDV to cause shortfall of market hogs The spread of porcine epidemic diarrhea virus (PEDV) the past six months could impact pork production through 2015. Rabobank’s Food and Agribusiness Research and Advisory Team last week projected U.S. pork production this year could decline 6 to 7 percent due to massive piglet losses caused by the problematic virus. The virus, which originated in China, often kills up to 100 percent of suckling pigs less than three weeks of age. The impact of those losses will impact pork production by this summer, according to the Rabobank report. “We see the outbreak of PEDV causing a significant shortfall in the availability of market hogs in 2014 — to the tune of 12.5 million hogs or 11 percent of annual slaughter,” said William Sawyer, Rabobank analyst. “Given the rising number of PEDV cases reported coupled with a six-month average lifecycle, the months of August through October are likely to be the tightest for processors,” he continued. “Slaughter could decline by 15 to 25 percent against 2013 levels.” PEDV was identified in the U.S. last spring. The number of cases increased from less than 50 per week last summer and fall to 200 to 300 cases per week in the last three months. The number of cases in Illinois increased from less than 10 per week through November to 10 to 20 per week in December and January and up to 30 to 40 cases per week since mid-February. The virus thrives in cold weather, so many pork producers hope the spread of PEDV slows as the temperature warms up this spring.
But there’s no guarantee warmer temperatures will ease the situation, according to Liz Wagstrom, chief veterinarian with the National Pork Producers Council. “The hope is (warmer temperatures) will be helpful,” Wagstrom told FarmWeek. “In a previous experience with a related virus, warmer weather seemed to slow the spread. “That said, (PEDV) ran through Oklahoma last summer when it was very hot,” she continued. “So I’m not sure how much we can hang our hat (on a potential spring fix).” Wagstrom emphasized the fact that PEDV is not a threat to humans. “The consumer message is that this is an animal health issue and not a food safety issue,” she said. And consumers apparently embraced the message. “We’ve not lost consumer confidence,” Wagstrom added. “They’re still buying product.” U.S. pork exports in 2013 totaled 4.73 billion pounds valued at $6.05 billion. It marked the third consecutive year the value of U.S. pork exports exceeded $6 billion. — Daniel Grant
Pork producers use various methods to combat deadly virus No single management technique or preventive vaccine currently exists to stop the spread of porcine epidemic diarrhea virus (PEDV) in its tracks. Hog farmers, in response, have employed a multipronged approach in recent months to secure their farms from the virus and to treat herds during outbreaks. “Biosecurity still is the key,” said Liz Wagstrom, chief veterinarian with the National Pork Producers Council. “Know every input that comes in to your farm.” Hog farmers also should limit human contact with the herd; wear coveralls and boots at other sites or packing plants to prevent contamination in transport vehicles; wash and clean coveralls, boots and other equipment; clean and disinfect trailers after use; and
establish a clean and dirty zone for farm and transport workers to follow during load in and load out. If pigs on a farm exhibit signs of sickness, farmers should call a vet and obtain a quick and clear diagnosis, Bill Hollis, veterinarian with Carthage Veterinary Services, told FarmWeek. “Two things I’ve been telling producers is get a clear diagnosis quickly and respond to save as many pigs as possible,” Hollis said. The virus isn’t a threat to humans or food safety. But it causes diarrhea, vomiting and dehydration in hogs. It’s extremely deadly to baby pigs. Farmers thus far have had mixed results using antibiotics to combat the virus. An Iowa pharmaceutical firm recently developed a vaccine that could help the situation.
Participants show pigs at the 25th Annual World Pork Expo Junior National Show last summer in Des Moines. A record 856 juniors entered more than 2,500 pigs in the show. A pig industry expert said it’s too early to tell if the nationwide PEDV outbreak will affect the show circuit this year. The National Pork Board posted tips for commercial farmers and show pig producers to prevent and treat PEDV in their herds at the website {pork.org}. (Photo by Daniel Grant)
Kenneth and Carolyn Boester, hog farmers from Winchester, responded to an
outbreak on their farm by mixing activated charcoal into the drinking water of their sows and pigs. Activated charcoal absorbs toxins. It’s sometimes given to companion animals, such as dogs, to treat poison ingestion, according to Carolyn Boester, who worked for 13 years as a veterinary secretary. The Boesters took other precautions, such as the use of plastic boot protectors, hand washing and sanitizing, and limiting workers to one person per building to reduce cross-contamination on their farm. Another PEDV preventive measure farmers can try is feedback. Feedback involves feeding infected tissue or feces back to uninfected animals to make them sick and stimulate an immune response, according to authors of the CME
Group Daily Livestock Report. Immune sows then provide antibodies to subsequentlyborn baby pigs through the colostrum produced the first few days after birth. Looking ahead, Wagstrom said it is too early to tell what kind of impact PEDV could have on the show pig circuit in coming months. NPPC advised show pig producers to keep health papers in plastic bags, wear clean or disposable clothes and footwear at weigh in, wash and disinfect scales after weigh in and allow only owners to enter trailers and restrain their pigs. Other information about PEDV and tips for biosecurity and treatment of the disease for commercial farmers and show pig producers is available at NPPC’s website {pork.org}. — Daniel Grant
GOVERNMENT
FarmWeek Page 4 Monday, March 31, 2014
EPA proposing stricter rules for pesticides
tion for two years. • Expands mandatory posting of no-entry For the first time in two decades, the U.S. signs for certain hazEnvironmental Protection ardous pesticides. The Agency (EPA) has proposed signs would prohibit stricter rules governing entry into pesticide‘We will be focusing treated handling and application of fields until pesticides. residues decline to a on educating our According to EPA, the safe level. members about this Illinois Farm Bureau changes to the Agricultural Worker Protection Standard rule and also about policy supports would better protect agriin the Worker t h e e x e m p t i o n s “changes cultural workers and their Protection Standards so families from pesticide a p p l i c a bl e t o o u r posting of field exposure. entrances does not The proposed rule, which members.’ unduly alarm concontinues to exempt “family sumers about the use of farms,” calls for the followcertain crop protection — Lauren Lurkins products.” ing: Illinois Farm Bureau • Prohibits children The proposed rule under 16 from handling was published last pesticides. month to the Federal Register. The deadline • Requires farm worker training every to submit comments is June 17. year (instead of every five years) on topics Lauren Lurkins, IFB’s director of natural such as decontamination supplies and perand environmental resources, said IFB plans sonal protective equipment. to work with the American Farm Bureau • Establishes 25 to 100 foot, no-entry Federation to submit comments. buffer areas surrounding pesticide-treated “At this point, we’re still reviewing the fields. proposed rule,” Lurkins said. “We will be • Requires employers to keep records of focusing on educating our members about application-specific infor mation, far mthis rule and also about the exemptions worker training and early-entry notificaapplicable to our members.” BY DEANA STROISCH FarmWeek
Be aware of biennial renewal of USDOT number and form
Every motor carrier who has registered for a U.S. Department of Transportation (USDOT) number — including farmers — must revise his or her registration information with that agency at least once every two years — even if it’s not changed, according to Kevin Rund, Illinois Farm Bureau senior director of local government. “It’s a long-standing regulation that has seldom been strictly enforced. A few weeks ago on March 1, it was given some teeth in the form of a potential fine and a renewed enforcement effort,” Rund said. Rund noted some farmers received officialsounding notices reminding them of the requirement and spelling out draconian fines that could be imposed if they ignore the renewal. “If the notice sounds overly threatening, it’s likely not from any government agency,” he said. “Rather, it could be from a vendor who offers reg-
istration services for carriers and apparently trying to scare up some business.” An official notice will come directly from the federal agency about 30 days prior to
the renewal date, according to Rund. “But you don’t have to wait. You can easily check for yourself to determine when your renewal should be made,” he advised. An individual’s assigned month for renewal is deter-
mined by the last digit of his or her USDOT number. Rund explained the numeral 1 would designate January; 2, February; and so forth. A zero designates October. Individuals may then check the next-to-the-last digit in the USDOT number. That number signifies whether the renewal occurs in even- or oddnumbered years. “The vast majority of farmers is quite capable of doing this update themselves. There’s no need to use a paid service,” Rund said. He recommended farmers go online to the Federal Motor Carrier Safety Administration (FMCSA) website and file form MCS-150 available on that site. That is the same form used for the original registration. Visit {fmcsa.dot.gov/regis tration-licensing/print-forms/ print-forms.htm} Individuals may complete that form online, or may print it and mail or fax the completed form to FMCSA.
Health care and education consume the largest share of Gov. Pat Quinn’s proposed $65.9 billion budget based on extension of the temporary income tax. This shows appropriation of all funds, including general state revenue from state income taxes, sales taxes, other taxes and fees, federal money, and special and dedicated funding.
Budget Continued from page 1
told FarmWeek the reduction covered various cuts, including fewer employees. Under Quinn’s preferred budget, IDOA’s total budget would be $104 million, a 4.5 percent increase compared to the current fiscal year. IDOA also would gain 14 employees. Ag-related line items in the preferred budget include $1.75 million for agriculture education that provides incentives for top-ranked ag ed programs. This would be a $500,000 increase compared to the current fiscal year. Funding levels would be maintained for state-county Extension match funding, Soil and Water Conservation Districts, county fairs, implementation of the Livestock Management Facilities Act
Water
add to or expand the scope of waters historically protected under the Clean Water Act,” Continued from page 1
FarmWeekNow.com
Listen to Matt Kaye’s report on EPA’s proposal concerning waters of the U.S. at FarmWeekNow.com.
she said. “It clarifies which waters are protected and which waters are not. It cuts red tape. It gives certainty to business, and it clears the way for the Clean Water Act to do its job so future generations can continue to enjoy these precious places.”
and agriculture product inspections.
With, without tax extension Gov. Pat Quinn offered two fiscal year 2015 proposals. One permanently maintains current tax levels. The other adjusts to the phase-out of the temporary state income tax. • $38.575 billion general revenue fund if current tax levels continue; • $36.82 billion appropriation with tax extension; • $34.934 billion general revenue fund if temporary tax phases out; and • $34.6 billion appropriation if temporary tax phases out. Source: Governor’s Office of Management and Budget
The proposed rule retains the Clean Water Act exemptions for agriculture. But Lurkins said IFB disagrees with EPA’s assertion that it will have no effect on agriculture. Lurkins said IFB will work with the American Farm Bureau Federation to further analyze the proposal and the potential effect it could have on members. A 90-day comment period will begin once the rule is formally published in the Federal Register. IFB plans to comment on the proposed rule. IFB also will urge members of the Illinois Congressional delegation to ask EPA to “go back to the drawing board.”
FARM MANAGEMENT
Page 5 Monday, March 31, 2014 FarmWeek
Crop specialist advises farmers to be patient this spring snow and a deep freeze in the soil over the winter. Farmers could become anxious to begin “Soils froze deeper than normal this past fieldwork this week as the calendar flips to winter and stayed cold into March,” Nafziger April on Tuesday. said. But cold soils and sloppy conditions across The cold, wet soils prompted Nafziger to much of the state suggest otherwise, according prescribe a dose of patience to farmers itching to Emerson Nafziger, University of Illinois to pull their planters out of the shed. Extension crop systems specialist. “Mudding corn into wet or marginally wet “We hope that we’ve seen the last of but cool soil conditions in early April is the snow by now,” Nafziger noted in a almost always a bad idea with considerrecent issue of The Bulletin. “But both ably more potential to do harm than to air and soil temperatures remain below do good,” Nafziger said. “We simply average.” need to be ready to do fieldwork and Topsoil temperatures last week in the plant as soon as conditions permit.” state ranged from 31.9 degrees in northSome farmers last week managed to ern Illinois to 39.6 degrees in southern begin spring fertilizer applications. But Illinois (see graphic). Nafziger recommended delaying fertilizThe soil temperatures were similar to er applications and tillage in wet fields to the same time last year, but much colder Emerson Nafziger avoid soil compaction. than 2012 when the soil warmed up to 49.8 As for planting activity, planting in early degrees in northern Illinois and 57.9 degrees in April into good soil conditions is a sound pracsouthern Illinois by the third week of March. tice. But it rarely produces higher yields. Illinois farmers in 2012 planted 5 percent of “Planting in early April almost never prothe corn crop in March. duces yields higher than planting in late April,” Meanwhile, heavy rains last week, with Nafziger said. chances of additional moisture this week, For more information, visit the website added to messy conditions produced by heavy {http://bulletin.ipm.illinois.edu}.
BY DANIEL GRANT FarmWeek
Economists see trouble, but no bubble, in farmland market BY DANIEL GRANT FarmWeek
Farmers this year could feel an economic pinch due to lower commodity prices and historically high input costs. But farmland markets should hold their ground rather than collapse, according to ag economists this month at a farmland values conference hosted by the Illinois Society of Professional Farm Managers and Rural Appraisers (ISPFMRA). “Farmers will feel margin compression,” said Brent Gloy, Purdue University ag economist. “Input costs typically don’t adjust as quickly as commodity prices.” Tighter Brent Gloy margins could pressure farmland values and cash rental rates. The majority of Illinois farmland (68 percent) acquired last year was purchased by farmers. ISPFMRA in its annual farmland values and lease trend report this month estimated the value of excellent farmland declined 2 percent last year due to sharply lower crop prices. “We’re at a plateau (in the farmland market),” Gloy said. “And there might be a downward slope.” The market is not expected to crash, though. Farm debt remains low; USDA projected ag exports will set a new record this year; livestock prices raced to his-
toric highs in recent months; and interest rates are expected to remain low. “A correction (in farmland prices) is likely,” said Dale Aupperle of Heartland Ag Group in Forsyth. “But I don’t hear anyone talking about a bubble or a bust.” Farmland currently accounts for about 83 percent of U.S. farm assets valued at roughly $2.5 trillion, noted Bruce Sherrick, University of Illinois ag economist. “People keep saying we’re setting up (the farmland market) for a big drop like in the 1980s. But we’re a long way from the edge,” Sherrick said. “Farmland has been a good hedge against inflation. I think it will remain a solid investment.” The run up in farmland prices in the 1970s ended when the U.S. enacted a grain embargo against the former Soviet Union in 1980. The market in the 1980s also crashed due to a doubledigit spike in interest rates. “I don’t think (the current ‘golden era’) will end the same way as the 1970s,” Gloy said. “Will there be farms that go bankrupt in the next few years? Yes. It happens.” Well-managed farms that use risk management, though, should fare just fine, Gloy said. He urged farmers not to get overextended. About 100,000 farms were overextended (on debt compared to assets) in the 1980s when the crop and land markets went south and set the stage for the farm crisis.
Steven Johnson, farm and ag business management specialist at Iowa State University, pointed to recent layoffs at John Deere as a sign farmers tightened their spending Steven Johnson plans.
Deere indicated last November it expects a downturn in the large farm equipment market and subsequently placed 120 workers at its John Deere Harvester Works facility in East Moline on indefinite layoff that began today (March 31). “Will farmers take on new debt? I don’t think so,” Johnson said. “I think farm-
ers are pulling it in.” Aupperle noted there have been fewer bidders at farmland auctions in recent months and some sales struggled to achieve minimum price levels. Johnson encouraged farmers to learn to use a variety of crop marketing tools, know their costs and make shrewd input decisions to remain profitable.
Higher interest rates could slow farm economy
Interest rates in the U.S. could increase each of the next two years. The Federal Reserve Board met earlier this month and suggested a modest increase in rates could occur in 2015 and 2016. A forecast called for interest rates to increase from near zero this year to 1 percent by 2015 and up to 2 percent by 2016. “The changes aren’t going to be very dramatic,” said David Oppedahl, senior business economist for the Federal Reserve Bank of Chicago. Interest rates during the 1980s by comparison posted double-digit increases and were a key driver of the farm crisis at that time. The changes shouldn’t be as drastic this time around. But David Oppedahl higher rates could slow the farm economy. “Interest rates are really important (to farmland values),” said Brent Gloy, Purdue University ag economist. “If they go up a lot, it would be a big problem. But rates (in the near future) probably are not going through the roof.” The Fed signaled higher interest rates in the future in response to its expectations of economic growth. The unemployment rate since October 2009 decreased 3.3 percent from just above 10 percent to near 7 percent. “We’ve gained back close to 8 million jobs (since the peak of the Great Recession in 2008-09),” Oppedahl said. “But we’re still in a
job deficit (by about 700,000) compared to where we were in 2007.” Meanwhile, the gross domestic product grew an estimated 2.5 percent last year and could increase 2.7 percent this year and 3 percent in 2015, Oppedahl noted. “Slow growth (in the job market) is a key reason interest rates stayed so low (in recent years),” the economist said. Looking ahead, “there are a lot of positive signs in the economy leading us to growth prospects.” USDA projected farm exports this year could set a new record. But a significant drop in crop prices could reduce farm income and put the brakes on growth of farmland values. “Agriculture is facing additional volatility,” Oppedahl said. “Less pressure on fertilizer prices could help offset declines in corn and soybean prices.” Ag credit conditions in the Seventh Federal Reserve District based in Chicago deteriorated in the fourth quarter of 2013 compared to the previous year. The index of nonreal estate farm loan repayment rates dipped below 100 for the first time since 2010. Farmers also are expected to borrow more funds to plant this year’s crop. “Loan demand increased the last quarter,” Oppedahl said. “More operating loans are needed for this year. It’s a bit of a change from the last few years.” Ag interest rates also inched up the fourth quarter of 2013. — Daniel Grant
FarmWeek Page 6 Monday, March 31, 2014 Bernie Walsh, Durand, Winnebago County: My wife Deb and I live and farm in Winnebago County, about 2 miles from the Wisconsin state line. This will be my 10th year reporting on crop conditions. We grow corn, soybeans and some wheat, and I also sell seed. This will be the 131st consecutive year our family has planted a crop. I hope it warms up enough pretty soon so we can think about getting started with the spring fieldwork. It has been an especially long and cold winter. Here we are near the first of April with frost in the ground, so it’s a pretty sure bet this will be a late planting season. There is still a lot of fertilizer, especially anhydrous ammonia, to be applied because the weather late last fall didn’t allow us to get enough of that work done then. I hope I can report on some fieldwork soon. Pete Tekampe, Grayslake, Lake County: Welcome to CropWatchers 2014. It was drizzling in Lake County Friday morning after receiving about .4 of an inch of rain Thursday. We still have piles of snow left from the winter, but they are getting quite a bit smaller now. We still have frost in the ground. Couldn’t drive a fence post in the ground Wednesday afternoon. Temperatures were forecast in the mid-40s for a high Friday and only two days this week to reach 60 degrees. The rest of the week will be in the mid-40s for a high. That won’t hardly get rid of the snow piles. Hopefully, they are wrong and it will warm up a little faster. Leroy Getz, Savanna, Carroll County: The 2014 cropping season in northwestern Illinois consists of snow banks and ice cubes. The snow drifts that were as high as an elephant’s eye have melted down but not yet gone. Frozen ground and frozen water pipes are still being reported. I have seen some dry fertilizer being spread, but there are also a few small fields of corn yet to be harvested. I welcome everyone to read and follow along as this spring weather starts to warm up. Ryan Frieders, Waterman, DeKalb County: Hello from Waterman in DeKalb County. After surviving a winter like my Grandma recalls from her childhood, I know we are all ready for it to warm up. Work on the farm continues in order for equipment to be ready when we need it. Some dry fertilizer was spread on frozen ground and some manure has been spread by neighbors in the past week. I have seen the first flower bulbs emerge, so spring must slowly be coming. I look forward to sharing more with you this year. Larry
Hummel,
Dixon, Lee County: The 2014 CropWatcher season has begun, but it doesn’t feel like winter is ready to give up yet. A nice warm up was in the weekend forecast, but we will cool down again with highs in the 40s forecast for the next two weeks. To top things off, there are quite a few chances for rain and snow. Spring will get here soon enough, and when it does, look out. Winter’s early arrival left a lot of fall work undone. There are a small number of cornfields still waiting for a combine to show up. I hope and pray that everyone has a safe and profitable year in 2014.
Ken Reinhardt, Seaton, Mercer County: We received around .2 of an inch of rain Thursday. The tile outlets I have checked are not running. Much of the winter’s precipitation ran off frozen ground. We have had the coldest six months in 35 years. It was a good winter for some. The local ski area had its second best season ever. It was nice to groom snow without the normal freeze and thaws of a typical Illinois winter. Jacob Streitmatter, Princeville, Peoria County: Planters are covered in dust, but not from planting. Almost being April 1, there is still frost in the ground. My shed doors just unfroze so I can finally get in. We are weeks away from even thinking about fieldwork. There will be little recreational tillage before it’s time to put the hammer down.
Ron Moore, Roseville, Warren County: Greetings from western Illinois. The winter here was brutal. Lots of record cold temps and the second highest snowfall on record. We still have some frost about 2 feet down in some places in the fields. We did get the feedlots cleaned last week when it was still frozen. We are not so patiently waiting for warmer weather to arrive. All of our equipment is ready to go and seed corn will be delivered next week. There is no green grass yet, so my cattle may have to wait for May to eat new grass. Let’s hope for some normal spring weather. Mark Kerber, Chatsworth, Livingston County: Welcome to another year of CropWatchers. We are starting these reports a little early this year in anticipation of warmer weather. So far, that hasn’t happened. What a winter it has been. March hasn’t been any better. Snow and spring rains are recharging the soil water tables. Tiles are starting to run as it is plenty early to get prepared for spring work. Markets could go either direction, depending on weather scares and summer weather. Be prepared to sell. Ron Haase, Gilman, Iroquois County: Hello again! I farm with my brother, David, on the western side of Iroquois County near LaHogue. We are the fourth generation of farmers in our family and the third generation at this location. We have been planting all corn on our farms. The last soybeans were planted in 2003. In 2014, we are planning to plant some soybeans and are trying to decide how many acres to plant versus corn. The cold weather has pushed back the chance of an early start to planting. Many seed dealers are still waiting to deliver seed out to the farmer. The years 2009, 2011 and 2013 were marked by a late start to planting, and this could be another one. We received .6 of an inch of rain Thursday. We are glad it is not snow this time. The local closing bids for March 27 were nearby corn, $4.66; new-crop corn, $4.52; nearby soybeans, $14.40; new-crop soybeans, $11.68.
Carrie Winkelmann, Tallula, Menard County: My name is Carrie Winkelmann and I have been crop watching now for three years in rural Menard County near Tallula. My wonderful husband, Kyle, and I have two lovely children, Lydia, 2, and Grady, 7 months. We farm with my father-in-law and I grew up on my dad’s farm in Farmersville. I am also the agriculture literacy coordinator for the Agricultural Literacy Partnership of Logan, Menard and Sangamon counties. I probably should have saved some of that to share for the weeks to come because I don’t think I am going to be reporting on very many crops for quite a while. We were busy hauling corn this week, getting deliveries of seed and chemicals, and applying fertilizer to the rye (that is greening up nicely). The planter and drill are in tip-top shape and ready to roll at a moment’s notice. The biggest problem will be making sure the monitors are working (“curse word” updates!!). We had a heavy dusting of snow Tuesday morning, and it was raining and blustery as I wrote this adding to the .3 inches of rain in the gauge from Thursday night. Wishing everyone a great growing season as I look forward to keeping you informed about my area and reading about the news from my fellow reporters across the state. Tom Ritter, Blue Mound, Macon County: Farmers are ready for the spring season to begin, but not as anxious as most years with the snow we had earlier in the week. The temperature is still very cool with very poor, cold soil temperatures. We got .2 of an inch of rain Wednesday, which was much needed. Hopefully, with more rain in the forecast, those showers will also add to the rainfall total. The biggest concern going into the season seems to be the lack of moisture. We had abundant snowfall and several good rains, but with the severe, cold winter, most of that moisture went to run off instead of soaking into the frozen ground. Tilers seem to indicate dry conditions 3 and 4 feet down. There has been little activity in the area. Only a couple reports of people doing a little bit of tillage. If we can gain temperature, farmers will venture out the first part of April. Most seem to be indicating it may be the middle of April before planting.
Brian Schaumburg, Chenoa, McLean County: The coldest March in memory soon draws to a close without much, if any, field activity. Seed deliveries are slow, too. Soil temperatures are still barely 40 degrees and the subsoil could use a recharging, soaking rain event. Prices at Prairie Central Coop: Corn, $4.73, fall, $4.62; soybeans, $14.29, fall, $11.58; wheat, $6.74.
Todd Easton, Charleston, Coles County: Welcome back to another exciting year of CropWatcher reports. I am glad to be back and reporting the Coles County crop year as it unfolds. After enduring the harsh winter of 2013-14, farmers are just getting winter tasks like grain hauling and receiving spring inputs caught up, and getting planters and other equipment ready to hopefully use within the next few weeks. A handful of fertilizer spreaders and maybe a couple of anhydrous applicators were able to do some work this week until we had .3 of an inch of rain Thursday morning. Multiple rain chances through the weekend and into the week along with consistent temperature dips look to give planters some time in the shed before we sow the seeds of the 2014 crop. Best thing to do right now is double-check the equipment and think spring!
Steve Ayers, Champaign, Champaign County: I was at a cover crop meeting in Hoopeston Thursday and a speaker said he had seen a Big R farm store marquee with the greeting “We’re so excited that spring is here that we wet our plants!” That pretty well sums up everyone’s relief to see some 60 degree temperatures after our loooong winter. We had .33 of an inch of rain Thursday complete with some sleet. The western half of Champaign County is still in the abnormally dry area on the drought monitor, but we do have more rain in the forecast this week. Some planters are emerging from machine sheds, but with a saturated soil and 36 degree soil temperature, not much will be happening in the fields. Let’s be careful out there!
Jimmy Ayers, New City, Sangamon County: Starting out the new year a little bit slow, and it has been cold all winter. The ground froze quite a bit deeper than it has in many years. I farm south of Rochester. We have 900 acres that is approximately 50/50 corn and beans. I custom farm another 600 acres. I have a truck or two on the road. My wife of 29 years and I have two kids. About 75 acres of ground that was just about right was worked Saturday (March 23) ahead of the freeze. It rained here on Thursday. A little bit of anhydrous to put on. Everyone is anxiously waiting and reassessing the new year. I appreciate the crop prices. Looking forward to providing a crop report from Sangamon County. Hoping you all have a great year and your plans are going well so far.
Wilfred Dittmer, Quincy, Adams County: Hello from western Illinois where the temperatures have certainly not caught up with the calendar. A little fieldwork has started nearby, but most equipment is still in the shed. Some have tried or started NH3 and some dry fertilizer, and that about sums it up. No planting that I am aware of at all, unless maybe some oats. Be careful as the new season begins.
Jeff Guilander, Jerseyville, Jersey County: We are off to another roaring start this year. Several farmers are trying to finish up anhydrous, but with nighttime temperatures in the 20s, it is not going very well. The ditches across the fields we had to cross last fall provide anybody with dirt moving equipment with more jobs than time allows. Looks like we are off to another year of surprises.
Page 7 Monday, March 31, 2014 FarmWeek Doug Uphoff, Shelbyville, Shelby County: I’m back for another year and looking forward to reporting the farming news in Shelby County. I now farm with my son, Elliott, and my dad, Duane. Elliott will be the fifth generation to farm with us. It is so awesome to have three generations farming together, as it was when my Grandpa Gib, Dad and I used to. Dad is retired, but as they say, a farmer never stops farming. He still keeps us going, and there is nothing like getting advice from someone who’s farmed longer than Elliott and me. Some anhydrous was put on last week. I actually chiseled some unworked ground that I put tile in last winter. The temperatures felt like last fall when we did fieldwork, if not colder. We could have planted if soils were warmer. The soil was fairly dry except low ponds and next to timber. I’m looking forward to a prosperous and safe new farming season. Every year’s different, and you only get so many chances to put a crop in, so I’m going to enjoy this one while it lasts. Dave Hankammer, Millstadt, St. Clair County: Welcome back to another growing season from St. Clair County. For those who will notice the updated photos of the CropWatchers, I’m not trying to set a new fashion trend for field wear. Staff photographers were given the task of getting our photo while we were in attendance at Governmental Affairs Conference, which explains the coat and tie. This spring season has started off with cold temperatures. Last week, we had low temps in the upper teens and highs near 50 degrees with a touch of snow. Farmers have returned to the fields preparing them for another crop. The wheat crop has greened up due to a few days of warm weather, and it shows promise of a good crop. Nitrogen has been applied to promote the growth of the crop. Farmers have been applying anhydrous in fields intended for this year’s corn crop, along with some spring tillage. The soil has been easily tilled due to freezing temps this past winter. Although there is moisture in the soil, the lack of rainfall is becoming a concern this early in the spring. Local grain bids are corn, $4.94; soybeans, $14.44; wheat, $7.24. Have a safe week.
Reports received Friday morning. Expanded crop and weather information available at FarmWeekNow.com
Kevin Raber, Browns, Wabash County: Fieldwork has been active the past week to 10 days. Rain Friday morning (March 28) may slow things down. NH3 application has been the main job for most of us. Soil has been dry, but is very cold! Wheat is off to a slow start. I’ve put part of my nitrogen on, but with cold temps, the wheat does not seem to be growing very quickly. David Schaal, St. Peter, Fayette County: Welcome again to the 2014 growing season from southeastern Fayette County. It has been a cold, snowy winter, and it is still on the cool side. On a positive note, there has been fieldwork accomplished. Wheat has been top-dressed and spring crop fertilizer is being laid down, along with anhydrous ammonia. Cool temperatures have kept fieldwork to a minimum. The Wednesday morning low was in the teens. Anhydrous ammonia was not even coming out of the tanks at the rate it is supposed to. Farmers are getting equipment ready to roll for when it warms up. Everyone be safe as you prepare for plant ing. Dan Meinhart, Montrose, Jasper County: Welcome to another season of CropWatchers. A very minimal amount of fieldwork has been done. Some fertilizer has been applied, some tillage took place, and some preplant herbicides have been applied. The temperatures have ranged from a low of 17 to a high in the 50s. It only snowed two days last week. Light rains began on Thursday. At present, we have an adequate amount of moisture. Soil temperatures are still very low. Temperatures should get up into the 60s this week with the lows being in the 30s. Have a good and safe week. Rick Corners, Centralia, Jefferson County: Jump in, lock the doors, fasten your seat belts and get ready for another ride through a growing season in southern Illinois. Wow, what a winter! And it won’t give up yet. It was 14 degrees Wednesday morning. Lots of anhydrous ammonia going on and corn already planted in the county. Kind of scary how dry it is already, but rain is on the radar. The verdict is still out on the wheat. What it really needs is a warm shower to get going. Some of it is pretty thin. P.S. I hear raindrops on the window.
Ken Kashian hian hi n Limited L Lim Limit m Ed E Edition dition di d itiiio on o n Pri P Print i
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Newest Print! / 5th in a Series, “Nap Time”
Dean Shields, Murphysboro, Jackson County: We are starting another year, and we don’t know what to expect. Is there going to be flooding, or a drought, or is it going to be good weather? We will have to wait and see. We are starting to do some fieldwork, and most of us are putting on anhydrous for corn. Some tillage work has been done. We seemed to have missed the rain that has been in most of the other parts of the county, so we are a little drier. Maybe it will be a dry spring. The winter wheat looks decent for what it has gone through. Glad to be with you all again for another year. Randy Anderson, Galatia, Saline County: Well, the calendar says first week of April, but feels more like the first week of March. Hello, from Saline County. As you already know, but for us folks down south, this has been one of the worst winters in a long time. Winter wheat is trying to break dormancy, but it is showing some winterkill. Finished top-dressing all my wheat this week hoping to get some extra tillering. There has been some fieldwork in spots. Most folks are just not in the spring fever mood. Did some dirt work around the house and walked out in the cornfield by the house, and guess what I found –- marestail. You know what that means! My feeling is that it came up last fall and lived through the winter. It has a leaf pattern as big as a saucer! Ken Taake, Ullin, Pulaski County: Welcome to another season of CropWatchers. Spring certainly seems to be slow arriving here in deep southern Illinois. I guess it’s just another example how every year is so different. It was in the mid- to low-20s overnight last week. Soils have finally dried enough that some field activity has started. The main activities are applying both dry fertilizer and anhydrous ammonia. As I called in this report Thursday night, it was raining. Our activities for Friday and through the weekend will be determined by how much it rained. People are getting awfully anxious for warm weather and to really get rolling this upcoming year. Please take time as we enter into this busy season.
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CLOSER LOOK
FarmWeek Page 8 Monday, March 31, 2014
Documentary provides ‘unvarnished’ look at farming
More than a year in the making, the U.S. Farmers & Ranchers Alliance (USFRA) privately premiered a new documentary last week in Washington, D.C., which follows the fortunes and misfortunes of six farmers and ranchers. Illinois Farm Bureau, along with beef, corn, dairy, pork and soybean organizations that comprise Illinois Farm Families®, has been working with USFRA to organize the Illinois premiere of “Farmland.” The AMC River East theaters, a multiplex in downtown Chicago, will host the documentary May 2-8 as well as theaters in Addison, Elgin, Gurnee and Orland Park. B&B Theaters in Festus, Mo., a suburb of St. Louis, also plans to show it in early May. USFRA, a national organization that includes Illinois Farm Bureau and the American Farm Bureau Federation as well as commodity and ag-related organizations and agribusinesses, financed “Farmland” in an effort to step up dialogue with consumers about today’s agriculture. James Moll, a filmmaker who has won Oscar and Emmy awards for previous documentaries, followed 20-something farmers and ranchers for a year, documenting weather challenges, financial decision making, family strife and why BY MIKE ORSO
they do what they do. The documentary features farmers from California, Colorado, Georgia, Minnesota, Nebraska, Pennsylvania and Texas. While Moll didn’t include any farmers from Illinois, Lee County farmer Katie Pratt, who serves as one of four USFRA Faces of Farming & Ranching, believes the “unvarnished look at what life is on a farm” will generate healthy discussion between farmers and consumers. “When I saw the film, I felt validated in a way,” said Pratt, who farms with her family near Dixon.
David Loberg, a fifth-generation farmer from Nebraska, stars in the new documentary, “Farmland.” The U.S. Farmers & Ranchers Alliance, which includes Illinois Farm Bureau, financed the film to increase dialogue with consumers about agriculture. (Photo courtesy of USFRA)
“I felt like, ‘Yes. That is it.’ They captured, on camera, what it is to be a farmer. I felt it validated what we do, our livelihood, the profession we have chosen.”
Highlights of the movie can be viewed at {farmlandfilm.com}. Theaters interested in showing “Farmland” should complete the “Contact” form on the film’s website.
Illinois soybean growers fighting world hunger Illinois soybean growers have raised nearly $7,300 through the American Soybean Association’s World Soy Foundation (WSF) Acre Challenge Campaign. The accomplishment ranks second only to Iowa, where soybean growers have raised $13,200 since October. The Acre Challenge, a fundraising campaign started by farmers, provides a way to help alleviate hunger and malnutrition around the world by donating the value of an acre of soybeans. The campaign begins Oct. 1 and runs for a full year. Soybeans produced on one
acre can be used to make more than 43,000 servings of soymilk — enough to feed more than 100 children every day for an entire year. So far this year, more than 285 donors from 30 states have accepted the challenge and donated an acre to the WSF. Soybean growers can continue donating by calculating the value of an acre of soybeans — yield multiplied by price. Make a donation by visiting {worldsoyfoundation.org}, or send a check to World Soy Foundation, 12125 Woodcrest Executive Drive, Suite 100, St. Louis, Mo. 63141.
Farmers may find expanded lending opportunities under the new farm bill. Loan program changes provide greater flexibility in determining eligibility, higher loan limits and added programs for beginning and socially disadvantaged producers. Changes taking effective immediately include: • Elimination of loan term limits for guaranteed operating loans. • Modification of the definition of beginning farmer, using the average farm size for the county as a qualifier instead of median farm size. • Modification of the Joint Financing Direct Farm Owner-
ship Interest Rate to 2 percent less than regular Direct Farm Ownership rate, with a floor of 2.5 percent. Previously, the rate was established at 5 percent. • Increase of the maximum loan amount for Direct Farm Ownership down payments from $225,000 to $300,000. • Increase of the guarantee amount on conservation loans from 75 to 80 percent and 90 percent, respectively, for socially disadvantaged borrowers and beginning farmers. • Microloans will not count toward loan term limits for veterans and beginning farmers. For more information, visit {fsa.usda.gov/FSA}.
Farm bill expands loans
Page 9 Monday, March 31, 2014 FarmWeek
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FarmWeek Page 10 Monday, March 31, 2014
Annual ryegrass, cereal rye not the same despite name BY KAY SHIPMAN FarmWeek
Despite their names, important differences exist between the cover crops annual ryegrass and cereal rye. Knowing those differences helps farmers choose the best applications and improve their profitability, according to Dan Towery of Ag Conservation Solutions, Lafayette, Ind. Towery noted annual ryegrass is a cool-season grass, while cereal rye’s growth characteristics are similar to those of wheat. Annual ryegrass seed costs slightly less than cereal rye, is much smaller and weighs 26 pounds per bushel. Cereal rye seed looks more like wheat and weighs 56 pounds per bushel. Farmers should seed annual ryegrass at a rate of 12 to 15 pounds per acre for drilling or 20 to 25 pounds per acre for aerial seeding. The cereal rye seeding rate is 50 to 65 pounds per acre. Cereal rye doesn’t like wet growing conditions while annual ryegrass thrives in those conditions, according to Towery.
Both annual ryegrass and cereal rye build soil, reduce runoff and erosion, scavenge nitrogen, improve water infiltration and increase organic matter. Farmers find annual ryegrass establishes easily in the fall with adequate moisture. For best results, annual ryegrass needs to be planted earlier than cereal rye. For example, central Illinois farmers need to plant annual ryegrass by Sept. 15. In comparison, they may plant cereal rye as late as Nov. 10, according to Towery. Cold bothers annual ryegrass more. It is more susceptible to winterkill resulting from a lack of snow cover combined with wind chills of minus 20 to minus 30, or late planting and many freeze-and-thaw cycles. Cereal rye survives well in winter even under extreme conditions. Cereal rye grows rapidly in ideal spring conditions of warm temperatures and plenty of moisture. It grows as high as 6 to 7 feet. Annual ryegrass grows as tall as 3 feet, but farmers typically burn it down when plants
Comparing cereal rye seed with annual ryegrass seed shows differences between the two cover crops. (Photos by Russ Higgins, University of Illinois Extension Northern Illinois Agronomy Research Center)
reach 6 to 15 inches in height. Annual ryegrass has a relatively low carbon-to-nitrogen ratio of 17 to 1, which means much of the nitrogen is released about eight to 10 weeks later or at the time of maximum nitrogen uptake by corn, Towery said. In comparison, cereal rye’s
carbon-nitrogen ratio increases as the plant matures and reaches 72 to 1 in the straw stems, he noted. Farmers who plant no-till corn into cereal rye typically burn it down before the cereal rye grows 12 to 14 inches to minimize nitrogen tie-up. Towery pointed out cereal rye produces much more biomass than annual ryegrass in the spring. Annual ryegrass has finer roots than cereal rye and breaks up compacted soil because its roots grow deeper into the soil profile. Corn and soybean roots then follow those old root channels if the soil hasn’t been tilled, he added. Annual ryegrass offers farmers more flexibility. With less biomass compared to cereal rye, annual ryegrass doesn’t consume as much soil moisture, Towery said. Cereal rye can dry
out the soil if left to grow during a dry spring. Farmers find annual ryegrass more challenging to burn down compared to cereal rye during cool weather when glyphosate doesn’t translocate as well, Towery added. He offered cereal rye as a good option for no-till soybeans. Cereal rye can be planted later, such as after corn harvest. If planted later, fewer problems surface if cereal rye gets tall in the spring, Towery said. The additional biomass helps with weed control and nitrogen tieup isn’t a problem. Towery suggested annual ryegrass as a good choice ahead of corn. Less biomass exists to keep the soil cool and much of the nitrogen, which is scavenged, is released in time for the corn to use it, he said.
Illinois farmers, on average, spent $965 to grow an acre of corn last year, setting a new record, according to a report from the Illinois Farm Business Farm Management Association (FBFM). The report, also compiled by the University of Illinois department of agricultural and consumer economics, found Illinois soybean growers spent $697 to produce an acre of grain. The figure represents a 6 percent increase compared to 2012. The 5 percent jump in corn production costs occurred primarily due to a $20-per-acre increase in variable costs and a $14-per-acre boost in both land costs and other nonland costs. With the average corn yield at 192 bushels per acre, per bushel costs averaged $5.03. The figure represents the second-highest on record. Increases in variable, land and other nonland costs similar-
ly spurred soybean production increases. Soybean yields averaged 56 bushels per acre, resulting in a cost of $12.45 per bushel. The five-year average per-bushel cost is $11.24. Corn costs per acre averaged $1,033 in the northern section, $966 in the central section for farmland with “high” soil ratings, $951 in the central section for farmland with “low” soil ratings and $872 in the southern section. Soybean costs per acre were $727, $715, $673 and $631, respectively. Costs were lower in southern Illinois primarily because of lower land costs. The total of all economic costs per bushel in the different sections of the state ranged from $4.90 to $5.20 for corn and from $12.32 to $12.88 for soybeans. Variations in this cost were related to weather, yields and land quality. For more report details, visit {farmdoc.illinois.edu/man age/corn_soybeans_costs.pdf}.
Corn costs set new record
AROUND THE STATE
Page 11 Monday, March 31, 2014 FarmWeek
Estate plans focus of Women in Agriculture Conference
More than 200 women gathered for the 6th Annual Women in Agriculture Conference March 21 at Jumer’s Casino and Hotel, Rock Island. Ron Hanson, Neal E. Harlan professor of agribusiness at the University of Nebraska-Lincoln, discussed wills as an estate planning vehicle. Hanson also spoke to spouses and other family members at a pre-event March 20. Hanson addressed obstacles and fears every family faces when starting to discuss the future of their farm. “Farms can be replaced, families cannot,” Hanson said. He stressed the importance of having open dialogue about a farm’s BY AMELIA MARTENS
For the children
future and having a written plan on how it will be passed down to the next generation. Ryan Whitehouse, Illinois Farm Bureau associate director of national legislation and policy development, gave a brief update on the farm bill during the general session. Breakout session discussions included cow herd profitability by Denise Schwab, Iowa State University Extension and Outreach; marketing by Naomi Blohm and Cathy Ekstrand,
Stewart-Peterson; spring yard preparation by Craig Hignight, Wallace’s Garden Center; iPad discoveries by Erin Duffy, Black Hawk College; estate planning by Rick Morgan, COUNTRY Financial; Ron Hanson social advocacy by Carrie Mess, Dairy Carrie farm blogger; common misconceptions in animal agriculture by Jim Fraley, IFB livestock program director; and current environmental issues by Lauren Lurkins, IFB director of natural and environmental resources.
Bureau, Carroll, Fulton, Henry, Knox, Lee, Mercer, McDonough, Rock Island, Stark, Warren-Henderson and Whiteside County Farm Bureaus and Scott County Farm Bureau in Iowa organized the conference. Sponsors included River Valley Cooperative, John Deere & Co., River Gulf Grain Co., 1st Farm Credit Services, Gold Star FS/GROWMARK, COUNTRY Financial, Iowa State Extension and the University of Illinois Extension. Amelia Martens, immediate past Miss Illinois County Fair, serves as a marketing representative for John Deere Construction and Forestry in the Quad Cities.
Grundy County fundraiser raises $28,000
Grundy County fourth graders got a $14,000 boost last week, thanks to the 5th Grundy County Farm Bureau Foundation Drawdown. The fundraiser supports county Ag in the Classroom efforts that reach every fourth grader in the county through monthly, in-school programs. Farm Bureau members joined the Grundy County Friends of Extension to
conduct the fundraiser. Extension youth efforts also received about $14,000. The $28,000 total represents the most money raised at the event, which has been conducted for five years. To see more photos of the event, visit the Grundy County Facebook page at {www.facebook.com/GrundyCo.FarmBureau.32}.
Tom Tesdal, Grundy County Farm Bureau Foundation chairman, left, and Randy Seggebruch, Friends of Extension Committee, auction a toy tractor at the recent Grundy County Farm Bureau Foundation and Friends of Extension Drawdown. (Photo by Tasha Bunting, Grundy County Farm Bureau manager)
RESEARCH
FarmWeek Page 12 Monday, March 31, 2014
ISU shows kernel placement next frontier for yield bump BY KAY SHIPMAN FarmWeek
Squeezing extra bushels out of a field may depend upon strategically placing kernels, based on a two-year study at Illinois State University (ISU). “We had really neat results,” said Paul Walker, ISU agriculture professor emeritus. Walker studied kernel placement and its influence on yields at ISU’s research farm near Lexington. “Germ placement determines the orientation of leaves on the stalk,” he said. “The leaves come out into the row instead of hitting the next plant so they (the leaves) get more sunlight exposure.”
Walker studied kernel orientation with all the tips down compared to random seed placement that occurs with existing corn planters. In study trials, the kernels were planted with tips down and all the germ facing the same way. In some rows, the germ faced across the row, while in others the germ faced the row. “We think in the future there may be pressure on equipment manufacturers to orient seed (in planters). That may be the next step to increase yields,” Walker said. Based on ISU results, corn planted with kernel tips down out-yielded randomly planted kernels regardless of
germ orientation. The corn planted with germ facing across the row had higher yields compared to corn with germ facing the row, according to Walker. “Seed orientation also changed the oil, protein and carbohydrate content” compared to randomly oriented seed, Walker said. For each 1 percent increase in carbohydrate, oil decreased by .38 percent and protein decreased by .44 percent. The ISU study also examined seed orientation impact on silage production. Corn with germ facing across the row produced more dry matter both years compared to corn with germ facing the
Montgomery FB, legislator tour coal mine Recently, the Montgomery County Farm Bureau joined their adopted legislator, local lawmakers and several county board members for a coal mine tour and networking. Joining “adopted” state Sen. Tom Cullerton, D-Villa Park, were state Sen. Andy Manar, D-Bunker Hill, and Rep. Wayne Rosenthal, RLitchfield. BY CHRISTINA NOURIE
A representative of Patton Mining, left, answers questions from state Sen. Tom Cullerton, D-Villa Park, far right, during a recent tour of the Deer Run Mine in Hillsboro. Looking on are Montgomery County Farm Bureau Director Randy Singler and state Rep. Wayne Rosenthal, R-Litchfield. (Photo by Christina Nourie)
Protecting your field is our scout’s honor.
Cullerton had expressed interest in learning more about the state’s coal industry and touring a mine. County Farm Bureau leaders expanded the activity to include their local legislators and county board members. This provided an opportunity to discuss agricultural issues and coal mining with all the elected officials. After a legislative breakfast with the elected officials and several Farm Bureau members, the group attended a county board meeting. Each legislator was introduced. The lawmakers and county board interacted when 911 funding legislation came up for discussion. After the meeting, Manar, Rosenthal and the farmers gave Cullerton a walking tour of downtown Hillsboro and talked about rural, small town life. After lunch, the group toured the Deer Run Mine, a relatively new longwall mine located in Hillsboro. Deer Run
Mine is owned by Hillsboro Energy and operated by Patton Mining. The mine has produced coal since 2013 and has the potential to produce roughly 8 to 10 million tons annually when the mine is in full production. Cullerton and others on the tour found the experience to be extremely educational and a valuable opportunity to learn more about an industry vitally important to the Montgomery County area as well as the state. The tour marked Cullerton’s second visit to Montgomery County. Last fall, he toured several farms and agribusinesses and rode in a combine. The senator said he looks forward to making a return trip and to hosting his adopted farmers for a tour of his DuPage County district later this year.
Illinois Farm Bureau staff joined nearly 250 participants from across the Midwest who focused on community development during the recent 25th Annual Rural Community Economic Development Conference at the Marriott Pere Marquette in Peoria. The Illinois Institute for Rural Affairs hosted the conference in affiliation with the Governor’s Rural Affairs Council chaired by Lt. Gov. Sheila Simon and Rural Partners. IFB helped sponsor the conference. A number of the breakout sessions and conference speakers addressed programs and initiatives that are valuable to IFB rural members,
said Brenda Matherly, IFB assistant director of local government. Jim Crandall of the Nebraska Cooperative Development Center discussed how rural communities can use a cooperative model to create new businesses or save existing ones. Dan Seals, assistant director for the Illinois Department of Economic Opportunity, updated participants on the state’s economic efforts. Breakout sessions covered community leadership, building regional tourism based on local foods, developing a downtown strategy to attract businesses and visitors, and creating a long-term vision for economic development.
Christina Nourie serves as the Illinois Farm Bureau northeast legislative coordinator.
IFB participates in economic development conference
At FS, we’re focused on crop performance. Our certified crop specialists will identify environmental conditions, crop growth stage and plant development to make agronomically sound recommendationss for each of your fields. It’’ss our goal goa to maximize every acre you farm and protect the local environment nment so you’re ready for what’’ss next. ne
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row or randomly oriented seed, Walker said. However, seed orientation did not change the plant vegetative composition, he added. Walker noted decreased dead leaves per plant in rows of kernels planted with the tips down. That also increased the silage yield compared to randomly planted kernels. Both years, milk production based on per hectare of silage was greater among cows fed silage from rows of germ facing across the row. “You get more milk per acre because you had more tons per acre (of silage),” he explained.
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FROM THE COUNTIES
Page 13 Monday, March 31, 2014 FarmWeek
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HRISTIAN — Farm Bureau will co-sponsor a workshop to explore the 2014 farm bill at 6 p.m. Thursday at the University of Illinois Extension office in Taylorville. Jonathan Coppess, U of I, will highlight changes that will affect farmers in central Illinois. Call the Farm Bureau office at 824-2940 for reservations by Tuesday. LINTON — Farm Bureau will host a market outlook seminar at 7 p.m. Wednesday at the Farm Bureau office. Cory Winstead, GROWMARK, will speak. Cost is $5. Call the Farm Bureau office at 526-7235 for reservations by Tuesday. OOK — Farm Bureau will co-sponsor a horticulture workshop gardening on your balcony/make an herb planter from 9 a.m. to noon April 26 at the Farm Bureau office. Nancy Pollard, U of I
Extension, will speak. Cost is $20. Call the Farm Bureau office at 708-354-3276 for reservations by April 21. • Farm Bureau will host a Maywood Park behind-thescenes tour from 10 a.m to noon April 22 at the Maywood Racetrack in Melrose Park. Call the Farm Bureau office at 708354-3276 for reservations. • Farm Bureau will sponsor a workshop on preparing wills and trusts, and transferring nontitled property from 6:30 to 9 p.m. April 10 at Orland Park COUNTRY Financial. Thomas J. Olofsson, estate planning attorney, and Katherine Reuter, consumer and financial education consultant, will speak. Cost is free for members and $10 for nonmembers. Call the Farm Bureau office at 708-354-3276 by Wednesday for reservations. AMILTON — Farm Bureau will co-sponsor an on-the-road seminar at 9
Early registration open for FSA programs Farmers who plan to participate in Farm Service Agency (FSA) programs can register in advance by April 15. Producers can report farm records and business structure changes at local FSA Service Centers. Examples of updates or changes to report include: • New producers or producers who have not reported farm records to FSA. • Producers who have recently bought, sold or rented land. Reports of purchased or sold property should include a copy of the land deed. If land has been leased, documentation should be provided indicating the producer had/has control of the acreage. • Producers who have changed business structures, such as forming a partnership or a limited liability corpora-
tion, need to ensure these relationships and shares are properly recorded with FSA. Even family farms with records on file may want to ensure this is recorded accurately as it may impact payment limits. While any producer may report farm records and business structure changes, it is especially important for producers who suffered livestock, livestock grazing, honeybee, farm-raised fish or tree/vine losses for 2011-14, and may be eligible for assistance through one of four disaster programs. Enrollment for the disaster programs authorized by the 2014 farm bill, including the Livestock Indemnity Program and the Livestock Forage Disaster Program, will begin by April 15. For more information, visit the FSA website at {fsa.usda.gov/FSA/}.
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Tuesday: • “FARMWEEK: the Early Word” • Bryce Anderson, DTN • Jennifer Smith, Illinois Agricultural Association Foundation: Illinois Ag in the Classroom 5K run • Kevin Daughtery, IAITC: 2014 summer ag institutes • Steve Meyer, Paragon Economics: livestock update Wednesday: • Tim Schweizer, Illinois Department of Natural Resources • Sen. Tom Cullerton, D-Vil-
la Park: Adopt-a-Legislator program • Eldon Gould: Field Mom tour Thursday: • Illinois Beef Association • Lulu Rodriguez, University of Illinois: new director of Agricultural Communications Program • Frank Butterfield, Landmarks Illinois: 10 most endangered historic places Friday: • Sara Wyant, Agri-Pulse • Mike Doherty, Illinois Farm Bureau
To find a radio station near you that carries the RFD Radio Network®, go to FarmWeekNow.com, click on “Radio,” then click on “Affiliates.”
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a.m. Tuesday at the White County Farm Bureau office in Carmi. Kevin Rund, Illinois Farm Bureau, will speak. Call the Farm Bureau office at 6432347 to register by Monday. ARION — The Farm Bureau Marketing Committee will host a market outlook seminar at 6:30 p.m. Thursday at the Farm Bureau office. Kim Holsapple, South Central FS, and Darryl Hargrove, Farm Service Agency, will speak. Cost is $7.50. Call the Farm Bureau office at 548-2100 for reservations by Tuesday. ASSAC — Farm Bureau will co-sponsor an on-the-road seminar at 6 p.m. today at Shawnee Community College. Kevin Rund, IFB, will
speak. Call the Farm Bureau office at 524-5811 for reservations by Monday. ICHLAND — The Young Leader Committee will co-sponsor an agricultural spelling bee for middle school students at 6 p.m. Tuesday at the East Richland Middle School cafeteria. Visit {rich andcountyfarmbureau.com} or call the Farm Bureau office at 393-4116 for registration forms, word list or more information. AYNE — Farm Bureau will co-sponsor an on-the-road seminar at 9 a.m. Tuesday at the White County Farm Bureau office in Carmi. Kevin Rund, IFB, will speak. Call the Farm Bureau
office at 842-3342 to register by Monday. HITE — Farm Bureau will co-sponsor an on-the-road seminar at 9 a.m. Tuesday at the Farm Bureau office. Kevin Rund, IFB, will speak. Call the Farm Bureau office at 382-8512 to register by Monday. ILL — The Women’s Committee will sponsor a spring flower and plant sale. Order forms are available at the Farm Bureau office and are due by April 25. Orders may be picked up from 1 to 5 p.m. May 3. Proceeds will benefit the Phone Cards for Troops program. Call the Farm Bureau office at 727-4811 for more information.
The IAA Foundation is accepting registrations for the 4th Grow and Go 5K run and family event. On-site registration begins at 7:30 a.m. The Kids’ Dash starts at 8:30 a.m. and the 5K run begins at 9 a.m. May 10 on the grounds of Illinois Farm Bureau headquarters in Bloomington. The early registration deadline is May 1. Proceeds raised will benefit
Illinois Agriculture in the Classroom (IAITC) and the IAA Foundation’s efforts to provide free educational resources to teachers and help students make the connection between food, fiber, fuel and farming. The 5K registration fee is $20, but increases to $25 after May 1. Registered runners receive a Tshirt, water stops and a hot breakfast. The Kids’ Dash entry
fee is $5. Runners who raise funds for IAITC will earn free registration and may earn other rewards. Tickets for the open house and breakfast only are available for $7. For more information or to register, visit {iaafoundation. org}, email Jennifer Smith at jsmith@ilfb.org or call the IAA Foundation office at 309557-2230.
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PROFITABILITY
FarmWeek Page 14 Monday, March 31, 2014
U.S. Department of Energy sale to send a message? The U.S. Department of Energy (DOE) in midMarch announced a plan to “test-sale” 5 million barrels of sour crude from the U.S. Strategic Petroleum Reserve (SPR). You may be asking yourself what exactly is the SPR, so you can truly understand the implication of the sale. The SPR is an emergency fuel storage of oil maintained by the DOE. It is the largest emergency supply in the world with the capacity to hold up to 727 million barrels. Bridget Chinowth The current inventory as of March 7 totaled 696 million barrels. This approximately equals 36 days of oil at current daily U.S. consumption levels of 19.5 million barrels per day.
BY BRIDGET CHINOWTH
The United States started the petroleum reserve in 1975 after oil supplies were cut off during the 197374 oil embargoes to lessen the impact of future temporary supply distributions. The reserve is stored at four sites on the Gulf of Mexico. In addition, the reserve consists exclusively of crude petroleum, not a stockpile of refined petroleum fuels. The recent sale from the SPR surprised the industry, but was not something unheard of. The sale was designed to test the system infrastructure or more specifically its distribution system. It was scheduled to be delivered over a 30-day period April 1-30. The last time the SPR ran a similar test was August 1990 when 4 million barrels were released ahead of the attack on Iraq. In addition, other sales have transpired, such as in the summer of 2011 as part of a coordinated effort by the International Energy Agency partner countries
after the civil war in Libya shut in production there. Also, the department released SPR oil in 2005 after Hurricane Katrina caused extensive damage to logistics and refineries in the Gulf Coast. The amount of oil being released was only about 1 percent of the total oil in the SPR, so on a statistical basis it is not significant. Looking at it in other terms, the release equals about 25 percent of the crude used in the U.S. every day. While by all account the sale was simply a test of the systems infrastructure, there certainly was some speculation about the timing of sale, as some viewed it as a message to Russia. However, the sale did not have any impact on the current market environment. Bridget Chinowth serves as a GROWMARK energy analyst. Her email address is bchinowth@growmark.com.
Analysts predict large plantings despite slow start to season
Many analysts prior to the report projected acreage totals A slow start to planting this will expand from USDA’s Febyear shouldn’t affect the total ruary baseline estimates of 92 acreage seeded in the U.S. million acres of corn and a In fact, many analysts record 79.5 million acres of believe U.S. farmbeans, up 3.9 perers this year cent from a FarmWeekNow.com will plant more year ago. total crop Soybean Check FarmWeekNow.com for details acres, including and analysis on today’s Prospective planting estiPlantings report. a record mates were amount of soypegged at 83.2 beans, compared million acres by to last year. Allendale, Inc., 82.9 million acres USDA today (March 31) by Farm Futures and 81.2 million released its prospective plantacres by Informa Economics. ings report for corn and beans. “Right now, farmers plan to Coverage of the report can be go heavy on soybeans,” said found at {FarmWeekNow.com} Rich Nelson, director of and in next week’s issue of research at Allendale. “We FarmWeek. have issues (including frozen
soil) that could impact corn planting this year.” USDA in February pegged corn plantings at 92 million acres, down 3.5 percent from last year. But many analysts believe farmers will plant more corn than the February estimate but less than last year’s 95.4 million acres. Corn plantings this month were pegged at 92.1 million acres by Farm Futures, 92.3 million acres by Allendale and 93 million acres by Informa. “USDA (in February) actu-
ally suggested we’ll have a decline in acres (of the eight major crops, including corn and beans, in the U.S.), Nelson said. “That does not fit with what the trade feels. We have quite a mix of acreage available for planting.” USDA last month projected U.S. farmers will plant 279.8 million acres of all major crops this year, which would be down from 282.3 million acres last year and 287.2 million acres in 2012. However, farmers last year had about 7.5 million acres of
prevented plant crops that should be back in production this year along with more land out of the Conservation Reserve Program. “I think USDA is too low (with its planted acreage estimates),” said Steven Johnson, farm and ag business management specialist at Iowa State University. “Farmers aren’t going to leave anything fallow.” Johnson last week was not overly concerned with the cold temperatures and late start to fieldwork this spring compared to previous years (Illinois farmers in 2012 planted 5 percent of corn in March). Corn planting progressed last week in the southern U.S., while some farmers in the southern half of Illinois started fertilizer applications. Meanwhile, the Western Corn Belt is so dry farmers there should be planting as soon as the soil warms up. “Once the frost is out of the ground (in the Western Corn Belt), we’re going,” Johnson added.
Using high-powered DNAbased tools, a recent study at the University of Illinois identified soil microbes which negatively affect ragweed, providing new understanding soil/plant relationships. “Some microbes are famous for their ability to change the soil, such as the microbes associated with legumes. We knew about those bacteria” said Tony Yannarell, U of I microbial ecologist. “But now we have the ability to use high-power DNA fingerprinting tools to look at all of the microbes in the soil, beyond just the ones we’ve known about.” While it may seem logical to simply add anti-ragweed microbes to soil, Yannarell said that practice has not been successful in the past. However, an effective weed suppression strategy might be to use plants that are known to attract the microbes that are bad for ragweed, and in so doing, encourage the growth of a micro-
bial community that will kill it. The study involved trials at agricultural research facilities in Illinois, Michigan, Kansas, South Dakota and Oregon using local soils gathered on site. The experiment allowed Yannarell and his colleagues to observe how three generations of ragweed and sunflower interacted with the microbial community in the soil. Interestingly, the same rag-
weed-preferring microbe was not found across all five states. “The microbial communities are different in each of these states, and yet we found the same overall patterns in each state individually,” Yannarell said. Illinois, Oregon, Kansas and South Dakota (and in about 50 percent of the data from Michigan) each had local microbes that preferred ragweed and had a negative effect on its growth.
BY DANIEL GRANT FarmWeek
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): Weight Range Per Head Weighted Ave. Price 10-12 lbs. (formula) $37.50-$64.69 $49.46 40 lbs. (cash) $113.00-$138.00 $127.69 Recipts
This Week 64,850 *Eastern Corn Belt prices picked up at seller’s farm
Last Week 99,127
Eastern Corn Belt direct hogs (plant delivered) Carcass Live
(Prices $ per hundredweight) This week Prev. week Change $124.80 $119.35 $5.45 $92.35 $88.32 $4.03
USDA five-state area slaughter cattle price (Thursday’s price) Steers Heifers
This week $150.83 $152.00
Prev. week $150.10 $150.11
Change $0.73 $1.89
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 $178.55 $173.93 $4.62
Lamb prices Negotiated, wooled and shorn, 131-169 lbs. for 154.58-178.50 $/cwt. (wtd. ave. 164.42); 180-192 lbs. for 152-160 $/cwt. (wtd. ave. 155.52)
Export inspections (Million bushels) Week ending Soybeans Wheat Corn 3/20/2014 26.9 19.3 45.0 3/13/2014 34.9 18.2 38.5 Last year 18.6 20.8 17.8 Season total 1457.1 933.1 829.4 Previous season total 1192.6 766.5 412.7 USDA projected total 1495 1125 1450 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.
Plant, soil interaction provides weed control clues
Illinois receiving specialty crop grant
The Illinois Department of Agriculture (IDOA) will accept proposals for federal specialty crop grants through May 1. IDOA officials do not yet know the exact amount that will be available. The funds will come from the Specialty Crop Block Grant Program in the new farm bill. Previously, Illinois received about $600,000 annually and used the money for new markets for fresh, Illinois-grown produce. Interested individuals may find information about the program, including a list of past recipients and projects, by visiting {agr.state.il.us} and clicking the specialty crops logo or by contacting IDOA’s Delayne Reeves at 217-524-9129 or delayne.reeves@illinois.gov.
PROFITABILITY
Page 15 Monday, March 31, 2014 FarmWeek
CASH STRATEGIST
Soybean imports from Brazil?
Amid the focus on the pace of our soybean exports, and the resulting size of our March 1 soybean stocks, the situation in Brazil has been mostly ignored. But given how that situation is unfolding, it may be a case of “ignore at your own peril.” Since the beginning of the year, the trade has scrutinized our weekly reports for Chinese cancellations. Some have occurred, but not to the level we need to keep ending stocks from shrinking to uncomfortably tight levels. One of the reasons may have been tied to the “strong-armed” tactics our exporters took with Chinese buyers. About six weeks ago, talk circulated indicating our exporters wouldn’t let the Chinese out of their contracts, in part, because they had already booked shipping. Meanwhile, crush margins in China dropped to unprofitable levels, port stocks have become unduly burdensome and unloading delays have become extensive. The intransigence of our exporters and the Chinese domestic situation forced them to focus their attention on Brazil and Argentina.
Over the last two to three weeks, there have been numerous indications Chinese buyers were altering the shipping schedule from Brazil. Initially, there was talk the Chinese had resold 10 cargoes of soybeans to U.S. processors. Today, it’s rumored the number could be as many as 20 cargoes, 10 cargoes being equivalent to 20 million bushels. It’s rumored they have also requested shipping delays on another 20 to 30 cargoes. The 70-cent decline in the FOB basis (loaded on ship) at Paranagua, Brazil, over the last four to five weeks reflected this, substantiating the Chinese talk. Meanwhile, Brazil’s harvest is winding down and product is flowing to ports. They are on schedule to ship 6 to 6.5 million metric tons in March, nearly double the prior record. That’s a month ahead of last year. The spread between Brazilian and U.S. prices already makes it feasible to ship Brazilian soybeans to processors at our coast. If their FOB basis drops another 15 cents, it should cover the cost of shipping to some interior processors, too. As a result, imports could be raised 10 to 15 million bushels on the next USDA supply/demand report, and could end up 20 to 25 million above the current forecast.
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Corn Strategy
ü2013 crop: Corn futures continue to hold key shortterm support, keeping the door open for another push to a new high. Still, one cannot build a strong positive story at this time with this year’s oldcrop ending stocks. Use strength to make catch-up sales. Check the Hotline after today’s USDA stocks report. We could add to them at any time, especially with cycles set to bottom in late May. ü2014 crop: Leave orders to price another 10 percent if December futures hit $4.95, boosting new-crop sales to 35 percent. vFundamentals: In the short term, USDA reports will guide market direction. Even though planting will not start early this year, the trade doesn’t seem too anxious. Last year’s demonstration of the ability to plant a lot of acres in a week’s time has undermined that concern for now. Export sales continue strong, remaining a positive force for prices. ûFail-safe: If December futures close below $4.78, get new-crop sales to 35 percent.
Cents per bu.
Soybean Strategy
ü2013 crop: While we can’t rule out a bullish report reaction, the decline in cash prices in Brazil relative to the U.S. indicates it may not be long lasting if one occurs. We do not recommend owning inventory. ü2014 crop: Use strength to get sales to recommendation. November futures continue to fall as they near $12, reinforcing its strength as resistance. vFundamentals: The report talk dominated the trade last week, especially the expectation for tight stocks. But as we have outlined in the main article, Chinese cancellations/re-sales of Brazilian contracts made it economically feasible, or nearly so, for the U.S. to import soybeans from Brazil. Longer term, it’s important to acknowledge continued Chinese economic problems could undermine protein demand longer term. ûFail-safe: Make sure newcrop sales are at recommended
levels if November futures close below $11.73.
Wheat Strategy
ü2013 crop: Price the rest of old-crop wheat if May Chicago futures push through $7.25. We will watch for the pace of committed export shipments as a guide for the remaining life of the nearby contract.
ü2014 crop: News has been relatively quiet, but there should be concern that Russian troops are steadily building on Ukraine’s eastern border. Political turmoil remains present within the country as well,
with protesters continuing to disrupt business in Kiev. Sales should be at recommended levels (up to 40 percent) if May futures close below $6.87. vFundamentals: After the market digests today’s USDA numbers, we will resume trading on weather and news involving Russia and Ukraine. Speculators were likely watching the former early Friday, but pared a bullish position with light rain falling over Kansas and Oklahoma. ûFail-safe: Use a stop order at $6.87 to price any remaining old-crop bushels.
PERSPECTIVES
FarmWeek Page 16 Monday, March 31, 2014
Markets, prices reflect current global tensions
John Deere’s data principles: Value, control, transparency
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n the last 20 years, how we capture data about inputs, practices and outcomes has changed significantly. As with other evolving technologies, concerns over the potential impacts are raising questions from nearly every segment in the production cycle. Healthy skepticism and caution are appropriate ingredients for a thorough vetting of new technologies. Because having your trust is so important to us, we welcome the opportunity to hear and understand your concerns, and to assure you we’re handling your data according to your wishes. Frankly, the industry is still discovering new uses and approaches for data and has lots of questions around data. So it’s hard to have all the answers in place before the industry even knows what all the questions are. Some may DON think they’ve pretty well figured BORGMAN it out, but our experience clearly indicates it will be years before the industry understands the full potential, identifies possible pitfalls and develops the right answers. That doesn’t stop us from establishing clear principles under which to operate or pledging to take the time necessary to ensure your needs and concerns are met. We know that it’s better business to take the time to retain your trust and to establish the right safeguards than it is to rush in to try to corner the market. That’s why there are three things we want you to know about how we view your data: • Value — The data you provide has value to your bottom line and if you choose to share it, we believe you can do your job better and we know we can, too. • Control — You are in control of the data that’s collected and who it is shared with. • Transparency — We want you to understand what we do, why we do it and what it means to you. You may wonder why we say “control” versus “own” when we talk about data. It seems simple on the surface — farmers own their data. But defining ownership isn’t so easy. What if the farmer is a share tenant, and the
equipment and software is owned by a custom applicator who spreads fertilizer for the local fertilizer dealer? And in that situation, who owns the machine data — the hours worked, fuel consumed and location history? Does the machine data belong to the farmer when he’s not the landowner or the machine owner? Does the farmer share ownership with his landlord who’s paying for half the fertilizer? Does the fertilizer dealer or the custom applicator have any ownership rights? That’s why we talk about who controls the data, meaning who gets to use the data and decide how it gets used. It’s much simpler to determine who should control the data than who owns the data in all situations. We think there can be value for you with the decision-making tools available through MyJohnDeere and the data you collect. And there is also value for us in that we can use that information to be proactive about machine issues, develop solutions for future products and get a better understanding of how you use our products. It’s a mutually beneficial relationship, which is always our goal. We believe you should control your data. That is why we created MyJohnDeere, so that you can. And you can change those choices anytime by logging into your MyJohnDeere account. It’s natural for people to have concerns about their privacy and a big company having access to their information. But our three principles are promises. You control the data. We will be transparent with our actions. And while everyone is still sorting out the value of the data, we trust that the market will get it right. After all, you have choices, and you won’t choose John Deere unless we provide each other an appropriate exchange of value. Together, we’ll answer the right questions, discover the most appropriate solutions and put into place the most effective safeguards. How do we know? Because your trust is more important to us than your data. Don Borgman serves as the director of agricultural industry relations for John Deere’s North American operations, and grows corn and soybeans on his farm in west-central Missouri.
The Cold War between the U.S. and the former Soviet Union unofficially ended in 1991. However, the chilling events, particularly the Russian occupation of Crimea, which unfolded in Ukraine over the last few weeks remind us there still exists a significant difference in political ideology between the United States and othDEREK er Western VOGLER governments compared to some of the Eastern Bloc countries — notably Russia. After ousting their former Russia-supported president, Ukraine became a center of controversy and is attracting attention from all over the world. The significance of this dispute remains unknown, but the impact on other countries and markets has begun to increase due to the higher prices of agricultural and precious metal commodities. Continued tensions will surely begin to be reflected in both oil and natural gas. As the world’s largest producer of oil, and one of the region’s largest producers of natural gas, Russia has the ability to impact the entire global economy through changes in its exports. As the U.S. and other Western governments are crying foul for Russia interfering in Crimea, Putin and his advisors began the war of words and claim any sanctions or other negative actions would be met with defaults on debt due to Western banks. They warned they could stop the flow of gas to the region if pushed. It’s too early to tell how much of this is just posturing versus a serious threat, but the bottom line is that the conflict could escalate unless calmer heads prevail. Interestingly, the equity markets in the U.S. and much of the world haven’t seemed to care much about these geopolitical issues, at least so far. Other than the Russian RTS Index, which has declined about 7 percent since the beginning of March, equity prices around the world have been relatively steady throughout the crisis. Many have recently hit multiyear highs. Either investors believe Putin and the other Russian officials are just thumping their chests or they believe the issue will fade away. The other
possibility is investors have become so accustomed to support by central bankers that they believe any negative events will push the Federal Reserve and its counterparts into action with more stimulus and massive injections of liquidity if any significant issues arise. While Ukraine grabs headlines, investors also have clamored for more jobs data to either confirm the slowdown in the U.S. economy or confirm the pace of the Fed tapering program. February’s report provided some answers — at least temporarily. The monthly data showed an increase of 175,000 jobs, much higher than the expected 149,000. In addition, the December and January figures were revised up by a total of 25,000 jobs. While 175,000 isn’t quite as high as the 183,000 average of 2013, it does provide some hope that a higher pace can be sustained as we move past this extraordinarily rough winter. The number also solidifies the current policy of the Fed, which is to reduce the monetary stimulus each month and be finished before the end of the year. In fact, after these results were published, some economists began to believe the labor markets are tighter than the number implies and the correct policy would be to finish the quantitative easing and in addition, begin raising short-term rates sooner than expected next year. The argument is that the skilled labor force has a very low unemployment rate, and some of the long-term unemployed probably won’t return to the pool of available workers. While we continue to see a lack of inflation in the data, the fear on many minds is that once the remaining slack in the labor market disappears, higher starting salaries and larger raises will be the norm. This, in turn, would begin increasing the level of inflation above the 2 percent targeted by the Fed. It’s still too early to call this sort of change, but the fact that some are beginning to worry about it shows the precarious situation the Fed could find itself in after years of massive liquidity injections and easy money policy. Derek Vogler serves as vice president of investments with COUNTRY Financial.