The IllInoIS Department of Agriculture will be looking for a new skipper after this week, as long-time employee Tom Jennings steps down. .....................................3
oCTober IS cooperative month, and co-ops are looking for regulatory relief from troublesome environmental, tax, and business requirements. .............................5, 12
S TA T e l AW r e q U I r e S farmers to call JULIE before doing some farm-related projects, such as installing field tiles, building waterways, and setting fence posts. .......8
Monday, October 17, 2011
Two sections Volume 39, No. 42
U.S. back in trade game?
Free (trade) at last! Congress clears FTAs
BY MARTIN ROSS FarmWeek
Last week, Congress ratified key free trade agreements (FTAs) with South Korea, Colombia, and Panama, ostensibly putting the U.S. back in the trade game on what one Central Illinois soybean grower called a “more level playing field.” In a major bipartisan breakthrough, the Senate and then the House cleared the agreements following prolonged, pitched debate between the White House and lawmakers. The agreements call for immediate elimination or phased reduction of foreign import tariffs on a variety of U.S. goods, including corn, soybeans, wheat, beef, pork, and related products. According to Farm Bureau, the FTAs combined represent nearly $2.5 billion in new U.S. ag exports, and Illinois Farm Bureau President Philip Nelson called their passage “a step in the right direction, not only for agriculture, but for the entire economy.” The three FTAs offer “huge opportunities for Illinois ag and manufacturing as well as our service sector to find new mar-
kets and new customers,” according to Rep. Aaron Schock, a Peoria Republican member of House Ways and Means Committee. His committee moved the agreements for a full House vote following their long-awaited submission by President Obama earlier this month. The White House projects the three FTAs long-term could generate 250,000 new U.S. jobs — in Schock’s view, “exciting news given the tough economic times we’re in.” The agreements offer potential to add 9,000 American jobs with every billion dollars in increased exports, Nelson suggested. Because the FTAs require no federal spending, “free trade equals free jobs,” Schock said. He also sees FTA passage as a potential opening for other bipartisan and/or regional agreements such as the Trans-Pacific Partnership (TPP), a prospective coalition of major Asian and Western trade interests. “The United States took a time out from trade for about five or six years, and that’s hurt us economically,” he told FarmWeek. “This is a good first step in the right direction. The natural thing to do now is
Asia, India — the administration as well as the Ways and Means Committee will be looking at. By us doing nothing, we have cost our country not only jobs but also lost revenue.”
Schock noted the U.S. has lost roughly half its Colombian wheat market share to more aggressive countries since the See FTAs, page 4
DUSTY HARVEST
Mike Walden of rural McLean combined soybeans through the dust last week prior to rainfall Wednesday and Thursday. The rain was welcomed in many areas to settle the dust, which had led to several combine fires, and to add a little moisture to the beans (See story on page 7). Walden said his bean yields ranged from 55 to 65 bushels per acre with only 9 percent moisture. He reported corn harvest was 85 percent complete with yields of corn-on-corn of 120 to 130 bushels per acre and corn on soybean ground yielding 160 to 180 bushels per acre. (Photo by Ken Kashian)
USDA projects lower crop yields, prices BY DANIEL GRANT FarmWeek
Periodicals: Time Valued
to look at what the next new markets are. “We are nowhere near in a position yet to present a new trade agreement, but there are definitely areas of the world —
A number of farmers have reported soybean yields this year have been a pleasant surprise.
FarmWeekNow.com AgriVisor’s Dale Durchholz discusses the short-term outlook for wheat and corn prices at FarmWeekNow.com.
But either pre-harvest expectations were low or poor-yielding fields have outweighed the surprisingly good fields, based on the most recent crop production/yield forecast. USDA last week trimmed its
estimate for U.S. corn and soybean production by 1 percent compared to its September projections. U.S. production last week was pegged at 12.43 billion bushels for corn and 3.06 billion bushels (down 8 percent from last year) for soybeans. “The greater-than-expected bean yields didn’t show up in this report,” said Jerrod Kitt, director of research for the Linn Group, during a teleconference hosted by the CME Group. Nationwide, yields were projected to average 148.1 bushels per acre for corn, down 4.7 bushels from last year, and 41.5 bushels per acre for beans, down 2 bushels from a year ago.
FarmWeek on the web: FarmWeekNow.com
That U.S. corn yield would be the lowest since 2005, a year which featured a regional drought in parts of the Midwest, while the soybean yield would be the second-lowest since 2003.
In Illinois, USDA last week lowered average yields by 2 bushels per acre for each crop to current projections of 159 bushels for corn and 46 bushels for beans. See Crop, page 7
Illinois Farm Bureau®on the web: www.ilfb.org
FarmWeek Page 2 Monday, October 17, 2011
Quick Takes IFF FIELD MOMS VISIT FARMS — Chicago-area moms selected by Illinois Farm Families (IFF) experienced farming and farm life last Saturday on two farms. They toured Lynn Martz’s grain and cattle farm near Maple Park in DeKalb County and the Dale Drendel dairy farm at Hampshire in Kane County. Background of the moms and related infor mation is online at {www.watchusgrow.org}. IFF is a coalition of state ag groups. Ten women were selected to serve as field moms from online applicants. “I want to find out what kind of farms the food in my fridge is coming from,” said Pilar Clark, a Lisle field mom. “I want to meet the people on today’s farm and learn their values about food and their own families.” PRECISION REGULATION — The Federal Communications Commission (FCC) and the communications company LightSquared must complete comprehensive and rigorous testing on proposed technical fixes to ensure no interference exists between broadband communications and global positioning system (GPS) signals, the American Farm Bureau Federation (AFBF) told Congress. In January, the FCC gave LightSquared conditional approval to build tens of thousands of ground stations that would use radio waves on the so-called “L-Band,” which is adjacent to the spectrum used by ag and other GPS devices. “It is critical that costs for resolving this issue are not passed along to farmers and ranchers through higher GPS or equipment costs,” AFBF President Bob Stallman said. “LightSquared should cover the expense of all technical fixes related to the interference issue.” AFBF joined in a letter to the FCC regarding the issue also signed by the American Soybean Association, National Association of Wheat Growers, National Corn Growers Association, the National Council of Farmer Cooperatives, and other national commodity groups. Further, Bloomington-based GROWMARK is a member of a national Save Our GPS Coalition. CONSERVATION CUTS NUTRIENT LOSSES — A new USDA study shows that farmers using conservation are reducing nitrogen, phosphorous, and sediment losses that move from farm fields into the Great Lakes and related tributaries. “The Great Lakes Conservation Effects Assessment Project (CEAP) study confirms that good conservation planning and implementation have reduced loadings of sediment and nutrients to waterways throughout the region,” U.S. Agriculture Secretary Tom Vilsack said last week. The Natural Resources Conservation Service estimated conservation tillage and other conservation practices have cut in half the amount of sediment entering rivers and streams. The study covered nearly 174,000 square miles — the entire U.S. side of the Great Lakes Region, including nearly all of Michigan and parts of Illinois, Indiana, Minnesota, New York, Ohio, Pennsylvania, and Wisconsin.
(ISSN0197-6680) Vol. 39 No. 42
October 17, 2011
Dedicated to improving the profitability of farming, and a higher quality of life for Illinois farmers. FarmWeek is produced by the Illinois Farm Bureau. FarmWeek is published each week, except the Mondays following Thanksgiving and Christmas, by the Illinois Agricultural Association, 1701 Towanda Avenue, P.O. Box 2901, Bloomington, IL 61701. Illinois Agricultural Association assumes no responsibility for statements by advertisers or for products or services advertised in FarmWeek. FarmWeek is published by the Illinois Agricultural Association for farm operator members. $3 from the individual membership fee of each of those members go toward the production of FarmWeek.
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STAFF Editor Dave McClelland (dmcclelland@ilfb.org) Legislative Affairs Editor Kay Shipman (kayship@ilfb.org) Agricultural Affairs Editor Martin Ross (mross@ilfb.org) Senior Commodities Editor Daniel Grant (dgrant@ilfb.org) Editorial Assistant Linda Goltz (Lgoltz@ilfb.org) Business Production Manager Bob Standard (bstandard@ilfb.org) Advertising Sales Manager
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RESEARCH
High-speed Internet research is focusing on Illinois uses SIU team taking a rural approach
with TechNet, a national organization of high-tech chief executive officers. Data and research also set Inter net benchmarks and allow states to know when prog ress is made and how to measBY KAY SHIPMAN ure it, Hor rigan added. He praised the FarmWeek state’s effor ts on regional levels. Five university-based Inter net The souther nmost region of 24 counresearch projects are collecting Illinoisties is being studied by SIU ag riculture specific data to improve applications and researchers, said Jonathan Cape, SIU ser vices around the state. g raduate student. One team, based at Souther n Illinois The research project will cover broadUniversity (SIU), is focusing on the band’s potential for job creation, potential impact improved Inter net ser v- increased income, and increased sales ice could have in r ural areas. and cost efficiencies within the region. Lead researchers representing the five Researchers are planning to conduct projects repor ted last telephone, mail, and elecweek during an Illinois tronic sur veys to gather Broadband Research ‘ We h a d t o g a t h e r infor mation. Symposium at the UniSome of their quesdata to understand tions will ask about trainversity of Illinois, Champaign-Urbana. w h a t t h e s t a t e o f ing needs and potential Inter net research is broadband was and applications for an impor tant because it expanded broadband netits infrastructure.’ “lends credibility to your work. effor ts,” said John Hor riThe other research gan, who helped develop — John Horrigan projects are focusing on the Federal Communicaformer Federal Communications Champaign-Urbana Commission staffer tions Commission’s neighborhoods, low(FCC) national broadincome senior centers in band plan. 10 nor thwest counties, “We had to gather data five low-income Chicag o neighborhoods, to understand what the state of broadand a new project that will address band was and its infrastr ucture,” said future Inter net users and networks. Hor rigan, now research vice president
Page 3 Monday, October 17, 2011 FarmWeek
STaTe
From fairs to regulations, Jennings reflects on IDOA ties BY KAY SHIPMAN FarmWeek
This week Illinois Agriculture Director Tom Jennings is severing his bond with the Illinois Department of Agriculture (IDOA), an agency where he started working as a grain warehouse examiner in 1978 and became director in 2008. But Jennings’ connection to IDOA, especially the Illinois State Fair, began many years earlier as a Springfield youngster. “I sold sodies and frosty malts in the grandstand,” Jennings remembered with a chuckle. “You could make good money. You had to make enough to have bus fare home and to have a good time.” From a kid working on the fairgrounds to the director overseeing them, Jennings has seen IDOA and the agriculture industry undergo many changes, sometimes at neckbreak speed. “The whole evolution of the agriculture industry is remarkable — from seed technology to fertilizer technology to information transfer. It’s all state of the art,” Jennings said. As the industry and technology changed, so did IDOA and its programs. “You had to adapt whatever programs you
its market news service, an average of $50 less per head was received at livestock auctions, according to Jennings. “If you don’t have this market reporting in place, your producers will suffer on the cash level,” he said, adding that Illinois now has the nation’s best market news service. Jennings mused that working with people has been one of his favorite parts of being agriculture director. “There are a lot of genuine people who are vested in agriculture whether they are employees, the people we regulate, or the consumers ... I also like fast-paced stuff. I’m going Tom Jennings, standing left, retires Tuesday as Illinois director of agriculture. In 2010, Jennings brought back to miss all those challenges,” many former state ag directors, seated right, for Ag Day festivities at the Illinois State Fair. He had worked he said. “I learned something every with most of them at the Illinois Department of Agriculture. (FarmWeek file photo) day. If you don’t, you’re not trying hard — whether it’s do,” Jennings said. had to provide the core regula- Illinois citizens understand the some animal welfare (issue) or The director also pointed tory services and programs that full scope of IDOA programs some obscure fertilizer law, with pride to how IDOA has and services. impact taxpayers and conlivestock siting issue, or grain helped the state’s ag industry. “You have to look at the sumers on a daily basis,” he industry issue,” Jennings said. A recent financial assesswhole of the department to noted. Jennings said his plans gain a proper assessment of the ment showed a return of $535 “You need to adapt to after his official retirement in ag sales for every dollar of value it brings to consumers,” changes, which I think we do on Tuesday include working state resources invested, fairly well here, and try to fore- Jennings said. “I doubt if one around his Springfield farm. according to Jennings. “Those in 10 people appreciate what see changes in the terms of An interim director has not funding. Then realign resources happens here. Once consumers are real, measurable sales — been named, but Jennings not projections — of meats, figure out how we help them, to bring a prioritized focus to said he won’t stray far from grains, raw commodities, programs,” Jennings continued. they go, ‘Wow. Really?’ his childhood roots and will processed commodities, and “I’m most proud of the “That’s been a challenge, especontinue “having fun at the cially with a shrinking budget.” people who work here. They all breeding livestock,” he added. fair.” After another state dropped Another challenge is helping have a great pride in what they
State council learns efforts continue to map, connect broadband services Work continues across Illinois to expand high-speed Internet services and to map existing services and highlight gaps in service, members of the Illinois Broadband Deployment Council heard last week. “Illinois has been very successful in securing federal awards (for broadband) and also in securing private broadband investments,” said Ryan Ryan Croke Croke, a deputy chief of staff for Gov. Pat Quinn. The latest statewide survey and a map of broadband services and the speeds offered will be available next week, reported Drew Clark with the Partnership for a Connected Illinois (PCI). The map and other information about broadband efforts are posted online at {http://broadbandillinois.org}. PCI also is collecting individuals’ “stories” about
broadband uses or lack of broadband to better understand the broadband availability in specific locations, Clark added. “The public is beginning to understand the uses and importance of broadband and the need for higher (broadband service) speed,” Clark said. Regional broadband issues now are being overseen by seven new “E Teams” that joined three existing teams. E Teams are entities involved with regional projects. “We’ve focused on a virtual workforce and the potential impact (of broadband) on areas where unemployment is high,” said Brad Housewright, the southern region E Team coordinator who oversees the
20 southernmost counties. “We know we also have a shortage of tech employees,” Housewright continued. “There are several things that have to come behind the infrastructure ... in terms of training, jobs, and support.” Barbara Webster, the eastcentral region E-Team coordinator, has helped PCI verify broadband access in her area and surfaced demand for services, Clark noted. The council created three subcommittees and invited the public to provide input on issues related to the subcommittees’ work. Those subcommittees are: infrastructure and access; information and research; and adoption, use, and impact. — Kay Shipman
Migrant housing, services focus of state ag committee hearing Illinois Senate Agriculture and Conservation Committee members heard about dangerous housing and working conditions for migrant and seasonal workers during a committee hearing last week in the Capitol. Julie Pryde, administrator of the Champaign-Urbana Public Health District, described the living conditions she found in a northern Champaign County apartment complex. Snow could be seen through holes in the floor, apartments were without electricity or heat, and residents had frozen buckets of water, she said. “I was horrified by what I saw,” Pryde said, adding that a single case cost state and local governments hundreds of thousands of dollars to intercede. Pryde raised the specter of disease outbreaks by sharing with committee members that cases of cholera and typhoid fever have surfaced in her county. Representatives of the Illinois Migrant Council, the Illinois Migrant Legal Assistance Project, and the Latino Policy Forum also testified about working conditions, hiring and payment practices for migrant and seasonal workers, and regulatory oversight and requirements. Senate committee members discussed possible introduction of legislation next year to address some of the problems of worker housing and labor conditions but did not make specific recommendations. — Kay Shipman
Farmers can track field conditions through free online service Growers Edge, a technology-driven media company in the ag sector, recently launched a free weather service designed to help farmers pinpoint weather information specific to their field locations. The new service, My
Weather Report, provides farmers with daily and monthly rainfall amounts, growing degree days, and an hourly forecast for rain, wind, temperature, and cloud cover at specific field locations. My Weather Report also
includes a hail-tracking feature that notifies farmers if there is a probability of a hail event, if a hail storm occurred near their fields, and the average size of the hail. Weather data from each of the selected field locations are
sent every morning to each farmer-customer’s e-mail address. For more information, or to sign up for My Weather Report or other free features from Growers Edge, go to the website {www.growers-edge.com}.
FarmWeek Page 4 Monday, October 17, 2011
goverNmeNt
Farm bill options offer payment, budget tradeoffs BY MARTIN ROSS FarmWeek
Congress, farmers, and economists are sampling and comparing a growing alphabet soup of farm policy options flavored by federal budget pressures. Over the past few months, the push to arrive at long-term deficit reductions has given rise to the National Corn Growers Association’s proposed Agriculture Disaster Assistance Program (ADAP), a similar but more fiscally conservative Senate Aggregate Risk and Revenue Management (ARRM) plan, and the American Soybean Association’s
Ag’s deficit dollArs?
U.S. House and Senate Ag Committees Friday had reached a tentative agreement to submit $23 billion in cuts over 10 years to the 12-member deficit reduction “super committee.” Congress’ Joint Select Committee on Deficit Reduction must recommend a $1.2-trillion deficit reduction package by Thanksgiving. The recommendation will then face a straight up-or-down vote. “While the exact assumptions behind the $23 billion target are not yet public, we understand the agreement includes total elimination of direct payments and target prices, and a new revenue program that would provide shallow loss assistance,” said American Farm Bureau Federation’s Mary Kay Thatcher at farmWeek’s Friday deadline. “We do not believe any reductions will be required in the crop insurance program. Nutrition will be required to take a small reduction in funding,” she said. district trigger, while RMAF pro- ation (ICGA) President Jim poses commodity-specific revReed noted ADAP attempts to enue benchmarks for individual lock in existing funds for both FarmWeekNow.com farmers, based on historical ACRE and a portion of current L i s t e n t o G a r y S c h n i t k e y ’s yields and prices. direct payments, while ARRM comments about the ARRM ARRM and ADAP would would “capture” ACRE funds program and how it would “work a lot alike,” said Universiwhile offering increased deficit work at FarmWeekNow.com. ty of Illinois economist Gary savings — a projected $20 bilSchnitkey, who last week lion over 10 years. That’s largely Risk Management for America’s released a comparison of “why the ADAP numbers are a Farmers (RMAF) program. ARRM and the current farm little higher” in terms of payout All three take a revenue-based program {www.farmdocdaily.illi- frequency, Reed said. approach to producer protecnois.edu/2011/10/simulated_ar He nonetheless sees ARRM tions, building somewhat on the rm_payments_compar.html}. as “a great step in the right existing Average Crop Revenue ADAP likely would pay more direction” toward proactively Election (ACRE) program. Both frequently, but when ARRM protecting the farm safety net. ADAP and ARRM aim to tightpays (see accompanying chart), it “It embraces a lot of the en the safety net by moving from would provide higher maximum concepts and simplifications ACRE’s state-based yield paypayments, Schnitkey indicated. that were proposed in ADAP,” ment trigger to a crop reporting Illinois Corn Growers Associ- Reed told farmWeek. “It’s a really good starting place for the farm bill discussion.” ARRM would eliminate Beyond the Agriculture Disaster Assistance Program, the direct and countercyclical payAggregate Risk and Revenue Management plan, and the Risk ment programs, as well as the Management for America’s Farmers program, Congress is mulling now-expired Supplemental several other farm safety net proposals. • Sen. Dick Lugar’s (R-Ind.) Rural Economic Farm and Ranch Revenue (SURE) standing disSustainability and Hunger (REFRESH) Act would enable proaster assistance program.
Working with a net
ducers to protect against losses between 75 and 90 percent of expected crop revenue, with an option to buy supplemental revenue insurance. REFRESH would eliminate direct, countercyclical, and Average Crop Revenue Election (ACRE) payments, Supplemental Revenue (SURE) disaster assistance, and marketing loans. The plan also would halt sugar price protections, revamp dairy price supports, close nutrition program eligibility “loopholes,” and streamline conservation programs. Lugar claims REFRESH would cut spending by $40 billion over the next 10 years, but the American Farmland Trust challenges its proposal to consolidate five major conservation easement programs into two. • Sen. Kent Conrad’s (D-N.D.) Crop Revenue Guarantee Program takes a “whole-farm” approach, offering payments when total program crop revenue declines below a guarantee. Payment is 60 percent of the difference between guarantee and actual revenue, and the program price guarantee is the higher of a target price or a five-year average farm price disallowing high and low years. Disaster programs would be established for other commodities. The program would reduce direct payments by 50 percent and eliminate countercyclical payments, ACRE, and SURE. • Stacked Income Protection Plan (STAX), proposed by the National Cotton Council, would enable cotton growers to buy new add-on coverage under an areawide insurance product with a fixed minimum harvest price. Cotton producers would forego direct, countercyclical, and ACRE payments and SURE assistance, and the cotton marketing loan would be modified. • The Crop Risk Options Plan (CROP) from Rep. Randy Neugebauer (R-Texas), would enable producers to supplement existing farm coverage with areawide insurance. CROP would change actual production history yield from a 10-year average to a seven-year average, kicking out the high and low years. • The Farm Financial Safety Net, proposed by a private insurer, would eliminate direct and countercyclical payments, marketing loans, and SURE in favor of a market-based minimum harvest price (a five-year average of insurance projected prices times 80 percent) and 5 percent federally subsidized coverage in addition to farmer-purchased coverage. • The National Farmers Union’s Farmer-Owned Reserve (FOR) would boost commodity loan rates and acreage set-asides. Payments would be limited to crops placed under the FOR. The plan would eliminate direct and countercyclical payments and modify marketing loans.
Schnitkey notes three key differences between ADAP and ARRM: • ADAP offers 95 percent coverage of a crop reporting district’s designate revenue “benchmark.” ARRM would cover only 90 percent. Both ARRM and ADAP base guarantees on a fiveyear revenue average, kicking out high and low years. • ADAP specifies a 10 percent maximum payment on its revenue guarantee, ARRM a maximum 15 percent. “Here’s the tradeoff: ARRM coverage starts out 5 percent lower than ADAP, but it’s maximum payment will be a bit more,” Schnitkey said. • ARRM’s annual revenue guarantee can rise or fall by only 10 percent year-to-year, limiting protection in the event of extreme revenue volatility.
ADAP has no such limit. While ADAP and ARRM “aren’t that far apart,” Schnitkey suggests ASA’s proposal bears scrutiny. RMAF bases revenue protection on a farm-level rather than a crop reporting district or county-level yield trigger, ostensibly raising the federal cost of the program relative to ADAP or ARRM and making program administration “more difficult,” he said. Further, the program would protect against losses below 90 percent of the producer’s revenue benchmark, down to 75 percent of benchmark. “That program will cause disincentives to buy insurance,” Schnitkey said. “In almost all years, there isn’t an incentive to buy crop insurance above a 75 percent coverage level.”
Seen here is University of Illinois economist Gary Schnitkey’s comparison of simulated Aggregate Risk and Revenue Management (ARRM) payments and actual federal commodity program payments on a per-acre base 1995-2010 for an representative farm in McLean County that devotes two-thirds of its acres to corn and one-third to soybeans. ARRM payments here are averaged over corn and soybean production.
FTAs continued from page 1 Colombia FTA was drafted five years ago. Illinois Soybean Association President Matt Hughes blamed a nearly 60 percent drop in soybean sales largely on a new Canada-Colombia FTA, and sees last week’s congressional vote as key to “recapturing” that market share. Obama endorsed the particularly sensitive South Korea deal a year ago after reaching an accord over automotive trade. But the FTA stalled this summer amid largely partisan debate over linking approval to extension of Trade Adjustment Assistance (TAA) for workers purportedly displaced by trade or offshore job movement. Ways and Means Chairman Dave Camp (RMich.) and Senate Finance Chairman Max Baucus (D-Idaho) reached a compromise reducing the originally proposed cost of TAA extension by a third and directing a five-year program phase-out. Some controversy nonetheless remained: Highland Park Republican Sen. Mark Kirk voted for all three agreements, while Springfield Democrat Sen. Dick Durbin supported the South Korea and Panama FTAs but held back support of the Colombia’s pact because of his concerns over that country’s human rights record. The three FTAs call for elimination of tariffs, some immediately, on refined corn products such as sweeteners, oil, starches, and corn gluten feed and meal. Tariffs on all refined corn products eventually will be phased out under each agreement, national Corn Refiners Association President Audrae Erickson said. The deals with Colombia, Panama, and
South Korea, when fully implemented, will generate nearly $772 million in new pork sales, add more than $11 to the price producers receive for each hog marketed, and create more than 10,000 pork industry jobs, according to Iowa State University economist Dermot Hayes. The U.S. Meat Export Federation maintains the Colombia and Panama FTAs would add an estimated $35 million in beef exports and about $25 million in pork exports by 2016. The Colombia FTA immediately will eliminate tariffs, including 5-20 percent duties on soybeans, soy meal, and soy flour, and phase out the 24 percent tariffs for crude and refined soy oil over five years. The Korea FTA offers immediate duty-free access for U.S. beans for crushing and soy meal and opens South Korea’s food-grade soybean import market to private sector sellers. The Panama FTA immediately will remove tariffs on beans, meal, and crude soy oil. Most exports from Colombia already enter the U.S. duty-free. “These were agreements we reached more in terms of leveling the playing field for us,” ISA’s Hughes told farmWeek. “There’s a lot of negative press about free trade agreements, about how their benefits go the other way — the ‘sucking sound’ they talked about with NAFTA (the North American Free Trade Agreement). “We’ve already given these (new FTA) countries untethered access to the U.S. market. We’re just trying to level the playing field that gives us access into their markets. It’s really more for our benefit than theirs.”
Page 5 Monday, October 17, 2011 FarmWeek
markets
Co-ops face pending regulatory, tax challenges BY MARTIN ROSS FarmWeek
Ag cooperatives this fall are counting on cooperative movement in Washington to counter potentially troublesome environmental, tax, and business requirements. Perhaps most pressing and promising is Senate passage of House Resolution 872, the Reducing Regulatory Burdens Act, which is aimed at heading off duplicative new federal pesticide permits, said Chuck Spencer, GROWMARK’s director of government affairs. The U.S. Environmental Protection Agency (EPA) currently is set to kick in initial U.S. Clean
Water Act National Pollutant Discharge Elimination System (NPDES) permit requirements in November. That’s despite already existing producer compliance with pesticide labeling requirements mandated by the Federal Insecticide, Fungicide, and Rodenticide Act. Senate failure to take up 872 is “threatening our agricultural community with a new avalanche of red tape as soon as the end of this month,” said House Ag Committee member Randy Hultgren, a Winfield Republican. The congressman joined 19 colleagues in a letter urging Senate leaders to quickly consider the bill “to help create regulato-
New biofuels reports ‘promising’ for industry As the biofuels industry prepares for a potential watershed transition in federal support, Illinois Corn Growers Association (ICGA) President Jim Reed sees “very promising” indicators for the existing ethanol industry. That’s despite proposals by a pair of House Ag Committee members that purportedly would weaken the federal Renewable Fuels Standard (RFS2). The RFS2 requires use of 36 billion gallons of renewable fuels per year by 2022, including 15 billion gallons of “conventional” (corn-based) ethanol. A new National Academy of Sciences (NAS) report suggests that “absent major technological innovation or policy changes,” the RFS2 target of 16 billion gallons of advanced cellulosic biofuels use “is unlikely to be met in 2022.” The report maintains next-generation fuels can be cost-competitive with petroleum-based fuels only “in an economic environment characterized by high oil prices, technological breakthroughs, and a high implicit or actual carbon price” paid for biofuels greenhouse gas reductions. But NAS analysts were optimistic the existing corn ethanol industry would continue to meet RFS2 targets. They stressed rising corn prices blamed on biofuels demand have been due as well to global population growth and crop failures, high oil prices, a decline in value of the U.S. dollar, and commodity speculation. Congress is expected to allow the 45-cent-per-gallon ethanol blenders excise tax credit to expire Dec. 31. RFS2 and the effective renewable fuels credit “market” it creates are key incentives to sustain fuel industry ethanol demand in the absence of the longstanding tax credit. But livestock sector concerns about ethanol-bolstered feed prices have spurred former House Ag Committee Chairman Bob Goodlatte (R-Va.) and committee member Jim Costa (D-Calif.) to propose reducing or eliminating volumes of RFS2-required renewable fuels use based on corn stocks-to-use ratios. National Corn Growers Association President Garry Niemeyer, an Auburn grower, argued the Goodlatte-Costa measure “would put progress made by the ethanol industry in jeopardy.” A coalition of biofuels and grain groups argues that RFS2, is in fact, only “a minor contributor” to corn prices. “We are as concerned about the livestock industry as anyone — they’re our partners in the ag industry,” ICGA’s Reed told FarmWeek. “But we really think a proposed rollback of the RFS2 is the wrong way to go about things. “A lot of this is being done based on the speculative moves in the market over the summer that have driven prices much higher. Some of the more recent market fluctuations have shown that there will be buying opportunities for livestock producers at better price levels.” Biofuels groups cited a recent International Centre for Trade and Sustainable Development report indicating 2009/10 prices would have been the same had neither RFS2 nor the ethanol tax credit then existed. Further, Michigan State University scientists said “indirect land use change” related to biofuels production was minimal to nonexistent. Had ethanol growth significantly impacted land use patterns, they stated, global use of arable land would have risen, “natural” lands would have declined, grain shipments from the U.S. to other regions would have dropped, and cropland in other regions would have reflected changes in harvested areas for U.S. corn and soybeans. Reed argued a growing body of research essentially has “discredited” use of indirect land use theory as a means of downplaying the positive environmental impact of biofuels. — Martin Ross
ry certainty for a critical sector of our economy.” Duplicative regulation multiplies not only farm and agribusiness costs but federal spending, as well, Spencer suggested. EPA itself has estimated the annual cost of the permit program at $50.1 million for applicants and $1.7 million for federally “delegated authorities” in individual states. “While everybody’s focused on the deficit reduction commission, we could take action in the Senate and clarify that pesticide applicators do not need a Clean Water Act permit,” Spencer told FarmWeek. “These everyday practices already are being done by licensed professionals using restricted-use products. They
have very specific requirements on the product label, penalties associated with misuse and misapplication, and a complaint process that’s already on the books. We have a process that’s worked for more than 38 years, very reliably.” The regulatory relief measure was to be included in Senate Chinese currency reform legislation, but Senate leaders blocked addition of any unrelated amendments. Also crucial to GROWMARK and its customers is congressional repeal of forthcoming U.S. Internal Revenue Service Section 3402 tax withholding requirements. Beginning in 2012, local, state, and federal agencies must withhold an additional 3 percent of any payment over $10,000 for goods or services from a private contractor-vendor. That would affect not only co-op fuel or supply sales but also farm program/conservation payments, Spencer noted. While producers or businesses can file for a 3 percent corresponding credit on subsequent income taxes, “it’s going to create more paperwork, more (federal) track-
ing,” as well as reducing immediate income flow, he said. Reps. Wally Herger (R-Calif.) and Earl Blumenauer (D-Ore.) support legislation to repeal the withholding requirements. Last year’s financial reforms have sparked further concerns for agribusinesses. At issue is a requirement that members of designated contract markets “record all oral communications that lead to the execution of transactions in a commodity interest or cash commodity.” The proposal, which could apply broadly within the grain industry, has raised concerns that elevators could be required to record phone conversations with cash grain sellers as well as file e-mails or FAXes related to transactions. Spencer sees the federal Commodity Futures Trading Commission as open to “ensuring that country elevators and cooperatives remain as unencumbered as possible” in the new rules. “Cooperatives should not be pulled underneath the major financial institutions’ regulations for which the law was originally designed,” he said.
FarmWeek Page 6 Monday, October 17, 2011
CROPWATCHERS Bernie Walsh, Durand, Winnebago County: Harvest was going full-steam-ahead until some rain came in on Tuesday afternoon. We had more rain on Wednesday and Thursday totaling 1.75 inches, so now we need some dry weather. The soybeans are probably one-half to twothirds done in this area, but are too wet to combine now with the rain. Corn harvest will be on the front burner now. Yield reports continue to be very good in this area. Have a good and safe week. Pete Tekampe, Grayslake, Lake County: A very cool Friday morning in Lake County. We received 0.5 of an inch of rain Thursday, which stopped the combines. Beans are about half done and running in the low 40s. Not much corn has been picked. Most of the corn is still in the high 20s. It’s harvest season, so they are calling for rain the next seven days, but we have to be thankful for the past week of above average temperatures. Leroy Getz, Savanna, Carroll County: Harvest progressed on soybeans during the warm, dry days. Yields are running from 40 to 80 bushels per acre. Rain stopped everything on Wednesday with 1.3 inches total here at my farm. Corn combining is starting, with very little done to the northern part of the county and up in Jo Daviess County only about 1 percent is completed. Other areas where storm damage occurred this summer are being harvested. Progress is slow, with some one-way going. Yields are from 50 to 70 bushels below normal. Full-season varieties were hit the hardest. Dry conditions are needed to pick that corn up. Ryan Frieders, Waterman, DeKalb County: We had absolutely perfect harvest weather last week. Most of the soybeans were harvested without any rain delays. Yields were average to slightly above average. Corn harvest is back in full swing again. Wednesday night and Thursday we received 0.7 of an inch of rain which will keep us out of the field until ground conditions firm up. Larry Hummel, Dixon, Lee County: At least 80 percent of soybeans are now harvested in this area. Scattered showers on Wednesday shut harvest down for us, while plenty of combines were able to continue until Thursday when a larger widespread front caused a temporary delay to harvest. Yields continue to run above average and in line with last year’s yields. We haven’t picked any corn yet, but the stories I am being told are below-average yields but still respectable with moisture in the low to mid-20s. There have been a couple of combine fires in the area, so keep it clean and be safe. Ron Moore, Roseville, Warren County: We received 0.5 of an inch of rain last week. Some areas to the north received up to 1.5 inches. That delayed much of harvest until the sun came out on Thursday afternoon. Harvest is about 75 percent complete in this immediate area. Yields are still holding up well. We should finish soybean harvest this week and corn next week. Some tillage is going on and dry fertilizer is being applied. There is not any anhydrous being applied yet, because the ground temperature is still too warm. Tim Green, Wyoming, Stark County: We got a little corn picking done and a few beans got cut the first part of the week. Beans are probably 60 to 70 percent complete around here. Corn harvest is just getting a good start now as bean harvest is winding down. We had about 0.6 of an inch of rain on Wednesday, that slowed things down. I am hearing a lot of 17, 18, 19 percent moisture in the corn, so that will speed up everything. Bean crop was pretty good. Corn crop is bouncing around — I’m hearing all kinds of numbers. Have a safe harvest.
Ken Reinhardt, Seaton, Mercer County: About 1 inch of rain mid-week slowed things down a bit. There are some late Group III beans to be cut, otherwise soybean harvest is about over. The wind was predicted to gust to 40 mph Friday. That will not be so good on the remaining corn. Moisture has dropped to about 15 percent on the corn. Mark Kerber, Chatsworth, Livingston County: Most of the soybeans are done and corn harvest is in progress. Moisture on corn has dropped to more manageable levels. A welcome rain last week gave us a day to change oil and conduct business. It seems we were just as busy on a one-day rainout as we were when harvesting. Yields are high and low, depending on soil type and spotty summer showers. Keep up the safe harvest. Markets have rebounded. Ron Haase, Gilman, Iroquois County: We started harvesting corn on Oct. 7. Rain early on Oct. 13 brought a halt to field activities. We received 0.3 to 0.4 of an inch on our farms. Most harvest activity over the past week has been in soybean fields. Eighty percent or more of the soybeans in the area have been harvested. Corn harvest would be at 10 percent to 15 percent done in my area. Our harvest progress in corn would fall into that range as well. The moisture on our corn that we have harvested has ranged from 17.9 percent to 22.3 percent. The moisture in corn dropped 2 percent to 3 percent over the past week. Tillage has been done in some fields as the combine waited for the crops to dry down. The local closing bids for Thursday were: nearby corn, $6.28; $5.52 fall 2012 corn; nearby soybeans, $12.27; fall 2012 soybeans, $11.93. Steve Ayers, Champaign, Champaign County: Dust was flying everywhere as corn and soybean fields disappeared before rain showers fell Wednesday afternoon and off and on for the next 24 hours. Amount totaled 0.57 of an inch and temperatures cooled off into the 70s. I have never seen such dry soybeans and our moisture ranged from 6.8 percent to 9.4 percent. Many farmers are finishing harvest and are doing fieldwork, spreading lime and fertilizer, soil testing, and preparing equipment for storage. USDA has our crop reporting district at 34 percent corn harvested and 46 percent soybeans harvested. Let’s be careful out there! Wilfred Dittmer, Quincy, Adams County: Greetings from our little corner of the county where I can actually say we got some liquid precipitation last week. It measured 1.25 inches over three days, but every little bit certainly helps when it is so dry. As for harvest, there still is an occasional field of corn to be taken out and soybeans are probably near half done with hardly any machines running last week until late Thursday. Tillage is stirring up a lot of dust. There have been a few farm machinery accidents in the area recently, so do take time to be careful. The life you save just might be yours. Carrie Winkelmann, Tallula, Menard County: Well, there are definitely getting to be fewer and fewer crops to watch in Menard County! Some corn and soybeans are still standing, but the majority has been harvested. We finished with soybeans Oct. 89 and are still working on corn, but the end is in sight. Tom Ritter, Blue Mound, Macon County: Light showers on Wednesday and Thursday last week caused a momentary delay on harvest, more so on soybeans than corn. However, both corn and soybeans are in the last 10 percent of crop to be harvested. Things are winding down quickly and a lot of tillage has been done. A lot of fertilizer is being applied, as well as lime. Overall, yields were about 20 percent below average, but both corn and bean yields are all over the board, even within fields.
Todd Easton, Charleston, Coles County: It was another productive week for everyone in the area with the exception of a wet day last Thursday. Singleday rainouts are always a great opportunity to fix or correct equipment issues that tend to be put off while the sun is shining. It seems to me that most other producers must think the same way because parts and service dealers are always noticeably busier on those days. Several have wrapped up harvest operations and many more are on the verge of doing so. One more good week and standing crops will be almost a memory. In exchanges with producers and agronomists it is always interesting to discuss which management practices worked and which ones did not in a given year. The consensus I have received so far is that this year sidedress nitrogen, soybean fungicide, and workhorse hybrids were effective strategies while long-term corn-on-corn and lateplanted beans did not work so well. Every year seems to offer interesting observations and lessons that often will come in handy later on. All we have to do is figure out exactly what those are. Jimmy Ayers, Rochester, Sangamon County: The corn is about 98 percent done and the beans are close to 92 or 95 percent. There is very little crop left in the area. On Wednesday we received 0.6 of an inch of rain at our place. The western part of the county didn’t get nearly as much. There have been some fields being worked and some fertilizer going on. It was quite a treat in the market last week. Not sure how long that will last. Get a grip on what you have in your bins. These are still pretty good prices. David Schaal, St. Peter, Fayette County: Harvest has been progressing rapidly. Weather was warm and sunny until Wednesday afternoon when showers moved through. Rain continued on into Thursday morning, leaving a welcome 0.7 of an inch. Some producers are wrapping up with their corn. Some are done with beans and have several acres of corn to harvest. There is a small percentage of farmers who are completely done or about to wrap up. A little wheat has been sown in the area, but not a lot. Some fall fertilizer is being applied. Some fall tillage has started. Keep harvesting and be safe. Ted Kuebrich, Jerseyville, Jersey County: Jersey County received about 0.6 of an inch of rain Wednesday night and that put a stop to bean cutting on Thursday. On Friday, farmers were able to go back to harvesting beans and shelling corn. Some are putting on fertilizer and doing fall tillage. In addition, some are planting wheat and baling cornstalks into big bales to feed to livestock this winter. Prices at Jersey County Grain, Hardin: cash corn, $6.26; January 2012 corn, $6.31; cash beans, $12.36; January 2012 beans, $12.55. Dan Meinhart, Montrose, Jasper County: The first part of the week was clear and mild, and a lot of harvesting took place. Rains moved through the area Wednesday afternoon and lasted through Thursday, leaving 0.75 to 1.5 inches. The rains were welcome as conditions were very dry and dusty. The rain has decreased chances of field fires. Some wheat has been planted, and the rain will help it emerge. Yields are still running all over the board. Moisture on the early-June planted corn is still running in the 20s. We were expecting a dry and mild weekend with a slight chance of rain this week with cooler temperatures. Kevin Raber, Browns, Wabash County: Harvest progressed rapidly until Wednesday afternoon. Rainfall amounts of 1.5 to 2 inches locally have shut down harvest for a few days. I would guess harvest at one-half complete. Most of the wheat has been sown. It needed moisture, but not quite as much as we received.
Page 7 Monday, October 17, 2011 FarmWeek
CROPWATCHERS Dave Hankammer, Millstadt, St. Clair County: It was another busy week for farmers in the area having ideal weather for harvest and fieldwork except for one day of light spotty showers. Some areas received a few tenths of an inch of rain — enough to keep combines out of the fields and allowing farmers to do other things. Many of the first-crop soybeans planted prior to the rainy period in June have been harvested. Yields have been better than expected considering the growing conditions we experienced this season. Fields planted after the rainy period have yellow streaks and the late and double-crop beans have turned to a bright yellow. Wheat has been quickly planted behind the vacated soybean and some cornfields. Emergence of this newlyplanted crop is slow and spotty — testifying to the dry soil moisture levels. Late-planted and replanted corn is standing well and waiting to be harvested. Local grain bids are: corn, $6.27; soybeans, $12.28; wheat, $5.70. Have a safe week. Rick Corners, Centralia, Jefferson County: We had 0.8 of an inch of rain Wednesday. We have everything going on — corn shelling, bean cutting, and wheat sowing.
Dean Shields, Murphysboro, Jackson County: We had some light showers go through on Wednesday night. For the most part, it was a really nice week for harvesting, and things are moving right along with corn and soybean harvest. The biggest thing is people being aggravated with the low yields on corn and soybeans. Wheat planting is in full swing. I believe there will be more acres down in my area in Jackson County. I noticed a neighbor’s sunflowers look like they are starting to ripen, so maybe they will make it before the frost. We are continuing to harvest. Everyone take care and be safe. Ken Taake, Ullin, Pulaski County: We had another beautiful week for harvest here in deep Southern Illinois. They are starting to show a lot of open fields. We did have a few showers that moved through Wednesday afternoon and Thursday morning. We only received about 0.2 of an inch and were back in the fields by late Thursday afternoon. We finished harvesting our full-season soybeans. I am guessing the yields to average somewhere in the low 40s. Currently, we are back to shelling corn. We are about half done with corn harvest. Corn we currently are shelling is running about 15 to 16 percent moisture. A few people in the area have planted their wheat. Please take time and be careful during this busy season.
Randy Anderson, Galatia, Saline County: Harvest made good progress in the last two and a half weeks. We had virtually no rainfall. We are probably pushing in the envelope of about 70 percent complete on corn harvest and about 60 percent complete on bean harvest. On my farm, we are done sowing wheat. It went in well and had adequate moisture. The main situation we have run into are a lot of washes in the field from the significant rainfall we had earlier this spring and summer. I want to send a thank you out to all the congressmen and senators voting in favor of the free trade agreement. I was a part of the Panama-Colombia trip, and it is good to see that sometimes things are successful. Be careful out there and watch for deer. As crops are leaving, deer are becoming more prevalent and moving around. It’s that time of year, and they don’t make very good hood ornaments.
Reports received Friday morning. Expanded crop and weather information available at {www.farmweeknow.com}.
Warm, dry stretch promotes harvest activity, field fires BY DANIEL GRANT FarmWeek Harvest raced past the halfway point in Illinois last week as warm, dry conditions in late September and early October quickly dried crops and promoted field activity. Farmers in a two-week stretch from Sept. 26 to Oct. 11 harvested a whopping 46 percent of the soybean crop and 27 percent of corn statewide after getting off to a slow start. Harvest as of the first of last week was 49 percent complete for corn, 3 percent ahead of the five-year average, while 50 percent of soybeans were cut, 1 percent ahead of the average pace. It marked the first time this season harvest activity was ahead
of the average pace for both crops in the state. Soybean harvest two weeks ago was 15 percent behind the average. The majority of the corn crop as of the first of last week was in the bin in every region of the state except the northwest (where corn harvest was 24 percent complete), northeast (32 percent complete), and east (34 percent complete), the National Agricultural Statistics Service Illinois field office reported. The statewide average temperature the first week of this month, 63.7 degrees, was a toasty 6.6 degrees above normal. Topsoil moisture in the state a week ago was rated 58 percent short or very short, 41 percent adequate, and just 1 percent surplus.
Rain fell in many areas of the state during the middle of last week and temporarily delayed
some harvest activity. But it was a welcome sight for many farmers. “We needed this rain,” said
Matt Hughes, a McLean County farmer. “It was getting pretty dangerous out there.” A rash of combine and field fires has been reported around the state in recent weeks. “You had to watch yourself the whole time,” Hughes said. “It didn’t take much (to ignite a fire in the bone-dry conditions). If you had any spark from a combine or bearing go out and then get a wind on top of that, it could really set it (fire) off.” Farmers from Sept. 26 to Oct. 11 also planted 26 percent of the winter wheat crop. Meanwhile, 44 percent of sorghum was harvested as of the first of last week, 4 percent ahead of the average pace.
Wheat planting progresses; acres could expand Wheat planting got off to a slow start in some parts of Southern Illinois due to recent rains that delayed soybean harvest. But Steve Stallman, a farmer from Randolph County and president of the Illinois Wheat Association, believes wheat acres this year could match or even exceed what was planted in Illinois last fall. “Soybean harvest is running about a week late in my area,” Stallman told FarmWeek. “But there are lots of opportunities left to sow wheat. “Our (Hessian) fly-free date is Oct. 9, so Oct. 10 to 20 is the prime time to sow wheat around here,” he continued. “But you can plant up to Halloween and still be very successful growing wheat.” Illinois growers last fall planted 760,000 acres of wheat compared to a record-low 330,000 acres that were seeded after the wet, extended harvest season of 2009. Stallman predicted farmers this year at least will match wheat plantings of a year ago.
“The price (of wheat) is good, so I’m sure the intention is there to sow at least an equal amount as last year,” Stallman said. “Barring any major weather concerns, I think people will sow as much wheat as last year, if not more.” Dean Shields, a FarmWeek Cropwatcher from Jackson County, also believes producers may take advantage of wheat prices USDA projected will average $7.10 to $7.90 per bushel for 2011/12. “There seems to be more acres of wheat being planted this year,” Shields said. Illinois farmers as of the first of last week had seeded 33 percent of the wheat crop, 24 percent of which was planted during the first week of this month. Planting progress last week was in line with the five-year average of 34 percent. “It appears favorable fall weather has been of benefit for successful wheat planting over most of the winter wheat areas,” said Kevin Black, GROWMARK insect/plant disease
technical manager. The primary target for wheat planting in Illinois is 10 days to two weeks after the fly-free date, according to Black. Some farm-
ers, however, opt to plant earlier and use an insecticide to control the flies. Farmers who are forced to plant wheat after the target
dates should consider increasing the seeding rate by as much as one-third to compensate for fewer tillers, Black said. — Daniel Grant
Crop Continued from page 1 “I think the two-bushel decline (in soy yields) in Illinois can be attributed to later-planted and double-crop beans,” said Jerry Gidel, market analyst with North American Risk Management Services. “Fifty percent of the (bean) crop was planted after June 1.” The smaller crop estimates, however, didn’t produce a run-up in prices. In fact, last week’s report was bearish for prices. USDA lowered exports for corn, soybeans, and wheat; it slashed feed and residual use by 53 million bushels for wheat and 197 million bushels for corn, raised ending stocks by 76 million bushels for wheat and 194 million bushels for corn; and reduced season average price estimates for all three crops. “Wheat was the whipping boy of the report,” Kitt said. “We continue to find more and more wheat in the world.”
USDA last week raised world wheat production by about 110 million bushels. End-users, particularly livestock feeders, should take advantage of the recent break in crop prices, according to the analysts. “Hog producers are back in the black,” Kitt said. “Thirty to 40 days ago they were bleeding red ink.” But not all livestock feeders are jumping at the chance to buy cheaper grain, according to Bill Tierney, chief economist with AgResource Co. “We’re urging cattlemen to take additional coverage,” he said. “But a lot are reluctant to do that if they haven’t forward-priced fed cattle.” Gidel predicted corn prices in coming months will move back toward $7 per bushel due in part to strong world demand and a possible run-up in ethanol production prior to the expiration of the federal blenders’ credit at year’s end.
FarmWeek Page 8 Monday, October 17, 2011
EMERGING ISSUES
Remember to call JULIE before starting digging projects this fall BY KAY SHIPMAN FarmWeek
As harvest continues to progress at a rapid pace, farmers are reminded to call JULIE before they start fall digging projects. “We want to make sure that they call JULIE,” said Gina Meehan, a public awareness specialist with Ameren Illinois. Meehan noted several
farm tile suppliers already are sold out of tiles, suggesting a good deal of tiling will be done this fall. JULIE (Joint Utility Locating Information for Excavators) provides free information about the location of underground utility equipment in Illinois.
State law does not require farmers to call before doing routine tillage, but notification is required for some farmrelated projects, such as installing field tiles, building waterways, and setting fence posts. Meehan noted natural gas transmission pipelines were hit in four separate accidents from field tile projects last year. “Luckily no one got hurt,” she added. A national 811 telephone number will reach a one-call center in any state. In additional, Illinois has a toll-free JULIE number at 800-8920123. Call center representatives are available to process requests 24 hours a day, seven days a week. The law requires an individual to call no more than 14 days but at least 48 hours in advance of digging, excluding Saturdays, Sundays, and holidays. JULIE representatives then notify the appropriate utility companies that send technicians to the project site to mark underground line locations.
Individuals also may submit online requests to {www.illinois1call.com}; however, online requests are designed only for singleaddress excavations. Meehan encouraged farm-
ers to remind contractors they hire to install tile or do other digging projects to call JULIE. One accident occurred after the contractor, who was required to call JULIE, instead asked a farmer about
underground utilities in the farmer’s field, according to Meehan. The farmer did not know about the pipeline, and it was struck, she said. For more information, go online to {www.illinois1call.com}.
Law enforcement addressing metal thefts Scrap metal thefts are on the rise across Illinois, and sheriffs increasingly are turning to local recycling businesses to help them address the problem. “I don’t think there’s any area of the state that has not been affected. Metal thievery is increasing all over,” said Madison County Sheriff Robert Hertz. Hertz serves as president of the Illinois Sheriffs’ Association. Last week, Hertz met with local recycling businessmen, the county’s state’s attorney, and state lawmakers to discuss potential solutions, including possible legislation that would target thefts. In Sangamon County, an ordinance passed in September
that requires scrap metal dealers to retain a photocopy of a metal seller’s driver’s license for 90 days, the seller’s license plate number, and a description of the metal and its origin. The dealer also must issue a check for any sale exceeding $100, said Jack Campbell, chief deputy in the sheriff ’s department. This year, more than 30 scrap metal thefts have been reported in the county, according to Campbell. In Adams County, the sheriff ’s department has been working with metal recycling businessmen, some of whom have called with concerns, said Sheriff Brent Fischer. The officers advised farmers and rural residents to take steps to reduce potential thefts. “You have to do more to
protect and secure your property,” Hertz said. “Make sure you safeguard your metal property.” Hertz encouraged farmers to report metal thefts to law enforcement. Those reports are especially important if law enforcement receives a call from a concerned recycling business; otherwise, police have no record of missing property, he noted. “We need them (rural residents) to be vigilant. They’re our eyes and ears,” added Campbell. “Most of the time, people are reluctant and don’t want to waste our time, but we want them to call us because we might be able to stop a theft or catch a thief.” Fischer agreed: “If they have any concerns, please contact us. We’re always willing to come talk.” — Kay Shipman
TEACHABLE MOMENT FOR URBAN MOM
Champaign County farmer Jeff Fisher of Tolono chats with Sharon Davis, a Champaign resident and Chicago native, and her children during a recent outreach program sponsored by the Champaign County Farm Bureau. About a dozen mothers and their families were treated to combine rides for a hands-on experience with the far mers who grow their food, fuel, and fiber. This was the second of a twopart effort that began last spring with a myth-debunking discussion with a group of mothers of pre-school students. After visiting with Fisher, Davis said, “I think if more hometown Chicago folks had an experience like this, we’d be more inclined to politically and financially help our Southern and Central Illinois farmers.” (Photo by Susie Harbaugh, Champaign County Farm Bureau assistant manager)
Page 9 Monday, October 17, 2011 FarmWeek
from the counties
Rock Island County Farm Bureau Foundation grows AgXPerience BY DEANNE BLOOMBERG
What started as a simple farm field trip to the city has grown into a three-day event in cooperation with Deere and Co., thanks to the leadership of a husband and wife team. Rock Island County Farm Bureau members Mike and Amy Saddoris took the idea to
the county Young Farmers Committee seven years ago. Today, the event uses more than 60 FFA members in a two-county area and pulls in more than 100 volunteers to provide support for the 1,400 students, teachers, and parent helpers who attend the AgXPerience — a farm field trip to the city held at the Rock Island County Fairgrounds and John Deere Pavilion. This was the first year Deere employees were recognized for their volunteerism at the ag literacy event. The idea was started in response to the growing number of teachers seeking to visit a farm. The AgXPerience was designed to help teachers show their students the importance of farming in the Quad Cities and the many benefits of a viable farming community. Students spent two hours at the fairgrounds where they saw dairy and beef cows, corn and soybeans, horses and farm machinery, sheep and hogs, and took part in a make-andtake gardening activity. In addition, the students
Rockridge FFA member Lucas Crawford, center, helps elementary students plant and water their seed at the AgXPerience Make and Take station.
spent 90 minutes at the John Deere Pavilion where they learned about the life of John Deere, the role of a blacksmith in earlier Deere times, and the many pieces of machinery made by Deere and Co. They also learned about the new food plate guidelines and the importance of a well-balanced diet. The event was coordinated by the Rock Island County Farm Bureau Foundation and the John Deere Pavilion. It was partially sponsored through a Monsanto “Farmers Grow Our Communities” grant. The county Farm Bureau Foundation is a not-for-profit organization whose mission is to promote production agriculture and the food, fiber, and fuel system through quality
Illinois Farm Bureau State Young Leader Committee member and Deere employee Todd VerHeecke and longtime AgXPerience presenter Sue Gray explain to students the many products that come from corn and soybeans. (Photos courtesy Rock Island County Farm Bureau)
agriculture literacy efforts in the schools and communities of Rock Island County. DeAnne Bloomberg is the Rock Island County Farm Bureau manager. Her e-mail address is dbloomberg@ricofarmbureau.org.
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UMBERLAND — Far m Bureau will sponsor a stroke detection plus screening from 9 a.m. to 4 p.m. Wednesday at the Toledo Christian Church. The four-screening profile is $100 for Far m Bureau members. Call 877-7328258 for an appointment. Call the Far m Bureau office at 217-849-3031 for more infor mation. • The Women’s Committee will sponsor a pumpkin decorating contest during October. Pumpkins must be 9 inches in height and must not be car ved or punctured. Age divisions are from 3 to 15 years and older. Winners will be announced Friday, Nov. 4. Bring decorated pumpkins to the Far m Bureau office by Oct. 31. Call the Far m Bureau office at 217-8493031 for more infor mation. EWITT — Prime Timers will visit Hardy’s Reindeer Far m, Rantoul, Friday, Nov. 4. Dutch treat lunch will follow at the Red Wagon Restaurant. The group will carpool from the Far m
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Bureau office at 9:30 a.m. Cost is $10 for the tour. Reser vations and payments are due to the Far m Bureau office by Wednesday. Call the Far m Bureau office at 217-935-2126 for more infor mation. EE — Plat books are available at the Far m Bureau office from 8 a.m. to 4:30 p.m. Monday through Friday. Cost is $30. Call the Far m Bureau office at 857-3531 or e-mail leecfb@comcast.net for infor mation on shipping. OCK ISLAND — Tickets are available for the annual Har vest Gala Saturday, Nov. 12, at the iWireless Center, Moline. Proceeds will benefit the Rock Island County Far m Bureau Foundation. Cost is $50, which includes appetizers and dinner. Silent and live auction items are needed.
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“From the Counties” items are submitted by county Farm Bureau managers. If you have an event or activity open to all members, contact your county Farm Bureau manager.
FarmWeek Page 10 Monday, October 17, 2011
profitability
Don’t base management decisions on too limited data BY LANCE RUPPERT
Harvest turns the page on another growing season. I have written in the past about observing and learning from the growing season and gaining knowledge to make better decisions in the following year. Most good decisions come from some solid facts; information and knowledge are crucial when making important decisions. Information is everywhere. We have more information at our fingertips than ever before. We are bombarded every day with television, radio, web-
hybrid or variety will fail somewhere, and that same hybrid or variety will shine somewhere else. Don’t put too much emphasis on data from one plot or from one year. Try to look at data compiled from multiple sites and from multiple years, if it’s possible. Your local FS crop specialist can help you gather good information to assist you in making informed decisions.
sites, e-mail, Twitter, and text messages. Sometimes we even learn things from face-to-face conversations with another person. As you gather yield information this fall, take a minute to think about plot data so you can make good, fact-based decisions for next year’s crop. Fundamentally, hybrid and variety plots are good. They give seed companies and growers a way to evaluate and compare products across a large geography and in a variety of environments. In most areas of Illinois, the growing environment wasn’t
ideal, with multiple factors working against our yields. Extreme environments can cause extreme differences in product performance because not all genetics react the same in those environments. Lance Ruppert Be cautious when looking at and making decisions based on plot data. Remember: Good, reliable information is what you need to make good decisions.
Ask questions about what happened throughout the growing season that may have affected the plant’s ability to perform (wet spring, compaction, wet holes, hot and dry, wind, etc.). When was the plot planted? That will have a direct correlation to pollination/flowering date and the environmental effects on those important times in the plant’s life. Consider looking at multiple locations and multiple years of data. Every year and location are different. With extreme environmental conditions, every
Lance Ruppert is FS Seed sales and marketing manager. His email address is lrupert@growmark.com.
with North American Risk Management Services, predicted an acreage battle may develop in the markets this winter as soybean supplies also could be tight, depending on South American production. “It looks like we need another 2 million acres of corn,” he said. “It looks like there could be another acreage battle.” If farmers plant more corn next year, some of it will be planted in corn stubble. And that could pose a problem as corn-on-corn or continuous corn yields this year at some locations were 20 bushels — in extreme cases as much as 60 bushels — below yields of corn-after-soybeans.
In fact, this is the second year in a row a number of farmers in Illinois reported a yield penalty for corn-on-corn.
A dry finish to the season cut into yields more than many farmers suspected prior to the 2010 harvest. This year, Nafziger said the wet spring delayed planting of corn in corn stubble; many fields were mudded in, which caused field compaction; fertility issues popped up; and root structures weren’t well-developed enough to handle the hot and dry conditions in July and August. Doug Uphoff, a farmer and FarmWeek Cropwatcher from Shelby County, reported corn-on-corn yields averaged about 20 bushels less than corn-after-soybeans on his farm. “Last fall we had a lot of ground left unworked. We had too many stalks that tied up nitrogen,” Uphoff said. “And with early rains this spring, I suppose we lost more (N) there.” Timing of planting also was crucial as April-planted corn,
most of which was corn-aftersoybeans, averaged about 170 bushels per acre, while Mayplanted corn on Uphoff ’s farm averaged between 130 and 150 bushels per acre. Uphoff ’s farm from June 25 to early August received a total of just a half-inch of rain. He plans next season to implement a two-thirds corn, onethird bean rotation to eliminate continuous corn from the mix. “Our corn-on-corn was a little better than continuous corn,” he noted. Overall, if farmers in Illinois maintain the recent mix of about 12 million acres of corn and 9 million acres of beans, corn-on-corn will continue to be a key element of the rotation. “As long as corn acreage stays near the 12 million acres of recent years, 20 to 25 percent of Illinois corn will have to be corn-following-corn,” Nafziger added.
Corn-on-corn acres could grow despite recent production issues BY DANIEL GRANT FarmWeek
Some acres of corn-oncorn, particularly those in continuous corn, had yield issues again this year due in part to weather and fertility challenges. But those challenges likely won’t stop farmers from planting more corn-on-corn acres next year as strong demand is expected to give farmers incentive to plant more kernels. “We’re running a deficit (in corn carryout numbers this year compared to last year),” said Jerrod Kitt, director of research with Linn Group, during a teleconference hosted by the CME Group. “We need more production.” Jerry Gidel, market analyst
M A R K E T FA C T S Feeder pig prices reported to USDA* Weight 10 lbs. 40 lbs. 50 lbs. Receipts
Range Per Head Weighted Ave. Price $22.00-$49.62 $33.58 $51.00 $51.00 n/a n/a This Week Last Week 42,219 16,613 *Eastern Corn Belt prices picked up at seller’s farm
Eastern Corn Belt direct hogs (plant delivered) Carcass Live
(Prices $ per hundredweight) This week Prev. week $92.39 $90.90 $68.37 $67.27
Change 1.49 1.10
USDA five-state area slaughter cattle price Steers Heifers
(Thursday’s price) Prev. week This week 119.05 118.80 119.01 n/a
Change 0.25 n/a
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 135.23 1.90
This week 137.13
Lamb prices Slaughter Prices - Negotiated, Live, wooled and shorn 110-143 lbs. for 165-198 $/cwt. (wtd. ave. 175.74); dressed, no sales reported.
Export inspections (Million bushels) Week ending Soybeans Wheat Corn 10-6-11 23.4 12.6 31.8 9-29-11 11.2 22.3 29.3 Last year 49.2 23.5 33.7 Season total 69.1 406.9 143.6 Previous season total 118.5 409.6 204.7 USDA projected total 1375 975 1600 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.
‘It looks like we need another 2 million acres of corn.’ — Jerry Gidel Market analyst North American Risk Management Services
“Despite different planting and crop conditions in 2011 than in 2010, we are again hearing that corn-followingcorn is producing lower yields than corn-followingsoybeans in many areas,” said Emerson Nafziger, University of Illinois Extension agronomist. A drop-off in corn-on-corn yields last year mostly was due to the weather, Nafziger noted.
Popcorn producer surprised by above-average yields Some farmers at the height of the heat wave this summer, when temperatures were in the high 90s and even triple digits, jokingly expressed concern that their field corn might start popping on the stalks. But the weather concerns this season were no laughing matter for Darell Sarff, a longtime popcorn producer from Mason County. His specialty crop, obviously, wouldn’t pop on the stalks. But the extreme heat was a real threat to kernel quality, which is king in the popcorn industry. “Quality is the key (with popcorn production),” Sarff said. “That’s why a lot of (contract) acres were moved to Mason County and Nebraska, because irrigation (at those locations) guarantees yield and quality.” Sarff this year grew 300 acres of popcorn for the farm cooperative Pro-Fac, which supplies processing facilities around the country with fruits, vegetables, and popcorn. And he was pleasantly surprised with yields. A good popcorn crop produces about 5,000 pounds per acre, according to Sarff, who served on the Illinois Farm Bureau Board of Directors from 1986 to 1996. “I finished harvest about 10 days ago,” he said last week. “And the popcorn surprisingly
was better than I thought it would be. It was above average.” Most of the crop produced on Sarff ’s farm is used for microwave popcorn sold at retail locations and to supply sports venues around the country. In fact, Mason County is one of the top popcorn-producing counties in the nation. Illinois recently ranked third nationwide in popcorn production. Former Gov. Rod Blagojevich in 2003 even signed a bill that made popcorn the state’s official snack food. Sarff has produced popcorn every year since the mid-1980s. Production practices for popcorn are similar to field corn — he uses the same combine for harvest — but Sarff recommended farmers only grow it if they have a contract. Otherwise, independent growers may be left holding the bag during years of bountiful popcorn production. “It takes a little more management to grow popcorn” Sarff said. “But I wouldn’t consider growing it without a contract.” Producers sell their popcorn by the pound. The price is set on a basis and multiplier of December corn futures. — Daniel Grant
Page 11 Monday, October 17, 2011 FarmWeek
PROFITABILITY Corn Strategy
C AS H ST RAT E GI S T
A subtle, but important, shift seen in crop price relationship If anything, the most recent USDA supply/demand projections increased the influence wheat prices might have on corn prices, especially with wheat still competing with corn as a feed in the world. USDA raised its world ending stocks estimate for both wheat and coarse grain. The combined total was 13.8 million metric tons (mmt.) higher than last month, with the stocks outside of the U.S. and China increased nearly 7 mmt. for the 2011/2012 marketing year. Last month’s forecasts pointed to a small decline. A lot of the shift in the ending stocks forecasts for countries other than the U.S. and China is tied to steady increases in production expectations in the Black Sea area countries, European Union countries, and Australia. With the larger supply, USDA increased the feed consumption for both wheat and coarse grains 5.22 mmt. from the level it expected just a month ago. Total feed consumption in foreign countries (minus China) is expected to jump nearly 20 mmt. from last year. The increase in output and inventories offer the supply to be fed, but we are not sure the economics are strong
enough to warrant that big of an increase. That’s a bigger jump than occurred from 2007/2008 into 2008/2009. And, as a whole, livestock inventories are not significantly different than they were a year ago, with numbers generally a little smaller in the Black Sea countries that were hit so hard a year ago. So unless grain prices languish for some time, the current feed demand forecast might be a little aggressive. And if it is, ending stocks could end up a little larger yet. It also is important to recognize the stocks/use ratio for wheat and corn in foreign countries (minus China) is not nearly as tight as it was in 2006/2007 or 2007/2008, the two years leading up to the elevation into the current “higher price structure.” The actual stocks projection is 50 mmt. higher than it was then, but total demand is 90 to 100 mmt. higher as well. The key to the shift lies in understanding the combined stocks went from declining at the end of the 2010/2011 marketing year to increasing. Emotionally, that has big implications, especially on how world buyers approach their purchasing/import buying strategies. There’s less perceived need to aggressively cover needs forward, leaving the market with a more negative overtone. Still, China remains a wild card. But purchases to rebuild Chinese inventories likely will be more politically driven than market driven.
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ü2011 crop: December corn reached an upside target at $6.40, but upside momentum stalled because of declining wheat prices. A close below $6.20 would suggest the minor trend might have turned lower again. Still, wait for December to rebound to $6.60 to make catch-up sales. We may add to sales at that level. Hedge-to-arrive (HTA) sales for late winter/spring delivery are still the best tool for sales. ü2012 crop: Use rallies to $6.20 on December 2012 futures for catch-up sales. We may add another increment at that level. Check the Hotline frequently. vFundamentals: There weren’t any significant surprises in the Oct. 12 USDA report, but the changes that were made had slightly negative repercussions. However, the increasingly negative structure for wheat is adding to the downward drag. China bought 1.2 million metric tons of corn (47.2 million bushels) for government reserves, with talk that even more sales have been made. Those are purely political decisions, making it difficult to anticipate the timing.
Soybean Strategy
ü2011 crop: A shift in attitude regarding European financial problems and slightly stronger fundamental forecasts allowed soybean prices to rise. Even though we don’t anticipate prices will steadily move up, we’d now target a move to $13.25 for catch-up sales. We may add to them at that level. A HTA for winter/spring delivery may pay if you store soybeans on the farm. Commercial storage is a closer call. ü2012 crop: Wait for a rally to $12.75-$13 on November 2012 futures for catch-up sales. We may add another sale if it reaches that level. vFundamentals: Of the three major grains, soybean fundamentals have become the strongest. While that doesn’t guarantee a move to sharply higher levels, it does indicate prices should hold up better. China has gotten more active again, but this is the time of year when our sales to the Chinese are most robust.
Processing margins have improved, but the pace is still relatively slow.
Wheat Strategy
ü2011 crop: The shortterm picture in wheat doesn’t look good, with prices possibly poised to test the previous low at $5.96 on Chicago December futures. Hold off catch-up sales for now to see if prices might rebound more. We may recommend another 20 percent sale depending on the extent of any rebound. Check the Hotline daily. The carry in futures still pays for commercial storage, making a HTA contract for winter or spring
delivery the best tool. ü2012 crop: Given last week’s developments, we are considering an initial sale. Check the Hotline daily. vFundamentals: The latest price break came from USDA increasing U.S. stocks to 837 million bushels. USDA also increased global wheat stocks 4 percent. The higher stocks, lower exports, and strong international competition are making it difficult for wheat to sustain upside momentum. The good rains across the Southern Plains temporarily removed an early threat to next year’s crop, too.
FarmWeek Page 12 Monday, October 17, 2011
perspectives
Cooperatives improve lives around globe, the corner This year, a group of GROWMARK board members took a trip they will never forget. They traveled to the African nation of Ghana, where farmers known as smallholders survive on as little as five acres using what we would consider primitive farming methods. Most can produce just enough to sustain themselves; however, sometimes they have a small surplus, which can result in additional income for their families. DAN KELLEY To aid in storage and marketing of surplus grain, ACDI/VOCA has funded storage and processing facilities in several villages. GROWMARK has long been a supporter of ACDI/VOCA, an organization that fosters economic growth in developing countries using a variety of programs, including construction of grain dryers and scale houses for Ghanaian smallholders. The name dates back to 1997’s merger of Agricultural Cooperative Development International and Volunteers in Overseas Cooperative Assistance. The introduction of the cooperative model has given hope to many small farmers across the globe and allowed them to create better lives for themselves and their families. October is the month when we traditionally recognize cooperatives in the United States.
The theme for this year’s celebration and for the upcoming International Year of Cooperatives is “Cooperative Enterprises Build a Better World,” which no doubt was witnessed by those who made the trip to Ghana. Around the world and around the corner, cooperatives are working to improve the lives of their member-owners and the communities in which they live and work every day. There are more than 29,000 cooperative businesses in the United States, operating in every sector of the economy. U.S. cooperatives generate 2 million jobs, produce annual sales of $652 billion, and possess assets of $3 trillion.
More than 80 years ago, a group of Farm Bureau members seeking a reliable supply of quality products at a reasonable price joined together to create the first FS cooperatives, which today make up the GROWMARK System. It is comprised of FS and grain member cooperatives and subsidiaries, and employs more than 7,000 people, who in turn serve more than 250,000 customers. GROWMARK does business in more than 20 states, Ontario, Canada, and Mexico. The continued patronage of local FS cooperatives and GROWMARK by Farm Bureau members such as you is what makes our cooperative system strong. American agriculture is thriving, and because of the relationships built by working together, we can continue in our goal of feeding the world. Thank you for your continued support. Dan Kelley is GROWMARK’s chairman of the board and president. He farms near Normal.
New ideas present a walk on the wild side of ag advocacy Steering clear of “producer” and “industry” when talking about food grown or raised by America’s farm and ranch families was one of the tidbits of advice offered at a recent gathering of Farm Bureau members and staff from around the country involved in agricultural promotion and education. The solution? Just use “farmer.” J. Scott Vernon, a featured CYNDIE speaker at SIREKIS Farm Bureau’s national Promotion & Education Conference, is the founder of “I Love Farmers ... They Feed My Soul” and a professor of agricultural education and communication at California Polytechnic State University. He is not alone in urging food producers to call themselves farmers. Vernon and the board of directors of I Love Farmers, none of whom is older than 25, do stand out in the growing field of those dubbed “agricultural advocates” due to their chosen methods of engaging with the non-farming public.
Provocative is an apt description for some of the strategies used by the young agricultural enthusiasts (ages 15-25) who make up I Love Farmers. The 501(c)(3) charitable organization was founded by Vernon to “create a conversation among peers about our food, our farmers, and our future.” The slogan “Where’s the Food Without the Farmer?” is one example. T-shirts, ball caps, and temporary rub-on tattoos emblazoned with the slogan are wildly popular as conversation starters when worn by supporters. Hosting rap and reggae concerts and using social media are other fun ways to get points about today’s farming across to young people, according to Vernon. Going even further afield from the traditional venues ag advocates often frequent to reach the public, such as farmers’ markets and community fairs, supporters have placed “I Love Farmers” artwork in tattoo parlors. Spreading the word about today’s agriculture in tattoo parlors may have some merit. According to the website {VanishingTattoo.com}, which features facts and statistics about inked body art,
14 percent of Americans now have one or more tattoos. That’s up from 6 percent in 1936. Looking at age breakdowns is even more revealing. A 2006 study done by the Journal of the American Academy of Dermatology found that 36 percent of Americans between the ages
of 18 and 29 have at least one tattoo. Expanding the age bracket studied up to 50 reveals that 40 percent sport some ink. Despite the growing prevalence and increased acceptance of tattoos, does Vernon really think people will ask for “I Love Farming ... it Feeds My Soul” tattoos?
Not at all, he says. “This is just one more place where we can reach people and get them talking about food and farming,” he suggests. Cyndie Sirekis is director of news services with the American Farm Bureau Federation. Her e-mail address is cyndies@fb.org.
‘I wasn’t even replaced by a machine. They just put an attachment on an old one.’