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Saturday, July 30, 2011

Cornbelt Update Offered as a Weekend Special


• Monitor the Aridity Index to learn your yield prospects.  It combines temperature and precipitation relationships for the Cornbelt, and is computed for each county, says IA St. meteorologist Elwynn Taylor.  He says it does not consider the Growing Degree Days, the impacts of excess water, the fate of nitrogen in the soil of the farm, or any number of other factors impacting crop yield, but can have a market impact for a wider area.  The index is directly related to the probability of having a district yield that exceeds the historical trend line.
• Corn problem #1.  Several problems are facing corn says IL agronomist Emerson Nafziger.  High night temperatures mean larger losses of sugars to respiration at night, and so less sugar available to fuel crop growth.  This is a drag on growth rates because the plant has to produce extra sugar just to keep up. When high night temperatures occur at the time of seed setting, as is the case this year, there is likely some negative effect on final seed numbers and yield.
• Corn problem #2.  High humidity means higher night temperatures, and so contributes to that problem. Relative humidity drops as temperatures rise in the morning, and this helps the air pull water vapor out of the leaf through stomata.  High relative humidity and low wind speed slow drying of leaves in the morning and may contribute to spread of foliar diseases.
• Corn problem #3.  If stomata in the leaf are wide open there is maximum CO2 intake and photosynthesis, but also gaps for water to leave.  That is needed to cool the leaf during photosynthesis, but if water becomes limiting as soils dry out, the stomata start to close. This reduces the rate of water loss while also reducing photosynthetic rates.
• Cornfields, flattened by the July 11 derecho winds that blew from Nebraska into Ontario and Ohio, have generally recovered in many areas.  Some bowing at the brace root has been noted, along with some greensnap.  However, once considered to be problems for harvesting, many cornfields have popped back up.  Not so with some grain elevators such as the Tama-Benton Coop.  Manager Mel Campbell say his Clutier facility was hit, with Dysart and Vinton.
• Soybean yields will not be hurt as much as corn by weather says Emerson Nafziger.  He says as sugar levels drop in stressed corn, then kernels are aborted, and new ones are not produced, despite improving weather.  However, he says beans continue to flower and develop pods for 3 weeks longer than corn, and there is greater potential for yield recovery.
• Soybeans can wilt, and it may be a root disease problem.  MO plant pathologist Laura Sweets says the early wetness fostered phythophthora, Rhizoctonia, and fusarium, all of which weaken root systems.  She says, “Moderate and consistent weather conditions might help alleviate the stress on plants and keep some plants from dying but continued high temperatures or changes in weather conditions may lead to more wilting and death of plants.”
• Everything had been going so well, until this year when declining corn rootworm populations have seemed to reverse.  Early indications point to a moderate population level, after declines in 2009 and 2010, says IL entomologist Mike Gray.  He says lower doses of toxic Bt proteins were being used to reduce larvae, but now more adults are emerging.  Gray and others are developing statistical models to predict emergence based on “refuge in a bag” seed.
• Also on the upswing is the number of European corn borers being found in cornfields, says Purdue entomologist Christian Krupke.  Since the introduction of Bt hybrids their numbers have moved them into the category of a minor insect, but Krupke says if farmers have begun to forget about corn borers and abandoned the use of Bt corn, their numbers will return.
• Hot and dry weather stress crops, and that means additional insect pressure will only make things worse.  That is why spider mites can take a quick toll on stressed soybeans.  However, “If we return to cooler temperatures and get some rain in the next week to 10 days, the observation of two-spotted spider mites may be just an interesting footnote to the season,” says IL entomologist Mike Gray.  He suggests a treatment of chlorpyrifos and dimethoate.
• Welcome to Cornhusker land, M/M Japanese beetle.  They were spotted this week for the first time in Nebraska fields feeding on soybean leaves.  Apparently they have been satisfied in the past with Nebraska urban life, but have begun to retire to a rural lifestyle home.
• Japanese beetles have caused IA St. entomologists to turn on the air raid alert, based on potential damage to both soybean leaves and corn silks.  Foliar insecticides do not provide season-long control, and will not control insects migrating to fields after the application.
1) Soybean treatment threshold is 30% defoliation before and 20% defoliation after bloom.
2) Corn threshold is 3+ per ear clipping silks under ½ inch AND under 50% pollination.
• Northern soybean producers may want to bone up on scouting for soybean aphids when temperatures cool, allowing them to multiply.  MN entomologist Ian MacRae says the threshold for treatment is 250 aphids per plant and there is a method for speed counting, but look for:
1) the presence of lady beetles or lacewings, both of which eat aphids.
2) the presence of ants, which tend aphids for honeydew, the aphids produce
3) the honeydew which is a sticky, shiny surface on leaves which may develop a dark mold.
4) the presence of what appears as white fluff; which are the cast-off skins of growing aphids
• What is your liquidity?  Volatility in your net farm income has alternated comfortable years with “tight” years.  Your plans for growth can be uprooted by the lack of liquidity, which can vary year to year.  IL ag economist Paul Ellinger says knowing your liquidity aids management:
1) Liquid cash is key to livestock operators who have a higher number of cash transactions.
2) High liquidity provides a buffer to help grow in times of potential revenue downturns.
3) High liquidity provides opportunities for spec purchases such as machinery or land.
• With cuts to Census Bureau spending, fewer reports on commodity use will be available to help the market determine prices.  Reports being terminated include flour production, production of soybean meal and oil, and how much soybean oil is being used for biodiesel.  Trade associations complained to USDA’s chief economist, but were preaching to the choir.
• What is your preference: rural broadband internet service or GPS for your crop operations?  That is the juggling act currently for many farmers whose GPS signals were lost this spring due to LightSquared and its effort to provide rural broadband near a GPS frequency.  The company has aligned with three former Members of Congress, who are now lobbyists to help work out the problems.  The former Congressmen seem to recognize your problems.
• 2Q was not friendly to the Ag Index of stocks of agricultural companies.  IL ag economist Clay Kramer reports a 6% downturn in stock values for those 21 companies, compared to a 0.5% decline in the S&P 500 Index. Each of the 5 sectors and 18 of the 21 stocks in the index recorded declines.  This was the first decline in the Ag Index since 2Q of 2010.
• Mark your calendar.  August 1 is your deadline for enrolling in either the Direct Payment or ACRE program for your 2011 crops.  However, any enrollment in the Direct Payment program may the last.  ACRE is not as threatened, but all USDA spending is uncertain.
• Brazilian soybean acreage is expected to increase by 1.9 mil acres according to newsletter, which says practically all states anticipate increased acres.  Brazilian beans are priced in dollars and currently they range from $11.31 to $12.55.
• Brazilian ethanol is in short supply and the energy minister has publicly said that some ethanol might be imported in an effort to fuel Brazilian automobiles.  The problem is that sugar is not readily available for ethanol refining and the government is considering a different formula for the percentage of ethanol in motor fuel, which would lower it to 18% from 20%.
• With Canada and Mexico being among the biggest buyers and sellers of US commodities, their producers and consumers can impact US markets.  The National Ag Statistics Service has created a website that provides data for all 3 nations.  It says Canada had 2.7 mil. acres of corn, and Mexico had 18 mil. in 2007.  Old news, yes, but learn about any trends you can.
• Retail pork demand during June was above 2010 for the 10th consecutive month, says MO livestock economist Ron Plain.  The average price of pork at retail during June was $3.481/lb, down 0.3¢ from May, but up 37.7¢ from June 2010. The average live price for 51-52% lean hogs in June was $69.88/cwt, up $1.47 from May, up $11.65 from June 2010, and a new record for this USDA data series that began in January 1996.  Iowa State calculations estimate the typical market hog was sold at a profit of $13.60 in June. The average for the first half of 2011 was a per head profit of $6.49. Hogs have been profitable in each month after January.
• Hot, dry weather is causing pasture conditions to deteriorate, says livestock economist Ron Plain, especially in the southern plains. On July 17, 32% of US pastures were rated poor or very poor. Last year, only 11% of pastures were rated in poor or very poor condition. Texas, the number one cattle state, has the worst of it. An amazing 94% of Texas pastures are in poor or very poor condition. 78% of Oklahoma pastures are rated poor or very poor.
• The Texas drought has sent livestock to auction in record numbers as backgrounders and feedlots are shipping animals to slaughter early for lack of feed and diminished water supplies. Texas media reports many operators liquidating entire herds, which will reduce corn demand and raise feeder prices.  However beef prices remain high because of the global demand.

Cornbelt Update is a weekly publication by S2LS Ag Communications and Consulting.  Republication or distribution is prohibited without prior permission.  Subscription fee is $65 per year.  Address subscription requests to: © 2011

Posted by Stu Ellis on 07/30 at 10:26 AM | Permalink

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