Friday, March 06, 2009
Extension Update is a weekly summary of news from Extension, government, and other attributable sources, focused on marketing, farm management, and other issues that are of interest to Midwestern farm owners and operators.
Soybeans may have a record year, says Iowa State’s Chad Hart, particularly if 77 mil. acres are planted to beans, which would be a record amount of land. He says USDA is projecting that level based on lower input costs compared to corn. The resulting 3.24 bil. bu. would also be a record, as would a projected 1.225 bil. bu. of exports. However, Hart says production will exceed use and stocks will increase with an average $8 season price.
Grain markets still have their sights on South American crops and how much production was lost to the dry spell over recent months, says Chad Hart. USDA thinks South American corn production will be down 21% and beans down 6%. With global trade shifting to South America, US weekly corn sales were down 66% and exports down 15% compared to the prior week. Soybean sales were down 69% and exports down 28%.
Corn prices have been hurt by some negative fundamentals says Mike Roberts at VA Tech. He says a drop in crude oil, plunging equity markets, and gains in the US dollar pressured prices, along with the fact Japan bought Romanian corn, “New surveys show that many producers have ’08 corn still in the bin. It would be a very good idea to get it sold at this time. It might be a good idea to price up to 45% of the 2009 crop.”
The soybean market is impacted by the same fundamentals says Roberts, who also says soybean prices are being pressured by the fact “The Argentinean government is interested in taking over their large soybean industry so they may regulate prices to their own buyers.” And Roberts adds, “Cash soybeans are steady to stronger. It might be a good idea to get all old crop beans sold and price up to 25% of the ’09 crop.”
A 50/50 chance. That’s what Iowa State Meteorologist Elwynn Taylor is giving for La Nina-derived weather problems in 2009. He says the current event shows signs of weakening, but there is no clear trend, which usually is apparent by mid-March to mid-April. So he says the chance of a neutral versus La Nina condition by June is 50/50.
What does a La Nina mean? Elwynn Taylor says the trend line corn yield for 2009 is 153.4 bushels per acre, with a Dec futures value of $4.53 at harvest. He says the historical response to the La Nina would give a 144 bu. yield with a Dec harvest value of $5.45. If La Nina shifts to neutral, he expects 155 bu. and a Dec futures price of $4.37.
USDA’s Risk Management Agency earlier this week certified the spring guarantees for revenue-based crop insurance such as Revenue Assurance (RA) and Crop Revenue Coverage (CRC). The spring guarantees are $4.04 for corn and $8.80 for soybeans. The sign-up deadline is March 16 for spring planted row crops in the Cornbelt, for anyone signing up for the first time or making substantial changes in a crop insurance program.
Some of the variables remain unknown for the ACRE program, including your farm’s performance and the final tally for state average prices from the current marketing year. However, IL Extension economist Nick Paulson has estimated Illinois guarantees:
1) For corn the yield component will be roughly 164 bu/acre and the price component is projected about $4.05 per bushel, implying a state-level revenue guarantee of $600/A.
2) Similarly, the current projections for the revenue guarantees for soybean and wheat acres for 2009 are approximately $400 and $345 per acre, respectively.
Evaluating several thousand farm records, Paulson estimates ACRE would have been triggered in 10 of the past 31 years for IL corn with average payments of $53. Payments averaging $37 would have been made on IL soybeans in 5 of the last 31 years. Read more.
Choosing ACRE requires awareness. Paulson says, “If farm yields tend to closely follow the (state) average, the farm trigger criteria will have a greater chance of being met in years when ACRE payments are triggered. The timing of payments should be considered. Because of the definition of the price component used by the ACRE program, the revenue guarantee will not be completely established prior to expected sign-up periods in the spring and the actual revenue measure used to determine ACRE payments in a given year will not be finalized until just before harvest of the following crop year.”
Supplemental Revenue Assistance, the permanent disaster aid program known as SURE, has been reopened for 2008 crop problems until May 18 at FSA offices. SURE required producers to have purchased crop insurance for all insurable crops that accounted for 5% or more of their expected gross value of crop production in 2008. The chance to pay a $100 per crop fee has been extended, but the coverage limit is 70% of the proven yield. Producers who enroll to make a 2008 claim must also enroll for 2009.
SURE payments, if a disaster is triggered, are bolstered by a crop insurance policy, says Ohio State Extension’s Chris Bruynis, “If a farmer chooses not to purchase crop insurance, they cannot participate in SURE. Essentially the SURE revenue guarantee will be 115% of the crop insurance coverage level plus 120% of the NAP coverage levels. If a 75% coverage level is purchased the SURE revenue guarantee will be approximately 86%. The SURE revenue guarantee is capped at 90% of expected crop revenue.”
With a wet fall and a possible wet spring, are you considering a switch to no-till to save time on field preparation? Iowa State agronomists suggest several considerations:
1) Check internal field drainage for ponds, plugged tiles, and plugged inlets.
2) Soil temperature is critical and strip tillage is one way to warm, but conserve soil.
3) Poor plant performance could reflect moisture or compaction problems below the seed.
4) N, P, & K needs are the same in no-till, but P & K mineralization is slower.
5) No-till does not change the economic returns for corn following soybeans.
Beware of problems that could spell danger on some newer anhydrous ammonia applicators. Iowa State ag engineer Mark Hanna says high N prices have lead to flow controllers that can shut off individual knives. But he says it traps pressurized ammonia at locations in the system, requiring the entire applicator to be bled before servicing. Read more.
Have all your decisions been made for your 2009 corn and soybean crops? What about:
1) Corn or beans?
2) Are your soil fertility decisions made?
3) Row width?
4) Seeding rate?
5) Planter maintenance?
It is too early to tell how the wheat crop survived the winter, says Ohio State University agronomist Pierce Paul, “March is always a very stressful time for wheat due to the rapid changes in air temperatures, potential for heaving, and flooding. However, what we've seen thus far is that the wheat seems to be coming out of winter in pretty good shape and that's largely because we had a good planting season and good snow cover.”
What about N for wheat? OSU agronomists say, “In general, if 20-30 pounds of nitrogen was applied at planting, wait until May 1 for more and don’t waste application money or risk loss of early N. Applications of 28% should be made with large flood jets and just enough pressure to produce a good application pattern, which produces a reduced number of very large droplets and reduced leaf burn. Stream bars for 28% application will also greatly reduce crop damage. Urea application rarely causes leaf burn.”
If the winter was cold in your part of the Cornbelt, that reduces the chances of survival of flea beetles which spread Stewart’s Wilt to corn seedlings. Regardless of how cold you got, OSU crop specialists are happy, “Because of a relatively cold January, much colder than normal, the index values are lower than we often see.” Risks may be low.
Grow it for silage and biomass, but not for grain yield. That is the low down on a new corn hybrid from IL plant geneticist Stephen Moose who says his work with the Glossy 15 gene shows the plant will get bigger at the end of the season, with more sugar in the stalks and fewer kernels on the cob. That means it is good for cellulosic ethanol plants.
Pork demand is up says MO livestock economist Glenn Grimes, “Surprising as it may seem to be our demand index for November 2008 through January 2009 shows about a 2% increase in pork demand and above a 1% increase in live hog demand. There appears to be a cycle in pork demand and the rate of decline in demand was decreasing through fall. Certainly, 3 months is not a long enough period to project a trend; but with the weak general economy, we will take stronger demand for any length of time we can get it.”
Pork producers can get on the “green” bandwagon with a spray of soybean oil inside their hog barns. Purdue researchers found it decreases methane emissions by 20%, and carbon dioxide by 19%, both of which are greenhouse gases. There was also a 65% drop in dust in the air. The researchers say cost issues and clean-up need to be resolved yet.
Posted by Stu Ellis on 03/06 at 01:11 AM | Permalink