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A GOVERNMENT ag ency last week warned that the nation’s GDP would drop significantly in the next 40 years under House capand-trade proposals. .......................2

STATEMENTS OF CANDIDACY from those seeking election to the positions of president and vice president of Illinois Far m Bureau are being sought. ..............3

WITH A NEW UN REPORT citing record global hunger, U.S. soy protein is being seen as a possible way to put protein in the planet’s poorest bellies. ..........................9

Monday, October 19, 2009

Two sections Volume 37, No. 42

Better biodiesel balance promoted to EPA BY MARTIN ROSS FarmWeek

Periodicals: Time Valued

Sustainable soybean tillage practices, biotechnology, and higher soybean/soy oil yields have significantly improved biodiesel’s energy profile and prospects as a federally endorsed biofuel. The National Biodiesel Board (NBB), USDA, and University of Idaho joined last week to detail new analysis verifying that soy biodiesel has “the best energy balance of any transportation fuel currently commercially available,” according to NBB CEO Joe Jobe. The USDA-funded analysis indicates biodiesel generates 4.56 units of energy for every unit of fossil energy expended to produce, distribute, and burn it. That’s compared with a previous 3.2 energy ratio the U.S. Environmental Protection Agency has used to evaluate biodiesel’s environmental impact. USDA’s Ag Research Service (ARS) and University of Idaho scientists based estimates on 2002 data. Since most biodiesel plants have been built since then, the industry has become even more efficient in its use of fossil inputs, Jobe said.

He cited the importance of new findings with EPA “on the cusp” of implementing a revised renewable fuels standard (RFS) that sets the stage for 36 billion gallons of annual biofuels use by 2022. Under the RFS, EPA will evaluate the benefits of individual biofuels based on their greenhouse gas “footprint” relative to gasoline and diesel fuel. Jobe maintained the agency included “a number of flawed assumptions” in its determination on biodiesel, including a 1998 USDA-Department of Energy (DOE) energy model. EPA ended public comment on RFS proposals on Sept. 25, but NBB included new biodiesel findings in its response to the draft plan. “A lot of things have changed in 10 years,” Jobe told FarmWeek. USDA senior economist Jim Duffield admits even new analysis is “a little outdated” — EPA and ARS are working to update estimates to this year. Current industry

technology could boost biodiesel’s energy balance beyond 5 units of output per

unit of input, he said. The newest study attributes improved energy efficiency to

increased minimum tillage See Biodiesel, page 4

38 YEARS AND OUT

Mark Blindt, a Warren County farmer, stands in an empty hog building that just last month housed numerous animals. Blindt raised hogs for 38 years but recently exited the business due to low hog prices, high input costs, and a lack of a market for his feeder pigs. He said he could not justify needed upgrades to his facilities. See additional information on the problems hog producers are facing, and new approaches some are taking to stay in the business, on page 5. (Photo by Ken Kashian)

Veto session starts with money struggles BY KAY SHIPMAN FarmWeek

State lawmakers started the fall veto session last week just as they ended the general session — grappling with funding problems. And the outlook isn’t promising. David Vaught, the governor’s new budget director, told The Associated Press the state is confronted with a $900 million hole in the current budget. He attributed that mainly to high unemployment rates that have cut income tax revenue. The state’s unemployment rate was 10 percent in August. Earlier, the Illinois Commission on Government Forecasting also projected decreases in both sales tax and income tax revenue and estimated accelerated rates of decline for both tax revenues over the rest of the fiscal year. “This new revenue shortfall further shows the dire financial situation facing Illinois,” said Kevin Semlow, director of state legislation for Illinois Farm Bureau. “This will only increase the overall deficit facing the state.” The Statehouse struggle for available

funding intensified after the House and Senate voted to restore money for lowincome college students. Thursday, hundreds of students rallied at the Capitol over the loss of Monetary Award Program (MAP) funds for the spring semester. Lawmakers then voted to provide about $200 million for the education grants, but didn’t specify how the state would pay for them. “It was extremely important that we address this issue now during the fall veto session,” said Sen. John Sullivan (DRushville), chairman of the Senate Appropriations Committee. “Students are making plans for the spring semester. They need to know their funding will be available.” Gov. Pat Quinn told the students he supported them and funding of the MAP grant program. Lawmakers tossed the issue back to the governor by noting that the state budget authorized a lump sum of discretionary funds and Quinn determined which programs to fund. In addition to budget matters, the House and Senate also took action on the

FarmWeek on the web: FarmWeekNow.com

governor’s veto message. Quinn had vetoed a bill supported by IFB, SB 1743, which would remove a requirement for employers of temporary legal immigrants to pay state unemployment insurance coverage for those employees, according to Semlow. Last week, the Senate overrode the governor’s veto with a 55-0 vote, Semlow said. SB 1743 now will be sent to the House for consideration. The Senate also passed SB 2239, which removes a new tax on businesses organized as partnerships that provide services. IFB supported the repeal of the tax, which raised the cost of services used by farmers, Semlow noted. The new tax is part of the current state budget and requires partnerships that provide such services as legal advice and accounting to pay a 1.5 percent replacement tax on top of the existing 3 percent personal income tax each partner pays. The bill will be sent to the House. Legislators will return Oct. 28-30 for the second week of the veto session.

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


FarmWeek Page 2 Monday, October 19, 2009

Quick Takes COOL DISPUTE INTENSIFIES — The Mexican government announced last week it will join Canada in moving forward with a World Trade Organization (WTO) dispute settlement process against U.S. mandatory country-of-origin labeling (COOL). Canada and Mexico together accounted for 59 percent of total U.S. beef, beef variety meat, and processed beef product export revenues last year. The National Cattlemen’s Beef Association (NCBA) is concerned the WTO cases could lead to damaging retaliatory actions against U.S. beef. NCBA continues to urge USDA to reinstate a joint Agricultural Marketing Service/Economic Research Service (ERS) study to help gain a better understanding of COOL’s effects on U.S. producers and the entire beef chain. The study was to be completed in cooperation with the Livestock Marketing Information Center, but the fiscal 2010 ag appropriations bill did not direct USDA to reinstate funding for the project. POULTRY BAN ENDING? — Conferees on the fiscal 2010 ag appropriations bill working with USDA agreed last week to language that would permit USDA to promulgate a rule allowing processed poultry or poultry product imports from China. As a condition, the secretary of agriculture first must notify Congress that certain health and safety conditions have been met. “Translation? The restriction on Chinese poultry will be lifted in about two months,” said Illinois Farm Bureau Senior Commodities Director Tamara White. The appropriations restriction has been in place for two years, fueling numerous trade tiffs between the U.S. and China. The Chinese government recently threatened to restrict U.S. imports of chicken and auto products after the Obama administration imposed punitive sanctions on Chinese tire imports. ADM BUYS OCEANGOING SHIPS — Archers Daniels Midland (ADM) Co., Decatur, announced last week it had acquired five oceangoing commodity vessels, ranging between 587 and 738 feet in length. The five carriers provide cargo-carrying capacity of between 36,000 tons and 67,000 tons. The carriers will be used to transport all types of grains, grain products, and bulk commodities to and from ports in Europe, South America, Asia, and other parts of the world. Once in operation, the five carriers will add to ADM’s transportation network that includes 1,700 barges, 58 tow boats, 29 line boats, 23,500 railcars, and 1,600 semi trailers.

(ISSN0197-6680) Vol. 37 No. 42

October 19, 2009

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 Advertising Sales Manager

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GOVERNMENT

CBO: Cap and trade would ding economy transportation,” he told FarmWeek. “Right now, they say the average load of produce in the As the U.S. Senate preps for climate hearings, U.S. travels 1,200 miles. a lead congressional analyst warns cap and trade “How much diesel fuel does that take? How would further bruise the U.S. economy. much extra is that trucker going to have to Congressional Budget Office Director Dou- charge growers to get it there, or, if you own glas Elmendorf last week warned the Senate your own truck, what’s it going to cost you? Energy and Natural Resources Committee gross “What about the fungicides, the insecticides, domestic product would drop 0.25 of a percent the rodenticides — all these things that are necto 0.75 of a percent in 2020 and 1 percent to essary to (specialty growers)? I can’t fathom 3.3 percent in 2050 what they’re under House cap-andthinking.” trade proposals. He Environmental anticipated there would ‘Right now, they say regulations be job losses, particualready have led the average load of to replacement of larly in key fossil-fuel sectors. produce in the U.S. key horticultural The Senate commitsuch as travels 1,200 miles.’ chemicals tee proposes similar the soil fumigant measures with a more — Harry Alten methyl bromide ambitious emissions with less effective president Illinois Specialty reduction timetable and formulations. Growers Association without ag-specific Alten fears chemopportunities to market ical manufacturcarbon “credits” to regulated industries. ers faced with new compliance costs could The committee’s draft “chairman’s mark” has economize by dropping “minor” crop prodbeen submitted to the U.S. Environmental Pro- ucts. tection Agency for analysis. Hearings on the Even if the Senate adopts House proposals measure tentatively will begin the week of Oct. charging USDA with developing emissions 25, with committee approval soon after. “offset” opportunities for producers and Harvard’s Harry Alten is a Northern Illinois foresters, Alten notes vegetable growers cannot vegetable grower and president of the Illinois easily establish cover crops that trap carbon in Specialty Growers Association. He is concerned the soil. about the bottom-line impact of cap and trade Because current proposals reward only new from the input manufacturer to the retail procarbon reduction/sequestration efforts, most duce department. orchardists likely would not benefit from the “At the producer level, there’s the problem of carbon market, he said.

BY MARTIN ROSS FarmWeek

IDOT reports a decrease deer-vehicle crashes in ’08 Slower driving speeds a factor? BY KAY SHIPMAN FarmWeek

Illinois drivers hit fewer deer last year in accidents reported statewide by law enforcement officials, according to the Illinois Department of Transportation (IDOT). In 2008, Illinois reported 24,212 deer-vehicle collisions, a drop of 814 accidents compared to 2007 reported accidents. “We believe motorists are slowing down, in many cases, to conserve fuel,” said Paris Ervin, IDOT communications manager. “Slower speeds give motorists more time to react and avoid these types of crashes.” Country Financial reported 9,857 deer-vehicle accident claims in Illinois last year, down from the 9,905 claims in 2007. However, the damage value was higher at $24.1 million in 2008,

compared to $23.1 million the previous year. The increase was attributed to increased costs of vehicle repairs. In addition to fewer accidents, IDOT also reported declines in the number of people injured and those who died

‘And if you see one deer cross the road, always assume there are more to follow.’ — Marc Miller director Illinois Department of Natural Resources

in deer-vehicle accidents in 2008 compared to 2007. Statewide there were two fatalities and 758 injured victims last year. In comparison, five people were killed in deer accidents and another 843 were injured in 2007. However, 2009

may be a more deadly year — four fatalities have been reported to date. Cook County, with the most motorists and roads, topped the list for the most deer-vehicle accidents. The county reported 1,008 deer-vehicle accidents far outpacing Peoria County’s 642 and Madison County’s 630 accidents. Other high-accident counties were: Pike, 617; Will, 570; Lake, 553; Kane, 524; Sangamon, 516; LaSalle, 510; and Fulton, 431. Under Illinois law, motorists are required to report all accidents resulting in damages of $500 or more to law enforcement officials. Illinois Department of Natural Resources (IDNR) Director Marc Miller reminded drivers that deer are active this time of year, especially at dusk and dawn. “And if you see one deer cross the road, always assume there are more to follow,” he warned.


FarmWeek Page 3 Monday, October 19, 2009

GOVERNMENT

Regional water supplies projected to meet future need BY KAY SHIPMAN FarmWeek

East-Central Illinois water supplies are projected to meet future demands, including agrelated development, through 2050, according to a regional water report. A water study group that issued the report also recommended further planning on a regional basis to help the area understand the potential of its water resources and prepare for the future. The study is available online at {www.rwspc.org}. “We can meet current and expected demands if we meet those demands wisely,” said Gary Clark, director of the Illinois Department of Natural Resources’ (IDNR) office of water resources. Clark was a technical adviser for the regional water study group. This summer, the

‘We have to continue to monitor and manage demands and uses wisely.’ — Gary Clark Illinois Department of Natural Resources

Mahomet Aquifer Consortium oversaw completion of water planning for 15 EastCentral Illinois counties known as the Mahomet Aquifer region. In 2006, then-Gov. Rod Blagojevich signed an executive order mandating two regional water use plans. Planning is progressing for 11 northeastern

Regional water plan covers waterfront A study for planning and management of East-Central Illinois water supplies covers 15 counties. Recommendation highlights include: • Continue regional management of water supplies to meet demands and comply with existing laws, regulations, and property rights; • Conduct planning and management through enhanced regional cooperation and by building on current efforts; and • Establish a permanent process and structure for regional water supply planning. Key findings include: • Sufficient water is available to meet current and future demands even during drought peri-

counties and is expected to be done in February. The East-Central group studied current and future water supplies, uses, and demands up to 2050. Illinois Farm Bureau has been involved with the water planning effort and has representatives on both regional groups. “People don’t think about where their water comes from as long as they turn on a spigot and it comes out. We need to change that mentality,” said Champaign County Farm Bureau manager Brad Uken, the group’s chairman. Mason County farmer Jeff Smith of Easton, the group’s vice chairman and its agriculture representative, emphasized a regional approach is needed for water planning. “We want this to be done voluntarily because every region and community is different,” said Smith, president of the Central Illinois Irrigat-

Statements sought from IFB candidates Statements of candidacy from those seeking election to the positions of president and vice president of Illinois Farm Bureau will be published in the Nov. 23 issue of FarmWeek. The statements must be no more than 300 words in length, and any copy exceeding that limit will be returned to the candidate for editing to the appropriate length. Candidates also must submit biographical information, including name, address, age, and family and farming information. That information will not be included in the 300word count. All information must be typed. A color picture also must be submitted. Information will be listed alphabetically by the candidates’ last names. Mailed statements should be sent to Dave McClelland, editor of FarmWeek, at 1701 Towanda Ave., Bloomington, IL 61701. E-mailed entries should be sent to dmcclelland@ilfb.org. Deadline for submitting statements is Nov. 9.

ed Growers Association. Not only are there differences among communities, but also differences in the aquifer as it moves from Eastern Illinois west into Mason and Tazewell counties, Smith and Uken noted. In western counties, the aquifer recharges much faster because of the sandy soils; recharge is slower in the heavier soils of eastern counties. “When the water table is high, there are spots (in western counties) where the aquifer is above ground,” Smith added. Both men stressed a need for understanding of how the aquifer works in different areas. While agricultural irri-

ods and with possible climate change if adequate infrastructure and drought contingency plans are developed and implemented and economic and environmental costs are tolerable. • Demands for water and water withdrawals will increase by 2050 in the region. The range of increases, excluding electric power generation, range from 220 million gallons per day (mgd) to 420 mgd. • Bloomington, Decatur, and Springfield will have increased water shortages during record droughts unless additional water supplies are developed and/or demand is reduced. Decatur could face possible water shortages within a single drought season. — Kay Shipman

gation uses a great deal of water in Western Illinois, much of that water flows back into the aquifer, making irrigation a sustainable use in the area, they noted. “We have (computer) models to allow and encourage appropriate development of the aquifer,” Clark said. Consensus-based study and models can show where development, including agrelated industries, should be located for minimal impact, Clark continued. “There is nothing wrong with that type of development,” he added. Soil and Water Conservation Districts (SWCD) are an essential part of water plan-

ning, which considers the whole water system, said Shannon Allen, Macon County SWCD watershed specialist and study group member. SWCDs are involved in many water- and conservationrelated programs, including well head protection. Uken, Smith, Clark, and Allen expressed hope the regional water planning process will continue. “We need all entities to come together and talk about water uses now and into the future,” Uken said. “We have to continue to monitor and manage demands and uses wisely,” Clark added.

Wind Working Group, Extension plan wind energy workshops for landowners Three wind energy workshops geared toward landowners will be offered by the Illinois Wind Working Group and the University of Illinois Extension. The first meeting will be Nov. 9 at Pitstick’s Pavilion, Ottawa, in LaSalle County. The workshops are designed to help landowners make informed decisions about wind energy developments and leases. The other workshop dates and locations are Dec. 9, at the Livingston County Extension office, Pontiac, and Jan. 7, at the public library, Freeport, in Stephenson County. Each of the workshops will begin with onsite check-in at 1 p.m., followed by the program from 1:30 to 4 p.m. University educators and industry professionals will give an overview of wind economics and energy, a timeline for a wind energy project, agricultural issues related to wind development, and lease and contract issues. “Wind energy in Illinois is going to experience explosive

growth,” said David Loomis, director of the Center for Renewable Energy at Illinois State University, Normal. “Illinois recently surpassed the 1,000 megawatt mark for wind capacity in the state, and I see no end to the projects that are coming on-line.” Stanley “Jay” Solomon, a U of I engineering technology educator, added that landowners need to consider the long-

‘Wind energy in Illinois is going to experience explosive growth.’ — David Loomis Center for Renewable Energy director

term implications before signing a contract with a developer. Landowners should consider the impacts on agriculture and future land development, including limitations on locations and construction of new buildings, aerial crop spray

applications, and practical cultivation equipment sizes. Those issues and others will be discussed at the workshops. Early registration deadline is Nov. 4 for the first meeting and the fee is $20. Registration after the deadline and at the door will be $25 based on available space at each location. Registration for the Nov. 9 meeting is available online at {http://web.extension.uiuc.ed u/Lasalle} or by calling the U of I LaSalle County Extension office at 815-433-0707. The early registration deadline is Dec. 4 for the Dec. 9 workshop in Pontiac. Online registration is available at {http://web.extension.uiuc.ed u/Livingston} or by calling the U of I Livingston County Extension office at 815-8443622. Early registration deadline is Jan. 4 for the Jan. 7 meeting in Freeport. Online registration is available at http://web.extension.uiuc.edu/Stephenson} or by calling the U of I Stephenson County Extension office at 815-235-4125.


FarmWeek Page 4 Monday, October 19, 2009

INCOME & RISK

Insurers face new costs, lower reimbursement BY MARTIN ROSS FarmWeek

With a continued budget squeeze, increased public scrutiny of the insurance industry, and a need to balance bureaucratic requirements with producer needs, crop insurers are attempting to set their own record straight. National Crop Insurance Service (NCIS) spokesman Laurie Langstraat notes growing pressure in Washington to “take a whack at (crop insurance), either on the private insurance company side or by cutting premium subsidies to farmers.” As USDA and insurers renegotiate terms of and federal compensation for offering crop policies, a new NCIS report indicates that over a 17-year period, the federal crop insurance program has been “significantly less profitable” and riskier than comparable property and casualty coverage. Industry concerns intensified after the crop insurance program — which had operated under separate legislative authority — was included in the 2008 farm bill. Insurers have enjoyed relative profitability over the past five to six years because disaster losses nationwide have been moderate, and Langstraat suggested lawmakers “could see

there was money to be taken from the program.” Insurers market policies under a standard reinsurance agreement (SRA) with USDA, receiving reimbursement for “administration and operating” (A&O) costs and a share of risk underwriting gains (as well as potential losses). The farm bill directs an anticipated $6.4 billion reduction in reimbursements, gains, and related funding over the next decade. Congress rejected an administration request for $5.2 billion in added cuts, but a new SRA must be negotiated by July 2010, and Langstraat said she is unsure “how much the government wants to take yet again from the crop insurance companies.” “We’re always up against the budget restraints,” she told FarmWeek. Industry changes over the next six to 12 months will require at least a $1 million-percompany investment in new computer systems or programming, Langstraat said. She argued forthcoming USDA “common policy” provisions that merge income protection, crop revenue coverage, and revenue assurance policies alone will “change the

way the crop insurance program looks altogether.” Given stringent checks and balances imposed by USDA, insurers faced with reduced reimbursements generally can’t trim administrative costs, she said. That means potentially

higher policy costs or less money for new risk product development, Langstraat warned. Changes in the way claims are handled have increased industry costs significantly. “Any claim over $100,000 has a mandatory review,”

Langstraat noted. “(Companies) cannot pay a claim over $100,000 without asking a producer for three years of records to verify everything. With the revenue products out there, most claims are over $100,000 any more.”

Insurers see healthy year if ‘frost bullet’ averted National Crop Insurance Service spokesman Laurie Langstraat sees 2009 being a relatively healthy financial year for the nation’s crop insurers — if producers can “dodge that early frost bullet.” Nationwide, the industry has reported roughly $8.9 billion in premiums for the 2009 crop year. While final revenue policy payouts can’t be calculated until fall prices are released, insurers this year to date have sustained an overall loss ratio of 28 cents per every dollar of premium. “Overall, losses have been pretty reasonable. We’ve had some pockets of drought and other things,” Langstraat told FarmWeek. “Premiums were down, but that’s because they’re tied to the major commodity prices, and those are down. “Last year, we were just shy of $10 billion in premium. Here, we’re just shy of $9 billion. A billion dollars is a lot, but you have to remember that commodity prices were significantly lower this year.” A new wild card in the risk management mix was the average crop revenue election (ACRE) program, which offers producer participants combined farm program production and price protections. Langstraat suggested that rather than competing with crop insurance in 2009, ACRE may have provided some growers the “peace

of mind” to comfortably forward contract a share of their crops. In fact, Ohio State University economist Carl Zulauf noted ACRE offers “different, yet complementary, revenue risk protection than crop insurance.” Revenue insurance addresses risks that occur during the pre-harvest period, while ACRE protects producers when revenue declines from one crop year to the next, Zulauf said. “(ACRE) kind of covers a lot of the price after harvest,” Illinois Farm Bureau risk management specialist Doug Yoder explained. “It’s not duplicating what crop insurance does — it really just gives you different ‘coverage’ periods. Meanwhile, the new supplemental revenue assistance program (SURE), which reportedly is almost ready for launch, will require producers to purchase crop insurance or noninsured crop protection in order to qualify for disaster assistance. Langstraat said she sees SURE potentially spurring individuals to buy higher coverage levels on existing insured acres rather than buying additional insurance. “Right now, about 78 percent of the insurable acres in the United States are insured,” she noted. “You might gain another percentage point or two, but that’s pretty good market penetration. You’re always going to have a handful of farmers who don’t see the riskreward being there for them.” — Martin Ross

‘Wastes’ offer footprint-friendly ethanol energy Corn-based biofuels look far more environmentally friendly when they’re made using cornbased power, according to University of Minnesota (U of M) scientist Doug Tiffany. Tiffany and his colleagues have evaluated the technical and economic feasibility of using corn stover and cobs and/or the “still syrup” derived from corn ethanol distillation to power and heat biofuels plants. Reducing demand for natural gas and purchased electricity — both prospectively more costly under congressionally proposed

emissions limits for utilities and key industries — reduces ethanol’s carbon “footprint” and clears the way for expanded biofuels use under tighter greenhouse gas regulations. “The engineering works out very well — we understand exactly what processes to use,” Tiffany related. “And by employing those technologies, we can improve the greenhouse gas emissions associated with ethanol production. “We can reduce them drastically and essentially make corn ethanol equivalent to sugarcane ethanol in terms of the reduction

GROWMARK director for facility operations and member projects Greg Eckhart, left, and Pete Nance, Menard Petroleum Terminal facility manager (with back to camera in red jacket), explain how fuel comes through the pipeline system during an October open house at the GROWMARK Terminal near Petersburg. GROWMARK acquired the facility in August 2008 to expand biofuels storage capacity. It offers capacity for 10 million gallons of gasoline and diesel fuel and includes a state-of-the-art biodiesel blending station. (Photo courtesy of GROWMARK)

in greenhouse gases vs. gasoline.” Because they are low in ash, cobs provide a high-quality fuel, and Tiffany reported cob harvest is easy to mechanize. However, he sees many plants being able to meet energy needs using 20 percent of a given county’s available stover. U of M scientists are working on “densification,” harvesting stover into round bales that can be compressed into 15 poundper-cubic-foot units. Beyond improving stover transportation and storage, Tiffany believes densification will provide a better product for plant heat and power. He said he sees “some merit” to the alternate concept of liquefying crop residues through pyrolysis — biomass gasification at extreme temperatures. Gasification offers greater energy efficiency and thus reported greenhouse advantages compared with straight biomass combustion. That’s given rise to talk of on-site gasification and pipelining capabilities that would enable producers to ship finished fuel to regional ethanol plants. “I think we’re a little further away from having the equipment to do that,” Tiffany said. “But it’s an active area, and you’ll see some progress.” — Martin Ross

Biodiesel Continued from page 1 in soybeans, reducing diesel fuel use; energy gains from biotech soybeans that require fewer pesticides to produce; and rising per-acre bean yields and soy oil extraction rates. For every 1 percent increase in bean yields, soy biodiesel’s fossil energy ratio improves by 0.45 of a percent, scientists estimate. The new biodiesel analysis is more comprehensive than earlier USDA-DOE calculations. Researchers found energy use for soybean lime application, farm machinery, soy oil transportation, and biodiesel plant construction had no significant impact on total energy balance.


FarmWeek Page 5 Monday, October 19, 2009

LIVESTOCK ‘Pain continues’ in pork industry

Some producers reorganize while others sell out

BY DANIEL GRANT FarmWeek

The ongoing financial crisis in the pork industry is forcing more and more producers in Illinois to either reorganize their operations or sell out. Jim Kaitschuk, executive director of the Illinois Pork Producers Association (IPPA), told FarmWeek he knows of producers who recently completed or

FarmWeekNow.com Listen to Mark Blindt discuss why he left pork production this fall at FarmWeekNow.com.

are in the process of filing for bankruptcy and reorganizing and those who have filed for bankruptcy and exited the business. Others simply have sold out or are in the midst of selling out, he said. “The pain continues, unfortunately,” Kaitschuk said. “There has been some

reduction (of the state’s herd) for sure.” USDA in its September hogs and pigs report estimated the number of market hogs in Illinois declined 4 percent (140,000 head) compared to last year while the breeding herd shrunk by 2 percent (10,000 head). “These are some of the most challenging times we’ve ever seen in the pork industry,” said Philip Nelson, Illinois Farm Bureau President and LaSalle County pork producer. Nelson recently noted he is losing about $6,000 on every load of hogs shipped from his family farm. And the situation could get worse before it gets better. Chris Hurt, Purdue University Extension economist, recently estimated losses in the pork industry could continue for another six months, although the magnitude of the losses is projected to decline over time. “I’m not sure how much longer people can withstand this,” said

Kaitschuk, who noted the reduction of the herd has prompted a tremendous decline in revenue at IPPA. “Frankly, I’m surprised some people have made it this long.” Mark Blindt, a Warren County farmer who raised hogs for 38 years and specialized in feeder pigs, sold his last load of animals on Sept. 25. Blindt said the decision to exit the business was prompted by low hog prices, high input costs, and a loss of a market for his animals. Given those factors, he said he could not justify needed updates to his facilities. “When you’ve got sows on a schedule to farrow, you have to keep moving pigs through the facility regardless of price,” said Blindt, who farrowed 160 litters per year. “What got frustrating is when we couldn’t find a home for the pigs.” Blindt still maintains a herd of Angus beef cattle and he grows corn and soybeans.

But he’s concerned pork production is moving out of his county and possibly the state. “There’s only a handful of people in the county producing hogs anymore,” he said. “It makes you wonder who is going to raise the hogs” to meet future demand. Steve McLaughlin, who along with his brother, Mike, recently closed their farrow-to-finish operation in McLean County and reorganized to enter contract production, also is concerned the loss of animals in the state could affect grain markets. “As a grain producer, (the hog industry) is one of the largest consumers of our product,” McLaughlin said. “We really need the livestock industry.” Market hogs each year in Illinois consume more than 94 million bushels of corn and 28 million bushels of soybeans, according to IPPA.

More pork producers are moving to contract production Brothers Steve and Mike McLaughlin of LeRoy months ago could see the writing on the wall when it came to their farrow-to-finish hog operation. “With this much uncertainty (in hog and input prices), it’s pretty tough when you can’t write a business plan that can show a profit,” Steve McLaughlin told FarmWeek. The McLaughlins, therefore, decided to exit the farrow-to-finish business. However, unlike some producers who may be out of the industry for good, the McLaughlins found an opportunity to modify their buildings and finish pigs for Carlyle-based The Maschhoffs, one of the largest familyowned pork production networks in North America. “I’ll provide the buildings and labor and they’ll provide inputs and feed,” Steve McLaughlin said. “That reduces our risk.” In Knox County, Jared

Higgerson and brothers Aaron and Nathan Link this summer opened a new 3,600 head wean-to-finish swine production facility near Galesburg. They also found the opportunity through contract production with The Maschhoffs. “We wanted to continue farming and raising hogs and figured this was the only way we could make that happen,” Higgerson previously told FarmWeek. Jim Kaitschuck, executive director of the Illinois Pork Producers Association, said a move to more contract production has been an “ongoing trend” in the state. The USDA September hogs and pigs report showed the total number of hogs under contract owned by operations with more than 5,000 head, but raised by contractees, accounted for 46 percent of the total U.S. hog inventory compared to 43 percent a year ago.

Central Illinois FFA team wins World Forage Management Cup A three-member FFA team from Prairie Central High School, Fairbury, recently won the 22nd annual World Forage Management Cup at the World Dairy Expo in Madison, Wis. They topped 55 other student teams. Winning team members were Katie Schaffer, Tim Hartman, and Abram Zehr. Each placed in the top 10 among 165 competitors. The team will receive a $250 scholarship. Schaffer also placed first overall with the highest individual score and will receive a new laptop computer. School ag instructors and FFA advisers are Greg Niewold, Darren Ropp, and Kyle Miller. The contest is designed to increase participants’ knowledge of forage production and use. Ag clubs and teams of high school age students from the U.S. and Canada were eligible.

Julie Maschhoff, vice president of public relations for The Maschhoffs, said her organization’s business model is built for the long haul in the industry due to its conservative nature and attention to details. The Maschhoffs are production partners with 300 family farmers in the Midwest.

“We’ve always focused on strong production performance, and we continue to do that,” Maschhoff said. “But what’s made the difference the last two years is our marketing and hedging strategies. “We’re willing to lock in small, small profits that normally you might not want to,” she continued. That way

“we’re still able to invest in our business long-term.” The Maschhoffs currently are constructing a $14 million feed mill in Griggsville. “We manage risk very conservatively,” Maschhoff added. “I think that strategy will get us through the next six months to year” until profits return to the industry. — Daniel Grant


FarmWeek Page 6 Monday, October 19, 2009

CROPWATCHERS Bernie Walsh, Durand, Winnebago County: More of the same here with rainy days and cold nights. We had 27 degrees last Saturday morning (Oct. 10), and 25 degrees on Sunday morning. Luckily, our beans were ready for a freeze, and our corn is black layered, but very wet. That is going to mean very wet corn and light test weights. We were able to combine beans last week for one day. Yields are pretty good, considering everything that has happened with the weather this summer. Some neighbors are trying to combine corn and most of it is over 30 percent moisture. Leroy Getz, Savanna, Carroll County: Freezing temperatures in the mid- to low 20s for 12 hours on Oct. 10 and 11 killed all vegetation. We had snow flurries on Oct. 10. Harvest has been very slow. Corn moisture levels are still very high and not drying out. The low test weights in the upper 40-pound range seem to follow certain hybrids. Rain for the week of 0.6 of an inch. October rainfall total, 2.65 inches. Ron Frieders, Waterman, DeKalb County: No harvest. Lots of rainy days and several hard freezes. Earlier in the week, we hand-sampled the first-planted corn, and it is still above 30 percent moisture. I heard a report that someone tried to combine beans and they were 19 percent. Pray for good weather. Larry Hummel, Dixon, Lee County: “Not much” pretty well sums up the amount of harvest activity that has occurred here in Lee County. One neighbor got a few soybeans picked on Tuesday. The moisture was 17 percent when he started and dropped to 14 percent by quitting time. The field average was 46 bushels, but it had some drowned out spots that pulled the average down. We started picking corn on Tuesday. Moisture is running right around 35 percent and the field average is at 230 bushels. Our grain dryer is getting a workout, but I’m thinking that moisture levels won’t be dropping much this late in the year, so we might as well get started. Ken Reinhardt, Seaton, Mercer County: There was persistent light rain during the week. Some soybeans were harvested Monday (Oct. 12) with moisture at 14 percent and up. Yields are good other than where sudden death or white mold were bad. The late beans that froze are looking awful. Corn harvest is just crawling with all but short-season hybrids around 30 percent or more. The LP fuel guys are already getting run ragged with the dryers that are going. Harvest is a month behind and, according to WGN’s weather blog, the current conditions are five weeks ahead of normal. Ron Moore, Roseville, Warren County: We received another inch of rain last week. There was very little harvest work done. No soybeans have been harvested in the last two weeks. The corn that we planted in April has all been harvested and what we have left was planted in May. The moisture is still running at 30 percent or higher. The weather forecast is for some dry conditions for this week. Hopefully, we can get some beans harvested. No fertilizer has been applied yet. Mark Kerber, Chatsworth, Livingston County: Rain and record cold temperatures dominated the weather and delayed harvest another week. Hopefully, by the time you read this, we will be working many long hours a day. We did combine corn one day last week. The moisture level was 27 percent on 105-day corn. It looks as though once corn gets down to 25 percent, it will be considered dry corn. Markets have responded some to harvest delays.

Tim Green, Wyoming, Stark County: Finally got started picking corn Tuesday afternoon. Kind of disappointed — moisture was in the 31- to 32-percent range for 104-day corn. I had early corn sold for the first half of October, so I went ahead and picked it. A lot of people are having that dilemma in this area. Elevators are talking about raising their charges because they are getting so much corn that is 35 percent and above. A few beans have been cut. They all have been in that 14, 15, 16 percent range. People are putting them in bins to get them to dry down. Just a very small percentage of corn has been picked. Many are waiting for it to dry down. The corn seems to be pretty decent yield-wise, but I think we are going to eat all that up with our drying bill. A little disease is showing up on the end of the ears, which has us a little concerned. Ron Haase, Gilman, Iroquois County: Harvest has been at a standstill due to the wet and cool weather. Very few acres have been taken out. Crops and fields have not been able to dry out. The frost brought an end of life to the crops that were not already mature. With all of the corn having higher moisture content, it looks to be a long, drawn out harvest as corn harvest will have to match local drying capacity. If moisture content stays at 25 percent or above, the drying capacity will be reduced quite a bit vs. a 20 percent or lower moisture content. With all the high input prices invested in this crop, the high cost of drying is going to greatly reduce the chance of profitability. Local closing prices for Oct. 15 were: nearby corn, $3.47; December corn, $3.54; nearby soybeans, $9.79. Brian Schaumburg, Chenoa, McLean County: An inch of rain halted fieldwork after the 13th. Drying capacities are shrunk to one-third of normal due to high moisture. Some corn has mid-20 percent moisture, but most is 30-plus. Drying costs may average more than $100 per acre. Corn, $3.60, $3.72 January, $3.73 fall 2010; beans, $9.68 fall/January, $9.38 fall 2010; wheat, $4.47. Steve Ayers, Champaign, Champaign County: Last week we set a new record for the slowest U.S. harvest progress for both corn and soybeans. Nothing to celebrate, though! Drizzle and rain throughout the week totaled 0.7 of an inch and combines did not move for another week. We have hundreds of acres of soybeans ready when it does dry out. Frost nipped us a little bit last weekend (Oct. 10-11) and looked as though there was another chance for frost on the pumpkin during the weekend. Thursday we had a 2-degree range from low temp to high fro the day, from 41 to 43 degrees. This is 22 degrees below normal high, so the cool, wet year continues. With no heat or sun, corn is not drying down. This week has temperatures expected to range from 40 to 65 degrees, but rain is expected to move in again Wednesday. Hang in there! Wilfred Dittmer, Quincy, Adams County: Maybe it is going to rain for another 40 days. Who knows as it sure cannot seem to stop and let this harvest get in gear. Our gauge picked up another inch last week and some areas received much more, so most machinery was parked all week. Not only has it been rainy most days, I don’t think any of us knows what the sun looks like anymore. Oh well, one of these days it will change and all fields will be ready at once. Have a safe and productive week. Jimmy Ayers, Rochester, Sangamon County: We received another inch and a half of rain Tuesday to Friday. Beans look like they are ready to go. If the moisture drops and some sun shines, there will be a lot of beans cut. A few are shelling corn, but for most of the week we were shut down. I guess it is a time to reflect and make sure that you are ready when the time comes. We are holding on at 20 to 28 moisture on corn. Markets are on a rollercoaster, as normal. Be safe and remember your family and friends need you.

Harry Schirding, Petersburg, Menard County: Rainfall last week, 1.55 inches. Total rainfall for October, 4.33 inches. Normal rainfall for October, 2.6 inches. We wait for crops and fields to dry up. The fields firmed up enough Monday and Tuesday (Oct. 12-13) to allow harvest, although conditions were less than ideal. Long lines at the elevator and long drives in the field with the combine likely will be the norm. A dry forecast for the early part of this week has everyone planning how to best use their time. Most remain optimistic that we can complete harvest and put away what appears to be a good crop. We are just not sure what our fields will look like when we get done. Corn nearby, $3.55, up 10 cents; soybeans nearby, $9.70, up 41 cents; corn for January $3.54, up 10 cents; soybeans for January $9.83, up 50 cents. Tom Ritter, Blue Mound, Macon County: It was a cool, dreary week with little progress made in the fields. We’re trying to dry down the crops. With more than 3 inches of rain two weeks ago, we had another 1.4 inches of rain last week. The 3 inches settled pretty quick and farmers were able to get in the fields early in the week. A few people even harvesting soybeans, but they are around 15 percent moisture. Corn harvest has also been very slow. Everyone is out of their drier corn. We returned to one cornfield we had started 10 days ago at 30 percent and the moisture was still 29 percent. Yields, however, have been very good, but it has been difficult to get crops, especially soybeans, out of the field with the days getting shorter. Todd Easton, Charleston, Coles County: A couple more illtimed rain showers came into the area last week slowing harvest progress once again. We received more than 1 inch in most areas on top of already muddy fields making a bad situation worse. Soybean harvesting has progressed to more than a third done in most parts of the county with yields still in the 50s and 60s for the most part. Corn harvest has been curtailed because most everyone is concentrating on soybean harvest. I finally took the end rows off some of my Memorial Day weekendplanted corn Thursday afternoon and the moisture at 26 percent was a little higher than I was hoping. That may be what we harvest a lot of the corn at the way this year is going. Yield on the end rows was 192 bushels dry, which surprised me after seeing so much compaction damage about everywhere the planter turned around. Doug Uphoff, Shelbyville, Shelby County: A note from local elevator manager Kevin Walker in Bethany explains the predicament we are facing this year. Considering every farmer can harvest at the least 1,400 bushels of corn per hour in a 10-hour day things are not shaping up for a timely harvest. My thoughts are I will be able to get about 90,000 through the dryer by Monday morning (Oct. 19). It appears that currently we are getting about 1,400 bushel per hour through our dryer at an average of 25 percent moisture, so my goal will be to try to keep enough corn to keep the dryer running. We will do everything within our power to get the corn dried and put away as timely as possible; however, you are going to have to be patient because it is going to take a lot of time. You should probably expect that corn hours are going to be shorter than normal and we actually will have to be closed some days just to catch up. If corn moistures do not decline, I will be able to handle and dry about 250,000 bushels of corn a week. Cash prices are as follows: cash corn until Tuesday, $3.60; fall corn, $3.62; January 2010, $3.80; fall beans, $9.88; January 2010, $9.42; fall 2010 wheat, $3.95. David Schaal, St. Peter, Fayette County: It was a cool, wet week here with almost six inches of rain. Temperatures have struggled to reach 50 degrees. We had mud in the spring and appears we will have mud in the fall. Still not a lot of harvest being done in the area, mainly due to weather conditions. There are many soybean acres that will be ready to combine when weather conditions permit. Wheat sowing could be slim to none. We’re hoping for warmer drier weather.


FarmWeek Page 7 Monday, October 19, 2009

CROPWATCHERS Ted Kuebrich, Jerseyville, Jersey County: It was another rainy week in Jersey County with a total of 0.7 of an inch of rain. With all the rain we’ve been getting, the farmer in Jersey County has had very little time to get any harvesting done. There were a couple of combines in fields on higher ground the first part of last week shelling corn. There are a lot of corn and beans standing in water along creeks that overflowed two weeks ago. October corn, $3.63; January corn, $3.63; June corn 2010 $3.86; October beans, $9.96; January beans, $9.92; June beans 2010, $9.61. Kevin Raber, Browns, Wabash County: Not many days fit for harvest this past week. Rainfall amounts from Wednesday and Thursday were between 1 and 2 inches and it already was muddy. Most corn seems to be standing well. The wet, rainy, overcast skies haven’t helped the beans to dry down. Very little wheat has been sown, and I don’t know how well it will do in the saturated, cold ground.

Rick Corners, Centralia, Jefferson County: Another week of sitting on our fanny. We had another two inches of rain Wednesday and Thursday. With 99 percent of the crop still in the field in this area, this is about to get serious.

Dan Meinhart, Montrose, Jasper County: It rained almost every day last week leaving various amounts. Our gauge showed 1.5 inches and it was still raining Friday. The highs for the week were in the 40s and the lows in the 30s, although there has been no frost damage as of yet. Very little or no corn has been harvested. Moisture in the corn is running very high. No silage chopping has taken place due to high moisture content and wet ground. A lot of soybeans are still very green. No wheat went into the ground last week and what has been planted has not emerged. We are hoping for a break from the rain the first part of this week with a warming trend. Harvest is running four to six weeks behind, just like the planting did last spring.

Dean Shields, Murphysboro, Jackson County: Last week when I reported it was raining, we got about 4.5 inches of rain by Saturday morning, and we’ve had another inch to inch and half since then, so Jackson County is pretty wet. Not much harvesting has been going on. There was some corn picking in between the showers and hardly any beans have been harvested. So, it was a week of lying back and waiting on the weather to straighten up so we can do something. Some wheat was sown before this big rain. It’s up a little bit, but I think the rain has put a halt to anymore wheat being sown for quite awhile now. We are little concerned about whether we will get to our wheat at all this fall. Time will tell. Take care during harvest.

Reports received Friday morning.

Frost damage could be minimal in majority of fields BY DANIEL GRANT FarmWeek

A killing frost that affected parts of the state last week, particularly in Northern Illinois, could take as much as 15 to 20 percent off the top end of yields in a limited number of fields. However, the majority of corn and soybean fields in Northern Illinois should be safe from frost damage, according to Jim Morrison, University of Illinois Exten-

sion crop systems specialist in Rockford. “It certainly was cold enough to bring corn and soybean growth to a halt,” Morrison said. “It will be more questionable if it was cold enough to kill alfalfa.” Morrison last week estimated harvest in Northern Illinois was just 10 percent complete for soybeans and less than 5 percent complete for corn. However, an estimated 80 to 85 percent of fields were mature enough last week that there

should be either no yield loss or less than a 5 percent loss, he said. “I think the majority of corn was safe from frost or the impact on yields is not going to be great,” Morrison said. “There were a few very late-planted fields where the corn was at half milk-line” that could sustain yield losses as high as 15 to 20 percent. Morrison was less concerned about the impact of the frost on the soybean crop. He said soy plants in many fields already

were naturally dropping leaves. The bigger concern for some farmers this fall may be high moisture levels in corn. “Harvest is going to be a long process this year,” Morrison said. “We’re dealing with corn at harvest that’s higher in moisture than we’re accustomed to.” Corn harvest in the state as of the first of last week was just 6 percent complete, compared to the average of 56 percent, while soybean harvest was 10 percent complete, compared to the aver-

age of 64 percent, the National Agricultural Statistics Service reported. Meanwhile, moisture levels last week hovered in the 26- to 28-percent range in the northern half of Illinois, Morrison said. “I think some farmers (hoping for corn to dry down in the field) are looking at the fact that it’s mid-October and they need to start getting some of the corn out of the field,” Morrison said. Drying capacity, therefore, will be at a premium, he added.

Where can you find DDGs? Website has the answer Livestock producers looking to supplement feed rations have numerous opportunities to use a variety of coproducts in Illinois. Dave Seibert, University of Illinois animal systems educator at the East Peoria Extension office, recently updated a contact list of 41 facilities in Illinois or within 50 miles of the state that sell co-products. “Co-products have been very plentiful, and price-wise they’re reasonable,” Seibert told FarmWeek. The list of co-products can be viewed online at {http://web.extension.uiuc.edu /eastpeoriacenter/anisci.html }. Two plants no longer listed on the website either changed hands or went out of business, while two new ethanol facilities (Big River Resources in Galva and One Earth Energy in Gibson City) were added to contact list. Co-products such as distillers dried grains, corn gluten, and soy hulls, can be used to reduce costs and to supplement feed rations. “This year, it’s been tough getting hay up (due to wet conditions),” Seibert said. “And the nutritional value of the hay supply is not as good as it has been in the past.” Livestock producers, there-

fore, should obtain a nutritional analysis of their hay, and if they need a supplement they may want to consider using a coproduct. More livestock producers are learning to incorporate co-products in feed rations to reduce costs. Producers also have learned how to store co-products for longer periods of time to take advantage of seasonal pricing

opportunities, according to Seibert.

FarmWeekNow.com View the online directory of coproduct providers across Illinois at FarmWeekNow.com.

The price of co-products generally tends to be lower during the summer/fall grazing season and then it often increases in

BY JEFF BUNTING

I hope by the time this article comes out you’re too busy harvesting to read it. Early harvest reports indicate higherthan-expected yields from April-planted crops. It’s amazing what genetics can do, given the challenging year. The big question now is how long will it take to harvest. Frost was observed over a good portion of Illinois the second weekend in October. What will this do to the corn crop that is 94 percent in the dent stage and only 56 percent mature, according to the Oct. 13 Illinois Crop and Progress Report? The big concern now is not maturity, but how long can we can expect it to stand in the field. If you don’t know where the milk line (the moisture line observed in the kernel) was when those below-freezing temper-

the winter when more cattle are in feedlots, the animal systems educator said. Producers who want to compare costs and quality of different co-products soon will be able to use a cost-of-feedstuffs calculator that should be available by the end of the month online at {www.farmdoc.uiuc.edu}. The new program will provide an analysis of different coproducts in Illinois, with infor-

atures were observed, it’s much more difficult to know the true effects. Stalk issues could be a concern because these plants are attached to a very shallow root system due to the conditions at planting. Another concern is the effect on dry down of the grain. This will cause lower test weights since the internal composition of the kernel (starch) could be low, resulting in varying kernel size and/or irregularly shaped kernels. Keep an eye on your fields, and if you see standability issues or ears dropping, consider combining that field. If you have questions, your local FS crop specialist has the knowledge and resources to help you find answers. This growing season has been the perfect environment for disease in both corn and soybeans with a significant amount of corn ear rots, mostly Diplodia. Keep track of those fields and plan on addressing this with

mation such as protein and energy levels, and it will account for factors such as transportation costs. “Producers can use this costof-feedstuffs calculator to determine the best buy,” for their operation, Seibert said. The Illinois Corn Marketing Board funded a large portion of the cost to develop the new feed-cost program, Seibert added. — Daniel Grant

your FS crop specialist when making corn hybrid selections for 2010. Factors to consider are hybrid selection, crop rotation, and tillage practices. A lot of the damage has been seen in early-planted corn, but remember, that’s what is being harvested now. It will be important to note the severity in both early- and late-planted fields to plan for next year. Soybeans seem to be in pretty good shape following the cold weekend in October, except for those double-crop soybeans in Southern Illinois. Early harvest reports have been good for soybeans. When weather allows, set your combine correctly to avoid harvest losses. Jeff Bunting is GROWMARK’s seed corn product manager. His e-mail address is jbunting@growmark.com.


FarmWeek Page 8 Monday, October 19, 2009

PRODUCTION

Harvest fortunes will have big impact on price direction BY DANIEL GRANT FarmWeek

Crop prices likely will remain highly volatile in coming months as the weather and its impact on the remainder of harvest will have a large influence on actual production numbers. Bob Wisner, Iowa State University Extension economist, believes crop prices could rally late this fall or early winter if crop production doesn’t meet expectations. Prices in coming months above $4 per bushel for corn and $10 per bushel for beans are not out of the question, Wisner told FarmWeek last week at the American Farm Bureau Federation commodity

outlook conference in Albuquerque, N.M. USDA earlier this month projected U.S. crop production would be the largest for soybeans and second-largest for corn on record. And most of the time when USDA increases its yield projections from August to October, it increases its final production numbers in January, the economist said. “The big difference this year is the late development of the crop and frost damage,” Wisner said. “The frost (in recent weeks around the Midwest) leads me to believe the corn crop could be down 100 million to 200 million bushels while soybean (production) may experience a 30-million to

40-millionbushel drop.” The economist also believes USDA may have underestimated crop demand and Bob Wisner that more favorable margins for ethanol production and increased exports could tighten the supply of corn and beans. The tight supply situation also could be magnified by a short crop this past season in South America. Corn production from 2008 to 2009 in South America declined by 669 million bushels while soybean produc-

tion dropped by 522 million bushels. Meanwhile, corn production declined by 177 million bushels in Russia and 240 million bushels in the European Union, Wisner reported. “That indicates our competition from world markets may be substantially less than last year,” he said. However, if harvest conditions finally improve and production is high, prices could trend lower this fall. “The basis is unusually strong across much of the Midwest,” Wisner said. “But if we get two to three weeks of good harvest weather, we could see some softening of prices and a weakening of the basis.”

‘Our competition from world markets may be substantially less than last year.’ — Bob Wisner Iowa State University

If crop production meets or surpasses current USDA expectations, Wisner believes prices could sink to the low-$3 range for corn and $8 or below for beans.

Frost danger to grazing livestock Livestock producers in areas where temperatures recently dipped below freezing should be cautious when grazing cattle on crops in the sorghum family. Plants in that family, such as sudangrass, sorghumsudangrass hybrids, and grain/forage sorghum, produce a glucoside after a frost that breaks down and releases a toxin called prussic acid. “Intake of high levels (of prussic acid) may be lethal to cattle,” said Dave Fischer, University of Illinois Extension dairy educator. Signs of prussic acid poisoning include rapid pulse, labored breathing, and eventual suffocation. Livestock producers should move cattle away from grazing these forages for several days following a frost. “If the crop was safe to graze prior to frost, it will be safe to graze three to five days following the frost,” Fisher said. “Sudangrass should be greater than 18 inches tall or sorghum-sudangrass greater than 24 inches before it is safe to graze under any conditions.” Baling or ensiling the sorghum-related crops after a frost is safe because the acid breaks down during the harvest process, the educator noted. Grazing alfalfa, clover, or other perennial forages is not a concern following frost because those crops do not produce toxins after a frost and can be safely grazed or baled and fed to livestock, Fischer added.


FarmWeek Page 9 Monday, October 19, 2009

FEEDING THE WORLD

Soy a solution as global hunger intensifies BY MARTIN ROSS FarmWeek

U.S. soybean producers are well positioned not only to feed the world’s hungry but also to fuel global economic recovery and, potentially, help protect the planet. According to a United Nations Food and Agriculture Organization (FAO) report released last week, a record 1.02 billion people worldwide face

‘ We can help (African compan i e s ) a c h i eve a lower cost of production, they’ll sell more, and people will eat better.’ — Jim Hershey WISHH

serious hunger and/or malnutrition issues. FAO cited 20 countries in Africa alone that currently require emergency food aid. In many African nations, hunger has cut heavily into school attendance and medical care as families struggle to provide children even a single daily meal. “Soy can be part of the solution,” argued Jim Hershey, executive director with the World Initiative for Soy in Human Health (WISHH). Hershey told FarmWeek the growing hunger problem is “largely a function of the (global) economic slowdown,” noting soy protein is cheaper than dairy or meat protein in many developing regions. “Africa is deficient in protein: They don’t grow enough

soy; they don’t grow enough meat, milk, and eggs,” he said. “But that creates opportunities, if we can introduce to their food processing companies the ability to use soy to stretch animal resources by putting soy with meat products. Many African companies are very interested in that technology. “We can help lower the cost of sausages and meat — things African companies are targeting at the lower-income folks. We can help them achieve a lower cost of production, they’ll sell more, and people will eat better.” The need for African ag development, rather than direct aid, was the key focus of the FAO report. Hershey noted introduction of soy has fueled African development in the form of soy restaurants offering “economical but very nutritional meals.” Soy protein also can be blended with corn or other staples to build demand for locally grown crops. Because textured soy protein is precooked, soy food preparation often takes far less time than cooking beans or other indigenous foodstuffs. That conserves wood, a major source of African fuel, in areas where kindling is expensive or deforestation is a serious issue. Further, a Kenyan school nutrition program supported by WISHH and the University of Illinois’ National Soybean Research Laboratory uses soy not only to feed 600-plus children and encourage school attendance, but also to reduce illegal wildlife poaching by economically strapped families. A lack of protein “stunts (children) both physically and mentality,” noted Northern Illi-

FROM THE COUNTIES

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UREAU — Bureau, Henry, Knox, and Stark County Farm Bureaus, the University of Illinois Extension, and Black Hawk East (BHE) will sponsor a series of three equine seminars from 6:30 to 8:30 p.m. Thursdays, Nov. 5, 12, and 19, in the Black Hawk East ag arena. There is no charge for 4-H and FFA members and BHE students. Cost for others is $9 per session or $20 for all three sessions. Call the Farm Bureau office at 309-937-2411 for reservations or more information. OCK ISLAND — The Rock Island County Farm Bureau Foundation will sponsor its Harvest Gala

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fundraiser at 6 p.m. Friday, Nov. 6, at the iWireless Center, Moline. Darryl and Karen Anderson, will present the program on their experience with Agriculture in the Classroom. A silent and live auction will be held. Donated items for the auctions will be accepted. Tickets are $50 per person, which includes reserved parking, and must be purchased by Thursday, Oct. 29. Call the Farm Bureau office at 309-736-7432 for reservations or more information. “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 manager.

nois producer and WISHH Treasurer Pat Dumoulin, who recently toured Kenya and South Africa. Dumoulin witnessed the impact of soy nutrition on children at a Kenya school where

soy “porridge” was served. “Those little ones were jumping around, and they had a little twinkle in their eye, where before they were much more sober,” she related. “They had

some energy after they’d eaten. It was the protein. “Some of those little ones would walk as far as four miles to get to school. The big incentive, of course, was that meal.”

School children in Kenya are careful not to spill a drop of the soy milk that is part of a unique school feeding program that also benefits local wildlife protection efforts. The Masai Mara School Lunch Program is using defatted soy flour to feed more than 600 children in two schools. Initiated this year, the program is supported by the National Soybean Research Laboratory and the checkoff-supported World Initiative for Soy in Human Health (WISHH). (Photo by Pat Dumoulin)


FarmWeek Page 10 Monday, October 19, 2009

PROFITABILITY

Natural air drying: Break the rules, and you’ll pay dearly BY RANDY HOLTHAUS

This year’s harvest promises another rough ride. Panic decisions are being made to deal with a wet crop and keep the harvest moving. Most panic buyers seem intent on using natural air/low temp drying Randy Holthaus to add capacity and stay ahead of the game. This technique depends on several important variables, including: • Weather – Since little or no heat is used to control relative humidity. • Airflow – Must be at

proper levels to dry the grain before spoilage begins. • Grain moisture content – Must have allowable storage time longer than the drying time. Even properly designed and operated systems risk spoilage in unfavorable weather. • Amount of heat used – Too much heat will over-dry the grain. There are hard and fast rules with this practice; break them and you will be sorry. First, verify your airflow. Adequate airflow is the key to success (see airflow chart). Use the airflow rating charts for your specific model of fan(s) and check the static pressure to assure you have adequate airflow. Monitor grain depth closely,

as it is the only way to effectively control the airflow. More grain can be added as the previous grain has been dried. Drying progress can be verified by using a small diameter rod to probe the grain to find the location of the drying front. Only your cleanest grain should be put in a natural air/low temp drying bin. Use a grain spreader to evenly distribute fines and level grain. The grain must be level and kept level or the more shallow grain will dry faster. And remember, low temp means less than 10 degrees total heat rise. Ideal drying conditions occur between 60 – 70 percent relative humidity and 30 to 50 degrees Fahrenheit.

Supplemental heat is needed only when relative humidity exceeds 70 percent (see equilibrium chart). A 20-degree heat rise cuts relative humidity by 50 percent and would severely over-dry grain. Over-drying and the resulting volume shrinkage can create a void under the wet grain above it and can cause grain bin walls to buckle and fail.

Natural air/low temp drying is a good way to add alternate drying capacity, but it does require extremely good management in challenging conditions. Contact your local FS grain system specialist for more information. Randy Holthaus is GROWMARK’s grain systems marketing manager. His e-mail address is rholthaus@growmark.com.

Economic improvement, weak dollar could benefit agriculture BY DANIEL GRANT FarmWeek

The economy in recent weeks has shown signs of improvement, and agriculture could be a beneficiary of the slightly brighter outlook. “The contraction phase (of the recession) probably is over,” said Robert Dieli, president of RDLB Inc., an economic research and management consulting Robert Dieli firm based in Lombard. “But the process of recovery will be difficult.” Some positive economic signs occurred last week when the Dow Jones Industrial average surpassed 10,000 for the first time in a year while new jobless claims (531,500 for the most recent four-week average) dropped to the lowest

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 $15.00-$34.09 $28.09 $29.00-$35.10 $34.25 n/a n/a This Week Last Week 21,529 20,100 *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 $48.26 $46.73 $35.71 $34.58

Change 1.53 1.13

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

This week 81.90 81.24

Prv. week 81.71 81.86

CME feeder cattle index — 600-800 Lbs. This is a composite price of feeder cattle transactions in 27 states. (Prices $ per hundredweight) This week Prev. week Change 93.59 93.55 0.04

Lamb prices Confirmed lamb and sheep sales This week 989 Last week 1,056 Last year 804 Wooled Slaughter Lambs: Choice and Prime 2-3: 90-110 lbs, $92-$98; 110-130 lbs., $91. Good and Choice 1-2: 60-90 lbs., $105. Slaughter Ewes: Utility and Good 1-3: $28-$31. Cull and Utility 1-2: $28.

Export inspections (Million bushels)

said. It’s not that people are eating less but they’re not eating out as often or eating as many high-value meat cuts, he added. However, the fact that the

FarmWeekNow.com Listen to Robert Dieli’s comments on how the weak dollar can help ag exports at FarmWeekNow.com.

dollar has declined 14 percent since March could be a boost to U.S. agriculture in two ways. “Going forward, the lower value of the dollar should help spur exports in general, including ag exports,” Dieli said. “And it should curb purchases of foreign goods” entering the U.S. Economists at the AFBF conference predicted crop prices could rally this winter while cattle, hog, and milk prices were projected to post slight increases in 2010.

Illinois receives $435,000 in specialty crop grants

Change 0.19 -0.62

Week ending Soybeans Wheat 10-08-09 14.7 17.8 10-01-09 13.5 22.3 Last year 17.7 24.6 Season total 54.5 313.0 Previous season total 52.9 483.6 USDA projected total 1305 900 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

level since January. Meanwhile, the gross domestic product for the third quarter is expected to be positive, according to Dieli, as the cash for clunkers program could be a “one shot wonder” to the economy. There also is an estimated $519 billion of the $787 billion economic stimulus money left to be spent and infused back into the economy, Dieli noted. The economic improvements could boost consumer demand for a variety of goods. But Dieli, who spoke last week at the American Farm Bureau Federation (AFBF) commodity outlook conference in Albuquerque, N.M., warned it probably will take months and possibly years before employment rates and the economy return to previous levels. “Like it or not, ag goods have income sensitivity and price sensitivity, and consumer incomes are under pressure,” he

Corn 20.5 46.2 31.5 211.3 198.1 2150

Illinois will receive more than $435,000 through USDA’s specialty crop block grant program, and 28 projects will share the funding, the Illinois Department of Agriculture announced last week. “The purpose of these grants is to encourage additional local food production by creating markets for fresh fruits and vegetables,” said Agriculture Director Tom Jennings. Illinois is the nation’s largest producer of pumpkins and ranks among the top 10 states in production of other specialty crops such as asparagus, cauliflower, green peas and lima beans. Statewide, more than 117,000 Illinois acres are planted in specialty crops that generate

about $137 million in sales. Grant recipients and projects include: Belleville Main Street, $10,000, farm-totable educational program for parents and students; Clinton Chamber of Commerce, $6,500, fourth grade family nutrition program; and Eckert Orchards Inc., Belleville, $20,000, development of new apple cultivars for the Midwest. Other recipients include: Illinois Specialty Growers Association, $20,000, annual growers’ conference; Illinois Stewardship Alliance, $10,000, identify and create promotional materials for local specialty crop food system in Central Illinois; and the City of Urbana, $15,000, an “Eat Here” promotion at local farmers’ market.


FarmWeek Page 11 Monday, October 19, 2009

PROFITABILITY Corn Strategy

C A S H S T R AT E G I S T

Cents per bu.

 2 0 0 8 c r o p : G ive n t h e extent of the recent rally, it’s less lucrative to hold old-crop corn until after harvest. Even if it’s stored commercially and you’ve paid a minimum, consider pricing part or all of these bushels. 2009 crop: The December contract’s close below $3.77 suggested the short-term trend may be turning down into a short-ter m cycle low due in early November. You should have used recent strength to price bushels you needed to move at harvest. We are still not ready to add to our basic recommendation, seeing higher prices ahead. But if you use commercial storage, consider making a sale. Potential gain from here may no more than cover the cost of storage. Fundamentals: Weather continues to dominate the short-term price expectations. Harvest is off to its slowest start since the middle 1970s and maybe even earlier. The more it’s delayed, the more field losses could rise, cutting into potential output.

Soybean Strategy

Relative values important A lack of faith not only in the U.S. financial system but the world financial system, is one of the ingredients that continues to drive money

Basis charts

into gold and its prices higher. Eventually, that starts to rub off on other investment vehicles, as well, especially if they become “low priced” relative to gold. We’d argue such is the case for grain prices. Just a few weeks ago, corn (chart above) and wheat prices got cheaper than they ever had relative to gold. Soybean prices didn’t go to a new extreme like the other two, but prices did get near the historical extreme. In this new era in which commodities are now seen as an alternative investment, those relationships take on increasing importance. Money flows into areas that present better potential return on investment. Right now, the relative values suggest grain looks more attractive than gold or energ y. I n v e s t m e n t m o n e y i n futures for all three has steadily risen since last December. That may be saying something about “big money’s” attitude about long-term price potential.

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2008 crop: If you are still holding old-crop soybeans, especially in commercial storage, consider pricing them if November futures get to $9.90. 2009 crop: As expected, soybean prices have climbed high enough that they’ve started to str ug gle to maintain gains. Price soybeans that need to be moved at har vest. If November is above $9.90 and you store soybeans commercially, consider pricing some additional bushels. While we expect higher prices yet this winter, we are not sure additional gains will be a lot more than the cost to store them. Fundamentals: This is the slowest start to har vest since at least back into the middle 1970s. T he long er it’s delayed, the more likely harvest losses will increase, cutting into potential production. T he demand structure for the next few months is still very strong, indicating prices will need to move high enough to pull soybeans out of producers’ hands. Early forecasts for the South American crop are big, but

that’s not unexpected, either.

Wheat Strategy  2 0 0 9 c r o p : We a r e inclined to think wheat put in its 40-week cycle low the first week of October. However, the short-term trend may have turned down again because of a lack of fundamental support. The December contract reached our $5 price target to make catch-up sales. We are not yet advising additional sales; we anticipate better marketing opportunities later this winter.  Fundamentals: For the second year in a row, soft red

w h e a t a c r e s c o u l d d e c l i n e. Recent rains have kept producers from harvesting row crops, opening land for planting wheat. It may be more difficult to get a good stand if wheat is planted in saturated soils. Even then, the later it’s planted, the less potential growth it will have before it goes dormant. And that makes it more susceptible to winter kill. Other fundamentals remain unchang ed. Keep a close eye on India this winter as its wheat crop may suffer after the poor summer monsoon and poor fall rains.


FarmWeek Page 12 Monday, October 19, 2009

PERSPECTIVES

It’s bad when insect hordes wreak havoc

Know your farmer via farmers’ markets, what else? Peoria has two; both Springfield and Jacksonville have three, while Alton, Carthage, Beardstown, Galesburg, Macomb, and Oneida all have one. Chicago has more than 80. In fact, many towns and cities in the state have one. I am talking about farmers’ markets. While farmers’ markets have been around awhile, they have recently become a real focus for USDA. Under the title of “Know Your Farmer, Know Your Food,” USDA has begun a program that it hopes will start a “national conversation about developing local and regional food systems and finding ways to support small and mid-sized farms.” The “conversation” has four components –- supporting local farmers, strengthening rural communities, proWILLIAM moting healthy eating, and protecting BAILEY natural resources. Clearly, those are areas no one could reasonably refuse to support and encourage. The key aspect of the initiative seems to be an attempt to reconnect consumers with farmers. And it appears USDA believes the place to do that is not at the supermarket but at the local farmers’ market. By encouraging people to buy locally produced food, USDA seems to hope that local communities would prosper, people would become healthier, and the environment would become cleaner. I certainly hope so. A key factor in the Know Your Farmer program is the belief that consumers want to know the complete history of the food they consume. If consumers don’t know that history, they often will make it up. A major food chain, sensing consumers wanted to know who grew the fruits and vegetables it sold, put

pictures of farmers up in their stores — “Today’s carrots were grown by Farmer Brown.” It turns out consumers were really not as interested in knowing the carrots were grown by Farmer Brown as anticipated; sales were not altered by linking the farmer and the product. The chain stopped that effort. However, the drive to narrow the gap between farming and consuming and to understand the complete history of food continues with this USDA effort. Early in his role as secretary of agriculture, Tom Vilsack proclaimed that USDA would represent eaters as well as producers. The “Know Your Farmer, Know Your Food” effort is clearly a step in that direction. Where the American farmers who are producing for export markets or bio-energy rather than local food consumption fit into this effort is unclear. Perhaps there will be a new effort called Know Your Farmer, Know Your Exporter. Nevertheless, USDA’s efforts appear to be positive and constructive. I like farmers. I like food. I like and actively support farmers’ markets. Unfortunately, according to the Illinois Department of Agriculture website on farmers’ markets, the vast majority of the Illinois farmers’ markets close during October, to re-open again during June. I trust USDA was aware of this when it kicked off its program on Sept. 24. Perhaps USDA will soon have some advice about how to support local farmers between October and June. William Bailey is director of the school of agriculture at Western Illinois University, Macomb. His e-mail address is WC-Bailey@wiu.edu.

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Every fall the soybean aphid takes a little trip. Like many aphids, the soybean aphid has two host plants — one where it spends the summer and another where it spends the winter. In the case of the soybean aphid, the summer host plant is the soybean, where they cause much concern for soybean producers. As winter approaches, soybean aphids develop winged forms that take flight in search of buckthorn plants. The winged aphids lay eggs on the buckthorn plants. These eggs then spend the winter on the buckthorn and when spring arrives, the eggs hatch, and a new crop of soybean aphids begins to develop. Normally, the soybean aphids are largely unnoticed as they make their annual fall pilgrimage. After all, soybean aphids are small insects. So, in general, people don’t pay much attention to small flying insects that are often lumped under the generic term of gnat. While a gnat or two might not TOM become an issue for most people, high TURPIN numbers of these small flying insects will attract attention. And so it was this year with the soybean aphids. The aphids were flying around in such numbers that people were getting them in their eyes and ears. Bicyclists and joggers were sucking the insects into their noses and mouths. Almost any daytime outdoor activity during the weeklong flight period resulted in aphid and human encounters of the closest kind. But aphids aren’t the only insects that occasionally show up in large numbers and interfere with human activities. For instance, on Oct. 6, 2007, a major league baseball game between the New York Yankees and the Cleveland Indians suddenly was inundated by hordes of flying midges. These small biting insects were attracted by the lights of the stadium and made life miserable for the players. A Yankee pitcher was especially affected and threw two wild pitches while besieged by the midges and proclaimed that the insects “bugged him.” Because the Yankees lost the game, one newspaper headline proclaimed “Midges 1, Yankees 0.” Another insect that sometimes creates havoc with massive numbers is the mayfly. Mayflies are insects that are aquatic in the immature stages. These insects sometimes emerge from the water in numbers great enough to be picked up on Doppler radar. The adult of the mayfly lives for only about a day, so the carcasses of the dead insects accumulate on bridges in similar fashion to the accumulation of snow during a winter storm. In fact, many are the reports of the need to use snowplows to remove the mayflies from bridges to prevent auto accidents caused by poor traction. In July 2006, a Pittsburgh bridge was closed for an hour while the dead mayflies were removed. In the same year, bridges over the Mississippi River near Lacrosse, Wis., were inundated with mayflies that were piled into “drifts.” While hordes of flying insects seem to attract the most attention, at least one caterpillar is known to turn a few heads when it migrates. These are the armyworms, so named because they march like an army from one field to another. The armyworms are moth caterpillars, and they move “in mass” from a field once they have devoured the foliage. Whether on the fly or on the march, hordes of tiny insects do attract attention. And generally that attention does little to create positive feelings among humans for the insect world. Tom Turpin is an entomology professor at Purdue University, West Lafayette, Ind. His e-mail address is turpin@purdue.edu.

FarmWeek October 19 2009  

FarmWeek Oct. 19 2009 edition

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