Page 1

A CentrAl IllInoIS lawmaker proposes to hold the U.S. Environmental Protection Agency more accountable for overregulation on such things as dust. ...........4

IllInoIS Would establish statewide standards for commercial wind energ y projects if newly approved Illinois Farm Bureau policy comes to pass. ...........................3

rISInG InPut CoStS and overregulation by the governm e n t we r e c i t e d b y s u r ve y e d farmers as the greatest threats to profitability. ..................................7

Monday, December 12, 2011

Two sections Volume 39, No. 49

Senators: Bipartisan fiscal cooperation crucial

Periodicals: Time Valued

BY MARTIN ROSS FarmWeek Jointly admonishing both parties, U.S. Sens. Dick Durbin and Mark Kirk warned Illinois Farm Bureau members some hard fiscal truths lie ahead for political hardliners as well as consumers and farmers. However, Kirk, a Highland Park Republican, called agriculture “one of the key parts of the economy that will pull us out of the doldrums,” and stressed Congress’ need to help “advance higher incomes in the agricultural sector.” That will require reining in federal regulators, promoting trade in growing Asian markets, empowering private industry to leverage infrastructure investment, and enabling farm families to adequately train the next generation of U.S. producers, Kirk argued at the IFB annual meeting last week in Chicago. Durbin, a Springfield Democrat, agreed agriculture “is really the bright spot of the economy,” sustaining one in 12 U.S. jobs, charting record export growth, and continually providing “affordable food.” “In today’s economy, where every dollar counts, that’s critical,” the senior senator said. Durbin told IFB delegates “Farm Bureau gets it right when it comes to knowing how to approach members of Congress,”

citing its role in resolving the “forhire” trucking controversy and securing three free trade agreements expected to fuel $2.3 billion in added U.S. ag exports. That said, Durbin and Kirk

Sen. Mark Kirk

see tough fiscal decisions ahead in the wake of the congressional “super committee’s” failure to reach a $1.2-trillion deficit reduction compromise. Budget realities flavored

new IFB farm bill polices that acknowledge, as Durbin told reporters, that “direct payments are a thing of the past.” Kirk said he and his senior colleague agree Congress should push a $4-trillion longterm deficit measure that considers both key reforms in federal entitlements (“tough medicine for Democrats”) and increased tax revenue generation (“tough medicine for Republicans”). The pair view the “SimpsonBowles plan” — recommendations from a 2010 bipartisan deficit reduction commission on which Durbin served — as the template for fiscal reforms. Key to that plan is elimination of what Kirk called “lobbyist loopholes” — major special-interest tax breaks that represent some $2 trillion in lost revenues. “We use $1 trillion to lower the deficit, to show how different we are from Europe,” Kirk told farmers with a nod to European debt.

“We use the second trillion to drop the top (individual income tax) rate from 39 to 29 percent.” “Simpson-Bowles is one of the best plans going forward. It allows us to reform taxes. It

allows us to cut the deficit. It makes things more fair. And, already, 45 Republicans and Democrats in the Senate agree.” Beyond projected farm bill spending cuts, Durbin noted

ongoing budgetary impacts for rural Illinois. The U.S. Postal Service has proposed closing half of its nearly 500 mail processing centers as well as a number of local post offices. Durbin believes “Illinois gets hit a little too hard here.” But amid a 30 percent reduction in mail volume, he argued “we are naïve to believe there will not be significant changes within the postal service.” Durbin hopes he and colleagues this month can devise a specific 10-year deficit blueprint based on SimpsonBowles principles, though he recognized “an election year doesn’t make it any easier.” IFB President Philip Nelson said he is “very concerned” by super committee failure, noting the uncertainty created by the U.S.’ recent credit rating downgrade alone. “Until we get our fiscal house in order, it’s very shaky,” Nelson told reporters at the annual meeting.

about Illinois tax policies. The recently defeated tax proposals had targeted the tax burden on the CME Group Inc. and Sears Holding Corp. Both proposals also phased-in increases in the individual state estate tax exemption and extended state sales tax incentives on bio-based fuels. “We anticipate that many of the major issues in this latest package will be similar to what was discussed before, but will be modified to address the many concerns raised by indi-

vidual legislators,” said Kevin Semlow, Illinois Farm Bureau director of state legislation. “We are hopeful and have been working for the increases in estate tax deduction levels and extensions of the life of ethanol and biodiesel sales tax credits,” Semlow added. Last week during the IFB annual meeting, county Farm Bureau delegates approved a sense of the delegate body with a special emphasis on improving the state’s business climate. Ogle County Farm Bureau delegate Brian Duncan viewed the delegates’ action as sending “a message loud and clear from this group” to the General Assembly and the state’s constitutional officers. The delegates approved language supporting fair, competitive, stable, and predictable state tax policies that maintain

a competitive overall tax burden while providing essential services that are competitive with other states. The delegates urged the state to commit to action that would improve infrastructure, reduce businesses’ regulatory burdens, and encourage business development to expand the tax base among other factors. “If Illinois continues to treat businesses like unwanted houseguests, they will leave,” Duncan told FarmWeek. “The only way we’re going to get out of this financial mess is an intentional effort to grow the tax base whether you’re talking livestock businesses, wind farms, agriculture, or non-agriculture businesses.” “IFB will work with other efforts in addressing issues supported by the delegates in the resolution,” Semlow said.

Sen. Dick Durbin

Legislators returning for special session; FB delegates OK business climate ‘message’ BY KAY SHIPMAN FarmWeek

State representatives today are expected to again consider a proposal to reduce the tax burden on two of Illinois’ major corporations. At presstime Friday, there was speculation the state Senate would return Tuesday. A couple of weeks ago, the House and Senate could not agree on different tax proposals even after months of negotiations to address warnings from the business community

Call to action! NOW is the time to make YOUR calls for the state estate tax and renewable fuel tax extension. Contact your state senator and representative. Urge them to vote for House Amendment 6 to Senate Bill 397. Please call before Tuesday. Call toll-free 877-422-8424 and ask to be transferred to your state senator and representative. Please report your contacts to Farm Bureau.

FarmWeek on the web: FarmWeekNow.com

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


FarmWeek Page 2 Monday, December 12, 2011

ANNUAL MEETING

Nelson, Guebert re-elected; two new members join board DR. PHIL? — Retiring Country Financial CEO John Blackburn proved he is still pretty quick on his feet when he spoke at last week’s Illinois Farm Bureau annual meeting. One award winner who had preceded Blackburn to the lectern misspoke and referred to IFB President Philip Nelson as “Dr. Nelson,” while another said he was so impressed with Nelson’s annual president’s address that the IFB head should run for governor. When Blackburn took the microphone, he quipped he didn’t know whether to address Nelson as Governor Nelson or Dr. Phil. Later in the week, it was announced that Blackburn would be returning to the academic world he left for the insurance business in 1982 (see details on page 8). *** IAA FOUNDATION FUNDRAISERS — Several activities during the IFB annual meeting helped the IAA Foundation raise money to support the Illinois Agriculture in the Classroom (IAITC) program. The effort is on track to raise more than $40,000 over three days of activities. The first events, a live auction and an ice cream social, raised $17,360 and more than $1,200, respectively. An estimated $13,000 was raised through the threeday silent auction of about 150 donated items. A trivia contest raised an estimated $8,500 and drew 29 teams. The Woodford County Farm Bureau team placed first in the county Farm Bureau category. The winning staff team included representatives of the member services and public relations, governmental affairs and commodities, and news and communications divisions. The Sangamon County Farm Bureau team won the team spirit award. *** PENNY WARS — Young Leaders during the IFB annual meeting in Chicago hosted penny wars that raised a record $7,579.84. The record amount was given to the winners of this year’s penny wars, the Young Leaders of District 15, who will disperse the funds to local food pantries. Penny wars are held each year at annual meeting. A collection jar for each IFB district is placed on a table at the exhibit hall so meeting attendees may make donations.

(ISSN0197-6680) Vol. 39 No. 49 December 12, 2011 Dedicated to improving the profitability of farming, and a higher quality of life for Illinois farmers. FarmWeek is produced by the Illinois Farm Bureau. FarmWeek is published each week, except the Mondays following Thanksgiving and Christmas, by the Illinois Agricultural Association, 1701 Towanda Avenue, P.O. Box 2901, Bloomington, IL 61701. Illinois Agricultural Association assumes no responsibility for statements by advertisers or for products or services advertised in FarmWeek. FarmWeek is published by the Illinois Agricultural Association for farm operator members. $3 from the individual membership fee of each of those members go toward the production of FarmWeek.

Address subscription and advertising questions to FarmWeek, P.O. Box 2901, Bloomington, IL 61702-2901. Periodicals postage paid at Bloomington, Illinois, and at an additional mailing office. POSTMASTER: Send change of address notices on Form 3579 to FarmWeek, P.O. Box 2901, Bloomington, IL 61702-2901. Farm Bureau members should send change of addresses to their local county Farm Bureau. © 2011 Illinois Agricultural Association

Two Illinois farmers are entering their final terms on the Illinois Farm Bureau Board of Directors while two others are beginning their careers as members of the board as a result of elections at last week’s IFB annual meeting in Chicago. Elected by acclimation to their fifth and final two-year terms were IFB President Philip Nelson, 54, of Seneca and Vice President Rich Guebert Jr., 60, of Ellis Grove. Both were first elected in 2003. The two new members of the board are Robert Gehrke, 53, Elgin, and Dennis W. Green 59, Lawrenceville. They replace Mike Kenyon, South Elgin, and Richard Ochs, West Liberty, respectively. Kenyon and Ochs retired after serving their allotted 10 years on the board. Gehrke will represent District 1, which encompasses Boone, DeKalb, Kane, Lake,

and McHenry counties. Gehrke and his wife, Beth, operate a grain, corn, soybean, wheat, and hay operation. He served as the Kane County Farm Bureau president from 2004 to 2010 and as secretary-treasurer from 1992 to 2004. He also served on the IFB Resolutions Committee and participated in the organization’s Market Study Tour to China in 2009. He is the Robert Gehrke financial secretary and chairman of stewardship for St. John’s Lutheran Church in Sycamore and has served as director of CONSERV FS since 2002. He and his wife have two children, Wayne and Carolyn. Green will represent District 13, which encompasses

Clark, Coles, Crawford, Cumberland, Jasper, Lawrence, and Richland counties. Green and his wife, Debbie, own a corn and soybean operation. Green presently serves on the Lawrence County Farm Bureau board and served as the board’s president in Dennis Green 2009. He served on the board previously from 1976 to 1992 and was president from 1981 to 1988. He served on the Lawrence County Unit 20 School Board from 1989 to 2002, and held the office of president for 10 years. He is a member of the Pleasant Ridge Christian Church. He and his wife have three grown children, Jonathan, Sara, and Jason, and five grandchildren.

New member elected to board of IAAA Dennis Newhouse of Hoyleton in Washington County last week was elected as a director of the Illinois Agricultural Auditing Association (IAAA) representing service companies. The election was conducted during the Illinois Farm Bureau annual meeting in Chicago. He replaces Ron Fehr of Baldwin in Randolph County, who retired after 12 years of service. Gary Luth of Allerton in Douglas County was re-elected

president, a position he has held since 2004. Newly elected vice president is James Lynch of McLean in McLean County. He was elected to the IAAA board in 2009. Robert Phelps of Rockton (Winnebago County) was reelected as secretary and the GROWMARK Inc. representative on the board, and James Sheaffer of Dixon in Lee County was re-elected as the at-large director. Terry Pope of Burnside in

Hancock County was re-elected as the IFB representative on the board. IAAA provides auditing services to agribusinesses throughout the Midwest. Lenders and regulators use its services, and its personnel are recognized as experts in audit and taxation of agricultural cooperatives and non-for-profit organizations. It is the only certified public accountant firm that specializes in agribusiness.

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STAFF Editor Dave McClelland (dmcclelland@ilfb.org) Legislative Affairs Editor Kay Shipman (kayship@ilfb.org) Agricultural Affairs Editor Martin Ross (mross@ilfb.org) Senior Commodities Editor Daniel Grant (dgrant@ilfb.org) Editorial Assistant Linda Goltz (Lgoltz@ilfb.org) Business Production Manager Bob Standard (bstandard@ilfb.org) Advertising Sales Manager

Richard Verdery (rverdery@ilfb.org) Classified sales coordinator

Nan Fannin (nfannin@ilfb.org) Director of News and Communications

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Hurst and Associates, Inc. P.O. Box 6011, Vernon Hills, IL 60061 1-800-397-8908 (advertising inquiries only) Gary White - Northern Illinois Doug McDaniel - Southern Illinois Editorial phone number: 309-557-2239 Classified advertising: 309-557-3155 Display advertising: 1-800-676-2353

Illinois FFA State Treasurer Clayton Carley of Cissna Park signals a bid during the live auction at last week’s Illinois Farm Bureau annual meeting. The auction raised $17,360 for the IAA Foundation. (Photo by Cyndi Cook)


Page 3 Monday, December 12, 2011 FarmWeek

ANNUAL MEETING

Nelson: Ag should be celebrated for its many accomplishments BY DANIEL GRANT FarmWeek

Farmers should not fear the fact that many consumers who have no ag background more and more want to know where their food comes from and how it is grown or raised. In fact, farmers should embrace the opportunity to interact with consumers to convey what is a very positive, but often untold, story about the industry, according to Philip Nelson, president of the Illinois Farm Bureau. Philip Nelson “We have to tell our story now more than ever before,” Nelson said during his annual address at the IFB annual meeting in Chicago. “We’ve done such a good job being efficient producers, sometimes we failed to connect with consumers,” he said, speaking extemporaneously, as he does each year.

Nelson noted that at a time when the general economy has been sluggish, U.S. agriculture this year is on pace for record net farm income in excess of $100 billion, and ag exports are projected to total $115, with a trade surplus of $42 billion. Consumers are big winners in ag’s success as one farmer currently can feed about 155 people, said Nelson. Meanwhile, U.S. agriculture accounts for about one-quarter of the nation’s gross national product. “President (Abraham) Lincoln (who formed USDA 150 years ago) got it right when he said ‘Agriculture is the backbone of the economy,” Nelson said. But everything from government debt and over-regulation to activist groups threaten the livelihood of U.S. farmers, according to the 14th IFB president. The Obama administration already has imposed 75 new major regulations that will cost taxpayers during the next decade more than $380 billion, Nelson

noted. Employment in regulatory agencies has climbed 13 percent since Obama took office, he said. “When I talk about (the need for) job creation, that’s not exactly the type of job creation I’m talking about,” Nelson quipped. Nelson said he is concerned overreach by the U.S. Environmental Protection Agency, such as proposed dust regulations, could force some farmers out of business and drive up the cost of food. “We’re price-takers not price-makers,” he said. “We can’t pass (additional) costs along.” What farmers can do is focus on becoming more efficient, be engaged with lawmakers and other government officials, and meet with consumers and explain how food is produced in modern systems. “I think our best days in agriculture are still in front of us,” Nelson said. He said he believes farmers can meet the challenge of producing more food for a growing population if they

have access to such tools as biotechnology. Market access also is vital to ensure food products reach consumers who need them. Nelson praised lawmakers and the Obama administration for finally passing and enacting free trade agreements with Colombia, Panama, and South Korea. “We believe in free trade, fair trade, and more trade,” Nelson said. Consumers also have a lot to gain from efficiencies in agriculture. U.S. farmers the past 25 years reduced soil erosion by 43 percent and through precision agriculture have reduced the amount of fuel and fertilizer required to grow crops on a per-acre basis. Since World War II the average time to produce 100 pounds of meat had been reduced from 4 hours to 1.2 hours for beef and from 3 hours to 30 minutes for pork, Nelson noted. “This is the type of production and efficiency we need to feed 9 billion people on this planet by 2050,” he added.

FB delegates OK statewide commercial wind farm standards Illinois would establish statewide standards for commercial wind energy projects if newly approved Illinois Farm Bureau policy comes to pass. County Farm Bureau delegates passed policy to seek legislation establishing statewide standards for commercial wind energy conversion systems. Currently, wind projects of any size in Illinois are governed by county and/or local ordinances, and county governments are continuing to change their zoning ordinances. As of July, 45 counties regulate large-scale wind projects with zoning codes, and six counties have stand-alone zoning ordinances for large-scale wind farms, according to the Illinois Institute for Rural Affairs. Eleven counties have zoning ordinances that do not regulate large-scale wind farms while the remaining counties

don’t have zoning. Under new Illinois Farm Bureau policy, the statewide standards would provide adequate protection of public health and safety, protect private property rights, and allow for reasonable development of commercial wind energy conversion projects. The standards would include, but are not limited to, the issues of property setbacks and other siting issues, performance bonds, and making certain adequate funds are in place for decommissioning. During delegate debate, Kane County Farm Bureau delegate Joe Brian Duncan White said local control would be a better approach for wind development. But Ogle County Farm Bureau delegate

County Farm Bureau delegates believe the government may put the cart before the horse with certain livestock waste permit requirements. Last week those delegates emphasized that view with new Illinois Farm Bureau policy. At the IFB annual meeting in Chicago, delegates passed new policy opposing any regulation that requires a concentrated animal feeding operation (CAFO) to need a national pollutant discharge elimination system (NPDES) permit if the facility does not discharge. “This is an important issue,” Jo Daviess County Farm Bureau delegate Ron

Lawfer told his fellow delegates. In March, a federal court of appeals ruled the Environmental Protection Agency cannot require livestock farmers to apply for Clean Water Act permits unless their farms actually discharge manure into U.S. waters. According to the ruling, non-discharging CAFOs do not need permits. Lawfer acknowledged the court ruling was issued in March, “But we feel it still needs to be in our policy book to let regulators know how we feel.” Lawfer also raised concerns about a livestock operator being required to obtain an NPDES permit during con-

BY KAY SHIPMAN FarmWeek

Brian Duncan said statewide standards would provide more certainty and uniformity for developers, especially with multi-county projects. The intent of the newly approved IFB policy would “provide for uniform siting of facilities statewide rather than having different standards between counties,” said Rae Payne, IFB senior director of business and regulatory affairs. In addition to uniform setbacks for siting of turbines, the policy would continue efforts to establish a fund or some type of guarantee that sufficient money exists to remove turbines if they are abandoned, Payne added. “Ultimately, it should be the wind operator’s responsibility to remove all turbines and related facilities from private land if they are unused for a period of time,” Payne said. “If the company no longer exists, then there should be resources available to remove

those facilities so that the responsibility is not left to the landowner.” David Loomis, director of Illinois State University Center for Renewable Energy, said the idea of a statewide decommissioning fund has merit. “That’s one (facet) where it is better to have lots of counties banded together ... and the force of the state behind it,” Loomis said. County Farm Bureau delegates also debated, but ultimately defeated, a proposal to create a county turbinedecommissioning fund based on property taxes paid by wind farm operators. Champaign County delegate Jerry Watson pointed out the proposed fund would be managed by local officials. However, Ogle County’s Duncan countered money for turbine decommissioning should be included in statewide standards. In other natural resource

policy debate, delegates approved policy to support legislation governing easement ownership rights. The new policy supports legislation for those rights to revert back to surface landowners if utility, pipeline, and underground gas storage easements or leases are unused, abandoned, or dormant for 20 years. One delegate asked who would be liable if the rights reverted back to the surface landowners. Laura Harmon with the IFB general counsel’s office answered that the rights granted under the easement or lease would revert back to the surface owner, but that a pipeline owner would be responsible for complying with federal and/or state laws dealing with abandoned pipeline and liability issues arising from the ownership of the pipeline.

FB delegates make CAFO statement in new policy struction of his facility. “We feel this (construction and operation) should be separated,” he added. Delegates also approved policy supporting environmental regulations clarifying that any discharge occurring prior to the operation of a livestock farm does not require the farm owner/operator to obtain an NPDES permit for the CAFO’s operation. Nancy Erickson, IFB director of natural and environmental resources, added, “We disagree with an owner/operator of a livestock facility having to get a CAFO NPDES permit before there are livestock there.” On another permit issue,

delegates approved policy opposing the government requiring an NPDES permit for pesticide applications when the applicator complies with the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). Natural resource and state and local government policy action included: • Support for conservation programs with a focus on protecting environmentally sensitive areas with filter strips, buffers, and other beneficial practices while reducing overall program costs; • Support of legislation to broaden the legal basis for farmland preservation

approaches and efforts to implement and use a variety of tools, such purchase of agricultural conservation easements and transfer of development rights; • Support of efforts to reduce the impact on agriculture of municipal annexation by reducing the parcel size that may be forcibly annexed to 10 acres and/or establishing a fixed minimum time period when ag practices may continue. • Support of efforts to revise rules and regulations governing election of commodity checkoff boards. Commodity checkoff boards are governed by Illinois law. — Kay Shipman


FarmWeek Page 4 Monday, December 12, 2011

annual meeting New ‘realities’

Delegates prioritize insurance, safety net

BY MARTIN ROSS FarmWeek

Illinois Farm Bureau delegates last week adapted ag policy proposals to new federal budget realities, even as IFB President Philip Nelson pondered the extent to which those realities will be “salable to the South.” Delegates deemed crop insurance “the top priority” for the 2012 farm bill. They urged increased federal premium support, USDA Risk Management Agency authorization for new programs such as farmer savings accounts, and insurance improvements that better reflect current trend line yields and “provide loss-ratio fairness across crops.” Further, producers gathered in Chicago sought “an improved and simplified” revenue-based safety net program that would provide more timely payments based on regional or county revenue benchmarks and loss triggers and protection from multi-year price volatility. Producer direct payments were absent from the proposal. IFB will take its recommendations to the American Farm Bureau Federation (AFBF) annual meeting next month. Sen. Dick Durbin, a Springfield Democrat, stressed the need for a 2012 farm bill that reflects “the realities of what you’re facing in the farming community.” “Agriculture’s always going to be risky, but good policy can avoid needless risk,” Durbin argued when he addressed IFB delegates. He applauded bipartisan House and Senate ag committees for crafting a “good agreement” that sets the stage for a move from direct pay-

ments to heightened revenue protection and “affordable, reliable” crop insurance. That agreement was devised to provide ag program savings under the now-defunct congressional super committee’s deficit reduction plan. Durbin is co-sponsor of a proposed Aggregate Risk and Revenue Management (ARRM) plan that would replace direct, countercyclical, Average Crop Revenue Election (ACRE), and Supplemental Revenue (SURE) payments. The new program reportedly would save $20 billion over 10 years. “With the new farm bill and the deficit reduction involved in it, direct payments are a thing of the past,” Durbin told reporters in Chicago. “We’re going to have to come up with a better, more equitable way to deal with this. “Sending farmers who are making more money than they ever have in history federal subsidy checks is indefensible. We have to find some sort of revenue protection so that when prices go down or there’s bad weather, a farmer can survive. That’s a reasonable role for government.” IFB’s Nelson hopes lawmakers can move a farm bill by next August, before fall political campaigns kick into full gear. Otherwise, “we’re debating this thing a year from now,” racing to beat 2008 farm bill expiration, he warned. Nelson was uncertain whether southern growers would be as willing as IFB to forego direct payments or target prices in favor of a substantially stronger safety net. The potential structure of that safe-

The 350 Illinois Farm Bureau voting delegates help shape 2012 policies for the organization during last week’s IFB annual meeting in Chicago. Delegate farm bill debate was unusually abbreviated this year, given recent congressional developments that have expedited ag policy development and advance work by IFB’s Farm Policy Task Force. (Photo by Ken Kashian)

ty net also may prove a major point of debate at the AFBF meeting. Durbin helped shape 2008 ACRE provisions, but he admitted “we weren’t as successful as we wanted to be,” and farmers have criticized ACRE’s state-level yield trigger. ARRM would trigger ACRE-style payments based on yield losses at the crop reporting district level. Meanwhile, AFBF has floated a Systemic Risk Reduction Program (SRRP) aimed at protecting against more catastrophic production-price risks, vs. the socalled “shallow losses” covered under ARRM. SRRP would provide “area-

based coverage” using available county level yield data as a payment trigger. Nelson characterized it as a sort of “one size-fitsall crop insurance program” being promoted as IFB fights “to keep (existing) crop insurance whole.” According to IFB risk management specialist Doug Yoder, ARRM would offer far more frequent but significantly smaller annual payments than SRRP. At the same time, ARRM offers “an added layer of protection” beyond crop insurance coverage, while SRRP could significantly “alter” an insurance program that’s seen key improvements in recent years, Yoder said.

“(SRRP) hasn’t been scored by the (Congressional Budget Office) — we don’t know what it will cost,” Nelson noted. “What we’re talking about, potentially, is something where everybody — cotton, rice, corn, soybeans — would have the ability to have ‘crop insurance,’ maybe at a 70 percent (coverage) level. “Then, basically, we would do away with direct payments, we would do away with the ACRE program, we would do away with countercyclical payments. That’s why we need to see how this thing scores: You’re talking about a lot of other components that would be eliminated.”

Dust regs prevention bill seeks new EPA accountability

The U.S. House has voted to block potential “farm dust” rules while including a Central Illinois lawmaker’s proposal to hold the U.S. Environmental Protection Agency (EPA) more accountable for the costs of overregulation. Downstate Illinois lawmakers hailed approval of the Farm Dust Regulation Prevention Act, which would amend the federal Clean Air Act to prohibit EPA from including farm dust under air quality “particulate” standards that apply to high-pollution areas. The Senate now must consider the measure. EPA Administrator Lisa Jackson recently stated she would seek no new “coarse” particulate (dust) rules, but past agency guidance has

raised concerns about possible regulation of crop tillage and harvest, livestock activity, and transportation on unpaved roads. Farmers who violate

sider job and other economic impacts before issuing new ag-related regulations. Under his measure, EPA would notify each affected

‘The United States should be the easiest place on the planet to star t and expand the family business.’ — U.S. Sen. Mark Kirk Highland Park Republican

“dust rules” reportedly could face fines of up to $37,500 a day. U.S. Rep. Aaron Schock, a Peoria Republican, targeted broader regulatory concerns via an amendment that would require EPA to con-

state’s congressional and state lawmakers and governor and hold public hearings if a proposed regulation is projected to cause statewide loss of more than 100 agrelated jobs or $1 million in ag economic activity.

New requirements would force EPA to more carefully mull rules “a real effect on farmers who are trying to run their operations across America,” Schock told House colleagues. He cited a new Illinois Farm Bureau producer survey which identified regulation as the greatest potential threat to Illinois farm profitability in the decade ahead. Meanwhile, U.S. Sen. Mark Kirk, a Highland Park Republican, proposes a moratorium on federal regulations that would cost more than $100 million nationwide. “Our legislation says to the executive branch, ‘If the regulation you want costs more than 100 million bucks, take a break, don’t advance it, let the

economy recover,’” Kirk told Illinois Farm Bureau delegates in Chicago. Near-term prospects for reining in federal agencies may be limited, he told FarmWeek, noting Senate Majority Leader Harry Reid (D-Nev.) is “pretty pro-regulation.” But Kirk said he favors a streamlined regulatory permit process, under a single authority, to ensure timely approval for business expansions, infrastructure improvements, and other economic activities. “The United States should be the easiest place on the planet to start and expand the family business,” he maintained. “We are beginning to fall in the rankings.” — Martin Ross


Page 5 Monday, December 12, 2011 FarmWeek

aNNual mEETING

Asian potential, European chaos on U.S. watch list

ONE SCOOP OR TWO?

BY MARTIN ROSS FarmWeek

Producers should look with anticipation to the Asian market while continuing to maintain an eye on the troubled European front. So advised U.S. Sens. Dick Durbin and Mark Kirk, featured guests at last week’s Illinois Farm Bureau annual meeting in Chicago. The respective Springfield Democrat and the Highland Park Republican hailed recent passage of new free trade agreements (FTAs) with South Korea, Panama, and Colombia, the latter a once-drug-plagued nation which Kirk said should now see significant export strides among its “legal businesses” even as it reduces or eliminates import duties on U.S. farm goods. But South Korea long-term should prove the most beneficial new trade partner of the trio, given the U.S.’ need to be “connected more and more closely to the Asian market,” Kirk told producers. Within a decade or two, China likely will become the world’s leading economy, largely on the strength of a rapidly growing middle class expected to devour “meats of all quality” and processed foods, Illinois’ junior senator said. But Kirk sees Chinese currency reforms as necessary to “unlock” that middle class, a force now numbering close to 200 million consumers by some accounts. Given the middle class’ anticipated impact on the rest of the Chinese economy, Kirk believes China’s government will initiate its own domestic currency reforms without need for congressional intervention that risks igniting a “trade war” with the influential Asian giant. “You know of the bad news in Europe and with the euro,” Kirk noted. “Having increasing connection to Asia not only links us to the market that has the fastest growing potential, but also the one that doesn’t have any of the currency or banking problems we see in Europe.” Europe’s debt crisis nonetheless requires U.S. attention, though not in the form of a financial bailout, Kirk and Durbin stressed. That crisis is “moving to a different level” with threats to Italy, the world’s seventh largest economy, warned Durbin, who argued “our economies are linked” by U.S. exports. The senators have met with International Monetary Fund Managing Director Christine Lagarde to discuss ways to head off the kind of collapse in Europe that contributed to U.S. Midwest bank failures in the early 1930s. “We cannot fund the recovery in Europe with our deficit,” Durbin emphasized. “But through the International Monetary Fund and other agencies we participate in, we can help direct the way toward a solution.”

Champaign County Farm Bureau member Loretta Stoerger, left, accepts a dish of ice cream from Ed Mullins, chief executive officer of Prairie Farms Dairy, during the ice cream social at last week’s Illinois Farm Bureau annual meeting in Chicago. Prairie Farms donated ice cream for the event that raised more than $1,200 for the IAA Foundation and ag literacy. (Photo by Cyndi Cook)

Durbin pledges livestock support, exercises caution on equine issue U.S. Sen. Dick Durbin took the pledge last week, vowing faith in Illinois producers’ “humane, thoughtful approach to raising livestock” and opposition to legislative “extremes” in animal welfare standards. During last week’s Illinois Farm Bureau annual meeting in Chicago, Ogle County hog and cattle producer Brian Duncan solicited the Springfield Democrat’s pledge to support the livestock industry amid increased scrutiny and lobbying by “groups with an agenda who’d like to see an end to livestock production.” The Humane Society of the United States (HSUS) recently entered into an agreement

SHOPPING THE OPTIONS

Henry County Farm Bureau members Steve and Theresa Owens, left and second from left, look over some of the 150 items that were donated for the silent auction during the Illinois Farm Bureau annual meeting last week. The IAA Foundation uses money raised by the silent auction to promote ag literacy. (Photo by Ken Kashian)

with United Egg Producers proposing more stringent nationwide layer hen housing standards. Legislation seeking to mandate those standards reported-

arisen with nationwide bans on equine slaughter, including reported abandonment and neglect of old or unhealthy horses and limited options for carcass disposal.

‘ You don’t make money with the mistreatment or maltreatment of livestock or any animals you’re raising.’ — U.S. Sen. Dick Durbin Springfield Democrat

ly may surface this month, and Duncan sees the threat of broader animal welfare requirements being proposed by those with “neither expertise nor experience in raising livestock.” Durbin, who worked as a youth at East St. Louis’ National Stockyards, assured Duncan “I’m on your side.” He acknowledged producer awareness of the link between sound animal care and livestock economics. “You don’t make money with the mistreatment or maltreatment of livestock or any animals you’re raising,” the senator said. “Aside from profitability, it’s a matter of conscience. People want to believe the livestock industry is doing it the right way. I believe that, because I know you.” At the same time, he agreed “very serious” concerns have

“Where we are now is not a sustainable direction,” Durbin admitted, agreeing producer burial of horses is “unrealistic.” However, he later told reporters at a news gathering during the meeting, “I’ve voted against horse slaughter, and I continue to oppose it.” “This issue is so hard, between the school kids who are sending me letters about slaughtering and those who find the notion of eating horsemeat reprehensible,” Durbin noted. To date, HSUS has worked largely on a state-by-state basis to impose new livestock limits. Since Californians passed a HSUS-driven measure to regulate egg production in 2008, California lawmakers have passed 30 laws addressing treatment of animals ranging from sharks to dairy cattle. — Martin Ross


FarmWeek Page 6 Monday, December 12, 2011

ANNUAL MEETING

Young Leaders: Livestock industry faces image problem BY DANIEL GRANT FarmWeek

The majority of livestock producers in the U.S. provide the best care possible for their animals and produce some of the safest, most affordable, and abundant products in the world. But a handful of bad actors in the industry, who often are in the news when they mistreat livestock, and effective anti-animal agriculture campaigns have created a public image problem for the industry. Farmers, therefore, should be proactive when it comes to promoting the industry, according to Illinois Farm Bureau Young Leaders. The question of how farmers can convince the public that the animal agriculture industry balances production efficiencies with the public’s expectations of animal care was discussed by Young Leaders Jesse Faber (Livingston County), Ann Larson (DeKalb County), Caleb May (Edwards County), and Katie Pratt (Lee County), during the finals of the Young Leaders Discussion Meet last week at the IFB annual meeting in Chicago. “The public’s perception of animal agriculture has plagued the industry in recent years,” May said. “Our job is to educate consumers.” And one of the most effective ways to reach consumers, according to the Young Leaders, is through one-on-one conversations. “Consumers don’t care if we’re efficient or if we’re making money,” said Pratt, the Discussion Meet winner. “But if we talk about the care of animals, we’ll get a lot further.” And the more farmers talk with consumers the better chance they have of building a relationship. “Developing a relationship with consumers and letting them know we’re a trustworthy source is important,” Pratt noted. “Once they know (farmers are trustworthy) they’re more likely to give us a call when they have a question.” Larson knows the value of meeting consumers face-to-face. She recently took part in an educational campaign in downtown Chicago and answered consumer questions when she sat under a sign that said “Ask a Farmer.” However, she noted there are more than 3 million people just in Chicago (and more than 9.8 million people in the Chicago metro area) and it, therefore, will be impossible to reach every consumer face-to-face or provide them all with farm tours. “We need to battle back (against anti-livestock campaigns) with emotion,” Larson said. “The way to do that is through mass communication known as social media.” The Young Leaders suggested farmers consider hosting farm tours, engage in one-on-one conversations, or become active in social media to educate consumers about modern farming practices. “We have to connect them to the products in the grocery store or we’re going to be the ones left holding it,” said Faber, the Discussion Meet runner-up.

Monica Stevens, front right, of Knox County was selected chairman of the Illinois Farm Bureau Young Leader Committee at last week’s annual meeting in Chicago. She will be assisted in 2012 by, front left, Brent Pollard (Winnebago County) secretary, back row, left to right, Todd VerHeecke (Henry County), chairman of the Achievement Subcommittee; Mike Carey (Grundy County), chairman of the Governmental Affairs and Commodities Subcommittee; Kurt Range (St. Clair County), chairman of the Education and Recruitment Subcommmittee; and Alan Bailey (Sangamon County), vice chairman. (Photo by Ken Kashian)

DRIVING AWAY WITH TOP BID

Delegates approve change in IFB bylaw language Delegates to the 97th annual meeting of the Illinois Farm Bureau approved two changes to the organization’s bylaws and defeated a third. On a weighted paper vote after voice and standing votes failed to provide a definitive outcome, a policy resolution dealing with nonresident membership passed 54,311 to 23,823. The resolution needed 53,153 votes to pass. Recommended by a special membership committee that met three times during the year, the resolution states that a county Farm Bureau will not solicit or accept the voting membership of a person who resides and also farms or owns farm ground in another county except with the consent of the Farm Bureau in that county. Delegates defeated a resolution dealing with dual membership, seeking clarification for a vote at the 2012 annual meeting. Delegates also voted to make bylaw language consistent with state law that went into effect June 1 giving those involved in civil unions the same rights as married couples.

Illinois Farm Bureau President Philip Nelson, right, looks on as David and Sharon White, Wayne County Farm Bureau members, celebrate their winning bid for a John Deere gator XUV625i donated by Deere Co. and Sloan Implement. Held during last week’s IFB annual meeting in Chicago, the live auction raised money for ag literacy and the IAA Foundation. (Photo by Ken Kashian)


Page 7 Monday, December 12, 2011 FarmWeek

AnnUAl MEETinG IFB survey:

GROUP HUG FOR A FARMER

Farmers concerned about regs, input costs

BY DANIEL GRANT FarmWeek

Many farmers enjoyed a profitable year in 2011 despite numerous challenges, including spring floods followed by a midsummer drought. But there are still plenty of concerns about future economic prospects as farmers turn the page and prepare for 2012 and beyond, based on a survey of farmers conducted last week at the Illinois Farm Bureau annual meeting in Chicago. The survey of 399 farmers found the top threat to profitability in the industry in the next decade is government regulations. About 40 percent of survey respondents listed those as the top threat. Other top concerns for the upcoming decade include input costs, big government/politics, lower commodity prices, land prices/cash rents, and commodity price swings. “Many of the concerns we saw in the survey aren’t surprising,” said IFB President Philip Nelson. “But it still gives us a good idea of where we need to focus our efforts in the coming years.” This year was “fantastic” on the farm of Bernie Walsh, a FarmWeek Cropwatcher from Winnebago County. High yields and historically high commodity prices allowed many farmers in his area to replace machinery or pay down debt. “The general feeling right now is good and upbeat, but there are two or three things that concern me,” Walsh said. “Higher inputs costs, higher cash rents, and government regulations are always on the horizon.” Farm input costs this year are projected to reach a record-high of nearly $320 billion nationwide, according to USDA. The possibility of higher input costs was listed by survey respondents as the top threat to profitability in 2012. “One of the disturbing things right now is how crop prices have eroded and input prices have done the opposite,” said Ron Frieders, an IFB member from DuPage County. Corn and soybean prices have dropped about 20 percent since September. “We’re getting used to paying higher inputs costs,” said Ron Moore, a Cropwatcher from Warren County. “When (commodity) prices go down, it squeezes margins. “The ag economy is very good right now,” he continued. “But my other concern is the general economy. There’s a lot of investment (in ag) right now, but when the general economy heats back up will there be a flight back to the U.S. stock market?” Meanwhile, 68 percent of survey respondents plan to plant the same number of corn acres in 2012, 21 percent plan to increase corn plantings, and 11 percent expect to plant fewer corn acres. Almost half the survey respondents are livestock producers and 65 percent indicated they do not plan to expand their herd size in the next five years. Retirement and farmers’ advancing ages were the most frequently cited reasons.

AUTHOR, AUTHOR

Hancock County Farm Bureau member Sharon Barr, left, chats with children’s author Michelle Houts as she signs a copy of “The Beef Princess of Practical County.” Houts, an Ohio educator and farm wife, signed copies of her realistic portrayal of modern livestock production last week during the Illinois Farm Bureau annual meeting in Chicago. She also taught a special workshop for Chicago teachers. (Photo by Ken Kashian)

Schuyler County Farm Bureau member Kent Prather, center, receives a group hug from kindergarteners at Chicago’s St. Mary Star of the Sea School. Kent and Sandy Prather; Jean Barron, the county’s ag literacy coordinator; and Tammy Caldwell of First Farm Credit Services, Macomb, taught a corn-related lesson to the county Farm Bureau’s “adopted” classroom during a visit to the classroom in conjunction with the Illinois Farm Bureau annual meeting. The students are seen wearing their Schuyler County Farm Bureau T-shirts. (Photo by Jean Barron, county ag literacy coordinator)

Recordkeeping key to ag employers facing possible worker’s comp liability BY MARTIN ROSS FarmWeek

Keeping good employee work records — “the right records” — is critical for farmers in determining whether the Illinois Worker’s Compensation Act applies to them, according to Chris Hemenway, manager of worker’s compensation claims with Country Financial. The act establishes benefits for workers who suffer job-related injuries or illness. It includes an ag exemption. but operations are subject to a “400-day rule” that may require them to carry worker’s comp insurance. Farmers with any significant workforce should tighten employee documentation and recordkeeping, argues Hemenway, who has processed worker’s comp claims for 30 years. “The exemption really only applies to the smaller farm operations,” she said. “If an operation reaches 400 working days of labor in any quarter of the prior year, (it’s) lost (its) exemption They have to carry worker’s comp insurance. “You have to look at each employee, literally count up the number of days they’ve worked every quarter. If you have five employees, add up the days for all those employees per quarter. If any one quarter reaches 400, you’ve lost your exemption.” The calculations must include not only full-time employees but also migrant/seasonal workers and part-time employees. A part-timer who logs four hours a day over six days figures into the 400-day count as fully as a full-time laborer who works 10 hours daily over the same period. Because of the unusual and seasonably variable nature of farm work, pinpointing an employee threshold that triggers the 400-day rule can be difficult, admitted Hemenway, who outlined worker’s comp rules at Illinois Farm Bureau’s annual meeting. Generally, an average four to five employees working six to seven days a week will get you to 400 days, she said.

When in doubt, write it out, in the form of time sheets or other daily worker records. Employers should track the actual number of days, rather than cumulative weekly hours, logged by each worker. Failure to maintain accurate, comprehensive records can prove costly. The costs of an injury claim would be the responsibility of the farm employer, and a typical shoulder or knee or back injury can cost $50,000 to $150,000. Hemenway also noted the Illinois worker’s comp law allows “substantial fines and penalties” for being uninsured. The Illinois Worker’s Compensation Commission Insurance Division is now authorized to issue citations levying $500 to $2,500 in fines against non-compliant employers, who must pay fines and submit proof of worker’s comp insurance within 10 days. If the commission can prove a subsequent “knowing violation” of insurance requirements — potentially, a Class 4 Felony — the employer may be liable for up to $500 per day for every uninsured day, with a minimum fine of $10,000. Fines may be imposed not only on individual employers but also on farm corporate officers or partners or members of a limited liability company under which an operation functions. The commission can issue a “work stop” order which shuts down an operation; employers convicted of a knowing violation lose all protections under worker’s comp law. An injured employee can then file a civil lawsuit to recover medical costs, lost wages, permanent disability, and other damages. Employers in such suits generally are treated under strict liability criteria. The worker’s injury is considered prima facie evidence of employer negligence, and “you really don’t have any defense you can put forth, Hemenway advised.


FarmWeek Page 8 Monday, December 12, 2011

ANNUAL MEETINg

Friendly, frank discussions focus of ‘field mom’ event BY KAY SHIPMAN FarmWeek

A group of farmers last week described everything from their typical work day to the gestation period for sows. But some of the people who used such words as “farrow” and “finish” weren’t farmers. The second Chicago meeting between “field moms” and farmers proved not only that the urban women are still curious about food production, but they’re also building on the basic ag information they’ve learned and are asking more in-depth questions. In conjunction with last week’s Illinois Farm Bureau annual meeting in Chicago, Illinois Farm Families hosted a reception and chat for Chicago-area field moms and farmers. Laughter frequently punctuated the sometimes serious discussions. “I love talking to you guys

Field mom Farrah Brown, lower right, Glendale Heights, asks a question of farmers Chris Gould of Maple Park, left, and Pam Janssen of Minonk, second from left, during an Illinois Farm Families activity last week in Chicago. Looking on are Brown’s fellow field moms, Betsie Estes of Elk Grove Village and Jenn Weiss of Big Rock; Deb Moore, a Roseville farm hostess; and Brown’s friend Shealegh Laramie, seated beside Brown. (Photo by Cyndi Cook)

because it helps flesh things out,” said field mom Jenn Weiss of Big Rock. She later

asked about raw milk and food safety concerns. “We’re here to answer the

AUCTION PEDAL POWER

questions you moms have,” said Deb Moore, a Roseville farmer and the hostess of the

Illinois Farm Families field mom program. Weiss and her fellow field moms Betsie Estes, Elk Grove Village, and Farrah Brown, Glendale Heights, and Brown’s friend, Shealegh Laramie, participated in a farm show-andtell with samples of silage and feed supplied by Pam Janssen of Minonk. Chris Gould of Maple Park offered images of different animal care practices on his hog operation. Brown shared that her young son was impressed that his mother had been in a combine during an October farm tour, hosted by Illinois Farm Families. The 5-year-old bragged to his classmates about his mom’s combine experiences. “I feel like my eyes were opened on the first farm visit to a life I didn’t even know existed — the life of a farmer and intricate business you have,” Brown told the group.

AN ICE CREAM SMILE

Dylan Zwilling, right, pulls ahead on a John Deere pedal combine while Caleb Zwilling, left, attempts to catch him on a Case IH combine. The two are sons of Paula and Brad Zwilling of Fisher. The two pedal vehicles were sold in a live auction to raise money for the IAA Foundation during last week’s Illinois Farm Bureau annual meeting. (Photo by Cyndi Cook)

Colin Chesnut of Vermilion County enjoys a dish of Prairie Farms ice cream during the ice cream social at the Illinois Farm Bureau annual meeting in Chicago. The activity raised more than $1,200 for the IAA Foundation. (Photo by Cyndi Cook)

Blackburn to head Lincoln College John Blackburn, 63, who in July announced his retirement as CEO of Country Financial after nearly 30 years with the company, last week was announced as the 21st president of Lincoln College, a private college headquartered in Lincoln in Logan County. Blackburn has ties to the college, which also has a campus in Normal. He has served on the college’s board of trustees since 2002, including three years as board chairman. His daughter is an alumna of the college, and both Blackburn and his wife, Barb, began their careers as teachers. The Blackburns live in Lincoln and own The Blue Dog Inn, a restaurant in downtown Lincoln. Blackburn will assume his new position in August 2012.


Page 9 Monday, December 12, 2011 FarmWeek

Three receive IFB’s highest honor Dr. Robert Easter, Mahomet; Dr. Gary Minish, Plano, Texas; and former state Sen. Todd Sieben, Geneseo, were recipients of the 2011 Illinois Farm Bureau Distinguished Service Award at last week’s annual meeting in Chicago. The award is the highest honor given by the IFB. Currently serving as interim chancellor and provost of the University of Illinois, Easter is chief budgetary officer for the U of I at Urbana-Champaign campus, overseeing all financial programs, policies, and priorities of the campus. Easter began his career at the U of I in 1976 as a professor of swine nutrition and management. In 1996, he was named head of the Department of Animal Sciences, and, in 2002, was named dean of the College of Agricultural, Consumer, and Environmental Sciences (ACES). He has served on boards of directors of the Illinois Biotechnology Industry Council and the Illinois Biotechnology Industry Organization Institute. He was a member of the Vision for Illinois Agriculture Steering Committee, and was appointed by former President George W. Bush to the board of International Food and Agricultural Development, serving as chair in 2007. Easter received his undergraduate degree in agricultural education and a master’s degree in animal nutrition from Texas A&M University.

He completed his doctorate in animal science at the U of I. He and his wife, Cheryl, have three grown children. Minish recently retired as provost of Southern Illinois University (SIU). Prior to that, he served as dean of the College of Agricultural Sciences at SIU. Minish began his career at Virginia Polytechnic Institute and State University. A livestock breeder and judge, Minish has judged more than 60 major shows around the world and he coached the livestock judging team at Virginia Polytechnic Institute and State University for more than 20 years. He also was elected as president of the American Association of State Colleges of Agriculture and Renewable Resources in 2007 and received the Illinois Soybean Association Friend of Agriculture Award in 2010. Minish received his undergraduate degree in animal science from Iowa State University and his doctoral degree in animal science from Michigan State University. He and his wife, Roberta, resided in Makanda until recently moving to Texas. Currently working as a business consultant, former Illinois Sen. Todd Sieben spent nearly 20 years in the Illinois General Assembly. Sieben ser ved in the Illinois House of Representatives from 1987 to 1992 and in the Illinois

Senate from 1993 to 2007. He worked for increased use of renewable fuels, expanding the livestock industry, and protecting agricultural research and business development. Specifically, Sieben successfully championed the Livestock Management Facilities Act, Illinois Family Farmer Support Act, and Illinois Swine Market Development Act. In 2003, Sieben was named assistant Senate Republican leader. He also served as the chairman of the Illinois Senate Agriculture and Conservation Committee as well as numerous other committees having to do with rural life and Illinois agriculture. Prior to serving in the legislature, Sieben served on the Henry County Planning Committee, the Henry County Extension Council, and was involved with the Henry County Farm Bureau. Sieben earned his undergraduate degree in business administration from Western Illinois University, served as a lieutenant in the U.S. Navy from 1968 to 1972 and is a Vietnam War veteran. He and his wife, Kay, have three children and seven grandchildren. IFB’s Distinguished Service Award honors the memory and service of Charles B. Shuman, a revered Moultrie County farm leader who served as president of both IFB and of the American Farm Bureau Federation.

Top: Dr. Robert Easter and his wife, Cheryl, receive the Distinguished Service Award from Illinois Farm Bureau President Philip Nelson. Center: Dr. Gary Minish and his wife, Roberta, receive the award. Bottom: The award is presented to former Illinois Sen. Todd Sieben and his wife, Kay.

Hutjens, Seibert receive IFB Eagle Award for Excellence Dr. Michael Hutjens of Savoy and Dave Seibert of Washington received the 2011 Illinois Farm Bureau Eagle Award for Excellence at last week’s IFB annual meeting. Serving as dairy Extension specialist at the University of Illinois at UrbanaChampaign since 1979, Hutjens has helped countless dairy farmers Michael Hutjens advance productivity and profitability. He has presented at Dairy Days as well as other agricultural and

dairy conferences in 46 states, 15 countries, and nine Canadian provinces. He also has edited the National Dairy Database and Illinois Dairy Report and has written regular columns for dairy periodicals around the globe. Hutjens has received the Illinois Commodity Conference Friend of Agriculture Award; the American Dairy Science Association Award of Honor; the World Dairy Exposition Service Person of the Year; the American Dairy Science Association Fellow Award; the U of I College of Agriculture, Consumer, and Environmental Sciences (ACES) Paul A. Funk

Award; the College of ACES Junior and Senior Extension Award of Excellence; the DeLaval Extension Award; and the Applied Dairy Nutrition Award. He received his undergraduate, master’s, and doctorate degrees from the University of Wisconsin-Madison. Hutjens and his wife, Carol, have five children and two grandchildren. Seibert began his career as an Extension educator in 1968, serving as the assistant and associate Extension adviser for McDonough County. He has served the U of I on several levels, including working as the area livestock adviser and ani-

mal systems educator. He also pioneered numerous programs for the U of I Extension, including 4-H/FFA quality assurance and ethics clinics, Livestock EQuiz, area cow/calf field days, the superior young Dave Seibert producer awards, regional meat-judging workshops, and the Illinois swine environmental assurance series. Seibert has received the U of I CAPE Award, College of ACES professional staff award

for sustained excellence, Extension’s outstanding or innovative team program award, Illinois Pork Producers education award, and is an honorary member of the U of I’s HoofN-Horn chapter. Seibert earned his undergraduate and master’s degrees in animal sciences from Southern Illinois University. He and his wife, Julie, have three grown daughters. The IFB Eagle Award for Excellence provides IFB with an opportunity to recognize individuals or organizations for excellence on issues or programs important to Farm Bureau and agriculture on a statewide and/or national basis.


FarmWeek Page 10 Monday, December 12, 2011

IAITC honors top education volunteers

Pratt wins YL Discussion Meet Katie Pratt, Dixon, will represent Illinois Farm Bureau in the Young Leader Discussion Meet finals at the 2012 American Farm Bureau Federation meeting Jan. 8-11 in Honolulu. Pratt, a member of the Lee County Farm Bureau, won the 2011 state Discussion Meet last week at the IFB annual meeting in Chicago. Last year, she was the runner-up in the state finals. Pratt and her husband, Andrew, have been members of IFB Young Leaders for eight years and farm with Andrew’s family in a corn, soybean, and Katie Pratt seed corn operation. The couple has two children, Ethan, 6, and Natalie, 4. “It’s fun to sit down and talk with other farmers about these topics,” Pratt said of the YL Discussion Meet. “It gives us an opportunity to use our voices constructively, and it keeps us from being isolated on our farms.” The Discussion Meet is an exchange of ideas and infor mation in which contestants must analyze problems and develop solutions in a cooperative manner. Pratt and three other finalists discussed how farmers can convince the public that the animal ag industry balances production efficiencies with the public’s expectations of animal care. “We need to develop relationships with consumers and let them know we’re a trustworthy source” of information about food production, Pratt said. As winner of the Discussion Meet, she will

receive $1,000 cash from IFB, use of a MasseyFerguson tractor courtesy of AGCO, and expense-paid trips to the 2012 AFBF annual meeting, GROWMARK annual meeting, and Young Leader State Conference. The runner-up in the Discussion Meet was Jesse Faber of Livingston County. The other two finalists were Ann Larson, DeKalb County, and Caleb May, Edwards County. IFB promotes and sponsors the Discussion Meet with the goals of developing young peoples’ leadership and communication skills on behalf of agriculture and of working together and to reach consensus on how to deal with current issues in agriculture.

Winkelmann wins ACT Award Kyle Winkelmann, Menard County, won the Young Leaders’ first-ever Farm Bureau Agricultural Contact Team (ACT) award last week at the IFB annual meeting in Chicago. The ACT program this year was expanded to include Illinois Young Leaders. Winkelmann was one of eight individuals who responded to every action request in 2011 and reported his contacts. Kyle Winkelmann Young Leaders held a drawing of the names of the eight individuals, and Winkelmann was selected as the winner of a new iPad. The prize was awarded to show appreciation for Young Leaders who recognize the need for dialogue with elected officials.

Livingston County president honored for legislative work Livingston County Farm Bureau President Dennis Haab last week was awarded an iPad for his legislative work on behalf of Illinois Farm Bureau. Haab received his award at IFB’s annual meeting in Chicago. He was selected from among 108 eligible Farm Bureau members who responded to FB action requests and reported their legislative contacts as part of FB ACT (Farm Bureau Agricultural Contact Team). Sharing farmers’ views with Dennis Haab lawmakers is an important task, according to Haab. “It’s probably one of the most important things that Farm Bureau does,” Haab said. He added legislators told him that constituent con-

tacts influence their decisions. “As a manager, I realize how vital it is for our members to contact legislators. It means so much more coming from a constituent,” said Teresa Grant-Quick, Livingston County FB manager. Haab contacted state lawmakers about the importance of maintaining state sales tax incentives on farm inputs. “The sales tax issue hits home the quickest,” he noted. Some Farm Bureau members may not contact legislators because they’re apprehensive that they’ll be questioned, but Haab pointed out IFB has a DVD that explains the process. “You state your position; your name, address, and phone number; say, ‘Thanks,’” Haab explained. “A couple of minutes out of your time can make a huge impact on issues that affect farmers,” Haab advised fellow farmers.

Wilson wins top certified crop adviser award Mike Wilson, a crop adviser from Allendale in Wabash County, was named the 2011 Illinois Certified Crop Adviser award winner at the Illinois Farm Bureau annual meeting last week in Chicago. The Certified Crop Adviser Award is designed to increase awareness that farmers and their crop advisers strive to do their best to make economically and environmentally sound cropping decisions. Through the Wabash Valley Mike Wilson Service Co., Wilson advises farmers in a 10-county area in Southern Illinois. Wilson has 32 years of crop advising experience, 17 years as a certified crop adviser. He has been a driving force in incorporating

geography-based mapping and soil testing with sound nutrient management. His focus on nutrient management has encouraged his farmer customers to improve their environmental stewardship, and his leadership was a key factor in Wabash Valley’s Browns plant winning a national Environmental Respect Award. Wilson also has been active as a volunteer for 4H and ag literacy with Agriculture in the Classroom in Edwards and Wabash counties. He serves on the Wabash Valley College agricultural department advisory council and is an FFA mentor and record book coach. Wilson was nominated for the state crop adviser award by the Edwards County Farm Bureau. As the state crop adviser winner, Wilson’s name has been submitted for the international award by the Illinois Certified Crop Adviser Board and IFB.

Agriculture literacy leaders and volunteers with the Lee, Mercer, and Fayette County Farm Bureaus were named Illinois Agriculture in the Classroom (IAITC) volunteers of the year for 2011 at the Illinois Farm Bureau annual meeting last week in Chicago. The honorees were Martha Cripe of Vandalia, Fayette County; Andy and Katie Pratt, Dixon, Lee County; and Linda Whitney, Aledo, Mercer County. Cripe has served as the Fayette County Farm Bureau AITC coordinator since 2006 and has contact with 650 students in first through fifth grades at five schools. She collects everything Linda Whitney from grain to sunflower heads Martha Cripe for teaching supplies and refurbishes teaching kits. Under her leadership, the number of schools and grades involved with AITC has continued to grow. She also speaks to community organizations about AITC. The Pratts correspond with a Chicago-area classroom Katie and Andy Pratt through the Adopt a Classroom program and host teachers on their farm during the Bureau, Lee, and Whiteside County Farm Bureau Summer Ag Institute. Katie helps coordinate and teaches at the Lee County Ag Expo that reaches more than 350 fifth graders. Andy helps with set up and dismantling of the expo. This past year, Katie added blogging to her volunteer educational duties when she participated in the pilot IAITC video blog. Whitney has educated about 1,200 Mercer County students in monthly classroom presentations over the past 20 years. In addition, she has brought young pigs to classrooms to assist other AITC presenters. For 15 years, she also has helped with many duties at the county’s annual Agriculture, Environment, and Conservation Camp for second grade students. More than 3,000 students have participated in the camp. Whitney also is a long-time 4-H volunteer, has been a 4-H club leader for 15 years, and served as a county fair superintendent for the past 19 years.

Cook County teacher wins IAITC top award

A fourth-grade teacher from River Forest in Cook County was named the Illinois Agriculture Teacher of the Year by Illinois Agriculture in the Classroom (IAITC). For the first time, the award was presented during the Illinois Farm Bureau annual meeting last week in Chicago. Sarah Fine-Koukol teaches at St. Vincent Ferrer School in the near-west suburbs of Chicago. Students, parents, fellow educators, and community members have been impacted by the agricultural activities Fine-Koukol implements in her classroom. She regularly adds agricultural concepts to subjects ranging from language arts to math and from science to social studies. Her most creative activity involved the Adopt a Classroom program in which her students Sarah Fine-Koukol communicated with their “adopted” farmer through video exchanges as well as written letters. The class of 22 students, plus 24 accompanying adults, took a field trip to their adopted farmer’s farm. Fine-Koukol will be the Illinois nominee for the National Excellence in Teaching Agriculture Award and will receive a trip to the 2012 National Agriculture in the Classroom conference in Loveland, Colo. The runner up was Carl Erbsen, a first-grade teacher at Eastland Elementary School at Lanark in Carroll County. He uses his agriculture background to engage students in yearly farm projects in which they “operate” their farms. Other finalists were: Stacey Brown, Orangeville, Stephenson County; Leanne Hinton, Galesburg, Knox; Bobbie Callmer, Newark, Kendall County; and Vicki Litherland, Wyanet and Buda, Bureau County.


Page 11 Monday, December 12, 2011 FarmWeek

County Farm Bureaus recognized for outstanding program awards Thirty-two county Farm Bureau programs achieved the designation of “Most Outstanding Program” last week at the Illinois Farm Bureau annual meeting. Some of the winning programs already have been featured in FarmWeek or are the subject of upcoming features. The following report provides a brief synopsis of one award-winning program in each of the eight categories. The spokesperson, while integral to the projects reviewed here, is representative of what in many cases were numerous volunteers responsible for the program’s success.

AG LITERACY “Farmers Ag Mag” Brenda Woker, DeKalb County The DeKalb County Farm Bureau built on the success of Illinois Ag in the Classroom Ag Mags by producing its own publication that featured six local farmers. “Given the high success of Illinois Ag in the Classroom Ag Mags, our DeKalb County Ag Mag was developed using a similar format,” Woker said. The publication included articles on how people depend on farmers, how farms and farmers are different, the percentage of family farms, and glimpses into the lives of local farmers. Woker, who is a fourth grade teacher, a Brenda Woker dairy farmer’s daughter, and chairman of the DeKalb County Ag Literacy Committee, helped develop the local Ag Mag and a hands-on lesson connected to it. “The lesson features agricultural products and their ties to different areas throughout the state,” Woker said. “The lesson also gives students a chance to interact with each other while learning more about how agriculture is tied to their lives.” The lesson was piloted in Woker’s fourth grade classroom last winter and subsequently was taught in fourth grade classrooms throughout DeKalb County last spring.

COMMODITIES & MARKETING “Farmer/Retailer Meeting” Carol Meyer, Randolph County The Randolph County Farm Bureau had members interested in selling specialty crops to retailers in the area, so it facilitated meetings with five major retailers in the St. Louis Metro area. A total of 83 specialty crop producers from 21 counties met with representatives of Dierbergs, Olde Tyme Produce, Sappington Farmer’s Market, Schnuck’s, and Sun Valley Foods. “It was a wonderful opportunity to explore ideas pertaining to specialty crops that could benefit growers and consumers,” Meyer said. Carol Meyer The retailers offered to buy two years of products from individuals who could produce items of value. “We were very pleased with the results,” Meyer said. “We finally had (retail) contacts and information” specialty crop growers could access to market their products. The Randolph County Farm Bureau called the program “one of the single-most significant programs we have created. We were able to capitalize on the opportunity (to market local produce) for Farm Bureau members and local specialty crop farmers.”

HEALTH & SAFETY “How Quick Are You?” Jon Boylen, Brown County A new interactive feature was added to a safety day camp to help young students understand the dangers on a farm. Volunteers held yardsticks over students’ heads and the students attempted to grasp the yardsticks as they continued to engage in conversations. The students then attempted to catch a smaller item, a tootsie roll, and compared reaction times. “The exercise showed how quick things happen on a farm,” Boylen said. About 225 grade school students and 15 teachers participated in the safety day Jon Boylen camp and the quickness tests. “The visual demonstration was a lot more effective than if you just tell them (about the dangers of farming),” Boylen

said. “Children need to be taught at an early age to respect equipment and about all of the dangers on a farm.” The event was covered by a local newspaper that went out to about 7,000 readers.

LEGISLATIVE/POLITICAL PROCESS “Mary’s Acre” Deb Moore, Warren-Henderson counties A volunteer from the Warren-Henderson Farm Bureau donated a crop acre to the counties’ adopted legislator so she could learn more about production agriculture. Soybeans were planted on the acre this past season, and volunteers compiled a scrapbook to describe and illustrate what went into producing the crop. “We kept track of everything that went on, we kept track of costs, and took pictures every few weeks,” Moore said. The adopted legislator was able to see the risks associated with production agriculture. Deb Moore “Some of the pictures in May showed flooding, in July there was a picture of a big crack in the field, and in September there were beans lying down (after a windstorm),” Moore said. The profit from the acre will be donated to the legislator’s charity of choice. The acre next year will be planted in corn to demonstrate a crop rotation and the differences in corn and soybean production. Another goal is to get the adopted legislator to visit her acre during the growing season.

LOCAL AFFAIRS “Historical Flood 2011” James Taflinger, Pulaski-Alexander counties The historic flood of 2011 made news headlines for days, but residents of affected areas will be recovering from the devastation left behind for months and even years. In Alexander County, more than 40 percent of farmland (about 20,000 acres) was not planted this year while more than 4,000 acres were not planted in Pulaski County due to floodwaters that poured out of the Mississippi and Ohio Rivers. “That’s going to drag down those counties and hurt the local economy,” Taflinger said. “It’s going to take a couple James Taflinger years to remove or spread all the sand into the soil.” The county Farm Bureau Board responded by working with the local levee district to document the devastation from the flood. Photos of the damage and information about the flood was put into professionally printed booklets that were sent to state and federal lawmakers and government agencies to draw attention to a damaged levee. “The Farm Bureau board decided we needed to talk about the plight of farmers in Alexander and Pulaski counties and get our story out,” Taflinger said. “It turned out to be a fantastic project.” Farmers helped fix two of the four breaks in the nearby levee and more recently the Corps of Engineers released a proposal to complete repairs on the levee.

COMMUNICATION & PROMOTION “Adopt An Acre” Bob Beutke, LaSalle County The LaSalle County Farm Bureau the past four years has educated consumers in the area about production agriculture through an adopted acre program. A local radio station, WCMY in Ottawa, each year adopts two acres and reports each week about the decisions and activities that are required to produce, harvest, and market a crop. The program this year was sponsored by GrainCo FS. “We wanted to teach the non-farming public about what goes on in the farming world,” Beutke said. “We try to convey

the risks we (farmers) face all the time.” Beutke in radio interviews this year discussed his actual costs of production and other risks, such as the 7 inches of rain that fell in three days this past season and flooded the field and required him to replant areas of it. This year the yields averaged about 56 bushels per acre for beans and 188 bushels per acre for the corn, which provided Bob Beutke about $400 per acre in profit. The profit was donated to a local food pantry. “It’s amazing the interest level (in the program) from nonfarm people,” Beutke said. This year he cleared up a misconception that the corn field needed to be detasseled as he explained in a radio interview the difference between seed corn, field corn, and sweet corn. The radio station has a listenership of more than 20,000 people, according to the LaSalle County Farm Bureau. The field is located on a busy road in the county. It is marked with signs so consumers can watch the field activity and crop progress throughout the entire season.

MEMBER RELATIONS “Past, Present, Future – Where Do We Go From Here?” Terry Sturgell, Edgar County The Edgar County Farm Bureau gleaned valuable information from members by hosting six focus groups. There were six groups with about 15 to 20 people in each. The discussions were led by outside moderators who asked tough questions. “The groups came in and brainstormed ideas about what direction Farm Bureau needs to go,” said Sturgell, president of the Edgar County Farm Bureau. The focus groups were made up of two farmer groups, past presidents, agribusiness leaders, land landowners/Farm Bureau members, and Terry Sturgell young farmers. “Two key ideas (developed via information gathered from the focus groups) is we started a Public Relations Committee in the county,” Sturgell said. “And we found some young farmers who were interested in Young Leaders. “Now we have an active group of Young Leaders,” he continued. “When you look at the (county Farm Bureau) board, it’s beginning to transition from older people to younger people. So it’s important we have a pool of future leaders.”

POLICY DEVELOPMENT “Series of Policy Development Meetings with Farmer Image Focus” Randy Farr, Fulton County The Fulton County Farm Bureau is striving to improve the image of farmers, so it focused on that subject at a pair of regional policy development meetings. The meetings drew 138 members who viewed examples of pro-farming commercials and also discussed ways to use social media, blogging, letters to the editor, and YouTube videos to improve the image of farmers and teach consumers about modern farming practices. “It’s important we tell our story to consumers so if they have questions, they can get those answered and if they Randy Farr have misconceptions, we can get more information for them to base their decisions,” Farr said. Fulton County Farm Bureau also placed pro-farming billboards along busy roads to help improve the image of farmers. “We’re always battling the misconception that farmers are only doing it (raising food) for profit,” Farr said. “We enjoy what we do and want to do the very best job we can. We’re trying to produce food not only for the general public but for our own families as well.” The meetings also gave members a chance to discuss policy and local issues, meet the county directors, and give the board direction in setting policy.


FarmWeek Page 12 Monday, December 12, 2011


Page 13 Monday, December 12, 2011 FarmWeek

gOvErnmEnT

Labor Department, grain firm settle lawsuit in fatal bin accident BY KAY SHIPMAN FarmWeek

The U.S. Department of Labor (DOL) and a former grain elevator operator last week announced an agreement in the legal action stemming from two deaths in a July 2010 bin accident. Haasbach LLC, Mount Carroll, was issued 25 citations by the Occupational Safety and Health Administration (OSHA) and child labor penalties by the department’s Wage and Hour Division. Haasbach, which is no longer in business, will pay an estimated

$268,125 in penalties, according to OSHA. Wyatt Whitebread, 14, and Alex Pacas, 19, died after they were engulfed in corn inside a bin at the company’s Mount Carroll facility. Another worker, William Piper, 20, was seriously injured in the accident. “We hope that the deaths of these two young men send a profound and unmistakable message throughout the grain industry that loss of life can and must be prevented,” said David Michaels, assistant secretary of labor for OSHA.

The grain facility remains open and is operated by Consolidated Grain and Barge, which holds the grain license, according to the Illinois Department of Agriculture. At the time of the accident, the workers were “walking down the corn” to make it flow while augers were running. All three became trapped in corn more than 30 feet deep; Whitebread and Pacas suffocated. Since 2009, OSHA has fined grain companies in Illinois, Colorado, South Dakota, and Wisconsin for similar deaths and injuries. In addition, OSHA

Madigan sues co-ops for herbicide damage of preserve Illinois Attorney General Lisa Madigan last week sued two Western Illinois power cooperatives for allegedly damaging a nature preserve via a herbicide application. As part of its right-of-way maintenance, McDonough Power Cooperative hired Spoon River Electric Cooperative in August 2010 to spray a ditch adjacent to the Short Lisa Madigan Fork Seep Nature Preserve in Walnut Grove Township in McDonough County, according to the attorney general. The lawsuit alleges herbicide was discharged by a high-pressure sprayer directly into standing

water in the preserve. “Significant waters and meadows in this protected area suffered serious damage. The destruction and damage to trees, shrubs, and other plants is still obvious one year later,” Madigan said. She is seeking restoration costs and penalties against each co-op of $10,000. Attempts to obtain comments from cooperative spokesmen were not successful. The 41-acre preserve contains high-quality remnants of seep and meadows, according to the Illinois Nature Preserves Commission. Seeps are wetlands with saturated soil that form when groundwater percolates down until it reaches a layer of rock or clay that channels it horizontally. Seeps are most common along the lower slopes of ravines, terraces, and hills.

Federal judges dismiss lawsuit over state legislative map Illinois is cleared for a new legislative map for the General Assembly after a panel of federal judges threw out a Republican lawsuit last week. The judges decided the Republicans were not entitled to a trial based on their claims, according to the Associated Press. The court’s action dismissed

two remaining counts of the lawsuit that alleged racial gerrymandering was exhibited in a House district that joined Springfield and Decatur and that another House district in Chicago diluted the political power of Latino voters. Gov. Pat Quinn had signed the Democrat-drawn map into law in June. Every 10 years, a

national census is conducted, and the results are used to determine the need for new legislative district maps for state and federal elections. Republicans also challenged the state’s newly drawn congressional map. It is unclear when a panel of federal judges will make a decision on that case.

IFF offering answers to consumers’ questions The Illinois Farm Families (IFF) is a coalition of commodity groups for beef, corn, soybeans, pork, and the Illinois Farm Bureau. It is accepting consumers’ questions and posting answers to those questions on its website {www.watchusgrow.org}. FarmWeek is publishing the questions and answers to share information and better prepare farmers the next time they are asked a probing question. Question: What’s high-fructose corn syrup, and is it bad for my family? IFF: High fructose corn syrup (HFCS) is the naturally occurring sugar in corn, which is pulled out and used as a sweetener in processed foods. Just like table sugar is the naturally occurring sugar in the sugar cane plant, pulled out and processed into the sugar you recognize. The American Medical Association says that our bodies process HFCS and table sugar exactly the same way, and that HFCS doesn’t contribute to

obesity any more or less than any other sugar. And according to the Center for Science in the Public Interest, linking obesity rates to HFCS is an urban myth. Q: What are typical work hours for a farmer? Sam Zumwalt, Warsaw: The hours are long. I often work from sunrise to sunset. During planting and harvesting seasons, I rarely get days off. The rest of the year, I try to sell my crops for a good price, fix my machinery, and plan for the next year. I also raise 120 purebred registered Charolais cattle and care for 30 head of Arabian horses. On my farm, the work continues all year round. The live-

stock must be fed and watered every day. I work hard to keep my farm neat and tidy. I also make sure my livestock is safe and healthy. I like being a farmer, despite the long hours sometimes. I like working outdoors and making a living off the land. Q: I’ve seen some of those videos of farm animals being mistreated. How do I know that’s not normal on farms? IFF: Those videos are disturbing, and we want you to know that the vast majority of farmers work hard everyday to prevent any type of animal mistreatment. We want consumers to feel good about the meat that comes from our farms. That means we must raise our animals responsibly — and that starts and ends with humane treatment. Treating animals humanely and keeping them healthy is important to our livelihood. It’s how we produce high-quality pork and beef that feed all our families.

sent letters to more than 13,000 elevator operators warning them not to allow workers to enter grain facilities without proper equipment, precaution, and training. OSHA’s Region V, which includes Illinois, Ohio, and Wisconsin, initiated a grain safety program in August 2010. The program focuses on hazards associated with the grain industry. The department’s Wage and Hour Division found Haasbach violated child labor laws by employing individuals younger than 18 to perform hazardous work that is prohibited by federal law.

Former MF Global chief makes first public comments since bankruptcy, resignation Jon Corzine, former CEO of MF Global, last week made his first public comments about the demise of his firm in testimony before the House Agriculture Committee. And in his testimony, Corzine, a U.S. Senator from 2001 to 2006 and former governor of New Jersey, said he doesn’t know the whereabouts of missing MF Global customer funds that have been estimated to total anywhere from $600 million to more than $1 billion. “I simply do not know where the money is or why the accounts have not been reconciled to date,” he said. MF Global, which was one of the largest futures commission merchants in the U.S., declared bankruptcy on Halloween after the firm’s $6.3 billion bet on European sovereign debt backfired. Corzine resigned within days of the debacle. MF Global and its executives to date have not been charged with any wrongdoing, but an investigation is ongoing.

DATEBOOK Dec. 14 Farm Economic Summit, Best Western Prairie Inn, Galesburg. Dec. 15 Farm Economic Summit, Holiday Inn, Mt. Vernon. Dec. 16 Farm Economic Summit, Doubletree Hotel, Bloomington. Jan. 10 University of Illinois corn and soybean classic, Mt. Vernon Holiday Inn. Jan. 11 U of I corn and soybean classic, Crowne Plaza, Springfield.


FarmWeek Page 14 Monday, December 12, 2011

production

Senators urge pipeline approval, ethanol support BY MARTIN ROSS FarmWeek

Illinois’ U.S. senators last week advocated an “all-of-theabove” approach with respect both to American energy security and future federal energy policies and supports. Meeting with Illinois Farm Bureau members in Chicago, Highland Park Republican U.S. Sen. Mark Kirk reiterated the push for a comprehensive national energy policy. Kirk, who supports construction of a proposed Keystone XL oil pipeline from Alberta, Canada, to the Gulf of Mexico, argued development of both conventional and renewable domestic energy sources is a crucial “part of fixing this economy.” Delegates at IFB’s annual meeting supported efforts to expedite the pipeline permitting process necessary “to bring Canadian crude oil to the United States.” Kirk called the pipeline a “tremendous

job creator,” and blasted the White House’ decision to delay its approval until late 2012. DeWitt County delegate Terry Ferguson stressed the need “to have an energy supply with our next-door neighbor that we can count on.” “We should be able to have it delivered via pipeline, rather than by tanker, truck, and rail,” Ferguson stated. “The president’s put this issue on the back burner, probably until after the next election cycle, but the process has been laid out and the financing is there. This country needs oil, we need construction jobs, and we need jobs that are paid for through private industry, not the government.” In July, the House approved a measure that would have required the administration to rule on the project by Nov. 1. However, groups including Friends of the Earth, Greenpeace, and the National Wildlife Federation fought the bill. Kirk called Obama’s subsequent decision to delay

approval “a tough call,” forcing the president to weigh environmentalist opposition against strong union pipeline support. “He sided with the environmental community, and lost all the jobs that could have been created,” the senator said. Meanwhile, U.S. Senate Whip Dick Durbin, a Springfield Democrat, argued the need for at least a nominally even playing field for both fossil and renewable energy sectors. Durbin noted federal ethanol policy is “clearly being rewritten and reformed, and less money will be spent by the federal government.” IFB delegates pushed to boost the standard ethanol-gasoline blend standard above 10 percent, seeking a “transitional period” that would allow for confident use of higher blends in existing and new vehicles. Producers also urged increased investment in biofuels infrastructure, including funding for “blender pumps” that dispense a range of ethanol blends. Durbin

endorsed steps toward “making more gasoline stations accommodate alcohol fuels and blended fuels,” to foster biofuels demand, as well as efforts to establish ethanol pipeline capabilities. The ethanol industry can accept the need to move on from the soon-to-expire 45cent-per-gallon ethanol blenders tax credit, “as long as it’s done in a thoughtful, phased-in way,” Durbin sug-

gested. “I wish I could hear the same thing from the petroleum industry,” he said. “They want their subsidies to continue despite record-breaking profits by the oil companies in our country. “I think we ought to look at all energy subsidies, figure out where we want to be as a nation, and make the changes necessary to reduce the deficit.”

Chad Daugherty

New IBA Young Producer Council draws statewide interest BY DANIEL GRANT FarmWeek

The future of the cattle industry looks bright in Illinois based on the early success of a new agricultural organization. The Illinois Beef Association (IBA) last summer formed a statewide Young Producer Council (YPC), which subsequently hosted its inaugural meeting in September. YPC attracted 27 young producers to its first meeting, and its newly elected chairman, Chad Daugherty, 29, Cerro Gordo, believes there could be at least twice as many young producers at the next YPC meeting Saturday at Lincoln Land Community College in Springfield. “Expectations are high. We think there will be a lot of people” interested in the upcoming meeting and joining YPC, Daugherty said. “My end goal for the Young Producers Council is to have a large, active group that learns a lot from each other and from different adventures (such as farm and industry tours) we take together.” The council is targeting beef producers in Illinois who are between the ages of 18 and 35 years for membership. But it will accept producers of all ages. The formation of YPC was a top priority of IBA President Jeff Beasley, who last summer was elected to lead IBA. “If we get young producers more involved, then they’ll be more ready to get involved on the state board and in decisionmaking,” Beasley said. Daugherty was elected YPC chairman in September. He manages Blue Ridge Cattle, which is a 200-head red and black Angus cattle operation with locations in Monticello and Carlisle, Ky. “Our emphasis is on cattle that perform well from the pasture to the feed yard,” he said. Daugherty and his wife, Nicole, have a 2-year-old daughter and are expecting another child. “That’s why I’m a big proponent (of YPC and promoting the beef industry in Illinois),” he said. “I want to see this here for our family in the future.” The upcoming YPC meeting in Springfield will offer key networking opportunities along with cattle education and training. Daren Williams of the National Cattlemen’s Beef Association (NCBA) will provide Masters of Beef Advocacy training and Maralee Johnson, executive vice president of IBA, and Curt Rincker, Region 3 vice president of policy for NCGA, will provide training for the Beef Quality Assurance program. More information about the YPC and its upcoming meeting is available online at {www.illinoisbeef.com}.


Page 15 Monday, December 12, 2011 FarmWeek

WEATHER HOW DOES YOUR CROP GROW?

Does warm finish to fall point to a mild winter? BY DANIEL GRANT FarmWeek

Brown County Farm Bureau board member Len Wiese, holding sign, and Sarah Luthy, seated right, wife of Brown County Farm Bureau board member Tom Luthy, explained planting and harvest last week to first graders at Chicago’s Portage Park Elementary School. The Farm Bureau members visited in conjunction with Illinois Farm Bureau’s annual meeting. The Luthys and teacher Niki Liakopoulos have been matched through Farm Bureau’s Adopt a Classroom program for seven years. Liakopoulos toured the Luthy farm during a county visit. (Photo courtesy of Tom Luthy Brown County Farm Bureau)

Auction Calendar Mon., Dec. 12. 10 a.m. Farm Close-Out Auction. Ridgedale Farms, Ltd., SHELBYVILLE, IL. Cory Craig, Auctioneer. www.corycraig.com Tues., Dec. 13. 10 a.m. DeWitt Co. Farmland. James D. Eastham Trust, CLINTON, IL. Haycraft Auction. www.haycraftauctions.com Tues., Dec. 13. 7 p.m. Farmland Auction. Charles and Betty Bland, CISNE, IL. Carson Auction Realty & Appraisal Co. www.carsonauctionandrealty.com Wed., Dec. 14. Unreserved Auction Online Only. bigiron.com Wed., Dec. 14. 6:30 p.m. Bureau Co. Land Auction. KJET Land Investments LLC, PRINCETON, IL. Aumann Auctions. www.aumannauctions.com Wed., Dec. 14. 6:30 p.m. Bureau Co. Land Auction. PRINCETON, IL. Aumann Auctions. www.aumannauctions.com Wed., Dec. 14. 10 a.m. Tazewell Co. Farmland Auction. Earl J. Helm and David J. Helm, MANITO, IL. Palmer Auction Service. Thurs., Dec. 15. 7 p.m. Clinton Co. Farmland Auction. Wilma Monken Estate, HOFFMAN, IL. Daggs Auction Co. www.daggsauction.com Thurs., Dec. 15. 10 a.m. McDonough and Warren Counties Land Auction. Grace Cochran Estate, ROSEVILLE, IL. Van Adkisson Auction Service, LLC. www.biddersandbuyers.com Thurs., Dec. 15. 10 a.m. Ford and Iroquois Co. Farmland. Florence Krull Est., PIPER CITY, IL. Immke and Bradleys’ Auction Service. Thurs., Dec. 15. 10 a.m. Jasper Co. Farmland Auction. Madge Dunn Estate, YALE, IL. Auctions/Realty By Schackmann, Inc. www.schackmann.com Sat., Dec. 17. 10:30 a.m. Farm Machinery. Jim Claybaugh, ELMWOOD, IL. Cowser Auction and Farm Realty. www.cowserauction.com or www.illinoisauctioneers.org Sat., Dec. 17. 11 a.m. Farmland

and Real Estate Auction. Bruce Walker, MCCONNELL, IL. Jim Sullivan Realty, Mike Mahoney and Powers Auction Service. www.powersauction.com Sat., Dec. 17. 10 a.m. Logan Co. Land Auction. Marshall E. Key Estate, MT. PULASKI, IL. Mike Maske Auction Service. www.maskeauction.com Mon., Dec. 19. 10 a.m. Land Auction. Diane G. Atkinson, RANTOUL, IL. Gordon Hannagan Auction Co. www.gordyvilleusa.com Mon., Dec. 19. 10 a.m. Marshall Co. Farmland. Donald Hattan, Dianna Kolb, Duane Cremer and Diane Cremer, TOLUCA, IL. Terry Wilkey Auction Service. www.terrywilkey.com Wed., Dec. 21. 10 a.m. Farm machinery and eq. David and Sharon Sager, SPEER, IL. Rediger Auction Service. www.rickrediger.com Thurs., Dec. 22. 10 a.m. 40 Ac. Cumberland Co. Marilyn Brown, CASEY, IL. Stanfield Auction Co. www.stanfieldauction.com Fri., Dec. 30. 10 a.m. Will Co. Land Auction. Myers Family, MANHATTAN, IL. Richard A. Olson & Assoc., Inc. richardaolson.com Wed., Jan. 11. 10:30 a.m. Winnebago Co. Land Auction. Homer F. Green Trust, PECATONICA, IL. Lenny Bryson, Auctioneer. www.lennybrysonauctioneer.com Sat., Jan. 14. 10 a.m. 67 Ac. Will Co. WILMINGTON, IL. Richard A. Olson & Assoc. Inc. richardaolson.com Sat., Jan. 14. 1 p.m. 146 Ac. Will Co. WILMINGTON, IL. Richard A. Olson & Assoc. Inc. richardaolson.com Thurs., Feb. 2. 158 Ac. Kankakee. Soy Capital Ag Services. www.soycapitalag.com Tues., Feb. 21. 160.87 Ac. McLean Co. Soy Capital Ag Services. www.soycapitalag.com Wed., Feb. 22. 207 Ac. McLean Co. Soy Capital Ag Services. www.soycapitalag.com

The run of cold, snowy winters may come to an end this season if recent weather conditions are any indication of what lies ahead in Illinois. November weather conditions were among the warmest and wettest, according to records dating back to the late 1800s, said Jim Angel, state climatologist with the Illinois State Water Survey. “The month of November had a couple of outstanding features,” Angel said. “It was the sixth-wettest and ninth-warmest on record.” The statewide average temperature in November was 45.3 degrees, 3.6 degrees above average, while precipitation averaged 5.23 inches, 1.9 inches above normal. Precipitation last month was heaviest in Southern Illinois, where some locations received between 8 and 9-plus inches of rain. “We finally got rain on ground that had been so dry for awhile,” Angel said. “Now, about the only dry spot left (in the state) is around Sangamon and Macon counties.” Meanwhile, only isolated areas in Northern and Western Illinois received any measurable snowfall last month. Illinois, particularly the northern half, typically receives its first meas-

urable snowfall by mid- to late November, according to Angel. But the forecast for the next 10 days generally is calling for a continuation of warmerthan-normal conditions with a possibility of more rain. “When you start getting into a weather pattern in late November and early December, it kind of sets the tone for the rest of winter (which officially starts Dec. 21),” Angel said. “And the fact we’ve been on the warm side and precipitation has been rain and not snow, those types of patterns seem to stick around.” Another factor that favors the possibility of a milder winter this year compared to recent years is La Nina (cooler-than-normal water temperatures in the Pacific Ocean) conditions have not materialized as previously predicted. “A couple of months ago there were a lot of dire predictions that this winter would be a lot like last winter (cold and snowy),” Angel said. “But many of those (outlooks) were based on predictions of a strong La Nina. “But instead of being a strong event, so far it’s been a weak to moderate event,” he continued. “So its impact on winter weather may not be as strong as last year.”


FarmWeek Page 16 Monday, December 12, 2011

ag economics 101

Profitability team: IFB should strengthen convergence position BY DANIEL GRANT FarmWeek

It still is not certain whether the improved performance of the wheat contract the past year and a half is the direct result of the implementation of the variable storage rate (VSR) by the CME Group. But one thing is certain — many farmers like what they see so far. VSR took effect in July 2010 to help achieve convergence in the marketplace after the wheat basis bottomed out nearly $2 below the futures price in July 2008. And so far, the problem has showed steady improvement. “Convergence in the wheat market is working,” Doug Yoder, IFB senior director of affiliate and risk management, told the IFB Profitability Advisory Team last week at a meeting in Chicago. “How much credit goes to the variable storage

rate is the question.” The LaSalle County Farm Bureau Basis Committee studied the issue and concluded VSR has been effective enough in the wheat market that it ought to be implemented for corn and soybeans. Basis levels in recent years dipped as much as 80 cents below futures prices for beans and 50 cents below futures prices for corn. “The variable storage rate is more market-friendly, it goes with the ups and downs (of prices),” Darren Walter of LaSalle County told the Profitability Advisory Team. “And we already have VSR in wheat. We need to stay consistent.” A previous proposal by the University of Illinois suggested the corn storage rate at delivery warehouses should be raised, but the CME Group should consider a flat rate for corn and beans rather than the VSR. Yoder noted, regardless of the mechanism used to change rates, raising storage rates at delivery warehouses does not affect commercial storage

rates for farmers. “They’re disconnected,” he said. “Although there is a concern (delivery warehouses) could pass along the costs.” The LaSalle County Basis Committee warned Profitability Team members that even though convergence is better now, problems with a lack of convergence could re-appear later. “We think IFB ought to take a position and form a strategy to try to close the disconnect between the futures and cash market,” said Bob Beutke of LaSalle County. The Profitability Advisory Team decided to recommend the IFB board urge the CME Group to complete a comprehensive review/analysis on the VSR wheat contract. The team also plans to advise the IFB board it prefers an automatic storage rate-setting mechanism, such as VSR, for corn and soybeans rather than a flat storage rate. Long-term, though, Walter and Beutke remain concerned about the overall structure of the market. Grain is priced in

cash markets, futures contracts, and when contracts are settled via shipping certificates. “Most farmers are not delivering to point-source terminals (used to settle contracts on the Illinois and Mississippi

Rivers),” Walter said. “We rely on local elevators for the majority of our storage. “If we’re able to hedge and know there’s coverage, then everybody would be happy,” he added.

Estate tax uncertainty requires flexibility BY MARTIN ROSS FarmWeek

Farm families face myriad uncertainties heading into 2012, from doubts about future ag support to speculation on Congress’ likely move regarding the federal estate tax. A year ago, Congress intervened at the 11th hour to temporarily boost the estate tax exemption to $5 million ($10 million per couple) and reduce the tax rate to 35 percent. If not for that two-year reprieve, farm families would have seen the exemption drop back to a pre-2002 level of $1 million. But as lawmakers seek new sources of federal revenue, farmers could face increased estate tax exposure. Already, one House lawmaker has proposed a return to a $1 million threshold, and President Obama has discussed the possibility of returning to a $3.5million exemption. During a question-and-answer session at Illinois Farm Bureau’s annual meeting last week, U.S. Sen. Mark Kirk, a Highland Park republican, agreed “the ‘death tax’ should be a single-digit, oval number.” Realistically, he admitted he sees estate tax elimination as highly unlikely, suggesting Senate Democrat leaders might agree to extending the existing exemption. “If I were planning, I would plan on the current law continuing,” he told farmers gathered in Chicago. Rick Morgan, Country Financial senior financial security consultant, takes a more cautious approach. Morgan discussed the complexities of farmer preservation during an annual meeting mini-seminar. “We have to plan based on what the tax law is, and then build enough flexibility into your plan so that if the law does change, you hopefully can adapt,” he told FarmWeek. “Unfortunately, if the exemption were to be reduced all the way back to $1 million, that would complicate matters significantly in light of escalating farm real estate prices. “The farming industry’s changed so much that we don’t have a significant number of small farms any more — they’ve tended to be consolidated. As a result, (even) a $3.5-million exemption would catch quite a few farm families, even with the use of ‘special use’ legislation to reduce the value of farm real estate for estate tax purposes.” Morgan nonetheless noted a few strategies for minimizing tax exposure or maximizing exemptions. Gifting a portion of assets to potential heirs is a traditional option, though each farm spouse is limited to $13,000 in gifts per individual per year — given inflation, a relatively minor allocation of assets especially for a larger farm. Congress has “reunited” estate and gift tax exemptions through 2012, theoretically enabling individuals to gift up to $5 million taxfree during their lifetime. But questions remain about possible tax treatment of those assets after the donor’s death; Morgan urged families to consult a legal or financial adviser before considering such a transfer. Tax liability also may be reduced by balancing estate values between spouses. But where in the past each spouse’s allowable federal exemption had to be used at his or her death, a surviving spouse over the next year may capture the unused portion of the previously deceased spouse’s exemption. For example, a farm couple is allowed a combined $10 million exemption. If only $3 million of the exemption applies at the death of one spouse, the survivor currently would be allowed $7 million in exemption value. If a family can’t make the tax “disappear” through advanced planning, financial liquidity is crucial, especially at the time of a surviving spouse’s death, to ensure taxes can be covered without selling inherited assets. Life insurance is a possible option “to generate capital at death,” said Morgan. “Life insurance generally is going to be free of any income tax, so we can use it to create some tax-free dollars,” he said. “We’re getting the premium dollars out of the estate as we are paying for that policy, and that helps reduce the value of the estate a little bit.”


Page 17 Monday, December 12, 2011 FarmWeek

brazil

Some Brazilian soy planting slow; more GMO crops coming BY PHIL CORZINE

I’m at our Tocantins far ms this week, where planting is advancing very slowly due to the nearly daily rains, courtesy of La Nina. Tocantins is nearly the last area in Brazil to start planting, and if these rains continue, we may be finishing up our Phil Corzine last fields in calendar year 2012. On our owned and rented farms, we have about a third of our

from the counties

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ASALLE — Far m Bureau seed plot result booklets are available on the website {www.lasallecfb.org} or at the Far m Bureau office. EE — Voting members have received their ballots for election of the board of directors and a proxy if they can’t attend the annual meeting on Jan. 19. Return ballots and proxies by Jan. 5 to the Farm Bureau office. • The application deadline for the Lee County Farm Bureau Foundation “Books by the Bushel” program is Feb. 1. The county Farm Bureau will give books to organizations that can benefit from a bushel basket of agricultural books. Applications are available on the Farm Bureau website {www.leecfb.org}. Call the Farm Bureau office at 815857-3531 or e-mail leecfb@comcast.net for more information. ONTGOMERY — Montgomery County Farm Bureau Foundation will award six $1,500 scholarships. Deadline for applications is noon Monday, March 12. To qualify, the student’s parents or the student must be a Farm Bureau member and the student must be pursuing an agricultural field of study. Visit the website {www.montgomerycountyfb.com} or call the Farm Bureau office at 217-532-6171 for more information.

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M

“From the counties” items are submitted by county Farm Bureau managers. If you have an event or activity open to all members, contact your county Farm Bureau manager.

5,100 acres planted. Overall, Brazil is said to have more than 90 percent of its soybean crop in the ground as of Dec. 5, with the area planted to soybeans increasing by 4 percent in Brazil this year. The state of Tocantins is having a big year, with planted area up 12.8 percent. Tocantins is now planting an area equal to the state of Tennessee. The increase is due, in part, to improving infrastructure, but more so to the expansion of areas planted to sugar cane and cotton in the south.

Southern state soybean far mers are renting out or selling, then buying or renting land in Tocantins to convert pastures into soybean fields. We planted 250 acres of corn this year using a twogene stack with the Roundup-Ready and Bt traits. We split our fields between DeKalb and Pioneer, and our seed cost was

$220 for a 60,000-kernel bag. The majority of our soybeans also will be Roundup-Ready varieties again this year. We have been growing Monsoy varieties (a Monsanto brand), but this year we are adding two varieties from Pioneer. Our Monsoy RoundupReady seed cost $24 for 50 pounds of seed, while the

Pioneer varieties averaged $31. Pioneer, however, includes the tech fee in the price, while we have to pay Monsanto another $5.60 per bag in January for the technolog y fee. Overall, Brazilian far mers are expected to plant 85.3 percent of their fields using GM technolog y, which is up 16 percent from the last crop. Phil Corz ine is general manager of South American Soy, a global production management and investment company. His e-mail address is pcorz ine@ag page.com.


FarmWeek Page 18 Monday, December 12, 2011

profitability

All we want for Christmas ... BY CHUCK SPENCER

The holiday season always brings to mind presents. Our imaginations run with thoughts of what we would like to give and receive as gifts. What if we were all to receive policy presents this year? What would you have on your wish list? A good policy present list would have to include some basic actions we need in agriculture and our country. A big box for infrastructure programs makes the list. One mode of transportation in glaring need of immediate improvement is our waterway system. The Mississippi and Illinois Rivers have 600-foot locks in a 1,200-foot world. We watch the Panama Canal being modified to handle Chuck Spencer ships three times the size of the current vessels in use on budget and on time. We have languished more than 20 years to construct seven new 1,200-foot-long lock chambers on two rivers in the Midwest. This present would have to make the top of the list. Farm policy was supposed to be wrapped up with a big bow on top by now in the deficit super committee’s recommendation for resolving our national spending challenge. However, this present will not make it under the tree this year. Farm policy will now go from super status to regular order in a presidential election year. Farm groups will be working very hard proposing the best risk management program for their cropping sector. It will be very important in the end for all commodity and farm groups to work together as one when the farm bill goes to the floor of both the House and Senate. If agriculture is less than united behind a farm bill proposal, we may receive a present we wish we hadn’t in 2012. With all that is going on for the election, will it be 2013? Stocking stuffer ideas would have to include an “Hours of Service” exemption for agricultural supplies, exempting cooperatives from the costly regulatory oversight that is meant for large financial firms, and relief from the National Pollutant Discharge Elimination System (NPDES) permit for pesticide applications. What list of holiday policy presents would be complete without resolution to our state’s budget challenge? For Illinois, this may be one of the most wished-for presents of the season. Make 2012 a productive year, and make something happen with these policy gifts.

Chuck Spencer is GROWMARK’s director of government affairs. His e-mail address is cspencer@growmark.com.

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 $35.19-$58.00 $42.73 $57.00-$60.00 $58.42 n/a n/a This Week Last Week 29,597 25,492 *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 $80.75 $82.20 $59.76 $60.83

Change -1.45 -1.07

USDA five-state area slaughter cattle price Steers Heifers

(Thursday’s price) (Thursday’s price) Prev. week Change This week 122.28 127.33 -5.05 121.46 125.84 -4.38

CME feeder cattle index — 600-800 Lbs. This is a composite price of feeder cattle transactions in 27 states. (Prices $ per hundredweight) Prev. week Change This week $144.86 144.60 .26

Lamb prices Slaughter Prices - Negotiated, Live, wooled and shorn 105-150 lbs. for 160.17-175 $/cwt. (wtd. ave. 167.71); dressed, no sales reported.

Export inspections (Million bushels) Week ending Soybeans Wheat Corn 12-01-11 31.6 14.5 38.5 11-24-11 41.8 16.5 36.1 Last year 48.4 21.6 28.4 Season total 428.3 533.5 400.1 Previous season total 639.0 575.5 445.8 USDA projected total 1375 975 1600 Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

Farm input prices could set records BY DANIEL GRANT FarmWeek

U.S. farm input prices this year are projected to surpass the $300 billion mark for the first time in history. USDA last month projected total farm expenses this year would total nearly $320 billion. If realized, farm expenses in 2011 would be up $34 billion (12 percent) compared to last year. To put that number ($34 billion) in perspective, total government farm payments ($10.6 billion) this year are projected to total less than one-third of the recent increase in input prices. “We’re seeing very dramatic (input) price increases,” Mike Doherty, Illinois Farm Bureau senior economist and policy analyst, told FarmWeek. And the trend of higher input prices is projected to continue into next year, according to Doherty, who last week provided an input price outlook to the IFB Profitability Advisory Team during the IFB annual meeting in Chicago. Farm diesel prices this year are up 30 percent compared to a year ago while the cost of

anhydrous ammonia and urea have climbed 65 percent and 50 percent, respectively, since January 2010. Elsewhere, oil prices early last week hovered around $101 per barrel for U.S. crude (up $11.90 from the same time last year) while Brent crude, which is sourced from the North Sea, was about $109 per barrel, the Energy Information Administration reported. “Input prices not only increased year-over-year by a range of 30 to 65 percent, but many forecasts are calling for further increases between now

and planting time,” Doherty said. “With crop prices (in recent months) subsiding from some high levels at times in 2011, we’re definitely squeezing margins,” the economist noted. Doherty recommended farmers keep a close eye on their cash positions in the coming year and strongly consider the possibility of lower crop prices and higher input costs when they negotiate inputs and cash rental rates for 2012. “It looks as if pre-ordering (inputs such as fertilizer) may pay this year,” he added.

USDA raises ending stocks, lowers price forecast The outlook for crop prices, which have been trending down in recent months, got a little more bearish Friday following the release of the USDA December crop report and supply/demand estimates. USDA raised ending stocks by 50 million bushels for wheat, 35 million bushels for soybeans, and 5 million bushels for corn. “(Traders) were looking for an increase in beans and wheat (ending stocks), but got more than expected,” said Clayton Pope, AgriVisor manager. “And for corn, (traders) expected ending stocks to be reduced, but USDA raised it, slightly. It just added to the negativity.” Ending stocks for Clayton Pope 2011/12 currently are projected at 848 million bushels for corn, 230 million bushels for beans, and 878 million bushels of wheat. USDA on Friday also raised its production projections for all three crops worldwide, including a forecast for record corn production. “The fear of us running out of corn this crop year seems to be off the table,” Pope said. “If you look at the stocks-to-use ratio, we’re still amazingly tight,” he continued. “But the markets are all about perception. For months we’ve been running on razor-thin

(crop supplies) and now we have at least a little breathing room.” Meanwhile, USDA lowered its export projections by 50 million bushels for wheat and 25 million bushels for soybeans. Crop price prospects, not surprisingly, took another hit on Friday. The 2011/12 season-average farm price ranges in the December report were projected at $5.90 to $6.90 per bushel for corn (down 30 cents), $10.70 to $12.70 for soybeans (down 90 cents), and $7.05 to $7.55 for wheat (down 20 cents). Pope believes the outside markets will continue to be a strong influence on the markets near-term, and lately that hasn’t been a good thing. The MF Global bankruptcy and the European debt crisis have had a bearish impact on commodity markets, Pope noted. The next key report will arrive next month when USDA finalizes its crop production and yield estimates for 2011. “(USDA) can make some big changes, still,” Pope added. “But I’m not looking for anything dramatic.” USDA in November projected U.S. corn production this year would total 12.3 billion bushels for corn, with an average yield of 146.7 bushels per acre, and bean production was pegged at 3.05 billion bushels, with an average yield of 41.3 bushels. — Daniel Grant


Page 19 Monday, December 12, 2011 FarmWeek

PROFITABILITY Corn Strategy

C AS H ST RAT E GI S T

Grain supplies get bigger And the pile just keeps getting bigger. Not surprisingly, USDA added a total of 10 million metric tons (mmt.) to world grain ending stocks with its December forecast. The increase was nearly equally split between wheat and coarse grain, the former increasing 6 mmt. and the latter 5 mmt. Rice stocks were revised down 1 mmt. The trade should have had an inkling that grain supplies might be boosted in this report. Two weeks ago, the Chinese forecast a record corn crop, one beyond anyone’s expectation. And this last week, the Australians increased the forecast size of their wheat crop to 28.8 mmt., a new record by a considerable margin. There have been other less notable increases in other countries as well. Still, the supply of grain is not what one would call burdensome, with the stocks-to-use ratio still only 20 percent. Wheat is by far the most plentiful with a stocks-to-use ratio at 30 percent, while the coarse grain ratio is still at a relatively tight 14 percent. But as we have said for months, it’s the supply of wheat that has become a big issue in the world coarse grain trade. And as long as feedquality wheat continues to trade at a discount to corn, demand for our corn, and everyone else’s, is going to remain weak. Just this past week, feed wheat was still trading as much as a $1 per bushel discount to corn coming out of the U.S. Gulf. On Friday, China announced it was going to buy up to 12 mmt. of corn from its producers for government reserves to support prices going into the late January Lunar New Year holiday.

But at the same time, the Chinese continue to import significant quantities of feed wheat from other countries for feeding. If it weren’t for that supply of wheat, the Chinese probably would be using these lower prices to buy corn from us or other countries for commercial use, or even government inventories. But the economics say wheat is the better bargain. And that will persist until something changes the wheat fundamentals enough to bring an end to wheat feeding, or corn prices fall far enough to reduce wheat feeding. As it is, USDA raised its wheat feeding forecast another 3.5 mmt., all outside of the U.S. The 130 mmt. forecast is a new record by a large margin, and represents a 15 percent increase in the last year, mitigating the demand for coarse grains to feed. Fundamentally, the oilseed forecasts are relatively strong compared to grains. The 75.49 mmt. stocks projection for all oilseeds, and 64.54 mmt. for soybeans, can only be termed slightly comfortable. But as long as the South American crop potential remains reasonably good, there seems to be a lack of urgency for end users to push coverage forward. Even Chinese business has been mostly benign the last few months, with few daily reports of Chinese soybean purchases. But it is early in the South American growing season, and we do have a mild La Nina occurring in the Pacific. That tends to correlate with possible dry weather in southern Brazil and Argentina. One would expect to see at least a “crop scare.” But the impact could be muted if the industry is talking about larger U.S. plantings in 2011 at the same time. And as we outlined last week, that’s a distinct possibility, not only for soybeans, but other crops, too.

Cents per bu.

ü2011 crop: A close below $5.85 on the March contract opens the door for prices to test $5.50-$5.60. Hold off on selling weakness and wait for a rebound, but prices may not get to an acceptable sales level until the new year. Hedge-toarrive (HTA) sales for spring/early summer delivery are the best marketing strategy for farm-stored grain, especially with the recent spread widening. Commercial storage is a closer call depending on your storage rate. Compare your options with those inventories. ü2012 crop: Hold sales at 20 percent. Depending on how deep prices decline in the short term, we could recommend buying call options against sales on the books, and ones we plan for the winter. HTA contracts are still the best tool for making sales at this time, but we’d use forward contracts if the basis is good. vFundamentals: The latest USDA report added to the bearish tone because of more comfortable domestic and international fundamentals. Even more damning for prices was the significant increase in wheat supplies around the world.

Soybean Strategy

ü2011 crop: The post-USDA report action may have ended any catch-up selling opportunities. But if January futures rebound to $11.50 by year’s end, make catchup sales. A HTA sale for spring delivery for farm-stored soybeans has become more attractive with the spread widening. Compare your alternatives for commercial storage. ü2012 crop: Given the post-report break, there may not be a catch-up selling opportunity. But we are not comfortable selling weakness at this time. For new-crop sales, we prefer HTA contracts but would use a cash contract if the basis level is good. vFundamentals: Even though prices continue to slip, soybean fundamentals are not that negative. And they remain cheap relative to other grain. And with a mild La Nina under way, there’s a good chance for a “crop scare” at least for the Brazilian/Argentine crops.

But given that Chinese demand is steady at best and our crush margins are poor, we wouldn’t expect to see a major move higher this year.

Wheat Strategy

ü2011 crop: Short-term momentum suggests additional weakness. Prices could drop below the Chicago March $5.86 low. We don’t want to sell weakness, but the next selling opportunity may not come until the new year. The carry in futures still pays for commercial storage, making spring HTA contracts the best tool. ü2012 crop: New-crop

sales currently are 20 percent complete. Use a rebound to $6.40 on Chicago July futures to make a catch-up sale. vFundamentals: The latest USDA report confirmed abundant supplies in the U.S. and the world. Smaller export forecasts accounted for the 50-millionbushel increase in ending stocks to 878 million. Countries continue to source wheat cheaper from the Black Set region. And now Australia is becoming a stronger force. World wheat ending stocks were bumped up to 208.52 million metric tons from 202.6 million.

Cash Strategist sales recommendations AgriVisor endorses crop insurance by

Beans '11 '12 9/13/10 10% 10.27 8/29/11 10% 13.50 10/11/10 10% 11.54 11/15/11 10% 11.99

AgriVisor LLC is not liable for any damages which anyone may sustain by reason of inaccuracy or inadequacy of information provided herein, any error of judgment involving any projections, recommendations, or advice or any other act of omission.

Policies issued by COUNTRY Mutual Insurance Company®, Bloomington, Illinois AgriVisor Hotline Number

309-557-2274

4/25/11 10% 13.76

9/13/10 10% 4.61

8/29/11 10% 6.65

10/11/10 10% 5.28 11/15/11 10% 5.671/2 1/24/11 10% 5.87

1/31/11 10% 13.31

AgriVisor LLC 1701 N. Towanda Avenue PO Box 2500 Bloomington IL 61702-2901 309-557-3147

Corn '11 '12

80% unsold

4/25/11 10% 6.76 80% unsold

Wheat '11 '12 7/13/10 10% 6.00

7/30/10 10% 6.98

5/31/11 10% 6.79

8/6/10 15% 7.35

8/1/11 10% 13.71 11/15/11 10% 11.99

8/1/11 10% 6.77 11/15/11 10% 6.45

8/8/11 10% 6.68

30% unsold

30% unsold

Prices are new crop or nearby futures

Prices are new crop or nearby futures

5/26/11 10% 13.75

1/2

11/17/11 20% 6.343/4

7/21/10 15% 6.60

11/17/11 20% 6.30 20% unsold Prices are new crop or nearby futures

80% unsold


FarmWeek Page 20 Monday, December 12, 2011

perspectives

Ag production, exports remain U.S. economic super star Recently, we learned farm income in 2011 is forecast to reach an all-time high, up 28 percent over 2010, signaling that American agriculture remains a bright spot in our nation’s economy. The growth in farm income also is making a real difference for America’s farm families SCHERRIE whose household GIAMANCO income was up 3.1 percent in 2010 and is forecast to increase 1.2 percent in 2011. And despite marginal increases in retail food prices, all American families still pay substantially less for food at the grocery store than residents of nearly every other country thanks to the productivity of our farmers. All told, this is good news for our national economy. A combination of factors has made this growth possible, including strong returns on cash receipts and off-farm employment, strong yields despite weather setbacks, and record high farm

exports that continue to make U.S. agriculture one of the only sectors of our economy to log a trade surplus year after year. Today, exports support nearly 10 million American jobs. Overall, U.S. agriculture supports one in 12 American jobs in all sorts of industries from picking and processing to packing and shipping to shelving at your local market. Farm exports support more than 1.1 million jobs here at home. A few weeks back, President Obama signed into law a major piece of his jobs agenda — new trade agreements with Colombia, Panama, and South Korea. These agreements will support tens of thousands of jobs here at home, put unemployed Americans back

to work, and open new opportunities for American businesses. For America’s farmers and ranchers, the trade agreements provide their best opportunity to build upon what has been a record year for U.S. agriculture. Combined, the agreements will generate an additional $2.3 billion in farm exports next year alone. USDA believes America needs an economy that makes, creates, innovates, and exports. There is no better way to spur productivity than by putting more money back into the pockets of American families. The current payroll tax cut has given tax breaks to millions of families across the country this year, and now Congress is deciding whether it should be extended in 2012.

If the current payroll tax cut is not extended, taxes will go up on millions of people at a time when families are struggling to make ends meet. A typical household earning $50,000 a year will see its taxes increase by $1,000. The administration’s plan would give the typical family earning $50,000 a year an additional $500, for a total tax cut of $1,500, providing assistance to middle class families at a time when many are still trying to get back on their feet. For our part, USDA will continue to maintain a strong farm safety net, expand local and regional food systems, and promote greater export opportunities for U.S. agriculture — all designed to increase incomes for America’s farm families. But to help rebuild an economy that restores security for the middle class and renews opportunity for folks trying to reach the middle class, we also need to invest in the middle class. Scherrie Giamanco is state executive director of the Illinois Farm Service Agency.

Friends of spiders, please stand up Most people don’t harbor fond feelings for the creatures known as spiders. In fact, as a group, spiders are probably the least-liked of all arthropods. And that is saying something. None of the other common arthropods — insects, ticks, mites, scorpions, lobsters, crayfish, and pillbugs — ranks very high on the human likeability scale, either. When it comes to fondness for other animals, we humans are partial to creatures that are more like us. You know, warmblooded and hairy. We love these kinds of aniTOM TURPIN mals and even keep some, such as dogs, cats, and the occasional rat, as pets. We spend all kinds of money on our mammal pets, providing fancy food, veterinary care, special toys, and even grooming. We also like birds. Some of these fine-feathered creatures occupy favored perches as human pets. As we do with our mammal pets, we are willing to put our money where our attitude lies. Anybody purchased a birdhouse or birdseed lately? On the other hand, arthropods are coldblooded, have a hard exoskeleton and don’t come when you call, roll over on command, or like to be petted. These joint-legged creatures are small and that makes them hard to see as well. Consequently, we begin to imagine things that we can’t see with our own eyes. And, worst of all, some arthropod species add human injury to insult by biting, stinging, and transmitting diseases. So for most people, insects or spiders are the big No. 1 on their “animals I don’t like” list. And in my experience, spiders have the rather dubious honor of topping such a list more often than insects. Spiders and insects share many structural characteristics. However, spiders are different from insects in that they appear to have two body sections rather than three, have eight legs rather than six, and lack antennae. In the United States, some 3,000 species of spiders have been given scientific names. Spiders live in all kinds of habitats and all prey on insects. So if you don’t like having insects around, you’ve got to love spiders. So how do spiders catch their prey? Common

names of spiders sometimes will tell that story. Most people are familiar with spider webs. All spiders have the ability to produce silk, and many species use the material to construct their namesake traps to capture insect prey. Orb weaver spiders produce what most people recognize as a spider web consisting of support lines with the connecting strands spiraling outward from the center. The large black-and-yellow garden spider that hangs upside down on the web is an orb weaver. This is one of the larger spiders in the United States, and it has the interesting habit of eating the remains of the web and building a new one each night. Other spiders that use silk to capture prey include the funnel web weavers. These spiders produce a characteristic funnel from silk. The funnel leads to the lair of the spider. At the front of the funnel is a barrier that serves to knock flying insects onto the funnel where the waiting spider captures its prey. The American house spider also produces webs. This spider lives in corners of houses and barns where its webs not only catch insects but also dust. These are the cobwebs that are the inspiration for the common Halloween decorations and the bane of homeowners. The other major group of spiders is called hunting spiders. These spiders capture their prey without the use of silk, and some have names suggestive of hunters: wolf spiders, fishing spiders, lynx spiders, and huntsman spiders, to name a few. Hunting spiders include some of the largest spiders — the tarantulas. While some tarantulas have a dangerous bite, those living in the Southwest have a bite no more dangerous than a bee sting. Because of their size, these spiders sometimes feed on other small animals, including lizards. One very large tarantula is called a bird eater because it will catch and eat small birds. All spiders have poison glands and a pair of fangs, called chelicerae, through which poison is delivered to the prey. The fangs also can be used for a defensive bite. But spider bites to humans are rare — we’re much too big to be a food item for an itsy bitsy spider!

Tom Turpin is a professor of entomology at Purdue University, West Lafayette. Ind. His e-mail address is turpin@purdue.edu.

Stanley is a hobby farmer

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FarmWeek December 12 2011  

FarmWeek December 12 2011

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