Crn140909 east

SEPTEMBER 2014

IS NO TILL FINISHED? NO WAY, SAYS BLAKE VINCE. FOR 2015, HE SEES NO TILL PAYING BETTER THAN EVER

PHILIP SHAW SAYS: WATCH JANUARY USDA REPORT COMING SOON? 10 MILLION ACRES OF PRAIRIE CORN

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SEPTEMBER 2014

PAGE

Corn in the ‘real’ east Saying yes to no till Watch the market’s timing Exploding in the West A market for your cobs Conservation versus vertical tillage

4 8 13 17 20 26

What the world doesn’t know

W

e really should nickname it the impossible crop, because it’s impossible to imagine the shape of Ontario agriculture today if this wild Mexican grass hadn’t been tamed and traded by hundreds of generations of native farmers, or if it hadn’t been hybridized in the 1930s.

Will it soon be impossible to imagine the Prairies without corn as well? And the Maritimes?

The productivity of corn — and of the farmers who grow it — is nothing short of stunning. Consumers don’t understand this. When they think of farmers, ideas of productivity and efficiency don’t come even remotely to mind.

But think of just a few examples. Consider for example, how North America’s farmers now send as many bushels to ethanol plants as they grow for feed, and how they do this without shorting any other markets.

Consider also how farmers rebounded from the worst drought in a century in two short years, and have built up surplus stocks again.

Consider too how breeders have built astonishing yields into today’s seed, and then consider how a business-smart company like Monsanto can bet that Western Canada’s farmers will be growing eight million to 10 million acres within 10 years.

Corn Guide, September 2014

Consider as well how corn farmers saved consumers from the food inflation that the world’s media foretold just last year, and consider how corn — and the livestock that will be grown from it — is the core meaning of progress for China’s rising middle class.

Then consider that, as they read this, Canada’s corn farmers are heading out to the Outdoor Farm Show, they’re getting ready to monitor corn yields, and they’re planning a winter full of research and investment all so they can do an even more productive job of growing corn next year.

Who could ever have dreamed that corn farmers could achieve this much?

It isn’t only China’s economic hopefuls. The entire world doesn’t know that it has decided to rely on corn and on the farmers who produce it. Nor would they believe us even if we showed them incontrovertible numbers and a mile-thick stack of studies.

But the world did somehow decide to build its future on corn, and it did decide to pin its collective hopes on the skill and the dedication of its corn growers.

And it turns out, the world was right.

How utterly, impossibly crazy is that?

Tom Button, CG Editor tom.button@fbcpublishing.com 3

Cornguide

Corn in the ‘real’ east Farmers like Nicholas de Graaf are why Nova Scotia is a happening place these days

By Ralph Pearce, CG Production Editor

M

aps might show the way our country actually is, but not the way we think about it. To many grain and oilseed farmers in Ontario, for example, Canada might as well stop at the far Quebec border, where la belle province butts up against the Maritimes.

Heck, to be honest, many Ontario farmers wonder if their kind of agriculture doesn't actually stop at the near border, where Quebec and Ontario meet (or fail to meet, as the case may be).

And make no mistake, their myopia can seem justifiable. After all, most of Eastern Canada’s highest-yielding and most-intensively farmed operations are in southern Ontario, as are most of Eastern Canada’s agribusinesses, and the lion’s share of its research spend, including at the University of Guelph.

And of course, if Ontario thinks agriculture stops at Quebec, that’s nothing compared to Western Canada, which is inclined to ask if agriculture survives east of Winnipeg at all.

The problem is, those old stereotypes can blind the rest of the country to some of the very interesting things going on in some quite unexpected places, including a quiet corner of Nova Scotia.

A grain and oilseed awakening is underway in parts of the Maritimes. Since the mid- to late 2000s, potato farmers on Prince Edward Island have been boosting their soybean acreages, and an increasing number of farmers in Nova Scotia have been adding corn and soybeans to their operations. According to Statistics Canada figures from 2011, corn acres in Nova Scotia have increased 77.4 per cent since 2006. Soybeans were three times their 2006 level.

Of course, that still left corn at a mere 13,701 acres, and soybeans at 8,776. But those numbers can be deceiving, as you’ll see.

Why wait for infrastructure?

It’s in this setting that Nicholas de Graaf, who farms in the Annapolis Valley, west of Halifax, is forging his own path. For roughly seven years, de Graaf has been growing a three-crop rotation of corn, soybeans and wheat, moving closer to self-sufficiency for the feed his operation needs while also building a reputation as an innovator and early adapter.

De Graaf works his home farm of 150 acres near Canning and also owns land near Centreville and the surrounding area, for a total of roughly 480 acres. On top of that he rents nearly 800 acres dotting the region as far away as Blomidon to the northeast, and Billtown to the west.

4

Corn Guide, September 2014

Not surprisingly, his soil types vary almost as much as the different terrains he manages, from some sandy loam on his home farm to the heavier clays on some of his rented ground.

“Originally, we were a poultry farm — chickens and turkeys — and when I came home to the farm, I decided that I wanted to build a feed mill,” says de Graaf, who returned to the farm after earning his degree in agricultural economics from Nova Scotia Agricultural College.

“Once I built the feed mill,” he continues, “it became pretty evident that I should be growing some crops to put into the feed mill, so I’m self-sufficient for all of my production in corn.”

To add to that initiative, de Graaf put in a soybean extruder to enable him to feed his own soybeans without first having to take them off farm. Today, he estimates he’s between 55 and 60 per cent self-sufficient with his soybeans. As for his wheat, since he’s self-sufficient with the other two, he grows wheat primarily as a rotation crop, selling the harvested grain while keeping the straw for bedding.

Photo: light and lens

With his average yields approaching 150 bu./ac. thanks to new genetics, corn has earned the right to be a permanent part of his diverse operation, de Graaf says. “It’s a whole different world now.”

Corn Guide, September 2014

“At first, I just started growing wheat before I even had the feed mill, putting it into a commercial ration and diluting it,” says de Graaf, adding that such a practice was commonplace 10 years ago or longer, and is still used on some poultry farms today. “Then once I built the feed mill and realized I could actually use the ingredients directly, I started into corn and then soybeans after that.”

For the 2014 growing season, de Graaf has 790 acres of corn, 520 acres of soybeans and 150 acres of wheat. Again, his corn production means he has self-sufficiency for his poultry operation, but he could grow up to 700 acres of soybeans to reach self-sufficiency on that crop. He’s also constructed enough storage capacity that he can store the entire year’s crop needs for the poultry operation — roughly 3,000 tonnes.

Continued on page 6

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Continued from page 5

All he needs now is some more land.

That level of self-sufficiency means de Graaf hasn’t had to wait for the fledgling grain infrastructure around the Maritimes to size up, although in 2009, as more growers showed interest in growing soybeans, processing facilities began to pop up, including sites at Belle River, P.E.I., Sussex, New Brunswick and Lawrencetown, Nova Scotia.

But just as soybean and corn production has been slow to increase in the northern Ontario districts of New Liskeard or Thunder Bay, it’s that lack of processing facilities, compounded by high shipping costs that has stemmed any big jump in corn and soybean acres farther east.

It’s beginning to change, but whether they’re located on P.E.I. or in New Liskeard, the farms that are planting corn and soybeans still tend to be operations that can feed what they grow, the same as de Graaf.

The eastward migration of corn and soybeans, however, has been made all the easier by the development of shorter-season varieties and hybrids and the lowering of heat unit requirements. That shift, says de Graaf, has helped drive the profitability of his own operation.

Yet there is one aspect of Maritime corn and soybean production that lags behind Ontario, Quebec and the West. It’s crop insurance, which de Graaf does not purchase. Simply put, Nova Scotia’s government is far behind on its yield averages — two tonnes per acre for corn, or about 75 bu./ac.

For de Graaf, whose average corn yield is 3.73 tonnes per acre (147 bu./ac.), roughly half his crop would have to fail before he’d be able to collect on a claim.

“So it makes no sense at all for me to do anything as far as insurance goes,” de Graaf says. “But that’s the reality. When people used to grow corn, there wasn’t a lot of grain corn anyway, and when they did grow it, that two tonnes per acre was their expected yield 15 years ago. It’s a whole different world now.”

Early adapter and innovator Although de Graaf doesn’t see himself as an innovator, he has cer tainly embraced many of the modern tools employed in other parts of the country.

He relies on Barry and Paul Raymer of Practical Precision in Tavistock, Ont., for agronomic advice and has adopted both GPS and GreenSeeker technologies.

“When I started farming crops, my 6

“ I don’t consider myself innovative, but everyone tells me I am.”

— Nick de Graaf

father was a chicken farmer and he just rented out the land for 30 years, and I really had no one in the family to draw from as far as cropping experience went,” says de Graaf, adding that his first tractor was equipped with a computer. “But that was recording all the time that was spent, and basically, it was to get costing, not use the GPS for driving. And I’ve continued that right until today — at any given time, I can tell you exactly how much I’ve spent on my crop this year, and I can go back to last year and figure out how much I’ve made.”

The adoption of the GreenSeeker technology has been a little more problematic. He doesn’t spray-apply his fertilizer, he broadcasts it dry, and he has the sensors on his GreenSeeker set at the front of his tractor, requiring a programbased offset to compensate for the 40-foot distance between the sensor and the point at which his fertilizer is spread.

But the variability in his fields has been too great, so he’s suspended his use of the GreenSeeker unit until he can get the offset issue corrected.

De Graaf was also the first grower in his region to purchase a Geringhoff head for chopping cornstalks at harvest (now there are three or four with these heads).

And he was one of the first with a Case IH Patriot self-propelled sprayer in the

region, and he was the first in Nova Scotia to have Aim Command on the unit.

What’s also innovative about de Graaf is his willingness to take on and remediate fields that others might consider too big a drain on their time or management.

“When I first got into cropping, even before the boom from the corn price, there were a lot of fields that I would see driving around at night that looked overgrown,” says de Graaf. He would return home, figure out who owned it and then go ask the owner if he could rent it. “Over the years, I’ve probably had between five and 10 different fields — and some of them I’m still using today — where the alders were starting to grow.”

With so many potato acres in the Maritimes, de Graaf notes there were a lot of growers under contract with Hostess, with some working good parcels of land and others on not-so-good soils. But when the snack food manufacturer stopped buying locally in the region, a lot of the lesser-quality land was left behind, and that’s where he came in, renting it, remediating it and using it to grow corn and, later, adding soybeans too.

“I don’t consider myself innovative, I guess, but everyone tells me I am,” says de Graaf. “I seem to be the first to do things, and then the next year, everyone else is doing what I’m doing.” CG Corn Guide, September 2014

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Cornguide

Saying yes to no till Blake Vince (r) and Bob McIntosh are convinced no-till corn is the right way to go, even if there can be growing pain

By Ralph Pearce, CG Production Editor On the one hand, there’s hope. On the other hand, there’s reality, so although Canada’s corn growers commonly say that their goal is no till, they often get stumped by the transition. Sometimes it’s because of cornstalks.

Sometimes it’s because of equipment issues, and sometimes it’s simply because growers are hoping someone will develop a one-size-fits-all, silver-bullet type of solution to all their soil challenges.

Whatever the reason, a number of growers are standing by their no-till management strategies, insisting that with a little time, effort, research and patience, profitability and productivity can be enhanced by no till, not sacrificed.

That number includes Bob McIntosh and Blake Vince, who believe it’s never been a better time to convert to notill. Try it, they say. You’ll grow to be a believer too.

Blake Vince: “It’s the end of the year that counts”

K

eeping the water clean and his soils healthy are primary goals of Blake Vince, who farms with his father, Elwin and his uncle, Tom Vince on 1,300 acres north of Merlin, Ont. The other goal, of course, is farming profitably.

The farm is on Brookston clay, but despite his tough soils, Vince states with pride that in his lifetime, he has never used a mouldboard plow — thanks in large part to the early work of his dad and uncle.

Vince is currently working on the second and final year of his Nuffield Scholarship, and the subject of his paper is “Conserving farmland with cover crops and the importance of biodiversity.”

8

Vince’s father and uncles were early adopters, beginning work on no till in the early 1980s. At the time, John Deere’s 750 drill had yet to hit the market, so the Vince brothers started with a Tye grain drill and Great Plains coulter cart, combined with a threecoulter Ray Rawson system, all configured on a John Deere corn planter.

“Those were the days when interest rates were through the roof and commodity prices were through the floor,” says Vince. “And that was their catalyst to change, and that’s why other types of farming take place — there’s a catalyst to change. Today, for those who’ve gone away from no till, the catalyst to change Corn Guide, September 2014

has been higher commodity prices, so there’s been an influx of capital and guys have gone out and bought a tractor. And the best thing to make the tractor work is to put some kind of tillage tool behind it to see how it performs.”

That term “catalyst to change” plays a prominent role in Vince’s explanation of why no till in corn is such a tough sell. He theorizes that change is the biggest obstacle on the farm, just as nobody likes change in any facet of society. When corn prices are high, the tendency for many farmers is to plow more, with a sense of trying to capitalize on physical bushels Corn Guide, September 2014

and a strong market. The ultimate goal is tied to the belief that it’s possible to add bushels through tillage.

“And you very well may get additional bushels in the short term, because what you’ve done is you’ve burned off that accumulated soil carbon that you’ve built up in the past few years of no till,” says Vince. “The analogy is that you’ve burnt down the house to roast a hotdog, and that’s from Ray Archuleta, who works for the NRCS (National Research Conservation Service, for the USDA).”

In Vince's view, the best catalyst today is the price of fuel. In 2005, he was doing

cash flow analysis on winter wheat straw management, and at the time it was costing him more than $60 an acre to manage his winter wheat straw following harvest.

That was at a time when diesel was about 60 cents a litre. Now, with the price of diesel nearly twice that 2005 level, it’s pushed that per-acre management to a point where it’s no longer economically viable.

Vince adds that too often, farmers also get caught up in the physical appearance of their crops. They might scout soybeans in July and believe the way they look then will Continued on page 10

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Continued from page 9

equate to how they’ll yield two months later. But what really matters is how they yield in late September or early October.

“So every year in July, people look at notill soybeans in cornstalks, specifically, and they complain about how they look, at times lacklustre compared to those that have been conventionally tilled,” says Vince.

“But it’s the end of the year that counts.”

Soil is the medium That end-of-season performance is tied more to the health of the soils, which is why Vince is involved in research into a multispecies cover crop mix. Not only is he a dedicated no-till grower with a three-crop rotation, he’s also a huge advocate of healthy soils, including the reminder that in a teaspoon of such soil, there are more organisms than there are people on the planet.

There’s no scientific reason for tilling our soils the way we do, Vince says. He believes it’s simply time to stop.

Like other growers, Vince has held to the practice of frost-seeding red clover into his winter wheat for many years. And in the days when there was more mixed farming with livestock operations, people grew more cover crops to feed their animals. But as farming has embraced morespecialized management (crops versus livestock, not both), the trend has been towards scaling back on covers, and even in those cases where farmers are including a cover crop, it’s often a single-species variety, such as red clover.

“What I’m striving for is utilizing a multiple-species approach, because if we look at the outset at how these soils originated, they weren’t covered by a single species of tree or grass,” says Vince. “If you’re walking across a prairie, you have an abundant array of plants, and that’s what we’re trying to emulate.”

Since the Second World War, he adds, the tendency for agriculture has been to rely on chemical-based synthetic fertilizers instead of cover crops. The belief was that in order to push yields, chemical fertilizers were the answer. But Vince contends that when agriculture had more of the diversity of mixed farming — no 100-percent-grain production or 100-per-cent-livestock production — the soil benefited greatly. Complicating matters was the advent of herbicides and fungicides to the mix, reducing the number of beneficial organisms in the soil.

Vince also echoes many of the sentiments of Bob McIntosh when he reminds people that compared to years ago, when no till was just getting started, the tools of today make things that much easier. Heavy-duty coulters and systems with down-pressure sensors make it simpler to shift away from more-aggressive tillage tools.

“It confuses me to no end why guys continue to think that they need to till,” says Vince, who gets most of his phone calls regarding his management practices from growers more than 100 miles away.

“There is no scientific evidence that supports tillage, but to think that tillage is going to go away tomorrow, we’re just fooling ourselves.”

Healthy soils = healthy watercourses Vince is also working on the Nuffield Scholarship because of his ongoing concern with pollution in the Great Lakes (another shared sentiment with McIntosh). In spite of a newspaper report in August 2013 citing Windsor and London as the two worst

10

urban polluters in southern Ontario, Vince maintains that agriculture needs to get its nutrient house in order — fast. He believes the agri-food industry is having a major impact on the health of the Great Lakes, and Lake Erie in particular. He also sees his farming colleagues in Ohio, Indiana and Michigan, who appear to be more proactive in managing soils with an eye on cleaner water.

Regardless of the pollution from cities, the fact is he sees water flowing into Lake St. Clair from the Thames River that is the colour of chocolate milk, and much of the problem there is soil erosion following major rain events. The recent water ban in Toledo, Ohio, in late July was another indication of problems with the overall management system. In that case, media reports mentioned sewage and farm runoff as the main culprits.

“I don’t see the same urgency happening here in Ontario,” says Vince. “And that’s what motivated me to do the scholarship, to see if we can figure out a better way than what we’re doing presently.”

Soil linked to civilization Ultimately, Vince believes that North American agriculture and the health of our civilization are closely linked.

According to popular belief, North America is the standard for excellence in agriculture, as well as life in general. It’s seemingly where people from around the world want to be.

“But we take that with such nonchalance, especially how we manage our soil, and we just disregard it,” says Vince, adding that he read David Montgomery’s book Dirt: The Erosion of Civilizations, which links soil management to the viability of a society. “We look at soil as the medium which we use to support plants,” says Vince. “But the soil needs to be viewed as much more than the support mechanism; it needs to be viewed as the substance that gives the crop life.”

When farmers ignore that, he believes, they end up looking for what he refers to as “the next magical elixir” for their crop, or they look for a piece of equipment that will somehow solve all their compaction woes.

“That’s where we are today in North America — we’re on a real slippery slope,” says Vince, whose Twitter handle is #rootsnotiron. “Don’t think for a second that this all can’t come to an end.”

The future, says Vince, is all in the soil.

Continued on page 12

Corn Guide, September 2014

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Bob McIntosh: “It takes five years”

I

n the early 2000s, Bob McIntosh made a presentation at the annual meeting of the Innovative Farmers Association of Ontario. The take-home message that day was that if you’re a grower looking to enhance your soils — and ultimately your bottom line — and if you’re hoping that no till will do that for you in one or two years, be prepared for disappointment.

It takes a minimum of five years of strict no-till management before you’ll start to see significant improvement of any kind, McIntosh told his audience, before adding, 10 years is even better.

Nearly a dozen years later, McIntosh, who farms about 1,200 acres outside of St. Marys, Ont., is holding to the same line. But he’s also still insisting that no till in corn is doable, and it is viable. In fact, he just doesn’t believe there’s much to justify plowing and discing, especially across much of southern Ontario.

“There are a few things that you can and can’t do with no till,” McIntosh agrees. “Rotation’s pretty important. I don’t think it’s going to work very well with corn on corn — I’m pretty much 100 per cent corn on soybeans.”

McIntosh has had arguments in the past about how no till is defined, and Eric Kaiser, another staunch defender of no-till production, draws different comments about the “aggressive nature” of his coulter-and-planter setup.

McIntosh concedes that he’ll do some discing following wheat in late summer — to deal with the strip of chaff left behind the combine. But his definition of no till is that he’s not doing any kind of tillage the year he plants a crop.

“So we’re doing some things in the fall before, and getting ready, so that when I go to the field in the spring, I’ve probably sprayed the field, but other than that, nothing’s touched that field that year,” says McIntosh, adding that he hasn’t done any plowing on his land for years.

Big changes from then to now Since he talked to that IFAO meeting, no-till trends and technologies have changed. For instance, new corn hybrids and elite germplasm are pushing yields higher, but their tough stalks are also challenging no-tillers as never before.

Yet McIntosh notes that as plant breeding has improved productivity, 12

enhanced technologies are also helping those growers who want to avoid disturbing the soil.

“Our planter has a totally different setup than it was when we started,” McIntosh says. “We had the multiple coulters — I would think somewhat similar to what Eric (Kaiser) has, and we needed that initially because some of this ground was so hard from all the tillage and things that had been done to it, that that’s the only way we could get a reasonable seedbed at all. Now we have no coulters on the planter, just trash whippers, and not even a coulter in front of the row unit, and we don’t seem to have any trouble penetrating that and getting the seed at the depth we want. So the soil’s changed a lot.”

Then, he repeats, “But we’ve been at it for more than 10 years now.”

“We’re trying to get all of our wheat ground into some kind of cover crop, and we’re looking at options on how we can get cover crops to follow our corn and soybeans.”

As for the question of whether the hybrids are better today than in years past, McIntosh isn’t convinced that they’ve improved so much, it’s just that there’s likely a larger pool of good-quality hybrids to choose from.

The breeders and seed companies have done a better job in the past 15 years of ensuring there are fewer “duds,” he belie ves. But that also means McIntosh is planting hybrids based more on the trial results he can find and the recommendations of seed company representatives, than relying on planting a test plot on his own farm.

Another change for McIntosh is that he’s working more often with cover crops.

“We’re trying to get all of our wheat ground into some kind of a cover crop, and we’re looking at options on how we can get cover crops to follow our corn and soybeans,” says McIntosh. “But that’s a little more difficult because of the late-

fall harvest and when you can get it on.

We have little trials here with some Italian ryegrass into standing corn, to see how that works, but we’re just in the initial stages.”

McIntosh is sold on what he calls the “huge benefits” of cover crops, and wishes he’d hopped on the bandwagon years ago. By the time he figures out how to make it work, he quips, he’ll be ready to step down from farming.

By land and by water The no-till management system lends itself to other on-farm practices that can have significant benefits. There’s the impact of cover crops but McIntosh refers to another component that is gaining more and more attention: the effects of erosion.

In the summer of 2014, the ClintonSeaforth area had more issues with excessive rains, including ponded sections in fields.

So although it can take years for freeze-thaw cycles coupled with the use of cover crops to loosen plow-pans, it’s something McIntosh believes in firmly, and it’s one of the reasons he’s added berms and Hickenbottom drains to his operation.

“It’s definitely a long-term perspective, and one thing that I see is the erosion, and we’re on relatively flat ground here, but we can have pretty major erosion, too,” McIntosh says.

“That’s what convinced me years ago that we had to do something like this, because you get one major rain event, you can have all kinds of damage that will take years to correct. Every time it rains, those areas will have water in them again, because they tend to seal off. It’ll take a winter with some frost to open that up again, even if there’s tile right under it.”

On land that he rents, he’s seen where the tiles are 60 feet apart, yet it rained so much that between the tile lines the water ponded in a couple of spots and was there all year with each rain event.

With soil erosion, he adds, it only takes one event and even if it comes once every five or six years, it’s still devastating if you’re unprepared.

The addition of the berms and the Hickenbottoms have made an observable difference; when there is run-off, the water is cleaner coming off a no-till field. CG Corn Guide, September 2014

Cornguide

Watch the market’s timing B We got here with our eyes wide open. That’s how we’ll survive this year’s market downturn too

By Philip Shaw

Corn Guide, September 2014

y mid-August, new corn cash prices in Eastern Canada had hit some of their lowest levels in several years. The lesson is clear. No one should ever underestimate the production capacity of modern-day agriculture.

Although it was only a few years ago that the world was doubting whether farmers could ever produce enough corn to satisfy the burgeoning demand from biofuels and a hungry public, by adding some new technology into the mix and the sweat of farmers worldwide, we got our answer.

Huge supplies of corn now weigh on our market, and looking ahead, farmers will have to manoeuvre through this new market landscape.

The July 2014 USDA report set yield expectations at 13.935 billion bushels of corn on 91.64 million acres. This might seem like a large crop of corn, but it is also important to remember that it is coming from the smallest corn acreage since 2010.

The USDA was using a yield estimate of 165.3 bushels per acre, but this may change as we go through the fall season and the effects of late-summer weather hit the combine.

There is also the corn on hand to con-

sider as another part of the supply-anddemand equation. The old-crop ending stocks as of July 11 were pegged at 1.246 billion bushels with a stocks-to-use ratio of 9.2 per cent.

The new-crop situation in 2014 is much more telling with the expected ending stocks figure projected at 1.801 billion bushels. In other words, depending on weather as the 2014 crop goes into the bin, new-crop corn ending stocks are approaching the two-billion-bushel mark — and end-users can see that.

Traders have reacted accordingly, which explains futures prices dropping to the $3.60/bushel range by early August.

It is not like we have never been here before.

Agricultural commodities are constantly dogged by the economics of inelastic demand, which often leads to overproduction. Although the corn stocks figures are onerous as we look ahead, corn demand has been near record levels, with the USDA forecasting corn demand at 13.335 billion bushels for the 2014-15 new-crop season.

The two largest demand components of this are feed at 5.2 billion bushels and Continued on page 16

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Continued from page 13

ethanol at 5.05 billion bushels. That means demand has essentially gained back everything it lost from the $8 corn period of two years ago.

This year’s price decline has been mainly based on the huge production potential in U.S. fields in 2014, with the December 2014 corn contract in the lower 13 per cent of the market’s five-year distribution range.

For farmers in Eastern Canada who have corn in the field, all of this is a huge concern going forward. What will the corn price do next? That question is on everybody’s mind and cannot be really answered except with the proverbial “nobody knows” answer.

That applies to pessimists too. They don’t have a lock on being right. Just because the corn market is down doesn’t mean it will stay that way.

Don’t be surprised by limit move price reactions to the USDA January report

Grain prices are fluid and react to many factors and over time they go up and down. If we want insight into which way they’re likely to go, we need to ask questions like, what market factors are ahead that may affect the timing of a future major price movement? What other places in the world impact the world price for corn? What is the timing of future USDA reports and how may they impact market direction? How will the Ontario and Quebec cash markets react in 2015, and what will be the timing within that market structure?

These are only some of the questions that producers will be asking themselves going into 2015.

Timing of USDA reports is always critical.

There is much debate on how much these reports affect prices, as some traders would argue that futures spreads among months give better clues on price direction. However, USDA reports do usually serve as flashpoints in market timing.

Large price moves often come off USDA report dates and it is critical to keep that in mind as you plan your corn marketing.

Each month, USDA releases reports on myriad market factors. The October 2014 USDA report will begin to show actual yields of corn in U.S. fields. The January 2015 USDA report will show final yields reported in USDA fields.

The January USDA report often sees limit move price action. Timing marketing of corn based on these report dates can often provide rewards.

The market factors that will influence price going into the fall of 2014 have much to do with the weather for the rest of the summer and fall. The cool summer of 2014 will manifest itself in some 16

unknown way with regard to yield. USDA reports will give clues to that. Of course, there is always the prospect of frost in the fall that can affect corn yield in a negative way. The market always trades this until the frost scare passes. As we move into fall these factors will be weighing on the market.

Critical to corn marketing in Eastern Canada is understanding the nature of our corn market structure. In Ontario over the last two years, we have produced more corn than we could use, so exports out of the province have been the norm.

However, historically this has not been the case and we export out of the province during fall harvest and import back in to Ontario when our cash price approaches U.S. replacement values.

The production litmus test for this is two million Ontario corn acres with a yield of approximately 150 to 160 bushels per acre. Any production over two million acres with good yields leads to exporting corn most of the year (lower cash prices). Any production year of less than two million acres with lower yields will garner spring import pricing (higher cash prices).

Price transparency is not as good in Quebec, but with their proximity to salt water ports, export pricing can take place depending on crop size and the local demand conditions.

October and November will bring corn planting once again to Brazil and Argentina. This timing will also be critical for the corn market as acres and development will be important to move price. Brazil also plants a second crop of corn in February, which adds to the supply equation. The market will be watching this South American production and producers need to key on this as well.

With lower prices there will be less incentive to plant corn both in South America and Ukraine.

Eastern Canadian cash corn prices are always affected by the value of the Canadian dollar, but not as much as soybeans and wheat. By midAugust the Canadian dollar was fairly flat in the 91-cent U.S. range, providing a stimulus for better cash basis versus the futures prices. Timing for this is always an additional judgment to make in our marketing decisions.

There is a strong carry in the series of futures spreads between December 2014 and July 2014 corn prices. This means that the market is incredibly comfortable with the corn supply going forward. There is no premium being offered for the new corn now. Of course weather can change, the one great constant in our corn markets.

So we move ahead with hope, but hope is not a marketing plan. A black swan might fly by (totally unexpected event to affect markets), but it’s getting late in the game with the fall harvest starting up in earnest later in September.

We got here with our eyes wide open. The challenge for eastern Canadian corn producers is to stay the course. There will be corn-marketing opportunities ahead. Getting a timeline on market variables will surely help in that process. CG Corn Guide, September 2014

Cornguide

Exploding in the West The seed industry is betting the West’s corn crop will soon soar to eight million to 10 million acres

By Andrea Hilderman

I

f corn used to seem like a fairy tale crop in Western Canada, there are all sorts of Prince Charmings lining up these days in hopes of bringing her to life.

In the past decade, the West’s grain corn crop has grown fourfold, reaching a high of 405,000 in 2013. And if the pundits are right, that’s just a start.

New forecasts are for a crop 10 to 20 times that size.

“The desire of farmers to grow corn in the West is real,” says Greg Stokke, DuPont Pioneer’s business director for Western Canada and a farmer himself at Watrous, Saskatchewan. “Maturity is the linchpin that will drive adoption of corn. If growers can grow corn with less risk, they will.”

It’s true that 2014 saw a decline of 75,000 acres, but that was mainly because a cold, wet spring made timely seeding impossible in many areas.

For the record, though, Manitoba still leads the way with over 85 per cent of the regional crop, after taking a big jump in 2012 and 2013 when farmers responded to corn prices, indicating their willingness to grow corn if the returns are there.

Interest is growing in Saskatchewan, however, and also in Alberta, where corn has been grown for over a decade, although acres still hover near the 30,000 mark.

Continued on page 18

Photo : allan dawson

“Buying a corn header, even a used one, is expensive,” Mazinki cautions. ”And with corn, you have to have access to a grain dryer.”

Corn Guide, September 2014

17

Continued from page 17

Ray Mazinki farms with his brothers at Morris, Man., in the heart of the Red River Valley and the original corn-growing area of the province.

“We’ve dabbled in corn for maybe 15 years,” says Mazinki. “The last few years more so. We have a pretty diversified rotation and we have found that not only does corn have good returns, it helps us draw out our seeding and harvesting operations, which is important as the farm grows.”

Mazinki has also found that corn takes hog manure really well, not lodging as other cereals might.

“Growing corn and soybeans is like night and day when it comes to equipment,” says Maazinki.

“We also grow sunflowers and soybeans on our farm, so our planter gets plenty of use. But buying a corn header, even a used one, is expensive. And with corn you have to have access to a grain dryer — we have our own, but lots of guys might not.”

Unlike soybeans, corn has to be seeded with a planter to get the correct row spacings and, depending on the equipment, to ensure uniform depth control.

Corn has found popularity in the Red River Valley because the area has the heat to bring corn to maturity, and also because many farmers have their own grain dryers. It is not unusual for harvest to be drawn out and many crops besides corn may need drying.

”We want every grower to experience success the very first time they try corn on their farm,“ says Monsanto‘s Dan Wright “An additional advantage we see with corn is it keeps its quality better than wheat in wet years,” says Mazinki. “While corn may harbour fusarium, it rarely shows up on the kernels and corn is a cereal which is important in the rotation on our farm.”

Stokke believes more farmers are eyeing those advantages, and he believes that the extra research push going into corn for Prairie maturities will mean more growers will have hybrids that they can expect to mature.

Once corn is seeded, it is a relatively easy crop to grow, says Stokke. “Corn is a crop you can plant, and then really forget about save for a couple of weed applications and some insect scouting.”

“By harvest, the yields are huge and the returns can be very lucrative.”

DuPont Pioneer and Monsanto certainly see a future for corn in the West, and both companies are making big investments to ensure their vision comes to fruition.

18

DuPont Pioneer recently announced its intention to build a 22,500-square-foot multimilliondollar corn-breeding and -testing facility in Lethbridge, Alta. “This facility is a concrete testament to the opportunity we see for corn in Western Canada,” says Stokke. “Our commitment is long term and speaks to our belief that we can develop the sorts of hybrids that will drive corn acres here in the West.”

Monsanto Canada launched its Canada Corn Expansion Project in 2013. The project will see $100 million invested over the next decade to develop corn hybrids with earlier relative maturities that will be suitable for Western Canada.

Monsanto sees the potential for eight million to 10 million acres of corn planted on the Prairies by 2025.

“We made our first big breeding and testing push into Western Canada in 2013,” says Dan Wright, trait launch lead for Monsanto Canada. “The team was very pleased with the maturities of the hybrids and with what they learned agronomically.”

Wright says Monsanto will test hybrids extensively in local geographies all across the Prairies to be sure which hybrids will work best in which areas. “To that end, we have thousands of small and larger-scale plots at 65 sites,” says Wright. “It’s our opinion that it’s Monsanto’s job to test the hybrids for local adaptability, not the grower’s.”

It’s not just a brand position, it’s also a business strategy.

“We want every grower to experience success the very first time they try corn on their farm,” Wright says.

The driver of corn in Western Canada will be a combination of hybrids with 70-day relative maturity, give or take, and yields of 100 to 110 bushels per acre. Once such hybrids hit the market with testing for local adaptation and agronomic suitability — assuming grain markets are attractive — the Monsanto view is farmers will grow corn.

With the right genetics, corn may also have a useful fit in the rotations in Western Canada.

Corn can provide additional diversity in the rotation allowing for more integrated weed and pest management strategies.

Maturity isn’t the only barrier to successfully growing corn though. There are some special equipment requirements needed for corn. Unlike soybeans, farmers can’t get their feet wet with corn using their existing machinery.

“To grow corn, farmers need planters, corn headers for the combine and probably some access to drying capacity,” says Stokke. “That said, some farmers who are growing soybeans are starting to up their game with that crop by purchasing planters. We will see corn follow soybeans to a large extent… they are a good fit together in the rotation.” CG Corn Guide, September 2014

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Cornguide

A market for your cobs Research is showing we can start harvesting some of our stover for cellulosic ethanol… if we do it right

By Ralph Pearce, CG Production Editor

T

he allure of harvesting corncobs and stover for sale is getting harder to resist, and with the downturn in the grain market, the possibility may seem more tantalizing than ever. Even so, while the speculation grows about where and when a cellulosic plant will get built, the question is still hanging in the air: Can you have your cake and eat it too? Or, to put it in a more agricultural context, can you sell your corn residue and still keep your soil healthy enough to grow a great grain crop?

“The bottom line on this comes back to how well the soils have been managed.”

— Adam Hayes, OMAFRA 20

That question is getting more complicated, with two separate schools of thought.

One school says that the research has been done.

Stover harvesting is viable and sustainable, and it’s time for the innovators and entrepreneurs to jump in, building the long-term collection and storage infrastructure that the cellulosic ethanol industry would need in order to begin production of the new biofuel. For many in the industry, this idea is a matter of “when” it can be done, not “if.”

But the other school says the jury is still out.

Even with well-researched standards for residue removal, this school says, there’s a concern that growers might get carried away — almost literally — and that our grain yields and the health of our farms will suffer as a result.

In truth, firmer guidelines for the removal of corn stover (and other residues) have been the focus of considerable research in recent years. In November 2010, reports on two separate studies were released, one by a group of University of Guelph researchers and another by a team from Western University at London, Ont. Both teams looked into using corn residues for energy or heat generation, although both also made several observations that applied to biofuels. A third study, released in August 2012, was prepared for the Ontario Federation of Agriculture based on the Western University research, and it addressed biomass crop residues and their availability for bioprocessing, specifically in Ontario.

The University of Guelph study with Drs. Hilda Kludze and Bill Deen as lead authors looked partly at short-term economics, beginning with the idea that the net price for the crop residue would need to be higher than the value of nutrients that would be removed, hard as that might be to calculate.

Then the Guelph study also tackled the question of sustainability. Soil organic matter, the study found, is critical for soil health, contributing to the soil’s resistance to soil erosion and crusting, its ability to form aggregates, and its cation exchange capacity (CEC).

The conclusion comes out in favour of cob harvesting, which the study called an “environmentally Corn Guide, September 2014

sustainable and economic alternative feedstock” for the bioenergy industry.

The Guelph study said there are three key reasons for promoting their use in Ontario: 1. cobs are abundant, and can be gathered in all counties in which corn is grown; 2. the level of nutrients in cobs is insignificant, and 3. cobs make up only 16 per cent of stover. A fourth reason cited the low sulphur and ash content in corncobs, making it an ideal feedstock for generating heat and electricity. Its use in biofuel processing was not mentioned.

Soil organic matter In the 2010 Western University study and the subsequent OFA-Western report of 2012, both of which saw Dr. Aung Oo as a primary contributor, the importance of soil organic matter was also highlighted. At the same time, both projects attempted to quantify the removal of small amounts of residues, recognizing the added value for growers, but also the minimal impact on soil health and its properties. The initial UWO study mentioned soil erosion due to water run-off as a factor to consider when removing residues.

The OFA-Western University report made extensive recommendations for removing crop residues, including specific observations about corn residues and the creation of bioprocessing industries using crop residues in Ontario.

Corn Guide, September 2014

In its general summary, the study found that the total quantity of sustainably harvestable crop residues in Ontario to be 3.12 million tonnes per year.

That constitutes roughly 20 per cent of the province’s total crop residues produced in a year. The recommendations also said that the quantity of sustainably harvestable residues would be farm specific, and it would depend on a blend of factors including crop rotation, application of organic materials such as manure, cover crop management, topography and tillage practices.

It should be noted that a similar study conducted in the U.S. by biofuels manufacturer Poet came up with a similar 20 per cent base removal rate for corn stover. Its 2013 report was a response to a project by Purdue University which warned against stover removal, citing environmental concerns such as erosion and greenhouse gas emissions. The Poet study stated its findings were in the 20 to 25 per cent removal rates, not the 38 to 52 per cent levels in the Purdue study.

According to research in 2010, soybean residues are not an option for removal.

Stage is set In summary, the research is showing that as long as it’s done with an eye to sustainability, cob harvesting makes sense.

“We’ve been working on cellulosic ethanol since 2007,” says Mark Schwartz, business development manContinued on page 22

21

Corncobs have been identified as the better source of carbon and the smallest component of stover, meaning fewer nutrients to replace.

22

Continued from page 21

ager for GreenField Specialty Alcohols, based in Brampton, Ont. “We actually worked with corn stover a couple of years later, and I know we’ve done some corn stover studies. But we started with wood, and then we started adding things from there. After that, we got into corncobs, which have the highest level of carbon.”

Schwartz has worked with an Illinois farmer who’s been gathering cobs and stover for nearly a decade. His combine has been modified to haul a cart behind the combine almost at ground level. The combine travels at a lower speed, and the cart collects cobs and stover. In fact, this farmer stopped harvesting one day when the auger for the biomass broke. He reasoned that it wasn’t worth the effort of combining the corn on its own, and then going back and gathering the stover in a separate harvest.

When the price of corn took its substantial jump in 2009, farmers, agronomists, plant breeders and retailers all looked for ways to drive corn production up to and beyond the 300-bu.-ac. level. Continuous corn practices, higher plant populations and improved stalk strength played significant roles in that drive. But it also meant higher residue levels, and in many cases, a return to plowing and more aggressive forms of tillage as a means of managing the mat of corn stover that was left behind.

“People don’t realize that the biomass adds carbon

to the field,” says Schwartz. “When you’re spraying nitrogen to get that crop to grow, you have too much carbon and you have to add more nitrogen. So a lot of these growers are getting huge crops, they’re getting huge amounts of biomass and carbon, and a lot of them see the benefit of pulling off some of that carbon.

Most of the growers who do the biomass (collection) are no-till guys. They want to get rid of it.”

It’s Schwartz’s opinion that if there’s more research to be done, the focus could be on how much biomass should be taken off. He points to individuals like the Illinois farmer he has worked with in the past as pioneers, based on how they’re making money collecting cob biomass for mushroom growers, among others.

In the meantime, GreenField is in the process of getting its cellulosic ethanol plant (or plants) operational. It will also take about two years to gather sufficient amounts biomass in advance of the start of processing.

“One of the biggest challenges is going to be storage and distribution,” says Schwartz, adding that in his opinion, there’s enough research to show residue collection can be done, sustainably and effectively.

“You can’t move the biomass that far away and you have to store it carefully so it doesn’t rot. But once we build the plants, we know there’ll be a lot of material.”

Continued on page 24

Corn Guide, September 2014

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An efficient method of collecting stover from the back of the combine needs to be found to ease the process of generating sufficient feedstocks for cellulosic ethanol.

24

Continued from page 22

Pushing the limit There may be a lot of material, and a lot of interest among farmers, but the concern from a provincial extension perspective is still the extent to which farmers will push the limits on residue removal.

“There certainly is a concern that if we do come out with a way of calculating a number of what to remove, whether people will stick with that or push it to 50 per cent or 100 per cent more,” says Adam Hayes, soil management specialist for field crops with the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA).

Here’s the point where it could get out of balance, Hayes says. He points to the fact that the Guelph research shows that the more corn you have in a rotation, the more opportunity you have to remove residue. “But the challenge with that is what is happening at the long-term rotation plots at Ridgetown and Elora, where the poorer rotations at those sites from a yield and soil health perspective are the ones that have more years of corn in them. If it’s continuous corn or the corn-soybean rotation, they are the poorer yields.”

One strategy that might help is cover crops. Hayes has been working for several years on multi-species cover crops in a number of cropping scenarios, and believes that the practice of removing residue would be helped by growers adding a cover crop. Dr.

Shannon Osborne of the USDA’s Agricultural Research Service (USDA-ARS), has been studying the removal of residues in concert with cover crops where possible to offset the loss of organic matter.

She spoke at a local Ontario Soil and Crop Improvement Association (OSCIA) chapter’s meeting, last December.

“Depending on the rate of removal and the cover crop program,” Hayes says, “they were able to use cover crops to allow the removal but to offset any negative impact on the soil.”

Hayes has seen a recent increase in interest in cover crops among growers, not just following cereals but for inter-seeding of cover crops into standing corn. He’s been working on inter-seeding cover crops at the sixleaf stage, and he’s been receiving calls from growers who are trying to seed into maturing soybean stands.

“To me, the bottom line on this (residue removal) comes back to how well the soils have been managed,” says Hayes. “There are soils where people have been doing a good job of maintaining their soil organic matter levels or even pushing them up. But there are a lot of soils where organic matter levels are dropping or continue to drop, so those are soils of concern. The soils that are declining or have low levels of organic matter are the soils where we’re seeing the loss of aggregate stability, more potential for soil erosion, poor soil structure and crusting — we don’t want to be taking organic matter away from those soils.” CG Corn Guide, September 2014

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Cornguide

Conservation

versus vertical tillage Which is best, year in and year out?

By Ralph Pearce, CG Production Editor

26

L

ate in 2013, in the middle of a conversation on a completely different topic, the subject of conservation tillage came up, and Pat Lynch paused and then said, “If you ever want to talk about conservation tillage, just let me know.”

A lot of farmers believe conservation tillage is just another way of saying vertical tillage, Lynch says. But he believes the two are actually different.

Lynch’s concern may be justified. It turns out the two are quite different, with different uses, as well as differing considerations to maximize their respective strengths and weaknesses.

To be fair, of course, it isn’t only Lynch who believes that conservation tillage differs from vertical till. Growers Doug Park and Bruce Smith hold the same impressions about the practices, albeit with a few key differences. Park is located just outside of Sarnia while Smith farms land near Caledonia, Ont. Both work on heavier soils, and both agree with Lynch’s distinction between the two systems.

“Conservation tillage would be something that we’d always do in the fall, like with a chisel plow or a disc ripper,” says Park. “Vertical till is a tool that we normally use in the spring, and it’s similar to a set of discs, but it doesn’t move as much dirt, just loosens the top couple of inches.”

Interestingly, it’s been the change in corn-growing practices that led Park to alter his no-till practice. In the past 10 to 12 years he’s found, like many other farmers, that plant breeding in corn has strengthened the stalks. Added to that are the higher yield potential and increasing plant densities.

“I don’t think we need to go back to doing near the tillage we used to do, but we need to be somewhere in between,” says Park, noting that today’s cornstalks are very different from those of 10 or more years ago. “These stalks stay green and healthy, and we’re putting fungicides on them in the summer so they’re still green come harvest-time. So they’re just not breaking down like they used to.”

Last year, Park actually switched his definitions. In the best field he has, he used his vertical tillage tool last fall. In fact, because it was a good crop and there was plenty of residue, he vertical tilled the field twice — once on an angle, and then lengthwise, and then planted soybeans right into that field come the spring. Into midsummer in 2014, those were his bestlooking soybeans compared to the no-till crop he planted, which he says was very yellow in mid-July.

A different approach Park also makes no apology for employing conservation or vertical tillage; with the number of acres he manages, the window for planting is simply too small. “There are only about three good days of no till on our ground,” says Park. “You can’t do it when it’s too wet, and there are only about three good days before it’s too dry. Certainly on loamy soils, your options are so much better.

We could make no till work if we were on 400 acres and got everything into that three-day window.”

For Bruce Smith, the use of conservation tillage on his land is routine. He farms on some heavier clay soils but also works on what he refers to as “potato ground.” To Smith, conservation tillage comes down to doing a minimal amount of tillage and leaving up to 30 to 70 per cent residue cover depending on how it’s broken up and what that particular field is going to be used to grow.

Smith is reluctant to say which one should be used in fall or spring, since he employs both systems on his land, and adjusts their use according to specific conditions.

Not size but soil types “If you’re going to go in with corn, you want to have that area clean for the corn planter,” says Smith, noting that some no-till equipment will do the job under ideal conditions. “One of the biggest things we’re finding is working ground in the spring, and especially when you get a later spring and drier conditions, you don’t want to lose Corn Guide, September 2014

“I don’t think we need to go back to doing the tillage we used to do, but we need to be somewhere in between.”

— Doug Park, Sarnia-area farmer your moisture. And that’s where you get into the higher residues. With the light tillage, and then not working deep, you can drop the seed into moisture.”

Vertical till falls along the same line, adds Smith, mainly because it can do a great job in the proper soil conditions, shattering crop residues, particularly cornstalks.

Smith works with both a Case IH 870 as his conservation tillage unit for fall practices and a Case IH 330 Turbo Till unit for vertical tillage, typically used in the spring.

The 870’s large disc blades and parabolic shanks help lift and disturb the soil and incorporate corn residues in the fall.

“The disc basically does the job of incorporating the material,” says Smith.

“And then one of the key components is having that field very level. You want it rough, but you want it level.”

The vertical tillage unit, he points out, has larger tires and walking tandems and wing-gauge wheels, so he’s not digging deep into the denser soil zones.

Pat Lynch keeps his definition of conservation tillage to one short sentence: tillage that maintains 30 per cent surface residue up until the time of planting the Corn Guide, September 2014

next crop. He says that one proviso is important because a grower might have 30 per cent residue after tillage on winter wheat stubble, but by the next spring there may not be that same amount of residue in place.

“In some cases, you need more than 30 per cent, so conservation tillage keeps 30 per cent residue cover during those critical erosion times of early spring, up until mid-May,” says Lynch, an independent agronomist. “We really want to conserve the soil and prevent erosion.”

Know your limitations To Lynch, that’s the important message — to conserve soil, prevent erosion and deal with the residues left behind by intensive cropping practices. Some farmers get caught up in the definitions of vertical versus conservation tillage, but to Lynch, the latter is a means of dealing primarily with the strengthened stalks in the corn sector. He says vertical tillage, on the other hand, is really a type of conservation tillage.

Lynch says that most farmers could adapt their farm practices to conservation tillage, but there are some factors that

could be challenging. For one, conservation tillage costs more, particularly from the perspective of the added unit cost and the horsepower requirement. But Lynch notes it’s possible to mitigate that hurdle by renting what you need.

Soil type and weed management also play a part in the consideration for conservation tillage. Managing residues on sandier soils typically doesn’t require deep tillage. At the other end of the soil spectrum, the heavier clay soils can be damaged by an implement pulled through in a late and wet fall. That’s why silt-loams are a natural fit.

As for weed management, Lynch believes he’s seen more volunteer corn in fields that used conservation tillage on cornstalks in 2013.

“We have seen that many times before, where if you use conservation tillage, you will have more volunteer corn,” Lynch says. “Second, you tend to have more annual weeds than if you use no till or mouldboard plowing. Perennial weed pressure will be less with conservation tillage because some of the species — like dandelion — you’re destroying. Some of the others, like perennial sow thistle, you’re breaking up those roots, causing more of the dormant buds to grow, which can make control easier. If you have a large undisturbed root mass, many of the buds can lay dormant until the first growth is sprayed off in the spring.” CG 27

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