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‘Serving The Nation’s Sugarbeet Community Since 1963’ Volume 50 Number 3 March 2011
Page 16 Sugar Publications 4601 16th Ave. N. Fargo, ND 58102 Phone: (701) 476-2111 Fax: (701) 476-2182 E-Mail: sugar@forumprinting.com Web Site: www.sugarpub.com Publisher: Sugar Publications General Manager & Editor: Don Lilleboe Advertising Manager: Heidi Wieland (701) 476-2003 Graphics: Forum Communications Printing
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— Feature Articles — ASGA Annual Mtg. Highlights . . . . . . . . . . . . . . . . . . 4 Photos and commentary from Tucson event
‘Exciting Possibilities’ . . . . . . . . . . . . . . . . . . . . . . . 7 ASGA president discusses biotech, sugar policy and other priorities
Cal Jones Retiring After Four+ Decades in Sugar . . 8 President/CEO at Wyoming Sugar since 2002
Transition Rapid & Successful . . . . . . . . . . . . . . . . 16 Michigan grower Chris Guza moves to strip till and 22” rows
Sugar in Chile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
The Sugarbeet Grower is published six times annually (January, February, March, South American nation among lowest-cost beet sugar producers April/May, July/August, November/December) by Sugar Publications, a division of Forum Communications Printing. North American sugarbeet producers receive the magazine on a complimentary basis. — Front Cover — Annual subscription rates are $12.00 domes— Regular Pages — tic and $18.00 for foreign subscribers. Mike Richmond applies Advertising in The Sugarbeet Grower Dateline: Washington . . . . . . . . . . 12 fungicide for Cercospora does not necessarily imply endorsement of a Latest on Roundup Ready, price election leafspot control to a 2010 particular product or service by the publisher.
Write Field . . . . . . . . . . . . . . . . . . . 14 Change of Heart . . .
Visit Our Website! Now Updated & Expanded!
30 Years Ago . . . . . . . . . . . . . . . . . 15
www.sugarpub.com
Around the Industry . . . . . . . . . . . 23
THE SUGARBEET GROWER March 2011
sugarbeet field near Bay Port, Mich. Photo: Don Lilleboe
Excerpts from our March 1981 issue Who, what & where it’s happening
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— Hot Topics in Tucson —
T
hough abnormally cold temperatures in southern Arizona preceeded the 2011 annual meeting of the American Sugarbeet Growers Association, both the thermometer and the ambience indoors were considerably warmer by the time the event got underway on February 6. Approximately 340 growers, spouses and affiliated industry gathered in Tucson for this year’s meeting, with representatives from all U.S. (and Canadian) beet growing regions. Pictured on these pages are several of the speakers who addressed the 2011 meeting audience. Also speaking via prerecorded messages were Rep. Frank Lucas (R-OK), the new chair of the House Agriculture Committee; Rep. Collin Peterson (D-MN), former House Ag chair and current ranking member; and Sen. Debbie Stabenow (D-MI), the new chair of the Senate Agriculture Committee.
Above: ASGA President Russ Mauch (left) is pictured with Kelly Clay of Worland, Wyo., who received a special “Friend of the Sugarbeet Industry” award from ASGA during this year’s annual meeting. Clay is president/CEO of Admiral Beverage, which bottles and distributes a broad portfolio of soft drinks and other beverages across several western states. Admiral Beverage is the fifth largest bottler of Pepsi in North America. Having grown up in Worland and being very familiar with the beet sugar industry, Clay professed to being chagrined at not being able to use sugar in products bottled by his company after the soft drink industry’s transition to high fructose corn syrup in the 1980s. A few years ago, however, PepsiCo decided to come out with an LTO (limited time offering) of a sugar-sweetened product, “Pepsi Throwback.” Clay said his company lobbied to keep sugar in this product long term because it is “critically important in our marketplace.” They were one of just two bottlers allowed by PepsiCo to do so, and sales spiraled upward, as have those of “Mountain Dew Throwback” and additional sugar-containing products. Clay expects Pepsi Throwback and other sugar-sweetened products to become permanent lines — which is good news for his company and for the beet sugar industry. “We’re really proud to be in the industry we’re in,” he told ASGA members. “And we’re really, really proud to use your product — sugar.”
Photo: ASGA
Below: The 2011 ASGA audience hoists a toast — with cans of sugar-sweetened “Pepsi Throwback” — to Kelly Clay (front, center) and Admiral Beverage, the Worland, Wyo.-based company that has championed the use of sugar in its products. Shown with Clay are his good friend John Snyder (left), president of the Washakie Beet Growers Cooperative, and Russ Mauch, ASGA president.
Photo: Don Lilleboe
ASGA Annual Mtg. Highlights
4
THE SUGARBEET GROWER March 2011
Photos: Don Lilleboe
Above: Dan Colacicco, director of the Dairy and Sweetener Analysis Group at USDA’s Farm Service Agency, provided the ASGA audience with a review of the U.S. sugar program and how it has been operating since passage of the 2008 farm bill. Colacicco’s group is responsible for administering the domestic portion of the program. Colacicco noted that the domestic sugar market today is not where Congress or USDA expected it would go when developing the 2008 farm bill. “Our 2009 budget projection, done in late 2007, forecast significant and persistent sugar surpluses and federal expense due to the sugar program,” he said. With the full implementation of NAFTA as of January 2008, “we expected the lower-priced sweetener, HFCS, to flow into Mexico, and the higher-priced sweetener, sugar, to flow north, creating a U.S. surplus.” Since then, of course, the market outlook has tightened significantly, to where “we forecast no sugar surpluses and no federal expense for the sugar program,” Colacicco observed. “The issue we now face is adequacy of supply.”
Right: Randy Green, president of the Sweetener Users Association, brought a different perspective to the discussion of the U.S. sugar program. SUA members — companies producing everything from bakery/cereal products and confectioneries to ice cream and beverages — account for 57% of U.S. sugar deliveries. While affirming that there are important areas where users and producers of sugar work together (e.g., GMO beets), disagreement between the two segments can be strong when it comes to the need for and nature of U.S. sugar policy. SUA members want “adequate supplies at reasonable prices,” Green stated, adding that “we haven’t had that in recent years.” The SUA leader said his group has been harmed by the basic structure of U.S. sugar policy, by changes made in the development of the 2008 farm bill, and by the program’s administration at
USDA. “Your customers certainly think there’s a cost to sugar policy,” he stated, citing a perceived need for “serious fundamental reform.”
Above: ASGA’s leadership team for 2011 includes, left to right: Luther Markwart, executive vice president; Kelly Erickson (Hallock, Minn.), vice president; Russ Mauch (Barney, N.D.), president; and Don Steinbeisser, Jr. (Sidney, Mont.), treasurer. Left: Larry Combest, a former House Ag Committee chairman who now works on behalf of the American Sugar Alliance, reviewed the 2008 farm bill record and looked toward 2012. “I will put the farm program record up against any other government spending,” he stated. “Stay involved, stay united, keep marching forward,” he advised ASGA members. Right: Mary Coffey Alonzo is director of the USDA Risk Management Agency’s Actuarial and Product Design Division. She overviewed RMA’s extensive internal product development process, and also outlined the various challenges involved in developing revenue coverage for sugarbeets, from RMA’s perspective.
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THE SUGARBEET GROWER March 2011
‘Exciting Possibilities’ ASGA President on Biotech Beets, Sugar Policy & Other Priorities The current president of the American Sugarbeet Growers Association, Barney, N.D., producer Russ Mauch, touched upon several key areas of ASGA priority and activity during his commentary toward the conclusion of the group’s 2011 annual meeting in Tucson, Ariz. A significant portion of his remarks dealt with biotech issues — specifically, the long and ongoing litigation regarding the availability of Roundup Ready® sugarbeets for 2011 and beyond. Below are excerpts from Mauch’s presentation. 2010 was a great year for our growers. We harvested a super crop that was paired with a strong market. We all know the challenges that Mother Nature can throw at us, and we do our best to overcome those challenges and employ risk management tools to soften the blow of nature’s wrath. The unique challenges in biotechnology that we faced last year and this spring, however, lie squarely in both the speed and judgment of the courts. This past year, I received constant briefings from our Russ Mauch staff and legal counsel as we dealt with the court’s decisions. Vacatures, stays, appellate courts, TROs, injunctions, APHIS, regulated and deregulated are all words and terminology that a simple farmer just wanting to raise a family of girls needed to learn to keep up with the Roundup Ready issue. I have yet to see a “brief” that actually is! The efforts of our staff and legal team on this front have been extraordinary. It has been — and will continue to be — our highest priority because of the importance and value it brings to our growers. Even more important, these legal challenges are, frankly, not about sugarbeets; they are a threat to the future of the entire agricultural biotechnology industry. What happens with our crop has global implications for all biotech crops. Simply put, biotechnology is a gift to farmers. It is also a very important re-
THE SUGARBEET GROWER March 2011
sponsibility to use and manage this technology wisely. The beet sugar industry has respectfully addressed issues to make sure we can co-exist with our fellow farmers, particularly in the seed production region. If you could pick the commodity that is best suited for biotech, it would be sugarbeets. We don’t produce seed in our commercial production; our root perishes over the winter (no volunteers); we rotate crops; and the sugar is the same. The seed industry has strict protocols that avoid cross-pollination, and that issue will soon be completely eliminated. So I remain confident that we will have this technology long-term and improve upon it in the years ahead. The possibilities are exciting. I appreciate people who protect the environment, because every farmer in this room is a steward of the land. I also appreciate farmers who choose to grow organic, conventional [or] biotech crops. We can all co-exist without complicated and costly government intervention, make our livings and provide products to our respective customers. I appreciate those consumers who want to produce and eat all-natural, organic, free-range animals, or not eat animals at all. We live in a country where people are blessed with sufficient income to allow them to make such choices and pay the significant price premiums to have that choice. This is a luxury most of the world does not enjoy. If you think that is a viable, sufficient alternative to the production of our food, however, then it’s important to know that three out of every four people who live and work off the farm would need to quit their jobs and return to rural America to grow food in that manner to support themselves, their families and their communities. You simply can’t feed and clothe the world from garden-sized, free-range farms. We have an expanding global population and limited land and water resources to feed a hungry world. We cannot meet the needs of starving people without the use of biotechnology.
On the sugar policy front, we have a good policy and it has been administered well. We are just beginning the 2012 farm bill journey. It is a huge challenge that we are already focused on. Somehow, I feel that the wisdom of “If it ain’t broke, don’t fix it” won’t be the slogan of choice for Congress. We will have to be very vigilant on any new amendments or legislation that pop up. It is so early, with so many new members in Congress, that it is impossible to know what we are going to have to defend against in order to keep a perfectly good “no cost to the government” sugar program intact. Our user customers are not fond of the policy, and attacks against it are already underway. During a period of political frustration, some members of Congress may vote against things simply for the political optics of how it looks back home. So we must work hard to educate new members of Congress so they have a reason to stand with us. The future looks bright as the food and beverage industry continues to recognize the benefits of using real, allnatural sugar. Sugar demand is up through new products that are coming out in teas, coffees, juices and sodas. We continually work to bring better risk management tools to our producers. Farmers handle a lot of money. There’s an old saying that farmers often use: “I’ve got great cash flow; I’d just like to reach in and get some sometime.” So we meet with the top people at USDA’s Risk Management Agency to keep pressing for improvements in what we have and to look for new opportunities to reduce our economic risk. We have much to do this year, and we have a great leadership team and board of directors to forge ahead. We have experienced talent at all levels to address these and other issues that may arise in the coming months. ❖
I remain confident we will have this technology longterm and improve upon it in the years ahead. 7
Photo: Don Hall
Cal Jones Retiring After Four+ Decades in Sugar
A
42-year career in the sugarbeet industry is drawing to a close for Cal Jones; and it’s ending, to his great satisfaction, not far from where it started. Jones is retiring April 1 as president and CEO of Worland-based Wyoming Sugar Company, LLC. As the crow flies, Worland is just 65 miles from Powell, where he grew up. His career has taken him to Montana, Texas, Colorado, back to Texas — and then, in 2002, home to Wyoming. During that time, he has successively served as a sugar company agriculturist, agricultural manager, byproduct sales director, vice president of agriculture, vice president-commodities and company president/CEO. But Jones’ earliest sugarbeet memories come from fields east of Powell. His uncle, Earl Jones (father of Terry Jones, a former American Sugarbeet Growers Association president), grew beets, and Cal worked for him. “Terry and I have
8
many memories of working side-by-side at various farming activities,” he says. “My most vivid memories are of when we decided we could make some ‘easy money’ thinning beets (with shorthandle hoes) like the ‘nationals’ (migrants), who made it look easy. We were definitely wrong — but had to complete the task we had agreed to perform!” Setting irrigation tubes is another seared memory from that north central Wyoming youth during the ’50s and ’60s. As any veteran irrigator understands, “we not only had to move the tubes to the head ditch, but had to pick them up and move them farther down the ditch for the next set. That farm enterprise needed more irrigation tubes!” Following high school, Cal received an agricultural scholarship to Northwest Community College in Powell, where he earned an associate degree in general agriculture. He continued his
education at the University of Wyoming, earning a B.S. degree in crop science. His first job in the beet industry was as a fieldman with Holly Sugar at Hardin, Mont. With his wife, Donna, and one-year-old son, Darren, he moved to Hardin in a week when the thermometer plunged to -32 degrees — “and we moved into a cold, cold rental house.” That was in 1969. Two years later, he moved to Holly’s Sidney, Mont., district. Jones was promoted to senior agriculturist in 1974 and transferred to Holly’s factory district at Hereford, Texas. He was subsequently promoted to assistant ag manager and later agricultural manager at Hereford. While there, he also was responsible for marketing of byproducts produced from the Texas Panhandle beet crop — including the expansion of the local animal feed market into New Mexico dairy areas. Other responsibilities during the Hereford years included expansion of the beet production area and factory receiving capacity, along with changing the philosophy and method of reloading stock-piled beets (i.e., using trucks instead of rail). Jones remained at Hereford for 11 years, finding them among the most enjoyable of his long career. “We were there long enough to raise our family and provide a good Christian background for our two sons,” he reflects. It was also in Hereford where Cal became very well acquainted with the late Bill Cleavinger, former ASGA president and longtime president of the Texas-New Mexico growers association. “Bill always had a positive attitude and Christian approach to handling situations in a no-nonsense manner — as well as the technique for successful lobbying for what you believe in,” Jones observes. In 1986 Jones accepted a transfer to Holly Sugar’s corporate office at Colorado Spring, Colo., as assistant director of byproduct sales for the company’s eight beet sugar factories. He was promoted to director later that year. The following year, 1987, Holly promoted Jones to vice president of agriculture. His portfolio encompassed all agriculture functions, beet seed division operations, agricultural research programs and editing Sugarbeet Update, Holly’s grower-focused magazine. He also served as president of Holly Sugar Export Corporation, with responsibility for international marketing of byproducts (mainly in Japan, Europe, Mexico and Canada). Holly Sugar merged with Sugar Land, Texas-based Imperial Sugar Company in 1988, and Jones assumed responsibility for marketing byproducts
THE SUGARBEET GROWER March 2011
from Imperial’s cane sugar refineries in addition to those from beet sugar factories. The cane refineries operated added-value liquid feed businesses, and those products were marketed in new areas around the continental United States. The merger also brought four more beet sugar factories under the corporate umbrella (those of Michigan Sugar Company) and one more cane refinery (with the purchase of The standard quip in Savannah Foods). The Wyoming farm boy the WSC boardroom has was promoted to vice pres- been that sugar sales are ident-commodities for Imhandled by Cargill and perial Sugar in 1989 — a byproduct sales by ‘Calgil.’ post he held for the next 13 years. His duties expanded to include the negotiation and purchase of raw cane sugar for the three Imperial refineries (Sugar Land, Texas, Savannah, Ga., and Gramercy, La.). He also was responsible for the negotiation and purchase of energy needs for all the company’s facilities — including the Michigan beet factories.
I
mperial Sugar Company filed for Chapter 11 bankruptcy protection in early 2001 after struggling with lower refined sugar sales and higher energy costs. The company emerged from Chapter 11 later that year, as it simultaneously downsized its operations. It either closed or sold the former Holly Sugar beet factories and also ended up selling the four Michigan Sugar factories to that state’s growers. Cal Jones found a new home in 2002. In that year he accepted the post of president and CEO for Wyoming Sugar Company, LLC (now a wholly owned subsidiary of Wyoming Sugar Growers, LLC). Wyoming Sugar consisted of beet growers and other investors from the state of Wyoming who pur-
chased the former Holly Sugar factory at Worland in order to keep sugarbeets in the Big Horn Basin and Fremont County areas. Longtime Worland grower Dick McKamey has served as chairman of Wyoming Sugar since its inception. Jones had been aware of the establishment of Wyoming Sugar and the company’s search for a CEO. After discussion with his wife and family about another move [their two sons and their families reside in the Texas Panhandle (Darren) and northern Colorado (Jason), respectively], “we decided to interview, with the mindset of ‘what will be will be.’ ” He was offered the job, they moved — and now nine years have passed. “We are very thankful and have no regrets of moving to Wyoming Sugar,” says the veteran sugar man. Wyoming Sugar has transitioned from being a broadly held entity (with non-grower investors) to now being a company wholly owned by sugarbeet producers. For Jones, that ranks among the most satisfying aspects of his tenure with the company. “It has created a sense of stability within our acreage base with committed growers,” he emphasizes. With its daily beet slicing capacity of 3,600 tons, the Worland factory is the second smallest in the country (next to Western Sugar’s Lovell, Wyo., plant). And with just the single plant, Wyoming Sugar Growers is the nation’s smallest beet sugar processor. Its refined sugar is marketed by Cargill, Inc., while Wyoming Sugar sells the pulp and molasses byproducts on its own. (Given his background, Jones was the logical person to handle byproduct sales. The standard quip in the boardroom since then has been that sugar sales are handled by Cargill and byproduct sales by “Calgil.”) “The company — the board of managers and management — has developed a business plan for our size,” Jones states. “We continue to operate following that business plan, with committed growers and finished products to fill our market niche.”
A
look back across four-plus decades in the sugar industry conjures up lots of good memories — and many changes — for Cal Jones. “I’ve seen the agronomics change from the short-handle hoe and migrant field labor, to plant-to-stand,” he notes. “I’ve also witnessed the advent of improved seed quality, disease packages and increased yield potential.” Growers for Wyoming Sugar also produced the first commercial Roundup Ready® beets in the nation, in 2007. “I have enjoyed my tenure, and hope my contributions have had meaning and encouragement for those I’ve had contact with — whether employees, growers or those in the communities where we’ve lived,” Jones remarks. Dick McKamey says that in retrospect, Wyoming Sugar’s directors couldn’t have found a better team leader than Cal Jones upon their purchase of the former Holly factory back in 2002. “He was really what we needed for a very nervous industry at that time,” McKamey recalls. “We were buying this factory out of bankruptcy. We had some pretty nervous employees, and it took someone with Cal’s extreme personalism and rapport with employees to really bring it forward. “Cal took a group of talented employees and developed them into an experienced and cohesive operating management group, and this management team will lead Wyoming Sugar going forward. “He really deserves the best of accolades.” Cal and Donna Jones plan to do some traveling in retirement, visiting their children and grandchildren — and even taking fall trips, which was a very rare event during all those years of overseeing sugarbeet harvests. He intends to do some consulting as well, given his breadth of background in the sugar industry, and — just as importantly — plans to do “more fishing in Wyoming.” — Don Lilleboe ❖
10
THE SUGARBEET GROWER March 2011
Changing Conditions Demand Active Depth Control
Wands mounted on the harvester send readings to the hydraulic system attached to the rear struts.
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Dateline: Washington Price Election Modification On February 28, USDA’s Risk Management Agency (RMA) announced a $5.50 increase in the price election from its initial December announcement of $41.50 ($43.75 in California), to $47.00 per ton for all growing areas. Beet growers deeply appreciate RMA’s review and consideration of more-recent marketing data from our cooperatives that clearly justified an increase. A very special thanks to John Doxie, president of United Sugars Corporation, for joining ASGA President Mauch and Vice President Erickson to personally meet with RMA Administrator William Murphy and his associate administrator, Barbara Leach, along with key members of the Kansas City RMA staff, to the update them on the unique dynamics in the current sugar market.
Roundup Ready Litigation We are in a rapidly changing legal and business environment, so what I am outlining for you in this article is the state of play as of March 1. On February 4, 2011, USDAAPHIS issued a massive 369-page Environmental Assessment (EA) and a Determination Decision that authorized planting of Roundup Ready sugarbeets (RRSB). APHIS’ decision included mandatory interim measures for planting RRSB crops, including the spring 2011 crop, while APHIS prepares a final Environmental Impact Statement (EIS) on RRSB, which is expected to be completed by May of 2012. USDA is now allowing Roundup Ready sugarbeets to be planted, with a number of conditions for the root crop. The RRSB seed crop to be planted in 2011 (to produce seed for the 2012 root crop) in the Willamette Valley in Oregon can be planted under APHIS restrictive permits implementing 18 mandatory conditions. But wait. While USDA has given the industry a path forward for 2011,
12
activist groups have again attempted to derail the process by seeking to amend their case involving sugarbeet stecklings. They asked Judge White in San Francisco to enter a temporary restraining order and injunction to bar Roundup Ready sugarbeet crops in 2011. On February 18, Judge White denied plaintiffs’ motion to amend the complaint, finding that the new claims are not related to the old claims and, instead, are based on an entirely new record that the court has never reviewed. Judge White also noted that the interests of judicial economy would best be served if plaintiffs’ requests for injunctive relief were heard in the Grant case that we have filed in the United States District Court for the District of Columbia. The Grant case has been filed by the beet sugar industry against the Center for Food Safety, the Sierra Club, and USDA. Grower leaders and our staff want to be very clear that the sugarbeet industry deeply appreciates Secretary Vilsack’s leadership and USDA’s thorough scientific review reflected in this partial deregulation of Roundup Ready sugarbeets while work on the EIS continues. However, to address the uncertainty created by the Center for Food Safety’s vows to overturn APHIS’ determination, the sugarbeet industry has filed a lawsuit in the United States District Court for the District of Columbia that, in part, seeks a declaratory judgment that APHIS’ action fulfills the requirements of federal law. Because the sugarbeet industry feels that a few of the mandatory measures required by APHIS go beyond what is required under federal law, the lawsuit also asks the court to determine that certain of the interim measures adopted by APHIS impose an unnecessary burden. This lawsuit does not reflect a lack of respect or dissatisfaction with the significant work that USDA has undertaken to
By Luther Markwart Executive Vice President American Sugarbeet Growers Assn. address matters that are critical to our industry, including the opportunity to plant RRSB this spring. A tremendous amount of time and work by USDA officials went into the comprehensive EA, and growers need to fully recognize and appreciate that effort. On February 25, the Ninth Circuit Court of Appeals overturned an injunction that had ordered the destruction of sugarbeet stecklings (seedlings) that were genetically modified to tolerate labeled Roundup agricultural herbicides. The Appeals Court said that plaintiffs failed to show that the stecklings, being grown under permits from the U.S. Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS), “present a possibility, much less a likelihood, of genetic contamination or other irreparable harm.” The beet sugar industry’s growers, processors, technology providers and seed producers are pleased that the Ninth Circuit, after considering relevant legal precedents and evidence, concluded that the planting of these permitted stecklings was unlikely to cause harm, and that deference should be given to APHIS’ “technical expertise and judgments on this score.” The stecklings are intended for research and breeding purposes, as well as basic seed and hybrid seed production for 2012 and future years. The Appeals Court also said that it would address in a separate decision the appeal regarding the U.S. District Court for the Northern District of California’s August 13, 2010, order vacating the deregulation of biotech sugarbeets. No time frame was provided for when the decision will be made. In addition, also on February 25, the District Court judge in San Francisco, whose decision was the subject of the appeal, declined to hear another case brought by the plaintiffs regarding the next stage of Roundup Ready sugarbeet cultivation. ❖
THE SUGARBEET GROWER March 2011
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Cargill Begins Selling for New Louisiana Refinery Cargill announced that as of early February, it had officially assumed sales and marketing for Louisiana Sugar Refining (LSR) of which Cargill is one-third owner, and is shipping sugar to its customers. Cargill is the exclusive marketer of the industrialuse sugar produced by the refinery. “LSR is a key element in our sweetener supply strategy, and the LSR asset will fit nicely into the portfolio of products we bring to the market,� said Alan Willits, president of Cargill Corn Milling North America. “We are very happy to have the refinery producing sugar.� Louisiana Sugar Refining, LLC, is a joint venture among Sugar Growers and Refiners, Inc., Cargill and Imperial Sugar Company. Sugar Growers and Refiners, Inc., is a Louisiana cooperative representing eight sugarcane mills and more than 700 Louisiana sugarcane growers in the state. Sugar Land, Texas-based Imperial Sugar Company is the United States’ second largest sugar producer. �
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Peterson, Nelson Recognized For Service on ASGA Board Southern Minnesota grower Mike Peterson (Redwood Falls, Minn.) and Red River Valley grower Mark Nelson (Grand Forks, N.D.) were honored during the recent 2011 American Sugarbeet Growers Association annual meeting for their service as ASGA directors. Both retired from the board this year. Peterson had served as an ASGA director for eight years and Nelson for three years. New ASGA board members include Kelly Brantner of Felton, Minn., Chuck Steiner of Foxhome, Minn., and Keith McNamara of Bird Island, Minn.
Mike Peterson (left) receives a plaque from ASGA President Russ Mauch in recognition of his years of service as an association board member.
Retiring ASGA director Mark Nelson (left) is pictured here with Luther Markwart, the association’s longtime executive vice president.
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THE SUGARBEET GROWER (Upper Midwest) March 2011
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Planter Test Stand Schedule, Part II Provided at right is the second half of the 2011 North Dakota State University planter test stand schedule. Sugarbeet growers wishing to have
planter units checked out for wear and other potential problems should contact their sugar company agriculturist or the host site for an appointment.
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THE SUGARBEET GROWER (Upper Midwest) March 2011
A 1911 Beet Contract W
hat kind of a contract could you have expected, were you growing sugarbeets 100 years old? A 1913 USDA report titled “Systems for Marketing Farm Products and Demand for Such Products at Trade Centers” carried a copy of a typical contract as of a century ago. “With a large number of sugar companies, a flat price of, say, $5 a ton is offered the farmers for their beets — that is, all of the beets grown by the farmer have to be delivered to the company and they will receive a price for them figured at $5 a ton,” the report noted. It also explained that most factories offered a sliding payment scale wherein beets of a higher sugar content earned a bonus payment. “The weighing of the beets is done by the sugar company in the presence of a weigher, who may be appointed by an association of the farmers. The question of the weight of a lot of beets is a point of great contention between farmers and the company,” the report’s authors added. Here’s how the standard agreement used by “one large company” (probably Great Western Sugar Company) read, as of a century ago: 1. The grower agrees to plant, cultivate, irrigate, harvest, and deliver during the season of 1911, in compliance with the directions of the company, as may be given from time to time, ____ acres of sugar beets on the following-described lands, to wit, ___ quarter, section ___, township ___, range ___, ______ County, Colo. 2. Seed will be furnished by the company at 10 cents per pound; not less than2/19/08 20 pounds3:09 per acre 19587ParCom12h PM shall Pagebe1planted, and none other shall be used. 3. The grower agrees that all beets grown by him will be
delivered to the company, in the factory sheds or aboard cars, and as ordered by the company, properly topped at the base of the bottom leaf, subject to proper deductions for tare, free from dirt, stones, trash, or foreign substances liable to interfere with the work of the factory, and that he will protect the beets from sun and frost after removal from the ground. The company has the option of rejecting any diseased, frozen, or wilted beets, beets of less than 12 percent sugar or less than 80 percent purity, or beets that are not suitable for the manufacture of sugar. 4. Beets delivered and accepted will be paid for by the company at the rate of $5 per ton for beets testing 12 percent sugar, and 33-1⁄3 cents additional for each percent above 12 percent. Payment the 15th of each month for beets delivered during the previous month. 5. The company will pay 50 cents per ton additional for beets siloed and delivered; siloed beets shall not be delivered except upon call of the company. 6. The company will pay the freight on all beets delivered by railroad, but cars must be loaded to their capacity. Extra charges for cars loaded less than capacity will be charged to the grower. 7. The company will give to the grower, at the factory without charge, beet pulp not exceeding 20 percent of the weight of the beets delivered by him under his contract, providing the grower gives written notice to the company previous to July 1 of the quantity desired. 8. Any advances made to the grower by the company in the way of seed, cash, labor, or otherwise shall be considered as part payment for the crop of beets and be a first lien thereon. The grower agrees not to assign this contract without written consent of the company. 9. No agent of the company is authorized to change the provisions of this contract. ❖
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THE SUGARBEET GROWER (Upper Midwest) March 2011
U.S. Sugar, Circa 2020 hat levels will U.S. sugar production, use and imports be at in the year 2020? Awfully big question, very cloudy crystal ball. But USDA has ventured a prognostication as part of its long-term projections report released in February. The report was compiled by the Interagency Agricultural Projects Committee, comprised of representatives from 10 USDA agencies. The chart at right depicts the committee’s projections between now and 2020. “The two primary determinants of U.S. sugar supply and use over the longterm projection period are the implementation of the sugar and energy provisions of the 2008 Farm Act and reliance from Mexico to maintain balance in the U.S. sugar market,” the report notes. “The projections assume that sugar tariff-rate quotas are not increased above initial levels, and that U.S. policymakers aim for an ending year stocks-to-use ratio of 13.5%. Mexico is assumed to export sugar to the United States to meet this level.” Here’s a summary of the projections: • Mexican exportable sugar supplies are expected to rise due to increased use of high fructose corn syrup (mostly imported from the United States) that displaces sugar in beverage and food manufacturing end uses in Mexico. As a consequence, Mexico’s sugar exports to the higher-priced U.S. market grow over the decade and represent more than 15% of U.S. supplies at the end of the projection period, up from about 8% in 2010/11. The projections assume Mexico will import sugar from the lower-priced world market when necessary to assure sufficient supplies to meet their domestic consumption requirements. • Projected growth in U.S. beet and cane sugar production is low over the next decade. Beet sugar output averages 4.715 million short tons, raw value (STRV) over 2011/12 to 2020/21, and cane sugar production averages 3.567 million STRV. Sugar production thus averages only 72% of domestic consumption, far below the 85% minimum allotment level. • Deliveries of sugar for human use rebound in 2012/13 from the small changes in the prior two years. Gains over the remainder of the projections average 0.8% per year. • There are no sugar loan forfeitures in the projections, nor any CCC purchases of sugar for ethanol for use in the Feedstock Flexibility Program. With an
(in million short tons, by crop year)
Million short tons 12
USDA Ventures Long-Term Projections
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U.S. Sugar: Domestic Production, Use & Imports U.S. sugar: Domestic production, use, and imports Domestic use 10
8 annual stocks-to-use ratio of Production 6 13.5%, raw cane and refined beet sugar prices are above the mini4 Imports mum prices to avoid forfeiture for 2 the entire projection period. 0 Sugar refining capacity is suffi1990 1995 2000 2005 2010 2015 2020 cient to keep refined sugar prices Crop year from rising. The long-termThe equihistorically not high enough to period are two primary determinants of U.S. sugarhigh, supply but and use over the long-term projection the implementation of theexert sugar and energy provisions of theon 2008 Farmraw Act and an increased reliance librium world raw sugar price is asupward pressure U.S. and on pound sugar imports to maintain balance in the U.S. sugar market. sumed to equal 16 cents per — from Mexico refined sugar prices. ❖
THE SUGARBEET GROWER (Upper Midwest) March 2011
x
The 2008 Farm Act increased the raw sugar loan rate from 18 cents per pound in the 2008 crop year (October 2008-September 2009) to 18.25 cents per pound in the 2009 crop year, to 18.50 cen per pound in the 2010 crop year, and to 18.75 cents per pound in the 2011 and 2012 crop years. The refined beet sugar loan rate is specified to equal 128.5 percent of the raw cane sugar loan rate Marketing allotments for sugar are set annually at a level not less than 85 percent of estimated sugar deliveries for domestic human consumption. The 2008 Farm Act also introduced the Feedstock Flexibility Program, which requires the diversion of sugar from food use to ethanol producers, if needed, to keep sugar prices above levels at which sugar processors might otherwise forfeit sugar under loan to the Commodity Credit Corporation (CCC).
x
The projections assume that sugar tariff-rate quotas are not increased above initial levels and that U.S. policymakers aim for an ending year stocks-to-use ratio equal to that in 2008/09 of 13.5 percent.
x
U.S. producers do not expand area and growth in U.S. beet and cane sugar production is low over the projection period. Production averages only 72 percent of domestic consumption, far below th 85-percent minimum allotment level. Mexico is assumed to export sugar to the United States to meet the 13.5 percent stocks-to-use ratio.
x
Deliveries of sugar for human use grow at about 0.6 percent per year, less than population growth 0.9 percent (United States plus Puerto Rico). Per capita sugar consumption in 2010/11 is 61.7 pou and falls to 60.3 pounds in 2019/20.
x
There are no sugar loan forfeitures and no CCC purchases of sugar for ethanol. With an annual stocks-to-use ratio of 13.5 percent, raw cane and refined beet sugar prices are above the minimum prices to avoid forfeiture for the entire projection period. There is sufficient refining capacity to k upward pressure off refined sugar prices. The long term equilibrium world raw sugar price is assu to equal 16 cents per pound–historically high but not high enough to exert upward pressure on the U.S. raw cane price.
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February WASDE Report Summary U SDA’s February WASDE (World Agricultural Supply and Demand Estimates) report projected a higher U.S. sugar supply for fiscal 2010/11 than its January counterpart. The Feb-
ruary forecast total supply at 12.76 million short tons, raw value — up 139,000 tons from the prior month. The figure encompasses a beginning stocks level of 1.5 million tons, domestic
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beet and cane sugar production (combined) of 8.0 million tons and imports of nearly 3.25 million tons. On the domestic production side, beet sugar accounts for 4.8 million tons of the total projected supply and cane sugar for 3.21 million tons. Florida’s production of cane sugar was reduced 100,000 tons from the January forecast, based on processor estimates taking into account damage from freezing temperatures in December. Imports were forecast 239,000 tons higher in February compared to the previous month, mainly due to the pace of imports to date. Higher imports both from Mexico and under the re-export program more than offset reduced imports under the tariff-rate quota (TRQ). U.S. imports of sugar from Mexico during fiscal 2010/11 are currently forecast by USDA at 1.46 million short tons, raw value. That compares with an estimate of 1.25 million tons in the January WASDE report and just 807,000 tons during fiscal year 2009/10. Mexico’s sugar production this year is projected at 5.65 million (metric) tons, raw value — about 535,000 tons higher than that nation’s sugar output in 2009/10. U.S. 2010/11 sugar deliveries were forecast at 11.19 million short tons, raw value, in the February report. ❖
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THE SUGARBEET GROWER (Upper Midwest) March 2011
Increased efficiency and reduced labor saves time and improves profit potential. More flexibility, simplicity and dependability. Proven crop safety of the Roundup Ready® system. Broad spectrum weed control.
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EVERY BEET MATTERS TO US, BECAUSE EVERY POUND OF SUGAR MATTERS TO YOU. For Genuity® Roundup Ready® Sugarbeets in the U.S.: On February 8, 2011, the U.S. Department of Agriculture (USDA) published its decision to implement interim measures of deregulation with conditions for the planting of Genuity® Roundup Ready® Sugarbeets root crops, and of planting under USDA permit for Genuity® Roundup Ready® Sugarbeets seed crops. Genuity® Roundup Ready® Sugarbeets can only be sold, transported and planted in compliance with the conditions imposed by USDA and as set forth in mandatory compliance agreements with USDA, which must be in place prior to transport or planting. Growers must comply with the Monsanto Technology Stewardship Agreement (MTSA) Amendment and the Genuity® Roundup Ready® Sugarbeets Technology Use Guide (TUG) Addendum on www.Genuity.com. ALWAYS READ AND FOLLOW PESTICIDE LABEL DIRECTIONS. Genuity Icons, Genuity and Design®, Genuity®, Roundup Ready® and Roundup® are trademarks of Monsanto Technology LLC. ALWAYS FOLLOW GRAIN MARKETING AND STEWARDSHIP REQUIREMENTS. Details of these requirements can be found in the Trait Stewardship Responsibilities Notice to Farmers printed in this publication. ©2011 Monsanto Company.
Trait Stewardship Responsibilities Notice to Farmers For Genuity® Roundup Ready® Sugarbeets in the U.S.: On February 8, 2011, the U.S. Department of Agriculture (USDA) published its decision to implement interim measures of deregulation with conditions for the planting of Genuity® Roundup Ready® Sugarbeets root crops, and of planting under USDA permit for Genuity® Roundup Ready® Sugarbeets seed crops. Genuity® Roundup Ready® Sugarbeets can only be sold, transported and planted in compliance with the conditions imposed by USDA and as set forth in mandatory compliance agreements with USDA, which must be in place prior to transport or planting. Growers must comply with the Monsanto Technology Stewardship Agreement (MTSA) Amendment and the Genuity® Roundup Ready® Sugarbeets Technology Use Guide (TUG) Addendum on www.Genuity.com. For Genuity® Roundup Ready® Sugarbeets in the U.S.: The Monsanto Technology Stewardship Agreement is amended as follows: Grower agrees to transport and plant Genuity® Roundup Ready® Sugarbeets only for the production of a root crop, and not for seed production, and in compliance with the conditions imposed by the USDA under the deregulation with conditions and as set forth in mandatory compliance agreements with USDA, which grower agrees will be in place prior to transport or planting. Based on the decision of the U.S. Department of Agriculture (USDA) on January 27, 2011, Genuity® Roundup Ready® Alfalfa seed is available for sale and distribution by authorized Seed Companies or their dealers for use in the United States only. This seed may not be planted outside of the United States, or for the production of seed, or sprouts. Monsanto Company is a member of Excellence Through Stewardship® (ETS). Monsanto products are commercialized in accordance with ETS Product Launch Stewardship Guidance, and in compliance with Monsanto’s Policy for Commercialization of Biotechnology-Derived Plant Products in Commodity Crops. This product has been approved for import into key export markets with functioning regulatory systems. Any crop or material produced from this product can only be exported to, or used, processed or sold in countries where all necessary regulatory approvals have been granted. Do not export Genuity® Roundup Ready® Alfalfa seed or crop, including hay or hay products, to China pending import approval. It is a violation of national and international law to move material containing biotech traits across boundaries into nations where import is not permitted. Growers should talk to their grain handler or product purchaser to confirm their buying position for this product. Excellence Through Stewardship® is a registered trademark of Biotechnology Industry Organization. B.t. products may not yet be registered in all states. Check with your Monsanto representative for the registration status in your state. Cottonseed containing Monsanto traits may not be exported for the purpose of planting without a license from Monsanto. Individual results may vary, and performance may vary from location to location and from year to year. This result may not be an indicator of results you may obtain as local growing, soil and weather conditions may vary. Growers should evaluate data from multiple locations and years whenever possible. ALWAYS READ AND FOLLOW PESTICIDE LABEL DIRECTIONS. Roundup Ready® crops contain genes that confer tolerance to glyphosate, the active ingredient in Roundup® brand agricultural herbicides. Roundup® brand agricultural herbicides will kill crops that are not tolerant to glyphosate. Acceleron and Design®, Acceleron®, Biotech Yield AssuranceSM, Bollgard II®, Genuity and Design®, Genuity Icons, Genuity®, Respect the Refuge and Cotton Design®, Roundup Ready 2 Technology and Design®, Roundup Ready 2 Yield®, Roundup Ready®, Roundup®, SmartStax and Design®, SmartStax®, VT Double PRO™, VT Triple PRO™, YieldGard VT Triple® and YieldGard VT® are trademarks of Monsanto Technology LLC. Ignite® and LibertyLink® and the Water Droplet Design® are registered trademarks of Bayer. Herculex® is a registered trademark of Dow AgroSciences LLC. Respect the Refuge® and Respect the Refuge and Corn Design® are registered trademarks of National Corn Growers Association. All other trademarks are the property of their respective owners. ©2011 Monsanto Company.
Write Field
By David Kragnes
Change of Heart After all we have invested In our marriage through the years, After all the joy and laughter Working through the sweat and tears.
When I come home the house feels odd; I know someone’s been there. I even found some pants, not mine, One time upon a chair.
While raising up our children, Meeting every growing test, I tried to keep our house a home; I tried to do my best.
You think all that advice you see On shows like Dr. Phil, Applies to all those other guys. Not you, not yet, until.
Yet after more than 20 years Of doing all I can, It seems that it has come to this: She’s found another man.
You realize that it’s your wife Who loves a younger man. Even though you’ve tried to please And done the best you can.
I noticed subtle little things, Sometimes a distant stare. Or she would hum a little tune As if I wasn’t there.
Yet all of this will probably Turn out to be all right. In fact it’s really kind of fun When your grandson spends the night.
If I went to a meeting For an evening or a night, She’d pick the house up different, Putting some things out of sight.
David Kragnes farms near Felton, Minn. He is a former chairman of American Crystal Sugar Co., and currently serves on the board of directors of CoBank.
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THE SUGARBEET GROWER March 2011
30 Years Ago Excerpts from the March 1981 Issue of The Sugarbeet Grower Consumer Support for Comprehensive Sugar Policy Urged By Growers — “At the annual meeting of the American Sugarbeet Growers Association held in Tucson, February 2-6, Executive Vice President Richard Blake urged adoption of a policy that would provide U.S. consumers with a dependable supply of sugar at fair and stable prices. . . . According to Blake, since 1974 the U.S. has continued to move toward greater reliance on sugar exporting countries whose collective ability to supply domestic needs is neither constant nor predictable. “ ‘Since the expiration of our last sugar program seven years ago, consumers have been bearing the brunt of the havoc created by feast or famine sugar prices,’ asserted Blake. “Delegates at the meeting represented sugarbeet growers in 16 states who produce about 30 percent of the total U.S. annual [sugar] consumption.” Use of Corn for Fuel Alcohol: An Optimistic Future — “As much as 1 billion bushels of U.S. corn could be channeled into fuel alcohol production by 1987, ac-
cording to Martin Andreas, president of ADM foods division of Archer Daniels Midland. That corn would be used to produce 2.5 billion gallons of fuel alcohol, Andreas told the first International Colloquium on World Sweetener Policies for the 1980s. “The outlook for fuel alcohol from corn appears encouraging, but participants were less enthusiastic about producing alcohol from sugar. William Riddle, senior research scientist from the Battelle Memorial Institute, predicted that sugar will never be a feasible fuel source in the U.S. because sugar prices would have to drop to 10 to 11 cents a pound before such production would be profitable. However, [he] noted, as oil prices increase, minimum sugar prices also increase.” Electrical Energy Proves Effective in Weed Control — “A new agricultural product, designed to electrically kill broadleaf annual weeds that infest crop fields, is now being marketed. . . . The product is a tractor threepoint hitch mounted electrical discharge system (EDS), which develops 50 kilowatts of electrical power and is driven by the power takeoff (PTO) from the tractor. . . . Developed by Lasco, Inc., of Vicksburg, Mississippi, the Lightning Weeder has been field tested by university teams for both economics and effectiveness. . . . “The market testing was done in the Red River Valley sector of eastern North Dakota and western Minnesota. In this market area, the Lasco weeder has proved especially suitable for weeding sugarbeets and controlling volunteer sunflowers in soybeans and other crops.” ❖
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THE SUGARBEET GROWER March 2011
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Photos: Don Lilleboe
Transition Rapid & Successful Michigan Grower Chris Guza Embraces Strip-Till System & A Switch to Narrow Rows Above: Chris Guza’s SoilWarrior strip-till unit, first used in the fall of 2010.
T
hough 2011 will be just his third year producing sugarbeets under a strip-till system, Chris Guza has already implemented some big changes. First, he has replaced his original strip-till unit — a converted row-crop cultivator — with a new SoilWarrior machine manufactured by Environmen-
tal Tillage Systems (ETS). And second, he has now transitioned from 30-inch rows into 22s. Guza, who farms in Michigan’s Huron, Sanilac and Tuscola counties, moved into strip till in 2008 because of the opportunities he saw for reduced field passes in preparing his seedbed.
He was already planting his beets into a stale seedbed and liked it. “But we didn’t like how much effort it took to get the ground fit to stale seedbed,” he recounts. Most of Guza’s sugarbeets follow corn. “So we’d harvest the corn, shred the stalks, variable-rate apply our P and K (in separate passes), disk rip and then field cultivate.” The converted row-crop cultivator used to prepare a strip-tilled seedbed for most of his 2009 and 2010 beet acreage generally worked well. “But it was just a little too ‘tempermental’ in Below: The secondary ‘spring tillage’ configuration of Chris Guza’s SoilWarrior implement uses two 20-inch offset wavy coulters along with soil firmers and on-the-go adjustable air down pressure to match field conditions.
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THE SUGARBEET GROWER March 2011
My Land of Pride
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(877) (877) 373-8115 373-8115 w w w. svdhbeets.com
the corn stalks,” Guza relates. “It uses a shank, and we had some plugging behind corn in our heavy clay soils.” That’s why he opted to purchase the SoilWarrior last year from Faribault, Minn.-based ETS. The SoilWarrior offers both deeptillage and shallow-tillage configurations for a two-pass seedbed preparation regimen. For primary fall tillage, it uses a 30-inch serrated deep-tillage cog and containment coulter system to produce a tilled zone eight to 10 inches wide and up to 12 inches deep. Liquid or dry fertilizer can be applied with this pass.
Guza utilized the SoilWarrior on about 1,200 acres last fall, 400 of which were corn ground going into sugarbeets in 2011. With the shallow spring soil-conditioning pass, two 20-inch wavy coulters replace the deep tillage cog, conditioning and tilling the planting zone at a two- to four-inch depth. Subsurface fertilizer placement is again an option during this pass.
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Fall 2010 provided the first opportunity for Guza to try out his SoilWarrior. First, however, he traded out its original toolbar, set for 30-inch rows, for one set up for 22s. So he ended up working 12 22-inch rows while simultaneously banding on his dry P and K fertilizers. He tilled at the maximum depth of 12 inches, pulling the SoilWarrior with a Case IH STX 485 at speeds averaging 6.5 mph. Guza utilized the SoilWarrior on about 1,200 acres last fall, 400 of which were corn ground going into sugarbeets in 2011. “I went through standing corn stalks and never had any issues,” he reports. While his original plan was to forgo the soil-conditioning pass this spring, he may opt for that second pass after all. Because his 2010 corn was in 30inch rows and his 2011 beets will be in 22s, he ended up tilling on top of some of the old corn rows, and didn’t get as thorough an incorporation of the corn residue as he preferred. “But that’s just a transition issue, going from 30s to 22s,” Guza observes. “I don’t anticipate any problems [in future years].” One big benefit of the 30-inch deep tillage cogs on his new strip-till unit, he adds, is that “with this ‘wheel,’ you don’t get the smearing effect we get in our clay soils with a shank and point. So we’re not creating a hardpan at the bottom of the strip.” The SoilWarrior is equipped with GPS implement steering guidance, as is Guza’s planter. “RTK guidance really makes it work,” he affirms. “You can run a 60-foot planter, and guess rows aren’t a problem. “It’s all pretty exciting for us.” — Don Lilleboe ❖ — Chris Guza —
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THE SUGARBEET GROWER March 2011
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©2011 Syngenta Crop Protection, LLC, 410 Swing Road, Greensboro, NC 27409. Important: Always read and follow label instructions before buying or using Syngenta products. The instructions contain important conditions of sale, including limitations of warranty and remedy. Inspire XT is not currently registered for sale or use in all states. Please check with your state or local extension service before buying or using this product. Inspire® and the Syngenta logo are registered trademarks of a Syngenta Group Company. Syngenta Customer Center: 1-866-SYNGENT(A) (796-4368). www.FarmAssist.com MW 1SUG1005-P1 2/11
Sugar in Chile South American Nation Traditionally Among World’s Lowest-Cost Beet Sugar Producers By Peter Buzzanell*
Photo: IANSA, S.A.
Note: The green spot denotes the approximate main sugarbeet production region in Chile.
Chile’s beet sugar production has averaged 323,000 metric tons, raw value, over the past decade, and the sector continues to be among the world’s lowest-cost beet sugar producers. Growth in sugar consumption has led to substantial annual imports of refined sugar, with the bulk of these imports coming from other Latin American countries, particularly Argentina.
Production Most Chilean sugarbeet production is concentrated in Linares Province in the southeast part of the Maute Region in central Chile south of Santiago (green shaded area on above map). Linares has a favorable climate and good natural irrigation. Good growing conditions reflect a mild Mediterranean climate with hot, dry summers (NovemberMarch) and humid and rainy winters (May-September). Unusually cold and rainy spring weather can delay planting, and excessive heat in the summer can reduce yields. Planted sugarbeet area has averaged between 50,000 to 55,000 hectares (124,000 to 136,000 acres) annually over the past decade. Area and production shift marginally year to year, reflecting profitability of substitute crops compared with sugarbeets. Adverse weather conditions negatively influence yields, though irrigation can offset excessively dry * Peter Buzzanell is the director of Virginia-based Peter Buzzanell, LLC. Prior to his retirement from USDA, he was head of the Sugar & Sweetener Analysis Unit at that agency’s Economic Research Service.
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conditions. Beet sugar production has averaged 323,000 metric tons during the past five years, with 370,000 tons forecast for the 2011 campaign, which runs from April to August. Chile is among the world’s lowest-cost (field and factory) beet sugar producers, according to LMC International. While this South American nation has slipped from ranking as the number-one low-cost producer, LMC International still ranks it among the lowest five producers out of a survey of 36 beet sugar-producing-nations. The low costs are due primarily to impressive yields because of the aid of irrigation in most of Chile’s sugarbeet growing areas. Also, the mild climate permits fresh beets to be harvested over a long period. This climate also allows beet processing factories to operate for more than 150 days per year. The sole sugar company in Chile is IANSA, S.A. It both produces sugar from sugarbeets and imports refined sugar. IANSA finances the cultivation of sugarbeets, as well as farm labor and harvesting and the production of beets on long-
Chile Sugar Production, Imports & Consumption (Metric Tons, Raw Value) 2005 2006 2007 2008 2009 2010 2011*
Production 385,908 372,491 370,000 280,000 220,000 370,000 370,000
Imports 250,268 297,027 480,368 643,302 617,000 395,000 410,000
Consumption Campaign: 681,679 April-August 695,000 705,000 * Forecast 725,000 750,000 Source: International 765,000 Sugar Org. 780,000
THE SUGARBEET GROWER March 2011
term rented land. It operates five beet sugar factories with a combined daily slicing capacity of 24,100 (metric) tons. The factories (and their daily beet slicing capacity, listed in metric tons) are as follows: • Curico Iansagro — 5,800 MT • Linares Iansagro — 5,800 MT • Losangeles Iansagro — 3,400 MT • Nuble Iansagro — 6,000 MT • Rapaco Iansagro — 3,100 MT The Chilean government provides support to its sugar sector via a price band system. Price band levels are announced prior to the planting season in order to provide producers with information on the level of support they can anticipate. The goal is to promote domestic sugarbeet production and processing and simultaneously discourage excessive sugar imports. The price band works as follows: • The minimum import price is typically set above both the world and Chilean price. • When world prices are below the floor of the price band, a surcharge is applied on all sugar imports. This surcharge is based on the lowest quoted fob price necessary to bring cif/Santiago prices up to the price band floor. • Reductions from the normal 7%
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Price band levels are announced prior to the planting season in order to provide producers with information on the level of support they can anticipate. import duty apply when world prices exceed the ceiling of the band.
Consumption & Imports Chile has a population of about 16.6 million with an annual growth rate of 0.9%. Retail use of sugar continues to expand gradually, reflecting population growth. Sugar consumption has increased by 200,000 tons over the past decade and is forecast at a record 780,000 metric tons in 2011. Domestic use is being spurred by strong industrial utilization by bakery, confectionery and canned fruit products. Sugar-containing product exports are also fostering increasing use, led by confectionary products. The gap between consumption and production is growing, leading to more imports. Chile is a major importer of refined
sugar, with annual imports of between 400,000 and 600,000 metric tons. However, periods of excessive domestic stocks caused by a weakening in the economy can periodically lead to a sharp reduction in imports. Most of Chile’s refined sugar imports come from other Latin American countries — mainly Argentina, Guatemala and Colombia. Argentina was the leading supplier in 2006 and 2007, but Guatemala held that designation in 2008 and 2009. As noted, the Chilean sugar import regime is regulated by the price band system designed to protect domestic producers from excessive world market competition. Recently, values have been a price ceiling of $319 per ton (14.5 cents/lb.) and a price floor of $292 per ton (13.2 cents/lb.). According to the CEO of IANSA, the company is currently investing heavily in technological improvements. A US $50 million investment plan is underway, focusing on technology, mechanization and research to help lift yields, improve profits and ensure that imports are not excessive. This investment, along with its natural resource attributes, is likely to keep Chile as one of the world’s lowestcost beet sugar producers. �
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THE SUGARBEET GROWER March 2011
28th International Sweetener Symposium Is July 29-Aug. 3
Kevin Hall Receives Panhandle Outstanding Service-Ag Award
The 28th International Sweetener Symposium, hosted by the American Sugar Alliance, has been scheduled for July 29 to August 3, 2011, at the Stowe Mountain Lodge in Stowe, Vt. Event information is on ASA’s website — www.sugaralliance.org. Traditionally, about 400 people attend the symposium to hear about timely, significant issues affecting the sweetener industry and to interact with industry colleagues. This year’s event will include a look ahead to the next farm bill, as well as discussion of the U.S. and world market supply-demand outlook and the effects of multinational, regional and bilateral trade agreements on world sugar policies and U.S. commodity programs. Stowe is in north central Vermont, about 45 minutes from Burlington.
Kevin Hall, a leader in Nebraska’s sugarbeet industry who operates a diversified farming operation near Bridgeport, has been named the annual winner of the University of Nebraska-Lincoln Panhandle Research & Extension Center Outstanding Service to Panhandle Agriculture Award. The award was presented February 15 at the annual meeting of the Nebraska Sugarbeet Growers Association by Dr. Linda Boeckner, Panhandle Center director. Hall produces wheat, corn, dry edible beans, sugarbeets and sorghum, and also operates a beef feedlot. He has been a leader in agricultural organizations, especially those related to sugarbeets. One of the initial committee members to organize the growers’ purchase of Western Sugar, he has
The Future Face of Sugarbeets A photo of threeyear-old Caleb Rutherford of Grafton, N.D., that appeared in The Sugarbeet Grower’s January issue prompted Katie Vader to send us a photo of her son, one-year-old Thomas. This great photo was snapped during the 2010 Michigan sugarbeet harvest. “Already interested in tractors and trucks, Tom is well on his way to being a fifth-generation farmer at Vader Farms, Inc.,” writes his mother. Thomas’ parents, Dan and Katie Vader, farm near Akron, Mich., along with Dan’s parents, Doug and Vickie Vader, and grandparents, Donald and Jennie Vader.
THE SUGARBEET GROWER March 2011
Photo: UN Panhandle Station
Around The Industry
Kevin Hall is shown here with his wife, Vickie, and parents, George and Jeanette. been on the Western Sugar Cooperative board since its formation and currently serves as the co-op’s chairman. “Rightly, this award should be given to Kevin and his wife, Vickie, and his parents,” said UNL machinery systems engineer John Smith, who nominated Hall. “His parents, George and Jeanette Hall, have helped him get started and encouraged his progress.” Smith describes Hall as a leader by example in the Panhandle irrigated agriculture community, always willing to try something new if he can be convinced that it has a good chance of contributing positively to his operation. He’s also willing to share his ideas with anyone. Smith said it’s common for other farmers to look to Hall as an example, and many growers visit with him about his operation. Hall was the first Nebraska beet grower in recent times to purchase a European-style, self-propelled harvester (Ropa); also one of the first in the United States to do so. In the four years since, two other Nebraska growers have followed his lead. Hall has participated with UNL on several projects and has allowed faculty to conduct demonstrations in his fields, including direct harvest of dry beans; field-scale comparison of 18-inch and 30-inch row sugarbeets; and comparison of harvest loss and soil compaction between the self-propelled system and conventional methods. Recently, he has switched from 30inch rows to 20-inch rows — a major system change but a progressive one — to improve production efficiency. The Outstanding Service to Panhandle Agriculture Award is given by Panhandle Research & Extension Center faculty in recognition of a person or group who has provided outstanding service to Panhandle agriculture.
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