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FB members ask lawmakers to stop regulatory overreach BY DIRCK STEIMEL Decisions by the Environmental Protection Agency (EPA) and other federal agencies to broaden the definition of regulated waters are unfair and could ultimately drive family farmers out of business, Iowa Farm Bureau members emphasized last week in meetings with all members of the Iowa Congressional delegation in

Washington, D.C. “It’s a very big concern for us,” said Clinton County Farm Bureau member Dustin Johnson during a meeting with Iowa Rep. Dave Loebsack. “We don’t want to see farmers, who are doing the right thing, be burdened by a ton of permits and paper work. That’s only going to take time and money away from doing the things that would actually benefit

the environment.”

Questions on water rule Johnson and other Iowa farmers were reacting to a proposal announced last week by the EPA and the U.S. Army Corps of Engineers to clarify which streams and other bodies of water are subject to the regulation through the Clean Water Act. (For more on the EPA announcement see article on

page 4 of the Spokesman.) While the agencies claim to have taken agricultural concerns into account by creating exemptions, farmers reject the concept that there needs to be exemptions, said Blake White of the Appanoose County Farm Bureau. “We don’t believe that they have the authority to regulate these areas and we really see this as a grab for control of private

property.” Along with concern about regulatory overreach, the Iowa Farm Bureau members urged lawmakers to keep up the pressure to overturn the EPA’s proposal to reduce 2014 ethanol requirements in the Renewable Fuels Standard (RFS); to support proposed trade agreements that span the Pacific and Atlantic oceans and the reauthoriWASHINGTON PAGE 2

Lower crop prices push Iowa land prices lower BY TOM BLOCK Iowa farmland values fell 5.4 percent since last September, the first decrease in five years, according to a survey of Iowa farmland realtors. Lower corn and soybean prices fueled the decrease, according to survey coordinator Kyle Hansen. Both corn and soybean prices are off about $2 per bushel since last summer and crop insurance guarantees for both crops are also significantly lower compared to last year. “It’s actually a relief to me,” said Hansen, an agent with Hertz Real Estate in Nevada. “It shows buyers are looking at commodity prices. They’re using their profitability as a guide of what to pay for farmland. It’s not a bubble.” The farmland market has stabilized since the beginning of the year as crop prices rallied and crop insurance guarantees became known, he said. “To me, this is actually an encouraging number. Back in November and December, I thought we might see lower yet,” Hansen said. “We’re no longer worrying about corn going to $3.50. Just having some uncertainty taken out adds a lot of stability to the market.” The statewide average for an acre of farmland was $8,286, down from $8,758 per acre in September, according to the Iowa Realtors Land Institute (RLI) survey. It marked the first time values have declined since 2009. Last September’s survey showed a modest increase of 1.2 percent, indicating farmland values have declined 4.2 percent since last March. High quality farmland, off 4.9 percent since September, held its value better than lower classes of property. Medium and low quality LAND PAGE 2

Nation’s leaders laud Iowa’s Borlaug Read excerpts from speakers at the ceremony for the unveiling of the Borlaug statue and learn about the sculptor. STORY ON PAGE 3

EPA proposal could hurt conservation

Members of the Borlaug family joined top leaders from Iowa and U.S. Congress last week to celebrate the unveiling of the Norman Borlaug statue in the U.S. Capitol. From left are: Bill Borlaug, House Minority leader Nancy Pelosi, U.S. Agriculture Secretary Tom Vilsack, House Speaker John Boehner, Jeanie Borlaug Laube, Iowa Gov. Terry Branstad and Senate Majority Leader Harry Reid. PHOTO/ DIRCK STEIMEL

Iowa farmers find inspiration in Borlaug’s accomplishments BY DIRCK STEIMEL

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he life and accomplishments of Norman Borlaug, who worked tirelessly to improve agriculture through research, adaptation and experimentation,

continue to be an inspiration for those in agriculture today, Iowa Farm Bureau members said last week during ceremonies for the unveiling of the statue of Borlaug in the U.S. Capitol. “This is a huge recognition, not just for Iowa, but for agricul-

ture in general and the mission we have to feed the world,” said Craig Hill, president of the Iowa Farm Bureau Federation (IFBF). “We all attempt to do better, we want to be more productive, more efficient and to be better stewards BORLAUG PAGE 2

Iowa’s plan to reduce nutrient loss and improve water quality could be at risk if the EPA’s proposal is adopted. STORY ON PAGE 4

Dairy prices surge on strong exports Overseas demand, led by China, is pushing dairy prices near record territory. STORY ON PAGE 5

Spring is slow to make its way to Iowa It’s the same old tune as April looks to be cooler than normal, according to Dan Hicks of Freese-Notis Weather. STORY ON PAGE 8

COPYRIGHT 2014

FARM PROGRAM LIKELY TO BEGIN AT END OF 2014

NOMINATIONS SOUGHT FOR SOIL CONSERVATION

Sign up for key commodity programs, including Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC), are not likely to begin before nearly the end of calendar 2014, according to Krysta Harden, Deputy U.S. Agriculture Secretary. “These are complex programs and producers will have to sign up for the life of the farm bill, so we want to make sure we have it right,” Harden said last week during a taping of Agri-Talk that Iowa Farm Bureau members attended while in Washington, D.C. Separately, U.S. Agriculture Secretary Tom Vilsack announced changes included in the new farm bill that are designed to help beginning farmers, including greater flexibility in determining eligibility, raising loan limits and emphasizing beginning and socially disadvantaged producers. The changes represent just one part of a series of investments the new farm bill makes in the next generation of agriculture, Vilsack said.

Farm Bureau members can nominate deserving farmers for the Conservation Farmer of the Year award, co-sponsored by the Iowa Farm Bureau Federation and the Iowa Department of Agriculture and Land Stewardship. This recognition program began in 1952 and highlights the continuous voluntary conservation improvements made by all Iowa farmers, but focuses on regional and statewide winners. The statewide winner this year will have the free use of a John Deere 6D Series utility tractor for up to 12 months courtesy of Van Wall Group. The award helps raise awareness of the great things all Iowa farmers do to conserve state soil and water resources. To nominate a farmer, write a brief (no more than 100 words) letter summarizing the individual’s conservation efforts and send it to your county Soil & Water Conservation District office before June 1.


IOWA FARM BUREAU SPOKESMAN APRIL 2, 2014

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Editorial America’s leaders praise Borlaug’s extraordinary work brilliant vision, hard work, Iowa common sense and commitment. Dr. Borlaug will continue to inspire a generation of scientists and farmers to innovate and lift those mired in poverty.”

BY DIRCK STEIMEL Norman Borlaug was, by all accounts, a very humble man. The farm boy from Cresco worked tirelessly to improve crops and feed hungry people around the world. He never sought fame or fortune. Yet his accomplishments stand tall, earning him the Nobel Peace Prize, the Congressional and the Presidential Medal of Freedom, and now a statue in the U.S. Capitol. Borlaug’s work, his humility and his fervor were extolled last week by national and state leaders at the unveiling of his statue in the Capitol. Here are excerpts of some of those remarks: Iowa Sen. Tom Harkin: “When I think of Dr. Borlaug I think of those famous words from the book of Proverbs: “Where there is no vision, the people perish.” “More than a half century ago Dr. Borlaug surveyed a world

Iowa Gov. Terry Branstad speaks at the unveiling ceremony for the statue of Norman Borlaug in the U.S. Capitol. PHOTO/WORLD FOOD PRIZE FOUNDATION

where starvation and malnourishment were rampant and he had a vision—a vision of a green revolution. Because of that vision ... because of Dr. Borlaug’s tireless commitment to that vision ... people did not perish. His work was at the forefront of a 50-year period that has been described as the single greatest food production and hunger reduction in all human

history. Not bad for a farm boy from Cresco, Iowa. Not bad for a kid who began his school work in a one-room rural schoolhouse.” Iowa Sen. Charles Grassley: “Norman Borlaug may not be a name known at every kitchen table. But this man is one of the greatest humanitarians who ever lived. Dr. Borlaug combined a

Sculptor comes to appreciate Borlaug’s work and passion for feeding people

Spokesman Editor DIRCK STEIMEL News Coordinator TOM BLOCK Senior Features Writer TERESA BJORK Ag Commodities Writer BETHANY BARATTA Photographer/Writer GARY FANDEL

Iowa Rep. Bruce Braley: “As we come here today, we need to remember that Norman Borlaug’s legacy won’t be determined by what he did on his time on earth. It will be determined by what we do together to expand his vision of stewardship for this planet and the people who live on it. As Dr. Borlaug always reminded us, our reward for our labors is not what we take from the world, it is what we give back. So let’s get to work.” U.S. Agriculture Secretary Tom Vilsack: “I think if Norman were here today I think he would have wanted to acknowledge someone else. He didn’t do this all by himself. As great as he was, as visionary as he was, he needed partners, farmers in the United States and other countries. Norm understood that they had to be convinced that a better and brighter day was ahead and he worked tirelessly with those partners to make that happen.”

BY DIRCK STEIMEL Norman Borlaug impressed nearly anyone who came in contact with him or studied about his passion and accomplishments. Add to that list Benjamin Victor, the sculptor who created the Borlaug statue that was unveiled last week at ceremonies in the U.S. Capitol. Victor admits that he didn’t know much about Borlaug or the crop researcher’s work when he was contacted about creating the statue. But since then, the South Dakota-based artist has joined the ranks of those in awe of Borlaug and his accomplishments. “It was actually life changing for me learning about him and all he did,” Victor said during the ceremonies surrounding the statue dedication. “Reading his biography, learning about his focus and drive and commitment and his cause really affected me,” Victor said. The sculptor’s affection for Borlaug went way beyond the Iowan’s plant breeding and efforts

Iowa Rep. Tom Latham: “One thing that made Dr. Borlaug so successful was his passion and his focus of applying that breakthrough to get it out there so people can actually reap the benefits of his discoveries. He didn’t do anything for fame or fortune, it was all about feeding a hungry world and making sure those children, wherever they are, were not starving.”

Sculptor Benjamin Victor before the unveiling ceremony of the statue he created of Norman Borlaug. Victor said that learning about the native Iowan was “life changing.” PHOTO/DIRCK STEIMEL

to use science to solve the scourge of malnutrition. “His care for others was so impressive. The man had so much fervor for what he was doing and it’s moving to me even now. To just be a part of it is very humbling.” Victor also created the statue of Sarah Winnemucca that represents Nevada in the Capitol’s Statuary Hall. He was 26 when he created that statue, the youngest artist ever to have a piece placed in the

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To place a free exchange ad, contact your county office for information. The Iowa Farm Bureau Spokesman (ISSN 0021-051X) is published weekly by the Iowa Farm Bureau, 5400 University Avenue, West Des Moines, IA 50266. Subscription price of $2 per year for mailing in the continental USA included in the dues of Farm Bureau members in Iowa. Additional subscription fee required for mailing outside the continental USA. Periodical postage paid at Iowa Falls, Iowa. Members please send change of address to your county Farm Bureau office. Postmaster send address changes (POD FORM 3579) to Iowa Farm Bureau Spokesman, P.O. Box 670, Iowa Falls, Iowa 50126. Letters to the editor and statewide news articles should be sent to Editor, Iowa Farm Bureau Spokesman, 5400 University Avenue, West Des Moines, Iowa 50266. Reprinting of Spokesman articles and photographs is not allowed without permission.

Capitol’s ornate Statuary Hall. Each state has two sculptures in Statuary Hall. The new statue of Borlaug replaces one of James Harlan, a U.S. Senator for Iowa and later U.S. Secretary of the Interior. The Harlan statue will be moved to his hometown, Mount Pleasant, and will be placed at Iowa Wesleyan College. The other Iowa statue is of Samuel Kirkwood, an Iowa governor during the Civil War and U.S. Senator. Iowa Farm Bureau Federation: Craig Hill, President; Joe Heinrich, Vice President; Denny Presnall, Secretary-Treasurer and Executive Director; Edward G. Parker, General Counsel. Board of Directors: District 1 - Carlton Kjos, Decorah. District 2 - Charlie Norris, Mason City. District 3 - Phil Sundblad, Albert City. District 4 - Doug Gronau, Vail. District 5 - Mark Buskohl, Grundy Center. District 6 - Nick Podhajsky, Traer. District 7 - Andrew Hora, Riverside. District 8 - Calvin Rozenboom, Oskaloosa. District 9 - Jim McKnight, Afton.

Iowa Gov. Terry Branstad: “Norman Borlaug was an innovator who put science in the hands of those who needed it most all over the world. Dr. Borlaug’s accomplishments are also especially inspiring for Iowa’s young people as they pursue careers in science, technology, math and engineering We hope his legacy will inspire future generations of Americans and his humble spirit will long be remembered. May God bless the State of Iowa and the United States of America.”

Ceremony for Borlaug sows a bipartisan tone BY DIRCK STEIMEL It was cold and snowy in Washington, D.C., on March 25, the day that the Norman Borlaug statue was unveiled in the U.S. Capitol. But when the goal is honoring the Iowa farm boy who grew up to lead the Green Revolution, partisan differences tend to melt away, even in a highly partisan town like our nation’s capital. Our government may be sharply divided, but there was nothing but unity in the efforts to honor Borlaug. Republicans and Democrats all became simply Iowans as they joined to have the new statue represent our state, and to accomplish it by the self-imposed deadline: the 100th anniversary of Borlaug’s birth on March 25, 1914, in Howard County. “When it was time for it come together it was just magical,” said Rep. Steve King, a Republican who represents northwest Iowa. Rep. Dave Loebsack, a Democrat who represents the southeast part of the state, readily agreed. “This really shows that we can work together,” he said. Loebsack noted that the statue of James Harlan, which the statue of Borlaug replaced, is going back to Iowa Wesleyan College in Mount Pleasant, which is in his district. “I get a two-fer out of this,” he joked.

Celebration of Iowa pride All joking aside, it was a great celebration of pride in Iowa and praise for Borlaug. “He represents Iowa humility and hard work,” Iowa Gov. Terry Branstad said. “Now the people that come to the nation’s capital will be able to learn more about Norman Borlaug and the real difference he made in the world.” Kenneth Quinn, president of the World Food Prize Foundation and driving force behind the Borlaug statue, also recognized the rare, but welcome, bipartisan streak that was germinated by honoring a great man. “It’s interesting that when the partisan differences were at their greatest level, that we were able to come together and do this,” he said. It’s fitting, of course, that partisanship seemed to disappear when Iowans and others honored Borlaug. He was a man who was all about working hard to feed struggling people without regard to politics or nationality. As an Iowa farm boy, he knew it was simply important to get things done. It’s a tried and true Iowa trait. As Branstad noted: “When Iowans get together for a great cause, there is nothing that can stop them.”


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APRIL 2, 2014

IOWA FARM BUREAU SPOKESMAN

EPA proposal could slow farmers’ conservation efforts BY TOM BLOCK A proposal last week by the Environmental Protection Agency (EPA) greatly expands the definition of waters regulated by the federal government and could slow conservation efforts of Iowa’s farmers, Iowa Farm Bureau environmental policy advisor Rick Robinson said last week. The EPA and U.S. Army Corps of Engineers jointly released the proposed rule “to clarify protection under the Clean Water Act for streams and wetlands,” the agencies said last week. The EPA proclaimed the proposal preserves Clean Water Act exemptions and exclusions for agriculture, but the 371-page rule contains a number of troubling terms that provide considerable leeway for the agencies to exercise permitting authority over farmland, said Robinson.

Adding to confusion “It adds to the confusion about whether farmers will need a federal permit to install certain conservation practices already exempted by the Clean Water Act because they may take place near a newly regulated water or wetland,” said Robinson. “The Iowa Farm Bureau is hopeful that proposal will not delay the plans farmers are making to put conservation practices in place. If these time-consuming permits are required, the progress farmers would like to make in implementing the Iowa Nutrient Reduction Strategy or otherwise

A proposal by the Environmental Protection Agency to expand the definition of “waters of the United States” could slow farmers’ conservation projects and implementation of the Iowa Nutrient Reduction Strategy. PHOTO/GARY FANDEL

improving water quality will be postponed, more costly to achieve and, in some cases, abandoned.” The proposal expands federal regulatory programs under the Clean Water Act into areas traditionally managed by states, Robinson said. Until now, the Clean Water Act’s grant of authority to the EPA and the Corps of Engineers has not changed in the 42 years that it’s been in place. Additionally, the two most recent, relevant U.S. Supreme Court decisions on the issue both clearly said there are limits to federal jurisdiction, he said. The proposed rule states that the EPA considers its jurisdiction over “waters of the United States” to include waterways that only flow seasonally or after a rain. “The health of rivers, lakes, bays and coastal waters depend on the streams and wetlands where

they begin,” the EPA and Corps said in a press release. “About 60 percent of stream miles in the U.S. only flow seasonally or after rain, but have a considerable impact on the downstream waters. These are important waterways for which EPA and the Army Corps is clarifying protection.”

Significant nexus Specifically, the proposed rule states that most seasonal and raindependent streams are regulated as navigable waters, as are wetlands near rivers and streams. Other types of waters “may have more uncertain connections with downstream water and protection will be evaluated through a case specific analysis of whether the connection is or is not significant,” the agencies said. “To be considered jurisdictional you must have a significant nexus,” EPA Administrator Gina McCarthy

told reporters, emphasizing the agency’s stance that the rule does not expand the Clean Water Act. “We have to show that a pond or wetland significantly affects other jurisdictional waters.” The EPA said normal farming activity — including plowing, seeding, cultivating, “minor” drainage and harvesting — that does not result in a point source discharge of pollutants into waters of the U.S. does not require a permit. The EPA and Corps also worked with the USDA’s Natural Resource Conservation Service (NRCS) to exempt 53 established NRCS conservation practices implemented in accordance with published standards if they occur in waters covered by the Clean Water Act.

Delaying conservation However, Robinson said the language leaves considerable room for interpretation on whether standing water in a farm field, private pond or road ditch is “significantly connected” to a “water of the U.S.” Recent actions by the Corps of Engineers to expand permit application reviews in Iowa are already delaying farmers’ plans to get conservation on the

ground, and the proposed Clean Water Act rule could create additional backlogs, he said. “Farmers have to make rapid adjustments when making conservation and planting decisions and caring for their crop,” said Robinson. “As the EPA and the Army Corps of Engineers grab more authority, it will be difficult, if not impossible, to make ordinary farming decisions in a timely manner. The regulatory system is not geared to issue hundreds of permits in a short amount of time, and farmers can’t wait weeks or months to have a decision made for this year’s construction season and crop.” The proposed rule will be open for public comment for 90 days following publication in the Federal Register. Farm Bureau is analyzing the proposal carefully and will submit comments, Robinson said. “We do not believe the EPA has adequately considered the economic and practical implications of this rule on the nation’s cities, farmers and businesses,” he said. “We look forward to further review of the proposal and participating in the public comment process.”

FDA: Most animal drug firms agree to end antibiotics in feed The Food and Drug Administration (FDA) said last week it had received positive written commitments from all but one of the 26 animal pharmaceutical companies on its request that they phase out the use of antibiotics for growth promotion in livestock. In December, the agency asked the companies to stop selling antimicrobial drugs for growth promotion. It also asked the companies move drugs from “over the counter” to a status requiring veterinary oversight.

Last month the Animal Health Institute (AHI) and the Generic Animal Drug Alliance (GADA), which represent most animal drug companies, committed to the voluntary guidelines. “Most of the antibiotics are used for treatment and control and prevention of disease, and very little [are] actually used strictly for growth promotion,” said Richard Carnevale of AHI. The FDA did not identify the company that did not respond positively to its request.

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IOWA FARM BUREAU SPOKESMAN APRIL 2, 2014 5

Export demand sparks Labre Crop Consulting earns RRIA award surge in dairy prices BY BETHANY BARATTA Strong dairy exports carried milk prices higher last year, and that’s likely to continue. But as the global dairy supply increases as a result of higher prices, dairy farmers are likely to see lower prices by the end of this year, said Kristen Schulte, farm and ag business management specialist for Iowa State University (ISU) Extension and Outreach. The 2013 average all-milk price increased $1.48 per hundredweight from 2012’s prices to $20.01 per hundredweight, Schulte said. This was the second highest all-milk price annual average and was only 13 cents less than the record set in 2011. Prices have continued to push higher since the beginning of the year, with the April Class 3 Milk futures contract at the CME gaining nearly $5 per hundredweight since Jan. 1 to close last Friday at $23.81. The price gains have been driven by a surge in dairy exports, which set a record in 2013, totaling 15.5 percent of U.S. milk production on a total solids basis, Schulte said. China’s imports of milk powder, cheese, butterfat, and whey in the September-January period were up 66 percent from the prior year, the U.S. Dairy Export Council said in a recent report.

Production gains While milk production has been stagnant over the winter months due to weather-related dairy health issues, seasonality production and the quality of forages harvested last fall, production is expected to pick up for the rest of the year, Schulte said. “Although beef (cull) prices are attractive, herd expansion is expected due to higher milk prices,” she said. U.S. milk production in the 23 major milk-producing states including Iowa during February totaled 14.9 billion pounds, up 1.4 percent from February 2013, according to the U.S. Department of Agriculture’s (USDA) milk production report issued recently. The number of milk cows on farms in the 23 major milk-producing states increased 13,000 head from February 2013, the report said. Looking ahead, global milk supplies are expected to increase at the

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end of the year, Schulte said. “Global dairy product stocks are low and increased demand from China and developing countries all lead to supporting stronger milk prices, but the demand for U.S. products will likely slip some later in the year leading to slightly lower prices at the end of 2014,” Schulte said. The U.S. Dairy Export Council says China is expected to slow its dairy purchases; China typically buys 15-20 percent less in the second and third quarters compared with the fourth and first quarters, the council noted. Schulte said this period of higher prices offers Iowa dairy farmers the opportunity to pay down debt, invest in capital improvement to increase efficiency, and invest to expand the dairy farm and/or increase working capital. Schulte said every dairy farm is different and there are no magic price triggers when it comes to prices; farmers should know their operating costs and work to lock in a profit.

The latest winner of the Iowa Farm Bureau Renew Rural Iowa (RRIA) Entrepreneur award is using the latest technology to help farmers accomplish their conservation and production goals. Labre Crop Consulting of Manson, started by Calhoun County farmers Brent and LuAnn Johnson, is a crop consulting and data management business that helps farmers do everything from assessing the efficiency of fertilizer applications on their fields to improving soil and watershed conservation. Started in 2006, Labre uses GPS technology, soil sampling and drone-gathered imaging to make highly detailed, custom recommendations for farmers. “We started by working a lot of telematics and different things to transfer information we gathered from farm operations and remote sensing equipment to help farmers make the best decisions for their farms,” says Brent Johnson. The company is now using drone technology to conduct field assessments and collect high-resolution field images that can identify individual plants. Labre has grown from a start-up

Soil sampling is a key component of Brent and LuAnn Johnson’s Labre Crop Consulting, the latest winner of the Iowa Farm Bureau’s Renew Rural Iowa Entrepreneur award. FILE PHOTO

company to its current size of nine full-time and 10 seasonal employees. Calhoun County Economic Development Executive Director Pam Anderson says that kind of success benefits the entire area. “We don’t have a lot of industries

here in Calhoun County, so small businesses make up a lot of our economy. Keeping our young people local is important because we want them to stay around and work and raise their families here. Labre is helping us do that,” she says.


6 APRIL 2, 2014 IOWA FARM BUREAU SPOKESMAN

Report shows interest in expanding pork output

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he U.S. and Iowa hog and pig inventory shows farmers are interested in raising more hogs as prices soar, analyst said. The report, however, didn’t show a clear impact of the porcine epidemic diarrhea virus (PEDV) on the U.S. swine herd. The United States inventory of all hogs and pigs on March 1, 2014, was 62.9 million head, the U.S. Department of Agriculture’s (USDA) quarterly hogs and pigs report said last week. This was down 3 percent from March 1, 2013. Iowa’s March 1 inventory of all hogs and pigs was 19.8 million, the report said. This was down from 20.1 million on March 1, 2013, the report said. The December 2013-February 2014 U.S. pig crop, at 27.3 million head, was down 3 percent from 2013. Pre-report estimates about the size of the pig crop ranged from down 9.2 percent to an increase of 1.4 percent, showing the uncertainty about the impact of PEDV, said Steve Meyer and Len Steiner, authors of the Daily Livestock Report. “The extent of the death losses may not be completely reflected in the pig crop number,” Meyer and Steiner wrote in their report. Sows farrowing during this peri-

od in the United States totaled 2.87 million head, up 3 percent from 2013. The sows farrowed during this quarter represented 50 percent of the breeding herd. The average pigs saved per litter was 9.53 for the December-February period, compared to 10.08 last year. U.S. breeding inventory, at 5.85 million head, was up slightly from last year, and up 2 percent from the previous quarter. Iowa’s breeding inventory, at 1.01 million, was down from 1.02 million on March 1, 2013. Higher breeding inventory suggests farmers are gearing up for herd expansion, hoping to take advantage of red-hot prices. U.S. market hog inventory, at 57 million head, was down 4 percent from last year, and down 5 percent from last quarter. Iowa market hog inventory, at 18.79 million, was down from 19.08 million on March 1, 2013,

the USDA report said.

Virus impacts supply The overall effect of the Porcine Epidemic Diarrhea Virus (PEDV) on the nation’s hog supply will be steeper and longer than first estimated, according to a new report from Rabobank Group. The global financial services company predicts that North American hog production and slaughter will decrease by as much as 7 percent this year and will be 12.5 percent below 2013 levels through 2015. Rabobank said the virus has already affected about 60 percent of the U.S. breeding herd, 28 percent of the herd in Mexico and is moving into Canada. North American hog slaughter may decline by nearly 18.5 million hogs this year and next. The 2014 drop alone would be the largest in 30 years, according to Rabobank. Rabobank also predicts that the U.S. poultry industry is poised to reap the benefits from the PEDV outbreak, especially since U.S. beef production is expected to decline by nearly 6 percent this year. The situation places poultry as the “protein of last resort” as chicken prices and margins climb in the spring and summer, the report notes. The latest USDA update documented more than 4,700 cases of PEDV reported across 27 states. It is difficult to estimate the total

U.S. to import poultry USDA’s Food Safety and Inspection Service (FSIS) announced last week a final rule allowing poultry imports from the Republic of Korea. Certified Korean plants will be eligible to export poultry products to the United States, effective May 27.

03/29/2013 101,300 $127.92 1318 $189.05 $188.38 $14.25 29,888 $127.08 $202.91

Argentina crop estimates Argentina expects a record soy crop of 54 million metric tons to be collected in the 2013-14 season, the agriculture ministry said in its monthly crop report last week, forecasting an increase of 9.5 percent over the 2012-13 harvest. The ministry expects this season’s corn crop at 29.8 million metric tons, down 7.2 percent from the 2012-13 crop year. The Buenos Aires Grains Exchange increased its estimate for Argentina’s 201314 corn crop to 24 million metric tons from 23.5 million.

CME Class III Milk Futures Closing prices March 28, 2014 Contract March 2014 April 2014 May 2014 June 2014

Settle $23.26 $23.81 $21.64 $20.49

Spot Prices Block Cheese Barrel Cheese Butter NFDM Grade A

Last Week $23.29 $23.53 $21.74 $20.87

$2.3850 $2.2900 $2.0000 $2.0300

Contract July 2014 August 2014 September 2014 October 2014

Settle Last Week $20.30 $20.60 $20.04 $20.29 $19.73 $19.92 $19.37 $19.50

Milk Prices March Class III March Class IV

$23.81 $23.52

Iowa Hay Auctions Dyersville, March 26 Hay, large squares, supreme, premium, $200-255; good, $135-170; fair, $100-130; utility, $70-110; large rounds, good, $100165; fair, $80-100; utility, $67.50-85. Straw, large squares, good, $35-56. CRP, large squares, good, $72.50. Mixed, large squares, good, $150-212.50; large rounds, $100-130. Grass, large rounds, good, $80-140; fair, $65-80.

Ft. Atkinson, March 26

Weekly Average Price Comparison Sheet Price comparisons: Week ending: 03/28/2014 02/28/2014 Cattle - National 5 Area Confirmed Sales 76,364 92,724 5 Area 65-80% Choice Steers: Wtd Avg. $151.37 $149.99 Average Weights (Estimate) Cattle 1327 1337 Boxed Beef Choice 600-750 (5 day avg.) $234.46 $225.33 Boxed Beef Select 600-750 (5 day avg.) $227.34 $223.12 Five Day Average Hide and Offal Value $16.03 $15.46 Cattle - Interior Iowa - Minnesota Supply: 25,410 32,419 Average Price Choice Steer: Live Basis $151.91 $149.67 Average Price Choice Steer: Dressed Basis $240.71 $240.25 Feeder Steers at River Markets (Neb. Feedlots) #1 Muscle Thickness 500-600# $229.53 $223.94 #1 Muscle Thickness 700-800# $184.33 $178.43 Hogs -- Interior Iowa - Minnesota ISM Friday Weighted Average Carcass Price $129.00 $101.26 Average Weights (Estimate) Hogs 283.9 282.2 Sows 1-3 300# and up: Average Price $87.35 $66.04 Pork Loins 1/4” trimmed 13 - 19 pounds $164.02 $143.79 51-52% 185 pound Pork Carcass (5 day avg.) $130.49 $100.75 Feeder Pigs: National Direct Delivered Feeder Pigs 10 Pounds Basis - Wtd Avg. $88.73 $85.79 Feeder Pigs 40 Pounds Basis -- Wtd Avg. $127.69 $110.24 Sheep -- National Slaughter Lambs Negotiated Sales 5,400 4,500 Choice & Prime Wooled and Shorn 130-150 lbs. $154.00 No Test Iowa Large Eggs (cents per dozen) $1.44 $1.19 Young Hen Turkeys: 8 -16# - Eastern (cents/lb) 103.50 96.61 *Iowa Ethanol Prices $/gal $3.15 $2.09 Futures: Corn $4.92 $4.58 State Average Cash Corn Price $4.65 $4.43 Basis -$0.27 -$0.15 Futures: Soybean $14.36 $14.14 State Average Cash Soybean Price $13.93 $13.68 Basis: -$0.43 -$0.46 Slaughter Under Federal Inspection Estimates Estimates Hogs: 2,011,000 2,117,000 Cattle: 577,000 559,000 Sheep: 41,000 40,000 Estimated Numbers through Saturday Cash Corn and Soybean prices are the Iowa Average Prices as reported by IDALS. NA-No report at time of publication. Source: USDA Livestock and Grain Market News

number of hogs affected because a reported case can mean a single animal or an entire herd. Some industry analysts have estimated as many as 3 million to 5 million hogs could be affected.

Hay, small squares, 1st crop, $75-180; 2nd crop, $110-210; large squares, 1st crop, $130-185; 2nd crop, $120-260; 3rd crop, $125-205; 4th & 5th crop, $230-280; large rounds, 1st crop, $90-150; 2nd crop, $75240; 3rd crop, $115-180. Grass, large squares, $60-110; large rounds, $40-145. Straw, large squares, $75-130; large rounds, $40-60.

Perry**, March 22 Alfalfa, small squares, premium, $6-7; good, $4; large squares, premium, $80; good, $55; large rounds, premium, $90; good, $65.

Grass, small squares, premium, $4.50; good, $3.50; fair, $3.50; large rounds, premium, $60; good, $50; small squares, fair, $50. Straw, small squares, $3.50. Cornstalks, large rounds, $15.

Rock Valley, March 27 Alfalfa, small squares, supreme, $240; good $155; fair, $3.25; large squares, supreme, $200-215; premium, $150-175; good, $125145; large rounds, supreme, $205-215; premium, $150-175; good, $120-140; fair, $105-115. Grass, small squares, premium, $170; good, $130-140; fair, $110; large squares, utility, $85-90; large rounds, premium, $145-155; good, $110-130; fair, $85-105; utility, $7080. Mixed: large squares, good, $120-165; large rounds, good, $120-165; utility, $45-90. Straw: large squares, $105-110. Cornstalks: large rounds, $40-50.

Yoder**/Frytown, March 26 Grass, large rounds, $30-47.50; small squares, $3-4. Alfalfa, large rounds, $55-100; large squares, $45-90; small squares, $2.60-4. Cornstalks, large rounds, $27.50

$166.50 $140.00 **Perry and Yoder hay auction prices are per bale. All other prices are per ton.

$76.43 275.7 $62.46 NA $77.40

Contacts: Dyersville, 563-588-0657; Ft. Atkinson, 563-534-7513; Perry, 515-321-5765; Rock Valley, 712-476-5541; Yoder, 319-936-0126

$23.80 $56.81 7,600 $107.00 $1.13 97.50 $2.53 $6.95 $7.03 +$0.08 $14.04 $14.03 -$0.01 Actuals 2,105,000 580,000 44,000

As the weather warms up and the planting season begins, it is a good time to monitor new-crop opportunities for revenue. This week’s graph looks at projected revenues using December corn futures price since early January, less a 30-cent basis, and an anticipated yield of 180 bushels per acre. Compared to Iowa State University’s estimated costs of production of $772 per acre (dashed red line), prices have strengthened to profitable levels. Use your own estimates and costs to get your own picture of what the newcrop market is offering.


IOWA FARM BUREAU SPOKESMAN

Soybean imports from Brazil may reach U.S. shores

A

mid the focus on the pace of U.S. soybean exports and the resulting size of our March 1 soybean stocks, the situation in Brazil has been mostly ignored. But given how that situation is unfolding, it may be a case of “ignore at your

own peril.� Since the beginning of the year, the trade has scrutinized weekly reports of Chinese cancellations. Some have occurred, but not to the level that would keep ending stocks from shrinking to uncomfortably tight levels. One of the reasons may have been tied to the “strong armed� tactics U.S. exporters took with Chinese buyers. About six weeks ago, talk circulated indicating U.S. exporters wouldn’t let the Chinese out of their contracts, in part because they had already booked shipping. Meanwhile, crush margins in China have dropped to unprofitable levels, port stocks have become unduly burdensome and unloading delays have become extensive. The intransigence of our exporters, and the Chinese domestic situation, forced Chinese buyers to focus their attention on Brazil and/or Argentina. Over the last two to three weeks, there have been numerous indications Chinese buyers were altering the shipping schedule from Brazil. Initially, there was talk they had resold 10 cargoes (equivalent to 20 million bushels) of soybeans to U.S. processors. Today, it’s rumored the number could be as many as 20 cargoes. It’s rumored they have also requested shipping delay on another 20 to 30 cargoes. The 70-cent decline in the FOB basis (loaded on ship) at Paranagua, Brazil over the past four to five weeks has reflected this, substantiating talk of Chinese cancellations. Meanwhile, Brazil’s harvest is winding down and product is flowing to ports. They are on schedule to ship 6 million to 6.5 million metric tons in March, nearly double the prior record. That’s a month ahead of last year. The spread between Brazilian and U.S. prices already makes it feasible to ship their soybeans to processors at our coast. If their FOB basis drops another 15 cents, it should cover the cost of shipping to some interior processors, too. As a result, imports could be raised 10-15 million bushels on the next USDA supply/demand report, and could end up 20-25 million over the current forecast.

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7

Cash Strategist Hotline: 1-309-557-2274

CORN STRATEGY

600

0D\&RUQ

575

2013 CROP: Corn futures con-

ZLWKGD\PRYLQJDYHUDJH

550

tinue to hold key short-term support, keeping the door open for another push to a new high. Still, one cannot build a strong positive story at this time with this year’s old-crop ending stocks. Use strength to make catch-up sales. Check the hotline after the report, we could add to them at any time, especially with cycles set to bottom in late May.

Even though May futures haven't signaled a turn lower, the struggle to challenge the $5.00 mark again suggests the move up is tired. At the least, it is poised to put in a 6-7 week peak, and may be positioned to put in a 20-week top. If it does move higher in the short term, look for resistance at $5.00- $5.25 to reject rallies.

525 500 475

450

ĎŽĎŹÍ˛Ç ÄžÄžĹŹ Ä?LJÄ?ĹŻÄžĹŻĹ˝Ç Ć?

A close under $4.75 would indicate the short-term trend is turning down again.

425 400 3/28/13

6/27/13

9/26/13

12/26/13

3/28/14

6/27/14

175

2014 CROP: Leave orders to price another 10 percent if December futures hit $4.95, boosting new-crop sales to 35 percent.

FUNDAMENTALS: In the short term, this week’s USDA prospective planting and grain stocks reports will guide market direc-

150

tion. Even though planting will not start early this year, the trade doesn’t seem too anxious. Last year’s demonstration of the ability to plant a lot of acres in a week’s time has undermined that concern for now. Export sales continue strong, remaining a positive force for prices.

125 100

Basis Chicago Futures

75 50

25 0 -25 -50 -75 4/22/13

7/16/13

10/8/13

1/2/14

3/28/14

FAIL-SAFE: If December futures close under $4.78, get new-crop sales to 35 percent.

1500

SOYBEAN STRATEGY

0D\ 6R\EHDQV

1450

ZLWKGD\PRYLQJDYHUDJH

1400 1350

2013 CROP: While we can’t

7KH SHUVLVWHQWUHMHFWLRQDWRQO\UHLQIRUFHV WKHLGHDWKLVLVDWLUHGPDUNHW7KHSDWWHUQWKDW KDVEHHQEXLOGLQJRYHUWKHODVWPRQWKLVDFODVVLF WRSSLQJSDWWHUQ

1300

rule out a bullish report reaction, the decline in cash prices in Brazil relative to the U.S. indicates it may not be long lasting if one does occur. We do not recommend owning inventory.

ĚƾĞ ÄžÄ‚ĆŒĹŻÇ‡DĂLJ

1250

0D\ IXWXUHVFRXOGVWLOOKDYH RQHPRUHSXVKWRDQHZ KLJKEXWVKRXOGQ WJHWRYHU LILWGRHV%XWD FORVHXQGHUZRXOG LQGLFDWHWKHVKRUWWHUP WUHQGKDVWXUQHGORZHU

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1200 1150 3/28/13

6/27/13

9/26/13

12/26/13

2014 CROP: Use strength to

300

get sales to recommendation. November futures continue to fail as they near $12, reinforcing its strength as resistance.

200

FUNDAMENTALS: The report talk has dominated the trade for the last week, especially the expectation for tight stocks. But as we have outlined in the main

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APRIL 2, 2014

3/28/14

6/27/14

250

article, Chinese cancellations and re-sales of Brazilian contracts has made it economically feasible, or nearly so, for the U.S. to import soybeans from Brazil. Longer term, it’s important to acknowledge continued Chinese economic problems could undermine protein demand longer term.

150 100 50 0 -50 4/22/13

Basis Chicago Futures

7/16/13

10/8/13

1/2/14

3/28/14

FAIL-SAFE: Make sure newcrop sales are at recommended levels if November futures close under $11.73.

Iowa Corn & Soybean Basis

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CORN: (basis vs. May futures, 3/26/14)

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Cash Strategist Positions at a glance

CORN

2013

7-16-12 — 10% sold @ $6.35

3-10-14 — 10% sold @ $4.82 3-10-14 — 15% sold @ $4.78

4-29-13 — 10% sold @ $5.36

75% unsold

— 10% sold @ $5.33

6-3-13 — 10% sold @$5.27 2-10-14 — 10% sold @$4.42 1/4 3-10-14 — 20% sold @ $4.85 20% unsold

BEANS

2013

2014

7-11-12 — 10% sold @ $12.92

12-23-13 —10% sold @ $11.72

8-1-12 — 10% sold @ $12.90

12-31-13 — 10% sold @ $11.35

2-4-13 — 10% sold @ $13.35 4-22-13 — 10% sold @ $12.06 6-3-13 — 10% sold @ $13.25

NC $4.60 -0.25 SC $4.62 -0.23

NE $4.66 -0.19 SE $4.67 -0.18

NW $13.82 -0.58 SW $14.06 -0.34

NC $13.93 -0.47 SC $14.01 -0.39

NE $13.93 -0.47 SE $14.12 -0.28

Neither AgriVisor LLC nor the Iowa Farm Bureau Federation is liable for any damages that anyone may sustain by reason of inaccuracy or inadequacy of information provided herein, any error of judgment involving any projections, recommendation or advice or any other act of omission. This publication is owned by the Iowa Farm Bureau Federation with advice provided by and copyrighted by AgriVisor Services LLC, 1701 Towanda Avenue, Bloomington, Ill., 61701. No reproduction of any material in whole or in part of this page may be made without written consent.

2014

8-21-12 — 10% sold @ $6.50 5-13-13

NW $4.49 -0.36 SW $4.42 -0.43

SOYBEANS: (basis vs. May futures, 3/26/14)

2-18-14 — 10% sold @ $11.38 3-3-14

— 10% sold @ $11.72 60% unsold

10-28-13 — 10% sold @ $12.78 11-11-13 — 10% sold @ $13.00 12-9-13 — 10% sold @ $13.34 1-21-14 — 20% sold @ $12.99

Iowa Farm Bureau members have free 24/7 access to AgriVisor daily updates through the Members portion of the IFBF website: www. iowafarmbureau.com. The AgriVisor link is on the homepage under the Daily Market chart.

Railroad delays push ethanol prices higher Ethanol rose to its highest price since July 2006 last week as demand for the biofuel climbed while rail delays held down production rates, Bloomberg news reported. Companies face delays in transporting ethanol from the Midwest, where about 89 percent of plants are located, to the population-dense East Coast. Severe winter weather affecting tracks and increased use of train cars to ship oil and freight have meant slow response times for ethanol shipments. “It is logistics, logistics, logistics,� said Julie Ward, an assistant vice president at R.J. O’Brien & Associates, a broker in Des

Moines. “It all boils down to that. The further you have to carry it, the harder it is to get there.� Ethanol companies haven’t been able to increase production to meet higher consumption because they can’t get tank cars quickly enough, Ward said. The biofuel shortfall might last through April as plants go offline for routine maintenance ahead of the U.S. summer driving season, she said. Denatured ethanol for April delivery rose to $3.158 a gallon on the Chicago Board of Trade by mid-day on March 28, the highest intra day level since July 11, 2006. Futures have climbed 29 percent in the past year. Spot ethanol in New York

Harbor climbed 12 cents last Friday to $4.10 a gallon, up 60 percent from a year ago, according to data compiled by Bloomberg. Ethanol inventories in late March were down 10 percent from a year earlier and are at a seasonal record low, data compiled by Bloomberg show. Stocks of ethanol finally rose slightly last week, halting a five-week slide. The Rail Energy Transportation Advisory Committee, established by the U.S. Surface Transportation Board to address problems, said in a presentation last month that tank car availability for ethanol is “extremely tight due to reduced velocity.�



Stateapril22014