Thursday October 10 Ag News

Recent Rains, Snow is Good News for Drought

            Recent rains and even snow storms in the western part of the state are helping to recharge soil moisture, the University of Nebraska-Lincoln state climatologist says.

            Last week's two-day precipitation event gave many areas of the state a month's worth of precipitation. Average rainfall for October varies across the state between 1.75 to 2.55 inches, said Al Dutcher, state climatologist in the university's Institute of Agriculture and Natural Resources. Some areas of the state saw well over that amount.

            "At most of our long-term stations, the wettest October on record is between 6 and 7 inches of precipitation," Dutcher said. With 20 plus days of October remaining and another two to three precipitation events, this October could be one of the top 10 wettest on record even with moderate events.

            Another system is already setting up for the end of this week, he said, and it appears weather patterns could remain active.

            While this does slow harvest across the state, most fields should dry out in a few days since much of the moisture is getting into the ground as conditions have been dry. In addition, this is beneficial for the state's newly planted winter wheat crop.

            "Compared to last year, we are ahead of schedule," he said. "This gets our surfaces wetted up, and we are off to a decent start for the soil moisture profile. However, on the flip side, there still are drought concerns to deal with. West central and southwest Nebraska missed out on this precipitation."

            Also, while there will be improvements in the drought, they will not be as dramatic as one might think.

            The heaviest precipitation fell in the Blue River basin, which is having minor low-land flooding. This is important as there have been water restrictions in that area.

            "While this event may not a significant impact on the water tables, it does have the potential to aid things. These precipitation events will be most important for improving stock ponds. The next step will be groundwater tables, which have seen dramatic declines during the drought," Dutcher said.

            He said while this fall seems to be active, many people might think this a prelude to an early winter.

            "What I can tell you is we have started out some winters with a big snow storm and have nothing again; other times we have started out strong and remain strong," Dutcher said. "It really is hard to determine. But if we continue to have systems move through at a regular frequency, things do seem to be setting up to be more active."



Nebraska’s Pork Producers & Operation BBQ Relief Reach Out to Community Hit by Tornado

The Nebraska Pork Producers Association is assisting Operation BBQ Relief (www.operationbbqrelief.org) in their effort to provide meals for those affected by the F4 tornado that devastated parts of the Wayne, Nebraska community on October 4, 2013.

Volunteers from Operation BBQ Relief will arrive on Friday to smoke pork shoulder through the night and will begin serving between 11 a.m. and noon on Saturday at the Journey Christian Church, 1110 E 7th St, Wayne. Nebraska’s pork producers are donating 500 pounds of pork shoulder for the barbecue meals. “It’s awesome that Nebraska’s pork producers and others can quickly respond to our neighbors in need,” said Shane Meyer, President of the Nebraska Pork Producers Association. It is estimated that a thousand people will be served.

During 2012, Operation BBQ Relief cooked almost 182,000 meals in 11 states and spent 52 days cooking. Since the first disaster they cooked for in Joplin, MO, Operation BBQ Relief volunteers have served 470,900 meals to victims and first responders. Operation BBQ Relief is a not-for-profit corporation registered in all fifty states and ready to respond to natural disaster emergencies across the United States.  



NE-SD Cattle Relief Efforts Launched
(NE Cattlemen)
By now, most people are aware of last week’s serve winter storm that caused extreme cattle losses to producers in north west Nebraska, South Dakota, and Wyoming. A winter storm producing rain followed by several inches of heavy snow and severe wind has caused catastrophic cattle losses to many producers in Sioux, Dawes and Sheridan counties. Recovery efforts are underway in these counties but there have been no official count of losses, but we do know that the loss of head is devastating to many cattle producers.

If you would like to help producers in Nebraska, a contribution can be sent to the Cattlemen Relief Fund, PO Box 1125, Chadron NE 69337.

Also, the South Dakota Rancher Relief Fund was established in South Dakota to provide support and relief assistance for South Dakota livestock producers. To donate visit, https://www.giveblackhills.org/27677.



2013 AgRelations Council Banquet, Conference Set

The Nebraska AgRelations Council will honor Jerry Werner during its awards banquet Nov. 6 beginning at 6:15 p.m. at the University of Nebraska-LIncoln East Campus.

The banquet is part of the Ag at the Crossroads Conference taking place Nov. 7 at the Lancaster Event Center from 8 a.m. to 4 p.m.

Cost for the Awards Banquet is $25; after Nov. 1 it is $30. Cost for the Ag at the Crossroads is $40; after Nov. 1 it is $45. Cost for both the Awards Banquet and Ag at the Crossroads is $65; after Nov. 1 it is $75.

A block of rooms has been reserved at the Hampton Inn at 27th Street and I-80 on Nov. 6. To reserve a room, call 402-435-4600 before Oct. 13 and ask for the Ag at the Crossroads conference rate.

For Registration and Event questions or problems please contact Sandy Sterkel at 800-535-3456, Mon.-Fri. 8:30 a.m.-4:30 p.m. Central Time or email ssterkel1@unl.edu.



Pasture, Rangeland and Forage Insurance is a Risk Management Tool for 2014

            The deadline for Pasture, Rangeland and Forage insurance coverage for 2014 is Nov. 15, and University of Nebraska-Lincoln Extension educators are encouraging producers to consider this program if they've lost forage production due to drought.

            This year was the first year PRF insurance in Nebraska used the "rainfall index" system, and it will be used again in 2014. The model is based on precipitation data collected by NOAA's Climate Prediction Center. The index reflects how much precipitation is received relative to the long-term average for a specified grid area during a given two-month time frame.

            Insurance premiums and indemnities are based on the level of coverage (70 to 90 percent) and level of production (60 to 150 percent) insured.  Premiums are subsidized from 51 to 59 percent by the federal government, depending on the level of coverage.

            Extension educator Monte Vandeveer said producers can insure their land for either grazing or for haying. For land that is insured for haying, forage production must come from perennial forages such as grass or alfalfa.  Annual forages are not eligible under this program.

            Producers using this insurance will need to choose which time periods throughout the year that they want to insure, Vandeveer said. More information and a decision support tool is available at http://www.rma.usda.gov/policies/pasturerangeforage/. 

            Using the online support tools, producers can identify the grid area for their land.   Rainfall index data are available going back to 1948 for each grid area, and producers can evaluate how different coverage options would have performed in any particular year for each grid.

            Producers should consider several issues as they evaluate using PRF as a possible risk management tool, Vandeveer said.

            – Insuring time periods which have the greatest impact on forage production is the best approach for reducing potential drought impact. Research indicates that precipitation from April through July accounts for a majority of the variation in forage production in Nebraska.

            – Because the rainfall index is calculated using precipitation data from NOAA weather stations, the rainfall index for a producer's grid area may not exactly reflect a producer's own rainfall experience.  As a result, the rainfall index may not precisely reflect changes in forage production.  Over the long term these differences should even out, but there may be discrepancies in any particular year.

            – This insurance product is best used over the long term where a producer participates every year and doesn't try to outguess what the next year will bring. Taking the premium subsidies into account, producers should more than recover their premiums if they participate over a period of many years.

            For more information, a UNL Extension NebGuide "Pasture, Rangeland, and Forage Insurance: A Risk Management Tool for Hay and Livestock Producers" is available at the UNL Extension Publication website: http://www.ianrpubs.unl.edu/sendIt/g2217.pdf.

            UNL Extension Educator Aaron Berger also has produced a webinar titled, "Pasture Rangeland and Forage Insurance in Nebraska" (https://connect.unl.edu/p1sv93lws5l/) that explains how the product works and how it can be used in Nebraska.  The webinar also is available through beef.unl.edu.

            The deadline for participating in the PRF Insurance program for 2014 is Nov.15.  PRF is sold through local crop insurance agents, just like traditional crop insurance. If you cannot find a local agent who handles PRF, RMA's Agent Locator, found online at www3.rma.usda.gov/tools/agents/‎, provides a search for other agents.



Sen. Grassley Aims to Tighten Farm Payment Loopholes

Senator Chuck Grassley of Iowa released a Government Accountability Office report which he claims shows that additional changes are needed to the eligibility requirements for being "actively involved" in farming. The GAO also wrote in the report that the legislative language in the Senate passed farm bill would be an appropriate fix to the agency's findings.

"The report shows that there is still far too much subterfuge of the actively engaged law. For instance, taxpayers are footing the bill for farm payments to 11 active managers of one farm, who supposedly provide significant management experience, yet perform no labor," Grassley said. "The loophole has been allowed to stand for too long. It's time to close it once and for all and put the issue to rest so we can maintain a safety net for the farmers who really need it."

Grassley said that the conferees to the farm bill should take notice of the report and take a hands off approach to the provisions in both the House and Senate bills

The report reviewed the Farm Service Agency's compliance reviews of farming operation members' claimed contributions of active personal management and personal labor. The GAO report also examines the Farm Service Agency's state offices' timeliness in completing and reporting compliance reviews and the results.

Specifically, GAO recommended, "Congress should consider modifying the definition of significant contributions of management activities, either as it did in recent deliberations on reauthorizing the farm bill or in other ways designed to make contributions more clear and objective."

The legislative language in the farm bill mirrors Grassley's Farm Program Integrity Act of 2013. The bill would define clearly the scope of people who are able to qualify as actively engaged by only providing management for the farming operation.



In the Cattle Markets:  Government Shutdown
John D. Anderson, Deputy Chief Economist, American Farm Bureau Federation

In normal times, participants in commodity markets are faced with an embarrassment of riches when it comes to market data. Particularly since the advent of mandatory price reporting, the coverage provided by public reporting on prices and volumes in the livestock sector has been impressive. It has also been quite easy to take for granted. Daily - and on some items (e.g., slaughter cattle and boxed beef) twice daily - reports have for over a decade now been available at the click of a mouse. This data has been more than just a convenience. Market institutions of considerable importance have built up around the availability of the data. The cash settlement of Lean Hog and Feeder Cattle futures contracts against cash market indices constructed from Agricultural Marketing Service (AMS) data are a couple of examples of such institutional arrangements. Formula price contracts, a staple in both the hog and fed cattle markets, also depend on timely, transparent information to provide inputs into price formulas.

In the absence of AMS price/quantity data, alternatives will have to be found. Private sources do exist. By all accounts, the Yellow Sheet from Urner-Barry has gained a fair number of subscribers over the past week. How good of a substitute for USDA data are such private data sources for cattle and hog prices? We are in the midst of a natural experiment that will surely tell us quite a bit about that.

Within USDA, the shutdown is affecting more than just AMS market reports, of course. Earlier this week, it was announced that the October supply and demand estimates report would be a casualty of the shutdown. The October report is generally one of the most closely watched monthly updates because it incorporates acreage information from FSA and so generally represents a more definitive figure for acreage of the major crops than prior reports. As usual, private firms have put out their own pre-report estimates in advance of the report. This year, it looks like the pre-reports will have to suffice as a proxy for an official report - at least for the time being.

Compared to last month's report, the trade expects harvested acreage to be reduced a bit but for yield to be increased slightly on both crops. On balance, corn production is reduced slightly (about 40 million bushels) from last month while soybean production is about even with last month's estimate. Expectations for ending stocks on both crops are modestly higher than last month's USDA figure, reflecting the latest stocks data - released just before the shutdown on September 30.

Looking ahead, other reports will clearly be delayed or cancelled as a consequence of the shutdown. Weekly Broiler Hatchery reports have already been interrupted. Other monthly reports are also questionable. For example, surveys required to compile the monthly Cattle on Feed report will have to be performed soon (very soon) if that report is to be completed on schedule. Those surveys will not be done during the shutdown. There is a legitimate debate to be had about the size and scope of federal government spending. That debate has taken a decidedly contentious turn with the current government shutdown. Unfortunately, commodity market transparency is quickly becoming collateral damage in the process.



New Analysis Affirms Scientific Foundation for E15

After carefully reviewing 43 studies on the effects of E15 on engine durability, emissions, and other factors, the National Renewable Energy Laboratory (NREL) issued a report finding that the available literature “…did not show meaningful differences between E15 and E10 in any performance category.” With respect to the Coordinating Research Council’s (CRC) controversial engine durability study, NREL found “…the conclusion that engines will experience mechanical engine failure when operating on E15 is not supported by the data.”

The objective of the NREL review was to assess the research conducted to date applicable to the effects of E15 use in model year 2001 and newer vehicles, including the aspects that were not a part of EPA’s considerations when approving E15. Specifically, NREL reviewed 33 unique research studies, as well as 10 related reviews, studies of methodology, or duplicate presentations of the same research data. Further underscoring EPA approval of the safety and efficacy of E15, NREL experts found that 2001 and newer vehicles are well equipped to adapt to the ethanol content in both E10 and E15. The engine performance and durability expectations from the materials compatibility and emissions test results (for E15) are confirmed by studies of fuel system, engine and whole vehicle durability. The fact that there are 33 unique studies focused on materials compatibility, engine and fuel system durability, exhaust emissions, catalyst durability, effects on on-board diagnostics and evaporative emissions seems lost on the emphasis placed on one refuted study.

According to Bob Dinneen, President and CEO of the Renewable Fuels Association, “The disputed CRC engine durability study has been at the center of Big Oil’s political crusade against E15, and policymakers have been given the false impression that the CRC project is the one and only study that has been conducted on E15. Nothing could be further from the truth. The NREL report reflects a substantial review of literature on E15 research showing no meaningful concern with using the fuel and exposes the many methodological shortcomings of studies API is citing on engine durability.”

Dinneen continued, “It’s time for Big Oil to stop using actors to scare people about E15. It’s time they start paying attention to the overwhelming data and real world experience demonstrating the efficacy of E15.” The NREL report identified numerous flaws and gaps in several of the studies reviewed. For the CRC engine durability study these include:
-    Faulty leakdown failure criteria. Most of the “failures” on E15 and E20 were related to engines that did not pass an arbitrary cylinder “leakdown” test. While other tests in the CRC study used established standards from OEMs and EPA, the leakdown test utilized arbitrary criteria with no scientific basis. According to NREL, “CRC selected a 10% leakdown failure limit, more restrictive (50% below) than that of the lowest value specified by OEMs for engines in the study.”
-    Failure to use E10 as a control fuel. Engines that “failed” on E20 or E15 were subsequently tested on E0, but not on E10 (despite the fact that E10 is the predominant in-use fuel today). This approach presumes that failures were related to ethanol content, rather than any number of other factors that could have caused the failure.
-    Inappropriate statistical analysis. The CRC study used assumed values (i.e., “dummy data”) for vehicles that were not actually tested. These dummy values demonstrated consistent bias in relation to the question that the analysis was intended to determine.

“By critically examining the universe of studies on mid-level ethanol blends, the NREL report brings important context and scientific credibility back to the debate over E15,” Dinneen said. “In addition to providing an appreciation for the entire body of scientific work on E15, the report will undoubtedly assist policymakers and the public in recognizing the substantial body of research that has been conducted on E15 showing no evidence of deterioration in engine durability or maintenance issues.”



South Korea Halts TX Plant Beef Imports

A Texas plant operated by Brazilian meatpacker JBS SA has been deemed ineligible for export to South Korea, after the country found a banned feed additive in meat supplied by the facility.

The ban prohibits beef and beef products processed by a facility in Cactus, Texas that belongs to Swift Beef Company -- a subsidiary of JBS SA's U.S. arm JBS USA -- which were loaded on board ships on or after Oct. 9 from entering South Korea. The U.S. Department of Agriculture's Food Safety and Inspection Service updated the export requirements for Korea to reflect the change Thursday.

A probe on Sept. 24 found zilpaterol, a controversial feed ingredient known by the brand name Zilmax, in 22 tons of beef imported by Swift Beef Co., South Korea's Ministry of Food and Drug Safety said Wednesday.

Ha Tae-eun, an official with South Korea's food ministry, said it would conduct tests on other U.S. beef imports "on a random basis and expand checks to meat from all U.S. beef-processing sites if we find more zilpaterol."

South Korea accounts for about 11% of U.S. beef exports, according to data from the U.S. Meat Export Federation, an industry group.

The discovery comes after Merck & Co. (MRK), the maker of Zilmax, suspended sales of the feed additive in the U.S. and Canada in August amid animal-welfare concerns. Merck said it would halt sales until it completed an investigation into whether Zilmax was the cause of lameness and immobility that Tyson Foods Inc. (TSN) and other meatpackers suspected could be associated with the drug. Tyson said during the summer that it would stop buying cattle fed with Zilmax effective Sept. 6.

Because the drug is being phased out of use in the U.S., industry watchers said they're not concerned the event will have a lasting impact on beef exports to South Korea.



Strategie Revises Wheat Forecast

Strategie Grains Thursday lowered its estimate of the European Union's 2013-14 soft wheat harvest by 0.3 million metric tons to 135.2 million tons, mainly due to lower acreage in Belgium, France, Spain and Austria.

"Black Sea wheat (from Russia and Ukraine) gained in competitiveness since last month, but not enough for us to increase our estimate of soft wheat imports from the EU. Black Sea wheat is now at price parity with French and U.K. wheat in southern EU countries," said the grains body.

Strategie Grains increased its estimate of the 28-member EU's 2013-14 corn production by 0.9 million tons to 64.9 million tons, after increasing its harvest estimates for Hungary, Poland and Bulgaria.

"Imports from third countries climb by 0.3 [million tons] over last month, to 9.6 [million tons]. That is the result of a drop in the competitiveness of French corn in relation to the other EU countries, of Ukrainian corn maintaining healthy competitiveness in the EU and of an increased demand for corn in animal feeds," said the forecaster.



Novus International Celebrates World Egg Day

Friday, October 11th is World Egg Day and Novus will once again join in this annual celebration of eggs, sponsoring events all around the world that are designed to promote the health and nutritional benefits of eggs. The celebration of World Egg Day aligns perfectly with Novus's vision to help feed the world affordable, wholesome food and achieve a higher quality of life.

"We look forward to this annual opportunity to work with the International Egg Commission, as well as egg producers and organizations on both a local and global level, to promote the positive benefits that eggs have to offer," notes Michael Whitmer, Poultry Marketing Manager at Novus. "Eggs are the most affordable, protein-rich and efficient source of nutrition available and World Egg Day provides the perfect forum to promote this important message."