Monday August 11 Ag News

Settlement of Clean Water Act Violations Aims to Prevent Future Oil Spills by Cargill Inc.

Cargill Incorporated, a privately held multinational corporation headquartered in Minnetonka, Minn., has agreed to settle allegations that it violated the Clean Water Act (CWA) at two different large oil storage facilities located in Blair, Neb., and Eddyville, Iowa.

Through the settlement with EPA Region 7, Cargill will pay a civil penalty of $187,500 to the United States.

The Clean Water Act requires facilities that store large quantities of oil to develop a Facility Response Plan (FRP) that outlines procedures for addressing “worst-case” discharges of oil. By being prepared and by conducting required response drills, facilities are better situated to prevent environmental harm from such releases. Each of Cargill’s two facilities produces and stores more than 1 million gallons of oil.  Combined, the two facilities have a total estimated storage capacity of more than 7 million gallons.

“The Clean Water Act requires large oil storage facilities to have adequate response plans to prevent a spill from turning into a large scale environmental disaster,” said Karl Brooks, EPA Region 7 administrator.  “The lack of a Facility Response Plan for these facilities can have serious consequences for humans and the environment in the case of a spill.  This settlement helps protect the communities of Blair, Neb., and Eddyville, Iowa, if spills were to occur.”

EPA identified the lack of a response plan during 2013 site visits at Cargill’s facilities in Blair, Neb., and Eddyville, Iowa.  Each facility required a Facility Response Plan (FRP) because the storage capacity of its denatured ethanol tanks exceeded 1 million gallons.  As a result of the visits, in June 2014 Cargill submitted to EPA signed and effective FRPs. 

The settlement resolves the FRP violations of the CWA by Cargill.



Plan to 'Celebrate Agriculture' at Aug. 17 Lunch in Columbus

There is a Celebrate Agriculture Lunch that will be available from 11 a.m.-1 p.m. on Aug. 17 during Columbus Days. The Agri-business Committee of the Columbus Area Chamber of Commerce is sponsoring the event to celebrate local agriculture production.

Cost to have lunch is just $5 per person. Included will be a choice of meat (hamburger, hot dog or bratwurst), chips, corn on the cob, ice cream and a bottle of water. It will be served at the tent on the east side of Frankfurt Square in downtown Columbus.

The lunch also has the support and sponsorship from Daniels Produce, the Nebraska Dairy Council and our local dairy producers, the Platte Valley Cattlemen, Nebraska Farm Bureau, the Nebraska Soybean Board, Pillen Family Farms, Cargill Value-added Meats, CSS Farms and the Nebraska Pork Producers.

This is thesecond annual lunch. Last year the community served over 300, and it has the same goal again this year.

While enjoying lunch, people can also learn about the power of agriculture in Nebraska's economy from "A-FAN" and the commodity information available. In addition, a Nebraska Beef Ambassador will be present. Come celebrate local agriculture and our role in feeding the world with a great lunch at Columbus Days.



CORRECT TIMING MAKES THE BEST SILAGE
Bruce Anderson, UNL Extension Forage Specialist

Will you chop corn silage this year?  Do it right and time your harvest correctly.

High-quality corn silage often is an economical substitute for some of the grain in finishing and in dairy rations.  And corn silage can be an important winter feed for cow-calf producers.  All too often, though, we fail to harvest silage to get its best feed value.

Harvest timing is critical for success.  Timing needs to be based on moisture content of the silage.  Silage chopped too early and wetter than seventy percent moisture can run or seep and it often produces a sour, less palatable fermentation.  We often get this wet silage when we rush to salvage hail or wind damaged corn.  Live and green stalks, leaves, and husks almost always are more than eighty percent moisture so be patient and wait until these tissues start to dry before chopping.

Normal corn, though, is often chopped for silage too dry, below sixty percent moisture.  Then it's difficult to pack the silage adequately to force out air.  The silage heats, energy and protein digestibility declines, and spoilage increases.  If your silage is warm or steams during winter, it probably was too dry when chopped.

Many corn hybrids are at the ideal sixty to seventy percent moisture as corn kernels reach the one-half milkline.  This guide isn’t perfect for all hybrids, though, so check your own fields independently.

Corn kernels in silage between half milkline and black layer are more digestible.  Drier, more mature corn grain tends to pass through the animal more often without digesting unless processed.  Also, older leaves and stalks are less digestible.

So chop your silage at the proper moisture level this year.  The outcome will be better feed and better profits.



Nebraska Ag Exports to Russia Drop Significantly

Agricultural exports from Nebraska to Russia have almost disappeared in the last couple of years, according to the Nebraska Department Agriculture's tables of U.S. Census and other data.

Russia was 23rd among foreign destinations for Nebraska exports of all types in 2013, at $50 million, down from $178 million in 2012, according to U.S. Census data. Of that $50 million last year, more than $33 million was in industrial machinery, and $8 million was in metal goods.

This year, from January through June, all Nebraska agricultural exports to Russia were worth $923,000, almost all of it legumes.

In 2012, Nebraska exported $126 million in agricultural goods and products to Russia, including $96 million in meat, $27 million in live animals and about $3 million in corn and legumes, according to the Nebraska Department of Agriculture's tables. That dropped to about $2.3 million of all ag exports to Russia last year, almost all of it corn and legumes.

Meat exports have dropped precipitously because of Russia's refusal since February of 2013 to accept meat imports from animals treated with ractopamine, a feed additive used to promote lean meat production.

Nebraska's total agricultural exports in 2012 were worth $7.3 billion, fifth among the states.



Claas to Market Large Tractors in North America
Claas' long talked about entry into the North American tractor market is upon us.  The company gave media and VIP's a sneak peak at its new Xerion tractor that's designed specifically for the North American market during its Lexion Adventures in the Field event several weeks ago in Omaha. 

Claas will officially introduce the tractor to the rest of the industry later this month during the Farm Progress Show in Boone, Iowa, and later at Husker Harvest Days in Grand Island, Nebraska.

With 435-530 horsepower from MTU Mercedes-Benz engines, it would compete with U.S. favorites on tracks and tires but with a rigid 4WD drive chassis, multi-mode 4-wheel steering and stepless CVT drive.

Claas also recently opened a new company owned and operated dealership in Regina, Saskatchewan, near its newly opened Parts & Logistics Center and regional training academy.



Feedlot Profitability ...
Glynn T. Tonsor, Assoc. Prof., Dept of Ag Econ, Kansas State University

Substantial discussion within the industry and corresponding media coverage has focused on "sticker shock" some consumers may have at the beef retail counter as well as profitability of cow-calf producers and corresponding prospects for herd expansion.  What has received comparatively less attention "in the middle" of the industry supply chain, is recent and upcoming profitability prospects of the feedlot sector.

The feedlot sector has long been noted to be in an unfavorable position of having excess capacity in the face of tight and dwindling feeder cattle supplies reflective of the multi-year decline in the U.S. breeding herd.  Given this backdrop, many analysts (including yours-truly) were not anticipating 2014 to be anything feedlot producers would be excited about.  Counter to these expectations, feedlot returns so far in 2014 have been very positive.

The most recent estimates of closeouts offered in K-State's Kansas Feedlot Net Return series indicate steers sold in June at a profit of $197.44/hd.  This marks the sixth consecutive month of closeouts with profits exceeding $125/steer which is something that has never previously occurred going back to 1993 when the current K-State analysis starts.  Moreover, current projections for closeouts during the July-September period are all over $200/steer.  These positive returns essentially reflect the substantial increase in fed cattle prices relative to expectations when feeder cattle were purchased, at levels much lower than today's prices.

While this positive start to 2014 is certainly welcomed by feedlot operators, a word of caution follows current projections for animals scheduled to be sold later in the year.  As shown in table 1, net returns are expected to turn much lower and actually negative in the fourth quarter.  This sharp reversal reflects the notable increase in feeder cattle prices and the corresponding lack of further increases in expected fed cattle prices.

It is important to recognize the Kansas Feedlot Net Return series assumes a "hand-to-mouth" cash based process of procuring feeder cattle and corn as well as selling fed cattle.  That is, the calculations purposely assume no risk management, forward pricing, or other strategies are in-place for feedyards.  While this approach is used to provide a benchmark over time for profitability trends, it fails to capture notable variability in feedlot specific situations and managerial approaches.  This firm-specific variation is noteworthy as many operations likely have not realized the full magnitude of positive returns so far this year (e.g. they may have hedged fed cattle sales) or may have implemented some protection on upcoming closeouts (e.g. they may have hedged upcoming feeder cattle placements).



“Antibiotics & Stewardship” Focus of NIAA Symposium Nov. 12-14 in Atlanta, Ga.

Stewardship is the theme for the 2014 Antibiotics Symposium being hosted by the National Institute for Animal Agriculture (NIAA) Wednesday, Nov. 12-Friday, Nov. 14, 2014, in Atlanta, Ga., at the Crown Plaza Atlanta Midtown hotel. More specifically, the symposium will focus on antibiotic use and resistance, and moving forward through shared stewardship.

The Symposium is open to individuals who want to learn from each other, engage in productive discussion and create successful strategies to preserve antibiotic efficacy. Historically, the NIAA Antibiotics Symposium has brought together academia, government researchers, the scientific community and stakeholders within animal agriculture, human medicine and the environment to share and learn from each other in order to seek resolution about the often misunderstood issues of antimicrobial use and resistance.

This year will be no different, as the symposium focuses on minimizing resistance and maintaining antimicrobials important for animal and human health. Keynote speakers representing both the animal and human health communities will start by identifying and prioritizing key resistance issues at the human and animal interface, including important antibiotics that are used in both animal and human health, potential routes of transmission of human antibiotic resistance, and ways genetic components of resistance are moved around.

Next, existing animal and human health antibiotic stewardship programs will be presented, highlighting best practices for farm, small animal, human hospital and private clinic settings; focusing more attention on small animal practitioners and independent physicians; identifying gaps and weaknesses; and looking for alternative use practices in the future.

As with all goals, a means of measurement is necessary, and the symposium will address what are/should be the metrics of success of implementing antibiotic use regulations/policies. Existing metrics of success will be illustrated, followed by the identification of proposed metrics of success and recognizing a desired outcome (quantifying use vs. minimizing resistance).

An integral part of the annual NIAA Antibiotics Symposium is discussion via small breakout groups and a large group session, with the goal of identifying real-world solution strategies to move forward with minimizing resistance at the human-animal interface, and generating improved communication between stakeholders.

More information about the Antibiotics Symposium and NIAA can be found at www.animalagriculture.org. NIAA’s purpose is to provide a source for individuals, organizations and the entire animal agriculture industry to obtain information, education and solutions for challenges facing animal agriculture.



Cargill reports fourth-quarter and full-year fiscal 2014 earnings

Cargill has reported net earnings of $424 million in the fiscal 2014 fourth quarter ended May 31, down 12 percent from $483 million in the year-ago period. Fourth-quarter revenues rose 2 percent to $36.2 billion.

For the full fiscal year Cargill earned $1.87 billion, a 19 percent decrease from $2.31 billion in the prior year. Revenues declined 1 percent to $134.9 billion. Cash flow from operations totaled $3.77 billion, down 12 percent from $4.27 billion in fiscal 2013.

“Cargill plays an important role in helping to feed a growing world, and that inspires us to continuously improve performance,” said David MacLennan, Cargill’s president and chief executive officer. “Though we look back on a year in which overall earnings fell short of expectations, we realized stronger operating results in several businesses including a turnaround in our global beef operations. We also made good progress on moves designed to sharpen efficiency and support profitable growth in fiscal 2015 and beyond.”
Fourth-quarter and full-year financial summary

Among Cargill’s four segments, earnings rose significantly in Animal Nutrition & Protein in the fourth quarter and full year. Results in animal nutrition were up for the full year, reflecting the positive impact of recent years’ acquisitions and a product and service mix that met the diverse needs of customers. Fourth-quarter earnings were below the year-ago level due to a loss resulting from adjustments to the balance sheet to account for Venezuela’s effective currency exchange rates. Performance in animal protein was led by the beef business, which was boosted by increased operating efficiency, good cattle feeding results in North America and brisk exports of Australian beef. U.S. pork operations rose on improved live production and processing efficiency, and steady demand. Poultry operations in Central America, Europe and Thailand posted higher earnings in both periods on a combined basis.

Food Ingredients & Applications earnings decreased in the fourth quarter and fiscal 2014 after four consecutive years of record performance. Sweeteners and starches in North America and Europe, and cocoa and chocolate in Europe led segment performance. Results overall reflected weaker economic conditions in some countries and the negative impact of the change in Venezuela’s effective currency exchange rates.

Origination & Processing results were slightly below last year’s fourth quarter. Full-year earnings decreased moderately from fiscal 2013, reflecting in part the impact of China’s rejection of certain U.S. corn shipments, as reported in the third quarter. Fourth-quarter performance was led by supply chains in South America; full-year results were led by supply chains in Brazil, Europe and North America. U.S. farm services continued to experience limited handling and storage opportunities stemming from the last year’s drought and higher costs related to railcar shortages.

In Industrial & Financial Services, earnings rose in global ocean transportation and the U.S.-based steelmaking joint venture, but segment results declined overall in both periods due to poor performance in energy.



Smithfield Foods Profit Surges

Smithfield Foods Inc. said its second-quarter earnings more than quadrupled as demand in its hog production segment remained strong.

Smithfield was purchased last year by China's biggest pork producer WH Group, then known as Shuanghui International Holdings, for about $4.7 billion, a deal that marked the biggest Chinese takeover of an American company.

The meat producer said its most recent results benefited from its restructured and streamlined fresh pork and packaged meat operations. Beginning with the most recently ended quarter, the company's former pork unit now consists of two reportable segments: fresh pork and packaged meats.

Smithfield, the world's largest hog farmer and pork processor, reported earnings of $142.9 million, compared with $32.4 million a year earlier. Sales rose 14% to $3.8 billion.

The company said changes to the company's reportable segments had been applied retrospectively for previous periods. The new packaged meats segment, the largest contributor to Smithfield's revenue, increased to $1.73 billion from $1.45 billion a year earlier. Fresh pork sales increased to $1.61 billion from $1.32 billion in the year-prior period.

Hog production revenue remained virtually flat at $857 million, but operating profits in the segment soared as margins improved and prices surged 30%.