Friday, July 27, 2012

Friday July 27 Ag News

Drought Map Shows Intensification in Nebraska, Central U.S.

It's official: Part of central Nebraska now is experiencing the state's first exceptional drought -- the most intense level -- in eight years, according to the National Drought Mitigation Center.

The center, headquartered at the University of Nebraska-Lincoln, reported findings in this week's U.S. Drought Monitor, its weekly report on drought conditions, which was released Thursday (July 26).

"The extreme drought in the central part of the state last week was intensified to exceptional on this map, and there was a broad intensification from severe to extreme drought in the state," said Brian Fuchs, a climatologist and U.S. Drought Monitor author.

Fuchs said the intense drought has come on fairly quickly. "In eight weeks, we went from being in fairly good condition to having the whole state in severe drought or worse."

Nebraska is not alone. This week's Drought Monitor set a record for the fourth straight week for the area in moderate drought or worse in the 12-year history of the map and showed widespread intensification of drought.

This week's map shows 53.44 percent of the United States and Puerto Rico in moderate drought or worse, up from 53.17 percent the week before; 38.11 percent in severe drought or worse, compared with 35.32 a week earlier; 17.2 percent in extreme drought or worse, compared with 11.32 percent; and 1.99 percent in exceptional drought, up from .83 percent.

"We've seen tremendous intensification of drought through Illinois, Iowa, Missouri, Indiana, Arkansas, Kansas and Nebraska, and into part of Wyoming and South Dakota in the last week," Fuchs said. "The amount of D3 (extreme drought) developing in the country has increased quite a bit for each of the last several weeks."

Fuchs also noted that as of this week, every state in the country had at least a small area shown as abnormally dry or worse. "It's such a broad footprint," he said.

"This drought is two-pronged," Fuchs said. "Not only the dryness but the heat is playing a big and important role. Even areas that have picked up rain are still suffering because of the heat."

The forecast for most of the drought-affected area is for drought to continue to develop and intensify. "Conditions are likely to persist," Fuchs said. "We'll see further development and intensification into the fall." Fuchs based his assessment on the Seasonal Drought Outlook released July 19.

Although the Drought Monitor has only a 12-year history, experts can put the 2012 drought into historical context by using the older Palmer Drought Severity Index, which has data back to 1895. By that measure, only droughts in 1934, 1939 and 1954 covered a larger area in the U.S.

The U.S. Department of Agriculture's Economic Research Service this week reported that almost 40 percent of the country's agricultural land is in severe or worse drought. It is affecting 62 percent of farms, and about 88 percent of the corn crop and 73 percent of cattle areas.

The U.S. Drought Monitor map is jointly produced by the National Drought Mitigation Center at UNL, the National Oceanic and Atmospheric Administration, the U.S. Department of Agriculture, and about 350 drought observers across the country. It is released each Thursday based on data through the previous Tuesday.

Drought Monitor authors synthesize many drought indicators into a single map that identifies areas of the country that are abnormally dry (D0), in moderate drought (D1), in severe drought (D2), extreme drought (D3) and exceptional drought (D4).

Statistics for the percentage area in each category of drought are automatically added to the U.S. Drought Monitor website each week for the entire country and Puerto Rico, for the 48 contiguous states, for each climate region, and for individual states. The National Climatic Data Center maintains drought data based on the Palmer Drought Severity Index, calculated to the beginning of the historic record. More links: U.S. Drought Monitor: and Seasonal Drought Outlook:

Trade Mission to China

Nebraska Governor Dave Heineman

International business is increasingly important and beneficial to Nebraska’s economic strength. Global trade and investment generates in excess of 56,000 jobs and more than $9 billion in new money here each year.

During the last four years, Nebraska recorded 29 international investments from 12 countries. These investments totaled more than $4.17 billion and created more than 1,400 jobs in the state. Exports from Nebraska also have increased rapidly. In 2011, we exported $7.5 billion, a 30% increase from 2010.

To help expand Nebraska’s trade efforts, I will be leading an upcoming trade mission to China. Joining me will be 35 business and industry leaders, including Catherine Lang, Director of the Nebraska Department of Economic Development, economic development professionals and representatives from the University of Nebraska.

China is a logical choice for this next mission. China has been the second most active foreign investor during the past three years with six new investments in Nebraska. In addition, China is Nebraska’s fourth largest trading partner and one of the state’s fastest growing markets, having more than doubled during the past five years with a 36% increase in 2011.  Combined exports totaled more than $380 million last year, up from nearly $279 million in 2010.

Export product areas are diverse and include: automotive machinery manufacture, medical equipment and supplies, educational materials, processed foods, water purification systems, lawn maintenance equipment, sporting goods, electronic equipment, transportation equipment, and grain handling and storage equipment. 

The trade mission will include stops in Beijing, Xi’an and Shanghai, China. This will mark the 11th trade mission undertaken by my administration.

We plan to meet with many company officials who have attended our previous two Reverse Trade Missions. In 2008, I hosted Nebraska’s first ever Reverse Trade Mission, where we had 140 international attendees, with approximately 60 from China. This last September, I hosted the state’s second Reverse Trade Mission, which had 115 attendees, with approximately 50 from China.

Our goal is to generate new markets for many Nebraska products and our hope is to attract Chinese companies that want to expand into the American market, especially those interested in doing business in Nebraska.

This trade mission represents an important opportunity to explore business development efforts that will benefit communities here at home for years to come. We want to make this trip a success for all those involved, and I look forward to leading a delegation that includes a wide variety of interests here in Nebraska.

Johanns Commends Steps to Reopen Taiwan Markets to U.S. Beef

U.S. Sen. Mike Johanns (R-Neb.) today issued the following statement after speaking with Taiwanese Ambassador Yuan about his country's actions to open their markets to American beef:

"Nebraska's cattle industry produces some of the highest quality beef in the world," Johanns said. "Taiwan's legislature should be commended for taking a first step to reopening their markets to U.S. beef. I encourage them to keep this process moving without any unnecessary delays.

"I look forward to seeing the first shipment of Nebraska beef arriving on their shores very soon and hope this science-based approach will continue to be the norm."
In 2010, the U.S. exported nearly 39,000 metric tons of beef and beef variety meats to Taiwan valued at $216.3 million.  Taiwan effectively closed their market to U.S. beef in January 2011 after implementing a zero-tolerance policy for ractopamine, a feed additive commonly used to increase the efficiency of livestock production.

Johanns met with the Taiwanese ambassador regarding this issue in March 2011 and wrote to express concern in April 2011. On Wednesday, the Taiwanese legislature amended their food  sanitation law to authorize the executive branch to bring minimum standards for ractopamine in line with those of more than two dozen nations, including the U.S.

Johanns hopes this policy will be applied to all imported meats, not just beef imports.

Informa Cuts 2012 Grain Estimates

Private analytical firm Informa Economics on Friday became the latest crop forecaster to cut its outlook for the 2012 U.S. corn and soybean harvests due to poor weather, according to traders.

Informa's downward adjustment in corn and soybean production levels is based on the assumption that August will continue the stressful weather experienced thus far in the 2012 growing season.

The data were released as a special update on U.S. corn and soybeans assuming unfavorable August weather. Informa will release its normal August production report based on surveys on Aug. 3.

Informa lowered its estimate for the U.S. corn harvest to 11.475 billion bushels from its early-July estimate of 12.49 billion bushels, traders said. The firm cut its yield estimate for the crop to 134 bushels an acre from its previous estimate of 142.5 bushels an acre, they said.

"The stressful weather pattern the U.S. is experiencing has been reducing crop prospects on a daily basis," Informa said in the report.

Grain users are uncertain about the size of the upcoming autumn harvests after intense heat stressed the crops. Farmers need to harvest a big corn crop to replenish low inventories.

Informa lowered its estimate for the soybean harvest to 2.890 billion bushels from 3.012 billion bushels, traders said. It pegged the average yield at 38.5 bushels an acre, compared to its early-July estimate of 40 bushels per acre.

By contrast, the U.S. Department of Agriculture in July estimated the U.S. corn crop at 12.970 billion bushels, using a 146 bushel-an-acre yield, and soybean output at 3.050 billion, using a 40.5 bushel-an-acre yield. The USDA is scheduled to release updated figures Aug. 10.

IGC Cuts US 2012-13 Soybean Output

International Grains Council has slashed its U.S. soybeans output forecast for 2012-13 by 9.5% to a five-year low of 79 million tons as a severe drought is wilting the crops in the Midwest.  Production was estimated at 83.2 million tons in 2011-12 and is projected to fall for the third successive year.

IGC also cautioned that there is potential for further reduction if the weather conditions don't improve soon.  With crops now entering their crucial pod-filling stage, persistent hot and dry weather across much of the Midwest has significantly impacted yield potential, IGC said in its monthly report.  Less than a third of the U.S. soybean crop is in good condition, IGC said citing official government reports.

IGC also lowered U.S. soybean exports forecast for 2012-13 by 12% to 35.5 million tons. Brazil is likely to be world's top soybean exporter, pushing U.S. to the second place.  Brazil may get the top position this year itself as shipments are already up 40% on year during the October-June period.

IGC slashed U.S. soymeal export forecast by 8% to 7 million tons.  Due to lesser U.S. output, IGC also slashed global output forecast for 2012-13 by 3% to 259 million tons. However, at these levels, global soybeans production will still be 9% higher on year, if weather turns favorable in South America after the recent drought.  Output is lower in the U.S. at a time when demand is increasing and global trade is forecast to rise 4% to a record 94.7 million tons.

China with more than 60% share in global trade is driving up demand and imports are likely to rise 4% to a record 59 million tons.  Relatively strong economic growth, and an associated change in dietary patterns towards greater protein content, is giving a push to Chinese demand for animal feed and vegetable oils, IGC said.  Demand from countries such as China amid tight supply is pushing up prices. Near-month soybeans for August delivery on the Chicago Board of Trade hit a record high of $17.7775 a bushel on July 20.

On the positive side, the surge in global prices will likely spur larger plantings in South America and coupled with a return to at least average yields, production in the region is expected to rebound, by at least one-fifth, to around 140 million tons in 2012-13, IGC said.

Global soymeal trade is likely to be little changed on year around 57.5 million tons. Imports by the European Union, world's top importer are forecast unchanged at 22.7 million tons but much lower than 2007-08 record of 25.4 million tons.

IGC Cuts Russian 2012-13 Wheat Output

The International Grains Council Friday lowered Russia's wheat output forecast for the 2012-13 aggregate marketing year by 8.2% to 45 million metric tons.  Production is now expected to fall 20% but will still be higher than 41.5 million tons in 2010-11, when a fierce drought prompted a ban on exports, IGC said.

IGC also slashed Russia's wheat export forecast to 9 million tons. This figure is 59% lower than the 2011-12 actual exports of 22 million tons.  Traders are worried that Russia may impose restrictions on exports again or ban them altogether. There aren't any firm price offers for September shipment due to policy uncertainties, a trader in Lausanne said.

The Russian government plans to review the situation Aug. 8.

Vilsack Announces Support for Producers to Grow Renewable Feedstocks for Advanced Biofuels

Agriculture Secretary Tom Vilsack today announced payments for 125 advanced Biofuel producers across the country to support the production and expansion of advanced biofuels from a wide variety of non-food sources, including waste products.

"Advanced biofuels are a key component of President Obama's 'all-of-the-above' energy strategy to reduce the Nation's reliance on foreign oil and take control of America's energy future," said Vilsack. "These payments represent help spur an alternative fuels industry using renewable feedstocks grown in America, broadening the range of feedstock options available to biofuels producers, helping to create an economy built to last."

The funding is being provided through USDA's Bioenergy Program for Advanced Biofuels, which was established in the 2008 Farm Bill. Under this program, payments are made to eligible producers based on the amount of biofuels a recipient produces from renewable biomass, other than corn kernel starch. Examples of eligible feedstocks include but are not limited to: crop residue; animal, food and yard waste material; vegetable oil; and animal fat. Through this and other programs, USDA is working to support the research, investment and infrastructure necessary to build a biofuels industry that creates jobs and broadens the range of feedstocks used to produce renewable fuel.

For example, in Somerset, Ky., Somerset Hardwood Flooring will receive a $7,040 payment for producing wood pellets from residual sawdust from its hardwood flooring manufacturing process. The company produces about 40 tons of wood pellets annually. FPE Renewables, LLC, based in Lyden, Wash., generates nearly two million kilowatt hours of electricity annually. The firm will receive a payment of $9,612 for producing biogas primarily from dairy waste, which is converted to electricity. In West Point, Va., Virginia Biodiesel Refinery, LLC, will receive a payment of $7,900 for making biodiesel from recycled cooking oil and soybean oil.

Increased biofuel production plays a relatively minor role in retail food price changes because the growing diversity of feedstock used to produce biodiesel allows for flexibility and helps relieve market pressures. Biodiesel is made from an increasingly diverse mix of non-food feedstocks, including recycled cooking oil, agricultural oils and animal fats, allowing most biodiesel producers to select from a choice of feedstocks if prices rise or supplies are limited. Therefore, the industry's impact in commodity markets is significantly reduced. As the market expands for home-grown renewable energy, American farmers and producers will create even more good-paying jobs that can't be exported. The biofuels industry in the U.S. currently employs about 400,000 people and is expected to employ around a million people in the U.S. by 2022.

USDA today is announcing $19.4 million in payments to 125 local producers and business-owners. Below is a complete list of the 111 producers (by state) receiving payments of more than $500 for production of advanced biofuels. (Producers receiving payments in the amount of $500 or less are not included in the list.)


-    Clinton County Bio Energy, LLC: $64,382 for biofuel from waste products
-    Iowa Renewable Energy, LLC: $135,510 for biofuel from waste products
-    Renewable Energy Group, Inc.: $873,622 for biodiesel transesterification
-    Western Dubuque Biodiesel, LLC: $287,034 for biodiesel transesterification
-    Western Iowa Energy: $250,277 for biofuel from waste products


-    Ag Processing, Inc.: $313,119 for biodiesel transesterification

Farm Service Agency Announces Continuous Sign-up for CRP Highly Erodible Land Initiative

Continuous sign-up for the Highly Erodible Land (HEL) Initiative under the Conservation Reserve Program (CRP) started on July 23, 2012.  Nebraska received a total allocation of 42,300 acres to enroll in the HEL CRP program.  Offers will be accepted until either the state acreage allocation limit is reached or September 30, 2012 (whichever occurs first).

“CRP is a voluntary program that has protected environmentally sensitive land for more than 25 years,” said Josie Waterbury, Executive Director for the Thurston County Farm Service Agency.  “This initiative will accept offers with an erosion rate of at least 20 tons per acre per year for new cropland or CRP acres that expire on September 30, 2012; however, existing grass stands that are not considered expiring CRP will not be considered eligible," she said.

Producers can stop by their local FSA Office to determine if their land qualifies for the Highly Erodible Land Initiative and to receive additional location-specific details.

Landowners enrolled in CRP receive annual rental payments and cost-share assistance to establish long-term, resource conserving covers on eligible farmland.  Incentive payments are not authorized under this initiative.

New land contracts approved during this continuous sign-up initiative will become effective the first day of the month following the month of approval and are valid for 10 years.

CRP contracts set to expire on September 30, 2012, may be offered for consideration and approved contracts will become effective October 1, 2012, and are also valid for 10 years.

Branstad Issues Disaster Emergency to Assist Producers

Thursday, Iowa Gov. Branstad issued a disaster emergency proclamation that will provide relief to Iowa farmers hit hard by the drought being experienced in the state.

This proclamation takes affect at noon today for the next 60 days. The assistance comes in the form of a suspension of state laws and regulations affecting the transport of hay, straw and stover. The drought has destroyed or depleted sources of these products that are necessary for livestock production and feed.

Specifically, this proclamation allows for:
-- Overweight loads: Hay, straw and stover may be transported in loads weighing up to 90,000 pounds gross weight without obtaining an overweight permit normally required by the Iowa Department of Transportation. Overweight loads cannot travel on the interstate without a permit. This proclamation applies to noninterstate roadways. Specific axle weight limits do apply. Visit the Iowa DOT's website to see the maximum gross weight table and determine the legal limits for your vehicle/trailer combination. A vehicle that is overweight, but not overwidth, can travel at all hours.

-- Overwidth loads: A vehicle transporting these goods can be overwidth, without an Iowa DOT permit, if they do not exceed 12 feet 5 inches wide. An overwidth load can travel on any road, including the interstate, as long as its gross weight does not exceed 80,000 pounds. Movement must occur between the hours of 30 minutes before sunrise and 30 minutes after sunset. All flags, signs and lights normally required are still needed.

-- Overweight and overwidth loads: A vehicle transporting these goods can be both overwidth, up to 12 feet 5 inches, and overweight, up to 90,000 pounds. However, these vehicles cannot travel on the interstate.

-- Driver hours of service: The driver hours-of-service regulations pertaining to persons transporting these specific agricultural goods are suspended. Certain rest periods must be provided to drivers to prevent fatigued or ill drivers from operating on the roadways.

For additional details, call 1-800-925-6469 or visit the Iowa DOT's website at where a question and answer sheet can be found.

Despite Extreme Weather, Soy Demand Expected to Remain Strong

The 2012 growing season got off to a fast start for many U.S. soybean farmers due to warm, dry weather conditions – conditions that continue throughout many critical growing areas of the United States.

Northwest Iowa farmer Jim Stillman, who serves as vice chair of the United Soybean Board (USB), hopes, along with other soy checkoff farmer-directors, that conditions improve so they have a big harvest that can help meet strong global demand for U.S. soy.

"We started out dry, had a little rainy period, which delayed us a little bit, but right now, many of us need rain," Stillman says.

National Weather Service data shows parts of the two biggest U.S. soybean-producing states, including Stillman’s home state and neighboring Illinois, have experienced less than half of the precipitation they normally receive by this time of the year.

"Demand for soybeans right now is great," says Stillman. "China and other countries want to buy, and our biggest customers here in the United States continue to feed a lot of poultry and hogs."

At USB’s meeting in late February, the organization’s secretary, Jim Call, a soybean farmer from southwest Minnesota, asked each farmer-director to indicate "wet, dry or normal," when he conducted roll call. At that time, only about five out of the 69 farmers who voluntarily serve on USB indicated "normal," with the remaining half either indicating conditions on their farms at that time were "wet" or "dry."

At its most recent July meeting, USB farmer directors were asked to anticipate how much their soybean production will be reduced due to the drought. More than 60 percent responded that their crop would be reduced by between 10 percent and 50 percent. An additional 21 percent anticipated more than a 50 percent reduction.

Drought Drives Cattle Inventory Down, Consumer Demand Remains High

In recent history, drought has been isolated to various regions of the country, rather than a widespread drought threatening most of the country. Last year, for example, drought was centered primarily in the Southern Plains. According to Kevin Good, senior market analyst for CattleFax, 70 percent of the U.S. cattle inventory is located in regions of drought.

“The widespread drought has ultimately led to the worst pasture conditions in the past 15 years,” said Good. “The U.S. calf crop is down 800,000 head. The bottom-line, when all is said and done, the cattle herd will decrease by about 500,000 head. This is compared to a 900,000 decrease a year ago, so we are seeing a liquidation but at a slower pace than last year.”

Despite the obvious challenges facing America’s cattlemen and women, Good offered reason for optimism. Consumer demand remains strong with solid retail and foodservice sales. As consumers continue to demand nutritious beef, cattlemen are given reason to remain in the cattle business and avoid liquidation. National Cattlemen’s Beef Association (NCBA) CEO Forrest Roberts said the challenges cattlemen are facing are serious, but we are encouraging them to trust the market signals and maintain cowherds if possible.

“The thing we have to remember is that consumers continue to prefer beef on the dinner table. Consumers are sending very clear signs to cattlemen to hang tough and continue producing the protein they prefer most,” said Roberts. “There is no doubt this will be tough. But cattlemen are tough people and I am confident we will weather this storm and rebuild the U.S. cowherd once weather conditions improve.”

More than 700 cattlemen from across the country attended the summer conference in Denver. The event concludes tomorrow, July 28.

House Tackles Death Tax, Senate Strays

National Cattlemen’s Beef Association (NCBA) Associate Director of Legislative Affairs Kent Bacus offered attendees of the 2012 Cattle Industry Summer Conference an update on recent movements in Washington, D.C., regarding the estate tax. This issue, according to Bacus, is the number one priority for NCBA, which is the oldest and largest national organization representing cattlemen and women. The issue rises to the top policy issue for family-owned small businesses, such as farms and ranches, because of the burden it places on families hoping to pass their business on to the next generation.

“The estate tax is a prime example of bad tax policy and Congress should repeal. Unfortunately, we hear from some elected leaders who claim to be defenders of the little guy. Meanwhile, they avoid opportunities to kill the death tax,” said Bacus. “In order to sustain these family businesses, the future must contain a level of certainty. The next generation cannot possible afford to take over the family business if they are taxed to death.”

Bacus gave some good news to cattlemen seeking permanent relief from the estate tax. Bacus reported that Congressman Kevin Brady (R-Texas) has 218 cosponsors on his Death Tax Repeal Permanency Act. This legislation would essentially provide full and permanent relief from the tax. Senator John Thune of South Dakota also introduced a companion bill - the Death Tax Repeal Permanency Act of 2012 - in his chamber and that bill has 37 co-sponsors. They also released an updated study proving how harmful and ineffective the death tax is from the Joint Economic Committee. Bacus said the study’s key points are the estate tax continues to hurt the economy, fails as a revenue generator, creates a barrier to economic equality and could increase revenue if it were abolished.

The bad news conveyed at the conference was the recent action taken by the Senate. The Senate voted on two tax packages this week that will be used for messaging purposes this election season. Senate Majority Leader Harry Reid (D-Nev.) led efforts to secure passage of a tax package that extends tax rates for family income up to $250,000 for a year, raises the top rate on capital gains and dividends, as well as continue several targeted tax provisions. The Reid package, according to Bacus, does not address the estate tax and would leave small business owners and ranchers vulnerable to a reversion of the pre-2001 levels of a 55 percent tax on estates worth $1 million or more. Bacus said this is unacceptable.

“Most farmers and ranchers would trip the $1 million threshold on land values alone. Land values are through the roof and all of the assets it takes to operate a farm or ranch, including livestock, farm machinery and more, would hit the majority of farm and ranch families throughout the country,” said Bacus. “This is not a tax on the wealthy. We must find permanent relief or risk taking land out of production agriculture, threatening our ability to provide food for U.S. consumers and abroad.”

Bacus said NCBA supports Rep. Brady and Sen. Thune in their quest to abolish the tax. Given the current political environment, however; NCBA would also support making the current tax levels of 35 percent on farms and ranchers valued at $10 million per couple. Bacus said this tax level, which is set to expire on Dec. 31, 2012, misses the majority of farmers and ranchers.

Action Team Focuses on Membership, Leadership, Communications

At a meeting last week in Washington, the National Corn Growers Association's Grower Services Action Team reviewed new membership benefits, NCGA communications efforts and the Leadership At Its Best program. They also enjoyed a special presentation on social media by a communications official from the U.S. Department of Agriculture.

"Our team has a great portfolio of responsibilities, and we're very happy to see record membership and record investment in our programs by the state checkoff organizations," said Brandon Hunnicutt, a Nebraska grower who chairs the Grower Services Action Team. "From member benefits to leadership development to our award-winning communications programs, NCGA and its state associations have helped create a grassroots association that is effective and respected nationwide."

At its July 16-17 meeting, the team reviewed strategic plans for membership and communications for 2013. With more than 37,000 members and growing, NCGA is well on its way to meeting the goal of 40,000 members by 2020, as expressed in the NCGA Strategic Plan, Hunnicutt noted.

The team also reviewed NCGA's involvement in four key image programs: The Corn Farmers Coalition, CommonGround, American Ethanol Racing and the U.S. Farmers and Ranchers Alliance.

NCGA: American Agriculture Needs a New Farm Bill

National Corn Growers Association President Garry Niemeyer released the following statement in response to a decision by the House of Representatives to take up a one-year extension of the farm bill:

“America’s farmers need a new farm bill that will allow them the ability to make sound business decisions for the next five years.  An extension of current law fails to provide the needed level of certainty.  The National Corn Growers Association has strongly advocated programs, such as direct payments, be reformed into more efficient farm policy that will be responsive to taxpayers. 

“It is important to get to conference and pass a bill before the current law expires September 30.  Continuing outdated farm policies will negatively impact agriculture, the federal budget, consumers and the economy.”

ASA: Ask Representative to Vote Yes on H.R. 6156, Grant PNTR with Russia

The American Soybean Association is asking you to contact your representative and tell them to vote YES on H.R. 6156, the Russia and Moldova Jackson-Vanik Repeal Act of 2012. The House leadership intends to bring this legislation for a floor vote early next week if we can demonstrate sufficient support for H.R. 6156. Passage of this legislation will graduate Russia from the Jackson-Vanik amendment and authorize the U.S. to establish permanent normal trade relations (PNTR) with the world’s sixth largest economy.

On Aug. 22 – less than 30 days – Russia will become a member of the World Trade Organization (WTO). In order for U.S. soybean farmers to take advantage of the many market opening commitments that form Russia’s accession package to the WTO, Congress must pass legislation to graduate Russia from the Jackson-Vanik amendment.

There are only FOUR legislative days remaining to pass this legislation – it is critical that Congress enact it before the August recess.

Facts about the Russian Market
-    Russia is the world’s sixth largest economy with more than 140 million consumers, and is an important market for the U.S. soy industry as it imported more than $770 million in meat, poultry, egg and dairy products in 2011.
-    The pork and poultry industries, which use soybean meal in animal feed, are poised to see great success in Russia as income levels rise and the demand for meat increases.
-    If Congress fails to approve PNTR with Russia, U.S. farmers will not be able to take advantage of the benefits of those market-opening reforms, letting more than 150 other countries seize the benefits of Russia’s open market.
-    Establishment of PNTR with Russia will not require the U.S. to provide any market access benefits, lower any U.S. tariffs, or make other changes to our trade laws.

One-Year Farm Bill Extension Possible on House Floor

(from NAWG)

As the agronomic and political impacts of the nation’s growing drought came into clearer focus this week, House Republican leaders shifted course toward possible consideration of a one-year extension of current farm programs.

At a House Agriculture Committee Members meeting Wednesday, Committee Chairman Frank Lucas (R-Okla.) pitched the idea, which would also include an extension of disaster relief programs, especially vital for livestock producers who cannot buy crop insurance and do not participate in Title I.

By Thursday, Republican leaders were whipping votes and planning for floor consideration next week, the last week before the month-long August recess.

Lucas, who has the unenviable job of convincing his leadership to bring any farm legislation to the floor, told members of the press at mid-week that an extension was possible and even logical with drought effects worsening by the day.

His Democratic counterpart, Ranking Member Collin Peterson, and Senate Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.), first voiced opposition to an extension. However, if Stabenow seeks to move a bill to conference committee following a successful House vote, the way could be paved for Congress to pass a full farm bill before current law expires on Sept. 30.

Questions about the potential plan abound. It’s not yet clear how direct payments, which were eliminated in both House Committee- and Senate-passed versions of the bill, will be treated under a possible extension.

The effect of an extension on the law’s baseline – which has already been reduced dramatically in recent years and could take another hit with coming sequestration cuts in 2013 – is unknown.

Another concern is how Members in both chambers will react to a hopeful but unconventional path toward farm bill passage.

National Association of Wheat Grower’s priority continues to be achievement of a new, five-year farm bill before current law expires this fall. A short-term extension doesn’t give farmers the certainty that they need and would likely not incorporate reforms that have been essential to gaining support for new farm and food policy in both chambers.

SPCC Clarity Bill Approved By House Transportation Committee

The House Transportation and Infrastructure Committee approved a bill Thursday to clarify requirements facing farmers under the Spill Prevention Control and Countermeasure, or SPCC, rule.

The bill, the Farmers Undertake Environmental Land Stewardship (FUELS) Act or H.R. 3158, was introduced last fall by Rep. Rick Crawford (R-Ark.) and co-sponsored by 38 other Members.

It would ease some of the restrictions imposed by the current SPCC rule, which is administered by the Environmental Protection Agency (EPA).

The SPCC rule is applicable to any facility, including farms, with an aggregate above-ground oil storage capacity of 1,320 gallons in tanks of 55 gallons or greater. In order to fully comply with SPCC rules, a facility must have, among other things, identified contractors who can help operators clean up an oil spill; provided overfill prevention devices such as a high-level alarm; and provided effective secondary containment measures such as a dike or double-walled tanks.

Farms in operation before Aug. 16, 2002, need SPCC plans in place now, while those started after Aug. 16, 2002, have until May 10, 2013, to develop and implement their plans.

The bill passed this week would create three classes of farms for SPCC purposes:
1) Farms with individual tanks with storage capacity greater than 10,000 gallons, aggregate storage capacity of at least 42,000 gallons or spill histories would need professional engineers to certify their SPCC plans.
2) Farms with aggregate storage capacity greater than 10,000 gallons but less than 42,000 gallons and no history of spills could be self-certified by the farms’ owners or operators.
3) Farms with aggregate storage capacity less than 10,000 gallons and no history of spills would be exempt from requirements.

The bill would also exclude all containers on separate parcels that have a capacity less than 1,320 gallons from the aggregate storage capacity of a farm.

NAWG and a dozen other organizations wrote leaders of the Committee on Wednesday to express strong support for the bill, saying it would “bring some much needed clarity to agriculture on the confusing requirements of the EPA’s [SPCC] rule.”

The agriculture community has repeatedly expressed concerns that the existing threshold for SPCC plan requirements, 1,320 gallons, has no scientific or industry basis; that establishing two separate rule deadlines for long-existing and newer farms has caused intense confusion; and that requiring professional engineers to sign off on SPCC plans adds significant logistical hurdles and cost to compliance with the rule.

Groups representing farmers have been further frustrated by EPA’s response to questions about compliance assistance and challenges getting EPA officials to farms to talk with agricultural producers about the issue.

RFA thanks Obama Administration for responsible defense of the RFS

Obama Administration statements rebuffing “alarmist calls” for the need to waive the Renewable Fuel Standard (RFS) are absolutely correct, wrote Renewable Fuels Association (RFA) President and CEO Bob Dinneen in a letter to Agriculture Secretary Tom Vilsack and EPA Administrator Lisa Jackson.

“Both of your agencies have responsibly answered the panicked appeals to modify or dismantle the RFS, stating plainly that consideration of waiving the program is simply not warranted. Your comments have provided the kind of certainty and security that is necessary to ensure the renewable fuels industry continues to evolve. Further, your agencies’ recent remarks regarding the RFS serve as important signals to the investment community that the nation’s commitment to diversifying our fuel supply and creating a future market for new advanced biofuel technologies remains intact,” Dinneen wrote.

Specifically, Dinneen addressed concerns caused by the hot and dry weather by underscoring how the “tremendous flexibility built into the RFS program” was designed to accommodate marketplace anomalies like this summer’s drought.

“The ability of obligated parties under the RFS to “bank” excess Renewable Identification Number (RIN) credits and use them for compliance in the following year provides a significant measure of flexibility that takes pressure off of the corn market in the event of a short crop,” wrote Dinneen.

Dinneen pointed to the estimated 2.4-2.6 billion RINs available and recent analysis by Professor Bruce Babcock at Iowa State University that found a waiver might result in only a 4.6% reduction in corn prices.

Professor Babcock concluded that, “The desire by livestock groups to see additional flexibility in ethanol mandates may not result in as large a drop in feed costs as hoped.” He further found,  “…the flexibility built into the Renewable Fuels Standard allowing obligated parties to carry over blending credits (RINs) from previous years significantly lowers the economic impacts of a short crop, because it introduces flexibility into the mandate.”

Dinneen also confronted erroneous contentions that ethanol demand for corn was inelastic as a result of the RFS requirements.  Dinneen noted that, “Since the first week of June, which is when corn prices began to surge in response to worsening drought conditions, ethanol consumption of corn has fallen nearly 14 percent and is at a two-year low. In this same period, corn export inspections actually increased 15 percent.”

“When all the facts are on the table, it becomes abundantly clear that waiving or altering the RFS in any way at this time would not be prudent, nor would it have any meaningful impact on corn prices or availability for feed use. Clearly, market signals and the flexibility of the RFS are already working to ration demand in anticipation of a shorter-than-expected grain crop. Still, even if ethanol production is significantly reduced as a result of tighter supplies of corn in 2012/13, obligated parties should have very little difficulty in meeting their obligations under the RFS for 2012 and 2013.,” Dinneen concluded.

USGC North China Crop Tour Shows Good Corn but Poor Wheat Crop

Corn production in North China is projected to be about 3.5 million metric tons (138 million bushels) greater than last year provided weather conditions remain favorable, according to conclusions reached following industry crop tours coordinated by the U.S. Grains Council's office in Beijing.

The anticipated increase in North China, along with a 2-4 million ton (79-157 million bushel) increase in Northeast China and a 1-2 million ton (39-79 million bushel) increase in other growing regions, adds up to an anticipated 6-10 million ton (236-394 million bushel) increase overall in China this year compared to last, said Bryan Lohmar, USGC director in China.

"While China's corn crop looks good, there may be greater demand for corn since the country's winter wheat crop was adveresly affected by disease and poor weather" Lohmar said. "This may result in less wheat being used in place of corn in animal feed, which may create additional demand for corn."

The crop tours were conducted July 9-13 and visited Henan, Shandong and Hebei provinces, where roughly 30 percent of China's corn is produced.

Kenny Chesney Joins Lineup for Farm Aid Concert

Kenny Chesney will join Farm Aid at its annual benefit concert at Hersheypark Stadium on Sept. 22, the organization announced Thursday.

"Growing up in a small town outside Knoxville, family farmers were a big part of our community," said Chesney, who is from Luttrell, Tenn. "I am proud to play on the Farm Aid stage again, especially in Central Pennsylvania, where agriculture is at the heart of the community."

Chesney is a four-time Academy of Country Music and Country Music Association Entertainer of the Year. He joins the star-studded Farm Aid 2012 lineup, which features Farm Aid board members Willie Nelson, Neil Young, John Mellencamp and Dave Matthews, performing with Tim Reynolds, as well as Jack Johnson, ALO, Pegi Young & The Survivors, and Lukas Nelson & Promise of the Real.

"Kenny Chesney is a true friend to America's family farmers and we are proud to have him back on the Farm Aid stage this year," said Carolyn Mugar, executive director of Farm Aid. "The Farm Aid concert is possible thanks to the generosity of the artists, who donate their time and their performances to raise awareness about the family farmers who grow good food for all of us."

Tickets for Farm Aid 2012 are available at , , Ticketmaster outlets, GIANT Center Box Office, or by phone at 800-745-3000. Ticket prices range from $35.75 to $99.75. For venue information, visit .

Farm Aid's mission is to build a vibrant, family farm-centered system of agriculture in America. Farm Aid artists and board members Willie Nelson, Neil Young, John Mellencamp and Dave Matthews host an annual concert to raise funds to support Farm Aid's work with family farmers and to inspire people to choose family farm food. Since 1985, Farm Aid, with the support of the artists who contribute their performances each year, has raised more than $40 million to support programs that help farmers thrive, expand the reach of the Good Food Movement, take action to change the dominant system of industrial agriculture and promote food from family farms.

Thursday, July 26, 2012

Thursday July 26 Ag News

Rural Poll: Smaller Towns' Residents Less Likely to Attend Church

Residents of Nebraska towns smaller than 500 in population are less likely to attend church than those who live in larger towns, perhaps a sign that churches are not the community resource they once were, according to the Nebraska Rural Poll.

The 17th annual University of Nebraska-Lincoln poll was sent to 6,350 households in Nebraska's 84 nonmetropolitan counties in March and April. Results are based on 2,323 responses.

As in past years, the poll asked questions about rural Nebraskans' attitudes about their communities including, for the first time, questions about church attendance and perceptions about church.

The survey used the word "church" generically, and it may apply to a small number of respondents from non-Christian faith groups.

Seventy-five percent of poll respondents said they are members of a church, with 39 percent saying they attend services weekly or more often. By community size, residents who live in or near towns of fewer than 500 were least likely to attend weekly church services; thirty-five percent reported doing so.

That was a bit of a surprise, said Philip Schwadel, an associate professor of sociology and member of the Rural Poll team.

"I expected them to be more highly churched," said Schwadel, who specializes in issues related to religion and faith.

The relatively low rate of church attendance in the smallest communities may stem from decreased numbers of churches, including a lack of diversity in denominations available in small towns, Schwadel speculated.

"Church doesn't seem to be the symbol of stability it once was," he added.

However, rural Nebraskans remain satisfied with religion/spirituality, the poll indicated. Seventy-five percent said they were somewhat or very satisfied with this part of their lives.

By region, the Panhandle lags in church membership, at 65 percent, far lower than membership in the Northeast and Southeast regions, which is about 78 percent. Cheryl Burkhart-Kriesel, a UNL Extension educator based there, said that likely is a result of the distances that must be traveled to reach churches of one's denomination.

Other poll findings about rural Nebraskans and church:
– Eighty-six percent of people 65 and older are church members, compared to 64 percent of those 19 to 29. Also, 59 percent of older rural Nebraskans attend church at least weekly; just 23 percent of those in the younger age group do so.
– Eighty-three percent of those with agricultural occupations are church members, compared to 56 percent of those who work in production, transportation or warehousing businesses.
– Respondents with at least a bachelor's degree were more likely than those with a high school degree or less to be church members, 81 percent to 74 percent, and more likely to attend services at least once a week, 46 to 41 percent.
– Overall, 77 percent of respondents say their church serves as a resource to the entire community, though there are differences again between groups. For instance, 80 percent who live in cities of 10,000 and up agree with that; 70 percent in towns of fewer than 500 do. Older rural Nebraskans are more likely than the 19-29-year-old group to say that, by 81 to 72 percent.
– Sixty-seven percent believe their church is financially stable, and 66 percent say they are not concerned that their church may need to close or consolidate. Fifty-two percent said they don't think their church will decline over the next few years. Again, differences emerge between categories of communities, with those in the smallest communities less confident about their churches' financial stability and future than those in larger towns.

Other poll findings are similar to past years'.
-  Fifty-one percent of respondents believe they are better off than they were five years ago, the third-highest in the poll's history.  When the poll was taken in the spring, noted Randy Cantrell, UNL rural sociologist, the agricultural economy was strong. "There is a relationship between how that sector is doing and how people feel about their general condition," he said.
-  Forty-five percent of respondents believe they'll be better off in 10 years and 20 percent believe they'll be worse off – both numbers, again, fairly close to trends over the poll's history.
-  Rural Nebraskans are most satisfied with the conditions of their marriage, family, friends, spirituality and the outdoors, while less satisfied with job opportunities, current income and financial security during retirement. However, satisfaction with job opportunities increased from 38 percent in 2011 to 46 percent this year.

Cantrell speculated that rural Nebraskans' satisfaction with job opportunities and other factors may be based in part on the attention the state has received nationally for weathering the recession much better than other states.

The Rural Poll is the largest annual poll of rural Nebraskans' perceptions on quality of life and policy issues. This year's response rate was about 37 percent. The margin of error is plus or minus 2 percent. Complete results are available online at

The university's Center for Applied Rural Innovation conducts the poll in cooperation with the Nebraska Rural Initiative with funding from UNL Extension and the Agricultural Research Division in the Institute of Agriculture and Natural Resources.

Insurance Coverage for Drought-Damaged Crops

Nearly 90 percent of the corn and soybean acres in Iowa are covered by multiple peril crop insurance. Drought damage is an insurable loss under these policies. Producers should consult with their crop insurance agents before harvesting or destroying any drought-damaged crops, said William Edwards, an Iowa State University Extension and Outreach economist.

"The agent will notify a certified crop adjustor to appraise the insured crops," Edwards said. "Keep in mind that when damage is widespread, adjustors cannot be everywhere at once. The adjustor may declare the crop a complete loss. If it has significant yield potential, it can be left and harvested in the fall. If the producer elects to harvest it early, as silage, check strips can be left to verify the actual yield achieved. In any case, the acres must be released by the insurance company before the crop can be harvested early or destroyed."

Any insurance indemnity payments will be settled based on actual harvested production over the entire insurance unit, Edwards said. Fields declared a complete loss will be combined with any harvested acres in the same insurance unit to calculate the final yield. Yield losses are equal to the farm's historical yield times the level of guarantee purchased, minus the actual yield.

Ninety percent of the insured acres in Iowa are covered by Revenue Protection insurance policies in 2012. Yield losses will be paid at a rate equal to the average CME futures price during the month of October, if it exceeds the average February price of $5.68 for corn (December contract) or $12.55 for soybeans (November contract).

Following harvest, the usual evidence of actual production should be collected and submitted to the crop insurance agent as soon as possible if it appears that a payment is likely, but not later than 15 days after the end of the insurance period, which is Dec. 10 for corn and soybeans in Iowa. If a producer has a history of selling more than half the crop in the tax year following harvest, reporting of crop insurance proceeds can be deferred to the next tax year, Edwards said.

More information about crop insurance policies and procedures can be found on the Ag Decision Maker website at For additional crop, livestock and home and yard drought related information see Dealing with Disasters.

Stretch Pastures in Drought Conditions

As the drought continues, cattle producers are asking how to stretch their pastures. Two major techniques may be pursued, according to Iowa State University Extension and Outreach beef program specialist Denise Schwab. One is to reduce the grazing pressure from the animal side, and the other is to supplement the amount of feed available.

"Animal grazing pressure can be reduced in two ways, reducing cow numbers through selective culling and weaning calves early," Schwab said. "Consider culling any cows with structural, health, reproductive or attitude problems. Early pregnancy checking with ultrasound may be another tool to help tighten the calving period and cull very late cycling, open cows."

Research has shown calves can be successfully weaned as young as 90 days or less, but consistently weaned at 100-120 days of age. Some of that success depends on giving one round of vaccinations to the calves prior to weaning, and creep feeding for 10-14 days prior to weaning. Weaning reduces the nutrient requirements of the cow 30-50 percent, allowing for energy intake to go toward cow maintenance rather than milk production. Creep feeding is another tool to reduce the feed requirements on the cow, but feed efficiency of creep feeding is extremely variable. Calves tend to be more efficient after weaning when fed directly.

"The second technique is to supplement the cow while on the pasture," she said. "There are several considerations for this, including labor and equipment to feed, controlling feed waste, and the cost of the supplemental feed."

Feed cost really needs to be the major consideration, followed by the issue of how to deliver and control wastes. Many producers will want to feed hay as the supplement, which seems like the logical solution, Schwab said. However, if feeding hay on pasture, producers need to be extremely conscientious about control waste and limiting intake. If allowed full-time access to hay, cows can easily consume far more than is needed. Remember, you want to supplement pasture, not completely replace grazing.

Also, as hay price approaches $150-200 per ton, this probably isn't the most cost effective option, she said.

"For example, a mature 1,350-pound cow fed completely in dry lot could consume about 38 pounds of hay per day, which would cost $2.78 per cow per day if hay is priced at $150/ton," she said. "Studies have shown that cows need about 0.5-1.0 percent of the cow's bodyweight in supplemental feed per day, or 7-13 pounds of hay to substitute for available forage, which would cost $0.50-$1 per cow per day. Another option is to supplement 3-5 pounds of grain or co-product and 5 pounds of hay per day which would cost between $0.65-0.75 per cow per day in addition to the available forage."

Another possibility is to supplement only the grain/co-product while on pasture at about 5 to 6 pounds per head per day. Depending on the current pasture situation, this may or may not have enough total feed available to meet all the cows' needs. Doubling the quantity and offering it only every other day is also a supplementation strategy that has been proven to work.

"How do you know which feeds are the most cost effective? You really need to determine the price per pound of energy or protein in the feed to compare multiple feeds," Schwab said. "A quick way to do that is to use the Iowa Beef Center's spreadsheet 'Feed Energy Index,' which is available as a free download from the IBC website. By simply typing in the various feeds available and their costs, you can get a quick comparison of which feeds provide the lowest cost energy."

There are multiple strategies that can help stretch pasture in drought situations such as this year. However, they should be individualized to meet the specific needs of each producer and pasture. For more help on stretching pasture, contact an ISU Extension beef program specialist.

Blue-Green Algae a Concern for Iowa Livestock

Already this summer there have been reports of blue-green algae blooms in Iowa ponds, prompting farmers to pay close attention to grazing and water resource location for their livestock.

Blue-green algae are commonly found in Iowa lakes, ponds, rivers and streams during summer and autumn, and can form dense algal blooms that resemble mats on the water surface. These blooms can be stimulated following storms or heavy rainfall when surface runoff containing phosphorus and nitrogen enters the water. The blooms can be quite bad when storm events are followed by prolonged periods of hot temperatures.

"Because blue-green algae can produce poisonous neurotoxins and hepatoxins, they also are a potential health concern to livestock, pets, wildlife and humans, and can be fatal if consumed," said Steve Ensley, Iowa State veterinary diagnostic and production animal medicine clinician.

Ensley and Chris Filstrup, of the Iowa State Limnology Laboratory, explain how to recognize blue-green algae in a one-page fact sheet they have written. The fact sheet also describes potential toxic effects of the algae, proper sampling methods for testing and suggests ways to reduce the incidence of blooms in lakes and ponds.

The Limnology Lab focuses on research and analyses of aquatic ecology in the Midwest, and offers a variety of tests and information on water-based information and resources.

Waiving RFS isn't solution to dramatically lower corn prices

New analysis from the Center for Agriculture and Rural Development (CARD) at Iowa State University suggests that calls for the immediate reduction, revision, or repeal of the Renewable Fuel Standard (RFS) would not achieve the stated goals of those industries calling for such action.

“The desire by livestock groups to see additional flexibility in ethanol mandates may not result in as large a drop in feed costs as hoped,” wrote Iowa State Professor Bruce Babcock, author of the study.

Babcock analyzed 500 different scenarios assuming varying levels of corn yield this year.  In his research, Babcock determined that a total waiver of the RFS would reduce corn prices less than 5% and cause less than a 5% reduction in ethanol production.

Babcock states the modest results are due to flexibilities in complying with the RFS in 2012 and 2013. Specifically, an estimated 2.4 billion excess Renewable Identification Numbers (RINs) can be used in place of physical gallons to demonstrate RFS compliance.

“[T]he flexibility built into the Renewable Fuels Standard allowing obligated parties to carry over blending credits (RINs) from previous years significantly lowers the economic impacts of a short crop, because it introduces flexibility into the mandate,” wrote Babcock.

Removing the mandate altogether decreases corn prices by only $0.28 per bushel relative to the case where excess RINs are used for compliance. This is equivalent to roughly 3.5% of recent corn prices and 4.6% of the CARD study’s projected season-average.

In a blog post, Renewable Fuels Association (RFA) Vice President of Research and Analysis Geoff Cooper outlined the flexibility that exists in the RFS and how it can be used to ensure the RFS works as designed.  Cooper’s blog can be read here.

“All available market data suggests that the Renewable Fuel Standard is working,” said RFA President and CEO Bob Dinneen.  “Strong supplies of ethanol in storage and an abundance of RINs combine to make the RFS a workable and achievable program in 2012 and 2013.  Let’s be clear; the weather impacting much of the country is a very real cause for concern.  The ethanol industry, like any other end user of corn, understands this point and the industry has significantly reduced its corn consumption in recent weeks.  However, some appear to be trying incite panic rather than objectively review the facts.  The final crop is not yet in the bin.  There will be corn available this fall and the market will ration its use.  The questions will be how much and how will farmers respond during next year’s planting season.”

Currently, weekly ethanol production has fallen below 800,000 barrels per day – a level not seen since June 2010.  This reduction in production clearly shows that the market is responding by rationing demand.

“Now is not the time to implement knee-jerk reactions that arbitrarily reduce RFS requirements based on historically variable corn supply estimates or waive portions of the RFS,” said Dinneen.  “Such actions would likely do more to disrupt the fuel market than alleviate concerns over high corn prices.  If given a chance to work, the RFS will demonstrate itself to be a thoughtful energy initiative with the kind of flexibility to absorb situations like the one we are in and still achieve its goals.”

NPPC Says Trade Barriers Need To Fall

Pork producers and the U.S. economy are losing billions of dollars in exports because of non-science-based food-safety and health barriers erected by foreign countries, the National Pork Producers Council today told a House subcommittee.

Testifying on behalf of NPPC, Jim Boyer, a hog farmer from Ringsted, Iowa, told the Small Business Committee’s agriculture, energy and trade panel that so-called sanitary and phytosanitary (SPS) measures are restricting market access for U.S. pork and are adversely affecting U.S. pork producers, particularly small ones like him.

Those trade-restricting barriers must fall, said Boyer in discussing SPS issues NPPC wants addressed in any trade agreements the United States negotiates, including:
-    Trans-Pacific Partnership: While the U.S. pork industry supports the TPP – an 11-nation regional trade pact – countries that are part of the agreement must eliminate their SPS barriers. The deal also should include an SPS chapter with a meaningful dispute-settlement provision.

-    Russia: The country, which soon will join the World Trade Organization, has a number of SPS measures that restrict U.S. pork imports, including a zero-tolerance standard for pathogens on meat, a standard no country can meet. Russia should abide by the WTO’s Agreement on the Application of Sanitary and Phytosanitary Measures.
-    European Union: Although it should be one of the largest export markets for U.S. pork, the EU is one of the smallest because of its SPS barriers. Any U.S.-EU trade agreement must address such non-science-based trade restrictions.
-    Taiwan: The Asian nation unfairly restricts U.S. pork exports from hogs fed ractopamine, a feed additive approved by the U.S. Food and Drug Administration, 25 other countries and the U.N.’s food-safety standards-setting body. Taiwan’s entry into the TPP negotiations should hinge on it eliminating that SPS barrier.

“We are convinced that if we sit by passively while SPS measures are erected and maintained, we will see our exports rapidly erode,” Boyer testified. “Pork producers understand that the future of our industry depends on adopting new and safe technologies and in expanding exports. We must protect our current market access from unfair barriers or such expansion will be impossible.”

Soybean aphids: A late-season game-changer

Hidden within the soybean canopy is a tiny but highly destructive pest known as the soybean aphid.  This pest can destroy your soybean field before exhibiting a single trace of evidence. Leaving no visible feeding scars, soybean aphids threaten to significantly reduce soybean yields by feeding on the stems and undersides of soybean leaves. Because of the lack of evidence, these inconspicuous insects are difficult to detect before they have reduced yields.

Soybean aphids can appear on soybeans through pod fill and can quickly reach damaging economic thresholds if left uncontrolled. Aphid populations fluctuate due to weather, predatory feeding, disease and plant stress. During favorable conditions, populations can double every two to three days. Soybean aphids have the ability to cover an entire field due to their rapid population growth, significantly impacting yields and profits.

Soybean aphid reproduction is slow in hot dry environmental conditions. Based on this, the 2012 season should be a light year for infestations. However, when the weather pattern becomes more favorable for aphid reproduction, aphid numbers are still expected to rise in late summer/early fall.

“Soybean aphid pressure hasn’t been too high yet this growing season,” said Troy Griess, agronomic service representative, Syngenta. “However, in Minnesota and parts of Iowa, some growers are already seeing these pests in their fields. Soybean aphids become a problem when they reach the economic threshold of 250 aphids per plant in 80 percent of your field and need to be treated properly.”

North American Manure Expo to be Hosted in Wisconsin

The North American Manure Expo, which is an educational program that travels to different host states each year, returns to Wisconsin next month. The event will be held August 22 at the USDA-Dairy Forage Research Center farm located just north of Prairie du Sac.

This year's expo will feature field demonstrations, hands-on product and safety education, educational sessions, exhibitor booths, and commercial vendor displays. There is no cost to attend the forum.

Organizers say this is the 10th Manure Expo since the program started in Wisconsin. Other states that hosted the event include Minnesota, Michigan, Ohio, Iowa, Pennsylvania, and Nebraska.

The North American Manure Expo is presented by the Professional Nutrient Applicators Association of Wisconsin, University of Wisconsin Extension Nutrient Management Team, USDA-Dairy Forage Research Center and is supported in part by a consortium of land grant universities and conservation agencies from across the country.

IGC Cuts World 2012-13 Corn Output

The International Grains Council said Thursday it had cut its estimate for world corn production in 2012-13 by 53 million metric tons to 864 million tons, as high temperatures and severe drought in the U.S. have reduced yield prospects.

The London-based body said its forecast for the U.S. corn crop had been cut by 50 million tons, to 300 million tons, while its view on the country's soybean harvest had also been reduced by 8.3 million tons to 79 million tons.

The IGC said export availability of corn is tightening and global carryover stocks are now expected to decline to their lowest level in six years, while world demand is projected to rise about 1% on the year.

However, it added that forecasts for feed use had been trimmed due to higher prices and lower supply, while industrial use is also expected to decline, with U.S. ethanol production likely to fall on the year.

The IGC said that world soybean production is expected to recover sharply in 2012-13, rising by around 9% on the year, although that forecast hinges on a strong rebound in output from South America, where planting begins in the fourth quarter.

European Commission won’t levy preliminary duties on U.S. ethanol imports

Yesterday, the European Commission (EC) informed European Union (EU) member states that it would not be issuing any order imposing preliminary duties in connection with the anti-dumping/anti-subsidy case filed with the EC by EPure, the trade association representing Europe's ethanol industry.  In response, the Renewable Fuels Association (RFA) and Growth Energy (GE) issue the following release:

"We are pleased to learn that the European Commission will not impose provisional countervailing (aka anti-subsidy) or anti-dumping duties on ethanol produced in the United States.  The RFA and GE appreciate the Commission's hard work and careful consideration of the facts in these proceedings.  Both organizations will continue to cooperate fully with the Commission and both look forward to the speedy resolution of these proceedings."

Updated Land Values Report Finds Land Values Increased More Strongly than Expected

Farmland values that increased by as much as 20 to 30 percent, and the factors that may eventually slow those growing ag land values, headline an updated land values analysis issued today by the Rabobank Food & Agribusiness Research and Advisory (FAR) group.

“The six year surge in U.S. agricultural land values continues to be top-of-mind for many in agriculture,” notes report author Sterling Liddell, Vice President, Food and Agribusiness Research & Advisory. “We expected land values to grow significantly in late 2011 and early 2012 and the growth was even stronger than we predicted; in excess of 30 percent in some cases.”

In the report, “U.S. Farm Land Continues to Dazzle,” Liddell draws a strong correlation between the rate of growth and higher corn, soybean and wheat prices, which resulted from persistently tight global grain stocks and low interest rates.

“Strong fundamentals including elevated commodity prices, low interest rates, increasing rental rates and strong relative returns to agriculture will continue to make U.S. farmland an attractive investment,” says Liddell.

The U.S. Corn Belt region continued to lead land value growth in 2011 and 2012. States including Iowa, South Dakota and Nebraska were estimated by the USDA to have doubled their 2005 values. An expanded group of states, which adds the Northern Plains and Minnesota, saw year-over-year growth in the range of 15 to 30 percent in 2012

The report considers interest rate increases to be the key medium-term threat to maintaining current levels of ag land values.

Looking ahead to the first half of 2013, U.S. farmland values are likely to increase at a slower rate than in 2011 and 2012. The slowdown is a result of the dramatic 2012 jump in values as well as looming macroeconomic worries. This slowdown will help to keep values in line with underlying fundamentals. As a result, such a slowing would be beneficial for the long-term financial health of the U.S. crop production industry.

“The prospect of strongly higher interest rates post 2014 and softening commodity prices from current highs present the key long term risks for U.S. farmland values,” notes Liddell.

Bunge Q2 Profit Down 13%

Bunge Ltd. expects strong earnings in its grain handling business through the rest of 2012 despite a severe drought that is decimating U.S. grain supplies and sending prices to what its chief executive called "crisis" levels.

Bunge, one of the world's largest grain traders and soybean processors, said profits in its corn agribusiness segment surged vs. a year ago even as its overall second-quarter earnings declined 13% due to troubles with its sugar-milling business.

The company said that while dwindling U.S. corn supplies and surging prices could cause weaker demand, any loss in volume would be made up by its South American grain operations.

Prices for corn and soybeans have soared recently, setting all-time records at the Chicago Board of Trade last week as the drought intensified. That has prompted worries about a pending global food crisis.

The situation may not be as dire as with other sharp price increases in the past five years, as Bunge Chief Executive Alberto Weisser said that supplies of wheat and rice -- two food staples that are often associated with political unrest -- remain adequate. Still, he noted that corn and soybean prices have surged even higher than in previous spikes.

"I think we are in a crisis," Weisser said in an interview. "Nobody likes these prices to be so high."

The situation could "turn very fast back to normal," he said, but that will take a large South American crop, which won't be harvested until next year.

In the meantime, the U.S. will have limited grain supplies to export by early 2013, Weisser said. This will create "nontraditional trade flows," which could benefit Bunge, which has a wide network of export terminals and storage facilities world-wide to fill buyers' needs.

The company's weaker second-quarter results stemmed largely from the sugar and bioenergy segment, which swung to a $28 million loss from a profit of $18 million a year earlier. Bunge, whose efforts to grow its Brazilian sugarcane milling business after buying five new mills in 2010 has been hurt by drought, said that rains in the quarter "interrupted milling operations and reduced the sugar content of harvested sugarcane."

Bunge reported a profit of $274 million, or $1.78 a share, down from $316 million or $2.02 a share, a year earlier. Excluding certain gains and charges, per-share earnings were $1.20 in the latest quarter, compared with $1.78 last year. Revenue grew 4.1% to $15.09 billion.

The company said its food and ingredients business was hurt by lower margins. The agribusiness segment reported earnings jumped to $386 million, from $308 million the prior year, due to strong South American results and added volumes from new export terminals in the Pacific Northwest and Ukraine.

While the second quarter is typically a slow period for Bunge's sugar and bioenergy business, Chief Financial Officer Drew Burke told investors the company had hoped to break even.

But the rains that hampered results in the second quarter should be a benefit later in the year, he said, as they will help development of the next sugarcane crop.

Dow Chem Q2 Net Income Falls

Dow Chemical Co.'s second-quarter net income fell 34 percent as weaker demand led to lower prices. Softness in Europe and a stronger dollar also weighed on results. The nation's biggest chemical maker expects to accelerate cost-cutting efforts.

Dow Chemical's results can offer a broad overview of global economic conditions because its products are used in nearly every sector. Its materials are used in products ranging from televisions and toys to automobiles.

Since the end of the first quarter, economies have slowed in the U.S. and China. Some European countries have fallen into recession as the massive debt crisis there continues. Manufacturing declined in all three regions.

Experts say that has cut demand for chemical products in a wide range of industries; including commercial construction, housing and consumer products like electronics.

"Sustained uncertainty in the world economy continues to present a challenging operating environment, and this quarter was no exception," Chairman and CEO Andrew Liveris said in a statement.

He said that Europe's troubles have continued to pressure the company, while activity in China and other emerging markets slows. The U.S. is also a factor, Liveris said, as the nation's recovery is moderating from earlier in the year due to weakening consumer confidence, softer trade flows and high unemployment.

To contend with these conditions, Liveris says that Dow Chemical will ramp up its efforts to cut costs.

"Despite these near-term headwinds, Dow has the right strategy in place to deliver over the long term," he said.

For the April-June quarter, Dow Chemical's earnings fell to $649 million, or 55 cents per share. That's down from $982 million, or 84 cents per share, a year ago.

Revenue dropped 10 percent to $14.51 billion, missing Wall Street's estimate of $15.69 billion.

Prices fell 5 percent, declining in all geographic regions. The biggest drop — 8 percent — was in Europe.

One bright spot was the agricultural sciences division, which reported a 12 percent rise in sales.

Sales declines were reported by the electronic and functional materials unit, coatings and infrastructure solutions, the performance materials segment, performance plastics and the feedstock and energy division.

BASF Q2 Profit Down 15%

BASF SE, the world's largest chemicals company by sales, Thursday confirmed its full-year outlook despite lower second-quarter profit being hit by destocking by customers and stalling demand in China.

"Our customers are continuing to act cautiously and are reducing their inventories, also in expectation of falling prices due to declining raw material costs," Chief Executive Kurt Bock said in a statement.

He added in a conference call with reporters that the company doesn't expect a revival in orders in the second half of the year.

The Chinese growth engine has started to slow and BASF's sales fell in local-currency terms in Asia in the second quarter, as they also did in the first quarter of 2012, Bock said.

Although the company had planned a slight increase in its workforce, especially in emerging markets, in 2012, BASF said it will now slow down the process as it can't estimate when business in Asia will pick up again. Investments, however, won't be affected by the decline, Bock stressed.

After reporting first-quarter earnings in April, BASF said it expected a stronger second half of the year, with demand mostly coming from emerging markets. However, at the end of May, Vice Chairman Martin Brudermueller said business momentum in Asia including China had been weaker than expected, with the European debt crisis weighing on Asian markets.

The debt crisis hasn't affected paying habits in Europe, however, and invoices are still paid on time also in weaker euro-zone countries, Bock told reporters.

Bernstein Research, meanwhile, noted that earnings per share came in below its expectations with the company admitting that prospects are dampened by uncertainty. "We remain cautious due to industry sentiment remaining negative and volatile," analyst Jeremy Redenius said.

Second-quarter sales in the German group's chemicals segment came in lower on the year, due to weaker demand and the optimization of the supply chain for steam cracker products carried out in the third quarter of 2011. The company said it doesn't expect to match that unit's 2011 performance this year.

The agricultural unit, meanwhile, went strong, being with oil & gas the main positive drivers of second quarter results, and Bock told CNN in an interview that 2012 could become a new record year for the Agricultural segment.

For the group, BASF continues to guide for an increase in sale and earnings on the year in 2012.

"Our forecast is especially supported by the resumption of our crude oil production in Libya," Bock said.

To counter macroeconomic challenges BASF wants to protect its margins and create value, saying its STEP excellence program, which it expects to contribute around 1 billion euros ($1.21 billion) to earnings each year as of the end of 2015, is fully on track.

Second-quarter net profit came in below analysts' expectations at EUR1.23 billion, down 15% on the year, while sales rose to EUR19.5 billion, up 6% on the year mainly due to positive currency effects and a weaker euro, the company said.

Peter Spengler of DZ Bank said net profit was also dented by an increased tax rate, as greater-than-expected oil production in Libya led to higher nondeductable oil tax.

BASF's closely watched adjusted earnings before interest and taxes was EUR2.49 billion, up 11% on the year.

The group's update follows that of other chemicals companies. U.S.-based DuPont Co. (DD) on Tuesday reported a decrease in second-quarter net profit, due to lower volume and adverse currency moves and now expects 2012 adjusted earnings at the lower end of its current forecast range. Sales in DuPont's agricultural unit, however, rose 13%, and sales in developing markets also showed a solid increase.

Wednesday July 25 Ag News

Nebraska Approved for Statewide Haying and Grazing of Conservation Reserve Program (CRP) Acreage

“In response to the ongoing serious drought conditions Secretary Vilsack has now opened emergency haying and grazing statewide in Nebraska,” announced Farm Service Agency State Director Dan Steinkruger. 

The announcement yesterday opened all of the CRP acres in eastern Nebraska.

The emergency use of CRP will provide additional forage for the livestock industry.  A 10% reduction in the annual rental payment applies.  There are certain limitations on haying and grazing to protect the environmental value of the conservation practices.  A number of the special practices have limits on them or are not available for haying or grazing.  The announcement also removed restrictions on the sale of CRP hay.

Steinkruger noted, “The Farm Service Agency is continuing to utilize our available program options to assist farmers and ranchers impacted by the drought.”

Farmers, ranchers, and landowners are encouraged to contact their local FSA office with questions.  Additional information is available at

If Using Drought-Damaged Corn for Forage, Make Decision Carefully

Drought, along with hail, wind, heat and other factors, has left some corn yields extremely low across the state. However, damaged corn often can be fed to livestock for forage.

Silage, green chop hay and grazing all can work to help capture the corn crop's forage value for livestock, said Bruce Anderson, extension forage specialist in the Institute of Agriculture and Natural Resources at the University of Nebraska-Lincoln.

However, harvest costs can be high, especially when yield per acre is low, so it's important to carefully evaluate the economics of any salvage operation, he said.

Anderson and UNL Extension educator Tom Dorn recommend taking these preliminary considerations into account:
– If grain prices remain high, grain yield may not need to be very high to justify selecting grain harvest over forage harvest.
– Sometimes leaving the corn residue can result in increased yield next year and that increase may provide more value than that resulting from forage use. See NebGuide G1846, Harvesting Crop Residues, available at or from a local UNL Extension office, for information on evaluating your situation.
– Check labels of all chemicals applied to be sure they are cleared for forage use and that the minimum harvest interval has been met.
– Check with the U.S. Department of Agriculture's Farm Service Agency and your crop insurer to maintain compliance with farm programs and crop insurance requirements.
– Nitrate concentrations can reach toxic levels in weather-damaged corn. The harvest method can affect the nitrate, a particular concern when it's being fed to livestock. Leaving a tall stubble (8 or more inches) will reduce nitrate risk but note eliminate it.

It's important to analyze each harvest method accordingly – making silage, green chop, hay, grazing or windrow grazing, Dorn said.

When it comes to harvest methods, silage may be the safest method of harvest as fermentation usually (but not always) reduces nitrate levels and risk, Anderson said.

While green chop minimizes waste, it may also be the most dangerous way to salvage corn. If present, nitrates will start to change into nitrites (about 10 times as deadly) as green chop begins to heat.

Hay may be the most difficult method of mechanical harvest, especially if ears have started to form – the stalk and especially the ears will be slow and difficult to dry.

Challenges with grazing include acidosis risk for cattle not accustomed to grain if ears have started to fill (smart cows will selectively graze ears), waste from excessive trampling, availability of drinking water, perimeter fencing and nitrates.

NebGuide G1865, The Use and Pricing of Drought-Stressed Corn, available at or from a local UNL Extension office, offers additional information.

Windrow grazing includes cutting as you would for hay and then grazing the windrows rather than baling them. It eliminates the cost of baling, transporting bales or feeding bales. It also eliminates any flexibility in feeding location and may reduce opportunities to sell the corn forage.

Johanns Asks USDA to Sharpen Focus on Drought

Sen. Mike Johanns (R-Neb.), along with five other Senate Agriculture Committee Republicans, wrote Secretary of Agriculture Tom Vilsack urging him to take full advantage of his department’s capabilities in assisting agricultural producers impacted by drought.

“Drought continues to impact an increasing number of producers and virtually every aspect of the agricultural supply chain, including livestock, crops, conservation, and transportation along major waterways,” Johanns said. “I encourage USDA’s response to be swift, efficient, and sharply focused.”

A copy of the letter can be viewed here...

Last Thursday, Johanns wrote Vilsack urging him to allow emergency haying and grazing on Conservation Reserve Program (CRP) lands for the entire state – something Vilsack did this week.

Johanns also launched a page on his Senate website devoted to the drought. The website provides timely updates on drought conditions, actions taken by the state and federal government and a list of agencies that can assist Nebraska ranchers and farmers.

Vilsack will address 25th annual ACE Conference in Omaha August 10

The American Coalition for Ethanol (ACE) announced today that U.S. Agriculture Secretary Tom Vilsack will speak at its ethanol conference on Friday, August 10 in Omaha, Nebraska.

“We are honored to have Secretary Vilsack, arguably the nation’s most effective spokespeople on biofuels, joining us in Omaha for our 25th annual ethanol conference,” said Brian Jennings, Executive Vice President of ACE. “He has a been a true champion for agricultural producers and the ethanol industry during his time as Governor of Iowa and USDA Secretary and we look forward to hearing him discuss the many issues facing our industry.”

The 25th annual ACE ethanol conference will be held at the Hilton in downtown Omaha Wednesday, August 8 through Friday, August 10. More information about the conference is available online at including registration for the event.

Under Vilsack’s leadership, USDA has been proactive in promoting the use of biofuels and installation of blender pumps which enable consumers to have affordable fuel choices at the pump.

Other key topics to be covered at the ACE conference include: Clearing the Air – How Toxic Gasoline Emissions Impact Public Health, Automaker and Ethanol Teamwork on Future Vehicles and Fuels, E15, Ethanol Flex Fuel and the Changing Fuels Marketplace, The ABC’s of E15 and more. Click on the Conference menu heading on to view the full agenda for the event.

As Drought, Heat Show Importance of Risk Management Programs, ASA Calls on House to Pass Farm Bill

As worsening drought conditions continue to envelop more than half of the United States, the American Soybean Association (ASA) is pointing to the Farm Bill currently stalled and awaiting debate by the full House of Representatives as an essential means of ensuring the continued coverage of American farmland through crop insurance and risk management, as well as disaster assistance programs.

“As conditions deteriorate throughout much of rural America and the outlook for farmers becomes bleaker and bleaker, we are reminded that farming is subject to so many elements and risks outside of the farmer’s control. This further emphasizes the need for programs to help farmers manage risks in order to stay viable and plant next year,” said ASA President Steve Wellman, a soybean farmer from Syracuse, Neb.

Currently, 85 percent of soybean acres in the United States are covered by crop insurance, however Wellman says that it should not be misconstrued as a profit center for farmers. “Just as when homeowners insurance replaces valuables following a flood or a fire, crop insurance only covers farmers in the event of a significant loss,” he said. “These policies often have deductibles or loss levels at 25 percent or more. They aren’t there to turn a profit; they exist to help farmers survive and keep farming.”

Wellman added that the current conditions point directly to the benefits provided by revenue-based risk management programs. “Revenue-based risk management tools that complement crop insurance ensure that farmers who suffer a crop loss—and accompanying revenue loss—receive the assistance they need to remain viable,” he said. “In contrast, a target price-based program would provide no assistance to farmers affected by the drought since it would activate only if prices are low and then only on actual production.”

“For these reasons and countless others,” Wellman said, “ASA calls on Speaker Boehner and House leadership to schedule floor time to consider and pass a farm bill so that it can be conferenced with the Senate and a new farm bill can be enacted this year.”

Additionally, Wellman, who is also a cow-calf producer, noted the importance of the bill’s disaster assistance provisions to American livestock producers, who are tied closely to soybean farmers. “Our colleagues in the livestock industry, who depend on soybeans as a steady source of protein-rich feed, are facing an extremely difficult challenge,” he said. “The disaster assistance provisions in the farm bill will provide these key soy allies with the disaster assistance they need this year.”

“The policies that the House and Senate Agriculture Committees worked to include in the farm bill will help farmers deal with the drought, the heat and the galaxy of other real-world risks that agriculture faces,” added Wellman. “It is imperative that the House acts immediately on the farm bill so that these programs can continue to benefit American agriculture.”

USDA Statement Regarding Meatless Mondays

On Wednesday, USDA had received a number of inquiries regarding a rumor that the federal agency was encouraging “Meatless Mondays.” Please find USDA’s statement on this issue below....

“USDA does not endorse Meatless Monday. The statement found on the USDA website was posted without proper clearance and it has been removed.”

NCBA Statement Regarding USDA’s Correction Concerning the Meatless Monday Movement

Subsequent to a news release by the National Cattlemen’s Beef Association (NCBA) condemning a statement by the U.S. Department of Agriculture (USDA) supporting the “Meatless Monday” campaign, USDA publicly stated it does not support the extremist “Meatless Monday” campaign and stated that the statement was posted on its website without the “proper clearance.” NCBA President J.D. Alexander issued the following statement regarding this most recent USDA action.

“We appreciate USDA’s swift action in pulling this disparaging statement off its website. USDA publicly stated today that it does not support this campaign. We appreciate USDA making this right. The agency is important to all cattlemen and women, especially as we face unprecedented challenges, including drought and animal rights extremist groups spreading fiction to consumers who need to know the importance of beef in a healthy diet.

“USDA did right by scrapping this statement and acknowledging the important role of America’s farm and ranch families in providing food for the world. USDA denouncing support of the Meatless Monday campaign is an important step in correcting misinformation about the safety and sustainability of U.S. beef production.”

Cattle Industry Summer Conference Underway

Hundreds of cattle producers are gathering in Denver, Colo., today to help create direction for cattle industry programs at the 2012 Cattle Industry Summer Conference July 25-28. 

More than 650 producers and other industry participants have pre-registered for the event, which includes meetings of the National Cattlemen’s Beef Association (NCBA), Cattlemen’s Beef Board, American National CattleWomen and National Cattlemen’s Foundation. Among the purposes of the yearly conference is to create a framework for both checkoff and policy efforts on behalf of U.S. cattle producers for the 2013 fiscal year, which for NCBA and the Cattlemen’s Beef Board begins Oct. 1.

Keynote speaker at Thursday’s Opening General Session is Dr. Jay Lehr, a futurist in agriculture, who will speak on “Mega Trends in Agriculture: Implications for the Beef Industry.” At Friday’s general session, Cattle-Fax Senior Market Analyst Kevin Good will provide an overview of the cattle market, as well as describe how the drought is affecting the entire industry.

“This year’s summer conference will provide a chance for producers to learn as well as a chance to lead,” according to J.D. Alexander, a beef producer from Pilger, Neb., and NCBA president . “This is definitely a working session at which important strategies for future action are developed.”

Also during General Session II on Friday, W.D. Farr Scholarships will be presented to two graduate students by the National Cattlemen’s Foundation. The $12,000 scholarships are presented to students who want to further their educations in order to pursue careers in meat science and animal agriculture. General Session II is sponsored by Bayer Animal Health.

Joint Committees and Subcommittees will meet on Friday to develop proposals for 2013 checkoff-funded research, education and promotion programs. Also on Friday NCBA policy committees will meet to determine priorities and discuss strategies for the 2013 years. The NCBA Board will hold a session on Saturday, as will members of the Cattlemen’s Beef Board.
“The challenges we face as an industry are sizeable, but our resolve to find solutions is equal to the task,” says Alexander. “I’m proud so many of my fellow producers are joining me in Denver to tackle the work and help assure our potential for future success.”

Farm Rescue Expands into Iowa

Farm Rescue, a nonprofit organization that plants and harvests crops free of charge for farm families facing unexpected crises resulting from major injury, illness or natural disaster, has expanded into Iowa.

"It's always devastating when a family member experiences an unexpected crisis like a severe injury or illness. When a farm family experiences an unexpected crisis it can be even more devastating," said Bill Gross, Farm Rescue founder. "For many farm families, their livelihood relies on a getting their crops planted and harvested in a timely manner. The assistance we provide is beneficial to rural communities and people throughout the United States. Agriculture plays a large role in the economic well-being of our nation. There are 2.2 million farms in the United States. It is our nation's farms which provide the commodities used to produce healthy and nutritious food for everyone in America."

Armed with dedicated volunteer labor and sponsored farm equipment from RDO Equipment Company, Farm Rescue has planted or harvested crops free of charge for nearly 200 farm families facing a crisis situation such as injury, illness or natural disaster in North Dakota, South Dakota, Minnesota and Montana.

"We started helping farmers six years ago because I noticed changing demographics in rural America. Forty or 50 years ago it used to be that neighbors could do all of the work if something happened. Now we're seeing fewer family farms, less children on each farm, and it has simply become harder for neighbors to help one another due to the economic pressures upon their own business operation. Farm Rescue is a structured avenue for farm families to turn for assistance during a time of crisis. Just one injury or illness could be the end of a family farm. That is why Farm Rescue was formed-- to help prevent family farms from ceasing to exist," said Gross, who has been named a CNN hero, featured in People Magazine's "Heroes Among Us," and DirecTV's "Small Town Hero" for his creation of Farm Rescue.

Farm Rescue relies solely on the generosity of its business sponsors, individual donors and grants.

Grower Team Looks at Biotechnology, Trade Agreement Developments

The National Corn Growers Association's Trade Policy and Biotechnology Action Team met last week in Washington for discussions and updates from government and industry experts.  The team addressed issues across biotechnology and trade, in part looking at the multitude of situations in which biotechnology policies, regulations and approvals can impact trade.

"We were very impressed with the perspective the government experts offered into rapidly evolving situations that may affect trade," said Chad Blindauer, team chair and South Dakota grower.  "Our team also appreciated the chance to interact with Argentine corn industry leadership and representation from technology providers. The in-depth look at each facet of the issues facing farmers allows us to form the most solid assessments possible heading into Corn Congress."

Broadening their global perspective of the corn industry, the team met with representatives from MAIZAR, the Argentine trade association representing all aspects of the corn and sorghum value chain. MAIZAR Executive Director Martin Fraguio and President Alberto Morelli spoke with the team on a variety of issues, providing a first-hand analysis of Argentina's corn production and perspective on a variety of issues common between the two countries.

Representatives from the five largest technology providers in corn, BASF, Dow AgroSciences, Monsanto, Pioneer and Syngenta, addressed new products in the pipeline and the regulatory status of new events close to coming to market.

NCGA's Trade Policy and Biotechnology Action Team supports the organization in efforts to maintain and develop grower opportunities by increasing congressional support for NCGA's international trade agenda, increasing funding for market development programs, supporting biotechnology availability, marketability and acceptance around the world while protecting the integrity of U.S. corn and education on these subjects.

"With numerous new products in the pipeline and the Trans Pacific Partnership talks underway, our team faces multiple situations that could impact the profitability of the average grower," Blindauer said. "Drawing upon the deeper understanding we gained this week both through speakers and discussions, we feel ready to tackle these challenges in a thoughtful and comprehensive, yet still energetic, manner."

Weekly Ethanol Production for 7/20/2012

According to the Energy Information Administration data, ethanol production averaged 796,000 barrels per day (b/d) – or 33.43 million gallons daily.  That is down 6,000 b/d from the week before.  The 4-week average for ethanol production stood at 819,000 b/d for an annualized rate of 12.55 billion gallons.

Stocks of ethanol stood at 19.0 million barrels. Gasoline demand for the week averaged 363.7 million gallons daily.

Expressed as a percentage of daily gasoline demand, daily ethanol production was 9.19%. Year-to-date U.S. ethanol export data implies annualized export demand of approximately 900 million gallons.

On the co-products side, ethanol producers were using 12.069 million bushels of corn to produce ethanol and 88,836 metric tons of livestock feed, 79,198 metric tons of which were distillers grains. The rest is comprised of corn gluten feed and corn gluten meal. Additionally, ethanol producers were providing 4.15 million pounds of corn oil daily.

Industry improves biodiesel specifications to meet needs of today's fuels

Fuel quality and a strong set of standards remain one of the highest priorities for the biodiesel industry. That is why the industry continues to refine the ASTM biodiesel specifications to meet the needs of customers with Ultra-Low Sulfur Diesel (ULSD) and new diesel engine and after-treatment technology. A new voluntary No. 1-B grade for biodiesel (B100) passed the ASTM D2 Committee on Petroleum Products and Lubricants this past spring and the results were sanctioned by the ASTM Committee on Standards in a meeting held late last week.

“The biodiesel industry took a proactive stance to improve the standards governing America's Advanced Biofuel,” said Joe Jobe, CEO of the National Biodiesel Board. “For the large majority of biodiesel users, the current standard along with conventional industry management practices allow for biodiesel blend use year-round, even in extreme climates.” ASTM D6751, the ASTM standard for pure biodiesel (B100) prior to blending, was modified to create a new voluntary No. 1-B grade. The new grade provides more stringent controls for minor components in raw materials used to make biodiesel, such as vegetable oils and animal fats. The specification values of the current standard will become the No. 2-B grade in D6751 without change. Producers or blenders can continue to utilize the current specification under the No. 2-B grade at any time of the year exactly as done today, or they may opt to use the more stringent No 1-B grade. The finished blended fuel standards—D975 for on/off road diesel up to 5% biodiesel (B5), D7467 for B6-B20 on/off road applications, and D396 for heating oil up to 5% biodiesel—do not change. B100 used for D975, D7467, and D396 must continue to meet D6751 (either the No. 1-B or the No. 2-B grade) prior to blending.

The choice of the No. 1-B and No. 2-B designations were selected to make the standard as similar as possible as the current mode of operation with No. 1 and No. 2 diesel fuel. Most users utilize No. 2 diesel fuel, but if they experience un-expected filter clogging they can switch to No. 1 diesel fuel, use additives or other means to prevent un-expected filter clogging. The same philosophy is to be maintained with the No. 1-B and No. 2-B biodiesel specification, i.e. most users will continue to utilize the No. 2-B biodiesel but if un-expected filter clogging is experienced, No. 1-B can be used for blending.

The interest in creating No.1-B specification was triggered by a handful of cases with the new Ultra Low Sulfur Diesel fuel experiencing un-expected filter clogging above the cloud point of the finished blend, which mostly occurred with low aromatic No. 1 type diesel blends. The voluntary No. 1-B grade maintains the same parameters as the current standard, and provides more stringent controls for minor components which have been implicated in rare filter clogging in the field with ULSD. Monoglycerides were chosen as a surrogate for all minor components and are limited in the new No. 1-B grade to 0.40% mass maximum, and the Cold Soak Filtration Time is limited to 200 seconds year around.

“We are committed as an industry to being proactive so that the end user gets the best product possible,” said Kyle Anderson, Technical Projects Manager for the National Biodiesel Board. “As part of our on-going commitment to improving the standards and fuel quality, we will continue to investigate these rare phenomena and may propose further changes over time as more data and improved test methods become available. Biodiesel is one of the most tested fuels in the world, and that’s why customers can have confidence in biodiesel blends with ULSD and new diesel engines and after treatment technology moving forward.”

The No. 1-B specification passed the ASTM D2 Main Committee on Petroleum Products and Lubricants via electronic ballot adjudication of negatives from the December 2011 ASTM D2 meeting. The handling of the negatives was reviewed and approved by the ASTM Committee on Standards at a meeting late last week. The modified version of ASTM D6751 containing the new No. 1-B grade will be released for public use later this summer after editorial review and typesetting.

Ag Prices Won't Hike Inflation

The drought in parts of the U.S. farm region has caused prices for commodities including corn, wheat and soybeans to jump this summer. But the rise in farm prices won't have anywhere near the negative impact on consumer inflation that would come from a similar gain in oil.

That's because, as UBS economist Paul Donovan says, "food really isn't 'food'." Much of the food purchased in developed nations has gone through some form of processing, he points out. This and other factors including marketing and distribution add to the final price tag. As a result, food's retail prices aren't wholly determined by farm prices.

In the U.S., farmers get only about 50% of the retail price of butter and a mere 7% for baked goods, according to U.S. Department of Agriculture data.

In comparison, 68% of the 2011 retail price of gasoline was influenced by the market price of crude oil, as calculated by the Energy Information Administration.

Plus, an increase in the cost of oil quickly translates into higher prices at the gas pump. Economists at Capital Economics say it can take up to nine months for increases in agricultural commodity prices to show up in prices at the grocery store.

But they say any inflation impact is small. If agricultural prices were to remain at current high levels, the Capital economists estimate consumer food inflation would rise from 2.7% in June to around 4.5%. Given food's small share of the top-line consumer price index, the rise "would add just 0.3 percentage point to overall CPI inflation," they write.

If no other price pressures build, future inflation would remain close to the Federal Reserve's 2% target rate.

Perhaps the bigger worry in the food price outlook is the possible impact on foreign wages. Food makes up a much larger share of total inflation in emerging economies. If businesses in emerging markets have to make higher cost-of-living pay increases to their workers, higher labor costs might lift prices of imports coming to the U.S.

That hasn't shown up in the import price data yet, but a persistent uptrend in global food prices could change the dynamic.

Agriculture and Energy Departments Announce New Investments to Drive Innovations in Biofuels and Biobased Products

As part of the Obama Administration's all-of-the-above strategy to enhance U.S. energy security, reduce America's reliance on imported oil and leverage our domestic energy supply, while also supporting rural economies, the U.S. Departments of Agriculture (USDA) and Energy today announced a $41 million investment in 13 projects that will drive more efficient biofuels production and feedstock improvements.

"If we want to develop affordable alternatives for oil and gasoline that will help reduce our dependence on foreign oil, we need investments like these projects to spur innovation in bioenergy," said Agriculture Secretary Tom Vilsack. "By producing energy more efficiently and sustainably, we can create rural jobs, boost rural economies and help U.S. farmers, ranchers and foresters prosper."

"As part of President Obama's all-of-the-above strategy to deploy every available source of American energy, we continue to strive for more efficient, cost-competitive technologies to produce U.S. energy," said Energy Secretary Steven Chu. "The investments announced today are helping to accelerate innovation across America's growing biofuels industry, which will help to reduce our dependence on imported oil and support job creation across rural America."

New Biomass Research and Development Initiative Investments

Through the joint Biomass Research and Development Initiative (BRDI), USDA and the Energy Department are working to develop economically and environmentally sustainable sources of renewable biomass and increase the availability of renewable fuels and biobased products. The five projects announced today will help to diversify the nation's energy portfolio and replace the need for gasoline and diesel in vehicles.

The cost-shared projects include:
-    Quad County Corn Cooperative ($4.25 million – Galva, Iowa). This project will retrofit an existing corn starch ethanol plant to add value to its byproducts, which will be marketed to the non-ruminant feed markets and to the biodiesel industry. This project enables creation of diverse product streams from this facility, opening new markets for the cooperative and contributing to the U.S. Environmental Protection Agency's goals for cellulosic ethanol production and use.
-    Agricultural Research Service's National Center for Agricultural Utilization Research ($7 million - Peoria, Illinois). This project will optimize rapeseed/canola, mustard and camelina oilseed crops for oil quality and yield using recombinant inbred lines. Remote sensing and crop modeling will enhance production strategies to incorporate these crops into existing agricultural systems across four ecoregions in the Western United States. The oils will be hydrotreated to produce diesel and jet fuel.
-    Cooper Tire & Rubber Co. ($6.85 million - Findlay, Ohio). Guayule is a hardwood perennial natural rubber-producing shrub grown in the semi-arid southwestern United States. This project will optimize production and quality of guayule rubber using genomic sequencing and development of molecular markers. The extracted rubber will be used in tire formulations, and the remaining plant residue will be evaluated for use in biopower and for conversion to jet fuel precursors.
-    University of Wisconsin ($7 million - Madison, Wisconsin).This project will utilize dairy manure as a source of fiber and fertilizer. Fiber will be converted to ethanol, manure used for fertilizer, and oil from the crops will be converted to biodiesel used in farm equipment. The project goal is to develop closed-loop systems with new product streams that benefit the environment.
-    University of Hawaii ($6 million - Manoa, Hawaii). This project will optimize the production of grasses in Hawaii, including napier grass, energycane, sugarcane and sweet sorghum. Harvest and preprocessing will be optimized to be compatible with the biochemical conversion to jet fuel and diesel.

Leveraging Genomics for More Efficient, Cost-Effective Bioenergy

Today, the Energy Department and USDA are also announcing $10 million for eight research projects aimed at applying biomass genomics to improve promising biofuel feedstocks and drive more efficient, cost-effective energy production. These projects will use genetic mapping to advance sustainable biofuels production by analyzing and seeking to maximize genetic traits like feedstock durability, how tolerant feedstocks are to various environmental stresses, and the potential for feedstocks to be used in energy production.

The projects selected today include:
-    Michigan Technological University ($1.1 million – Houghton, Michigan). This project will analyze genetic traits that affect wood biomass yield and quality in the Populus species, including poplar trees.
-    Iowa State University ($1.4 million - Ames, Iowa). Research will explore the genetic architecture of sorghum biomass yield component traits identified using field-based analysis of the feedstock's physical and genetic traits.

Since 2006, the Plant Feedstocks Genomics for Bioenergy research program has invested nearly $70 million helping to identify key genes affecting biomass yield and quality in feedstocks and to accelerate breeding efforts to improve bioenergy-relevant traits.

USDA Reminds Producers of Approaching Deadline for FSA County Committees Nominations

Farm Service Agency (FSA) Administrator Juan M. Garcia today reminded farmers, ranchers and other agricultural producers that they have until Aug. 1, 2012, to nominate eligible candidates to serve on local FSA county committees.

“The last day to file your nomination form is about a week away," Garcia said. "Please get involved this year and nominate the candidate of your choice, or nominate yourself to serve on your local county committee. This is your opportunity to have a say in how federal programs are delivered in your county.”

FSA county committees help local farmers through their decisions on commodity price support loans, conservation programs and disaster programs, and by working closely with county executive directors.

To be eligible to hold office as a county committee member, individuals must participate or cooperate in a program administered by FSA, be eligible to vote in a county committee election and live in the local administrative area where they are running. A complete list of eligibility requirements, more information and nomination forms are available at

All nominees must sign the nomination form FSA-669A. All nomination forms for the 2012 election must be postmarked or received in the local USDA Service Center by close of business on Aug. 1, 2012. Ballots will be mailed to eligible voters by Nov. 5 and are due back to the local USDA Service Centers on Dec. 3. The newly elected county committee members will take office Jan. 1, 2013.

Goodyear to Use Soybean Oil to Reduce Petroleum in Tire Production

The Goodyear Tire & Rubber Company announced a development that could help consumers and the environment by reducing the amount of petroleum-based oil used in tires, while at the same time, extending tread life. Researchers at the company's Innovation Center here have found in their tests that using soybean oil in tires can potentially increase tread life by 10 percent and reduce the tiremaker's use of petroleum-based oil by up to seven million gallons each year.

In addition, testing at Goodyear's tire plant in Lawton, Oklahoma showed improved mixing capabilities in the manufacturing process. The company found that rubber compounds made with soybean oil blend more easily with the silica used in building tires.

This can improve plant efficiency and reduce energy consumption and greenhouse gas emissions.

"Goodyear is committed to caring for the environment and communities, and use of soybean oil is proving to be another way to accomplish this goal," said Jean-Claude Kihn, Goodyear's chief technical officer. "Consumers benefit through improved tread life, Goodyear gains with increased efficiency and energy savings and we all win whenever there is a positive impact on the environment."

Prototype tires built in Lawton will be tested at Goodyear's Proving Grounds in San Angelo, Texas in the coming months.

If indicators remain positive, Goodyear expects consumers will be able to purchase tires made with soybean oil as early as 2015.

The United Soybean Board is helping fund the Goodyear project with a grant of $500,000 over two years.