Friday June 2 Ag News

FCSAmerica Survey Provides Insight into Farmer Grain Marketing Practices

Farm Credit Services of America (FCSAmerica), a financial cooperative owned by agricultural producers, today announced results of a survey it commissioned on the marketing practices of farmers across the Corn Belt. The results shed light on the practices used by grain producers who say they are satisfied with their marketing results, and offer an opportunity for farmers to compare themselves to their peers and examine their own approach to marketing.

Nearly 650 producers in nine states answered questions about how and when they price their crops. At a time when many farmers have worked to lower their operating costs, the survey offers insights about how to optimize the income side of the farm balance sheet.

"The survey results highlight that knowing cost of production is the foundation of sound marketing," said Doug Stark, president and CEO at FCSAmerica. "They also highlight the important role that crop insurance plays in supporting both risk management and marketing, not just when there is a crop failure."

Among the findings:
-    One-third of producers are mostly or completely satisfied with their marketing practices and results.
-    Satisfied marketers are more likely to price as soon as the market offers a profit and to price multiple crop years. They are less likely to sell most of their crop right after harvest or to price based on market fear or cash flow needs.
-    More satisfied than dissatisfied marketers report that they have a good understanding of their cost of production and use it to set an initial price goal. Satisfied marketers are more likely to have written marketing plans.
-    On average, producers use four to five marketing tools, the most popular being storage. Eighty-two percent store grain at least occasionally; one in five always stores.
-    Operations of 1,000 or more acres and growers with higher levels of crop insurance employ a fuller range of marketing tools. Producers with Revenue Protection of at least 80 percent also are more likely to price prior to harvest.
-    More than two-thirds use cash forward contracts and spot cash sales, while only a quarter of respondents use futures or options.
-    Those 35 and younger are more likely to use hedge-to-arrive contracts and lock in the carry when they store. Younger and larger operators are more likely to use their cost of production to set a marketing price.

USDA reports on grain sales are focused on deliveries to elevators. The FCSAmerica survey focused directly on producers with 350 acres or more of corn, soybeans and/or wheat to learn how they actually price their grain. The results reveal how farmers view risk, the pricing strategies they employ, and the factors that influence their marketing attitudes and practices.

Ted Schroeder, an agricultural economist and director of the Center for Risk Management Education at Kansas State University, assisted with survey design and interpretation of results.

FCSAmerica provides credit and crop insurance services for more than 50,000 customer-owners in Iowa, Nebraska, South Dakota and Wyoming. "We don't advise producers on their marketing strategies, but as a farmer-owned cooperative, we continually invest in helping our customers enhance their financial acumen to benefit their operations," Stark said.

To view the full survey report, visit fcsamerica.com/GrainMarketingInsights.



NEBRASKA GRAZING CONFERENCE
Bruce Anderson, NE Extension Forage Specialist

            Is placement of cross fences and water points preventing you from taking full advantage of the potential benefits of rotational grazing?  Get the answers at the Nebraska Grazing Conference in Kearney on August 8 and 9.

            Jim Gerrish, internationally respected grazing expert and developer of the Management Intensive Grazing (MIG) method, will share his insights into fence and water development during his keynote presentation and informal evening workshop.  Then Craig Derickson and Brad Soncksen from NRCS will describe cost share programs to help you pay for these improvements.

            Livestock profits from grazinglands are increasingly hard to come by.  Cattlemen John Maddux from Wauneta and Jim Jenkins from Calloway will describe ways they have adjusted their operations to find economic opportunities while Aaron Berger and Jay Parsons from Nebraska Extension will examine ways to control costs and risk.  Nancy Peterson from Gordon will describe the many varied ways her family have used diversity and stewardship to build their cow herd and soil.

            Peter Ballerstedt with Barenbrug USA will describe cool-season grasses to plant in new pastures as well as show how grass and cattle combine to form healthy human diets.

            Wildlife thrive on well-managed grazinglands.  Learn how this is being accomplished in Nebraska, South Dakota, and Oklahoma from Bill Vodehnal, Patricia Johnson, and Dwayne Elmore.

            Learn how to look at weedy plants from a different perspective with Chris Helzer of The Nature Conservancy.

            Full registration for both days is $80 before August 1 and $100 thereafter.  Student and single day registrations are available.  Full conference information and registration are available on-line at http://grassland.unl.edu/current-conference. 



Iowa Farm Bureau sees valuable information for farmers in 2016 Impaired Waters Report

The recent Iowa Department of Natural Resources (DNR) report shows a narrowing in the number of impaired waters in Iowa with the latest report showing a 1.9 percent increase in the number of “impaired waterbodies.”  DNR staffers who prepared the report say that the DNR is now utilizing new, interactive assessment tools such as the one developed by the U.S. Geological Survey (USGS) which tracks long-term trends in surface water quality.

Iowa Farm Bureau Federation (IFBF) Environmental Policy Advisor Rick Robinson says this year’s report is notably different because this goes above and beyond requirements of the EPA and includes different types of measurements and data pulled from multiple sources.  “The goal is one all Iowans share: to see changes in the quality of water in rivers and streams.  By tapping into the USGS information base, we can see changes that have occurred over the four decades since the passage of the Clean Water Act in 1972.  The many thousands of readings show impaired waterbodies are leveling off to a 1.9 percent increase.  The goal shared by farmers, environmentalists and lawmakers is to see it reach zero and stay there,” says Robinson.

Another significant point in the 2017 report: 56 impairments have been taken off the ‘impaired waterbodies list.’  IFBF credits record conservation practices and collaborative work for the progress.  The USGS data shows nitrate levels are trending steady to lower in 18 of 22 Iowa sites tested; phosphorus levels are trending steady to lower in 23 or 25 sites tested and only five Iowa sites showed up as ‘somewhat likely up’ for either nitrates or phosphorus.  “It’s also worth noting that 75 percent of untreated water in Iowa streams meets or exceeds the EPA’s nitrate safety standard,” says Robinson.

Farmers are adding conservation practices in record numbers, for example, planting 630,000 acres of cover crops last year, compared to 10,000 acres in 2009.   “Cover crops are just one of many practices outlined in the Iowa Nutrient Reduction Strategy and embracing those options requires commitment to the big picture, since meeting the 45 percent reduction targets in nitrates and phosphorus is estimated to take $1.2-4 billion per year.  Funding is an important aspect to continued water quality progress,” says IFBF President Craig Hill.   “Iowa farmers embrace the challenge of improving water quality so the work can and must continue.”



AgGateway's Ag Retail eConnectivity Seminar June 13

Part of AgGateway's Mid-Year Meeting, June 12-15, in Altoona, Iowa will be as half-day Ag Retail eConnectivity Seminar, an introduction to the many benefits of electronic connectivity for agricultural retailers and service providers. It will be held June 13 from 10 a.m. to 3 p.m. Register at aggateway.org/Events/2017Mid-YearMeeting.aspx and choose to attend the entire Mid-Year Meeting for $150, or just the Ag Retail Seminar for $50.

Participants will learn about the value and competitive advantages of seamless electronic data exchange. Some of the topics and speakers will include:
- Networked Agriculture - Jeremy Wilson, Crop IMS
- What is eConnectivity and Why Should I Care? - Randy Beard, River Valley Cooperative; Jeff Griffeth, Co-Alliance LLP
- What Does it Take to Achieve Connectivity? - Randy Fry, Ceres Solutions
- Ability and Flexibility - Knowing Your Needs and Limits - Brian Gates, Key Cooperative; Scott Meredith and Eric Hoefing, ACS
- Who Can Help Me? - Jody Costa, Barcoding Inc.
- eConnectivity Matters Now - Daren Coppock, Presid ent & CEO, Agricultural Retailers Association
- Panel Discussion: Why My Company Chose Connectivity - Natasha Lily, The Equity; Ann Vande Lune, Key Cooperative; Chuck Bohanon, AgVantage Software; Pat Johnson, Crop Production Services

AgGateway is a non-profit organization that helps member companies improve their profitability and productivity by promoting, enabling and expanding eBusiness in agriculture. www.AgGateway.org.



Fear of massive cuts to essential farm safety net programs feature topic at Iowa Farm Bureau's Economic Summit

As farmers enter a fourth year of a downturned ag economy, any proposals calling for cuts to the essential farm safety net send waves of fear through the rural countryside.  A recent federal budget proposal from the Trump Administration would cut $39 billion from farm safety net programs during a critical time for farmers struggling to operate in the black.  Iowa Farm Bureau’s 2017 Economic Summit; “Overcoming Challenges, Creating Opportunities,” on July 20 at the Iowa State Scheman Center in Ames is designed to help farmers manage and strategize during this tumultuous time for agriculture.

Farmers have faced a 46 percent drop in farm income over the past three years following the 2014 farm bill, and bearish commodity markets, uncertainty with trade deals, and proposed slashes to critical crop insurance programs are causing many concerns for Iowa farmers.

“Managing risk is what keeps Iowa farms sustainable through a prolonged downturned farm economy, and these proposals call for drastic reductions that could, if enacted, devastate crop insurance and conservation programs,” says Iowa Farm Bureau Federation (IFBF) President Craig Hill.  “As I visit with farmers around Iowa, they tell me crop insurance is vital for their success, and they certainly don’t want to jeopardize the gains we have been able to make in conservation.  Budget proposals that hamper farm safety net programs, impact conservation programs, and negatively impact rural economic development programs are especially worrisome and will be addressed in detail during our Economic Summit.”

As federal budget negotiations get underway in Washington, D.C., farmers are paying close attention to the early field hearings for the new farm bill and potential outlines of the 2018 farm bill, which will establish the essential farm safety net for farmers in the coming years.

Pending trade negotiations with the potential for significant impacts to Iowa agriculture is also a top-of-mind concern for farmers as they consider crop and livestock marketing decisions.  Speakers during this year’s Economic Summit will discuss the benefits of trade for Iowa agriculture and the status and outlook for ag exports to provide farmers insights and strategies for managing through this downturned economic period.

“This is a challenging time for farmers given extremely tight margins and an uncertain future for trade and the 2018 farm bill,” said Dave Miller, IFBF director of research and commodity services.  “We want to ensure our Economic Summit helps attendees understand the key economic factors at play and help farmers identify opportunities to earn a premium price for their crops and livestock, or ways to their production costs and improve their bottom lines.”

Iowa Farm Bureau members who attend the full-day summit will benefit from the expertise of Iowa-based and national experts presenting on a range of subjects and issues critical to agriculture today, including economist David Oppendahl of the Federal Reserve Bank of Chicago; John Newton, an AFBF economist; and Jim Knuth, Iowa-based senior vice president of the Farm Credit Services of America.

This year’s summit will also feature breakout sessions that allow attendees to dive deeper into a range of topics from soil health and cover crops and opportunities in livestock production to ways to build landlord-tenant relationships and trends in the farm machinery markets.  

Summit registration, which includes access to all presentations and lunch, is $30 for Farm Bureau members and $75 for non-members before July 11.  Visit www.iowafarmbureau.com. 



U.S.-VIETNAM MEETING YIELDS PROGRESS ON KEY U.S. PORK TRADE ISSUES

Following a meeting between President Trump and Vietnamese Prime Minister Nguyễn Xuân Phúc, the two countries on Wednesday announced plans to enhance political, diplomatic, economic and trade relations. Among the topics addressed directly with Vietnam’s prime minister were two key trade access issues for U.S. pork: the use of veterinary drugs and offal exports.

Regarding veterinary drugs, Vietnam will not be issuing a circular, previously announced, implementing a zero-tolerance policy on residues for multiple veterinary drug, many of which are used in U.S. pork production. It agreed to follow U.S. food safety standards and maximum residue limits (MRLs) set by the U.N.’s Codex Alimentarius Commission. Vietnam will continue to allow U.S. imports of beef and pork that meet Codex MRLs. The policy aligns with U.S. food safety concerns.

In addition, Vietnam said it is committed to working with the United States to address issues currently preventing the importation of white offal.

Earlier in the week, U.S. Trade Representative Robert Lighthizer touted “significant trade progress” underway between the United States and Vietnam at a U.S. Chamber of Commerce dinner attended by the prime minister. Lighthizer added: “Over the last decade, our bilateral trade deficit has risen from about $7 billion to nearly $32 billion. This concerning growth in our trade deficit presents new challenges and shows us that there is considerable potential to improve further our important trade relationship.”



Senator Thune Introduces ARC Payment Legislation

Senator John Thune (R-SD) has introduced legislation intended to improve the Agriculture Risk Coverage (ARC) Program. In an attempt to fix the county disparity issue present in ARC, Senator Thune is proposing that all ARC County payments be calculated using the payment rate for the county in which the land is physically located.

Currently, ARC participants with farms in multiple counties may choose to receive the payment rate for the county in which the land is physically located or the payment rate of the administrative county.

Senator Thune’s proposal would also require a mandatory base reallocation determined by planted and considered planted acres on a farm for the years 2014-2017. Past efforts to force a mandatory base update have been rejected as an assault on the planting flexibility that was first created under the 1996 Farm Bill and maintained ever since.



Apply Now for the 2017-18 ASA DuPont Young Leader Program

The American Soybean Association (ASA), DuPont Pioneer and DuPont Crop Protection are seeking applicants for the 2017-18 ASA DuPont Young Leader Program (DYL).

For more than 30 years, the ASA DuPont Young Leader program has identified and developed grower leaders who have shaped the agricultural industry.

“The ASA DuPont Young Leader Program has had a tremendous impact on not only the soybean industry, but all of agriculture. Since the program’s inception in 1984, it has recognized the value gained from engaging and encouraging a diverse agricultural leadership which includes farmers – both men and women. Through participation in this state-of-the-art training program, growers are able to realize their leadership potential while creating meaningful relationships that lead to increased collaboration that influences the industry,” said ASA President Ron Moore, a farmer from Roseville, Ill. “We can’t thank DuPont Pioneer and DuPont Crop Protection enough for their longstanding support of the program.”

The ASA DuPont Young Leader program is a challenging and educational two-part training program. Phase I of the 2017-18 program will take place at the DuPont Pioneer headquarters in Johnston, Iowa, Nov. 28-30, 2017. The program continues Feb. 25-28, 2018 in Anaheim, Calif. in conjunction with the annual Commodity Classic Convention and Trade Show.

“The ASA DuPont Young Leader program opened my eyes to the diversity and complexity that is found within our agriculture today," said Monica McCullough, 2017 DuPont Young Leader alumni. "The leadership development and personal connections that have occurred during this program have given me the skill set to authentically engage with others and to share our story about agriculture in a way that is welcoming to all. This is an industry were very few people shoulder the responsibility of feeding so many, with that being said, we all have a responsibility to engage in the ways in which our time and talents allow. The ASA DYL program has helped me on my journey of finding my role within agriculture."

Soybean grower couples and individuals are encouraged to apply for the program, which focuses on leadership and communication, the latest agricultural information and the development of a strong peer network. ASA, its 26 state affiliates, including the Grain Farmers of Ontario and DuPont, will work together to identify the top producers to represent their state as part of this program.

“America’s farmers provide the strongest voice for, not only agriculture, but also for rural America. We are proud to support the young leader program, which is developing the next generation of grower leaders and advocates for U.S. agriculture,” said Randy Wanke, sr. manager industry relations, DuPont Pioneer.

Applications are being accepted online now. Interested applicants should click www.soygrowers.com for additional program information and to apply.



Grain Barge Tonnages Drop in May Due to High Water

Persistent rainfall throughout the spring has caused high water conditions that have slowed and sometimes halted navigation on portions of the nation's inland waterways. As of May 31, there are no lock closures due to high water levels. Grain barge traffic for May on the Upper Mississippi, Ohio, and Arkansas Rivers was 2.8 million tons, 16 percent lower than the 3-year average for May.

However, even with the less-than-ideal navigation conditions, current spot barge freight rates for export grain at principle origins remain 1 to 17 percent below the 3-year average for the end of May.

The Lower Mississippi River is also experiencing high water conditions causing daylight only transit in certain areas.

Repair work that was scheduled to begin in early June at La Grange Lock on the Illinois River has been postponed until the water level on the river recede.

When the La Grange repair work begins, the lock will be closed for 10 hours each day and opened to traffic for 14 hours each day, until the repairs are finished.




US Ethanol Exports Down 32% in April

U.S. ethanol exports in April dropped 32% to 87.2 million gallons from March, an eight-month low, the Renewable Fuels Association stated in a news release Friday, basing their findings on government data.

Despite the slowdown in April, RFA, an ethanol trade association, said U.S. ethanol exports remain on a record pace with 474.8 million gallons of shipments over the first four months of 2017.

Brazil accounted for a little more than half of U.S. ethanol exports in April, receiving 44.5 million gallons to remain the top destination for U.S. ethanol exports.

In April, Canada received 19.0 million gallons of ethanol, Peru 3.9 million gallons, the United Arab Emirates 3.3 million gallons, and South Korea with 2.5 million gallons.

"Noticeably absent from the April roster were India and the Philippines. Together, the two counties imported more than 50 mg of U.S. ethanol in March, and India had been the third-leading market for U.S. export in the first quarter," said RFA.



ADM Expanding Mill Capacity

Archer Daniels Midland announced plans Friday to build a new flour mill in Mendota, Illinois, and end flour production at an older mill in Chicago.

ADM said the new, high-capacity mill will allow the company to continue to meet growing demand for flour throughout the Midwest. The new mill will tie into ADM's current grain operations in Mendota, which is about an hour outside of the Chicago metro area. Building near the current grain facility will allow the flour mill to take advantage of the rail access there, the company stated.

"ADM's new facility in Mendota will help us provide additional capabilities to meet ongoing demand growth in the Midwest, where we are seeing bakers expand their production capabilities," said Mark Kolkhorst, president, ADM Milling. "In addition, our new mill will enable us to drive efficiencies, thanks to the use of new technologies and equipment, and the ability to leverage capabilities of ADM's existing grain facility in Mendota -- such as unloading 110-car shuttle trains."

The new facility will have daily milling capacity of 30,000 cwt and will grind both soft and hard red wheat varieties. ADM stated the new Mendota facility will begin operations in mid-2019. Once fully operational, ADM will end production at a smaller wheat mill in Chicago.

ADM did not state the construction costs for the new flour mill, but the company stated in a news release that ADM has now announced projects totaling more than $250 million in Illinois, including the mill, new animal nutrition facilities in Effingham and Quincy, and the company's partnership with DuPont Industrial Biosciences to produce furan dicarboxylic methyl ester (FDME) from fructose.