Wednesday August 21st Ag News - Pro Farmer Crop Tour Info

 Pro Farmer Pegs NE corn yield at 173bu/acre, soybean pods up 1%

Nearly 50 scouts on the western leg of the Pro Farmer Crop tour spend the day Tuesday scouting and gathering data across 4 routes in Nebraska.  Then at the end of the day, Pro Farmer released their estimates for 2024 in Nebraska.  Scouts gathered hundreds of samples in corn and soybeans.  Last night, after crunching the data, Pro Farmer released a Nebraska corn yield estimate of 173.25 bu/acre, which is about 3.6% or 6 bushels an acre higher than last year's average, and it's about 2.3% or 4 bushels an acre higher than the 3 year average.   

On soybeans, they estimate the average number of pods in a three foot by three foot area...  that number for 2024 was 1172.5, up 12 pods or 1% from last year's estimate and up about 22 pods, or  just shy of 2%, from the three year average.  

The western leg of the Pro Farmer Crop Tour will spend day three Wednesday scouting fields and collecting data across western Iowa, stopping in Spencer this evening.  



When should farmers and ranchers start tax planning?
Bethany Johnston, Nebraska Extension Educator

Does it seem too early to start planning for taxes?

Even though calves await weaning, and crops still stand in the fields, September and October are excellent times to meet with your tax accountant and start looking ahead for tax purposes.

Pre-tax planning allows producers to plan for upcoming income and expenses. Make or hold off on major equipment purchases, sell or wait to sell livestock and crops—pre-tax planning will help avoid unforeseen tax implications of your decisions.

What should you do when planning a pre-tax meeting with your tax accountant?
-    Start early. Set an appointment with your accountant. September and October will allow for time to make end-of-the-year decisions. Planning in advance is an advantage for cattle producers, where livestock are not as easy as crops to sell quickly, if needed, and sale checks are sometimes larger.
-    Come prepared. Get your books up to date and bring these to your pre-tax meeting. Email your tax accountant any reports for the year. Electronic bookkeeping programs, like Quickbooks and Quicken, have templates for reports, or you can create a custom report, and share information in Excel or PDF form.
-    Look ahead. What are estimated future expenses? Will any additional income come in before December 31?
-    Did you purchase or trade any equipment? Bring the purchase agreements/trade papers for this year’s equipment purchases.

After reviewing the numbers, if your operation has a surplus, what sound business decisions can you make with the profit?
-    Estate and transition planning for your operation. Some of your attorney’s fees may qualify as tax-deductible expenses.
-    Maintenance and repairs. Schedule a time before the end of the year to repair equipment, buildings, pivots, or make land improvements, such as fence, new tanks or stock wells, or control invasive species.
-    Pay down debt, with a plan. According to Tina Barrett, Executive Director of the Nebraska Farm Business Inc, “excess funds are tricky.”  To have extra cash to pay down debt, you need taxable income. “But if someone takes $100,000 and pays down a land note, they may get to the end of the year and realize their taxable income is $100,000 higher than usual. It is not a pleasant surprise, when there is no money to pay expenses,” explains Barrett.  Every situation is different, so ask your accountant about your position.
-    Do not spend money on tax deductible expenses, just to reduce tax payments. “If you didn’t spend that $100,000 on stuff that’s not needed, and if instead, you could have spent $30,000 on taxes and $70,000 to reduce debt you would be further ahead financially,” Barrett comments. Again, each tax situation is unique, so ask what works best for your operation.

Ask your accountant how hard it has become, or if it’s still a good plan, to try and meet the March 1 deadline to submit taxes for agricultural producers. An alternative is to make an estimate by January 15, pay the estimate, then producers have until April 15 to file and pay the difference. This can be beneficial with late information, or if income is higher this year than the previous year.

With weaning and harvest around the corner, take the time to prepare and set up a pre-tax planning appointment with your tax account.



USDA to measure small grain production

Starting in late August, a sample of producers around the country will receive Agricultural Survey questionnaires from the U.S. Department of Agriculture’s National Agricultural Statistics Service (NASS). The agency is taking a comprehensive look into the 2024 production and supply of small grains, including wheat, oats, barley, and rye.

NASS will contact more than 2,700 Iowa producers to determine 2024 acreage, yield, and production for small grain crops. Additionally, NASS will survey commercial grain storage operations to determine estimates of grain stocks stored in any off-farm facility. The data help the industry evaluate export potential and calculate the supply of crops available for the marketing year.

Producers can respond to the Agricultural Survey online at agcounts.usda.gov, by phone, or mail. Producers who have not responded by August 29 may be contacted by a NASS representative to schedule a time to help fill out the survey.

“NASS safeguards the privacy of respondents by keeping all individual information confidential and publishing the data in aggregate form only to ensure that no operation or producer can be identified,” said Thessen. “We recognize that this is a hectic time for farmers, but the information they provide helps U.S. agriculture remain viable and capable. I urge them to respond to these surveys and thank them for their participation.”

NASS will publish state and national data in the annual Small Grains Summary and quarterly Grain Stocks reports Monday, September 30 on the NASS website. These survey data also contribute to USDA’s World Agricultural Outlook Board’s monthly World Agricultural Supply and Demand Estimates.



Union Pacific Cultivates Growing Relationship with Heartland Co-op

The strength of Union Pacific’s franchise and its focus on operational excellence led to a new Heartland Co-op grain shuttle facility being built on the Union Pacific network in Millerton, Iowa.

The partnership will provide farmers greater access to key markets.

“We appreciate Heartland Co-op investing in our railroad for the long term,” said Ryan Raess, general director, Marketing and Sales. “This enables us to support the growing market in south-central Iowa and strengthen our grain origination base.”
Heartland Co-op Aerial Shot | M

Heartland Co-op’s new grain shuttle facility underway in Millerton, Iowa.

The new grain elevator is expected to be operational by late 2025 or early 2026.

“Heartland Co-op is a great customer and partner with Union Pacific,” said Emily Peters, manager, Marketing and Sales. “We’re looking forward to continuing to grow together.”

Several Union Pacific teams are collaborating on this project to ensure Heartland Co-op can begin shipping from the new site as soon as possible, including Operating, Marketing and Sales, Service Design, Network Economic and Industrial Development, Real Estate, and Public Projects.

“We’re excited to develop this project alongside Union Pacific,” said Tom Hauschel, CEO and general manager of Heartland Co-op. “Union Pacific’s trust in our ability to create a state-of-the-art facility and be a strong long-term partner is greatly appreciated.”
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Looking ahead to the 2024 grain season, Union Pacific spends months planning and preparing for the harvest, which is expected to produce a large crop this year. The team tracks global commodity markets, meets frequently with customers to gauge market demand and harvest outlooks, and makes annual adjustments for supply-and-demand variables driven by weather, growing conditions, government policies and world grain production.

“We’re having frequent conversations with our customers and internal stakeholders to deliver a strong service product for the 2024 harvest,” Raess said.

Union Pacific transports about 1.3 billion bushels of grain annually, with exports accounting for 30% to 40% of those shipments. The railroad serves most of the U.S. major grain markets, connecting the Midwest and Western production areas to export terminals in the Pacific Northwest and Gulf Coast, as well as Mexico. Union Pacific also serves significant domestic markets, including grain processors, animal feeders and ethanol producers in the Midwest and West.



Republican River Compact Administration to Meet August 28

The Republican River Compact Administration (RRCA) will hold its 2024 annual meeting at 10:00 a.m. Central Time on Wednesday, August 28, at the Colby Event Center at 1200 South Franklin Street in Colby, Kansas. A livestream of the meeting can be accessed at the Kansas Department of Agriculture Division of Water Resources website: agriculture.ks.gov/RRCA.

The RRCA meeting will focus on water-related issues and activities, including compact compliance, within the Republican River basin in Kansas, Colorado and Nebraska.

In addition, RRCA will hold a working session at 8:30 a.m. Central Time to prepare for the annual meeting, also at the Colby Event Center location. Both the working session and the annual meeting are open to the public.

Kansas, Colorado and Nebraska entered into the Republican River Compact in 1943 to provide for the equitable division of the basin’s waters, remove causes of potential controversy, and promote interstate cooperation and joint action by the states and the U.S. in the efficient use of water and the control of destructive floods. The RRCA is composed of three commissioners representing Kansas, Colorado and Nebraska: KDA–DWR Chief Engineer Earl Lewis; Colorado State Engineer Jason Ullmann; and Nebraska Department of Natural Resources Acting Director Jesse Bradley.

Individuals who have questions regarding the meeting should contact Chris Beightel, KDA water management services program manager, at Chris.Beightel@ks.gov or 785-564-6659.

For more information about RRCA and this year’s annual meeting, including agendas and the link to the meeting’s livestream, please visit agriculture.ks.gov/RRCA.



 Rebuilding the US cattle herd could take years, analyst says

Rebuilding the U.S. cattle herd could take years as market conditions encourage ranchers to sell off rather than keep their cows.

Although pasture conditions and feed costs are improving, there are still financial upsides for producers to send their beef calves and heifers to feedlots rather than raise them, according to a CoBank Knowledge Exchange research brief.

Some top analysts are expecting herd numbers to return to 2023 levels in the next three to four years if market conditions persist, while others believe cattle contraction to continue through 2027, CoBank analyst Abbi Prins wrote.

The duration of the latest beef cow decline has raised concerns for large companies and beef stakeholders.

The number of U.S. beef cows have retracted over the past five years to its lowest point since 1961 at 28.2 million, according to the U.S. Department of Agriculture. Widespread drought played a large role in the cattle squeeze. The severely dry conditions damaged pastures and lowered hay supplies as market factors drove up prices for cows, feed and inputs.

While more favorable weather has improved forage production this year and feed costs begin to come down, cattle prices remain strong, incentivizing ranchers to continue selling their animals.

“Right now, it’s not worth the risk to hold onto heifers as the potential upside of selling the calf has immediate pay off,” Prins wrote in the report, noting a $300 upside to sell rather than raise calves.

Should cattle prices stay strong, CoBank estimated it could be 2026 or 2027 before heifer retention rates and the beef cow population pick up, pressuring buyers like Tyson Foods, JBS and other larger meatpackers.

According to the Sterling Beef Profit Tracker, packers lost nearly $100 per head throughout 2023 and 2024 and are on track to be in the red again next year as corn and soybean costs soften.

Looking ahead, CoBank said it was critical for producers to generate cash flow and build up their feedstocks after a couple of tough years with poor weather and high interest rates.

“Once the herd does start rebuilding,” Prins wrote, “a drastic change in beef cow numbers is unlikely as the growth could look more like a slight bump in cow inventory.”



ASA Statement on EPA Release of Final ESA Herbicide Strategy

With the release of the Environmental Protection Agency’s final Endangered Species Act Herbicide Strategy comes ongoing concerns for soy growers worried about feasibility of implementation and its impacts.

Josh Gackle, president of the American Soybean Association and a soybean farmer from North Dakota, said of the final ESA Herbicide Strategy, “While there are clear improvements to the final Herbicide Strategy over what was first proposed, we are disappointed EPA chose to leave so many opportunities on the table to make this strategy workable for U.S. agriculture. We remain concerned with the complexity of this framework and whether growers and applicators will be able to clearly understand how to implement it. Likewise, we continue to have concerns as to the type and affordability of runoff mitigations EPA has provided, the potential distance of spray drift buffers, the number of mitigations farmers will need to adopt, and whether these requirements are supported by the best available science, as the law requires. As finalized, the Herbicide Strategy is likely to cost U.S. farmers billions of dollars to implement and could result in significant new hurdles to farme rs accessing and using herbicides in the future.”

Another significant improvement EPA largely has not addressed is how the agency evaluates whether pesticides pose a genuine risk to endangered species. As ASA and over 300 other groups noted in a letter to EPA several weeks ago, the agency’s current process is unduly conservative, greatly overestimates risks, and demands farmers adopt far more restrictions than are truly necessary to protect species. Disappointingly, the final Herbicide Strategy does little to address these concerns. As requested in our letter, we hope EPA will take us up on our invitation to discuss this central piece of its ESA regulations in the days ahead.

Gackle concluded, “While we appreciate the Herbicide Strategy restrictions will not take effect immediately and that EPA plans to implement them in individual pesticide registration decisions moving forward, ASA will carefully observe how closely EPA adheres to its strategy in those proposed decisions. While we support EPA becoming compliant with the Endangered Species Act, it is essential that the agency’s approach meets its legal obligations and is workable for agriculture. The final Herbicide Strategy does not satisfy these needs. We look forward to continuing to work with EPA to do better in the next phase of implementation.”




NCGA Calls on Canadian Officials to Head Off Rail Strike

The National Corn Growers Association today urged Canadian Prime Minister Justin Trudeau to resolve a dispute between his nation’s railways executives and union leaders that could result in a strike interrupting rail service into the U.S.

“If a strike shuts down rail service from Canada into the U.S., it will adversely impact America’s farmers who rely on rail to ship goods between the two countries,” said NCGA President Harold Wolle. “We encourage Prime Minister Trudeau, the Teamsters and Canadian rail workers to do everything possible to avoid such a strike.”

Canada is the third-largest destination for U.S. agricultural exports and the second-largest source of agricultural imports. Of great concern to corn growers, a strike could interrupt shipments of fertilizer imports and exports of ethanol, corn and byproducts used as animal feed.

The Teamsters have been at an impasse with the Canadian National Railways and the National Pacific Kansas City over labor contracts. Both railways issued notice on Sunday night that they would lock out workers beginning on Thursday if a resolution with the Teamsters isn’t reached.

Under federal labor law, Canadian officials can order all parties to enter binding arbitration.

On Monday, NCGA joined other agricultural groups in sending a letter to the prime minister calling for action to halt the pending strike.

“We plan to keep calling for a resolution on this issue,” said Wolle. “The stakes are high and this is the last thing our farmers need as they deal with a drop in corn prices and higher input costs.”



RFA to STB: Reliable, Efficient Rail Service Crucial for Ethanol Industry Success

In comments submitted Friday to the Surface Transportation Board, the Renewable Fuels Association stressed the importance of consistent, safe and timely rail transportation to the ethanol industry and its customers. The comments were submitted in response to a request from STB for input on recent trends and strategies for growth in the freight rail industry. RFA also submitted a new study showing that rail shipments of ethanol and grain are disproportionately affected during periods of rail capacity constraints and widespread service interruptions.

“The relationship between the freight rail industry and ethanol industry is closely intertwined, as roughly three-quarters of U.S. ethanol is shipped by rail,” wrote Justin Schultz, RFA’s director of environment, health and safety. “Efficient, reliable, and effective transportation services are crucial for this industry, which relies on rail, truck, and barge transportation for both inbound products (grain) and outbound fuel (ethanol). Rail is increasingly utilized due to its efficiency in bulk shipping.”

Schultz pointed out that ethanol producers are investing in modernized shipping infrastructure, such as expanding and upgrading rail loading and unloading facilities. They also support cost-effective innovations in tank car design and safety protocols to address safety concerns and regulatory requirements. Schultz said the ethanol industry also recognizes the environmental advantages of rail transportation, such as better fuel efficiency and a lower carbon footprint, compared to other transportation modes.

“Through cooperation, the ethanol and rail industries can continue to proactively address challenges and pursue innovative solutions to reverse recent trends and promote freight rail growth,” Schultz wrote. “By continuing to invest in infrastructure, safety, and efficiency, and by fostering collaborative partnerships, both shippers and rail carriers can drive positive change in the industry.”

Study Looks at Rail Inequity
A new third-party analysis released with RFA’s comments indicates that Class I railroads often appear to differentiate service levels across different commodities and customers. During periods of capacity constraints—whether due to equipment, weather, or labor challenges—the differentiation in service levels for different commodities becomes more pronounced. In general, trains carrying ethanol and grain tend to experience longer dwell times (delays), slower speeds, and longer turnaround times than trains carrying other goods like crude oil, coal, and intermodal shipping containers. This discrepancy is especially egregious between crude oil and ethanol shippers, as the equipment and crew requirements are essentially identical, yet service levels differ significantly.

Further, the study, prepared for RFA by HigbyBarrett, states that the unique operating conditions of ethanol plants place greater significance on efficient inbound (grain) and outbound (ethanol) rail service, particularly since ethanol plants often have limited storage capacities for grain and ethanol. Transportation service impediments can directly impact an ethanol plant’s ability to continue operations, and—if service interruptions last long enough—can ultimately result in suspended operations.

“Class I railroads prioritize service differently, depending on the customer type,” the study found. “During periods of railroad service challenges, some high-value railroad customers maintain consistently high levels of service as revealed through terminal dwell times and average train speeds. Grain and ethanol shippers experience the lowest service levels during these adverse periods for railroads, exhibiting higher than normal terminal dwell times and lower train speeds. Delays in transportation service have an opportunity cost from lost market sales, increased operational costs, and increased stock carrying costs.”