Crops



Expanding grain trade with Mexico

The port of Progreso is strategically located as a natural gateway to connect the year round feed importer, the Yucatan Peninsula, with the rest of the world by sea. Progreso port currently processes approximately 4 million metric tons of product, including hydrocarbons, agricultural bulk, containers and general cargo. Thanks to the North American Free Trade Agreement, a near 200% growth in sales has occurred of U.S. corn, sorghum, barley and related co-products to Mexico.

With increased trade comes necessary infrastructure development — prompting more growth.

A project supported by the Progreso port to build a new access road to its offshore terminals will help to expand access and aid in increased transportation capacity.

“A number of ports in Mexico are under expansion projects to allow more trade,” said Julio Hernandez, U.S. Grains Council director in Mexico. “In this case, the port of Progreso will allow greater and faster operations for feed grains in terms of moving grain out of the terminal, which is good news for southeastern Mexico and U.S.… Continue reading

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Is there a safety net for plummeting prices?

It could be worse than we thought. With record corn production in a year with heavy spring rains and late planting problems, the price drop in recent weeks suggests that corn demanders see the crop-reducing effects of 2012 drought as an aberration—since apparently improved seed genetics successfully protected 2013 corn production from moderate drought and planting problems.

Compared to the 2012 corn crop, the November WASDE reports record production, increased crop utilization—both domestically and internationally—and the year-ending stocks increasing by nearly 1.2 billion bushels of corn. The result is a projected season average corn price received by farmers of $4.50 per bushel for the 2013 corn crop, a drop of $2.93 per bushel from a year earlier.

For most farmers, even on the most productive land, $4.50 is getting frighteningly close to their cost of production—and for some-to-many land costs would not be covered. This leaves little margin on the downward side before things get really scary.… Continue reading

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Novel corn gene could hold keys to plant defense

Purdue and University of Illinois researchers have discovered a novel corn mutant whose leaves are highly susceptible to attack by Western corn rootworm beetles, a pest that feeds primarily on corn silks and pollen.

While Western corn rootworm beetles were previously thought to avoid corn leaves based on food-source preference, study of the mutant suggests that normal corn plants have an active defense mechanism that deters the beetles from feeding on their foliage. Identifying this mechanism could lead to new strategies for controlling Western corn rootworm, which is the most destructive insect pest of corn in the U.S.

“This opens up a whole new opportunity to understand more about the mechanism of defense in corn to control this beetle,” said Gurmukh Johal, professor of botany and plant pathology. Johal and Stephen Moose of Illinois independently discovered the mutant around the same time.

“In identifying the genetic pathway involved in resistance, we can develop better ways of controlling this pest without having to use insecticides,” Johal said.… Continue reading

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What is the perfect price for corn?

With plummeting crop prices, a proposed shake up of the Renewable Fuels Standard, and a grim outlook for corn and soybean profitability in the coming years, many are wondering how low prices can go. While crop producers have enjoyed unprecedented profits in the last couple of years, livestock producers have been burdened by the high feed costs. With these factors in mind, what is the ideal price for corn to maintain profitability in both the crop and livestock sectors?

Barry Ward, production business management leader for Ohio State University Extension, has calculated some average breakeven prices for corn and soybeans based on input costs for 2014.

“For 160-bushel corn, we are looking at a breakeven price right around $5 a bushel. A higher yield of 190 bushels is around $4.70 and for our poorer soils, it is around $5.50. When we compare that to the prices we are seeing next year, we see tighter margins and maybe negative margins,” Ward said.… Continue reading

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High prices for corn not in the foreseeable future

At the end of November, the vast majority of the U.S. corn and soybean harvest had been completed. Several storms during November were accompanied with high winds that severely damaged parts of remaining corn fields in Ohio. Some Ohio elevators were plugged, unable to receive grain during the last 20% of harvest. Weather delays that prevented harvest added to the pain of fully loaded trucks with nowhere to go.

As many producers put a fantastic year in 2013 to bed, they cannot help but look ahead to 2014. Commodity price and weather uncertainty (huge factors seen every year) are always there. Corn prices for several years have been above average prices compared to years past. Corn prices at $6 or above added significantly to the balance sheet. High corn prices brought much prosperity to U.S. grain farmers. But, looking ahead, those high corn prices are not prevalent. The landscape is vastly different.… Continue reading

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Insurance coverage of corn and soybean production costs since 1980

Since 2006, crop insurance has been the dominant crop safety net program. However, the prosperity that has characterized this period may be coming to an end. Thus, crop insurance may perform differently in the future than during the past few years.

How well has insurance covered the cash plus land cost of producing corn and soybeans since 1980?

Beginning with 1975, the U.S. Department of Agriculture (USDA), Economic Research Service has surveyed farmers about their cost of producing the major program field crops, including corn and soybeans (see http://www.ers.usda.gov/data-products/commodity-costs-and-returns.aspx). This study specifically examines cash cost plus the charge for land. Cash costs include, among others, seed, fertilizer, chemicals, custom operations, fuel, repairs, and hired labor.

Farms often borrow money for their cash plus land costs to cash flow production between the planting and harvesting of a crop. Thus, these costs are a common concern for banks and other providers of credit.… Continue reading

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Farmland values expected to decline with crop prices

While cropland values in Ohio increased in 2012 and 2013, they are expected to remain flat or even decline in 2014, an economist from Ohio State University’s College of Food, Agricultural, and Environmental Sciences (CFAES) said.

Ohio cropland value rose 12 percent this year, with bare cropland averaging $5,600 an acre, said Barry Ward, production business management leader for Ohio State University Extension.

Ward, citing statistics from the Ohio Field Office of the National Agricultural Statistics Service, said he expects the trend to remain flat or even reverse next year, with the key factors — crop profitability and interest rates — both showing indications of “unfriendly” moves in 2014. This, as crop profits are projected to be lower or possibly negative while interest rates have moved higher since last year, he said.

“Projected budgets for Ohio’s primary crops for 2014 show the potential for little to no profits,” Ward said. “Cash rental rates will move based on where they are in relation to the current market.… Continue reading

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Corn buyers returning to the U.S. market

Lower oilseed and grain prices have prompted a bevy of overseas buying. Corn prices have fallen to a three-year low, amidst huge and better than expected harvest reports. The USDA reported net corn sales of 1.3 million metric tons (51.2 million bushels) and more than a quarter million tons (9.8 million bushels) of new sorghum sales. The bulk of the new sales are destined for unknown destinations, accounting for 428,000 tons (16.8 million bushels) of corn and almost 176,000 tons (6.9 million bushels) of sorghum. Much of the rest of the purchases were sold to familiar faces — China, Japan and Mexico.

Couple that with the announcement of over 4.5 million tons (177.2 million bushels) of new corn sales during the weeks of Oct. 10, 17 and 24 and one can easily get a pulse for international demand at these prices.

However, market wires are abuzz with news that some importers have purchased U.S.… Continue reading

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2013 harvest overview

The talented group of Extension crop specialists in Ohio can offer a unique perspective of the growing season from their big picture look at the crops statewide. Here are overviews of the 2013 growing season they provided.

 

2013 corn summary by Peter Thomison

The 2013 growing season throughout much of Ohio was characterized by favorable to highly favorable conditions for corn growth and development. May rainfall was below normal but rainfall in June and July — during mid to late vegetation stages, pollination, and early grain fill — was near normal to above normal. August rainfall was below normal whereas during late grain fill in Sept rainfall was above normal.

A severe wind storm on July 10 resulted in widespread root lodging and some localized greensnap damage. Although plants in most root lodged fields recovered within a week or two after this wind event, recovery in some fields was limited or negligible and this may have interfered with pollination and reduced yields.… Continue reading

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Prices yield a bumper crop of disappointment for corn growers

Crop yields generated smiles around Ohio this year, though prices produced a bumper crop of disappointment, especially for corn growers.

To the north and west, the corn crop was setting records, while the soybeans suffered from a dry summer.

“The harvest for us started Sept. 11 this year and by Oct. 4, we were 20,000 more bushels taken in than last year,” said Mitch Welty, the grain manager for Blanchard Valley Farmers Co-op (BVFC) based in Findlay. “By Nov. 1, we were at a half million more bushels than last year. Last year’s total bushel take was at 15.6 million bushels. This year we are at 16.8 million bushels with some harvest left to go.”

BVFC has been aggressive about adding storage in recent years, but was not able to keep pace with this year’s massive corn crop.

“Last year we had just over 9 million bushels of corn and this year we are over 11 million bushels of corn, which is due to a combination of acreage and yield.… Continue reading

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Ohio’s harvest yields impressive numbers

After the brutal drought of 2012, 2013 has proven to be an incredible growing season for Ohio. Many combines have harvested yields of a lifetime this fall.

Farmers faced too much rain in the spring, too little rain the summer and some significant wind that all contributed to yield loss, but ultimately Ohio is seeing yields ranging from smile-inducing to outright jaw-dropping that will be remembered for years to come on many farms.

“We have some fields and some farms where there are lifetime yields. There have been some harvest issues but the yields are very, very good,” said Larry Rump, DuPont Pioneer account manager in northern Ohio. “There is a lot of 225-bushel corn and a lot of fields that are 20% better than what they have historically been. I had authenticated weigh of 296 bushels in northern Seneca County. I am worried that when we look at these great yields, next year we’ll plant all offensive hybrids and we’ll have a defensive year.”… Continue reading

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OSC launches education website to provide resources, e-learning courses and networking

Ohio soybean farmers understand that today’s youth is the future of the soybean industry and all of agriculture. For this reason, the Ohio Soybean Council (OSC) and soybean checkoff have launched a new website to provide educators with a wide array of relevant classroom materials and direct access to industry partners.

The site was specifically developed to bring real-world situations into the classroom focused on chemistry, biology, biotechnology, environmental science and agriscience.

“For almost two decades, OSC has been investing in the development of curriculum and educational materials focused on the science of soybeans, as well as cultivating strong education networks of teachers throughout Ohio,” said John Motter, OSC chairman and soybean farmer from Hancock County. “Through the development of this new, interactive website, Ohio soybean farmers have created a centralized location where all of these and future materials can be accessed.”

In addition to relevant curriculum materials related to soybean production and agriculture, the site also houses:

  • Career videos
  • Interactive e-learning courses
  • Background information
  • Networking and sharing abilities

“When we began this process, we spoke with teachers about what information and resources were out there to educate students about soybeans, agriculture and the many careers that are available in these fields.… Continue reading

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Yield numbers could still be rising in USDA estimates

The Nov. 8 report followed the reality of no report in October due to the two week shutdown. Corn production for the U.S. in 2013 was estimated at 13.989 billion bushels. The nationwide yield was increased to 160.4 bushels per acre. While the yield was above trade expectations, it is not out of line according to many harvest reports. Many producers are indeed seeing fantastic corn yields. Some will see their farm average near or above 200 bushels per acre. In addition, with the increased corn production, ending stocks increased as well. That increase was a much smaller increase than the actual production increase. More importantly it was the second piece in the puzzle regarding all of the corn numbers. First, corn production was below 14 billion bushels. Second, ending stocks were less than two billion bushels. Those have been huge landmarks as traders and producers evaluated the 2013 U.S. corn production.… Continue reading

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2014 Ohio Commercial Pesticide Applicator Recertification Conferences

The 2014 Ohio Commercial Pesticide Applicator Recertification Conferences have been set and announced by the Ohio Pesticide Safety Education Program of OSU Extension (http://pested.osu.edu). The dates and locations of the conferences are Jan. 30 — Dayton Convention Center; Jan. 31 — Sandusky, Kalahari Conference Center; Feb. 19 — Akron, John S. Knight Center; and March 6 — Columbus Convention Center.

For driving directions, the agenda for each day, pre-registration fees, on-site registration fees, a list of categories offered, and on-line registration link or a download link for a printable registration form visit the above website of the Pesticide Safety Education Program. Remember that one needs to attend the entire day to meet the five hours required for an Ohio commercial license. Plan ahead and register early to avoid missing these convenient opportunities to acquire recertification all in one day.

Reciprocity is available for licensed commercial pesticide applicators who hold licenses in Indiana, Kentucky, Michigan, Pennsylvania and West Virginia.… Continue reading

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Corn and soybean exports holding a strong pace

In the September WASDE report, the USDA forecast 2013-14 marketing year exports at 1.225 billion bushels for corn and 1.37 billion bushels for soybeans. The strong pace of exports and especially export sales so far this year has created expectations of larger forecasts in the future.

As of October 31, the USDA reported that cumulative corn export inspections for the marketing year that began on Sept. 1 totaled 206.7 million bushels. Cumulative inspections were 30% larger than those of last year and represented 17% of the current USDA projection for the year. Cumulative export commitments — exports plus unshipped export sales — as of October 24 were reported at 808 million bushels. Those commitments were 88% larger than commitments of a year earlier and represented 66% of the USDA projection for the year.

Compared to commitments of a year ago, commitments this year are 138 million bushels larger for China, 125 million larger for Mexico, and 88 million bushels larger for unknown destinations. … Continue reading

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The Brazil Report, Nov. 19

In the 2012-13 marketing year, when the United States had a historical drought and a huge crop failure, Brazil became, at least for a brief moment, the world’s top corn exporter. According to the Brazilian Ministry of Development, Industry and Foreign Trade, from September of 2012 to August of 2013 (which is the U.S. marketing year), the South American country exported 25.7 million metric tons, compared to 18.6 million sold by the United States.

If one looks at the USDA numbers, he or she will see that Brazil exported 24.3 million tons in 2011-12 and is likely to sell 22 million in 2012-13. Who is wrong? Nobody. The difference exists because the Brazilian marketing year (which is taken into account by the USDA) starts in February and ends in January. So, the Brazilian 2012-13 crop (planted in late 2012 and early 2013 and sold from February 2013 to January 2014) is still ongoing.… Continue reading

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EPA’s RFS announcement has biofuels industry scrambling

The term “outrage” was used by the National Corn Growers Association in describing the Environmental Protection Agency’s mid-November proposed 2014 Renewable Fuel Standard (RFS) volumetric requirements that dramatically decrease the amount of biofuels required to be used by gasoline manufacturers and retailers in 2014.

For 2014, EPA’s proposed renewable volume obligations set the annual targets for the utilization of cellulosic, biodiesel, advanced and total renewable fuel within transportation fuels. The proposed rule caps corn-based (or conventional) ethanol at 13 billion gallons. These proposed volume obligations are a drastic reduction from the mandated Renewable Fuel Standard Required Volume Obligations (RVOs) in statute. The proposed rule cuts 1.4 billion gallons from the conventional ethanol cap that was set at 14.4 billion gallons.

“Ethanol and the RFS have been a great success story. Now, the EPA is sending a terrible message that we no longer have a long-term energy policy for biofuels, which was the original intent of this forward-thinking legislation.… Continue reading

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NAFTA celebrating decades of success for agricultural trade

The North American Free Trade Agreement (NAFTA) came into effect Jan. 1, 1994, which makes Jan. 1, 2014, the 20th anniversary of the landmark trade agreement that has served as an example for many trade deals that followed.

In the years since NAFTA took effect, Mexico grew to become the second largest market for U.S. corn, the top market for U.S. sorghum and the premier market for distiller’s dried grains with solubles (DDGS). Growth in demand for feed grains continues to be driven by a steady expansion in livestock and poultry production in the country.

“NAFTA paved the way for Mexico’s agricultural trade,” said Julio Hernandez, U.S. Grains Council director in Mexico. “In the beginning, Mexico brought in new technologies that helped improve their efficiencies to become more profitable. With the support of the Council’s office in Mexico, Mexican importers became more efficient grain buyers, through direct contacts with U.S. suppliers and as livestock production practices improved, the Mexican consumer benefited from cheaper and better quality meat, milk and eggs which in turn stimulated rapid growth of the Mexican livestock industry.”… Continue reading

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Ohio water quality bill gets revamped to buy time for research

Last summer, the Ohio Legislature introduced Senate Bill 150 to address the growing concerns of water quality, in large part through regulating nutrient management of agricultural operations.

While agriculture is undoubtedly a contributor of the phosphorus being blamed for the continued problems of toxic algae development in Ohio’s lakes and streams, there is also clearly still much to learn about this complex challenge and the best solutions in addressing it.

After a summer’s worth of work from legislators, agricultural organizations and other stakeholders, a new version of SB 150 was introduced in early November that pulls back on the reins a bit so the ongoing research can get ahead of the legislation.

“The development of algal blooms on numerous lakes across Ohio show there are still questions to answer regarding the quality of water in the state. These blooms also show that water quality issues go far beyond agricultural nutrients and we strongly encourage a more comprehensive review of water infrastructure in Ohio,” said Adam Ward, executive director of the Ohio Soybean Association.… Continue reading

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