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Articles from 2004 In February


Rice acreage expected to bounce back

BUNKIE, La. – This year’s planting of rice in Louisiana could exceed 500,000 acres, according to an LSU AgCenter economist.

Gene Johnson told farmers from Avoyelles and Rapides parishes who attended a rice clinic in Bunkie that good rice prices – as high as $9 per hundredweight – will prompt many farmers to increase acreage.

"I think our price will remain firm through this year," Johnson said during last week’s meeting.

Louisiana farmers planted 540,000 acres in rice in 2002. But with low prices in 2003, the acreage slipped to 470,000 acres –the largest decline among the six southern and western rice-growing states.

Johnson said strong prices also are remaining steady for corn, cotton and soybeans.

Regarding the rice, Johnny Saichuk, LSU AgCenter rice specialist, said as many as 100,000 acres may be planted in the new Clearfield 161, a variety of rice developed at the LSU AgCenter’s Rice Research Station in Crowley that allows the crop to be sprayed with Newpath herbicide to kill red rice.

Saichuk advised two applications of the Newpath herbicide as close as possible within a 14-day period.

Saichuk said Clearfield also can decrease the amount of water required to grow rice. He said because Clearfield allows fields to be flooded later than usual, rice water weevil larvae are killed in the dried earth. Once the field is flooded, he said, Clearfield plants will mature enough that any larva surviving the dried conditions will have less of an impact.

But the LSU AgCenter expert also cautioned it’s important not to use Clearfield for two consecutive years in a field. It’s best to rotate with soybeans, preferably the Roundup Ready variety, or corn, he said, but not Clearfield corn. A field can also be put into pasture, he said, but it should not be left fallow without maintenance.

Farmers should wait for 18 months before planting conventional rice in a field where Clearfield has been used, he said.

On another note, Saichuk said applying lime to rice fields was once considered a bad idea.

"I’m not afraid to apply lime anymore," he said. "I used to be."

The specialist said application of lime is a good choice for soil with a ph of less than 5. If the crop yellows, he said zinc can be applied.

Saichuk also cautioned farmers that removing all straw from a rice crop requires replenishing potassium in the soil.

Burning the straw doesn’t remove potassium, he said, but baling straw or raising crawfish on rice fields will deplete a valuable potassium source.

During the day, farmers also got some precautions on an insect pest – the Mexican rice borer that is now being found in southeastern Texas.

Boris Castro, an LSU AgCenter entomologist, said the Mexican rice borer larvae can decrease yields by as much as 50 percent.

"We don’t have it here yet, but it’s moving in this direction," Castro said.

Insecticides are effective against the borer, Castro said, but they must be applied before the insects attack the stalk. Once the pests enter the stalk, "there is nothing you can do," he stressed.

Meanwhile, the LSU AgCenter entomologist said the European corn borer seems to be migrating from the north toward Louisiana, although it doesn’t appear to be as adapted to humid conditions as the Mexican corn borer.

Rice farmers in Louisiana already have to contend with the sugarcane borer and the rice stalk borer.

Carlos Smith, LSU AgCenter horticulturist in Avoyelles Parish, said the Mexican borers thrive in ornamental grasses, and he fears the insect will be inadvertently introduced into Louisiana in plants sold to large retailers.

The insecticides for borers can’t be used on the borers in fields also used for crawfish farming, Castro said, but research is under way to develop new chemistry to kill borers but not affect crawfish.

Bruce Schultz is a writer for the LSU AgCenter.

e-mail: bschultz@agcenter.lsu.edu

Con-till makes for easier farming

HARLINGEN, Texas – Buck Braswell believes a good farmer can make new technology work if he wants to badly enough.

He’s a good case in point. When he decided to convert all his Lower Rio Grande Valley cotton and grain sorghum acreage to reduced tillage he sold his bottom plows. “That way I had no choice,” Braswell says. “I had to make it work.”

That was more than 10 years ago, and Braswell says he’s eliminated a lot of labor, energy and mechanical expenses.

“I may occasionally push up a row, but I haven’t had a breaking plow in the ground for 10 years,” he says. “And I haven’t employed a hoe hand for six or seven years. I used to use a lot of manual labor to hoe weeds.”

Braswell, from near Harlingen, farms on his own and also manages a significant acreage for another farm operation. Overall, he oversees about 7,000 acres.

“When I first came here, we had 40 employees and a lot of tractors,” Braswell says. “Now, we have 12 employees and four tractors. Reduced tillage makes that possible. And over the past few years I’ve realized that farming is not as hard as it used to be.”

He says energy represents a big savings. “I figure I’ve cut diesel use by three-fourths,” he says. “Diesel represents a big expense.”

Reduced maintenance on a yard full of equipment and fewer employees necessary to operate and repair it makes a significant cut in overhead.

Braswell points to other, less tangible, advantages as well. He says his soil improved because of reduced tillage. “We keep stubble on the fields all the time,” he says, “so we build up a lot of humus. Organic matter has increased significantly. Also, we see a lot of quail in and around the fields. Quail are sensitive to some pesticides, but they seem to be doing quite well here.”

Rotation, he says, makes reduced tillage systems work better.

“I plant cotton into grain stubble and grain into cotton stubble,” he says. “I never get rid of the stubble. Rotation provides a good companion for conventional tillage and most areas of the country have at least one crop that makes a good rotation option.”

He always keeps something on the ground. “I use 2,4-D as soon as possible after cotton harvest to prevent re-growth from providing a boll weevil host. The Texas Department of Agriculture approves this manner of stalk destruction. It probably works better than mechanical. I rarely shred stalks.

“The soil just gets stronger. I can work the fields faster without worrying about sand blowing and keeping the stubble on the soil does good things for the environment. I’ve reduced a lot of compaction with rotation and reduced tillage.”

Braswell says controlled traffic patterns limit hard pans. “We have to keep the wheels in the same path to prevent compaction. That’s a key.”

He says leaving the previous crop stalks in the ground also keeps the soil open and provides channels for the next crop’s roots to follow.

Braswell had committed to conservation tillage before the advent of Roundup Ready technology. “We had to use a lot of Fusilade and Staple with a hooded sprayer,” he says. “But Roundup Ready varieties make the system so much easier.”

He’s looking forward to Roundup Flex and LibertyLink technology. “Roundup Flex will be a big improvement,” he says. “Occasionally we’ll get a rain that prevents us from applying Roundup on time. Pigweed gets away from us and is hard to kill. After the five-leaf stage on cotton we can’t go over-the-top with Roundup. The Flex will extend that application window.”

He says the LibertyLink system, using Ignite herbicide, will control weeds that Roundup may be weak on. “I’m looking forward to trying it,” he says. “I’ve never been one to get stuck in a rut. I want to try new technology.”

Braswell’s conservation tillage recipe for cotton starts when the grain sorghum crop is about 10 days from harvest. “I spray Roundup with a high-cycle sprayer and just let the stubble lay after I cut it. When grass and weeds start coming on, around September, I’ll spray two more times. Some years I’ll bed it up.”

Braswell may put rows up in December and January and applies fertilizer. He uses a 22-11-04 blend for cotton. I also add humic acid and zinc to help free up the nutrients.

He knocks down rows with a PrepMaster, if he didn’t build rows in the fall.

“The week before I plant, I always spray Roundup to get any small weeds. I may spray again when cotton is just coming out of the ground. I want it clean when I plant.”

Braswell will use Roundup again when he defoliates “to get a good, clean crop.”

He starts his grain crop by spraying cotton in late August with 2,4-D to kill stalks. “After the first rain, I’ll spray again with Roundup and 2,4-D to take out volunteer cotton. If necessary, I’ll make another application or two into January. And I’ll spray again just before I plant.”

Here’s where his recipe changes from cotton. He may cultivate grain sorghum, usually the fourth or fifth day after planting and with a light dose of Roundup. “I want it clean when the grain comes up,” he says.

“I’ll use the cultivators again when the grain gets 6 to 8 inches high. Cultivation is the only way to keep grain sorghum clean,” he says. “But I never cultivate cotton.”

He applies fertilizer, 25-5-05 when he pushes up the rows.

Braswell uses seed technology to reduce applicator exposure and improve pest control and crop health.

“I treat all my grain and cotton seed with Cruiser. It’s good for my labor and good for seedling health,” he says. Cottonseed also gets PGR IV and zinc added to the seed.”

In addition to herbicide technology, Braswell also uses Bollgard and Bollgard II cotton varieties. “I’ll have some of each this year,” he says. Variety selection will include DPL 555, FM 800 and BCG 30.

He says with new technology, including seed treatments, his biggest expenses are now in the planter.

Braswell admits to taking a little ribbing years ago when he first tested reduced tillage systems. “My neighbors thought I was crazy,” he says. “But after three or four years, they saw what conservation tillage could do and started asking me questions.”

He says yields may not increase substantially but are usually better in a dry year. Reduced labor, lower energy costs and less equipment demand and maintenance make a difference.

“The organic matter we’re building helps a lot,” Braswell says. “And other farmers tell me they are saving three or four trips across the fields with a disk by using Roundup. Nobody disks anymore and few use cultivators. Just about every farmer in the Valley uses some form or conservation tillage. And about 40 percent of the area’s farmers are treating their fields similar to the way we treat ours.”

Braswell says he learns something new every day he farms. “And when I learn something, I’m happy to pass it along to anyone who asks.”

e-mail: rsmith@primediabusiness.com

Dunavant: 'Too early to fix new crop prices'

MEMPHIS, Tenn. – As attractive as current prices might be, Cotton producers should be patient in fixing new crop cotton prices, William B. Dunavant Jr. said in his annual comments to the Mid-South Farm and Gin Show in Memphis.

Dunavant, chairman and CEO of Memphis-based Dunavant Enterprises, Inc., in Memphis told Mid-South Farm and Gin Show attendees that even with the market hovering around 68 cents, “prices still have an opportunity to go higher. Buying puts is an intelligent mechanism particularly this year.”

Anticipating the question on many growers’ minds, Dunavant said last fall’s decline in cotton prices occurred because commodity funds, speculators and even merchants were long in the market, “and when people started selling, there was nobody to stop the market.

“How prices went from 86 cents to 65 cents is beyond my comprehension, but it happened,” said Dunavant, who said he would forego any “funny” stories for this year’s presentation because the past few months had not been much fun. “Today, commodity funds and speculators are about 7 percent long. The ingredients for a rally are right there for the remainder of the season.

“Can you imagine the scenario with prices if one major producer had a shortfall this season. We wouldn’t be able catch prices, they’d move so fast. It may not happen, but we need to recognize that with Brazil on our case every day, that if something would happen in the WTO that would alter the farm program negatively, that would restrict cotton acreage. That would again be bullish on cotton prices.”

Dunavant said that U.S. cotton producers, “harvested one of the better crops in the Mid-South and Southeast that I can remember. There was very little high micronaire. We had good staple, good grades and good yields.”

U.S. exports for the 2003/04 marketing year could end up around 13.6 million bales, noted Dunavant. “I believe that they will be greater than that. We have already registered 11.6 million bales through yesterday, 2.4 million bales higher than a year ago.

“When the smoke clears for this season, I see the U.S. carryover at 3.5 million bales, because I believe more business is about to come.

Dunavant said the market may have more fireworks later in this marketing year and into the next. (The marketing year runs from Aug. 1 to July 31.)

“The critical time is not today,” he said. “But April through September when foreign supplies are dwindling and U.S. supplies are dwindling and our carryover is going down. By Sept. 1, the U.S. carryover will be down to 2.5 million bales. So we’re going to go through a tight period in the United States and the world.”

Dunavant projected that domestic consumption of cotton will drop from 6.3 million bales this marketing year to 6.0 million bales in 2004/05.

World numbers for 2003/04 are very friendly, according to Dunavant. “We think production in the world will be 93 million bales this marketing year with world consumption at 97.8 million bales. World carryover on August 1 will be down to 31.6 million bales.”

As to China’s announced cotton production of 22.4 million bales for 2003/04, “Those numbers just don’t work,” Dunavant said. “We think the number is really 20 million bales and a million of that cannot be spun.”

China will continue to be a major buyer of old crop and new crop for the next six to eight months, said Dunavant. “They are buying high-grade cotton around the world. But the best cotton is about to disappear, and they will run their mills on the next best cotton. They will be buying many types of U.S. cotton.”

China is expected to announce import quotas for 11.9 million bales of imports in the next few days, noted Dunavant. “They don’t put out the quotas unless they intend on using them. Next December, they will release quotas for 2005, about 894,000 tons of cotton. These are reasons why I think the market has the potential to move higher. Of course, the market can pull back.”

Mexico and Turkey also continue to be strong customers of U.S. cotton, noted Dunavant. “Through yesterday, Turkey has already registered 1.08 million bales of U.S. cotton. Mexico has bought 1.6 million bales.”

Cotton production should return to more normal levels in Australia, according to Dunavant. “The drought is broken. There is water in the dams. We expect them to produce about 3 million bales.”

For 2004/05, Dunavant projects U.S. cotton acreage at 14.3 million acres, a little less than National Cotton Council figures. “We think the price of soybeans and corn is going to take some cotton acreage. That will produce of a crop of 18.3 million bales.”

It’s too early to tell where exports might head next marketing year, according to Dunavant, “but we’re calling it a minimum of 12 million bales. That gives us a 4.1 million bale carryover for 2004/05. That’s not a bearish number, but these are only projections. A lot can happen over the next year.”

Meanwhile there will be a sharp jump in world production to around 103 million bales for 2004/05. “On the surface that looks negative, but we see world consumption going from 97.8 million bales to 99.2 million bales, triggered by continued increases in Chinese consumption.

World carryover would move up to 35.8 million bales, “not a bearish 68-cent number at this stage. China is going to sharply increase production, to 28.5 million bales. Their consumption is going to increase from 31.5 million bales to 32.5 million bales.”

Chinese imports will still be strong at 5.5 million bales, but that’s down from this year’s 9 million bales. “They have to balance their carryover stocks with the volume of consumption that they have. India, Pakistan and Turkey will all increase consumption next year.”

e-mail: erobinson@primediabusiness.com

Column: Outlook Forum gives participants new slant on trade

USDA’s Agricultural Outlook Forum has become a good event for checking the pulse of the farm sector. Government analysts give their assessment of where the ag economy is headed and invite members of the private sector to take potshots at their numbers.

That was the case this year when Leslie Meyer presented USDA’s cotton forecast. Meyer said USDA believes China will import 7 million bales of cotton this year. Moments later, Gary Taylor, president and CEO of Cargill Cotton, said Cargill was predicting Chinese imports of 9 million to 10 million bales.

Sometimes, the administration tries to spin the numbers. This year, Keith Collins, USDA’s chief economist, gave an optimistic U.S. economic outlook that might not be shared by all of his peers. But there was little dissent with Collins’ forecast that U.S. agriculture has a better outlook than it had at last year’s Forum.

Speaking on Feb. 19, Collins predicted U.S. farm exports could reach $59 billion and might have exceeded the 1996 record of $60 billion if not for the discovery of the first case of mad cow disease in the United States.

Most Outlook Forums provide a new take on some aspect of agricultural trade. This year’s magic moment may have been Collins’ observation about the increasingly competitive nature of global commodity markets.

He noted that if you take the 2002 soybean exports of Brazil and Argentina, the coarse grain exports of China and the Former Soviet countries and the wheat exports of India and the Former Soviet countries you have a total of 85 million metric tons of grain. Those countries exported less than 10 million tons in 1994.

A close second might have been his comments on China. In 1997 or 1998, the Forum was rife with predictions of how much grain China would have to import to feed its population. Instead, China embarked on a program of self-sufficiency that made it a grain exporter.

Now China may be coming full circle, buying large quantities of U.S. soybeans and cotton. "The question, Collins said, is: "are we at the long-awaited turning point where China focuses resources on more labor-intensive crops and becomes a more sustained importer of bulk crops?"

Then, there’s Brazil. "Most people know Brazil has increased its soybean planted area by 25 million acres since the mid-1990s," he said. "But Brazil is not just soybeans. They have increased production of cotton, soybeans, broilers, pork, corn and beef by 25 to 75 percent since the late 1990s.

"While I am portraying a positive economic picture for U.S. production agriculture in 2004," he said, "that optimism should be tempered by potential consequences of the continued production growth of Brazil and other emerging competitors."

Cargill’s Taylor, who gave a cotton merchant’s perspective on China, also offered this take-home nugget: "It doesn’t matter what the United States does to reduce textile imports from China – they (Chinese manufacturers) will just move to Indonesia (or some other low-cost labor country.)"

e-mail:flaws@primediabusiness.com

Book traces Virginia cattle industry

A coffee table-quality book telling the story of the history of Virginia's cattle industry will be published and made available for public purchase this year. This exciting project is jointly sponsored by The Virginia Cattlemen's Association and The Virginia State Dairymen's Association.

Never before has a history of the beef and dairy industries in Virginia been researched and preserved in a comprehensive book format. The creation of this quality book will cover four centuries — from the founding of Jamestown to the present.

It will include historic facts and fascinating stories, interesting side bars, and intriguing illustrations and photographs of the industry's cattle and people.

With the knowledge of the significant contributions made by the cattle industry to Virginia's people and the state's economy, the directors of the Virginia Cattlemen's Foundation felt that it is important to capture the industry's history. The history project was implemented not only as a tribute to the industry, but as the first major development project sponsored by the Foundation.

In order to be comprehensive and include both beef and dairy, the Dairy Foundation of Virginia became involved with the project. The Foundations of the two sponsoring statewide industry associations provide a mechanism for the procurement, management and disbursement of funds. The Foundations promote and support education and leadership for people and enhancement of their cattle industry.

The history project is managed by an Editorial Board, chaired by John Mitchell of Hot Springs, owner of Falling Springs Ranch, a purebred Salers, Angus and commercial cattle operation.

Other Board members include James Bennett of Red House, owner of Knoll Crest Farm; Ernie Reeves of Mount Solon, owner and manager of Mossy Creek Farm; Nelson Gardner of Bridgewater, a leader in the dairy industry and retired dairyman and Bill Harrison of Leesburg, a retired dairy Extension agent and dairyman.

Support to the Board is provided by Ike Eller, Animal Science Professor Emeritus, who serves as Advisor and Development Director; Debbie Snead, Director of Marketing; and Patty Douglas, Recording Secretary.

An impressive group of leaders in Virginia Agriculture make up the project's Advisory Board.

The Advisors include Carlton Courter, Commissioner of the Virginia Department of Agriculture and Consumer Services; Andy Swiger, dean emeritus, College of Agriculture and Life Sciences, Virginia Tech; Rodney Phillips, administrator of the Virginia Milk Commission; Reggie Reynolds, executive secretary of the Virginia Cattlemen's Association; Dale Gardner, executive secretary of the Virginia State Dairymen's Association; Steve Nickerson, head of Virginia Tech's Dairy Science Department; Ike Eller, animal science professor emeritus, Virginia Tech, and Mark McCann, head of Virginia Tech's Department of Animal and Poultry Science.

McCann is chairman of the Board which serves as advisor and advocate for the project.

The authors of the history book are Nancy Sorrells and Katherine Brown of Lot's Wife Publishing Co. of Staunton, Va. Both are experienced historians and have considerable experience in researching and writing agricultural and other histories.

Kenneth Koons, professor of history at Virginia Military Institute, is serving as editor. Koons and the authors work closely with the Editorial Board as they conduct research, write, edit, and manage the publication and printing of the book.

If you have stories, photos or other information to offer the authors, you may contact them at the following address: Lot's Wife Publishing Company, P.O. Box 1844, Staunton, Va. 24402, Phone: 540-377-6390.

North Carolina Farm Bureau president urges tobacco compromise

The president of the North Carolina Farm Bureau is calling on cigarette makers to work out differences over a tobacco buyout bill.

Last year’s push to pass tobacco buyout legislation fell short due to differences over Food and Drug Administration regulation of cigarettes. Philip Morris, the nation’s largest cigarette manufacturer, supports a buyout linked to FDA regulation. Other tobacco companies, including R.J. Reynolds, oppose FDA regulation. Reynolds mounted a campaign against a buyout last year.

"I urge cigarette manufacturers to work closely together to remove the impediments that prevented buyout legislation from being achieved in 2003," says Larry Wooten, president of the North Carolina Farm Bureau Federation.

Wooten said North Carolina tobacco farmers are in a "dire predicament."

The facts are hard to ignore, he says. Flue-cured growers have seen more than 50 percent of their quota cut since the late 1990s.

"We cannot continue to ignore the facts and hope that everything will be okay," Wooten says. "Tobacco’s crisis is North Carolina’s problem."

Flue-cured farmers go into 2004 with yet another cut in quota. The announcement of a 10.45 percent cut in quota for 2004 came in December. A 22 percent cut had been expected based on the numbers. Only a last-minute intervention by the Flue-Cured Tobacco Cooperative Stabilization Corporation prevented the full effect of the cut.

"It’s crisis time on the farm," Wooten says. "North Carolina’s rural economy is seeing millions of dollars in tobacco income disappear overseas — primarily to Brazil. It is out of control, and it hurts family farms, rural communities and North Carolina’s economic recovery. The only realistic answer to this crisis is a complete buyout of the existing program."

Tobacco sources say talks have been under way to move tobacco legislation forward in 2004. In 2003, the cornerstone of the legislation was $8 for quota owners and $4 for growers. In 2004, $5 for quota owners and $2 for growers has been mentioned.

Growers were optimistic at the beginning of last year, working through differences at the state level to emerge with a consensus to get a tobacco buyout passed through Congress.

Several bills were introduced or re-introduced in Congress last year.

The sticking point came with disagreements about FDA regulation of cigarettes. Cigarette makers would be assessed a fee based on their market share to pay for the buyout. Reynolds says FDA regulation would lock in Philip Morris’ market share. Before its announced merger with B&W Tobacco Corp., Reynolds said the assessment would be more than its profits.

Tobacco-state senators tried to move the bill through an omnibus appropriation bill. Last-minute efforts led by U.S. Sen. Elizabeth Dole, R-N.C., to include a $7.2 billion plan into a spending bill, fell short.

In the U.S. House, members who represent tobacco states reached consensus on a tobacco buyout bill, forging a compromise from several bills. The $15.7 billion bill had $8 and $4 as its cornerstone. FDA regulation of cigarettes was dropped from the bill. While they said FDA regulation was key to passage of a tobacco buyout, legislators tried to link it to a separate bill.

A move to push FDA-less legislation met with stiff opposition.

A spokesman for the Campaign for Tobacco Free Kids believes there’s a better than ever chance for the buyout to pass this year.

e-mail: cyancy@primediabusiness.com

Senator revives energy policy bill

New Mexico's Sen. Pete Domenici has introduced a new, leaner energy policy bill after the Senate majority and minority leaders agreed to allow the bill to be considered swiftly and with as few amendments as possible.

The energy policy bill, which would provide incentives to boost ethanol production substantially in coming years, had been stalled in the Senate since early December for lack of enough votes (60) to bring cloture to a sometimes raucous debate on its provisions.

Following its introduction, Majority Leader Bill Frist, R-Tenn., and Minority Leader Tom Daschle, D-S.D., submitted a colloquy into the Congressional Record that outlines the agreement.

“I worked closely with leadership to make sure this energy bill addresses our energy challenges, achieves the same goals the old bill did and creates as many new jobs. It does,” said Domenici, chairman of the Senate Energy and Natural Resources Committee

“We cut costly provisions, we didn't cut jobs,” he added. “I was particularly concerned about protecting the new jobs created in the near-term. We've done that. The tax incentives for renewable energy, coupled with the ethanol, clean coal and natural gas provisions create every single job the old energy bill would have created. They create them as swiftly as the old bill would have done.”

The estimated cost of the new Domenici bill, S-2095, is less than $14 billion, taking into account a $1.25 billion savings in the authorizing portion of the package. The new bill costs less than half of the estimated $31 billion cost of the old bill that passed the House in November.

The leaner energy bill includes the tax package passed by the Senate Finance Committee last May. The estimated cost of the tax package is reduced to below $15 billion by delaying the implementation of most provisions until later this year.

“We shaved off half the cost and still pump more than 800,000 new jobs into our economy,” said the New Mexico Republican. “The ethanol provision alone will do more to bring new life to rural America than anything that has passed through Congress in the last two decades.”

“I commend Majority Leader Frist and Minority Leader Daschle for their work to pave the way for a swift Senate vote on this bill,” Domenici said. “I think this bill addresses the concerns several senators had with last fall's conference report. I agree with the leaders that we want to move quickly to a vote on this bill with a minimum number of amendments. I look forward to floor consideration shortly after we return from the recess.”

National Corn Growers Association leaders applauded the action by Domenici and the Senate leaders, saying the future of renewable fuels had brightened significantly.

“We're finally seeing the light at the end of a very long tunnel on RFS,” said Dee Vaughan, the NCGA president and a corn grower from Dumas, Texas. “But we're not there yet — floor amendments are always a possibility. We urge the Senate to vote the bill through as soon as possible.”

He noted that besides being a new, slimmed-down energy bill, the legislation still contains a 5 billion-gallon renewable fuel standard and a small producer tax credit along with the volumetric ethanol excise tax credit (VEETC).

Vaughan also commended the Senate for passing the highway reauthorization bill, which includes VEETC. The tax credit will generate more than $2 billion per year in additional Highway Trust Fund revenues and maintain an important incentive for the use of renewable fuels. VEETC allows greater refinery flexibility in blending ethanol and eliminates criticism that ethanol robs the Highway Trust Fund.

“Through letter-writing campaigns, visits to Washington, D.C., and other grassroots efforts, corn growers have lobbied tirelessly for the inclusion of RFS and VEETC in energy legislation,” said Vaughan. “It appears as if that work is finally paying off.

Besides slashing the bill's price from $31 billion to $14 billion, Domenici removed several other provisions from the bill, including the MTBE safe harbor provisions that had proved to be a major stumbling block for Democratic senators.

Farms poised for prosperous year

The U.S. economy — and with it, the U.S. farm economy — had a “very positive” year in 2003 and appears poised to experience another sound and prosperous year in 2004, according to USDA's chief economist.

Speaking at USDA's Agricultural Outlook Forum in Arlington, Va., Keith Collins said that after several years of a weak and variable global economy, 2003 saw the U.S. economy pull itself together and begin a recovery, with the economy growing 3.2 percent.

“The pump has been primed with liquidity, expansionary fiscal policy, resulting from the budget deficit and the Jobs and Growth Act of 2001, the lowest interest rates since the 1950s and, during the second half of the year, increasing business fixed investment,” he said. “With these factors all in place again in 2004, combined with an expectation of even stronger business investment spending, a depreciating dollar, few signs of inflation and stronger foreign economic growth, macroeconomic forecasters foresee GDP growth of 4.5 to 5 percent. This together with stronger employment should provide a large and growing domestic demand base for farm products.”

Collins said foreign GDP is expected to grow about 3 percent in 2004, after averaging less than 2 percent annually over the past three years.

“Japan is finally growing, and Asia and Latin America are expected to propel developing country growth to the highest rate in four years. With the European economies lagging, foreign economic growth likely will not push over the 3 percent line, which has often been a level associated with an upward surge in U.S. farm exports.”

The improving domestic demand base is reflected in the demand for food, which also drives demand for animal feed, said Collins, who gave the traditional “Outlook for the U.S. Farm Economy” for the estimated 1,400 participants in this year's forum.

While monthly retail sales of grocery stores, food and beverage stores and food service establishments typically run higher than year-earlier sales, the U.S. economic slowdown in 2002 noticeably slowed sales, he noted.

“As the U.S. economic recovery took hold in 2003, sales moved up nicely and strong sales are again likely for 2004,” he said. “Of course, the types of products consumers have been purchasing are changing as attitudes toward diet and health change.”

Collins said domestic industrial demand for farm products is also looking up. “As an example, monthly ethanol production is setting new record highs almost every month. In 2004, U.S. ethanol production should reach 3.25 billion gallons and account for more than 1.1 billion bushels of corn use.”

USDA believes stronger foreign economic growth should translate into improved U.S. agricultural exports in 2004. The Agriculture Department's latest forecast puts 2004 farm exports at $59 billion, up $2.5 billion from fiscal year 2003.

“This forecast is $500 million below our previous forecast, which was published prior to the U.S. finding of BSE,” he said. “The new export forecast reflects, in part, the assumption that the markets that are now closed to U.S. beef exports will remain closed for 2004.

“This is not a forecast of what countries will do. It simply reflects our standard forecasting procedure to assume the policies of foreign countries remain in place until they are changed.”

Any U.S. export forecasts must also be tempered with the realization that new and emerging export competitors are playing an increasing role in world trade.

“To see this, add up the soybean exports of Brazil and Argentina, the coarse grain exports of China and the former Soviet countries and the wheat exports of India and the former Soviet countries,” he said. “These exports grew from less than 10 million tons in 1994 to about 85 million in 2002 — from 2 percent of world grain and soybean trade to 25 percent.”

Collins said the markets for most major crops are expected to be in close supply and demand balance for the remainder of the 2003 crop years and for the 2004 crop years.

“When prices are strong, we often see global supply roar back, overtake demand and prices plunge. While we should expect production rebounds in 2004 from last year's poor weather in Europe and the former Soviet Union, there are reasons to think global markets will remain robust.”

Chief of those is that there is a “strong foundation” under global grain demand, he says.

“For the 2003 crop years, global grain demand is expected to exceed global grain production for the fifth consecutive year. This gap means that by the end of the summer, global grain stocks as a percent of use will be at the lowest level since 1972 for wheat, 1981 for rice and the lowest on record for coarse grain. Stocks are also low compared with history for soybeans and cotton.

“With low stocks and the improving global economy, it is likely that even with a return to normal yields in the key producing countries, crop stocks will remain low and prices firm for most economies.”


e-mail: flaws@primediabusiness.com

Mid-South farm leader Rick Parsons dies

An active advocate for agriculture, Rick Parsons of Vance, Miss., died unexpectedly at his home Feb. 16. He was 56.

Parsons was considered by many of his Mississippi farming peers as “the ultimate farm manager,” and his death will leave a hole in the many state and national agricultural organizations he actively served.

Calling Parsons' death an “unfortunate tragedy,” Sen. Thad Cochran, R-Miss., says, “This is a great loss for the state. President George W. Bush appointed Rick to the State Farm Services Agency Committee three years ago, and he served very ably on that committee.

“He served with distinction, and he was a farm leader who was well-respected by everyone who knew him,” says Cochran.

Chip Morgan, executive vice president of the Stoneville, Miss.-based Delta Council, adds, “Rick was a progressive thinker when it came to farm policy, and was always a team player.”

Last year, Parsons was named the 2003 Lancaster/Sunbelt Expo Southeastern Farmer of the Year for Mississippi, and was presented with the North Area Cropland Conservationist Award by the Mississippi Association of Conservation Districts.

In addition, Parsons served on the board of directors for Delta Council, the Mississippi Boll Weevil Management Corp., Delta Wildlife, the Tallahatchie County Farm Bureau, and the Tutwiler Ginning Company. He was also an elder and Sunday school teacher at Sumner Presbyterian Church, a volunteer for Habitat for Humanity, a member of the Sumner Rotary Club, and president of the Tutwiler Ginning Company.

He was a member of one of the first Cotton Leadership Program classes and was a past Cotton Achievement Award winner.

Parsons began managing the soybean operation for S.M. Fewell & Company, Inc., in 1972. Under his leadership the Fewell Planting Company has grown to more than 9,000 acres of corn, cotton, wheat, soybeans and rice.

In a 2003 Delta Farm Press article, Parsons recalled his introduction to farming at the tender age of 11. “My grandfather introduced me to farming back in 1957. I chopped cotton. And if you've ever chopped cotton, you know what a tough job that is. 1957 was a very wet year in the Mississippi Delta,” he recalls. “I've never done anything that I hated so badly. I used to say that if I ever had a son, the first job he would learn on the farm is to chop cotton…and when it's wet.”

Parsons leaves behind his wife, Carlisle, and one son, R. Scott Parsons of Arlington, Va. Survivors include his mother, Kathryn B. Parson of Oxford; one sister, Laura P. Walker of Brentwood, Tenn.; two brothers, John R. Parsons of Memphis and J. Robert Parsons of Water Valley, Miss.; and one grandchild, Rae Elizabeth Parsons of Arlington, Va.

A memorial service was held Thursday, Feb. 19, at 2 p.m. at Sumner Presbyterian Church in Sumner, Miss. The family requests that memorials be made to the Sumner Presbyterian Church, P.O. Box 504, Sumner, Miss., 38957.