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Corn+Soybean Digest

U of I Extension Upgrades Web-Based Pest and Crop Development Information

Several upgraded features, as well as a new name, have been added to the Web-based version of the Pest Management and Crop Development Bulletin published by specialists from University of Illinois Extension.

The bulletin provides the latest information on pest situations and crop development issues for producers of major field crops in Illinois each week during the growing season.

"The web version has been renamed the Bulletin – pest management and crop development in Illinois," said Kevin Steffey, editor and entomologist with U of I Extension. "As in the past, subscribers will receive e-mail notification of the availability of the newest issue on the Web, which is usually posted on Thursday afternoons. This notification will provide subscribers with a thumbnail summary of each article in the new issue."

"Readers can also click on the 'resources' link to take them to a page from which other useful resources can be accessed," Steffey said. "This provides an instant link to valuable sources of information, such as other state newsletters, the Agronomy Handbook, and the current issue of the Illinois Agricultural Pest Management Handbook."

He adds that the new electronic version has a function that will allow users to search by author, subject area, keyword, or by specific words in the text.

The electronic version of the bulletin is located on the IPM Web site for the U of I's Department of Crop Sciences at http://www.ipm.uiuc.edu/bulletin. Subscription is free and only takes a few minutes.

Corn+Soybean Digest

On-Farm Study Confirms Benefits Of Planting SCN-Resistant Varieties

Many growers have been hesitant to plant varieties with resistance to soybean cyst nematode (SCN) because of the potential for so-called yield drag. This has been especially true for fields with no visible signs of SCN damage.

But according to a recent on-farm study at the University of Illinois conducted with funding from the Illinois Soybean Checkoff Board, nearly all growers in the state would probably benefit from planting SCN-resistant varieties.

"There has been a lot of concern by growers because of the history of resistant varieties not producing well on ground that does not have SCN," said Greg Noel, USDA nemotologist in the Department of Crop Sciences at the U of I. "The reality is that there are probably very few fields in Illinois that do not have at least some cyst nematodes in them."

Noel has conducted two years of on-farm trials at seven locations in central Illinois and western Indiana on fields ranging from no infestation to moderate levels of infestation by SCN. Each field was planted with a susceptible variety, a variety with low levels of resistance from the Fayette line, a variety with higher levels from the same line, and a variety with the Peking line of resistance.

"These trials were carried out on farmers' fields, and all operations were done with their own equipment," Noel said. "Each variety was planted the full length of the field, randomized and replicated three times. Yield was determined with a weigh wagon, and moisture was corrected to 13 percent."

Although yield-drag up to 10 percent from resistant varieties was confirmed in fields with no nematodes, the study pointed to a major difficulty in making the determination that nematodes are not present without extensive testing.

The study further confirmed that planting resistant varieties most often paid off in fields with even low levels of SCN infestation.

"At some locations where we found no nematodes prior to planting, we sampled that same site at harvest and found fairly large numbers of nematodes," he said. "That means there is a lot of error in undertaking the common methods used in sampling for nematodes."

He notes that growers can have yield losses as high as 10 to 15 percent from nematodes in fields where there are no outward signs of damage. In most cases, those fields appear to the eye to have completely filled-in rows and to be growing perfectly well.

"Part of the dilemma that growers face is the fact that there is no accurate way of telling what numbers of nematodes they have in a particular field," Noel said. "In our experiments, we took four samples of 20 cores in each round, for a total of 48 samples and 960 soil cores in each field.

He points out that current recommendations for sampling just do not adequately represent what's in the field.

"It's not anyone's fault," Noel said. "In order to rectify the situation, a grower would have to spend a lot of money and take a lot of samples, which is just not worthwhile economically."

According to Noel, growers who have any history of SCN problems should always plant SCN-resistant varieties. Even those with no clear signs of a problem should also strongly consider planting a resistant variety as a form of no-cost insurance.

"Although yield drag does occur in fields with zero or low nematode populations, the problem is trying to determine whether or not you have a low population," he said. "The troubling thing is that you can have a fairly significant yield loss from SCN and not even know you have it. In those cases, a resistant variety would certainly pay off in higher yields."

Despite the problems with sampling, Noel suggests that growers can take some simple steps to improve their chances for selecting the proper variety for their fields.

"One way is to monitor the yields as you move through a field," he said. "By checking the yield monitor, you can look for drop offs and then flag the area. Then you can come back to those areas and take samples for SCN during the fall."

Noel adds that valuable information is also available from the Varietal Information Program for Soybeans (VIPS) maintained at the U of I. This database provides unbiased information on soybean varieties from a wide range of companies, including evaluations of resistance against various nematode populations. The varieties entered in the trials were tested at 13 different sites around the state of Illinois.

There were 134 conventional varieties and 661 Roundup-resistant varieties from 70 companies in the 2003 soybean trials. Besides those entered by participating companies, the total number of soybean varieties included 244 that were nominated by Illinois farmers and entered directly by the Illinois Soybean Checkoff Board.

"Growers can easily use this invaluable resource to help make an informed decision on what specific varieties to plant," Noel said. "I would suggest finding the test location near where a grower lives and identifying a resistant variety that has the highest level of resistance and the highest yield."

The information from the VIPS database is available on the Internet at http://www.vipsoybeans.org/.

Corn+Soybean Digest

Farmers may need to return government payments

Farmers who accepted the first advanced Counter-Cyclical Payment (CCP) last fall for the 2003 crop may need to give it back. The reason is the increase in corn, soybean and wheat prices, says Gary Hachfeld, regional educator with the University of Minnesota Extension Service.

The CCP advance for corn was $0.077 per bushel; for wheat it was $ 0.031. Prices were high enough for soybeans that there was no advanced CCP made. “Producers will be receiving or may have already received a letter from the Farm Service Agency (FSA) alerting them to the repayment issue,” Hachfeld says

The refund policy offers two options for repayment. Option 1 allows producers to essentially do nothing, and the repayment will be subtracted from their 2004 final Direct Payment (DP) and/or the 2005 crop DP to be made in fall 2004. The producer will not have to write a check to the Commodity Credit Corporation (CCC) and there will be no interest charge on the repayment amount. A repayment statement will be issued showing the producer has satisfied the obligation. Option 1 is the default option and the producer does not need to take any action for the repayment to be made automatically.

Under Option 1, the producer will have more than enough DP funds to cover the cost of the CCP repayment. The total DP for corn is $ 0.28 per bushel; and for wheat the total DP amount is $ 0.52 per bushel. The 2004 final DP payment is half that, and the advance DP for 2005 is also half that amount.

Together, the DP amount is well above the CCP advances that may need to be refunded to FSA. To calculate the repayment amount, multiply the DP/CCP contract acres by the DP/CCP yield times .85 times the CCP advance amount.

Producers have a second choice for repayment. Under Option 2, the producer will be subject to the Debt Collection Improvement Act of 1996 (DCIA). The producer will be sent an initial notification of the repayment obligation followed by a first demand letter 30 days later. At that time, producers can settle the obligation by simply writing a check to CCC. If payment is not made within the 30 day period following the first notification, a second demand letter will be sent and at that time interest will begin accruing.

In order for a producer to select Option 2, they will need to notify their local FSA Office by June 15, 2004.

Exact overpayment amounts won’t be known until the end of the commodity marketing period, Hachfeld says. Those periods are July 2004 for wheat and October 2004 for corn and sorghum. Once the end of the marketing year arrives, the final repayment amount will be calculated. Producers will then need to make the repayment, if warranted.

If producers did not elect to take the 2003 crop advanced CCP, they will not receive the FSA letter and won’t have to make a repayment. If you have questions, Hachfeld says you need to contact your local FSA office.

Corn+Soybean Digest

New Resistant Gene May Protect Soybeans from Phytophthora Root Rot

Soybean farmers may soon have more protection against Phytophthora root rot, the second leading cause of soybean yield loss in the U.S.

Through research funded by the Ohio Soybean Council and the soybean checkoff, scientists from the Ohio Agricultural Research and Development Center (OARDC) discovered a new soybean gene, Rps8, which offers resistance to Phytophthora root rot. Phytophthora is a pathogen that can infect soybean plants at all stages of growth, causing seed and seedling decay, root rot and stem rot. In early testing of the Rps8 gene, results have been positive.

The gene was tested in 50 Ohio locations and throughout the Midwest during the 2003 growing season. Rps8 has protected soybeans from Phytophthora where as other genes have been lacking resistance.

Scientists are now trying to locate markers linked to the gene to help breeders incorporate this source of resistance into new soybean varieties.

Corn+Soybean Digest

The Road Warrior of Agriculture

Managing the Extremes

One of the main points in my speeches is that managers of any business will be required to have strategies that can be deployed when extreme conditions occur. Some of you may say this is managing business cycles.

I indicated in a recent meeting that producers would go from the best year they ever had one season to the worst year in the next. A seasoned board member indicated this occurrence was nothing more than what farmers had to manage through in the past. My response was that his sons and daughters would see higher degrees of extremes.

For example, soybean, beef, and now dairy enterprises are experiencing an extreme up-cycle. In some cases, I have overheard soybean producers say that it is different this time and we may be experiencing a trend. Did we not hear that just before major declines in the stock market and general economy a few years ago?

The point is that some of the poorest management decisions are often made during good economic times. There is a reason that land values are reaching extreme levels and John Deere is reporting record profits. Yes, you can grow and expand your businesses, upgrade equipment and facilities in good times. However, make a point now that prices are strong to build some working capital and cash, and get your balance sheet in order through prepayment of principal. It is these types of decisions that will assist you if prices rapidly decline or costs spike.

Side Notes

  • Each Monday for 21 weeks I’m trekking to Omaha, NE, to present a session on change in agriculture and agri-lending to Farm Service Agency employees. They are embarking on automating their old Farm Home Plan using computerized software by ECI, a technology company in Glenwood, IA. After eight meetings, I’d have to say that this is the most enthusiastic set of government employees I have assisted in training in my 30 years. I tip my hat to them and to the agency.
  • My parents were one of the original farm families nationwide to utilize the Farm Home Plan in upstate New York more than 65 years ago. While they were sometimes critical of the paperwork and record keeping required, it is probably one of the reasons their family business continued to thrive, and a reason for my interest in agricultural finance!


My e-mail address is:sullylab@vt.edu

Editors' note: Dave Kohl, The Corn and Soybean Digest Trends Editor, is an ag economist specializing in business management and ag finance. He recently retired from Virginia Tech, but continues to conduct applied research and travel extensively in the U.S. and Canada, teaching ag and banking seminars and speaking to producer and agribusiness groups.

To see Dave Kohl's previous road warrior adventures type Dave Kohl in the Search blank at the top of the page.

This online exclusive is brought to you by The Corn and Soybean Digest

Corn+Soybean Digest

Thiesse's Thoughts

Northstar Ethanol Plant
The proposed Northstar Ethanol Plant, which will be located about two miles west of Lake Crystal, MN, is getting closer to reality. Both the Minnesota Pollution Control Agency (MPCA) and Blue Earth County are in the final stages of the permitting and zoning process. MPCA held a public information meeting in Lake Crystal on May 18.

Various MPCA staff reviewed the Environmental Assessment Worksheet (EAW) for the proposed ethanol plant. They also reviewed state and federal permit requirements for air quality, water discharge, storm water runoff, and above ground storage tanks that are required before the project is approved. Highlighted provisions related to noise and the steam emissions from the proposed ethanol plant were also reviewed.

MPCA staff said the EAW and permit applications submitted by Northstar Ethanol, LLC, appear to have met all regulations and requirements.

Enough Rain
As typically happens in the spring in Minnesota, there is “fine line” between too little rain and too much rain. Many portions of South Central Minnesota have now about reached the point of “too much rain”, after receiving 3-4 inches of rain, or more, during the week of May 17-24.

Rainfall amounts were quite variable, and generally were less in northern parts of the region. There has been enough precipitation to replenish some of the stored soil moisture reserves in the areas with higher amounts of rainfall, which should be beneficial later in the growing season.

The higher rainfall amounts have also lead to some standing water in fields, especially in extreme Southern Minnesota, and across the border in Iowa, where severe storms brought several inches of rain in a short period of time.

Some crop replanting will likely be necessary in portions of this area, due to the excess rain and hail damage. Most farmers would now welcome an extended period of weather that is warmer and drier than normal for a couple of weeks to enhance crop development and allow for timely application of post-emergence herbicides.

There are also isolated corn and soybean fields that will require replanting from the frost damage that occurred on May 15 across much of the region. Most corn and soybean fields should recover from the frost damage, once we get more favorable growing conditions. The most severe frost damage was on field edges, in peat soils, and in the river bottoms.

Producers with reduced stand counts from frost, hail, or excess rain should contact their crop consultant or agronomist to assist with replant decisions. If replanting is necessary, producers need to contact their Crop Insurance Agent regarding replant provisions in their insurance policies.

Editors note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN. You can contact him at 507-726-2137 or via e-mail at kent.thiesse@minnstarbank.com.

Corn+Soybean Digest

Brock Online Notes

China Processors Seek Help

China's financially strapped soybean processors are appealing to U.S. grain companies to help keep them afloat by accepting measures such as deferred payments to avoid defaults, U.S. traders told Reuters News Service Thursday.

The processors, many of whom signed agreements in Chicago five months ago to buy 2.5 million metric tons of U.S. soybeans, are also telling the companies they want more say over prices since China has become the world's top soybean importer, Reuters reports.

Traders said China's Soybean Importers Chamber of Commerce has circulated a draft letter seeking feedback from exporters on measures proposed by the government-sponsored body, which led the soy-buying mission to Chicago last December.

A translated copy of the letter obtained by Reuters states Chinese soybean crushers have been suffering financial losses for seven months due to a credit crunch, excessive purchases of high-priced soybeans and poor margins.

“Some of our members might request to cancel, delay payment, delay shipment, resell or wash out (their contracts). It is expected your companies could cooperate as much as you can to help the companies pull through," it said.

U.S. grain traders said losses on previously priced, but undelivered soybean cargoes are at the core of the Chinese industry's complaints. "This is just a trade ploy," said one trader with a global grain trading company who had seen the letter.

He also brushed aside the chamber's proposal that exporters should agree to price their sales to China on soybean futures at China's 10-year old Dalian Commodity Exchange instead of at the CBOT, the world's largest commodity exchange.

"The pricing point for the world's trade in soybeans is Chicago," the trader said, acknowledging that the proposal was aimed at prices better reflecting soy values in China, the demand side, rather than in the U.S., the top exporter.

The chamber, which says its 15 members account for 90% of China's soybean crushing capacity, said in the letter "our vast members find from their own experience that there is obvious bug in the pricing system" based on the CBOT.

Editors note: Richard Brock, The Corn and Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

To see more market perspectives, visit Brock's Web site at www.brockreport.com.

Transgenic cotton train will stop in California this trip

The transgenic freight train that barreled through the U.S. Cotton Belt in the mid-90s drove right through the California station.

However, the train is coming back around again with an even bigger load of newer biotechnology. It will stop in California this time, according of Roy Cantrell, vice president of agricultural research for Cotton Incorporated.

The question is will the transgenic traits it drops off for use in San Joaquin Valley cotton carry the unwanted baggage the rest of the U.S. Cotton Belt got on the first trip through.

Cantrell, former New Mexico State University cotton breeder who has worked closely with Acala and Pima cottons, did not mince his words at the 6th Pima Production Summit in Visalia, Calif.: Fiber quality suffered in all areas of the cotton Belt — except California — when the first round of transgenic traits were put into many U.S. cotton varieties.

Cantrell is not anti-biotechnology. It holds tremendous potential to help producers grow cotton cheaper, he said, and now using DNA marker technology it holds great promise to actually improve cotton fiber quality.

Nevertheless, fiber quality suffered at the expense of biotechnology during the first wave of transgenics, a pitfall he said California must avoid at all cost.

California has an unparalleled reputation for the highest quality uplands (Acala) and Pima cottons in the U.S. "You are fortunate here in a California that you have had a very successful, long history of sustained improvement and preservation of identifiable quality," he said. "It is quite admirable." He gave credit for it to the San Joaquin Valley Cotton Board and Supima.

"That kind of quality preservation is extremely important in the export markets we deal with today," he added.

Over the past decade, California has not seen stagnation of yields and erosion of fiber quality experienced by rest of cotton belt, he said.

He warned, however, that taking that for granted can lead to disaster in what he said is a rapidly changing cotton world.

"California is on the verge of wide scale transgenic adoption. You are where the rest of the belt was in the early 1990s," he said.

The first wave of transgenic centered around two biotechnology traits, worm resistance using a Bt gene and herbicide resistance. There was no economic incentive to introduce that initial Bt gene into SJV Acala cottons because the worm pests it controlled were not a problem in central California.

The initial herbicide resistant technologies were introduced into some SJV cotton and as much as 40 percent of the valley has been planted to herbicide-tolerant cottons.

However, the next generation of Bt genes offer control for some of the worm pests like beet armyworm and cabbage looper that can cause damage SJV cotton.

However, the next generation of Roundup Ready cotton ("Flex") is being eagerly awaited. It will widen the timing window for Roundup applications to later in the plant life. This is expected to be more popular in the irrigated West where the current Roundup Ready technology is viable only up to the fourth leaf, it can interfere with irrigation and cultivation. Cantrell predicts "massive adoption" of Roundup Ready Flex technology when it becomes available.

However, he warned "you cannot let quality erode in Pima and Acala cottons at a time when demand for your product is actually increasing," said Cantrell.

"You cannot assume that just because you have good conventional varieties that when you put traits in them they will remain the same," he said. "If you do not try to improve fiber quality at the same time you are introducing transgenics, fiber quality does not stay the same -- it gets worse."

There are two critical reasons to continuing improving California cotton fiber quality; one is increasing competition from manmade fibers edging ever closer to being cotton-like. And secondly, the rest of the U.S. Cotton Belt has rebounded from the fiber quality dip of the mid-90s and quality is once again inching toward SVJ staple length and strength.

Cotton Incorporated is spearheading a rejuvenation of public cotton germplasm development, an area Cantrell said has suffered for years, especially during the transgenic era. Research by USDA-ARS geneticist Mauricio Ulloa at the UC Research and Extension Center at Shafter, Calif., is part of that effort. CI is also helping fund work at UC Davis.

It will be an even bigger challenge for breeders to improve quality because cotton is on a "technology treadmill. There is more GMO material in cotton than any other commercial crop," he said, and there will be more in the future, Cantrell predicting that there could be six or more different genes in the same cotton variety at the same time in the near future.

"Technology can be very beneficial...growers are demanding it...but you have to improve the variety at the same time," he said.

The "Holy Grail" of cotton biotechnology is resistance to sucking insects like lygus and whitefly. Cantrell said there is promising basic research working toward that goal. That would be a major breakthrough in California and Arizona.

"Several biotech companies are making progress in this area," said Cantrell.

"California is going down the right road" in continually improving Acala and Pima fiber qualities he said, but he added it is "easy to stop in the middle" when the transgenic train arrives in California. "I am optimistic you will be able to continuing advancing fiber quality as you have in the past"

e-mail:hcline@primediabusiness.com

Commentary: Sen. Grassley shows his tenacity on Medicare bill

Anyone who thinks Iowa Sen. Charles Grassley will grow tired of wrestling with payment limits and move on to other issues should read his May 10 newspaper column. The article dealt with Medicare, but his opening sentence showed the tenacity Grassley brings to legislation he considers important.

“If at first you don’t succeed, try and try again,” he said. “This sage bit of wisdom certainly rings true in the nation’s capital. Trust me. I’ve been around the block enough times in Washington to know not to give up on what’s right.”

Grassley noted his efforts to modernize Medicare, which culminated in the reform bill that Congress passed last November, took years to deliver. “Once I sink my teeth into an issue, I’m in it for the long haul. Just ask the Pentagon, the IRS or the FBI. Federal agencies know by now that I take my congressional oversight responsibilities seriously. The same goes for lawmaking.”

He didn’t mention southern farmers who cringe when they read about another attempt by the senator to attach his payment limit amendment to another “must-pass” piece of legislation.

Grassley suffered a reversal in his latest bid to impose stricter payment limits when the House passed its 2005 budget resolution 216-213 May 19. In a press release, Rep. Randy Neugebauer, R-Texas, said he persuaded House Budget Chairman Jim Nussle to remove Grassley’s payment limit language from the budget plan.

“I am especially pleased Mr. Nussle agreed with me, and removed the amendment,” said Neugebauer. “That amendment would have allowed Sen. Grassley another avenue to push the payment limits change that goes against the commitment made to producers in the 2002 farm bill.”

Unfortunately, Grassley will consider the setback to be only temporary and will find another measure to attach the payment limit amendment to.

“Sometimes the pace in Congress reminds me of the turtle and the hare,” he wrote in the May 10 article. “Although I’d prefer to cross the finish line sooner rather than later, I take comfort knowing the right policy will prevail in due time.”

Grassley has done good things, including getting the Senate to pass the “Family Opportunity Act” he discussed in this column. But he needs to discuss his payment limit legislation with cotton and rice farmers to see the impact it could have when prices go flat again.

This column won’t be popular with those who think big farmers use those payments to gobble up more land. My grandfather’s farm had a 13.3acre cotton base back in the 1950s so I know what a small farm is.

But I don’t understand the fairness of denying payments to larger farmers just because economics led them to larger operations to cut costs and increase efficiency. Maybe some of us are a lot like Sen. Grassley in clinging to our beliefs. But I think we would at least be willing to listen to the other side.

e-mail: flaws@primediabusiness.com

NCGA president says re-opening farm bill jeopardizes corn growers

In testimony before the House Agriculture Subcommittee on General Farm Commodities and Risk Management, National Corn Growers Association (NCGA) President Dee Vaughan expressed concerns that Congress is considering re-opening the farm bill.

Citing farm programs as a true success story and a viable safety net for farmers, Vaughan, along with other commodity representatives, reiterated current farm policy allows farmers more predictability with their crops, better fiscal discipline and programs that limit assistance to the times when aid is most needed.

Vaughan noted U.S. corn growers find themselves in a much more favorable commodity market as a result of established farm programs that have attributed to the growth in ethanol production, increases in exports and record production levels. Therefore, he said, farmers need Congress to stay the course and resist opening the farm bill.

“Recent projections for the year’s corn crop indicate an increase of 800,000 acres to 71.9 million acres (harvested). Corn utilization is expected to climb by 100 million bushels to a record level exceeding 10.5 billion bushels. The outlook for corn is certainly encouraging, but growers continue to face serious challenges,” he said.

Mid-course changes, including proposals to further restrict farm support payments are extremely inequitable, Vaughan continued, noting that without the Farm Security and Rural Investment Act safety net, corn growers would face serious challenges and uncertainty in the marketplace.

He explained farmers face many risks year in and year out and the safety net of the counter-cyclical payment program protects U.S. growers when prices plummet. Further analysis is needed to insure the marketing loan program keeps pace with local market changes. In the end, farmers prefer to receive financial returns from the market.

Vaughan also touched on NCGA’s concern over conservation programs not being implemented and managed with the farmer in mind. Noting that common problems still remain, he urged the committee to look at the lack of outreach to growers, the domination of state technical committees by non-farm organizations or individuals, failure to recognize the economic challenges growers face, and minor conservation and environmental problems.

Vaughan also pointed out the underlying threat to corn growers throughout the U.S. — lack of a comprehensive energy package. “The bottom line is that rising energy costs and increased costs for seed and pesticides are largely responsible for driving up overall production expenses by over 6 percent in 2003. Just last year, the entire farm sector experienced a 30.8 percent increase in fuel expenses.”

Vaughan concluded, “Today’s farm bill enables corn growers to make further advances in food production, renewable energy and conservation practices that would not be possible otherwise. In fact, farm programs have helped to create new opportunities resulting in additional benefits for both producers and the American taxpayer.