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Articles from 2002 In June


COLUMN: Another media ambush

A few years ago, Hood sat for three hours, explaining a complicated research project on ultra-narrow-row cotton. He acted as if he had all the time in the world, when I knew he didn’t.

I’m sure he was just as cooperative when the Wall Street Journal’s Scott Kilman came to his farm near Gunnison, Miss., in early June to interview him about the new farm bill and its impact on the Delta.

And no one was probably more surprised than Hood when the article written by Kilman and the Journal’s Roger Thurow accused him of being responsible for the near-collapse of the economy in the West African country of Mali and the impoverishment of its farmers.

Hood said he started getting a bad feeling when he called Kilman the Saturday before the article was published on June 26.

“Scott had promised to send me a copy of the article before it appeared,” said Hood. “When I called, he said the article was on his editor’s desk, and that another editor was helping him co-write it. That’s when I started getting bad vibes.”

Kilman spent most of a day talking with Hood and touring the land Hood farms with his brothers, Curtis, Howard and Cary, in western Bolivar County. (Kilman also interviewed Ed Hester, who farms cotton, rice, soybeans and grain sorghum in southern Bolivar County.)

“I really think that Scott got waylaid on this,” said Hood, who is chairman of the National Cotton Council. “I don’t agree with everything in the part he must have written, but I think Thurow was responsible for most of the article.”

In it, the authors contend that the cotton provisions of the U.S. farm bill have caused a severe drop in cotton prices in countries like Mali, leading to economic hardship and the potential for unrest among its mainly Muslim population.

The authors contrast the plight of a 22-year-old Mali farmer trying to feed and clothe his family with an ox-drawn plow and 15 acres of cotton with Hood’s 12 $125,000 Case-IH tractors and 10,000 acres.

In a response posted on its Web site (www.cotton.org), the National Cotton Council ridiculed the article as incomplete and inaccurate in its depiction of the marketing system for West African growers.

The facts, it said, are that cotton prices are lower in most West African countries because of the extraordinary export taxes collected by their governments. It also noted that higher prices in the spring of 2001 and good weather had more to do with this year’s lower prices than U.S. farm policy.

Hood said Kilman has promised the Journal will print a response. Although reluctant to get into a contest with the newspaper, Hood said he would probably accept, a decision cotton farmers will applaud.

What’s at stake here is not just pointing out inaccuracies in an article, but protecting us from urban writers who would destroy a vital part of their country’s economy so that someone in West Africa can grow a few more pounds of cotton.

e-mail: flaws@primediabusiness.com

Mid-South cotton acres down 7 percent

Most of the reduction in acreage came in the Delta, which suffered through one of the worst planting seasons in history. The region was hit with cold snaps, wet and dry spells, flooding and frost, which led to massive replanting and abandonment.

USDA reduced its planted acreage forecast in the Delta by 285,000 acres from last month to 3.73 million acres. The biggest reductions came in Mississippi, which fell from 1.4 million acres to 1.18 million acres and Louisiana, from 660,000 acres to 580,000 acres.

Tennessee’s planted acreage remained unchanged from last month at 580,000 acres despite losing 26,000 acres to flooding this spring. USDA said Arkansas planted 1 million acres in cotton this spring and Missouri, 390,000 acres.

Producers in Texas planted 100,000 more acres than originally intended, according to USDA, while California growers planted 130,000 fewer upland acres than intended in March. Estimated acreage is 9 percent below last year.

According to Joe Nicosia, CEO, Allenberg Cotton Co., the acreage estimate is close to trade estimates of 14.5 to 14.6 million acres, “which is almost a non-event for the cotton market today.”

At that acreage, Nicosia projects a 17.3 to 17.4-million-bale crop, “with roughly a 20 percent abandonment in Texas.” The estimate is 1.2 million bales below what production would be at trend yields “which shows how much of the current crop condition is already in the market,” he said.

The worst possible scenario for cotton production is 16.7 million bales, he added. “We’re still in a million bale range.”

Asked if cotton acreage is still an issue, Nicosia said, “Yes, but the potential of this crop is what the market is looking at, which means weather.”

USDA projected U.S. corn acreage at 78.9 million acres, a 4 percent increase from 2001. Farmers reduced corn plantings 100,000 acres from their March intentions.

Persistent precipitation in the eastern Corn Belt prevented farmers from getting into their fields and limited the acreage planted to corn. However, states in the western Corn Belt almost offset the acreage decrease in the east as they experienced good weather and were able to plant more acres than originally intended.

USDA estimated soybean acreage at 73 million acres, down 2 percent from last year and up 27,000 acres from March intentions. Farmers reported that 83 percent of the intended soybean acreage had been planted at the time of the survey interview compared to an average of 77 percent for the past 10 years.

Some analysts questioned USDA’s adding to the corn acreage figure when they had subtracted acres due to adverse weather conditions in May. But they also acknowledged that USDA’s forecasts have generally proven to be accurate more often than not.

“You don’t win fight USDA’s numbers most years,” said an analyst.

e-mail: erobinson@primediabusiness.com

Mid-South cotton crop off to shaky start

Most of the reduction in acreage came in the Delta, which suffered through one of the worst planting seasons in history. The region was hit with cold snaps, wet and dry spells, flooding and frost, which led to massive replanting and abandonment.

USDA reduced its planted acreage forecast in the Delta by 285,000 acres from last month to 3.73 million acres. The biggest reductions came in Mississippi, which fell from 1.4 million acres to 1.18 million acres and Louisiana, from 660,000 acres to 580,000 acres.

Tennessee’s planted acreage remained unchanged from last month at 580,000 acres despite losing 26,000 acres to flooding this spring. USDA said Arkansas planted 1 million acres in cotton this spring and Missouri, 390,000 acres.

Producers in Texas planted 100,000 more acres than originally intended, according to USDA, while California growers planted 130,000 fewer upland acres than intended in March. Estimated acreage is 9 percent below last year.

According to Joe Nicosia, CEO, Allenberg Cotton Co., the acreage estimate is close to trade estimates of 14.5 to 14.6 million acres, “which is almost a non-event for the cotton market today.”

At that acreage, Nicosia projects a 17.3 to 17.4-million-bale crop, “with roughly a 20 percent abandonment in Texas.” The estimate is 1.2 million bales below what production would be at trend yields “which shows how much of the current crop condition is already in the market,” he said.

The worst possible scenario for cotton production is 16.7 million bales, he added. “We’re still in a million bale range.”

Asked if cotton acreage is still an issue, Nicosia said, “Yes, but the potential of this crop is what the market is looking at, which means weather.”

USDA projected U.S. corn acreage at 78.9 million acres, a 4 percent increase from 2001. Farmers reduced corn plantings 100,000 acres from their March intentions.

Persistent precipitation in the eastern Corn Belt prevented farmers from getting into their fields and limited the acreage planted to corn. However, states in the western Corn Belt almost offset the acreage decrease in the east as they experienced good weather and were able to plant more acres than originally intended.

USDA estimated soybean acreage at 73 million acres, down 2 percent from last year and up 27,000 acres from March intentions. Farmers reported that 83 percent of the intended soybean acreage had been planted at the time of the survey interview compared to an average of 77 percent for the past 10 years.

Some analysts questioned USDA’s adding to the corn acreage figure when they had subtracted acres due to adverse weather conditions in May. But they also acknowledged that USDA’s forecasts have generally proven to be accurate more often than not.

“You don’t win fight USDA’s numbers most years,” said an analyst.

e-mail: erobinson@primediabusiness.com

Increasing awareness and use of U.S. rice

Increasing U.S.-grown rice consumption by Americans is a primary goal of the USA Rice Federation’s (USA Rice) domestic promotion program. I’m pleased to share this update, which covers just a few ongoing domestic promotion activities.

National Rice Month

National Rice Month (September) is fast approaching. This year’s overall theme is “America’s going with the grain,” which helps convey the popularity of rice to consumers. NRM collateral materials and advertising for retail and foodservice will feature “Rice, you’ll love what it does for you!” The message is that retailers and foodservice operators will benefit from the promotion of rice through greater profitability, higher sales and increased traffic.

Our ad campaign began the first week of June with placements in leading supermarket trade magazines, and continues through August. The ads encourage participation in NRM, while raising awareness for the entire rice category. This cost-effectively reaches important decision makers.

Each year, USA Rice establishes cooperative promotional programs with three of the nation’s leading retailers. We leverage promotional funds provided by requiring retailers to advertise their branded and private label rice products during September and feature rice in off-shelf displays in the majority of their stores. H-E-B Grocery, one of the nation’s largest retailers with $9 billion in annual sales and more than 290 stores in Texas and Louisiana, and a small number in Mexico, is partnering with USA Rice for the third year in a row. The chain plans 30 scheduled ads for a combined circulation of 102 million and 2,380 rice displays for 295 stores. (More than 6,000 retail stores set NRM displays in 2001.) Consumers will be able to sample rice recipes at 600 in-store demonstrations.

In addition, numerous USA Rice members throughout the rice-growing states are involved in grassroots efforts to promote rice in their communities. This educates consumers about the many benefits of rice while increasing awareness of the importance of rice to our local economies. Comprehensive planning kits were distributed in June.

School Foodservice/Youth Promotions

USA Rice staffed a display booth at the Louisiana School Food Service Association Conference in mid-June. Nearly 1,000 school foodservice personnel attended. Visitors received rice foodservice recipes and bilingual rice preparation charts. They were also encouraged to enter our "Kid’s Favorite” recipe contest, which solicits kid-pleasing recipes featuring rice for future distribution to school foodservice professionals.

High school juniors and seniors whose families are directly associated with the rice industry in the states of Arkansas, California, Louisiana, Mississippi, Missouri and Texas, are encouraged to enter the National Rice Month Scholarship Contest. Students compete by running a promotion which celebrates National Rice Month in their community, with rice as the central theme. Twelve cash prizes are awarded based on creativity, impact, promotion of rice and National Rice Month, and demonstration of the importance of the rice industry to the local area.

The annual Miss Arkansas Rice contest, jointly sponsored by the Arkansas Rice Council and USA Rice Council, has a 40-year tradition of encouraging rice promotion among youth and publicizing the importance of the state’s rice industry.

Consumer Education Awards

This spring USA Rice captured top honors for corporate consumer education and communication materials from the International Association of Culinary Professionals. With 4,000 members in 36 countries and all 50 states, the IACP is the largest organization of food experts in the world. We submitted posters, recipe brochures and other materials designed to educate consumers about U.S.-grown rice.

USA Rice’s “Risotto: Causing a Stir” press kit was recently selected as an outstanding example of business communications in the Bronze Quill Awards contest, sponsored by the International Association of Business Communicators.

2002 USA Rice Outlook Conference

The 2002 USA Rice Outlook Conference, to be held Dec. 8-10 in Little Rock, Ark., is a great opportunity to visit with growers and others from all the rice-growing states, and learn about issues affecting the industry.

Joe Mencer, a Lake Village, Ark., rice producer, is a member of the USA Rice Federation’s Domestic Promotion Committee. He is also president of the Arkansas Rice Council.

Penn goes from critic to defender

For someone who was essentially a non-believer, Undersecretary of Agriculture J.B. Penn has become a high-profile defender of the Farm Security and Rural Investment Act of 2002.

Before he joined the Bush administration at the No. 3 spot in the Agriculture Department last year, Penn was strongly critical of the farm program provisions of the 1996 farm bill or Freedom to Farm.

Speaking at USDA's 2001 Outlook Conference, Penn talked about the “disconnect” between the $22 billion in ad hoc disaster payments that were supposed to bolster the ag economy and the fact that commodity prices continued to decline after those payments began in 1998.

Penn's subsequent appointment as undersecretary of farm and foreign agricultural services was thought to be a signal that USDA would be taking a “less kinder, less gentler” approach to farm policy.

That isn't how things worked out. Instead of holding the line on farm spending, as many expected, USDA and Bush administration officials endorsed the House Agriculture Committee farm bill's $73.5 billion increase, and Penn became a leading proponent.

Within days of President Bush's signing the bill, Penn spoke at a USDA briefing for foreign reporters, many of whose governments were trashing the new farm bill.

Asked about what would have happened had Congress not passed a new farm bill, Penn noted how U.S. farmers were being squeezed by increasing costs and rising land prices. “I think we would have had a considerable economic shakeout across farm country had we not seen a continuation of something on the order of the 1996 farm bill and something perhaps a little more, as occurred in this bill.”

Penn also has been USDA's point man on domestic media criticism, responding to such articles as a particularly caustic column by former Clinton administration economic adviser Laura D'Andrea Tyson in Business Week.

After first pointing out that Tyson's comparisons on the farm bill costs failed to recognize increased spending on disaster payments, Penn took issue with her criticism of the new law's trade provisions.

“Tyson's comments on the effects of the farm bill and international trade negotiations seem a bit overstated,” he said. “Our resolve to obtain further trade liberalization in agriculture and food production has not changed one bit. We will continue to provide vigorous leadership throughout the new trade negotiations.”

He also noted that both the European Union's and Japan's domestic support ceilings under the World Trade Organization agreements are significantly higher than those for the United States, a point Agriculture Secretary Ann Veneman has also made in her speeches.

(Interestingly, neither Business Week nor any of the other publications have had much to say after Veneman, Penn and other USDA spokesman have pointed out errors in their criticism of the new law.)

Does Penn's standing up for the farm bill signal a change in his thinking or the fact that he is a good team player whose ties to the farm community — he is an Arkansas State University graduate with a degree in agriculture — make him more sympathetic to farmers?

Penn hasn't said. For now, most growers are just glad he's on their side.

Soybeans under foot: soybeans meet the carpet industry

The United Soybean Board has worked with private industry to replace the petroleum-based products used in carpet backing with a newly developed soybean-based product. The move, according to the commodity group, has the potential to use 47 million bushels of U.S.-grown soybeans annually.

“This represents a very substantial market opportunity for U.S. soybean growers,” says, Eric Niemann, a farmer from Nortonville, Kan., and chairman of the United Soybean Board's new uses committee. “It's a win-win situation for both consumers and soybean growers. Consumers are getting a high-quality product made with a renewable home-grown resource, which lessens our dependency on foreign oil and uses the product of American soybean farmers.”

At a June 19 press conference at Universal Textile Technologies in Dalton, Ga., the United Soybean Board announced the new use for soy-based polyurethane — polyol.

Through the soybean check-off program, U.S. soybean farmers funded research to assist in developing the polyol, which can now be used to manufacture carpet backing. The soybean polyol is currently used in a variety of applications, including spray-on home insulation and truckbed liners.

Marketed under the trade name SoyOyl, it can be blended with petroleum products at no extra cost and has the potential for use in other carpet applications, such as cushioning and padding.

“About 70 percent of the carpet manufactured in the world is made in the three-county area around Dalton, Ga. In fact, about 1.6 billion square yards of carpet are produced in that area every year, so this is a very large opportunity for American soybean farmers to get their product in a commercial setting,” Niemann says.

Manufactured by Urethane Soy Systems Company (USSC) of Princeton, Ill., SoyOyl will first find a home in the artificial turf and commercial grade carpet markets. The soybean polyol will be blended with petroleum-based products to manufacture the backings of commercial carpets and artificial turf.

“They are using about a 17 percent blend of the SoyOyl now, but they have begun testing a blend of 80 percent soybean polyol and 20 percent petroleum-based products, and so far have been very pleased with the results,” Niemann says. “Our goal is for an 80 percent blend of SoyOyl in the production of all commercial carpet backings.

“About 23 percent of all carpet produced is commercial-grade carpet. If we could capture all of that market it would mean using the oil from 47 million bushels of U.S.-grown soybeans annually,” he says. “It takes approximately 1 pound of soybean oil to produce 1 square yard of commercial carpet backing, so piece of carpet 9 yards by 12 yards would use about 1 bushel of soybeans.”

Also new to the market, Dow Chemical Company has introduced Biobalance polymers and announced their availability for use in the carpet industry. The new soybean-based technology replaces a portion of the system required to make polyurethane carpet backing. Dow launched this innovative technology with Dalton, Ga.-based Universal Textile Technologies (UTT) at the June 19 press conference.

Biobalance polymers contain the soy-based polyol, SoyOyl. South Dakota Soybean Processors of Volga, S.D., supplies the soybean oil used to produce the soy-based polyol.

“Polyurethane backing systems have been the long-time choice for performance- and comfort-based carpet specifications,” said Tom Peeples, president of UTT. “Biobalance polymers utilize a renewable resource alternative, an important component toward reaching our environmental goals. We are pleased to be the source for polyurethane carpet backing incorporating Biobalance polymers.”

Recently, the U.S. Department of Agriculture became the first government agency to install carpet with the soy-based backing in its office. The federal government is the largest carpet purchaser in the United States.

Niemann says, “The technology is sound, the science is sound, and I believe this market will continue to grow as suppliers embrace this new product. The home carpet market is still using latex, and we hope to get into that market as time goes on, but so far our opportunity is limited to commercial-grade carpet.”

“Soybean farmers across the country should be proud of their check-off investment in SoyOyl,” he says. “USB has identified the carpet market as an opportunity to efficiently move more soybeans, and by funding the research and development of soy polyols, USB has effectively invested in the future of soybean farmers.”

The United Soybean Board is composed of 61 U.S. soybean farmers appointed by the secretary of agriculture to invest soybean check-off funds. The soybean check-off is a farmer-supported marketing and research fund collected on each bushel of U.S. soybeans sold. USB invests these funds on behalf of the 600,000 U.S. soybean farmers in activities specifically designed to increase the global utilization of U.S. soybeans and to reduce production costs. Check-off-funded investment areas include human and animal health and nutrition, research and development of new uses, and research to improve soybean composition and production efficiencies.


e-mail: dmuzzi@primediabusiness.com.

On risk list, pesticides at bottom

There were, in 2000, a grand total of 920 deaths in the U.S. that were attributed to poisoning. Guess how many of those were pesticide-caused?

OK, I'll tell you: 20.

But, wait: Of that number, 17 were people who deliberately ingested the materials, the majority of which were household pesticides. Of the three unintentional deaths, two were children who ingested pesticides, and the third person ingested an unknown pesticide.

Although farming consistently ranks among the three riskiest occupations nationally, the bulk of the deaths and injuries are from working around farm machinery and livestock.

In 1993, the National Cancer Institute, the National Institute of Environmental Health Sciences, and the Environmental Protection Agency, launched a long term research study on the health of farmers, farm families, and agricultural chemical applicators. It encompasses 90,000 participants in Iowa and North Carolina and seeks to evaluate the role of agricultural exposure to pesticides in the development of cancer, neurological diseases, and other chronic diseases. The study will take more than 10 years to complete.

Four years later, the American Crop Protection Association (now CropLife America) gave an unrestricted grant to the Harvard Center for Risk Analysis to analyze the study and provide an independent review of its methods, objectives, and accuracy. Three areas of weakness were identified and the Harvard Center's advisory committee has recommended additional studies to complement the Agricultural Health Study. Otherwise, the committee says, the vast amounts of data being collected will be difficult to interpret.

One of the charges long associated with pesticide use of all kinds is that it has resulted in an increased incidence of cancers; one area of the study is to determine if farmers, because of their exposure to pesticides, have a higher rate of cancer than the general population.

It will be interesting to see how the eventual results square with earlier studies that have shown no elevation in cancer levels in the farm population as a result of pesticide exposure. A 1998 analysis in the Annals of Epidemiology showed the only higher than average incidence of cancer among farmers was lip cancer, presumably the result of sun exposure. Otherwise, farmer cancer rates were 16 percent less than the general population.

Another study, the National Health and Nutrition Examination Survey, conducted by the U. S. Center for Health Statistics, showed that children in the families of farm workers were as healthy as, if not healthier than, those in the general population, and that there was no evidence that exposure to agricultural pesticides is causing adverse health effects.

It was noted that most farmers handle pesticides properly, using protective equipment/clothing/eyewear, and apply them according to label instructions. Further, pesticide packaging/handling innovations, including pre-mixed materials, closed delivery systems, and water-soluble packets allow pesticide use with virtually no user contact.

Dr. Robert Kreiger, a member of an expert panel of physicians and scientists evaluating pesticide safety, summed it up thusly: “When pesticide use results in harmful effects, the cause is almost inevitably human failure to heed instructions for use.”

Smith system: Corn forms cornerstone

According to folks who keep track of such things, “Smith” is the most common last name in North America. And “Tim” must rank right up there with the most common first names. Put them together, however, and you'll have the name of a most uncommon farm manager working fields in Holly Grove, Ark.

Tim Smith is an incredibly sharp fellow and it's safe to assume he's ahead of the learning curve. Despite his relaxed manner, he doesn't just give lip service when talking about improving his cropping systems. With agriculture, he's meticulous with research and voracious in his reading and studying. On Martin Farms, which he manages, Smith's commitment is obvious.

1: Corn into wheat

This year, Smith's corn crop looks to be exceptional, and there are reasons for that. “I've noticed that by planting the corn on stale beds with a wheat cover crop, the corn is holding up much longer between waterings. On one field, we have fresh beds with corn, and it's been hard to keep the corn from wilting from lack of water. So far on the stale beds, we haven't had any wilting or twisting of the plants,” he says.

In preparing for this year's crop, everything was ripped last fall using a DMI ripper at 12 inches deep (Smith's hardpan is at about 11 inches). Smith field-cultivated and ran fertilizer — some potash and zinc — on with approximately 90 pounds of cover crop wheat. A bedder/roller was used to form 60-inch beds. Smith then called it a year and waited.

“Normally, I burn those beds down in the spring. But rains this year kept hitting us, and I had to burn down behind the planter instead.

“On some of my corn acreage, I used a pint of Dual broadcast and 24 ounces of Roundup to burn the wheat down.”

Some of the wheat was over knee-high. Still Smith planted corn straight into it. It's harder to burn down and plant into wheat that tall, but a perfect stand of corn was the result. Oddly, the corn seems to be doing better in the taller cover wheat than the shorter, he says.

“On other cover wheat, I put Roundup on and went back with Basis Gold spiked with a little atrazine post.”

2: Corn into clover

Smith also had 140 acres of crimson clover cover. He burned the clover down with Clarity and Roundup. As with some of the wheat, the clover was knee-high and starting to bloom when burndown time arrived.

Smith planted clover because it holds moisture better than wheat and also provides nitrogen. “At planting, we figured we were getting 35 to 40 units of nitrogen out of the clover. It's harder to plant into, but we got a perfect stand of corn out of it. The clover corn looks even better than corn planted into wheat.”

Smith's put out Capture in-furrow with a pop-up fertilizer on all his corn. In the clover, made a cutworm application about 30 days after planting. There were 5 to 6 cutworms per foot that needed a pyrethroid.

The jury is still out on the clover as cover, says Smith. “I'll see what the corn yields are, and if the clover doesn't do significantly better than wheat, I'll go back to wheat. It's much easier to plant into.”

Why corn into clover?

“I got this idea from reading. In Georgia, they're doing a lot of work with cover crops. They're using ryegrass and some clover there.

“I wanted something on my fields that would give some nitrogen and hold moisture. So far, so good.”

3: Timelier planting

Because of fall field prep work, Smith is able to plant quickly in the spring.

“This year, I planted 750 acres of corn by myself on one tank of diesel. Other folks were doing prep work on bean ground, and by the time I had the corn planted, the bean ground was ready. I started April 5 and finished April 13. Now that I have beds set up, I'll run on them for three years.”

There's more diesel in the crop than one tank, but spring planting is really easy in his system, says Smith. And he's doing a lot more than just planting with that one trip across the field.

Smith is very particular about not having too much acreage in any one variety of corn. “I'm heavier in Pioneer 31G98, but I have varieties total. Our corn is 40 percent Bt. I also have several plots — 22 Pioneer varieties and nine Terral Norris varieties. The Terral plot has some Gaucho-treated corn.”

4: Soybeans into corn

Smith also planted 160 acres of soybeans straight into 3-foot corn stubble.

“We planted 90 acres of that with a grain drill at about 180,000 seeds per acre. That produced a pretty stand on those beds. I planted the rest in 30-inch rows at about 160,000 seeds per acre. I planted those in rows on top of old rows using trash cleaners and coulters. Right now, I like that best — it's just beautiful.”

Smith likes planting beans into corn. Several weeks ago, Martin Farms got almost 2 inches of rain.

While he was checking fields following the deluge, two fields caught his eye: a freshly bedded soybean field and a field where beans had been planted into corn stubble.

“In the freshly-bedded field there was water standing from end to end. But in the field where I planted into corn stubble, there wasn't any water standing at all. The corn trash just soaks up moisture and holds it for a long time.”

5: Rotation

Low cotton prices, boll weevil eradication costs, and increased insect pressures have farmers looking for alternatives to cotton. As a result, Monroe County — where Holly Grove is situated in eastern Arkansas — has made a big move to corn. And while corn is expensive to raise, it's more economical than cotton, says Smith.

Corn is also a good rotation crop. “Right now, corn is a fitting crop for what we're doing on our land. It's helped us get a handle on morningglories, sicklepod and cockleburs with atrazine in a rotation. It builds organic matter in the soil to the benefit of soybean yields.”

Last year, counting double-crop beans behind wheat, Smith harvested a 50-plus bushel soybean average. He's increased Martin Farms' soybean yield average from 32 bushels four years ago to over 50 bushels now.

Any changes for next year?

“The only change I'm making to wheat planting on beds is in drill placement. I'm going to place the drills on top of the beds and leave the middles empty. This year, my wheat yields have been best when the middles were empty and air and sunlight were able to move down the middles. I also noticed disease pressure was lessened. Wheat will compensate better for no wheat in the middles than it will for puny wheat in the middles.”


e-mail: dbennett@primediabusiness.com.

Limit-up move: Cotton futures break on positive news

Positive news helped cotton prices break through resistance of 45.10-cents (December futures) on June 20. Pessimism about China's cotton crop and anticipated lower U.S. and world carryover were behind the limit-up move to 47.24.

“The market was very defensive on the opening yesterday (June 20),” said Memphis cotton merchant William B. Dunavant, Jr.

“One part of the trade came in and bought a substantial number of contracts. Another part of the trade sold a substantial number of contracts 10-15 points above the previous night's close and the market jumped to 45.10 cents. That's all it took. Then the speculators took over. They bought it and bought it and bought it.”

“I don't think any part of the trade was anticipating a limit move at all,” said Texas A&M Extension economist Carl Anderson. “It caught everybody a little unaware. Then you get all the players on both sides, the users and the speculators covering and hedging their positions.”

Anderson and Dunavant say the move sets a new level of resistance for December at 49 cents and sets up USDA's June 28 acreage report as a factor which could bring even more excitement to the market.

Two reports seemed to trigger the buying. One was a report about rainfall and flooding in China which Anderson said helped fuel ongoing speculation that China would become a significant buyer of U.S. cotton this year. However, actual damage to the crop is still unconfirmed at the time of this writing.

Still another report on cotton supply and demand indicated decreased world cotton production and carryover, and increased consumption.

On the other hand, there are still plenty of cotton supplies in the world keeping pressure on cotton prices.

“I'd be surprised to see the market move above 49 cents in the next three or four weeks,” Dunavant said. “Now if something happens to the crop, yes it can. But the specs are probably getting close to 40 percent long now. So I think the market will settle down somewhat.”

Anderson says if cotton producers, “haven't done any fixing of prices, this (the June 20 move) certainly gives them a new foothold to buy some out of the money puts for price insurance,” Anderson said. “That's a simple way.”

For more sophisticated growers, “If you have a good contract, buy calls and then sell calls about six cents ahead of where they are. So if you contracted at 47 cents, I'd suggest buying a 48 cent call and selling a 54 cent call.”

Marketers now turn their attention to USDA's June 28 acreage estimate. Anderson figures U.S. cotton acreage at 14.5 million to 14.7 million planted acres. “We'd be real surprised to see it at 14.3 million planted acres. That would be very supportive to this market. Then we could very possibly wear that 50-cent resistance down and go on to 52 cents.”

“We're saying cotton acreage is going to be 14.5 million planted acres plus or minus a 100,000 acres,” Dunavant said. “But I think that's already in the market.

Dunavant added that a planted acreage figure of 14.3 million acres, “would really get some people's attention.”


e-mail: erobinson@primediabusiness.com