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Articles from 2016 In September


Heavy rains sprout grain quality concerns in Iowa fields

Heavy rains sprout grain quality concerns in Iowa fields

Last week’s torrential rains that caused devastating flooding in cities and towns in eastern Iowa have also kept many farmers out of the fields due to muddy conditions. Harvest has started in some corn and soybean fields in Iowa. But several days of dry weather are needed to allow statewide harvest to get underway for 2016. The saturated fields have also resulted in mold developing on corn and soybeans in many fields.

SOAKED: A wet harvest means an increase in mold and fungus on crops, plus a slow-down in the field drying process for corn and soybeans. Above-normal rainfall and localized heavy rains have left some fields in Iowa with standing water, raising concerns about crop damage.

The latest Iowa crops and weather survey by USDA for the week ending September 25 shows localized heavy rains, especially in northeast and north-central Iowa, filled a number of fields with standing water. “Activities last week included chopping corn for silage, and some corn and soybean harvesting,” says Greg Thessen, who directs the statewide survey for USDA’s National Ag Statistics Service in Iowa. “However, excessive rains have raised concerns about crop damage and pasture condition in certain parts of the state.”

How many acres of corn and soybeans have been lost?

Iowa officials are trying to assess how many acres of 2016 crops have been impacted by the September flooding. It’s likely to be in the thousands. Many farmers hope to begin combining in the next couple of days. But it could take some growers as long as two weeks before they’re able to harvest soybeans and corn. The shrinking window to harvest what’s expected to be a record large crop is adding to an already stressful year. Many growers are struggling to post a profit and they’re hoping strong yields will help offset lower corn and soybean prices.

Farming near Manchester in northeast Iowa, Kevin Maloney lost about 10 acres of crops along the Maquoketa River. The cattleman also has about 60 acres of pasture under water. The silt and debris will make the pasture unusable for grazing. The receding waters left behind a layer of mud in his cornfield. The ears weren’t submerged but Maloney said he’ll need a few days to decide if the crop can be salvaged.

Submerged corn, soybeans can’t be used for food or feed

Submerged corn or soybeans can’t be used for food or feed, including ethanol plants that sell dried distillers grain to livestock producers, says Mark Licht, an Iowa State University Extension agronomist. And the rain and humidity are resulting in mold on corn and soybeans in fields. Elevators test for mold, among other things, and farmers can lose money if too much grain is damaged. Mold also causes problems when corn and soybeans are stored.

Some farmers are reporting “sprouting”—kernels sprouting when water gathers inside the cobs on the stalks. There are other concerns, too. Cornstalks in saturated fields can break and fall, particularly after a strong wind. Downed or damaged grain is especially concerning this year, Maloney says, even with help from crop federal insurance.

Excessive rains raise concerns about crop damage this fall

The complete weekly Iowa Crop Progress & Condition report is available on the Iowa Department of Agriculture & Land Stewardship’s website IowaAgriculture.gov or on USDA’s site nass.usda.gov/ia.  The report summary follows here:

CROP REPORT: Although southeast Iowa had 6.4 days suitable for fieldwork, statewide there were just 3.6 days suitable for the week ending Sept. 25, 2016, according to USDA’s National Ag Statistics Service. Above-normal rainfall with localized heavy rains led to some fields with standing water. Activities for the week included chopping corn for silage, and some corn and soybean harvesting. Excessive rains have raised concerns about crop damage and pasture condition in certain parts of the state.

Topsoil moisture levels rated 1% very short, 2% short, 67% adequate and 30% surplus. Subsoil moisture levels rated 1% very short, 4% short, 73% adequate and 22% surplus.

As of Sept. 25 in Iowa, 72% of the corn crop was mature or beyond, three days ahead of last year, and two days ahead of the five-year average. Corn harvest slowed due to wet conditions, but there were scattered reports of corn for grain being harvested. Corn condition rated 82% good to excellent.

Soybean harvest has started in areas of Iowa where dry enough

For soybeans, 93% of them were turning color or beyond, three days ahead of last year’s pace. And 68% of soybeans were dropping leaves or beyond, three days ahead of average. Soybean harvest has begun in Iowa in the areas of the state where field conditions were dry enough. Soybean condition is rated 81% good to excellent.

The third cutting of alfalfa hay advanced only one percentage point, to 96%, due to the week’s abundance of rain. Pasture condition rated 65% good to excellent. While above normal temperatures were beneficial for livestock conditions, grazing livestock had to move to higher ground as lowland pastures flooded in north-central and northeast Iowa. Outdoor feedlots also became muddy.

IOWA PRELIMINARY WEATHER SUMMARY—for week ending September 25, 2016

By Harry Hillaker, State Climatologist, Iowa Department of Agriculture & Land Stewardship

It was yet another very wet week across much of Iowa last week. Scattered thunderstorms brought rain from south-central to northeast Iowa on Monday (Sept. 19) and over the extreme northeast corner of the state on Wednesday (Sept. 21) morning. Rain was widespread over the northern one-half of Iowa from Wednesday afternoon to Thursday (Sept. 22) morning with torrential downpours in north-central into northeast Iowa with record flooding along the Shell Rock River.

Downpours in northeast, north-central Iowa have slowed harvest

Thunderstorms were again widespread over the northern two-thirds of Iowa Thursday afternoon into Friday (Sept. 23) morning with heaviest rains centered upon Buchanan and Delaware counties in northeast Iowa. Finally, another episode of widespread rain impacted the western two-thirds of Iowa from Saturday (Sept. 24) afternoon into Sunday (Sept. 25) morning with heaviest rains in southwestern portions of the state. 

Rain totals for the week were exceptionally variable with no rain falling over the southeast portion of Iowa at such locations as Albia, Ottumwa, Fairfield and Burlington while Nora Springs reported 11.07 inches and Nashua 9.76 inches in Floyd County.  

Nora Springs had 11.07 inches of rain, Nashua 9.76 inches last week

The statewide average precipitation was 1.95 inches while normal for the week is 0.77 inches. The statewide average rainfall thus far in September has averaged 6.29 inches, the highest September average since 1986. However, once again, the rain totals this month vary widely from only 0.90 inches at Fairfield to 17.25 inches at Nora Springs. A higher September precipitation total than seen in Nora Springs has occurred in Iowa in only 1926 and 1970. 

Meanwhile it was a very warm and humid week across the state for the seven days ending September 25. Temperatures averaged from 9 degrees above normal across the northeast to as much as 14 degrees above normal in the south with a statewide average of 12.1 degrees above normal. Temperature extremes varied from a Tuesday (Sept. 20) morning low of 47 degrees at Cresco to Wednesday (Sept. 21) afternoon highs of 94 degrees at Atlantic, Algona, Clarion and Indianola.

Help is available for farmers affected by recent flooding

Help is available for farmers affected by recent flooding

USDA officials are reminding farmers, families and small businesses affected by the recent severe storms and flooding in Iowa that the agency has several programs which provide assistance before, during and after disasters. USDA staff in regional, state and county offices are ready to help.

USDA ASSISTANCE: Help is available from USDA agencies and programs for farmers, small businesses and individuals that have been adversely affected by heavy rains and flooding that struck parts of Iowa in recent weeks.

“Our hearts go out to the families and communities in Iowa who have been devastated by flooding over the past several weeks,” said U.S. Agriculture Secretary Tom Vilsack in a September 28 statement sent to the news media. “USDA has offices in nearly every county in the U.S., and we want to remind people we have a variety of services that may be useful in challenging times like this one. Our employees are also members of the communities hit by flooding, and we want to help.”

Contact these agency offices, for your specific situation

USDA encourages farmers and other Iowa residents to contact the following offices to meet their individual needs:  

Crop and livestock loss: The USDA Farm Service Agency (FSA) administers many safety-net programs to help producers recover from eligible losses, including the Livestock Indemnity Program, the Emergency Assistance for Livestock, Honeybees, and Farm-Raised Fish Program, Emergency Forest Restoration Program (EFRP) and the Tree Assistance Program. The FSA Emergency Conservation Program provides funding and technical assistance for farmers and ranchers to rehabilitate farmland damaged by natural disasters.

Producers located in counties that received a primary or contiguous disaster designation are eligible for low-interest emergency loans to help them recover from production and physical losses. Compensation also is available to producers who purchased coverage through the Noninsured Crop Disaster Assistance Program, which protects non-insurable crops against natural disasters that result in lower yields, crop losses or prevented planting. More information on all of these programs can be found at disaster.fsa.usda.gov.

USDA encourages farmers to contact their local FSA office to learn what documents can help the local office expedite assistance, such as farm records, receipts and pictures of damages or losses. FSA maintains contact information online for all Iowa county offices.

Producers should use form FSA-576, Notice of Loss, to report prevented planting and failed acres in order to establish or retain FSA program eligibility. Prevented planting acreage must be reported no later than 15 calendar days after the final planting date as established by FSA and USDA Risk Management Agency (RMA). Producers must file a Notice of Loss for failed acres on all crops including grasses in a timely fashion, often within 15 days of the occurrence or when the losses become apparent. Producers of hand-harvested crops must notify FSA of damage or loss within 72 hours of when the date of damage or loss first becomes apparent.

Producers with coverage through the RMA administered federal crop insurance program should contact their crop insurance agent. Those who purchased crop insurance will be paid for covered losses. Producers should report crop damage within 72 hours of damage discovery and follow up in writing within 15 days.

Community recovery resources: For declared natural disasters that lead to imminent threats to life and property, the USDA Natural Resources Conservation Service (NRCS) can assist local government sponsors with the cost of implementing recovery efforts like debris removal and streambank stabilization to address natural resource concerns and hazards through the Emergency Watershed Protection Program. NRCS staff is coordinating with state partners to complete damage assessments in preparation for sponsor assistance requests. NRCS also can help producers with damaged agricultural lands caused by natural disasters such as floods.

The NRCS Environmental Quality Incentives Program (EQIP) provides financial assistance to repair and prevent excessive soil erosion that can result from high rainfall events and flooding. Conservation practices supported through EQIP protect the land and aid in recovery, can build the natural resource base, and might help mitigate loss in future events.

Property and shelter damage: When floods destroy or severely damage residential property, USDA Rural Development can assist with providing priority hardship application processing for single family housing. Under a disaster designation, USDA Rural Development can issue a priority letter for next available multifamily housing units. While these programs do not normally have disaster assistance authority, many of USDA Rural Development programs can also help provide financial relief to small businesses hit by natural disasters, including low-interest loans to community facilities, water environmental programs, businesses and cooperatives and to rural utilities. More information can be found on the Rural Development website at rd.usda.gov  or by contacting the State Office located at 210 Walnut, Des Moines, IA 50309, or by calling 515-284-4663.

USDA National Institute of Food and Agriculture provides support for disaster education through the Extension Disaster Education Network (EDEN). EDEN is a collaborative multistate effort with land-grant universities and Cooperative Extension Services across the country, using research-based education and resources to improve the delivery of services to citizens affected by disasters.

For more on these and other programs: For complete details and eligibility requirements regarding USDA’s disaster assistance programs, contact a local USDA Service Center. More information about USDA disaster assistance as well as other disaster resources is available on the USDA Disaster Resource Center website. In a continuing effort to better serve the public, USDA has developed a new and improved central resource for disaster related materials.

In partnership with the Federal Emergency Management Agency and other disaster-focused organizations, USDA created a Disaster Resource Center website at usda.gov  using a new online searchable knowledgebase. This knowledgebase is a collection of disaster-related resources powered by agents with subject-matter expertise. The new Disaster Resource Center website and Web tool now provide an easy access point to find USDA disaster information and assistance.

Caution: cash flow problems ahead

Caution: cash flow problems ahead

Ag lenders have reported large net equity losses for some row crop farms the past couple years. You can expect this trend to continue as lenders update farmers’ balance sheets in the future, a few months from now. Many farms will have excess bushels of unpriced grain and may face running out of cash or time for cash prices to rise in order to pay down existing obligations.

Record 2016 Iowa and U.S. corn and soybean production and yields are forecast. Those extra bushels should benefit a farm’s total crop revenue. However, a farmer who didn’t do a good job of managing futures price risk this past spring could run into cash flow problems ahead.

RECORD PRODUCTION HELPS: Good yields this fall will help boost a farm’s total crop revenue. However, a farmer who didn’t do a good job of managing futures price risk this past spring could run into cash flow concerns in the months and year ahead.

Preharvest marketing. Farmers who did a good job of forward contracting new crop bushels, hedging or buying put options this spring will avoid many cash flow concerns.   However, those farms holding large quantities of unpriced crops could see cash flow challenges and may want to focus on their marketing strategies now. Perhaps they should make some local cash sales at harvest or deliver to a processor where better cash prices reflecting basis exists.

Work with your lender. If you know cash flow is already going to be a problem, communicate early with your lender ahead of time. Many lenders spent the past couple of winters restructuring existing farm debt to stretch out principal payments and free up depleted working capital. These same lenders could be reluctant to restructure loans any time soon without commitment of the farmer to improve their cash flow management.

These cash flow problems will likely appear in October with interest or penalties incurred for late property tax payments and crop insurance premiums. Farms without access to typical farm operating loans should avoid advancing family living and farm expenses on credit cards or higher interest-bearing debt.

USDA’s Farm Service Agency (FSA) does offer a low-interest, nine-month non-recourse marketing loan on harvested grain; but FSA requires that the on-farm stored bushels be measured or the commercially stored grain is under warehouse receipt. This marketing loan is limited at the county loan rates, which are below the national loan rates of $1.95 per bushel for corn and $5.00 per bushel for soybeans.

Avoid long-term commercial storage. Waiting until after harvest for corn and soybean futures prices to rebound along with basis improvement may take several months. You can expect on-farm storage space will be tight this fall as harvest wraps up and basis remains abnormally wide. However, storing on-farm likely means lower costs for drying, shrink and overall storage costs. Perhaps the greatest benefit of storing on-farm besides harvest efficiency is that it allows the farmer more time and improved chances to shop around for better cash prices reflected in basis.

Commercial storage space should be available at harvest, but basis will be limited as huge piles of corn on the ground appear at many elevators and cooperatives. Limitations of commercial storage costs and accruing interest on existing debt along with any short-term basis improvement negates many benefits for a positive net return to grain ownership until perhaps spring of 2017.

With more farms facing cash flow constraints this fall, they should consider the delivery of bushels at harvest. By communicating with the grain merchandiser in advance, you can still “stay long in the deferred futures” using a basis contract and/or a minimum price contract. Much of the actual cash price of the grain will be received upon delivery. Thus, you generate needed cash flow and eliminate storage costs, basis risk and accrued interest. You still have futures price risk in those deferred contract months, so you’ll need to work with your grain merchandiser to “short futures” before that futures contract goes into delivery. 

Conclusion. Cash flow is an underlying concern for many Iowa farms this fall. Unless a farm is self-financed, has access to credit or did a good job of preharvest marketing new crop bushels, you can expect cash flow challenges to emerge this fall and early winter. 

The ISU Extension Ag Decision Maker website has a variety of resources for farm financial planning and stress management. Assistance can be provided in assessing a farm's financial situation including one-on-one financial analysis and advice to help farmers with grain drying and shrink strategies. One-on-one financial counseling, a computerized analysis of the farm business, and referral to other Extension programs or outside services are also available.

* For more information, visit Changing Farm Financial Conditions at

extension.iastate.edu/agdm/info/currentissues.html. This website has resources for financial planning and stress management from Iowa State University Extension and Outreach. These resources are available to assist in assessing a farm's financial situation.

Johnson is the Iowa State University Extension farm management specialist for central Iowa. Contact him at sdjohns.iastate.edu.

Over a Cup - October 1, 2016 : farm bills, political contributions, and Prairie Farmer

Over a Cup


Consider pros, cons of alternative grain storage methods

large pile of deteriorating corn

Grain frequently is stored short term in outdoor piles. However, precipitation is a severe problem in uncovered grain.

A 1-inch rain will increase the moisture content of a 1-foot layer of corn by 9 percentage points. This typically leads to the loss of at least 2 feet of grain on the pile surface.

A 1-foot loss on the surface of a 25-foot-high, cone-shaped pile is about 13% of the grain. This is a loss of $39,000 if the grain value is $4 per bushel.

If creating outdoor piles:

  •  Use a cover to prevent water infiltration. Aeration and wind blowing on the pile will not dry wet grain adequately to prevent spoilage.
  •  Prepare the ground surface where grain will be piled with lime, fly ash or cement to prevent soil moisture from reaching the grain.
  •  Place the pile so the storage floor is higher than the surrounding ground to minimize moisture transfer from the soil into the grain.
  • Make sure the ground surface is crowned so moisture that does get into the pile drains out rather than creating a wet pocket that leads to grain deterioration.
  • Examine the entire area to assure that flooding will not occur during major rain events.

Grain covers

A combination of restraining straps and suction from the aeration system holds grain covers in place. Place perforated ducts on the grain under the cover to provide a controlled air intake for the aeration system and airflow near the cover to minimize condensation problems.

Properly sized and spaced ducts also should be placed on the ground under the pile to pull air through the grain. If you use a perforated grain wall, the aeration ducts near the wall should not be perforated or the airflow through the grain will be limited to near the wall.

Cooling stored grain

Cool grain with aeration to reduce the insect infestation potential. Insect reproduction is reduced at temperatures below about 60 F, insects are dormant below about 50°F, and insects can be killed by extended exposure to temperatures below about 30°F.

Cooling grain as outdoor temperatures cool reduces moisture migration and the condensation potential near the top of the grain pile. In addition, grain moisture content and temperature affect the rate of mold growth and grain deterioration, with the allowable storage time approximately doubling with each 10-degree reduction in grain temperature.

The grain should be cooled whenever the average outdoor temperature is 10 to 15 degrees cooler than the grain. It should be cooled to near or below 30°F for winter storage in the northern states and near or below 40°F in states with warmer winter temperatures.

Aeration ducts need to have perforations sized and spaced correctly for air to enter and exit the ducts uniformly and obtain the desired airflow through the grain. The maximum spacing for aeration ducts is equal to the grain depth to achieve acceptable airflow uniformity.

Originally posted by North Dakota State University. 

ADM purchases Caterina Foods assets

ADM purchases Caterina Foods assets

Archer Daniels Midland Company today announced that it has purchased the assets of Caterina Foods, a leading toll manufacturer of specialty gluten-free and high-protein pastas.

Archer Daniels Midland Company has purchased the assets of Caterina Foods, a leading manufacturer of specialty gluten-free and high-protein pastas. (Photo: minoandriani/Thinkstock)

“ADM is continuing to deliver on our strategy to create shareholder value by expanding our capabilities downstream in the value chain,” said Vince Macciocchi, president of ADM’s WILD Flavors and Specialty Ingredients business. “Caterina is a toll processor for our majority-owned Harvest Innovations, and will be a key part of our growth plans for that important business. The addition of the Caterina business gives us yet another way in which to meet the needs of health-conscious consumers—in this case expanding our ability to produce specialty pastas from legumes and grains other than wheat.”

Caterina produces gluten-free and high-protein pastas in a variety of shapes and sizes from flours made from corn, lentils, peas, rice, quinoa and many other grains and legumes.

“Since we purchased a controlling stake in Harvest Innovations, we have continued to see increased demand for gluten-free and other non-wheat pastas,” Macciocchi continued. “Together, Harvest and Caterina will allow us to streamline our operations while expanding our capabilities in this growth area. We are looking forward to finding new ways to expand and advance the Harvest and Caterina businesses, and working with customers across the country to meet their ingredient needs for health-conscious consumers.”

Caterina Foods, based in Lake Bluff, Illinois, has about 60 employees.

ADM purchases Caterina Foods assets

ADM purchases Caterina Foods assets

Archer Daniels Midland Company today announced that it has purchased the assets of Caterina Foods, a leading toll manufacturer of specialty gluten-free and high-protein pastas.

“ADM is continuing to deliver on our strategy to create shareholder value by expanding our capabilities downstream in the value chain,” said Vince Macciocchi, president of ADM’s WILD Flavors and Specialty Ingredients business. “Caterina is a toll processor for our majority-owned Harvest Innovations, and will be a key part of our growth plans for that important business. The addition of the Caterina business gives us yet another way in which to meet the needs of health-conscious consumers—in this case expanding our ability to produce specialty pastas from legumes and grains other than wheat.”

Caterina produces gluten-free and high-protein pastas in a variety of shapes and sizes from flours made from corn, lentils, peas, rice, quinoa and many other grains and legumes.

“Since we purchased a controlling stake in Harvest Innovations, we have continued to see increased demand for gluten-free and other non-wheat pastas,” Macciocchi continued. “Together, Harvest and Caterina will allow us to streamline our operations while expanding our capabilities in this growth area. We are looking forward to finding new ways to expand and advance the Harvest and Caterina businesses, and working with customers across the country to meet their ingredient needs for health-conscious consumers.”

Caterina Foods, based in Lake Bluff, Illinois, has about 60 employees.

FSIS issues guidance on grass fed label

Beef cattle in pasture

For nearly a decade USDA’s Agricultural Marketing Service had overseen a voluntary label program for grassfed livestock products that was well recognized by farmers and consumers alike.

Related: USDA withdraws grass-fed marketing standard

Earlier this year, however, AMS withdrew the standard, claiming that USDA's Food Safety Inspection Service (FSIS) was actually the agency with the legal standing to oversee the label claim. Following AMS’ revocation of the standard, the National Sustainable Agriculture Coalition, together with allied agricultural and consumer organizations, urged FSIS to adopt the rescinded AMS standard – a well-respected label claim that had been developed over three years with robust stakeholder participation.

On Sept. 30, the Food Safety and Inspection Service released labeling guidance.  The guidance says grass fed claims require a signed and dated document describing how the animals are raised.

“We are pleased that FSIS has clarified through this guidance that any label claim using the term ‘grassfed’ must meet a 100% grassfed standard,” said Ferd Hoefner, policy director for the National Sustainable Agriculture Coalition. “Taking this action was necessary to preserve the label’s strong reputation, and we applaud FSIS’ swift response to producer and consumer concerns following AMS’ withdrawal of the standard earlier this year.”

Hoefner said they appreciate that FSIS added access to pasture as a requirement, but the NSAC also has concerns with the guidance.

“Even with this new guidance, FSIS can still approve lesser label claims, such as “75% grassfed” or “80% grassfed”. These claims are misleading for consumers and harmful to the farmers and ranchers who have built their reputations, and indeed an entire industry, on the 100% grassfed standard,” Hoefner said.

“USDA needs the legal authority to not only enforce strong, pro-farmer, pro-consumer standards, but also to reject misleading claims. We will continue to support FSIS in upholding a strong 100% grassfed label claim standard, while also advocating for an improved process that does not leave the door open for misleading, lesser claims.”

Source: National Sustainable Agriculture Coalition

As China halts DDG imports, can the bean market find traction?

Soybeans

Soybean bulls continue to point towards strong demand from the Chinese.

In fact, there's been a lot more talk inside the trade about Chinese meal demand increasing exponentially as their government shuts down a large portion of the DDGs being imported.

The bears however are pointing to very real possibility that the USDA could raise last years U.S. production number in todays report and the fact Sept. 1 stocks could be a bit more burdensome than some are anticipating. The bears also continue to point towards the possibility of the USDA raising both their yield and acreage estimates for the U.S. crop in the upcoming Oct. 12 monthly "Supply and Demand" report.

Keep in mind, that report is just seven short trading days away. It's just tough to extend a major rally when the trade continues to talk about ending stocks potential pushing north of 400 million bushels.

As a producer, I continue to keep my hedges in place. As a spec, I continue to like the thought of being a longer-term buyer but still see no need to get in any hurry. There's still a ton of market focus being placed on the U.S. crop and it appears to be getting only larger.

In addition the early South American weather is mostly cooperative. In other words, there's really nothing out there in the headlines to spook the bears. Keep you eye on todays USDA data, I imagine it could create some loud noise within the soybean market.  

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