program abuse, Stabenowargued program savings couldbe derived from closing aloophole in low-income heat-ing assistance, and rejected anystructural changes to the Sup-plemental Nutrition AssistanceProgram (SNAP or foodstamps).

House Ag CommitteeRanking Democrat CollinPeterson (D-Minn.) warnedany House Republican demandfor deep cuts in SNAP fundingcould stall farm bill passage.

House Ag Chairman FrankLucas (R-Okla.) raised doubtsthat a farm bill could clear theHouse by Memorial Day, citingCongress’ “legislative environ-ment.” “We haven’t even done ahighway bill yet,” he noted.

House Ag Committeemember Rep. Bobby Schilling,a Colona Republican, will par-ticipate in a March 23 fieldhearing at Carl Sandburg Col-lege in Galesburg.

Illinois farmers will beoffered an opportunity tovoice priorities for the nextfarm bill during the 9 a.m.hearing at the college’s StudentCenter Building B, 2400 TomL. Wilson Boulevard.

The first of the Househearings was conducted lastFriday in Saranac Lake, NewYork, a March 30 hearing isplanned at Arkansas State Uni-

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Monday, March 12, 2012 Two sections Volume 40, No. 11

FarmWeek on the web: FarmWeekNow.com Illinois Farm Bureau®on the web: www.ilfb.org

FedeRaL tax bReakS forcorn-based ethanol are gone, so thebiofuels sector is working to bringcellulosic ethanol on board. ............5

a CoMMunity CoLLeGeprofessor says education is neededfor rural residents before broadbandadoption will be widespread. ...........3

Lt. Gov. SheiLa SiMondoes not expect her committee torecommend forced school consol-idations. .........................................3

Galesburg field hearing March 23

Lawmakers leaning toward $23 billion ag cut target BY MARTIN ROSSFarmWeek

As farm state lawmakerscontinue to mull ag prioritiesand crunch the budget num-bers, the 2012 farm bill budgetmay be coming into focus, butthe timetable for the bill’s finalpassage appears uncertain.

Senate Ag Committee Chair-man Deb Stabenow (D-Mich.)suggested she and her col-leagues would develop a farmbill based on the $23 billion in10-year ag spending cuts putbefore the congressional deficit“super committee” last fall.

House ag leaders last weekasked the House Budget Com-mittee to consider keeping cutsat that level, noting “the agri-culture economy is highlycyclical.”

“I’d also say that there’s anawful lot of uncertainty as towhat the House may come upwith — what it will have toface,” American Farm BureauFederation (AFBF) chief econ-omist Bob Young toldFarmWeek.

The super committee plananticipated eliminating directpayments, cutting conservationspending by $6 billion, andfood stamps and other nutri-tion programs by $4 billion.

As a House governmentoversight panel eyed nutrition

Food security for infants, children, and theneedy is “close to my heart,” U.S. Sen. DickDurbin told Illinois Farm Bureau board mem-bers recently.

For that reason, the Springfield Democratsaid he has “no sympathy” for those who abuseprograms such as SNAP (the SupplementalNutrition Assistance Program), i.e, food stamps.

Durbin told IFB leaders he was working withSenate Ag Committee Chairman Deb Stabenow(D-Mich.) to “tighten up the SNAP program.”Last week, the U.S. House Oversight and Gov-ernment Reform Committee examined reportedfraud within the program.

SNAP and other food assistance programsfall under the farm bill nutrition title, accountingfor roughly two-thirds of the federal govern-ment’s annual ag spending.

Eliminating program waste and abuse is acause both for bipartisan lawmakers and FarmBureau, which has advocated program adminis-trative improvements that could trim as much as$4 billion in long-term ag budget costs.

“There ought to be a way of making thingsmore efficient without cutting (nutrition) pro-grams,” IFB President Philip Nelson stressed.

USDA Undersecretary Kevin Concannon

noted that from Oct. 1 to Dec. 31, more than225 stores that violated SNAP rules were finedor temporarily banned from the program. Morethan 350 stores caught trafficking in food stampbenefits may no longer participate, Concannontold House lawmakers.

“We have a goal every year of tightening thatdown,” USDA Chief of Staff Krista Hardentold IFB directors.

Meanwhile, Durbin applauded USDA forincluding Illinois and Chicago’s public schoolsin a new demonstration project aimed at reduc-ing fraud and increasing eligible low-incomeenrollment in the National School Lunch Pro-gram.

Illinois will be able to enroll students for freemeals automatically based on Medicaid partici-pation, reportedly preventing eligibility errors,reducing application paperwork, and creatingnew administrative efficiencies.

In January, the Chicago Tribune revealed casesin which school employees submitting falseinformation in order to enroll more children forfree or reduced-cost lunches.

“Recent reports of abuse and fraud withinthe system threaten to damage the integrity ofthe program,” Durbin said. — Martin Ross

Feds eye fat in farm bill nutrition programs

Capitol a flurry as committees meet bill deadlineHouse OKsSMV bill BY KAY SHIPMANFarmWeek

State legislative action wasin overdrive last week as law-makers hustled to shepherdbills and meet Friday’s deadlinefor committee passage in thechamber where the bills origi-nated.

Adding excitement wasattention to the March 20 pri-mary election, and Illinois’higher profile given the incon-

clusive results from the SuperTuesday presidential primaries.

Illinois Farm Bureau sawearly success with HB 4598on improper usage of slow-moving-vehicle emblems.Rep. Pat Verschoore (D-Milan) sponsored thebill that wouldincrease the cur-rent penalty from$25 to $75 forimproperusage andexpand thedefinition ofillegal use

beyond a road right-of-way.The House passed HB 4598

with a 106-10 vote. Sen. DaveKoehler (D-Peoria) will spon-sor the bill in the Senate.

Another IFB-sup-ported bill remained in

the Senate Agricultureand Conservation

Committee. SB3271, sponsored

by Sen. MichaelFrerichs (D-Champaign),seeks to estab-lish statewidestandards for

commercial wind energyprojects.

In committee, SB 3271faced stiff opposition fromwind energy companies, con-cerned landowners, and countyand local government associa-tions, said Paul Cope, IFBassistant director of state legis-lation.

“IFB is working to ensurethat our landowner membersare protected by some stan-dards,” Cope said. “We’re try-ing to find common ground tosatisfy all parties involved

See Capitol, page 3

versity, and committee mem-bers will convene on April 20in Dodge City, Kan. At leasttwo Capitol Hill hearings likelywill follow.

AFBF President Bob Stall-man is set to testify Wednesdayat a Senate Ag hearing on thefarm bill.

The hearing, which wrapsup committee review of farmbill issues, will evaluate theneed for and economics ofsafety net resources for farm-ers who “continue to faceincreasingly volatile cropprices, input costs, and thethreat of natural disasters,”

according to AFBF.Last week, the Senate com-

mittee held a hearing focusingon “healthy food” initiatives,local production, and nutrition,exploring opportunities to helpdevelop local markets thatenable farmers to tap growingconsumer demands.

FIRST FIELD HEARING — New York Farm Bureaumembers testified about the importance of providing astrong crop insurance program, addressing ongoing chal-lenges with immigration, and adopting a “21st centuryapproach” to dairy issues in the 2012 farm bill at last week’sSenate Ag Committee field hearing in Saranac Lake, N.Y.

“The devastating weather events of 2011 have only servedto highlight the need for some major changes in our cropinsurance program,” grower Larry Eckhardt said. “Congressshould instruct the USDA to research and develop, withinput from actual growers of specialty crops, risk manage-ment tools that will work more effectively for diverse cropfarms.”

Panelists highlighted the need to offer a buy up option inthe Non-Insured Disaster Assistance Program (NAP) so thatspecialty farmers can better manage risk and the importanceof maintaining adequate dairy prices and margin protections.

A farm bill hearing is scheduled in Illinois on March 23.QUINN SEEKS FEDERAL DISASTER HELP —

Gov. Pat Quinn last week asked President Barack Obama todeclare Gallatin, Randolph, Saline, Union, and Williamsoncounties federal disaster areas because of devastation fromFeb. 29 tornadoes and severe storms.

Damage assessment teams from the Illinois EmergencyManagement Agency (IEMA), the Federal Emergency Man-agement Agency (FEMA), the U.S. Small Business Adminis-tration (SBA) and affected communities documented damageto homes and businesses. A total of 104 homes weredestroyed by severe storms and tornadoes; 50 suffered majordamage, and 276 others were seriously damaged. Seven peo-ple were killed.

Ten businesses in Saline County sustained major damage,while 23 others were affected by the storms.

If Quinn’s request is approved, residents in the approvedcounties would be eligible to apply for grants and low-inter-est SBA loans. Affected businesses also would be able toapply for low-interest SBA loans.

IEMA and FEMA representatives and local governmentofficials are to start meeting today (Monday) to documentexpenses related to the tornadoes and storms.

PENNYCRESS FOR YOUR THOUGHTS — Tooearly in the season for a good farm field day? Not accordingto Brad Glenn.

The group Pennycress Partners will host three field daysnext week designed to offer farmers and others a chance toview pennycress, a new oilseed crop with biofuels potential.

Since it is an overwintering crop, it can be a complementto corn and soybean production and provide winter groundcover. Moderate winter weather has contributed to healthydevelopment: “It kind of looks like a field of dandelionsright now,” said Glenn, who’s helped coordinate pennycressproduction.

The first field day is from 9 to 11 a.m. March 20 at theBruce Klein farm two miles north of Lexington in McLeanCounty at 23479 E. 2700 North Road. A second is March 21,also from 9 to 11, at Brian Corkill’s farm south of Kewaneein Henry County on Illinois Route 78, then west a half-mileon 1100 North Road. The final field day is from 9 to 11March 22 at Ken Folkerts farm between Raymond andNokomis in Montgomery County on 2100 North Road, eastof 1300 East.

FarmWeek Page 2 Monday, March 12, 2012

(ISSN0197-6680)

Vol. 40 No. 11 March 12, 2012

Dedicated to improving the profitability of farm-ing, and a higher quality of life for Illinois farmers.FarmWeek is produced by the Illinois FarmBureau.

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STAFFEditorDave McClelland (dmcclelland@ilfb.org)Legislative Affairs EditorKay Shipman (kayship@ilfb.org)Agricultural Affairs EditorMartin Ross (mross@ilfb.org)Senior Commodities EditorDaniel Grant (dgrant@ilfb.org)Editorial AssistantLinda Goltz (Lgoltz@ilfb.org)Business Production ManagerBob Standard (bstandard@ilfb.org)

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Quick TakesEmErging issuEs

BY DANIEL GRANTFarmWeek

It may be safe to say winter is over in Illinois,even though spring doesn’t officially begin untilMarch 20.

The forecast on Friday called for tempera-tures in Central Illinois this week to reach the70s, which would be well above normal, accord-ing to Emily Timte, meteorologist with theNational Weather Service in Lincoln.

“It looks like we’ll start warming up,” Timtetold FarmWeek. “Temperatures could be wellabove normal.”

The temperature the first week of thismonth averaged between 1.5 and 5 degreesabove normal around the state, according to theIllinois State Water Survey (ISWS).

And it appears that trend will continue.“The monthly outlook is calling for this

month to be above normal (in terms of temper-ature and precipitation),” Timte said.

“The polar jet stream has been stuck upnorth. That’s why the colder air wasn’t able tofilter into our area and we didn’t have muchsnow,” she continued. “It looks like we’re kindof keeping that same pattern (into spring).”

The average temperature statewide for theclimatological winter (December through Feb-ruary) was 34.2 degrees, 5.2 degrees above nor-mal.

“That was the third-warmest winter onrecord,” said Jim Angel, ISWS state climatolo-gist.

The warmest winter on record in the state,with an average temperature of 37.1 degrees,occurred in 1931-32 while the second-warmestwinter temperature (34.5 degrees) occurred in1997-98 and 2001-02.

Precipitation this winter averaged 6.73 inch-es, two-tenths of an inch below normal. Mostof it was rain, though, as snowfall totals werejust 50 to 75 percent of normal in NorthernIllinois and 25 to 50 percent of normal in thecentral and southern regions of the state.

The spring-like temperatures in recent weeksgave many farmers, particularly those in South-ern Illinois, a chance to get an early start onpre-planting fieldwork.

“It looks like we may be leaning toward anearly spring,” said Randy Martinson, marketanalyst with Progressive Ag. “It may result inmore corn.”

Winter third-warmest in Illinois; the mild trend could continue

Can farmland values maintain torrid pace?Farmland values are expect-

ed to remain strong this yearbased in part on a positive out-look for farm income.

But the growth rate couldslow, particularly if crop pricesmoderate this year as USDA isprojecting.

“We see this as a marketfueled by income expecta-tions,” Michael Morris, chiefappraiser for 1st Farm CreditServices in Bloomington, saidlast week at the WILL AM 580ag outlook meeting in Coving-ton, Ind.

“It could soften, but wedon’t see any reason why itwould completely go away.”

The Ag Department lastmonth projected average cropprices this year could declineby 20 percent for corn, 1.7 per-cent for beans, and 13 percentfor wheat compared to arecord year for farm income in2011.

Net income still was project-ed to total $96.3 billion thisyear, which would be the sec-ond-highest on record.

“Even with a little softeningwe see stable to strong (com-modity) prices,” Morris said. “Alot hinges on this year’s crop.”

Morris noted in some casesfarmland values increased byabout 50 percent the past twoyears.

He predicted farmland val-ues from July 2011 to July 2012could increase another 15 to 25percent, although most of thatincrease took place last year.

“So far this year the marketseems to be taking a breath,”Morris said.

Prices in Central Illinois cur-rently are averaging between

$11,000 and $12,000 per acrefor Class A ground, $7,000 to$9,000 for Class B ground, and$6,000 to $8,000 for Class Cground.

The high prices helpeddrive up the supply of farm-land on the market, comparedto recent years, according tothe appraiser.

“There has been a lot ofsales activity in some areas,”Morris said. “Supply has comeup with demand. Demand isbeing fueled by great cropreturns.”

The market is down inmany areas, however, for landintended for development andrecreational land.

Morris said that trend isdue to the poor U.S. housingmarket and economic strug-gles.

“There are instances inwhich people sold land (thatwas slated for development)for $40,000 to $50,000 (peracre) and they bought it backfor $10,000 to $12,000 and arefarming it again,” he said.

A full report on Illinoisfarmland values and leasetrends will be released nextweek at the Illinois Society ofProfessional Farm Managersand Rural Appraisers’ Illinoisland values conference Thurs-day in Bloomington. —Daniel Grant

March 12On-the-Road seminar, 7 p.m. Grundy County Farm Bureaubuilding, Morris.

March 13On-the-Road seminar, 7 p.m. Ford-Iroquois County FarmBureau, Gilman.

March 14On-the-Road seminar, 1:30 p.m. DeWitt County Extensionbuilding, Clinton, 217-935-2126.

March 16On-the-Road seminar, 1:30 p.m. Kendall County Farm Bureaubuilding, Yorkville.

March 20Illinois primary election

March 22 On-the-Road seminar, 6 p.m., Cass-Morgan Farm Bureau,Jacksonville.

March 28Agriculture Legislative Day, State Capitol, Springfield.

March 29On-the-Road seminar, 9:30 a.m., University of IllinoisExtension office, Hardin.

On-the-Road seminar, 6 p.m., Livingston County FarmBureau, Pontiac.

DATEBOOK

Around IllInoIs

Page 3 Monday, March 12, 2012 FarmWeek

Continued from page 1while protecting our landowner members.”

The proposed standards would provide protection for privateproperty rights and allow for reasonable development of com-mercial wind energy projects. Farm Bureau delegates debatedand approved similar policy at the IFB annual meeting inDecember, Cope noted.

SB 3271 incorporated existing state law that allows countiesand municipalities to allow meteorological towers to be sitedwithout formal approval.

The proposed bill still would allow counties to permit, site,and approve wind projects.

A proposal that would ban farmers from docking the tails ofcattle passed in the House Business and Occupational LicenseCommittee. IFB opposes HB 1697.

The bill would prevent farmers from using a practice thathelps them minimize infection and improve cow cleanliness. Itwould allow tail docking to be done only by a veterinarian ifmedically necessary, under hygienic conditions, and only if theanimal is anesthetized.

The proposal would require the procedure to be done in away that would minimize any long-term pain and suffering ofthe animal.

Simon sees no forced school consolidationsBY DAVE MCCLELLANDFarmWeek

Education, local foods, andrural emergency medical serv-

ices (EMS)are the princi-pal issues Lt.Gov. SheilaSimon isworking onthese days,she told thoseattending the23rd annualRural Devel-

opment Conference in Peorialast week.

The conference was pre-

sented by the Illinois Institutefor Rural Affairs at WesternIllinois University in conjunc-tion with the Governor’sRural Affairs Council, whichSimon chairs.

She acknowledged thatGov. Pat Quinn’s commentsabout the vast savings thestate could realize by reducingthe number of school districtsfrom nearly 900 to 300 “madethe hair stand up” on a num-ber of people’s necks.

Coming from a rural areaherself, Simon said, “Weknow what schools mean tothe community, to the com-

munity’s identity.”She said she wanted to get

involved to “reshape the dis-cussion” and thus heads theClassrooms First Commis-sion, a 20-member groupcharged with recommendingways Illinois school districtscan improve student learningand reduce district costs.

Draft recommendationsfrom the commission areexpected to be completed bynext month and will be sub-mitted to four public hearingsto gauge the public’sresponse.

Simon, however, gave a

clue as to what she expects tocome from her group: no rec-ommendation for forced con-solidation.

“Sometimes consolidationworks and sometimes it does-n’t work,” the lieutenant gov-ernor said.

Those schools that do notwant to consolidate still mightfind ways to save money bybuying food items in bulk ormaking a specialized classavailable to students fromboth districts.

On the local food issue,Simon said her office contin-ues to work with farmers’

markets to make the IllinoisLink card more readilyaccepted. The link card isused to provide governmentassistance.

She said it is imperativethat more of Illinoisan’s fooddollars be spent in Illinois,that of the $48 million Illinoisresidents spend on food eachyear, $46 million is spent onfood that comes from outsidethe state.

Simon said she is workingwith the General Assembly onlegislation to help make EMSavailable throughout rural Illi-nois.

Sheila Simon

A legislative proposal to cre-ate underground carbon diox-ide (CO2) storage regulation isof great concern to IllinoisFarm Bureau, which opposesthe bill.

SB 3758, sponsored by Sen.James Clayborne (D-Belleville),would create the Carbon Diox-ide Geologic Storage Act,establishing regulations andprocedures for undergroundstorage of CO2.

The bill was to be called fora vote in the Senate EnergyCommittee last week, but Clay-borne agreed to hold it foradditional input, according toBill Bodine, IFB associatedirector of state legislation.

As it is currentlywritten, SB 3758automatically wouldcompel alllandowners to goalong with aCO2 storageproject if only 51percent of the

landowners in the storage areasign up to participate, saidKevin Semlow, IFB director ofstate legislation.

That action raises signifi-cant concerns about privateproperty rights for landown-ers. The bill would allow thetaking of CO2 storage spacewithout providing landownerstheir due process rights, saidSemlow.

Bodine noted companieshave expressed interest indeveloping these storage facili-ties in several counties in thestate.

At the present time, this pro-posal does not impact theArcher Daniels Midland Co.

CO2 storage pilot projector the FutureGen proj-

ect. Last November,ADM began injectingthe gas in Decatur’sMt. Simon Sand-stone more than amile underground.— Kay Shipman

Capitol

Carbon dioxide billraises IFB concerns

Gov. Pat Quinn last weekannounced an agreementbetween Rock Island CleanLine LLC and Southwire Co.,based in Flora, for a projectto enhance transmission ofrenewable energy.

Under the agreement,Southwire will supply theoverhead transmission cablefor the Rock Island CleanLine project.

The project will consist ofabout 500 miles of overhead,high voltage direct currenttransmission lines that willdeliver 3,500 megawatts of

renewable power from Iowa,Minnesota, Nebraska, andSouth Dakota to Illinoistowns and businesses and toother states to the east. Con-struction could begin as earlyas 2014 and continue overthe next few years.

The Rock Island CleanLine will enable about $7 bil-lion worth of new wind ener-gy projects that had stalleddue to lack of transmissioncapacity to move forward.

An Illinois State Universi-ty study found that windenergy in Illinois generates

$22.2 million in annual prop-erty taxes and supports near-ly 600 permanent jobs andmore than 13,000 construc-tion jobs.

Illinois led the nation inturbine installation last yearwith 404 turbines.

The Chicago-area is hometo the U.S. or global head-quarters of 14 wind develop-ers or manufacturers.

Illinois also is home tohundreds of companies thatprovide services to the windenergy industry or manufac-ture wind components.

FB input soughtfor curriculum BY KAY SHIPMANFarmWeek

Rural Illinois faces more than infrastruc-ture needs to get its residents online with

high-speed Internet, a LakeLand Community Collegeprofessor told county FarmBureau leaders recently.

“We could spend a gazil-lion dollars (on infrastruc-ture), but I don’t think it willmake a difference until weaddress needs,” said MikeRudibaugh, also the mappingdirector with Partnership fora Connected Illinois.

Rudibaugh discussed rural broadband at therecent Illinois Farm Bureau GovernmentalAffairs Leadership Conference in Springfield.

“If we’re trying to address the digitaldivide, education is a barrier (to broadbandadoption) in all regions of the state,” he said.“Some people in rural Illinois are still tryingto define what broadband is.”

Rudibaugh, a self-proclaimed “small-townguy,” proposed a model curriculum andbroadband training program be developedfor rural residents. Such a program could be

offered in community colleges’ computerlabs and promoted through Farm Bureau andUniversity of Illinois Extension, he suggest-ed.

Rudibaugh added the curriculum and pro-gram also would need to be evaluated todetermine if they were working before theywould be replicated around the state withspecial attention to regional needs.

He used a national trends study to makehis case. Research has shown that age,income, and education influence if and howan individual uses computers and the Inter-net.

On average, broadband usage is down inareas where more than 13 percent of thepopulation is 65 or older, where more than15 percent of adults did not graduate fromhigh school, and where the average annualfamily income is $25,000 or less.

Some regions of the state fall into one ormore of those categories.

Western Illinois has areas with older popu-lations, while parts of Southern Illinois havepopulations with less education and lowerincomes, according to Rudibaugh.

Before a rural broadband curriculum andtraining program is developed, Rudibaughtold Farm Bureau leaders information will beneeded on everything from people’s wantsand needs to how to publicize Internet class-es to people who don’t use the Internet.

Researcher: Education and ageslowing rural broadband adoption

Mike Rudibaugh

Illinois firm to supply transmissioncable to move wind-generated energy

moving ag ahead

FarmWeek Page 4 Monday, March 12, 2012

Vilsack: U.S. still too dependent on foreign oilHigh fuel pricescould slow growthBY DANIEL GRANTFarmWeek

Economic recovery couldbe slowed this year in the U.S.and around the world due tohigh oil and fuel prices.

The price of oil last weekremained above $100 per barreland the Energy InformationAdministration (EIA) recentlypredicted there is a moderatechance oil prices by this sum-mer could reach or surpass$125 per barrel.

EIA projected the pricecould average $100 per barrelfor the year as a whole, com-pared to $94 a year ago.

Meanwhile, the averageprice of a gallon of regulargasoline nationwide the first oflast week reached $3.77, up 27cents from the same time lastyear, the motorist group AAAreported.

The average price of diesel

(Renewable Fuel Standard) andinvest in new opportunities toreduce our reliance on foreignoil and create jobs and incomeopportunities here.”

Vilsack urged Congress topass a farm bill this year with astrong crop insurance compo-nent.

He called for increased fund-

ing for ag research to helpboost food production, and hesaid USDA will continue towork with the EnvironmentalProtection Agency and Depart-ment of Labor so those agen-cies have a “greater understand-ing and appreciation of what(proposed) regulations mean inthe real world.”

fuel surpassed the $4 mark inlate February at $4.05 per gal-lon, up 34 cents from a yearago.

Jason Henderson, vice presi-dent of the Federal ReserveBank of Kansas City, recentlysaid higher fuel prices will hitrural economies particularlyhard as people in rural areastypically drive more and makeless money compared to theirurban and suburban neighbors.

“High gas prices strain ruralbudgets,” Henderson said.

The Ball State UniversityCenter for Business and Eco-nomic Research (CBER)recently estimated a $1increase in the average price ofa gallon of gas would slow theeconomic growth rate in Indi-ana by 1.2 percent.

Fuel prices over the yearshave trended higher as theworldwide daily consumptionof petroleum the past gener-ation has increased from 66million barrels to 85 million

barrels per day.“Demand for gasoline may

place pressure on prices overthe long run,” the CBER notedin a report. “It does not explainthe rapid increase in prices wenow see at the pump.”

Ag Secretary Tom Vilsacksaid pain at the pump would beeven more severe if not for therole of biofuels. Vilsack at theCommodity Classic inNashville said the U.S. mustcontinue to reduce its relianceon foreign oil.

“Were it not for the biofuelsindustry, we’d all be paying $1per gallon more for gas,” saidVilsack, who noted U.S. relianceon foreign oil has been reducedfrom 62 percent to 45 percent.

The Obama administration’sgoal is to reduce reliance onforeign oil by another 33 per-cent in the next decade.

“That would be equivalentto the amount we take from theMiddle East,” Vilsack said.“Let’s maintain the RFS

Ethanol well-positionedto reduce ‘petrorisk’?

Biofuels advocates tout the green benefits of ethanol, the ruraljob creation that’s come with ethanol development, and the mar-ket-based income it’s put into producers’ pockets.

But as pump prices approach or pass the $4 mark, and hostilitiesin major oil-producing regions continue to dominate the headlines,ethanol is gaining ground as a key tool in “petrorisk” management.

So says James Canton, CEO of the Institute for GlobalFutures, who argues the need for the U.S. to “change the ener-gy dynamic” away from predominantly petroleum-based con-sumption. Canton urges development of a “biofuels/smartgrid infrastructure,” with “cities that run on biofuels.”

Worldwide, “geopolitical risk” has at least tripled over thepast two years, with economic instability in the EuropeanUnion, the U.S. “digging out of the real estate, financial deba-cle,” asset/banking issues in Asia, and conflicts in countriesincluding Syria, Turkey, Iran, and Israel.

“(Petroleum dependence) is the largest national security riskwe have facing our nation,” Canton warned. “The issue is not‘if ’ — the only issue is when 49-50 percent of our foreign oildependence becomes complicated by hostile geopolitics. Wedon’t have to wait very long: The situation’s heating up, and willcontinue to heat up.

“But clearly, foreign oil overdependence has not gotten theattention it really deserves as a national security risk in Wash-ington. Somehow, that seems to have escaped policymakers.Somehow, that seems not to make a difference. The economicsseem to trump that.”

Canton argues that “clearly, biofuels are the future, and cer-tainly, they are the ‘now.’” Ethanol currently is the only biofuel“that can scale up (in production) and give us the energy weneed,” he maintained.

Industry and policymakers must chart a “bold future thataccelerates biofuels,” including creation of “the next energy grid,the next vehicles, a complete (biofuels) infrastructure,” he said.

Canton sees four major factors in rising global energydemand: a growing world population, the push for improvedgross domestic product, and a rapidly emerging middle classparticularly in the developing world.

He noted projections that 10 to 20 new “megacities” withpopulations in the millions may emerge in China alone.Accompanying growth in India “is not going to be productive”in terms of global energy tensions, Canton warned.

“The world is not using less — it’s using more,” he said.“Advanced biofuels will protect America’s future economy andsecurity. Petrorisk is geopolitical suicide.” — Martin Ross

Senate eyes highway bill; AFBF offers groundworkBY MARTIN ROSSFarmWeek

As the U.S. Senate takes up transportationdebate, producer groups are fueling efforts tokeep the nation’s highways free of farm regula-tory roadblocks.

Near-term prospects for a Senate surfacetransportation package were uncertain lastweek following failure of a vote to limit amend-ments to the so-called “highway bill” and, ideal-ly, speed passage. The latest extension of exist-ing transportation programs expires March 31.

Senate leaders propose a two-year, $109 bil-lion highway reauthorization. House Trans-

portation Chairman John Mica (R-Fla.) favors afive-year, $260 billion measure, but IllinoisFarm Bureau National Legislative DirectorAdam Nielsen said House leaders may awaitSenate action before proceeding.

Beyond setting the stage for road and bridgefunding, the highway bill also addresses futureregulatory direction for on-road shippers andusers.

In a letter to Senate members, the AmericanFarm Bureau Federation supported amend-ments that would:

• Allow farmers who live near state bordersto transport products to their nearest process-ing facility, even if it is in a neighboring state.On the heels of a successful effort to clarifycommercial “for-hire” carrier rules as they

relate to producers under crop share leases, IFBis seeking clarification of regulations regarding“interstate” vs. “intrastate” movements by pro-ducers in such cases.

• Clarify driving restrictions for farmerstransporting ag goods during planting and har-vest seasons. Some safety interests have chal-lenged ag exemptions from allowable consecu-tive “hours of service” and related commercialdriver requirements, Nielsen noted.

“We’ve always contended that movements ofcommodities and supplies within 150 air milesof the farm to the first point of sale should notbe a regulated movement,” he said.

• Allow farmers and customharvesters with a Class A com-mercial driver’s license to movemore than 118 gallons of dieselfuel without a hazardous mate-rial endorsement.

National Corn GrowersAssociation policy specialistElizabeth Jones shares FarmBureau’s push to clarify inter-state-intrastate issues and pre-serve ag exemptions.

“Our growers travel ourhighways and bridges, and they want to seeinfrastructure maintained and preserved forrural areas,” Jones told FarmWeek. “Ofcourse, all that’s going to be ruled by the budg-et.”

The U.S. Department of Transportation’sFederal Motor Carriers Safety Administration(FMCSA) has indicated it would study inter-state-intrastate concerns. But because of exist-ing interstate commerce laws, Jones believes “itwill probably take some congressional interven-tion.”

IFB is working with lawmakers to fine-tuneexisting proposals designed to ensure relief forfarm drivers. “We’ll know soon if regulatorydiscussions with (FMSCA) will bear any morefruit,” Nielsen added.

‘Our growers travel our highways andbridges, and they want to see infrastruc-ture maintained and preserved for ruralareas.’

— Elizabeth JonesNational Corn Growers Association

eNergy

Page 5 Monday, March 12, 2012 FarmWeek

Ethanol looks to improve market advantagesBY MARTIN ROSSFarmWeek

What do you do whenyou’re particularly well-posi-tioned in the race for the con-sumer fuel dollar?

If you’re the ethanol indus-try, you widen your lead.

Now that federal tax breaksfor corn-based ethanol aregone, the biofuels sector isramping up efforts to boostper-bushel ethanol yields, bringcellulosic ethanol on board at acompetitive cost, develop newproducts to hedge ethanolprofit margins, and fine-tuneplant efficiencies.

As per-gallon pump pricesapproach or top the $4 mark,Illinois Farm Bureau NationalLegislative Director AdamNielsen sees ethanol “well-placed to be a solution in the$5-per-gallon discussion com-ing up.” Last week, a gallon ofethanol was selling for nearly$1 less than a gallon of gaso-line at wholesale.

Iowa-Wisconsin studiesindicate consumers would have

Meanwhile, Chuck Corr,Archer Daniels Midland Co.ethanol technical service man-ager, noted advances in break-ing down increasingly complexsugars within the corn plant togenerate more fuel “withoutproducing any more corn.”

Tapping previously inacces-sible sugars opens the door fordevelopment of marketablenew chemical feedstocks, hesaid. Those “platform chemi-cals” can replace petroleum-based compounds in industrialprocessing or provide “bio-advantaged molecules” thatoffer greenhouse gas reduc-tion, sustainable manufactur-ing, or other improvementsover petrochemical use.

Biobased paints and coat-ings are merely the tip of thatvalue-added iceberg. Corranticipates introduction of

new polymers that canenhance plastics and textilesand a new generation of moreconsumer-friendly biodegrad-able products.

While the industry today isfocused on cost-effectiveimprovements in microbialenzymes used to break starchand fiber down into usable sug-ars, global energy consultantJames Canton anticipates a newera of advanced technology thatcould revolutionize biofuels.

By manipulating materialsat the atomic level — i.e., nan-otechnology — he sees scien-tists employing “syntheticbiology” to spin off new fuelsand creating specific biofuelsblends “beyond the pump.”

“New fuels will come fromhacking matter,” Canton pre-dicted. “It’s innovation, inno-vation, or die.”

paid 89 cents more per gallonof gas in 2010 “without ethanolcoursing through our motorfuel supply,” Nielsen said.

“It all comes back to beinga significant domestic energyresource,” Nielsen argued.“The numbers show, dramati-cally, that ethanol has beenthat in recent years.”

Increasing the gap betweenethanol fuel and gas pricesshould further foster con-sumer support, he suggested.

Vince Kwasniewski, vicepresident of GTL ResourcesUSA, continues to investigateways to lower costs andimprove product value at hiscompany’s Rochelle-based Illi-nois River Energy plant.

Kwasniewski cited the fol-lowing keys to improving pro-duction margins: increasing both

ethanol and co-product distillersdried grain (DDGS) yields,reducing plant electrical costsand energy needs, and optimiz-ing individual operations.

“We’ve continued to updatecomputer software and tech-nology to increase efficien-cies,” Judd Hulting,spokesman with Annawan’sPatriot Renewable Fuels LLC,told FarmWeek. Patriot alsois extracting industrial gradecorn oil for biodiesel and oth-er uses at the back end ofethanol/DDGS production,adding another revenue streamfor the operation.

Corn stover researchyielding surprises

A major ag technology corporation is working to pulltogether a virtual one-stop, agronomically sustainable, farm-to-fuel shop for cellulosic ethanol production.

In 2011, DuPont, hybrid partner Pioneer, and Iowa StateUniversity evaluated stover collection practices on roughly7,500 acres adjacent to a planned ethanol plant site at Nevada,Iowa. Last summer, DuPont Danisco Cellulosic Ethanol(DDCE) selected Nevada for a cellulosic “biorefinery” adjacentto Lincolnway Energy LLC’s corn ethanol plant.

The initial phase of DDCE’s stover research programinvolved 50 farmers; 150 are expected to participate in thisyear’s 25,000-acre trial. On the biomass processing side,DuPont is collaborating with Genencor, its recently acquiredindustrial biosciences/enzymes division.

“We are unique in the (biofuels) space in terms of having allthe components to develop cellulosic ethanol from seed to fuelunder one roof,” DuPont Industrial Biosciences Global Busi-ness Director Steven Mirshak told FarmWeek.

“Pioneer has been very valuable in helping us understand theagronomy of corn stover collection. Our results have been verypositive. We’re finding that residue management is a criticalissue for growers. Collecting about half the residue — we do apartial stover harvest — is very important in high-yieldingfields to improve (future) yield.”

Preserving the conservation/nutrient value of residues hasbeen a major focus of stover-to-ethanol research. Mirshak not-ed growers usually take nutrient value measurements at the timeof silage harvest; DuPont and Iowa State have discovered per-haps 40-50 percent of those nutrients have leached back intothe soil by the time stover is collected.

Thus, the need for soil nutrient replacement following stover har-vest is “much less than most people had expected,” Mirshak related.Researchers also have studied soil organic matter, erosion concerns,and other factors that will play into sustainable stover harvest.

Mirshak reported DuPont is focusing on higher-yieldingfields “where we see the greatest benefit for and the greatestneed for residue management.” Once a field reaches roughly170 bushels per acre, he said, excess stover can result in standestablishment concerns.

“Yields will continue to increase over the years, as they havefor the past 60 to 80 years, so residue management will contin-ue to be an important issue,” Mirshak noted. “What we’redoing will be a service to farmers.” — Martin Ross

Breaking down the costsBringing down the cost of breaking down bio-

mass is crucial to bringing cellulosic ethanol tothe pump, according to Novozymes ExecutiveVice President Peder Holk Nielsen.

Novozymes, a Denmark-based global biotech company,has released the latest in its Cel-lic CTec line of enzymes thatcan be used to break down cel-lulosic fiber and extract sugarsneeded to produce ethanol. Cel-lic CTec3 is 1 1/2 times moreefficient than Novozymes’ pred-ecessor product, Cellic CTec2.

Fifty kilograms of CellicCTec3 reportedly can yield the

same amount of biomass ethanol as 250 kilo-grams of competing enzymes. CTec3 is a“robust” enzyme that can break down a variety ofmaterials including corn stover, Nielsen noted.

Enzyme costs have been a major challenge forcellulosic ethanol producers. More efficientenzymes mean ethanol could be produced for $2-$2.50 per gallon, Nielsen told FarmWeek.

“If the plants were there, cellulosic ethanolprobably would be competitive with cornethanol and gasoline,” he said. “It’s importantto bring cellulosic ethanol into the bracketwhere it’s commercially viable.

“Cellulosic ethanol will only make it if it’scompetitive on its own merits. We don’t believe ina world of subsidies moving forward.”

Novozymes hopes to demonstrate cellulosicethanol viabilitythrough partner-ships with Italy’sM&G Group,which ownsresearch-devel-opment facilitiesin Italy, Brazil, and Ohio, and Fiberight, a Mary-land-based corporation that’s focused on convert-ing municipal wastes and biomass into fuel. Bothare set to begin production using CTec3 this year.

While Nielsen maintains biofuels must standon their own in the market, he stresses theimportance of national policies such as the U.S.Renewable Fuels Standard, which encouragesrenewable fuel development and use.

“What politicians may be ignoring is that thetechnology is actually ready and is available assoon we have the demonstration plants up andrunning,” Nielsen said.

“Then, we will have proven to the world thatone can actually break down agricultural waste,turn it into sugar, ferment it into ethanol, andput it into a car at a price that is competitivewith ethanol.” — Martin Ross

Peder HolkNielsen

The Senate highway billcould prove the key to puttingthe now-lapsed biodiesel taxcredit back on the road.

Senate Ag Committee Chair-man Debbie Stabenow (D-Mich.) has unveiled a highwaybill amendment that wouldextend the $1-per-gallon credit,which expired Jan. 1 followingan 11th-hour, one-year exten-sion in December 2010.

National Biodiesel BoardVice President Anne Steckelargues credit extension would“help end our dangerous vul-nerability to the kinds of oilprice spikes we’re seeing.”

Industry downsizing

occurred in 2010 followingnearly a year’s lapse in the cred-it. Renewable Energy Group(REG) corporate affairs man-ager Alicia Clancy stressed theindustry is better to weatherthe current tax credit lapsethan it was in 2010: The federalRenewable Fuels Standard(RFS2) set a demand-driving 1-billion-gallon biodiesel userequirement for 2012.

But biodiesel interests simul-taneously are seeking creditextension and a 1.28-billion-gallon RFS2 target for 2013,Clancy told FarmWeek. Shewas encouraged by speculationthat Senate highway measures

could move this week.“First of all, (Stabenow’s)

amendment would need toreceive 60 votes, and then thatamendment would need to stayattached to the highway bill,”Clancy acknowledged. “Andthen the highway bill wouldhave to be passed.

“We have a lot of steps, butit’s definitely exciting to seethere’s still support for thebiodiesel tax incentive. It’sgreat that it’s getting play thisearly in the year.”

REG oversees 105 milliongallons of annual biodieselproduction in Danville andSeneca. — Martin Ross

Highway bill key to credit extension?

FarmWeekNow.com

View a video with Peder HolkNielsen about the cost of biofuelsat FarmWeekNow.com.

productioN

FarmWeek Page 6 Monday, March 12, 2012

USDA cuts S. Americansoy production forecastBY DANIEL GRANTFarmWeek

Soybean prices may continue to strengthen as USDA on Fridaycut its soybean production estimates for Argentina and Brazil.

Brazilian soybean production currently is forecast to total68.5 million tons (2.53 billion bushels), down 3.5 million tons(130 million bushels) from the previous forecast.

Soybean production in Argentina was projected to total46.5 million tons (1.72 billionbushels), down 1.5 milliontons (55 million bushels)from the previous forecast.

“This report should befriendly to beans,” said RandyMartinson, market analyst withProgressive Ag, during a teleconference hosted by the Min-neapolis Grain Exchange.

Soy future prices on Friday were well above $13 per bushel.USDA raised its 2011-12 season average price estimate forbeans by 30 cents to a range of $11.40 to $12.60.

USDA projections on Friday weren’t as friendly for corn. Corn ending stocks were left unchanged at 801 million

bushels (soybean stocks also were unchanged at 275 millionbushels). Traders generally were looking for a slight decreasein ending stocks of both crops.

Meanwhile, USDA increased its estimate for Brazilian cornproduction by 1 million metric tons (39 million bushels) andleft its corn production estimate for Argentina unchanged,despite heat and dryness issues there.

“The (corn) stocks are somewhat bearish,” Martinson said.“The trade was looking for a decline.”

USDA lowered its season-average price forecast for corn bya dime to a range of $5.90 to $6.50 per bushel.

Wheat estimates were supportive of prices as USDA on Fridaylowered wheat ending stocks by 20 million bushels to 825 millionbushels. U.S. wheat exports were raised 25 million bushels.

“The wheat numbers should be somewhat friendly,” Mar-tinson said. “Sales have been fairly brisk.”

USDA projected the season-average price for wheat to rangefrom $7.15 to $7.45 per bushel, unchanged from last month.

Martinson noted the focus of traders now will turn toupcoming stocks estimates and USDA’s prospective plantingreport on March 30.

Harvest expected to commence this weekBY PHIL CORZINE

I’m inBrazil makinga pre-harvestvisit of ourfarms with ourcompany mer-chandisingmanager, KentSorrells. Kenthas been busythe last several

days contracting an additional56,000 bushels ofour soon-to-be-harvested soy-beans at an aver-age price of$11.15 perbushel.

One of the sales is to a newbuyer in our region, our fourthbuyer, and we expect the com-pletion of the North-Southrailroad to bring even morecompetition — and betterprices.

Although our prices arealmost $2 per bushel less thanKent is paying at his Raymond,

Ill., elevator, they are still 80cents per bushel above our aver-age sales price for last year’scrop.

Going into harvest, we’re 65percent sold cash and 20 per-cent covered with options.

We expect harvest on ourfirst farm of 1,360 acres to startthis Thursday, and we are look-ing for above-average yields.

Our access to the Bungefacility near this farm has been

complicated by problems withthe bridge crossing the RioTocantins – lowered allowableweight limits are forcing us tolook for buyers on our side ofthe river.

Over the past month, ourrains have been very regular —totally the opposite of whatfarmers in the south of Brazil

have been xperiencing.Harvest should start on the

balance of our farms by April 1.Reports indicate prices

across much of the north ofBrazil are at these same levels,and $11 beans will almost cer-tainly have more farmers look-ing for pastures to convert tosoybeans for the 2012-2013crop.

In mid-April, while our har-vest is in full swing, we’ll start

converting another4,450 acres of pasture toget it ready to plant inNovember.

Two trips over theland with a heavy discon our heavy clay soils

will burn a lot of diesel fuel,and at $5 a gallon, our local fuelsupplier will be a happy man.

Phil Corzine is general managerof South American Soy, a globalproduction management andinvestment company. His e-mail address is pcorz ine -@agpage.com.

FarmWeekNow.comListen to analysts’ commentsabout the latest USDA sup-p l y - d e m a n d r e p o r t a tFarmWeekNow.com.

Phil Corzine

GROWMARK Inc. lastweek filed a lawsuit in FultonCounty circuit court seeking todirect the board of directors ofWestern Illinois’ Sunrise AgService Co. to reverse recentaction it took in an effort toleave the GROWMARK Sys-tem.

The suit, filed on behalfof all shareholders of theVirginia, Ill.-based servicecompany, asks the court todirect the Sunrise board toreverse its attempt torestructure the ownershipand governance of the com-pany “in violation of thecompany’s articles of incor-poration and bylaws andwithout shareholder

approval,” according to aGROWMARK news release.

Sunrise Ag had planned toask its shareholders for per-mission to terminate its affilia-tion with the GROWMARKsystem and merge with CHSInc., a Minnesota basedregional cooperative formedby the merger of Cenex andHarvest States.

It was reported that theSunrise leadership had indicat-ed the GROWMARK mem-bership agreement restricts thecompany’s ability to growbeyond its current service area.

Attempts last week to reachthe Sunrise Ag board presi-dent, Charles Taylor of Vir-ginia, were unsuccessful.

Sunrise serves Cass,Mason, and half of FultonCounty and has been affiliat-ed with GROWMARK andFarm Bureau for about 75years.

“That affiliation, whichincludes GROWMARK hold-ing an ownership interest andvoting rights in the company,has existed ever since,” saidDan Kelley, GROWMARKchairman of the board andpresident.

GROWMARK held 100percent of Sunrise Ag’sissued and outstandingClass B Preferred Stockuntil last December whenthe Sunrise board attemptedto eliminate GROW-MARK’S exclusive owner-ship of the stock.

The action was taken with-out prior notice to GROW-MARK or other shareholdersby issuing additional shares ofClass B stock to individualdirectors of Sunrise Ag. Thataction improperly attempted totransfer control of that classof stock to the Sunrise direc-tors, Kelley said.

“GROWMARK’s primarygoal in this matter is to pre-serve and protect the farmersand member cooperativeswhich make up the FS Sys-tem,” said Kelley.

“We had hoped legal actionwouldn’t be necessary, but theSunrise Ag board has notresponded to our repeatedrequests to rescind its action.”

GROWMARK files suitover Sunrise Ag action

USDA offering rural economicdevelopment loans and grants

USDA Rural Development is seeking applications for $33 mil-lion in loans and $10 million in grants to help rural businesses.

In addition, Rural Development has another $46 million inloans available from previous fiscal years.

The funding is provided under the Rural Economic Develop-ment Loan and Grant (REDLG) program. USDA provides zero-interest loans to local utility cooperatives that then pass throughloans to local businesses at zero percent interest.

The money must be used for projects that retain and createjobs, upgrade public infrastructure, improve service delivery, orimprove the quality of life for area residents and visitors.

Grants may be used to create revolving loan programs forlocal businesses. The maximum amount per project is $1 millionfor loans and $300,000 for grants.

“Our partnership with cooperatives and utilities helps usextend our capacity to help rural Illinois businesses,” saidColleen Callahan, state director for Illinois Rural Development.

Currently in Illinois, eight electric co-ops that serve 63 counties areusing Rural Development funds to support local business projects.Many Illinois groups have used REDLG funds to support job creation.

Earlier this year, the Coles-Moultrie Electric Cooperative ofMattoon received a $740,000 loan and a $100,000 grant to providefinancing for the renovation and modernization of the Sarah BushLincoln Health Center. Last year the co-op received REDLG fund-ing to help build CCI Redi-Mix’s new plant near Mattoon.

The deadline to submit applications is the last business day ofeach month during fiscal year 2012. Applications must be sub-mitted to the Rural Development state office.

management

Page 7 Monday, March 12, 2012 FarmWeek

New tools help farmers combat resistant weeds, droughtBY DANIEL GRANTFarmWeek

Ag seed and chemicalcompanies this month atthe Commodity Classic inNashville unveiled newproduct releases andupdates designed to helpfarmers combat two majoryield robbers — herbicide-resistant weeds anddrought.

There currently are 13weed species in 27 statesthat have confirmed resist-ance to various types ofherbicide. One of the mostdisturbing trends isincreased resistance toglyphosate, the key herbi-cide used in RoundupReady systems.

About 50 percent ofcrop farmers in the U.S.deal with glyphosate-resis-tant weeds each season.

“It’s a significant pro-duction issue for growers,”said Paul Rea, vice presi-dent of U.S. crop protec-tion for BASF. “Close totwo-thirds of Illinois isaffected by some form ofglyphosate resistance.”

Glyphosate-resistantpigweed can grow as muchas 3 inches per day whilewaterhemp also hasbecome very difficult forsome growers to control,particularly in the southernU.S.

Farmers in Georgia lastyear hired workers to hand-weed about half the state’scrop acres, at a cost ofabout $16 million, accord-ing to Rea. Yield losses toweeds there still totaled anestimated $110 million.

“The total post-emer-gence era is over. We haveto use all the tools in thetoolbox (to controlweeds),” said Larry Steckel,weed specialist at the Uni-versity of Tennessee.“Growers in the Midwestcan learn from our mis-takes (in the South) and beproactive on this.”

BASF at the classicunveiled Engenia herbicide,an advanced dicamba for-mulation that in comingyears will help farmers bat-

tle 100 annual broadleafweeds includingglyphosate-resistant Palmeramaranth, waterhemp, andmarestail, according to thecompany.

Meanwhile, Monsanto atthe event unveiled its newRoundup Ready XtendCrop System, which isdesigned to improve weedcontrol and maximize cropyield potential.

Roundup Xtend, whichhas dual modes of action,is an enhanced dicambaand glyphosate herbicidepremix that will allowfarmers to manage weedsat planting and as an over-the-top option during theseason.

Bayer CropScienceannounced the globalbrand Liberty herbicidewill replace Ignite for useon LibertyLink crops thisseason. Liberty herbicide isa key management tool tobattle glyphosate-resistantweeds.

Robert Wolf, owner ofWolf Consulting andResearch in Mahomet,stressed that improved her-bicide application methodsalso are key to controllingweeds. Wolf Consultingtrains applicators throughits On Target ApplicationAcademy.

“It’s hands-on trainingto get growers in the frameof mind that if they getproducts on target, theycan achieve better weedcontrol and reduce drift,”Wolf said.

Elsewhere at CommodityClassic, Pioneer Hi-Bredreported 2011 on-farm tri-als showed OptimumAQUAmax corn hybridsprovided a competitiveadvantage over otherhybrids in water-limitedenvironments and in favor-able growing conditions.

“Initial data suggeststhere is less water used perbushel with these prod-ucts,” said Jeff Schussler,Pioneer senior researchmanager.

The drought-tolerantAQUAmax hybrids weredeveloped with native traitsand are expected to bemore widely available incoming years.

Robert Wolf, former Kansas State University professor who currently owns Wolf Consulting and Research inMahomet, spotlights water droplets coming out of a sprayer nozzle at the Commodity Classic in Nashville.Wolf works with chemical applicators to help them improve the efficiency and effectiveness of applications inan effort to improve weed control and reduce spray drift. (Photo by Daniel Grant)

U of I to mark Teach Ag DayThe University of Illinois College of Agricultural, Consumer,

and Environmental Sciences will mark National Teach Ag DayThursday to raise awareness of careers in agricultural educationand recognize ag teachers.

The U of I Ag Ed Club sponsored activities during last week’sExplorACES. Club members also sent 511 thank you notes tohigh school and junior college agricultural educators across thestate.

water

FarmWeek Page 8 Monday, March 12, 2012

BY KAY SHIPMANFarmWeek

Farmers will try differentnutrient management strategiesin several watershed projectsthis year, county Farm Bureauleaders learned recently.

Courts, House deliberate water rights issuesBY MARTIN ROSSFarmWeek

Increasingly, water is a hot— and hotly contested —commodity as producers jos-tle with urban interests andenvironmentalists for availablesupplies.

Recent actions by the U.S.House and a Texas courthighlight efforts to equitablyregulate rapidly competingdemands for rural water.

Western water issues maybe coming to a head, butwater issues “absolutely” arebrewing in the Midwest amidcontinued urban growth, Illi-nois Farm Bureau NationalLegislative Director AdamNielsen advised.

Beyond competingdemands, perceived water usefor ethanol production hasspurred resistance to siting ofnew plants near communities,including Champaign.

The Texas Supreme Courthas ruled landowners own

Joaquin Valley. Valley farmersleft 100,000 acres fallow in2009 because of inadequatewater supplies related to threeyears of drought and waterdiversion for the federallythreatened delta smelt resultedin state and federal officialscurtailing irrigation waterdeliveries.

California’s Central ValleyProject, a federal program thatsupplies water for irrigationand municipal use, has been“plagued by fish problems,endangered species prob-lems,” said Chris Scheuring,California Farm Bureau Feder-ation’s (CFBF) naturalresources-environmental divi-sion managing counsel.

CFBF hasn’t taken a formalposition on Rep. DevinNunes’ (R-Calif.) proposal to

restore supplies, but “we’refollowing it with great inter-est,” Scheuring toldFarmWeek.

“The reason we’re in a giantdemand crunch is because ofthe explosive urban growth inthe American West, as well asthe environmental policy over-lay that has been put intoplace over the last generationto restrict water rights,” hesaid.

Unfortunately, Nunes’ billmay dead-end in the moreenvironmentally orientedDemocrat-led Senate. Scheur-ing reported one key Califor-nia senator is stronglyopposed to the bill, and theWhite House has threatenedto veto it, but suggested itcould be used to forge a com-promise measure.

groundwater under them aspart of their land and must becompensated if it is taken forpublic use. Texas Farm BureauPresident Kenneth Dierschkecalled the ruling “another in along line of recent successesdefending private propertyrights.”

The U.S. House, meanwhile,has voted to cap the amount ofwater allowed to flow into Cal-

ifornia’s San Francisco Bay forendangered species and restorewater deliveries to the San

Groundwater Awareness Weekgood time to have well checked

About half the U.S. population receives its drinking waterfrom wells.

In addition to many cities in Illinois that get some or all oftheir drinking water from groundwater sources, almost all ruralresidents use groundwater.

During National Groundwater Awareness Week this week,well users are reminded that spring is a good time to have anannual well checkup before the peak water use season begins.

An annual checkup by a qualified water well contractor is thebest way to ensure problem-free service and quality.

Also, the Illinois State Water Survey Public Service Labora-tory (PSL) provides a complete mineral analysis for private wellowners for $35.

To contact the PSL for a sample test kit, call 217-333-9321.For a bacteriological analysis, contact your local public healthdepartment.

Nutrient management key for watershed projectsTerry Bachtold and John

Traub with Livingston Coun-ty’s Indian Creek Watershedproject and Dan Schaefer withthe Keep it for the Crop (KIC)by 2025 initiative discussedtheir respective projects at therecent Illinois Farm BureauGovernmental Affairs Leader-ship Conference in Springfield.

“The key is to make nitro-gen (fertilization) a systemwith multiple applications vs. aone-time application,” Schae-fer advised farmers.

In the six priority water-sheds, participating farmerswill be testing in-field trialswith nitrogen rates of zero, 50,100, 150, and 200 pounds peracre. The rate trials will bereplicated three times in thefield. Schaefer’s goal is to haveat least 40 on-farm rate trials.

Similar nitrogen manage-ment has been shown toincrease corn yields an averageof 17 bushels per acre, Schae-fer told the farmers.

KIC participating farmersaren’t the only ones working toimprove water quality.

Traub, who farms near Fair-bury, described how he hasused the Conservation Stew-ardship Program (CSP) whenhe wanted to add differentconservation practices. Traubserves on the steering commit-

tee of the watershed project.He encouraged farmers to

investigate CSP and not to beintimidated. “Once I got intoit, it was not as daunting as Ifirst thought,” he said. “As wewent through CSP, we choseenhancements that fit ouroperation easily.”

Bachtold of the LivingstonCounty Soil and Water Con-servation District said 33 per-cent of cropland acres areinvolved with the projectwithin the 51,000-acre water-shed. Also within the water-shed, most of the livestockfarmers have comprehensivenutrient management plans,he said.

This year’s on-farm projectswill include studies of variablenitrogen rates and late nitro-gen application comparisons.

For more information aboutKIC, go online to{www.KIC2025.org}. Infor-mation about the Indian CreekWatershed project is at{www.ctic.purdue.edu/Indian-Creek/}.

from the counties

Page 9 Monday, March 12, 2012 FarmWeek

BUREAU — TheBureau County Ag Fair

will host fourth grade students,teachers, and volunteers whowill participate in several learn-ing stations. The stations willinclude dairy, wheat, safety,pork, corn, soybeans, technol-ogy, and large and small ani-mals. A goodie bag whichincludes items from coloringbooks to pencils will be givento each student.

• The Women’s Committeewill sponsor a teacher appreci-ation dinner and a Ag in theClassroom training lesson at4:30 p.m. Wednesday, March21, at the Farm Bureau office.Continuing professional devel-opment units will be available.Educators can call the FarmBureau office by Wednesdayfor reservations or more infor-mation.

• Farm Bureau will sponsoran informational meeting forthe New Zealand and Australiatrip at 2 p.m. Thursday, March29, at the Farm Bureau office.The trip will be Jan. 22-Feb. 7,2013.

• Farm Bureau will sponsorwellness screenings from 8:30a.m. to 3:30 p.m. Tuesday,April 3, at the Farm Bureauoffice. Screenings will includecarotid arteries, abdominal aor-tic aneurysm, peripheral arterydisease, and osteoporosis. Call877-732-8258 for an appoint-ment.

• A listing for Bureau Coun-ty residents who are interestedin full or part-time agriculturallabor has been compiled. Callthe Farm Bureau office toobtain the list.

CHAMPAIGN — FarmBureau will sponsor a

“meet the buyers” seminarfrom 8:30 a.m. to 5 p.m. Tues-day, March 27, at the FarmBureau office. Food industrybuyers from Illinois will attendto provide an overview oftheir organization and pro-curement needs. Call the FarmBureau office at 217-352-5235by Thursday, March 22, forreservations or more informa-tion.

• A “Food Hub” event willbe from 7 to 9 p.m. Tuesday,March 27, following the “meetthe buyers” seminar at theFarm Bureau office. Foodhubs and packing sheds andthe financial opportunities theyoffer will be discussed. Callthe Farm Bureau office at 217-352-5235 for reservations ormore information.

• An east central Illinoisregional water stakeholder’sconference will be at 8 a.m.Thursday, March 29, at theHoliday Inn, Urbana. TheMahomet aquifer and watersupply planning and manage-ment will be discussed. Cost is$30. Call Robbie Berg at 217-493-7407 by Friday for reser-vations or more information.

CUMBERLAND —

The Women’s Commit-tee will sponsor a coloringcontest in celebration of Illi-nois Farming Month. Therewill be three groups — 3 to 5years old; 6 to 8 years old; and9 to 11 years old, with the topthree in each group receivingcash and prizes. Stop by theoffice to pick up a coloringsheet.

• The Women’s Committeewill sponsor an amateur photocontest for ages 12 years andolder during Illinois FarmersMonth. Enter a framed 4 x 6inch print in one of the threecategories — nature and land-scapes, animals, and farm-related miscellaneous. Onepicture per category will beallowed. Photo must havebeen taken in CumberlandCounty within the last threeyears. The winner in each cat-egory will receive a cash prizeand have his or her photo ondisplay at the Farm Bureauoffice for a year. Entry dead-line is March 30. Call the FarmBureau office at 217-849-3031for more information.

• Farm Bureau has 2012 platbooks available. Call the FarmBureau office at 217-840-3031for more information.

DEWITT — FarmBureau will sponsor an

“On the Road” seminar at 1:30p.m. Wednesday at the Univer-sity of Illinois Extensionoffice, Clinton. Call the FarmBureau office for more infor-mation.

• The Young Leaders Har-vest for All food drive will befrom 10 a.m. to 2 p.m. Satur-day at Niemann Market inFarmer City and Save-A-Lotand IGA stores in Clinton.

DOUGLAS — FarmBureau will sponsor

farmer appreciation breakfastsduring the month of March.All will begin at 7:30 a.m. at thefollowing dates and locations:Monday, March 19, CountryJunction, Newman; Tuesday,March 20, Deb’s Café, VillaGrove; Wednesday, March 21,R&I, Arthur; Thursday, March22, Downtown Diner, Tuscola;and Friday, March 23, DutchKitchen, Arcola. A descriptionof the field fire readiness pro-gram will be given during thebreakfasts.

DUPAGE — FarmBureau will sponsor

the Agricultural EducationExpo Wednesday and Thurs-day at the DuPage CountyFairgrounds. Third andfourth grade students andtheir teachers will learnabout the many differentaspects of agriculture. Infor-mal classrooms will present adifferent ingredient for mak-ing a pizza, i.e., grains, veg-etables, dairy, livestock, andnutrition. Students willreceive a slice of pizza.

EDWARDS — FarmBureau and the

Edwards County FFA willsponsor a Farmer’s Sharebreakfast from 7 to 9 a.m. Sat-urday at the Farm Bureauoffice. Displays depictingagriculture will be shown atlocal banks during the month.

EFFINGHAM — FarmBureau will celebrate

Illinois Farming Month bysponsoring agriculturalquizzes on local radio stations.Multiple choice questions onagriculture will air on WXEFand WKJT radio stations.Winners will receive a $25 giftcertificate to a local grocerystore or gas station.

• The Commodities andMarketing Action Team willsponsor an agricultural out-look meeting at 7 p.m. Mon-day, March 19, at the Farmbureau office. Kim Holsapple,Total Grain Marketing manag-er and merchandiser, will bethe speaker. Call the FarmBureau office at 217-342-2103for reservations or more infor-mation.

FAYETTE — FarmBureau and Country

Financial will sponsor twoprograms on ATV safety Sat-urday, March 24, at the FarmBureau office. The first classwill be from 9 to 11 a.m. forfourth through eighth gradestudents and their parents.The second class will be fromnoon to 2 p.m. for high schoolstudents. Call the Farm Bureauoffice at 618-283-3276 or visitthe website at {www.fayet-tefb.com} for more informa-tion.

FULTON — TheWomen’s Committee

will sponsor a “Care-Give”seminar at 6 p.m. Wednesdayat the Farm Bureau office.Cheryl Parmenter, SunsetManor, will share informationon home care and servicesavailable to care-givers andthose they help. Call the FarmBureau office by Monday(today) at 547-3011 for reser-vations or more information.

• Farm Bureau will host afarmer’s share breakfast from7 to 10 a.m. Saturday at theFarm Bureau office. Cost is81 cents. Call the Farm Bureauoffice for more information.

KANE — The Ag Liter-acy Program and

Women’s Committee willsponsor the annual Ag DaysTuesday through Thursday,March 20-22, at MooseheartFieldhouse. Approximately2,000 students will attend tohear presentations from areafarmers, agribusiness repre-sentatives, and Farm Bureauvolunteers on agricultural top-ics. Students will receivegoodie bags filled with farm-related lessons and activities.

LEE — The Public Rela-tions Committee will

sponsor the annual farmer’sshare breakfast from 8 to 11a.m. Saturday at the LovelandCommunity Building, Dixon.Cost for the pancake andsausage breakfast will be 40cents, representing the actualamount of income a farmerwould receive from the break-fast. • In celebration of IllinoisFarming Month, Farm Bureauhas Lee County plat booksavailable for $20 each or twofor $30 during the month. Callthe Farm Bureau office at 857-3531 for more information.

LIVINGSTON — FarmBureau will sponsor an

“On the Road” seminar at 7p.m. Thursday, March 29, at theFarm Bureau office. KevinRund, Illinois Farm Bureausenior director of local govern-ment, will be the speaker.Trucking laws will be dis-cussed. Call the Farm Bureauoffice at 815-842-1103 forreservations or more informa-tion.

• A program — ProjectPAIL (promoting agriculturein literature) — will have aguest reader read the book“Seed-Soil-Sun” by Cris Peter-son to second grade students.

• The Women’s Committeewill donate two agricultural-related children’s books —“Awesome Agriculture: Corn,an A-Z Book” and “Corn inthe Story of Agriculture” — to20 grade school libraries.

• An agriculture insert willbe provided to local churches.The bulletin gives thanks toour country’s farmers.

• Placemats made by stu-dents who participated in aposter contest with the theme“Farmers Feed Me” were dis-tributed to area restaurants.

• Farm Bureau will host adaily question about agricul-ture on radio station WJEZ.Each day the winning callerwill receive a $25 FS gas card,compliments of EvergreenFS.

• The Young Leaders Com-mittee will present a basket“Welcome to the Ag World”to the first baby born at OSFSt. James Hospital duringMarch. The basket containsproducts that come from thefarm used in infant care, suchas baby powers, oatmeal cere-al, soy oil, Baby Basic Puffs,and baby food.

•A “One Farmer Feeds 155People” display will be on theFarm Bureau lawn. TheYoung Leaders and FFAchapters created a yard dis-play of 155 one-foot plywoodpeople to represent the num-ber of people a farmer feeds.Each chapter painted its“people” the local school col-ors.

• During Illinois FarmersWeek, Farm Bureau members

will receive a 10 percent dis-

count on purchases at the

Pontiac Big R store.

MARION — FarmBureau will sponsor a

breakfast from 6 to 9 a.m.Wednesday at the FarmBureau office. Scrambledeggs, biscuits and gravy,orange juice, milk, and coffeewill be served. Cost is 50cents, which representsincome received by a farmerfor the commodities. No car-ryouts will be allowed. TheIllinois Farm Bureau RFDnetwork will do a remotebroadcast during the event.

MONROE — Aninformational meet-

ing for school district resi-dents on proposed schoolpropositions that will be onthe March 20 ballot will be at7 p.m. Tuesday at the Valmey-er School.

ST. CLAIR — TheYoung Farmers and

Country Financial will spon-sor a family farm continua-tion information meeting willbe at 6 p.m. Monday, March26, at the Farm Bureau office.Dinner will be served. Callthe Farm Bureau office at618-233-6800 by Friday forreservations or more infor-mation.

MONTGOMERY —

The Prime Timerswill meet at noon Wednesday,March 21, at the Lion’s Club,Hillsboro. A corned beef andcabbage dinner will be servedfor $8. Peggy Kessinger, Rus-sell Young, and John Meinerwill provide “Old Country”music. Call the Farm Bureauoffice at 217-532-6171 byMonday, March 19, for reser-vations or more information.

STARK — Stark CountyFarm Bureau Founda-

tion applications are availableat the Farm Bureau office.Applicants must be StarkCounty Farm Bureau mem-bers, dependents of a mem-ber, or a Stark County resi-dent pursuing a degree in anagricultural-related field ofstudy. Deadline to returnapplications is 4:30 p.m.March 31. Call the FarmBureau office at 286-7481 formore information.

UNION — FarmBureau will sponsor a

tractor drive at 9 a.m. Satur-day, March 24. Proceeds willbenefit the scholarship pro-gram. Cost is $20. Call theFarm Bureau office at 618-833-2125 for more informa-tion.

VERMILION — TheYoung Leaders will

collect groceries for the Oak-wood area food pantry at theCatlin and Oakwood IGAstores the week of March 19.Shoppers may leave donationsin marked shopping carts ateither location.

profitability

FarmWeek Page 10 Monday, March 12, 2012

Export inspections(Million bushels)

Week ending Soybeans Wheat Corn03-01-12 32.6 16.9 31.002-23-12 39.4 10.2 28.5Last year 28.3 21.6 46.0Season total 907.8 742.4 835.6Previous season total 1180.6 884.1 850.2USDA projected total 1275 1000 1700Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

Feeder pig prices reported to USDA*Weight Range Per Head Weighted Ave. Price10 lbs. $33.08-$61.00 $43.7840 lbs. $70.17-$79.22 $73.3750 lbs. no longer reported by USDAReceipts This Week Last Week 126,294 106,215*Eastern Corn Belt prices picked up at seller’s farm

MARKET FACTS

Eastern Corn Belt direct hogs (plant delivered)(Prices $ per hundredweight)

This week Prev. week ChangeCarcass $84.85 $80.65 4.20Live $62.79 $59.68 3.11

(Thursday’s price)This week Prev. week Change

Steers 125.65 129.80 -4.15 Heifers 125.00 130.27 -5.27

USDA five-state area slaughter cattle price

This is a composite price of feeder cattle transactions in 27 states.(Prices $ per hundredweight)

This week Prev. week Change $156.36 156.42 -0.06

CME feeder cattle index — 600-800 Lbs.

Lamb prices

(Thursday’s price)

Slaughter Prices - Negotiated, Live, wooled and shorn 100-160 lbs. for148.25-183.13 $/cwt. (wtd. ave. 156.68); dressed, no sales reported.

You get one chance at a uniform plant standBY LANCE RUPPERT

If you are like me, “MarchMadness” means the excite-ment of the NCAA basketballtournament. There is some-

thing specialabout watch-ing the magi-cal ride as thepool dwindlesfrom 68 tothe champion.

Knowing aloss meansthe end of the

tournament for your teambuilds a sense of urgency. Theoptimists among us know thatevery team that takes the court

has the opportunity to win itall, regardless of what cameearlier in the season.

I think farmers also experi-ence their own form of“March Madness.” A sense ofurgency and optimism typicallycome over farmers when thecalendar flips to March.

There is the feeling that thisyear’s corn and soybean cropscould be the best ever and thatwhen the time comes, we mustget the crop planted quickly.

Before basketball teams takethe court, they put together awell thought-out plan on howto increase their chances ofwinning the game. Before you

start the planting season, taketime to finalize your strategy toincrease your chances of grow-ing a winning crop.

Revisit the corn hybrids andsoybean varieties you have pur-chased and understand whichfields they are best suited for.

Understand what technolo-gies you have and the properInsect Resistance Management(IRM) refuge requirementsthat go along with growingand preserving those tech-nologies.

Prepare your equipment towork at its highest potential bychecking your planter and itsability to plant with even spac-

ing, depth, and proper singula-tion. You want to plant onlyonce, so getting it right thefirst time is critical to your suc-cess.

Consider soil conditions atplanting and the ramifica-tions of pushing the enve-lope too hard when it may bea bit too wet. Planting even aday early can come back andhurt you if root growth isrestricted or if stands aremarginal due to less than ide-al soil conditions.

You usually get a secondchance to control weeds, andin many cases we can supple-ment nitrogen throughout the

growing season, but you onlyget one chance to establish agood, uniform stand.

Tap into the expertise fromyour local FS team, which canbe invaluable in helping youmake the right decisions to getthat good start to this year’scrop year.

It’s worth a lot to yourfarming business. Be carefulto not let your sense ofurgency keep your optimismfrom coming true.

Lance Ruppert is the FS Seedsales and marketing manager. Hise-mail address is lruppert@grow-mark.com.

Lance Ruppert

Crop farmers advised to protect against downside price riskBY DANIEL GRANTFarmWeek

Market analysts last week atthe WILL AM 580 ag outlookmeeting in Covington, Ind.,advised crop farmers to pro-tect themselves against down-side price risk this year.

Corn prices easily could fall50 cents to $1-plus per bushelby this fall if farmers harvest arecord crop, according to someanalysts.

USDA last month projectedU.S. farmers this spring willplant 94 million acres of corn,which would be the highesttotal since 1944. If the weath-er cooperates and the nationalyield averages 164 bushels peracre, corn harvest for the first

time ever could top 14 billionbushels.

“You need new-crop cover-age (for corn),” Wayne Nelsonof L and M Commodities inNew Market, Ind., told thesell-out crowd of farmers atthe WILL meeting. “There’s achance corn prices could drop50 cents to $1 if we get whatUSDA is calling for (recordproduction).”

Curt Kimmel of Bates Com-modities in Bloomington agreedfarmers need to protect them-selves from violent price swings.

“The No. 1 strategy rightnow is to stay flexible,” hesaid. “But I think you need apaper position to keep a floorunder you. You need some

type of support for downsideprotection.”

Analysts did not questionUSDA’s initial projection formore corn plantings. In fact,Dan Zwicker of ADM GrainGroup in Decatur believes itcould be low considering thecorn/soy ratio recently hit afive-year low, which favorsplanting more corn.

“Intentions to plant cornare big,” he said. “It could be95 million-plus (acres)” ifspring weather is conducive toplanting.

Other analysts, though,questioned whether farmerscan achieve the high yield pro-jection. A large boost in plant-ed acreage could draw in lessproductive acres, they said.

And there may not beenough quality corn seed toplant that many acres andachieve high yields, accordingto Jacquie Voeks of StewartPeterson Group in Cham-paign.

“As we push to 94 or even95 million acres, we’ll be bring-ing in less productive acres,”said Matt Bennett of TotalGrain Marketing in Windsor.“When you push this manyacres, you’re going to drop the

national yield average.”The projected flush of new

corn production still is depend-ent on weather and yieldprospects in South America.

Meanwhile, supplies of old-crop corn remain tight, whichhas kept basis levels strong inmany areas.

“Old-crop and new-cropcorn are two different com-modities,” said Greg Johnsonof The Andersons in Cham-paign, who noted old-cropcorn recently traded at a 90-cent premium to new-cropproduction.

Analysts at the WILL meet-ing generally didn’t forecast asmuch downside price risk forsoybeans as they did for corn.USDA last month projectedsoy acreage this year will beabout the same as last year (75million acres).

World meat demand could boost livestock feedingProfitability in the livestock sector, fueled by

surging meat exports, could lead to a smallexpansion of the U.S. herd this year, accordingto one economist.

Chris Hurt, ag economist at Purdue Univer-sity, last week at the WILL AM 580 ag outlookmeeting in Covington, Ind., projected U.S.farmers this year will feed a half percent more

animals than they did a year ago.“I’ve never seen a time when the world was

so competitive for the resources we have on ourfarms,” said Hurt, who joined the Purdue AgEconomics Department in 1981. “Foreign buy-ers have really found U.S. meat.”

U.S. meat exports the past five years havedoubled for beef and increased by 60 percentfor pork and 25 percent for poultry, the econo-mist reported.

This year Hurt projected exports of porkand broilers could increase 22 percent and 19percent, respectively.

The jump in meat exports is projected tomore than offset the fact that Americans areeating less meat. The per capita consumption ofmeat in the U.S. since 2006 has declined from222 pounds to 198 pounds.

“Much higher prices at the retail level causedconsumers to cut back,” Hurt said. “We’re see-ing smaller portion sizes and substitution.”

Higher meatprices are theresult of a majorreduction of theU.S. livestock herdin recent yearsdue in part tosurging feed costs.

Hurt said thelivestock indus-try has adjusted

to the situation and, with higher meat prices, itcan afford to feed corn at prices as high as $6and $7 a bushel. Livestock producers also feedthe equivalent of 900 million bushels of cornvia the ethanol byproduct distillers grains.

“The animal industry has gone through enor-mous adjustments,” the economist said. “Live-stock is fully competitive now with the ethanolindustry.”

Hurt believes current feed projections forthis year could be low, which would continue tobe friendly for old-crop corn prices. — DanielGrant

‘I’ve never seen a time when theworld was so competitive for theresources we have on our farms.’

— Chris HurtPurdue University ag economist

‘ I n t e n t i o n s t op lan t co r n a rebig. I t could be95 mi l l ion-p lus(acres).’

— Dan ZwickerADM Grain Group

PROFITABILITY

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AgriVisor LLC is not liable for any damageswhich anyone may sustain by reason of inac-curacy or inadequacy of information providedherein, any error of judgment involving anyprojections, recommendations, or advice orany other act of omission.

CASH STRATEGISTCorn Strategy

ü2011 crop: Nearby cornfutures failed to overcome crit-ical resistance early last week.May futures will struggle tosustain gains in the $6.47-$6.53area. Make catch-up saleswhen May reaches $6.50. Salesshould have been pushed upanother 10 percent when Mayfutures closed below $6.40.

ü2012 crop: Use ralliesabove $5.60 on Decemberfutures to make catch-up sales.We could add another sale atany time; check the Hotline daily.

vFundamentals: TheUSDA supply/demand reportwas generally neutral towardcorn. 2011/2012 U.S. corn end-ing stocks were left unchangedat 801 million bushels. Thetrade was anticipating a smallreduction. Global endingsstocks also came in above tradeexpectations at 124.53 millionmetric tons (mmt). Attentionwill begin to shift toward thecritical USDA March plantingintentions report, and everyoneis expecting to see a significantincrease in corn acres. Talk ofChinese business continues tolurk in the background.

Soybean Strategyü2011 crop: Soybean

prices continue to move higherbut may be close to exhaustingupside potential. Old-cropprices will have little funda-mental support unless weatherbecomes an issue this summer.

ü2012 crop: Use rallies tomake catch-up sales. If itwasn’t so early, we’d be willingto sell more at these prices.

vFundamentals: TheUSDA supply/demand reportoffered little surprise as far assoybeans were concerned. The2011/2012 U.S. ending stockswere left unchanged at 275 mil-lion bushels. Global endingstocks were reduced to 57.3mmt, but that’s still far frombeing tight. The reduction wasa result of declines in the pro-duction forecasts for Braziland Argentina. Still, total sup-plies are easily big enough toget the world to our new cropthis fall. The reduction in theiroutput places more stress onthe need for the U.S. to pro-duce a large crop this summer.

Wheat Strategyü2011 crop: The short-

term trend appears to haveturned down. It will take aclose above $6.52 in Mayfutures to potentially turn ithigher again. Use rallies to$6.50 on Chicago May futuresto make catch-up sales. Thecarry in futures still pays forcommercial storage, makingspring hedge-to-arrive con-tracts the best tool, but don’tcarry inventories beyond April.

ü2012 crop: Use rallies to$6.65 on Chicago July futuresto make catch-up sales. Pro-ducers who sell 100 percent oftheir crop off the combinewill want to be aggressive inmaking sales on rallies. New-

crop sales stand at 35 percent.

vFundamentals: TheUSDA supply/demand reportoffered little support to thewheat market. USDA peggedglobal ending stocks for2011/2012 at 209.58 mmt,slightly below trade expecta-tions, but still historicallylarge. U.S. supplies were esti-mated at 825 million bushels,down 20 million from Febru-ary, but they are still near bur-densome to prices. Going for-ward, attention will shifttoward spring conditions, asboth the Northern and South-ern Plains have pockets ofdryness.

Cents per bu.

Storm clouds brewing in markets

Page 11 Monday, March 12, 2012 FarmWeek

to overcome the 62 percentretracement of the 2008 col-lapse last April.

The pattern that has beenunfolding on the index sincethat peak near 370 stillincludes one more move downbefore it might come to a con-clusion. If it would breakthough 290 in the process, itwould indicate an even morenegative picture might bedeveloping.

Meanwhile, the U.S. dollarcontinues to trend upward offthe 3-year low it had last April.Until that trend is broken, thedollar looks destined to moveinto the middle/high 80sagain.

The technical picture thatappears to be unfolding oncommodity indices is startingto hint that “storm clouds”may be building. And that cer-tainly is fitting with the chartwe have shown, the tradeweighted index of the U.S. dol-lar.

We’ve been somewhat con-cerned about how the largertrend for commodity pricesmight unfold since they failed

perspectives

FarmWeek Page 12 Monday, March 12, 2012

Today, a college footballplayer may just as likely get afacemask full of soy turf asnatural grass.

In the past five years, indus-trial uses of U.S. soy have

increased 50percent.

During thattime, manymajor collegeand profes-sional sportsprograms haveadopted a soy-based artificialturf over

labor-intensive grass or thepetroleum-based turfs of yes-teryear.

This is, in essence, how abiobased economy takesshape.

There are more than 3,000companies producing morethan 20,000 bio-productsmade from grasses, grains,oilseeds, and agriculturalwaste, rather than petroleum.The products are commonthings such as detergent, bedlinens, ink, fertilizer, and dis-posable cutlery.

These cutting-edge innova-tions will assist us in breakingour dependence on foreign oilwhile helping to build a newindustry of competitivelypriced, American-grown andmade products.

In fact,makingthese itemsemploysabout100,000Americans— many ofthem inrural com-munities —by fusing two important eco-nomic engines: agriculture andmanufacturing.

At USDA, we think there isincredible potential for thisindustry to grow, innovate, andcreate economic opportunity.So we have taken action toexpand markets for theseproducts.

One year ago, we created abiobased product label thatwill soon be featured on morethan 500 products you maybuy at a local grocery store orpharmacy (see graphic).

We hope the label, whichcontains the biobased contentpercentage (57), becomes apowerful image of Americaningenuity, much like ourUSDA organic label.

Ten years have passed sinceUSDA launched the organiclabel. Today, you see it onthousands of fruits, vegeta-

bles, meats, or other goods atthe local market, and morethan two-thirds of Americansbuy organic.

Biobased products mayhold even greater potential.

Recently, President Obamaannounced steps to encouragethe federal government to dra-matically increase our purchas-es of biobased products.

Biobased cleaning goodsand construction materialssuch as carpet pads and insula-tion are grown and made inAmerica, as are lubricants andpaints and oils and paintremovers used in aircraft,motor vehicles, and by the mil-itary.

As the federal governmentencourages use of these cost-competitive alternatives, it willmean more contracts forAmerican businesses and moreAmerican manufacturers creat-ing good, middle-class jobs.

Of course, these optionsexist thanks to the ability ofour farmers to drive many oth-er sectors of the economy,including manufacturing andtransportation.

Over several decades now,U.S. agriculture has becomethe second most-productivesector of our economy.

American farmers apply thelatest in technology, achieve anearly unparalleled level of

productivity, contribute to ahomegrown supply of renew-able energy, and are responsi-ble for one out of 12 jobs herein the United States.

Our farmers feed peoplearound the globe and yet stillproduce enough food to keepour grocery bills among thelowest in the world. In otherwords, no challenge is toogreat for America’s farmers.

As we lay the foundationfor an economy that is built tolast, this effort to establish abiobased economy will createmore middle-class jobs, driveinnovation, reduce ourdependence on foreign oil,and support incomes for farm-ers.

Scherrie Giamanco is state executivedirector of the Illinois Farm ServiceAgency. Her e-mail address isscherrie.giamanco@il.usda.gov.

SCHERRIEGIAMANCO

U.S. is moving toward a biobased economy

Your farm’s future depends on your voteAs spring arrives, it not only brings with it the promise of a new growing season, but

also the opportunity for you to make your voice heard in our electoral process.Your ability and constitutional right to engage in the primary election on March 20 as

well as the general election in November is critically important as we in agriculture dealwith some very significant issues facing our country and our industry during this calendaryear and beyond.

The new legislative districts on both the state and national levels present some uniqueopportunities as candidates find themselves in some highly contested primary races.

Your vote is very important when it comes to electing individuals who willrepresent our organization’s positions on a variety of issues that undoubtedlywill impact our future. Matters such as the writing of a new farm bill, secur-ing funding for our infrastructure needsand improvements, avoiding unneces-sary and costly regulations aroundthe environment, transporta-tion, and other business regu-lations — and maybe mostimportant of all, soundtax policy on both thestate and federal lev-els.

There are things in life that are certain,even beyond the fact that the ChicagoCubs will never win a worldchampionship, and one ofthose certainties is the payingof taxes!

Tax policy is, in my opinion, one of the mostcritical areas of legislation and policy that canpotentially impact us in agriculture in a verynegative way.

We have been fortunate to achieve success on somerecent legislation that affects both our federal and state estate taxmatters. Those victories were hard-fought battles in both Congress and the GeneralAssembly. Our success was achieved because certain elected officials went to bat for us!

Lest we think the battles are over, let me remind you that the federal estate tax exemption forlandowners of $5 million per spouse, indexed for inflation, at a 35 percent tax rate, is set toexpire at the end of this calendar year.

Renewal of this exemption in a successful manner will be determined by whom you put intoCongress in November, and that process begins March 20!

Sometimes these votes are difficult ones to make for a legislator. Case in point, the Illinois General Assembly’s vote just before Christmas last year on Senate

Bill 397. That bill provided some incentives and breaks for certain companies in Illinois and ithas been a highly criticized vote.

While one can argue the soundness of whether it properly addressed a strong business cli-mate in Illinois, it did do some very important things for our tax policy as it impacts agricul-ture.

Included in the legislation was an increase in the Illinois estate tax exemption for individualsfrom $2 million to $3.5 million this year and to $4 million next year and beyond.

Even beyond the estate tax issue was the fact that the bill extended the state sales tax breaksfor the renewable fuels industry through 2018 and created an independent board that willreform the way taxes are protested in Illinois.

Our opportunity to achieve this increased exemption was an extremely limited, rare oppor-tunity. Had it not been for the Illinois Farm Bureau members and staff leaning on legislatorsto support the bill, I seriously question its passage.

Plain and simple, legislators supported our position because of your involvement, calls, andpast support. Some of those legislators need to know that you are still there on March 20 andin November! If they supported us, thank them and support them!

Tax policy will continue to be a one of several major issues that face us on the state andfederal levels. We need to know that we have people in office who will support our positions.

The first step is to vote March 20. Second, engage with the candidates on these tax issuesduring the campaign as we head toward November.

Last but not least, respond to our calls to action when they come later this year as the battlebegins to renew our federal estate tax exemption.

After all, all that is at stake is your family farm’s future!

Mark Gebhards is executive director of the Illinois Farm Bureau governmental affairs and commoditiesdivision. His e-mail address is gebhards@ilfb.org.

MARKGEBHARDS

Farm Bureau members will find in-formation related to the upcomingelection on the Illinois Farm Bureauwebsite {www.ilfb.org}. Look on the right side under the“Qu ick P i cks ” i con and c l i ck on

“Election information.” Vo t e r s a l s o may c a l l o r v i s i ttheir local election authorities withany quest ions, espec ia l l y thosewho don’ t have or use the In ter -net.

IFB offers members election information