Cash Market Moves

Mon. Jul 25, 2016 12:04 PM

By Mary Kennedy
DTN Cash Grains Analyst

"Bin-buster" will likely be the one word to describe the 2016 harvest. Starting with the winter wheat crop, yields so far have been reported to be anywhere from 50 bushels per acre to as high as 85 bpa or higher in some areas. USDA recently revised its winter wheat yield estimate to 50.5 bpa, which would be a new all-time high vs. the final yield in 2015.

Tim Luken, manager at Oahe Grain in Onida, South Dakota, told me it didn't take long for his winter wheat bins at the elevator to fill up. Currently, he said, "Anything that is coming through the door at this time is cash and with bins being full in the country, cash is the only game in town at this time."

"Winter wheat yields in western South Dakota have been as good as expected," said Jerry Cope, who does the grain marketing for Dakota Mill & Grain, Inc. in Rapid City, South Dakota. "I am guessing our average is in the high 50s bpa. Harvest has outrun either total farm capacity or allotted capacity at farm bins. Grain delivered to the elevator has been contracted bushels, first, and excess over storage, second. In turn we have, or will be, shipping more. For now wheat is following soybean weather and corn's export demand and will either benefit on the cash side or suffer if freight values go higher."

Moving on to the 2016 corn crop, the most recent USDA estimate is that yields will be at 168 bpa vs. 2015 final at 168.4. However, many in the trade feel USDA will raise that estimate again for 2016, given the excellent shape reported for corn all summer. As of July 17, the corn crop was rated at 76% good to excellent vs. 69% the same time in 2015.

Here's the problem: 2015 corn is still left in the bins. In the June 30 USDA Grain Stocks report, 2.47 billion bushels of corn remained stored on farms. This means corn has to start moving in order to make room for all the 2016 crops, not just corn and winter wheat.

As far as the corn reported stored on farms in the June 30 report, some of that has moved from farm storage, but likely not enough to make a huge dent in the pile thanks to prices diving since June. On June 15, the DTN Cash Index was at $3.92; one week later on June 22, the cash index was 3.57; on July 1, the cash index was $3.23 and as of Friday, July 22, the cash average was at $3.06. As the price dropped, farmers ran away from the market. To make matters a little worse, freight costs are on the rise.

At the end of June, secondary shuttle (shuttles no longer needed) freight costs were at $50/$150 per car (over tariff costs) for July, August was at $0/100 per car, September was at $0/$200 per car and October-December was at $450/$650 per car. On July 19, freight was quoted at $700/$900 for the rest of July split, August was at $400, September was at $300/$750, October was at $1,000/$2000 per car and full October, November, December was at $550/$750 per car.

To put it in perspective, the shuttle tariff rate per car (plus fuel mileage) cost for corn delivered from Minneapolis to Portland, Oregon, is about $1.24 per car. If you want to buy shuttle cars in the secondary freight market for new crop, the added cost on top of the tariff cost is about 50 cents per bushel and that cost, in the end, may end up cutting into the price paid to a farmer; not a good thing given how much the cash corn price has dropped in the past two months.

New-crop shuttle freight costs are obviously on the rise given the expectations for a very large corn new crop along with soybeans and wheat new crop that will have to ship. Nearby costs have been moving higher due to demand and also because shuttles are not moving quickly enough to destination and back again to be reloaded. A shuttle loader in eastern North Dakota told me he has three shuttles to move in the next few weeks, but "shuttles have slowed down causing delays." The BNSF considers "normal" trips per month for shuttles delivered to the PNW at 2.5 TPM (turns per month). In their weekly rail service update, the BNSF reported that for the week ending July 16, shuttle TPM were at 3.0.

Dakota Mill and Grain, which is serviced by the Rapid City, Pierre & Eastern Railroad (RCPE), doesn't have a secondary freight market but is affected by other railroads that do, as well as rising barge freight. "We watch BN freight and notice bids are strong through the end of the year," Cope told DTN. "You are right, nearby freight values have jumped. From what we hear, there is fall demand and indications of a strong corn export program that will keep shuttle resale values well supported. We don't follow barge freight as close, but it is reasonable that stronger rail demand creates barge demand. The railroads are leaving the door open for rate increases after November and if they follow their usual pattern, would not be surprised to see an attempt for $200-plus per car (5 -- 6 cents per bushel)."

Barge freight on the Mississippi River and its tributaries reached all-time highs in the past month. USDA in its June 23 Grain Transportation report said, "Current grain barge rates have increased to the highest levels since November 2015, based on increased demand from higher shipments. As of June 21, St. Louis to New Orleans grain barge rates were 300 percent of tariff ($11.97 per ton), a 40% increase compared to last week, and 18% above the five-year average. Rates at other major barge origins had 25% to 51% weekly increases and were 10% to 27% above the three-year average. The largest weekly increase for export-barged grain was at origins on the Ohio River. Corn shipments have been up as the last four weeks of corn inspections at the Mississippi Gulf were 120% of last year and 151% of the three-year average. Continued concerns over tight corn supplies in South America, especially Brazil, may be driving the current increase in corn exports and may be causing the higher barge rates."

Since that report, costs have come down some, but remain well above average for this time of year. For example, barge freight on the Illinois River for the week ending July 19 was 9% higher than last week, 12% higher than last year at this time and 27% higher than the three-year average.

A northeast Illinois grain merchant told me that he has quite a bit of corn to move to be shipped to the Gulf via the Illinois River. He agreed that high freight costs are not a good thing for the farmer with the lower prices we are currently seeing. He added that he has heard talk of bulk ocean vessel freight moving higher as well.

That means that the piece of pie going to the farmer will just keep getting smaller.

Mary Kennedy can be reached at

Follow Mary Kennedy on Twitter @MaryCKenn


Fire From the Sky

Fri. Jul 22, 2016 11:38 AM

By Cheryl Anderson
DTN Staff Reporter

OMAHA (DTN) -- Ranchers who use prescribed burns to control invasive plant species on their pastures could soon receive some help from above.

Researchers at the University of Nebraska-Lincoln have developed a prototype unmanned aerial vehicle -- commonly called a drone -- capable of safely igniting prescribed burns.

Developed at UNL's Nebraska Intelligent Mobile Unmanned Systems (NIMBUS) lab, the six-rotor AscTec "micro-drone" is only about 1 square foot in size, capable of fitting into a backpack. The drone has various layers of sensors, systems and software which enable an operator to very precisely and safely ignite a prescribed burn, according to Sebastian Elbaum, professor of computer science and engineering at the University of Nebraska-Lincoln.

Elbaum and Carrick Detweiler, assistant professor of computer science and engineering, designed the prototype for the drone.


The drone carries small balls that contain a chemical powder. Just before dropping the ball, the drone injects a second chemical into the ball and it bursts into flames within 60 seconds. The drone is capable of dropping the fireballs every few seconds, Elbaum said.

The UNL team has four prototypes of the drone, each carrying different sensors, a different number of fireballs and even different types of balls. While the current vehicles carry anywhere between 15 and 75 balls, the next prototype may be able to carry twice as many.

As the balls ignite, fire begins to emerge. Since the drone is a robot of sorts, users can plan very precisely where they want the fireballs to land.

"You can program where they are going to fall, or you can specify patterns where you want them to fall every 'x' number of feet over an area," Elbaum said. "You can actually tell them to go in a line or circle. You can specify all kinds of fire patterns that would be hard to do with a person."

Another benefit of the drones is that they can fly very low, so the balls are not blown away by wind gusts. The current prototypes are capable of flying in winds up to 15 miles per hour, but with prescribed fires manned by people, the winds are usually only up to 10 mph in Nebraska.

Currently, most people doing prescribed fires in small- and medium-sized areas are using tools such as torches, which haven't changed in the last 20 to 30 years, he said. Cars and all-terrain vehicles are also commonly used, which work well when there are roads or paths to navigate, but become more dangerous in rugged terrain such as ravines or canyons.

"That's where we think these micro-drones can come in. They can actually reach hard areas and cover them fast," Elbaum said. "They can get to a target location and initiate fires in a very controlled and targeted manner."


Earlier this spring, the NIMBUS team tested their drones to ignite a prescribed burn of more than 2,000 acres of private land in a loess canyon area near Gothenburg, Nebraska, in the south-central area of the state.

The goal of the burn was to target the red cedars that are considered an invasive species and are a problem because they consume a lot of water and take up a lot of pasture space, Elbaum said.

Then, in April, the NIMBUS team used the drone to burn 26 acres of restored tallgrass prairie at the Homestead National Monument of America near Beatrice, Nebraska, where a third of the prairie grass is burned every year for soil health and to control invasive species.

"It was a great test," Elbaum said. "We were able to work with firefighters, learn about how the technology performed, learn what the firefighters liked and didn't like, which helped us learn what aspects of the technology were limiting.

Other collaborators in the Homestead prescribed burn included the National Park Service's Midwest Region Fire and Aviation Program, the Service's national-level Branch of Aviation; and the Department of the Interior's Office of Aviation Services.

The Federal Aviation Administration gave permission for the test after the device was reviewed and approved by the National Aeronautics and Space Administration, which oversees air transportation research as well as space research.


After analyzing data from the Homestead burn, Elbaum said one of the interesting things the team learned was fire vectors and temperature information. This will help them to assign paths that are safer to navigate and gave them a better idea of the efficiency of the vehicle and the success rates of the initiated fires.

Since the tests, the team has been contacted by other parks interested in doing prescribed burns with drones, as well as ranchers in Nebraska and Kansas, and people in Michigan, Georgia and Arkansas, to name a few.

The drones could also be used to combat wildfires.

The NIMBUS team is talking to the Department of the Interior and private organizations to try to work with them in a more systematic way for conducting trials and to help them learn how to develop the technology to better match current needs, Elbaum said.

He summed up the team mission in three goals: to push the technology as far as possible to solve large problems, to help students become educated in the design and use of complex systems, and to perform outreach to help people doing this type of activity in the field.


Firemen or others using the drones will need to be trained, though the main goal of the team at UNL is to minimize the amount of training that is needed by programming the vehicle to operate on autopilot most of the time.

The Federal Aviation Administration requires even small drones to be registered, but since the NIMBUS engineers are not recreational users and are not doing things with drones that recreational users do, they needed a special Certificate of Authorization from the FAA to conduct their tests.

Elbaum said the laws for drone registration and usage are changing rapidly and may become more streamlined and straightforward in the future.

Other members of the NIMBUS team who helped develop the drone were Craig Allen, UNL professor and expert on invasive species management and sustainability; Dirac Twidwell, UNL rangeland expert who studies prescribed burns; Brittany Duncan, assistant professor of computer science and engineering; and students James Higgins, Evan Beachly, Christian Laney and Rebecca Horzewski.

Videos about the NIMBUS lab and its drone research are available here:… and…

Cheryl Anderson can be reached at

Follow Cheryl Anderson on Twitter @CherylADTN


DTN Distillers Grain Weekly Update

Fri. Jul 22, 2016 7:26 AM

By Cheryl Anderson
DTN Staff Reporter

Protein supplementation is important for spring-calving beef cattle grazing low-quality dormant forage, but altering the frequency of that supplementation may affect performance, especially in the last 28 days before calving.

Grazing low-quality dormant forage typically does not allow spring-calving beef cattle to meet their maintenance requirements for protein. The expansion of ethanol production has made distillers dried grains with solubles very popular as a protein supplemental feed.

A team of researchers from Kansas State University recently conducted research on the effects of altering supplementation frequency during the pre-partum period of beef cows grazing dormant native range, according to Justin Waggoner, associate professor and extension specialist for Kansas State University.

The trial expanded on an earlier 2014 KSU study on supplementation frequency of dried distillers grain, to see if DDGS could be fed as infrequently as once a week without affecting cow performance.

"One of the big questions our group has been interested in is: How do we better use distillers grains as a supplement?" Waggoner said.

In that earlier study, the researchers found supplementation frequency did not affect cow performance when DDGS was used. While analyzing the data, fellow researcher John Jaeger noticed some interesting changes in the last 28 days of gestation, so the two decided to see what would happen if, instead of keeping the supplementation frequency intact, they changed it 28 days before the expected calving date.

Waggoner said some operations will increase supplementation frequency as they get closer to calving. This makes delivery more efficient, since producers are out driving, looking for new calves anyway.

"With some producers making that change in going from an infrequent delivery to daily when getting close to calving, we wanted to see how the cows would respond to changing supplementation frequency from daily to every six days and from every six days to daily.

Another reason for the study, Waggoner said, is that producers are continually looking for ways to reduce operating costs and decreasing supplementation frequency may help reduce costs for labor and fuel involved in delivering the DDGS.

"The primary reason we were interested in evaluating the use of DDGS and supplementation frequency was to see if there were ways we could reduce those delivery costs associated with providing a supplement to a cow and increase our understanding of how DDGS may be used as supplement for the cow herd," Waggoner said.


The more recent study was titled "Effects of Altering Supplementation Frequency During the Pre-Partum Period of Beef Cows Grazing Dormant Native Range."

The trial involved pregnant Angus crossbred cows which were maintained on dormant native range for 88 days until the onset of calving. The cows were assigned randomly to one of four treatments:

1) Dried distiller's grains fed daily (D1).

2) Dried distiller's grains fed once every six days (D6).

3) Dried distiller's grains fed daily for the first 60 days and then once every six days for the remaining 28-day period (D1-D6).

4) Dried distiller's grains fed every six days for the first 60 days then daily for the remaining 28-day period (D6-D1).

The treatments were initiated 100 days prior to the expected onset of calving. Cow body weights and body condition scores were measured every 28 days. Cows that calved before the final weigh day were excluded from the analysis. A total of 232 observations were made in the trial.


The researchers found no differences between those cows supplemented with DDGS daily or those at six-day intervals.

Although the team hypothesized that increasing supplementation frequency from every six days to daily for the 28 days prior to calving would increase dry matter intake, resulting in greater nutrient intake and improved performance, they found increasing supplementation frequency had the opposite effect.

Cows in the D6-D1 group (supplemented every six days for the first 60 days, then daily for the remaining 28 days) had lighter body weights and lower body condition scores than cows in the other treatment groups.

Waggoner explained that when feeding less often, more supplement is delivered at a time. So instead of delivering two pounds of DDGS on a daily basis, a producer would be delivering 12 pounds of DDGS at one time in a feed bunk. Since the cows would likely eat more DDGS after delivered, that could, in effect, disrupt their grazing behavior and result in the lower intake of forage on the day the supplement is delivered.

Also a factor was the fact that cows are creatures of habit, he said.

"One of the things we learned was that as we supplement cows, they become accustomed to a feeding schedule and they get into a routine" he said. "What we did prior to calving was make a change in their routine."

[JW1] Waggoner said the take-home message from the trial is that it is important for producers to maintain their supplementation schedule for pregnant beef cows during the last 28 days of gestation.

"Whatever supplementation schedule you are on, it may in your best interest to maintain that through calving based on the results of this study," he said.

Other KSU researchers on the project were: C. J. McMullen, J. R. Jaeger, K. R. Harmoney and K C. Olson.

Cheryl Anderson can be reached at

Follow Cheryl Anderson on Twitter @CherylADTN



Chicken Council Lobbies for Ethanol Reduction

The National Chicken Council is asking for a reduction in the amount of ethanol produced in the U.S. in 2017, as well as a reassessment of the U.S. biofuel program as a whole, according to comments made by the NCC in response to the U.S. Environmental Protection Agency's proposed Renewable Fuel Standard for 2017 (…).

The EPA recommendation was to increase the RFS from 18.11 billion gallons in 2016 to 18.8 billion gallons in 2017. Those recommendations for 2017 are not just fuel market issues, the NCC argued. It said increased ethanol produces increases demand for corn, which impacts all corn users, especially poultry producers who do not benefit from the renewable identification numbers.

Distillers grains, that are used as feed for livestock, are not as valuable to broiler producers, especially with the growing trend of removing corn oil from distillers grains, the NCC said. Poultry producers value the oil as a source of energy in rations. Currently, 85% of all ethanol plants utilize oil extraction, according to the RFA.

The NCC argued that EPA needs to create a more sustainable approach to U.S. fuel policies, as current diversion of corn from feed to fuel uses "exacts a heavy toll on the domestic chicken industry and American consumers." Mike Brown, NCC president, said the proposed 2017 volumes are "overly aggressive and based on faulty assumptions about the fuel market and thus should be further reduced to limit the disruptions to the corn market and nation's feed supply.

Cheryl Anderson can be reached at



COMPANY STATE 7/22/2016 7/15/2016 CHANGE
Bartlett and Company, Kansas City, MO (816-753-6300)
Missouri Dry $155 $155 $0
Modified $67 $67 $0
CHS, Minneapolis, MN (800-769-1066)
Illinois Dry $140 $145 -$5
Indiana Dry $140 $145 -$5
Iowa Dry $130 $140 -$10
Michigan Dry $140 $150 -$10
Minnesota Dry $125 $125 $0
North Dakota Dry $120 $125 -$5
New York Dry $145 $150 -$5
South Dakota Dry $120 $120 $0
MGP Ingredients, Atchison, KS (800-255-0302 Ext. 5253)
Kansas Dry $130 $140 -$10
POET Nutrition, Sioux Falls, SD (888-327-8799)
Indiana Dry $150 $155 -$5
Iowa Dry $130 $130 $0
Michigan Dry $130 $140 -$10
Minnesota Dry $125 $125 $0
Missouri Dry $145 $145 $0
Ohio Dry $155 $160 -$5
South Dakota Dry $125 $130 -$5
United BioEnergy, Wichita, KS (316-616-3521)
Kansas Dry $127 $135 -$8
Wet $30 $40 -$10
Illinois Dry $150 $160 -$10
Nebraska Dry $127 $135 -$8
Wet $30 $40 -$10
U.S. Commodities, Minneapolis, MN (888-293-1640)
Illinois Dry $155 $155 $0
Indiana Dry $145 $145 $0
Iowa Dry $135 $135 $0
Michigan Dry $145 $150 -$5
Minnesota Dry $130 $130 $0
Nebraska Dry $115 $120 -$5
New York Dry $155 $155 $0
North Dakota Dry $125 $130 -$5
Ohio Dry $145 $145 $0
South Dakota Dry $115 $125 -$10
Wisconsin Dry $140 $140 $0
Valero Energy Corp., San Antonio, TX (402-727-5300)
Indiana Dry $145 $145 $0
Iowa Dry $130 $130 $0
Minnesota Dry $130 $130 $0
Nebraska Dry $125 $125 $0
Ohio Dry $150 $150 $0
South Dakota Dry $125 $125 $0
Western Milling, Goshen, California (559-302-1074)
California Dry $195 $198 -$3
*Prices listed per ton.
Weekly Average $135 $138 -$3
The weekly average prices above reflect only those companies DTN
collects spot prices from. States include: Missouri, Iowa, Nebraska,
Kansas, Illinois, Minnesota, North Dakota, South Dakota, Michigan,
Wisconsin and Indiana. Prices for Pennsylvania, New York and
California are not included in the averages.

*The spot prices gathered by DTN are only intended to reflect general market trends and may vary. Please contact individual plant or merchandiser for exact prices.

If you would be willing to take a weekly phone call and have your distiller grains spot prices listed in this feature, please contact Cheryl Anderson at (308) 224-1527 or (800) 369-7875, or e-mail


Settlement Price: Quote Date Bushel Short Ton
Corn 7/21/2016 $3.3425 $119.38
Soybean Meal 7/21/2016 $352.50
DDG Weekly Average Spot Price $135.00
DDG Value Relative to: 7/22 7/15 7/8
Corn 113.09% 106.67% 106.67%
Soybean Meal 38.30% 36.19% 36.19%
Cost Per Unit of Protein:
DDG $5.40 $5.52 $5.52
Soybean Meal $7.42 $8.03 $8.03
Corn and soybean prices taken from DTN Market Quotes. DDG
price represents the average spot price from Midwest
companies collected on Thursday afternoons. Soybean meal
cost per unit of protein is cost per ton divided by 47.5.
DDG cost per unit of protein is cost per ton divided by 25.




Dried Modified Wet
Iowa 120.00-149.00 49.00-70.00 34.00-40.00
Minnesota 125.00-145.00 55.00 33.00-45.00
Nebraska 115.00-150.00 54.00-66.00 30.00-45.00
South Dakota 120.00-140.00 60.00-68.00 37.00-40.00
Wisconsin 135.00-155.00 60.00-77.00 NQ
Eastern Corn Belt 126.00-160.00 66.00-75.00 NQ
Kansas 125.00-155.00 NQ 45.00-50.00
Northern Missouri 151.00-170.00 67.00 45.00-47.00
CIF NOLA 173.00-191.00
Pacific Northwest 184.00-196.00
California 183.00-193.00
Texas Border (metric ton) 200.00-216.00
Lethbridge AB n/a
Chicago 170.00-179.00

Dried Distillers Grain: 10% Moisture

Modified Wet Distillers: 50-55% Moisture

Wet Distillers Grains: 65-70% Moisture


Distillers Dry Grains

  Rail to California Points         190.00-192.00    unch-up 2.00
  FOB Truck to California Points    188.00-196.00    dn 2.00-9.00


Offers for Distillers Dried Grains delivered by rail to feed mills in the Pacific Northwest were 2.00 to 23.00 lower from 181.00-195.00. Offers for distillers dried grains trans-loaded onto trucks and delivered to Willamette Valley dairies were also 2.00 to 23.00 lower from


*All prices quoted per ton unless otherwise noted.



Dry and Wet Mill, Co-products and Products Produced - United States

April 2016 - May 2016

July 1, 2016


Dry mill co-product production of distillers dried grains with solubles (DDGS) was 1.84 million tons during May 2016, up 7 percent from April 2016 but down 1 percent from May 2015. Distillers wet grains (DWG) 65 percent or more moisture was 1.23 million tons in May 2016, down 2 percent from April 2016 and down 10 percent from May 2015.

Wet mill corn gluten feed production was 333 thousand tons during May 2016, up 9 percent from April 2016 but down 4 percent from May 2015. Wet corn gluten feed 40 to 60 percent moisture was 306 thousand tons in May 2016, up 2 percent from April 2016 but down 5 percent from May 2015.

Co-products and Products May 2015 Apr 2016 May 2016
Dry Mill tons
Condensed distillers solubles (CDS-syrup) 148,757 130,324 131,318
Corn oil 117,049 111,077 121,699
Distillers dried grains (DDG) 418,448 374,750 411,467
Distillers dried grains with solubles (DDGS) 1,861,795 1,717,024 1,842,182
Modified distillers wet grains (DWG) <65% moisture 1,368,926 1,264,745 1,234,315
Modified distillers wet grains (DWG) 40-64% moisture 414,956 429,972 425,532
Wet Mill
Corn germ meal 69,274 67,530 63,859
Corn gluten feed 348,355 306,464 332,975
Corn gluten meal 97,139 84,916 88,177
Corn oil 53,208 51,455 50,262
Wet corn gluten feed 40-60% moisture 323,436 301,283 306,424



National Organizations:

Distillers Grains Technology Council (

Renewable Fuels Association (

U.S. Grains Council (

National Corn Growers Association (

American Feed Industry Association (


National Grains and Feed Association (

Association of American Feed Control Officials (

USDA Animal Feed Safety System (…)

USDA Food Safety Modernization Act (…)

University Websites:

Corn Processing Coproducts Manual, Nebraska Corn Board and Nebraska Corn Board and the University of Nebraska-Lincoln Institute of Agriculture and Natural Resources Agricultural Research Division Cooperative Extension Division (…)

University of Minnesota Biofuels Coproducts in Animal Feed (



*Distillers Grains Technology Council Inc.'s 21th Annual Distillers Grains Symposium

The Distillers Grains Technology Council will hold its 21st Annual Distillers Grains Symposium on May 17-18, 2017 at the downtown Marriott in Indianapolis, IN. For information, contact the DGTC office at (515) 294-4019 or (800) 759-3448, or check the DGTC website (

(If you are sponsoring or know of any event, conference or workshop on distillers grains, and would like to list it in the DTN Weekly Distillers Grains Update, please contact Cheryl Anderson (see contact info below).


We welcome any comments/suggestions for this feature. Please let us know what information is valuable to you that we could include in the Distillers Grains Weekly Update. Please feel free to contact Cheryl Anderson at (402) 364-2183, or e-mail


I deleted this section primarily because we did not evaluate grazing behavior so it is simply speculation which we science types don’t like to do

Copyright 2016 DTN/The Progressive Farmer. All rights reserved.

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Aggies Gather at RNC

Thu. Jul 21, 2016 3:04 PM

By Jerry Hagstrom
DTN Political Correspondent

CLEVELAND (DTN) -- A series of high-ranking Republicans on Wednesday urged farm leaders to be unified in supporting the Republican ticket this fall. But they barely mentioned the name of GOP presidential candidate Donald Trump, leaving the pitch for him to a Nebraska farmer and agribusiness executive who will chair Trump's farm and rural committee.

Representatives of most of the nation's major farm groups and agribusiness firms attended the Great American Farm Luncheon, a Republican National Convention tradition.

Florida Agriculture Commissioner Adam Putnam; House Agriculture Committee Chairman Michael Conaway, R-Texas; Senate Agriculture Committee Chairman Pat Roberts, R-Kan.; and Sen. Rob Portman, R-Ohio, all urged attendees to vote Republican, but they either did not mention Trump's name or only in passing. House Agriculture Appropriations Subcommittee Chairman Robert Aderholt, R-Ala., and other current and past members of Congress were also present, but they did not speak.

Ted McKinney, the Indiana agriculture director appointed by Trump's running mate, Indiana Gov. Mike Pence, also spoke. McKinney said Pence "has a sense of our culture. He gets the hard part of agriculture."

If Trump and Pence are elected, McKinney said, "American agriculture will be at the fore. It will not be forgotten." Pence has held a governors' conference on agriculture and convinced the FFA (formerly the Future Farmers of America) to bring its annual convention to Indianapolis for at least nine years.

The Trump pitch was left to Charles Herbster, president and CEO of the Conklin Company and Herbster Angus Farms in Falls City, Nebraska.

"We need to be passionate about this next election," said Herbster, who was a candidate for governor of Nebraska in 2013, but dropped out due to his wife's illness. His biography says he has a mission "to bring God back into the corporate boardroom."

Herbster said he is putting together a farm, ranch and rural group for Trump with the assistance of Sam Clovis, a professor at Morningside College in Sioux City, Iowa, who became associated with the Trump campaign in 2015 after leaving the presidential campaign of Texas Republican Gov. Rick Perry, who dropped out. Herbster told DTN after the event that a farm and rural advisory board will be announced in about two weeks.

Herbster, who said his speech was written by Clovis, said he "knows" that Trump understands that food security is national security. Trump also will immediately address elimination of the "death tax," the term preferred by Republicans for the estate tax. Trump also understands "we have to revitalize rural America," and will bring "common sense" to land management in the western states.

Herbster also maintained that Trump is a supporter of free trade. Herbster said, "believes in trade just as much as anyone in the room," but believes the United States needs better-negotiated trade agreements because "we keep coming up on the short end of the stick" and this "is not good for manufacturing."

Herbster, who has previously told the media he has known Trump for 10 years, said he has visited New York three times in the last five weeks on campaign business. Herbster added, "Hillary Clinton is not an option for president."

Herbster told the attendees, "Donald Trump may have been your tenth pick" in the primaries, but the possibility that Clinton would make appointments to the Supreme Court should motivate them to support Trump now.

CropLife America President and CEO Jay Vroom was the master of ceremonies but noted that National Council of Farmer Co-operatives President and CEO Charles Conner, a former Agriculture deputy secretary, was his co-chair.

Vroom established the second theme of the event by telling the attendees that they must "stop talking to ourselves" and "dedicate ourselves to communicating" with the broader society.

Throughout the event, there were references to the difficulty convincing urban consumers and college students of the value of commercial-scale agriculture. David Daniels, director of the Ohio Agriculture Department, an appointee of Ohio Republican Gov. John Kasich, noted that he has to communicate with "people who live in a loft" and "have never been on a farm" and have a nostalgia for old-style farming.

Ohio Farm Bureau Executive Vice President Adam Sharp said Ohio has 14 million acres of farm land and 11 million people, which means farmers need to raise crops and animals in close proximity to urbanites. That proximity makes it particularly difficult to raise pigs on a commercial scale, Sharp noted.

Putnam, who is often mentioned as a candidate for governor, made the most impassioned speech in favor of voting Republican. Putnam said farmers' biggest threat today is not the weather but the Environmental Protection Agency, the Army Corps of Engineers, the Internal Revenue Service and the Labor Department.

"Hillary Clinton won't fix them," Putnam said. "The biggest obstacle to [agriculture] is our federal government."

The people attending the luncheon need "to support people up and down the ballot," Putnam said. The farm states will be battleground states, Putnam said, adding "even my state to a degree." (Polls show Clinton as much as nine points ahead of Trump in Florida.)

Putnam did not mention Trump, but said, "It doesn't matter who your pick was in the primary."

Of Pence, Putnam said, "Pence is our people."

Putnam also expressed frustration with the larger political atmosphere for agriculture. Putnam said he fears that Norman Borlaug, the plant breeder who developed the Green Revolution that increased agricultural productivity in India, would not be able to carry out his research at land grant colleges if he were alive today. Leftists, Putnam said, have forged "an unholy alliance" with people who usually support agriculture, including conservationists. Putnam urged the attendees not to allow opponents of large-scale agriculture to "pick the industry apart one commodity at a time" -- a statement that could be a reference to cane sugar farmers in his own state who advertise that their products are not genetically modified.

In order to feed a growing world population, Putnam said, agriculture "can't be Old MacDonald's farm."


Sorghum Pest Alert

Thu. Jul 21, 2016 2:18 PM

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- Sorghum pests never gave Jerry Martin many headaches before last year.

Now for the second year in a row, the central Kansas farmer is bracing for infestations of the sugarcane aphid. After a slow start in Texas this year, the pest has moved north and east earlier than ever.

In Kentucky, aphids were spotted in mid-July, a month earlier than 2015. Now, three hours south of Martin's farmland near Manhattan, Kansas, the pest has been found in sorghum fields in southern Kansas 10 days earlier than last year.

The levels of infestation in those Kansas fields suggest the pest has been calling the Sunflower State home for nearly a month already, according to a report compiled by Kansas State University's field crop Extension entomology team.

"Aphid densities are well below threshold, but those with sorghum fields are encouraged to scout fields now," the team wrote.

Because they reproduce asexually, aphid populations can grow rapidly and infest fields in a matter of days.

"Sugarcane aphids have caused yield losses of 30% to 100% for sorghum growers since 2013 in many states of the U.S.," warned University of Kentucky entomologist Raul Villanueva, in a university pest alert. "Sugarcane aphids affected severely grain and sweet sorghum fields last year in Georgia, South Carolina, Missouri, Tennessee, and Kentucky."

Last year, Martin sprayed his fields in early August and still experienced yield losses when aphid-damaged plants toppled over before harvest. "We still had very good yields, but we would have had fantastic yields if so much of it hadn't gone down," he said.

The aphids are piercing insects -- they suck fluids from the plant and leave behind a sticky honeydew that encourages the growth of a sooty black fungus. The plant damage lowers yield potential and the honeydew can clog and damage combines and field equipment.

Scouting can be tedious and thresholds for treatment vary by region. Villanueva recommends selecting 10 plants by random within a 50-foot stretch of the field. Examine a top and bottom leaf from each plant, looking for the tiny, light-colored aphids and counting those you find.

After repeating this process four to five times, count the average aphid counts per leaf. "If this average is between 30 to 135 aphids per leaf up to boot stage of development, then make an insecticide application," Villanueva concluded.

Growers on the High Plains should follow this slightly more conservative threshold:….

For more details on how to weigh the cost and potential benefits of spraying, see this guide from Texas A&M:….

Growers have two options for effective treatments this year: Bayer's Sivanto Prime insecticide and Dow's Transform insecticide, which has received Section 18 emergency use approvals for sorghum fields in 14 states (Alabama, Arkansas, Georgia, Kansas, Louisiana, Mississippi, Missouri, North Carolina, Nebraska, Oklahoma, South Carolina, Tennessee, Texas and Virginia). You can find those labels here:….

The EPA also just issued a Section 18 emergency use approval for Bayer's Sivanto Prime in sweet sorghum in North Carolina. You can see that label here:….

You can find the Kansas State University sugarcane aphid alert here:…, and Villanueva's update from Kentucky here:….

Emily Unglesbee can be reached at

Follow Emily Unglesbee on Twitter @Emily_Unglesbee.


WOTUS Pitfalls Loom

Thu. Jul 21, 2016 7:13 AM

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) -- As the waters of the United States rule remains tied up in federal court, a Houston-based attorney who handles Clean Water Act cases said Wednesday farmers should remain vigilant about whether work they do on the land is exempt from the law.

Sharon Marie Mattox, an attorney with Mattox Law Firm, said during a webinar she was unwilling to look into the crystal ball on how the legal battle will play out.

Some 30 states and many agriculture and other industry groups have sued the U.S. Environmental Protection Agency in federal court, claiming the new rule represents an unconstitutional expansion of power in the Clean Water Act. Though there are questions about which court has jurisdiction in the cases, the U.S. Circuit Court of Appeals for the Sixth District in Cincinnati has ruled it has jurisdiction to hear the case, likely to extend on into 2017.

The legal battles will continue for years to come, Mattox said, even if a federal court renders a decision one way or another on a large national lawsuit involving many states and industries against the rule.

"We will have years and years of fight based on the Commerce Clause (to the U.S. Constitution)," she said. "We have a huge regulatory program with high costs to comply. But it is ill-defined and there are not enough federal resources to apply it fairly.

"One of the fixes would be to pull this back to some easily determined federal jurisdiction."

Mattox said there are a number of issues farmers and ranchers should consider when it comes to Clean Water Act considerations on the land.

Juries who hear CWA cases, she said, often consider "good faith" efforts made by landowners to be in compliance with the law.

In most CWA court cases, Mattox said, the U.S. Environmental Protection Agency takes a hard line when the question of whether property owners did everything they could to comply.

"When you settle, unless you roll over and put your paws in the air EPA will consider it in bad faith," she said.

Before farmers and ranchers conduct projects on the land where potential waters of the U.S. may be involved, Mattox said it is good to seek out advice from professional consultants. They can provide analyses on questions of significant nexus to navigable waters.

"The clients I have fear wetlands may be connected," she said. "If you can get two opinions (on a particular question of jurisdiction) at least you have a good-faith effort on file. Most federal courts would be receptive of good faith."

When faced with potential Clean Water Act violations, Mattox said it is important for landowners not to ignore the problem, seek experienced advice from consultants and request a hearing with the federal government. What's more, she said early settlements may be the best business decision.

Although many farmers are ranchers are reluctant to allow officials from EPA or the U.S. Army Corps of Engineers onto their property, Mattox said it would help to allow the agencies to have a site visit. In addition, if the government alleges a farmer has violated the CWA property owners should request copies of all evidence relied on by the government in bringing such allegations.

Mattox said landowners should file administrative appeals on their cases, as it typically takes only 90 days to resolve.

Mattox said in many cases brought against farmers and other landowners where settlements have been reached, EPA and the Corps of Engineers often are "unwilling to tell you exactly what they want because they are willing to sue you for everything."

In cases involving settlement, she said EPA officials often closely monitor work done to bring land into compliance.

"You can reach a situation where settlement is impossible because EPA always is asking for more," Mattox said.

Most regulatory activity involving farmers and ranchers comes, Mattox said, based on questions of agriculture exemptions. One recent area of concern, she said, is in Section 404 of the CWA dealing with a recapture provision. This section deals with bringing land previously in agriculture production, back into production.

Usually problems start, Mattox said, when EPA or the Corps of Engineers bring enforcement actions against property owners. Those usually are brought on as a result of citizen lawsuits, when property owners ask for verification of ag exemptions on their land, or if when landowners ask questions about existing CWA permits.

Complaints typically are lodged by neighbors, competitors or non-governmental organizations (NGOs), Mattox said.

"The rigor of enforcement often is determined by a landowner's proximity to regulatory offices," she said, "and proximity to activity in a public setting."

Todd Neeley can be reached at

Follow him on Twitter @toddneeleyDTN


Rust Alert

Wed. Jul 20, 2016 2:06 PM

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- Southern corn rust is working its way north earlier than ever this year. Late-planted corn will be most at risk for yield losses from this fast-moving pathogen, plant pathologists told DTN.

"Rust diseases produce so many spores and have such a quick turnaround in the disease cycle that they always have the potential to blow up," explained University of Kentucky plant pathologist Carl Bradley. "It will be really important for people to scout if their corn is prior to R3 [milk stage] and especially if it is silking."

The disease has pushed the geographic limits of its name in the past few years. It overwinters in the tropics and depends on storms to move it northward into the southern states. Last year it reached Georgia in early June, was in Kansas by the end of the month, and by August it was racing through corn fields as far north as Illinois, Indiana, Missouri and Nebraska.

This year, the disease set a record early arrival date of June 1 in Georgia. It has now surfaced in Kentucky, and Kansas plant pathologist Doug Jardine recently spotted it the corn fields of southeast Kansas.

Southern corn rust thrives in tropical conditions -- high relative humidity and high temperatures.

"Weather conditions this season have certainly helped the rust problem to form," said DTN Senior Ag Meteorologist Bryce Anderson. "In contrast to the past two seasons, 2016 has been very warm, and this has been great for the rust development. Add to it the frequency of rain that we saw during June and early July, and the opportunity is there for rust to thrive and move."

With a heat wave descending upon the Midwest and Deep South this week, the disease is likely to spread quickly, Jardine and Bradley said.

Corn fields that were delayed due to a wet spring are most at risk, they said. Growers whose corn is silking or in the milk stages should scout carefully and consider fungicide treatment if they find the disease in their fields.

Left untreated, corn can suffer serious yield losses even with a midsummer arrival of the disease, Jardine said. Last year, corn test plots planted in late April in southeast Kansas lost 10% of their yield on average to the disease, he said.

Southern fields can lose 25 bushels per acre when susceptible hybrids aren't treated, according to a Purdue disease guide.

The disease's symptoms, orange pustules, may be confused with common rust, Jardine said. Common rust prefers cooler temperatures.

Southern corn rust pustules are smaller and lighter colored than common rust. The yellow-orange spores move readily -- a light-colored shirt can quickly turn orange in an infected field, Jardine added. Southern rust also tends to appear on the top side of the corn leaves only, unless the disease presence is especially heavy.

There aren't published thresholds for southern corn rust because the disease moves so quickly, Bradley said. If you find the disease in a field at or before the milk stages and conditions are right for further disease development, spraying would be wise, he said.

Even cornfields entering hard dough could benefit from treatment if the southern rust is bad enough, Jardine said.

Most hybrids are pretty susceptible to the disease, although that isn't always noted in seed descriptions, Jardine and Bradley noted. Bradley recommended calling your seed supplier to check on your hybrids' resistance ratings.

For a Midwestern perspective on finding and managing the disease, see this Purdue guide:….

Emily Unglesbee can be reached at

Follow Emily Unglesbee on Twitter @Emily_Unglesbee.


DTN Retail Fertilizer Trends

Wed. Jul 20, 2016 11:19 AM

By Russ Quinn
DTN Staff Reporter

OMAHA (DTN) -- Retail fertilizer prices tracked by DTN for the second week of July 2016 show prices are lower but not by significant amounts. However, DTN's last five weekly surveys have all reported price reductions.

In the latest retail survey, all eight of the major fertilizers dropped slightly in price compared to the previous month. DAP averaged $467/ton, MAP $496/ton, potash $358/ton and urea at $360/ton. 10-34-0 was at $538/ton, anhydrous $547/ton, UAN28 $266/ton and $306/ton.

On a price per pound of nitrogen basis, the average urea price was at $0.39/lb.N, anhydrous $0.33/lb.N, UAN28 $0.48/lb.N and UAN32 $0.48/lb.N.

In a July 11 blog post, David Widmar, agricultural economist at Purdue University, notes that except for fertilizer, variable crop production costs for corn have been slow to move. He previously examined if fixed costs were seeing adjustments.

Widmar pointed out that the average total cost of corn production in 2015 was $677 per acre or about $13 per less than in 2014, using data from USDA. This represents a mere 2% decline in total costs.

"Among variable costs, fertilizer was down $11 per acre in 2015," Widmar wrote. "Overall, fertilizer was a significant driver in lower corn production costs in 2015 as it accounted for half of the total variable cost reduction."

Widmar points out that other variable costs, such as seed and ag chemicals, have changed very little in 2015. Both were within $1 per acre of 2014 levels.

Data from Purdue corn budgets from 2014 to 2016 also document the fall in retail fertilizer costs. Fertilizer expense alone fell $21 per acre by 2016 and accounted for two thirds of the total variable expensive reductions over this period. The drop in fertilizer prices has been a critical component to adjustments to lower costs of production, he wrote.

Looking ahead to the 2017 growing season, Widmar believes it is difficult to imagine that fertilizer prices will continue to provide such a large cost savings.

"The combination of strong corn fertilizer demand in 2016 and stabilizing energy prices could set up the possibility of higher fertilizer prices in 2017," he wrote.

(To read Widmar's blog post, go to…).

DTN surveys show retail fertilizers remain significantly less expensive compared to a year earlier. All fertilizers are now double digits lower.

UAN32 is 15% lower, both MAP and 10-34-0 are 16% lower while both DAP and UAN28 are 18% less expensive. Anhydrous is 21% lower, urea is 23% less expensive and potash is 27% less expensive compared to last year at this time.

DTN collects roughly 1,700 retail fertilizer bids from 310 retailer locations weekly. Not all fertilizer prices change each week. Prices are subject to change at any time.

DTN Pro Grains subscribers can find current retail fertilizer price in the DTN Fertilizer Index on the Fertilizer page under Farm Business.

Retail fertilizer charts dating back to November 2008 are available in the DTN fertilizer segment. The charts included cost of N/lb., DAP, MAP, potash, urea, 10-34-0, anhydrous, UAN28 and UAN32.

DTN's average of retail fertilizer prices from a month earlier ($ per ton):

July 13-17 2015 569 593 488 470
Aug 10-14 2015 568 591 479 457
Sep 7-11 2015 563 580 467 433
Oct 5-9 2015 548 564 446 418
Nov 2-6 2015 546 560 430 405
Nov 30-Dec 4 2015 541 559 421 400
Dec 28-Jan 1 2016 494 531 398 383
Jan 25-29 2016 495 515 391 380
Feb 22-26 2016 477 492 373 371
Mar 21-25 2016 475 501 371 390
Apr 18-22 2016 477 502 366 388
May 16-20 2016 476 501 365 384
June 13-17 2016 469 496 359 367
July 11-15 2016 467 496 358 360
Date Range 10-34-0 ANHYD UAN28 UAN32
July 13-17 2015 639 691 323 359
Aug 10-14 2015 631 677 315 356
Sep 7-11 2015 594 656 301 346
Oct 5-9 2015 584 639 294 338
Nov 2-6 2015 583 633 291 332
Nov 30-Dec 4 2015 578 627 286 332
Dec 28-Jan 1 2016 570 590 273 317
Jan 25-29 2016 571 569 271 317
Feb 22-26 2016 566 536 260 309
Mar 21-25 2016 561 569 276 312
Apr 18-22 2016 561 588 274 322
May 16-20 2016 558 588 274 321
June 13-17 2016 555 566 266 305
July 11-15 2016 538 547 266 306

Russ Quinn can be reached at

Follow Russ Quinn on Twitter @RussQuinnDTN


Kub's Den

Wed. Jul 20, 2016 6:44 AM

By Elaine Kub
DTN Contributing Analyst

MUGWUMP (noun | mug·wump | \'m?g-w?mp\)

: a person who is independent (as in politics) or who remains undecided or neutral

Presidential elections are assumed to have some effect on the markets, or on the stock markets anyway, and during these two summer weeks of flag-waving convention furor, I thought I should examine the grain markets' relationship to elections, too. But first, I want to assure you that I myself am a mugwump. I'm no longer a Republican or Democrat (and I won't tell you which one I used to be), so I can't be accused of any political motivation in bringing up this topic. The Libertarians already had their convention back in May, and I promise I won't write any names starting with C or T or J in this column at all.

Okay, so the presidential election cycle as experienced by the stock markets goes like this: Stock prices tend to move lower during the first two years of a presidential term, then move higher during the last two years of a presidential term. Theoretically. It was described using three decades of data in a 1995 study published in the International Review of Economics & Finance* and has been confirmed off and on by various industry reports and other academic studies.** As one researcher summarized: "The presidential cycle effect prevails even after controlling for the party in power and the incumbent versus nonincumbent presidents."

And yet. It has rarely worked in the past 10 years. During the first half of George W. Bush's second term (January 2005 to December 2006), the stock market didn't move lower as The Cycle would have predicted. The S&P 500 Index actually rose 16%. Again it failed to follow the pattern when it proceeded to move lower during the last half of his second term. Nor has the cycle worked well as a predictor during Obama's presidencies: The S&P 500 Index went up 33% from January 2009 to December 2010, the first half of his first term when, according to the presidential election cycle, it should have been falling. The stock market did obey the cycle during the last half of his first term. Then it failed again during the first half of his second term by rising again. We have yet to see if the S&P 500 Index will post a gain or a loss (above or below 2058.9) during the last half of his second term.

That is a potent demonstration of the dangers of using infrequent data sets to predict future outcomes. When one team of researchers considered market data from 1965 to 2003, that was only 9 1/2 cycles. If a statistician is trying to draw a decently legitimate trendline on any given chart, she typically wants at least 30 samples, as a rule of thumb. So these academic descriptions of a theoretical presidential election cycle simply don't have enough data behind them. But they can't really go back farther in time to get a robust number of samples because whatever the stock market was doing in 1880 when Winfield Scott Hancock was running against James A. Garfield, it just does not hold much wisdom for today's world of sovereign wealth funds and algorithmic traders.

Note that this is the same problem faced by political commentators trying to predict the actual outcome of an election (or a referendum, in the case of our friends across the pond) when there can never be any truly comparable samples of historical data to draw upon. It's unlikely there will ever be any set of two or three exactly comparable candidates facing an exactly comparable population with exactly comparable sentiments and economic situations.

We see that in the grain markets, too, when we analysts sometimes stretch too hard to say that the predicted La Nina weather in later 2016 might resemble the La Nina weather of 2010 (or whenever) and so maybe prices will do the same thing they did then. Sure, the weather might be comparable; the yield trend might be comparable; but the prices? I'm doubtful. Global economies are different now than they were then; outside markets are different; industrial usages are different; investor tendencies are different; lots of things are different. If we had a lot more crops facing a lot of different scenarios every year for a long series of years, we'd have a lot better chance at isolating or controlling for other variables, and then maybe we could be more confident when making cyclical prophecies.

Ultimately, do commodity markets (especially grains) behave according to a four-year presidential election cycle? Pretty much no. In Kub's Den columns from 2008 and 2012, I already demonstrated that grains didn't have a reliable presidential election cycle, even when the stock market did appear to (back before the last few presidential terms so blatantly broke the pattern). Commodities and stock markets used to have a reliably negative correlation -- when raw materials got expensive, corporate profits tended to suffer and vice versa -- but even that relationship has drastically changed in the last several years as huge investment funds have moved their money in and out of all asset classes at roughly the same times.

Let's hope that economic sentiment for the next several years will be driven less by which half of a presidential term we're in, and more by the policies that the government is enacting. In any case, there is something to be said for being a mugwump -- not about the election necessarily, but about grain prices themselves. If you remain as unconvinced by the bulls and bears as you do by the elephants and donkeys, then you should keep your marketing program flexible and always have the risk of a worst-case scenario covered.

Elaine Kub is the author of "Mastering the Grain Markets: How Profits Are Really Made" and can be reached at or on Twitter @elainekub.

*Gartner, M., & Wellershoff, K.W. (1995). Is there an election cycle in American stock returns? International Review of Economics & Finance, 4(4), 387-410.

**Wong, W.K., & McAleer, M. (2009). Mapping the Presidential Election Cycle in US stock markets. Mathematics and Computers in Simulation, 79(11), 3267-3277.


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