Groups React to TPP Deal

Tue. Oct 06, 2015 2:07 PM

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) -- Initial reaction to a Trans-Pacific Partnership deal was varied Monday as some agricultural groups acknowledged they need more details on the final pact while others already had their minds made up on whether they back TPP or oppose it.

The agreement between the U.S. and 11 other Pacific-rim countries was announced Monday after marathon talks over the weekend in Atlanta.

Reflecting the importance the White House sees in getting agriculture on its side in the TPP debate, President Barack Obama will go to the U.S. Department of Agriculture on Tuesday where he will join Ag Secretary Tom Vilsack for a meeting with agriculture and business leaders. The event is specifically to pitch the benefits of the trade deal.

U.S. Trade Ambassador Michael Froman pointed out Monday the deal eliminates tariffs on more than 18,000 U.S. products. The White House added that the "key tax cuts" in the trade deal would help American farmers and ranchers expand exports. The administration added those import taxes currently can be 40% on poultry products, 35% on soybeans and 40% on fruit.

Froman pointed to the benefits of the deal for agriculture for beef, pork and dairy.

"Our dairy industry has become a more export-oriented industry in the last 10 years," Froman said. "We export about 15% of our dairy products. This will open up additional opportunities in these other countries where they face tariff or non-tariff barriers."

The countries in the partnership account for 42% of all U.S. ag exports, totaling $63 billion, Vilsack said. The agreement "provides a more level playing field in trade for American farmers," he said. Besides reducing or eliminating tariffs, TPP also will reduce the likelihood of non-scientific trade barriers among the countries. The secretary cautioned against rejecting the deal.

"Failing to grasp this opportunity would be a mistake; worse than just losing out on potential gains, our producers would fall behind other countries that are negotiating their own preferential arrangements in TPP countries," Vilsack said. "We are committed to working with Congress within the framework of the recently-passed Trade Promotion Authority to obtain a strong bipartisan understanding of and support for this historic trade deal that benefits farmers, ranchers, and all those who live, work and raise families in rural communities."


U.S. Wheat Associates noted Asia is a growing regional market and the trade agreement has the potential to increase wheat demand even in countries already offering duty-free access, said Alan Tracy, president of the group. "That is critically important because our competitors like Australia are moving ahead with bilateral agreements that eliminate tariffs on wheat imports with countries like Vietnam. The high standards in the TPP agreement should help us be more competitive and hopefully lead to even more opportunity for our wheat as new countries join TPP in the future," Tracy said.

Groups such as the National Pork Producers Council and National Cattlemen's Beef Association immediately praised the deal. NPPC stated the group was confident the deal would be good for U.S. pork producers. "We look forward to reviewing the full text of the TPP agreement and the schedules of market access concessions as soon as possible," said Ron Prestage, president of the National Pork Producers Council. "We are reserving final judgment on the package until then."

The National Chicken Council also applauded the conclusion of talks and was looking forward to seeing how the deal will affect the prospects of exports to Canada. The TPP represents a significant opportunity to expand U.S. chicken exports and bring increased economic benefits to chicken farmers and companies across the country.

"Our major goals in this deal are to get a strong commitment on enforcement, in particular in the area of sanitary and phytosanitary measures," said Mike Brown, president of the National Chicken Council. "Second, we hope to see that the long-protected Canadian market is finally opened to free trade for poultry."

Chip Bowling, president of the National Corn Growers Association, stated the group was pleased an agreement has been reached and the group was looking forward to the details. "We are hopeful that this agreement continues the tradition of past free trade agreements, which have had a positive impact for America's farmers and ranchers," Bowling said. "In the coming weeks, we will carefully examine the agreement to determine whether it is in the best interests of America's corn farmers."


National Farmers Union, whose members have been long-time opponents of the deal, cited the lack of enforcement on currency manipulation as another strike against the trade pact. "Because of this, NFU will continue to vigorously oppose this agreement and urge Congress to reject this deal as well," said Roger Johnson, president of NFU. "Gains that may have been made in the agreement to ensure fairness and equity in trade for America's family farmers and ranchers are likely to be lost due to currency manipulation."

A more surprising statement came from Ford Motor Co., which also lashed out at negotiators for failing to address currency manipulation even though the deal is expected to lower tariffs for auto exports to Japan. Ford noted the trade-promotion bill set a clear objective of dealing with currency issues. "TPP fails to meet this test," stated Zia Ojakli, Ford's vice president for government and community relations. "To ensure the future competitiveness of American manufacturing, we recommend Congress not approve TPP in its current form, and we ask the administration to renegotiate TPP and incorporate strong and enforceable currency rules."

While the White House released a detailed fact sheet highlighting tariff reduction, labor and environmental rules, internet commerce and other provisions, the fact sheet did not address rules on currency.


Trade negotiators acknowledged Monday that dairy access proved to be one of the last issues negotiated. New Zealand, where dairy is the country's largest export, failed to get the market access it had hoped to achieve when New Zealand took the lead to help form the TPP. Fonterra, New Zealand's major dairy cooperative, stated the group was disappointed the TPP fell short of the original goals to eliminate all tariffs.

Dairy Farmers of Canada cited that Canada essentially gave up what amounts to 3.25% of its projected 2016 milk production in the trade deal. The country already has approved a $3.29 (U.S.) billion package to help Canadian dairy farmers deal with imports over the next 15 years. Still, Canada's dairy farmers largely protected their supply-management program.

"We obviously would have preferred that no additional market access be conceded in the dairy sector," said Wally Smith, president of Dairy Farmers of Canada. "However, we recognize that our government fought hard against other countries' demands, and have lessened the burden by announcing mitigation measures and what seems to be a fair compensation package, to minimize the impact on Canadian dairy farmers and make up for cutting growth in the domestic market. We have come a long way from the threat of eliminating supply management."


Health groups praised a provision that would prevent tobacco companies from suing countries over health laws meant to curb tobacco use. The groups have criticized tobacco companies in the past for claiming that tighter controls on tobacco use in some countries violate trade laws. House Ag Committee Chairman Michael Conaway, R-Texas, pointed to the tobacco provision in a statement Monday, saying the language is "establishing a dangerous new precedent that could negatively impact agriculture going forward."

Chris Clayton can be reached at

Follow him on Twitter @ChrisClaytonDTN


Todd's Take

Tue. Oct 06, 2015 1:52 PM

By Todd Hultman
DTN Analyst

It is no secret that grain prices have not done well in 2015, but neither have most other commodities. A quick survey shows corn, wheat, and gold near their lowest spot prices in five years; soybeans, cotton, sugar, copper, silver, and crude oil near their lowest spot prices in six years. Soybean oil rounds out the bottom of the list with the lowest spot price in nearly nine years.

Of course, each commodity has its own bearish story, but when so many are trading at multi-year lows, you have to suspect a strong macroeconomic influence at work and we certainly have that. In short, the U.S. economy has done a better job of rebounding after the financial meltdown of 2008-09 than other countries and the advantage has boosted the U.S. dollar to its highest level in 12 years.

At the same time, China's economic slowdown has not only slowed demand for raw materials and industrial metals, but has also had a dampening effect on the economies that supplied them. Finally, the U.S. has been so good at increasing oil production that it has broken oil prices and the budgets of many oil-producing countries.

The result is the world economy is currently straining to grow and deflation remains a bearish threat to commodity prices. As bearish as that sounds, the current malaise reminds me of another time when the case for commodities looked gloomy -- 2001.

In 2001, spot corn traded at roughly $2.00 a bushel, soybeans at $4.50, gold at $270 an ounce, copper at 70 cents a pound, and crude oil at $26 a barrel. Investors, for the most part, ignored commodities, choosing instead to ride the stock market's bullish wave of the late 1990s, powered by the collapse of the Berlin Wall and return to a federal budget surplus. Gold was so unpopular that European Central Banks agreed to limit sales, fearing they would collapse prices if too much sold at once.

Also hurting commodities, the Federal Reserve pushed the federal funds rate up to 6.5% in May 2000 as Chairman Alan Greenspan sensed the irrational exuberance of the dot-com bubble. A high interest rate plus the goodwill of a budget surplus drove the U.S. dollar index up to 120 by June 2001, the highest level in 15 years.

If we would have talked in mid-2001, I would have mentioned all kinds of reasons that commodities were cheap and explained that the macro teeter-totter had dropped them to their bottoms, but we couldn't have seen the bullish forces that were lying in wait.

Only later would we witness the World Trade Center come tumbling down on that clear fall day. We could then see the stock market slide lower and the Fed push the federal funds rate back down, eventually reaching 1% by mid-2003. Very quickly, the bullish argument for the U.S. dollar disappeared and, once again, commodities became a viable investment.

The rumblings of war certainly helped crude oil prices in 2002, but it was the waking giant of China that later boosted the prices of oil and many other commodities -- grains included -- farther than anyone ever expected.

This does not mean that today's depressed commodity market will bring on another 9/11 or bullish surprise as big as China. However, when we see nearly all commodities beat down to cheap levels, the market is often over-responding to the bearish news that it knows and is under-estimating the future events that none of us know.

As in 2001, the most bullish thing I can say is grain prices are fundamentally low and the bearish reasons are obvious. I don't know yet what will shake up the current outlook, but both the U.S. dollar and stock market are suspect. Bullish changes aren't on the radar screen yet, but we are watching.

Todd Hultman can be reached at

Follow Todd Hultman on Twitter @ToddHultman1


View From the Cab

Tue. Oct 06, 2015 12:23 PM

By Richard Oswald
DTN Special Correspondent

LANGDON, Mo. (DTN) -- "We didn't do anything yesterday. Just a rainy, misty, ucky kind of day." That's the way DTN View from the Cab Farmer Lane Robinson summed up the weekend at his farm outside Cromwell, Indiana. "Saturday felt like December ... It's almost unseasonably cold," he said.

Harvest around Lane's place began a couple of weeks ago. Neighbors had been working since then, until a brief spate of wetter weather brought combines to a halt. "I didn't see anything moving here. It's supposed to be a good week the next week and everybody'll keep marching along," he told DTN late Sunday.

After cutting "average" soybeans "in the mid-50s range" last week, Lane and his farming partner, Eric Strater, have dipped into corn with better results. "We popped into the first corn, a 150-acre pivot (irrigated) field with no drowned-out spots on sandy, loamy ground at Eric's home farm. It was 236 bushels per acre (corrected dry yield) at 21% moisture. We only made it half or two thirds of the way across the field. It will take a while to dry that," Lane said.

Local dryland corn has been reported yields of about 200 bpa. And corn is standing well -- so far. "Given the amount of moisture (rain), I don't think stalks are tremendously strong, but I haven't seen any corn down. There are some tops out of the stalks." Lane was asked if there was enough storage space to hold a big crop. He replied, "There's no corn going on the ground yet, but yield may be good enough that we will. But you don't have to go very far south, just one county below us, where you're going to find plenty of bin space. They just aren't going to have the crop."

With cool and wet spring planting delays, crops are all over the board depending on variety, maturity, and planting dates. "I actually have some 3.8 maturity soybeans that were planted May 5 that still have leaves on. Development is a little delayed." Despite that, harvest is moving along. "Everybody seems to be going at it, doing beans when they'll go. Most have moisture in the 11% to 12% moisture range. I haven't even heard of anybody who had to put air on them."

A marketing advisory service Lane subscribes to, Roach Ag Marketing, offers subscriber yield reports as an alternative to USDA estimates. "Roach has Indiana average corn yield at 173 bpa now, based on 83 reports. USDA is estimating 156. Roach is 17 bushels over USDA. In soybeans USDA has us at 50. Roach submissions have it at 51," he said.

"I'm looking for sales points for 2016 crop corn already. We're back in that area where you have that time decay -- the value is in time -- just like an option. March 2017 corn is looking attractive at $4.20," Lane explained.

Besides row crops, Lane raises more than 600,000 Pekin ducks in 10 barns each year. "We're loading out tonight. I only have one barn to ship this week," he said. When Lane purchased the existing facility, one of the changes he made was to shorten turnaround time in order to use it more efficiently.

"Our fiscal year ends November 30. We're going to end up with 83 flocks. When I first took operations over, we were on a seven- or eight-week cycle. Now we're in a pretty hard six-week cycle doing 17 turns per barn every two years." In Lane's three dirt-floor barns, used litter will "compost mortality" by being layered with deceased ducks, which kills pathogens by heating up to 150-200 degrees. The other seven barns with slatted floors will be cleaned and allowed to dry two or three days. Then brooders are placed inside and barn thermostats get set up to 80 degrees before replacement ducklings arrive.

"We don't just wait around," he said.

Meanwhile, outside Gurley in the Nebraska Panhandle, View From the Cab farmer Leon Kriesel had good news; "We got saved. We got a rain Friday night. We ended up at 0.78 inches. It was a lifesaver for the wheat I think," he told DTN late Sunday.

Leon grows and sells certified seed from about 3,000 acres. He has been concerned because absence of late-season rains left much of the winter wheat he seeded last month marooned in dry dirt. "Emergence has been spotty. I think a lot of people were really relieved. This will fill everything in. I'd say by the end of the week we'll see lots of wheat," he said.

Weather conditions at Leon's place Sunday evening were foggy and chilly. But with a typical first freeze date in September, frost still isn't a threat in weather forecasts, with more rain possible by midweek.

Some area growers are looking at the possibility of replanting thin wheat stands. With that in mind, Leon has been making preparations. "We had some reserves we kept back. There was some replant going on so we decided to clean that. We finished cleaning two varieties of what we had saved, last week. We'll clean another variety this week. We're happy with the rain, because now we can touch up the skips and get that done," he said.

Leon didn't plant any this year, but area corn harvest is off to a slow start. Irrigated fields picked last week tested around 30% moisture. "They should be happy with what they got. It looked good," he said. Dryland corn should be getting dry enough for harvest. Proso millet harvest was mostly complete before last week's rain. Sunflowers and milo need more time.

"There was some sugar beet harvest going in last week to get the plant up and running. They'll probably get started this week. They have a set date when they start picking," he said. Temperatures are an important component of beet harvest. "They pile the beets and cover them with straw. Some people think that's to keep them from freezing, but it's to keep them cool," Leon explained.

Winter isn't far off in Nebraska high country where Leon noted that the Sidney airport recorded a Sunday high temperature of 52 degrees.

"You had to wear a coat," he said.

Richard Oswald can be reached at

Follow Richard Oswald on Twitter @RRoswald


Soybean Export Inspections Bullish

Mon. Oct 05, 2015 3:05 PM

By Todd Hultman
DTN Analyst

OMAHA (DTN) -- Corn and wheat inspections were bearish, and soybean inspections were bullish in this week's export inspections report, according to DTN Analyst Todd Hultman.

Corn weekly export inspections were 18.5 mb (469,697 mt) for the week ending Thursday, Oct. 1. This is well below 35.0 mb for the same week a year ago. Inspections for 2015-16 total 126.8 million bushels, down 20% from the previous year and below USDA's projected demand decrease of 1%. Monday's report should be viewed as bearish, Hultman said.

Soybean weekly export inspections were 41.3 mb (1,122,669 mt) for the week ending Oct. 1. This is above 36.8 mb for the same week a year ago. Inspections for 2015-16 total 94.2 million bushels which is up 2% from the previous year and above USDA's projected demand decrease of 6%. Monday's report should be viewed as bullish, Hultman said.

Wheat weekly export inspections were 20.5 mb (557,109 mt) for the week ending Oct. 1. This is below 25.7 mb for the same week a year ago. Marketing year total inspections for 2015-16 of 295.0 mb are down 16% from the previous year, below USDA's projected demand increase of 5%. Monday's report should be viewed as bearish, Hultman said.

Todd Hultman can be reached at

Follow Todd Hultman on Twitter @ToddHultman1


Brazil Planting Edges Forward

Mon. Oct 05, 2015 2:23 PM

By Alastair Stewart
DTN South America Correspondent

SAO PAULO, Brazil (DTN) -- Rapid progress in the southern state of Parana allowed Brazilian soybean planting to move forward to 3% complete as of Friday, Oct.2. This is about on a par with the same stage last year and the five-year average, said AgRural, a local farm consultancy.

Excellent rains over the last couple of weeks emboldened farmers in Parana to start fieldwork shortly after the planting window opened. As a result, planting was 16% complete in that state as of Friday, up from 10% last week and beating the 8% recorded at the same stage last year, said the consultancy.

Those who planted in drier conditions in the west of the state were rewarded with rain last week.

Fieldwork remains slow in Mato Grosso, the No. 1 soybean state, where the early-season irregular rainfall so typical of El Nino years continues.

With margins tight, farmers in the Cerrado state are taking fewer risks and planting remains concentrated on fields that are irrigated.

As of Friday, planting was 2% complete in Mato Grosso compared to 5% at the same point last year, said AgRural.

Rainfall was restricted to sparse showers across the productive regions of the north, west and parts of the south of the state.

In Mato Grosso do Sul, soybean planting is 3% complete with the south receiving decent showers last week. In Goias, the planting window opened on Wednesday and 1% of fields were done as of Friday.

The good news for farmers in Mato Grosso and surrounding areas is that weather charts indicate more rain from Wednesday, with showers intensifying into next week, according to the Somar Meteorologia, a local weather service.

Areas in the west of Mato Grosso will get the best of the rain, explained Tiago Robles, a Somar weatherman.

The arrival of a cold front in southern Brazil will cause heavy rain to fall across Parana from Wednesday, which may impede fieldwork but will be generally beneficial to the crop.

Alastair Stewart can be reached at

Follow him on Twitter @AStewartBrazil


Food Security Challenges - 7

Mon. Oct 05, 2015 1:43 PM

By Bryce Anderson
DTN Senior Ag Meteorologist

OMAHA (DTN) -- Over the past several years during my presentations at farm shows and producer meetings, there's one topic during the question-and-answer session that brings the crowd to almost complete silence -- climate change.

Whatever a grower's position on the hotly debated issue, the effects of extreme and volatile weather are being felt firsthand by producers. These out-of-the-ordinary events create a sense of "something's going on." They command everyone's attention, so questions are being asked.

Something is indeed going on. In the past 15 years alone, the U.S. has experienced more than 150 weather events with damages of $1 billion or greater. In 2011 and 2012 alone, 25 severe storms, floods, drought, heat waves and wildfires resulted in $188 billion in losses.

Extreme weather continued in 2015, as sustained heavy rain and flooding resulted in several hundred million dollars of damaged crops in the Midwest, Texas and parts of the South. Meanwhile, historic drought in the western U.S. continues, forcing farmers and ranchers who irrigate to make agonizing decisions about which fields or crops get water and which ones don't.


What used to be called "extreme" events now seem to occur as a matter of course. The amount of rain falling in very heavy precipitation events (the heaviest 1% of all precipitation events) has increased during the last 50 years throughout the U.S., as well as in many other parts of the world. Gene Takle, director of the climate science program at Iowa State University, defines a heavy event as rainfall greater than 1.25 inches, because that's the amount that causes runoff.

Climate experts have also observed that snowfall, in general, is decreasing; mountain areas have rain more often than snow, reducing the amount of spring runoff so important to more than two-thirds of the western U.S. And, in the primary row-crop/small-grains regions, seasonal changes widely observed include earlier springs, longer frost-free periods, longer growing seasons and changes to animal, bird and insect habitat.

Behind this backdrop is a global climate that's steadily getting warmer. Not every year is going to be warmer than the previous year. Still, during the past 100 years, the Earth has warmed by an average of about 1.5 degrees Fahrenheit. Some regions surpass that average, especially the northern high latitudes, as well as land areas. Put another way, according to NASA, in the past century alone, the earth's temperature has climbed 0.7 degrees Celsius, roughly 10 times faster than the average rate of ice-age-recovery warming. For the U.S. as a whole, the first decade of the 21st century has seen twice as many record daily high temperatures as record daily low temperatures.


Behind the warming trend is human input. The American Meteorological Society's Climate Change statement notes, "It is clear from extensive scientific evidence that the dominant cause of the rapid change in climate of the past half-century is human-induced increases in the amount of atmospheric greenhouse gases, including carbon dioxide, chlorofluorocarbons, methane and nitrous oxide. The most important of these over the long-term is carbon dioxide, whose concentration in the atmosphere is rising principally as a result of fossil-fuel combustion and deforestation."

A common response to such an assertion is that long-term climate trends occur in cycles and eras -- and that the pronounced warming trend the earth is undergoing is just a phase.

However, computer modeling of earth's climate is increasingly complex. Researchers can now run simulations that separate out the human and natural factors that have contributed to observed warming trends. For the late-20th century, the climate model findings revealed if human factors are removed, the earth's temperatures would have actually taken a cooling track in response to natural variations in volcanic eruptions and solar output.

The U.S. Global Change Research Program's National Climate Assessment report, published in 2014, lists challenges for agriculture during the next 25 years. If they come to pass, they could curtail agriculture's productivity. Those challenges include the following items.

1. Climate disruptions to agricultural production have increased in the past 40 years and are projected to increase during the next 25 years. By mid-century and beyond, these impacts will be increasingly negative on most crops and livestock.

2. Many agricultural regions will experience declines in crop and livestock production from increased stress because of weeds, diseases, insect pests and other climate change-induced stresses.

3. Current loss and degradation of critical agricultural soil and water assets because of increasing extremes in precipitation will continue to challenge both rain-fed and irrigated agriculture unless innovative conservation methods are implemented.

4. The rising incidence of weather extremes will have increasingly negative effects on crop and livestock productivity, because critical thresholds are already being exceeded.

5. Agriculture has been able to adapt to recent climate changes; however, increased innovation is needed to ensure the rate of adaptation of agriculture and the associated socioeconomic system keeps pace with climate change during the next 25 years.

6. Climate change effects on agriculture have consequences for food security, both in the U.S. and globally, through changes in crop yields and food prices, and effects on food processing, storage, transportation and retailing. Adaptation measures can help delay and reduce some of these impacts.

After reviewing these points, it's easy to understand why audiences pay close attention when climate change is brought up for discussion. Producers, indeed, know that something is definitely going on. They are also aware this "something" is commandeering a change on the farm that may include crop- and management-practice choices.

How these decisions are made -- and the success of their implementation -- will go a long way toward keeping agricultural production on a track of plenty, despite the furious outbursts of Mother Nature.

Bryce Anderson can be reached at

Follow him on Twitter @BryceADTN


Bundle Whole-Farm Policies

Fri. Oct 02, 2015 11:13 AM

By Marcia Zarley Taylor
DTN Executive Editor

HADDONFIELD, N.J. (DTN) -- Whole-farm income insurance has long been the stepchild of federal crop insurance plans, attracting only about 1,000 policies nationwide, or 0.1% of all policies sold last season. But pressure on farmers to economize and recent enhancements designed to appeal to specialty crop and livestock producers could breathe new life into the offering in 2016.

Diversified Indiana farmer Gordon Millar is giving Whole Farm Revenue Protection a serious look for the first time ever. Millar, of New Carlisle, Indiana, has largely relied on investments in irrigation and tiling to guarantee better yields on his seed corn, commercial corn, sod and vegetable crops most years. The instances where an irrigator would have triggered a yield claim were few and far between, he said, so it made more sense for him to self-insure and keep his cash flow and liquidity levels high.

Aside from a catastrophic policy on his field tomatoes, supplemented with a yield rider offered by his tomato processor to cover hail and shore up yield guarantees to 80% of normal, he rarely bothered with crop insurance offerings.

"We irrigate, we have three soil types, and we grow our best commodities on our well-drained soil. So the number of times we'd have had a claim in the past wasn't substantial enough to justify the premiums," Millar said.

What's changed his mind are attractive new rates on the Risk Management Agency's Whole Farm Revenue Protection policies for 2016. He estimates premium costs to insure his entire farm's revenue would about match what he had been paying for his private tomato yield insurance coverage alone.

"Ultimately, what a grower wants to protect is his total gross revenue," not just losses in individual crops, Millar said. As a former farm lender, he knows what counts most in qualifying for credit is repayment ability.

Whole Farm Revenue Protection (known as Adjusted Gross Revenue and Adjusted Gross Revenue-Lite in past iterations) guarantees up to 85% of your five-year average Schedule F income, or next year's projected income, whichever is less. For 2016, policies are available nationwide. Improvements include allowances for farms that have expanded up to 35% and recordkeeping aids to make current year revenue forecasts easier to comply. Producers with up to $1 million in expected revenue from livestock or animal products may also qualify. Total farm revenue from all sources may not exceed $10 million.

"It's not just specialty crop producers, but anyone with three or more enterprises who can benefit from the program," said Tyler Silveus, CEO of Silveus Insurance Group, Warsaw, Indiana. "Someone with corn, soybeans, seed corn, popcorn or wheat would be perfect." One of his diversified crop and egg producer clients found the policy appealing, because there's no insurance sold that can protect against revenue losses from bird flu.

Silveus calls the plan "unbelievably affordable," with more than $1 million of revenue coverage costing less than $10,000 in premiums. "That's half the price of similar corn policies with Revenue Protection," he added. "Definitely it is worth another look, because premiums are extremely subsidized."

Keith Coble, a Mississippi State University economist and a consultant to the Senate Agriculture Committee for the 2014 farm bill, still has reservations about the whole-farm revenue concept. From a policy point of view, he worries they are difficult for loss adjusters to audit, since oversight requires "more forensic accounting skills" than agronomic skills.

Also, most farmers use Schedule F for cash accounting and tax purposes, so "you have to do a bunch of paperwork" to compute income, including taking inventories and fluctuations in farmed acreage into account, Coble cautioned.

From a grower's point of view, the individual is insuring revenue on a "bundle" of commodities, Coble said, so it's more like owning a mutual fund than an individual stock. Your revenue shouldn't fluctuate as widely, so you pay lower premiums for the insurance, but also have a reduced chance of collecting an indemnity. If you raise major crops and have good Revenue Protection options available for individual coverage, he recommends sticking with the sure thing.

However, if you're raising specialty crops that lack adequate revenue insurance, it can be worth considering. Unlike past crop insurance plans, Silveus stressed that this one insures real numbers from your farm, not an indexed figure. "With the lending environment tightening for the 2016 crop year, this policy could make a difference to you and your ag lender," he said.

For more information on Whole Farm Revenue policies go to….

Marcia Taylor can be reached at

Follow Marcia Taylor on Twitter @MarciaZTaylor


Informa Cuts Corn, Bean Crops

Fri. Oct 02, 2015 11:09 AM

By Katie Micik
DTN Markets Editor

OMAHA (DTN) -- Private analytical firm Informa Economics estimates that farmers will produce 13.56 billion bushels of corn with a national average yield of 168.4 bushels per acre.

That's 24 million bushels lower than USDA's September estimate. The average yield is 0.9 bpa higher.

"The new estimate expects the planted corn area to come down 493,000 acres to 88.4 million," DTN Analyst Todd Hultman said. "Yield is expected to rise from 167.5 to 168.4 bushels an acre. Informa's estimate is likely close to what many are already thinking and, if true, should not have a significant impact on corn prices when USDA's numbers are released on Oct. 9."

Informa sees soybean production coming in 57 mb higher than USDA at 3.88 bb with a national average yield of 47.2 bpa, which is up 0.1 bpa even though Informa made adjustments to yield estimates in 10 states.

"Informa's estimate, if true, would still provide bearish pressure to soybean prices, but I am concerned that USDA's numbers will be more bearish than Informa suspects as anecdotal harvest reports are leaning toward higher yields," Hultman said.

USDA will release its next Crop Production and World Agricultural Supply and Demand Estimates at 11 a.m. CDT on Oct. 9. The Crop Production report will incorporate Farm Services Agency data on acreage, which Informa believes will lead to a 1.4-million-acre decline in soybean planted acres.

USDA's WASDE report will also incorporate ending stocks data from the quarterly Grain Stocks report, including revised 2014 soybean production data. Analysts expect USDA will make some changes to the demand side of the balance sheet.

Informa also released its world crop report, which showed expanding soybean production in Brazil.

"Informa estimates Brazil will produce 81 mmt of corn and 100 mmt of soybeans in 2015, both higher than USDA's current estimates," Hultman said. "However, it is too early to take any estimates too seriously for South America yet so price impact is muted."

Brazilian farmers are likely to increase planted area by 4.4% to 33.5 million hectares, according to Informa's survey of planting intentions conducted in late-September.

"Informa's estimate of Ukraine's corn production at 24.5 mmt is less than USDA's current estimate of 27.0 mmt and is one bullish possibility to watch for next Friday," Hultman said.

Katie Micik can be reached at

Follow Katie Micik on Twitter @KatieMDTN


DTN Distillers Grain Update

Fri. Oct 02, 2015 11:04 AM

By Cheryl Anderson
DTN Staff Reporter

OMAHA (DTN) -- The inclusion of distillers grain in beef rations and its growing popularity has brought with it some concerns over levels of sulfur for cattle. That was the impetus for research at Iowa State University that has examined the effect of high sulfur diets on trace mineral absorption in cattle.

Dr. Stephanie Hansen, associate professor of animal science at Iowa State University, has a background in trace mineral nutrition and was interested in looking at some of the major challenges with sulfur, especially with high levels of dried distillers grains. Since sulfur has been known to decrease copper status in cattle, Hansen said she wanted to continue to pursue those concerns.

Cattle do require some sulfur in their diets, but too much sulfur begins to affect trace mineral absorption.

"When we get into that 0.3% or greater amount of sulfur in the diet, that's when we begin to see challenges for trace minerals like copper," she said.

Some areas in the Midwest or Western U.S. have high sulfate water that can contribute to total dietary sulfur as well. However, a lot of the sulfate comes from DDG, from solubles or even from corn gluten feed.

The concerns about sulfur in DDG by nutritionists and producers are nothing new. Many ethanol plants use sulfuric acid as a cleaning agent. Unfortunately, sometimes that sulfuric acid ends up as sulfur in the resulting DDG.

"A lot of the sulfur challenges in the distillers industry are due to plant-to-plant differences in how they use sulfuric acid," Hansen said.

Most ethanol plants perform a weekly analysis of their DDG and have that nutrient/mineral composition information available to producers for protein, fiber, dry matter, and minerals.

But one of the challenges of sulfur is that the load-to-load variations, even from the same plant can be very high.

"If you are a large feedlot, there might be a pretty good variation in sulfur, even among truckloads you brought in within a certain day," she said. "And certainly if you bring in distillers from different plants, the variation in sulfur use can be very high."

So how can producers keep a handle on whether their cattle are getting too much sulfur? Hansen said she tells producer to get in the habit of grabbing a Ziploc bag-sized sample of DDG each time a load comes in and throwing it in the freezer.

"If a week later you didn't have any problems that came up from feeding that load to cattle, you can throw it away," she said. "But if something did happen, you have a sample you can send to the vet for analysis."

Hansen added that ethanol plants understand the sulfur challenge and work very closely with their merchandisers and nutritionists to mitigate risks. If a plant has performed a clean-out and know they have used sulfuric acid, merchandisers share that information to the nutritionist. That way, if a load is a little bit higher in sulfur, they can blend it down with a previous load that was lower in sulfur and lessen the risk.

Some merchandisers told DTN that it is not very common these days that there are problems with sulfur, but in the case that a high sulfur level is found, it is disclosed and sold at a discount. Others said it is sold/discounted on a case-by-case basis, but that DDG with higher sulfur content is usually not sold to cattle producers, but to swine or chicken producers. Pigs and chicken are not as affected by sulfur as cattle.


Trace minerals are important for skeletal growth, muscle growth and immune function in cattle, as well as in reproduction. The four trace minerals Hansen and fellow researchers are most interested in, in regards to sulfur, are copper, zinc, manganese and selenium.

Several trace minerals may become bound up by sulfur in the rumen so they are not available for absorption by the animal and draw down the trace mineral status of the animal over time. Those trace minerals actually form a chemical complex such as copper sulfide or zinc sulfide with the sulfur, adhering to the sulfur so the minerals are not available for absorption and pass right through the animal.

So the researchers looked at what happens with trace minerals in a low-sulfur control diet compared to a high-sulfur diet.

Although Hansen said she is really just getting started on this line of research, so far, the researchers are finding that sulfur decreases cooper and zinc status in cattle.

She added that in the end this research may also have impact on the cowherd, even though they are doing the studies with growing cattle in a feedlot.

"Even though a cow is wintered in a dry lot, she won't necessarily show signs of sulfur toxicity because she is on a high forage diet," she said. "But what you can't see is that her liver is slowly being depleted of trace minerals like copper and zinc."

But equally alarming is that calves depend heavily on trace minerals to support them when they are born.

"If we have poor trace mineral status in the cow, that's going to translate to potentially poor health in that young calf," she said. "We need to give those calves every chance we can to have a healthy start, especially when they're worth what they are today."

Hansen said she and other ISU researchers are also looking at alternate delivery forms of trace minerals that prevent harmful interactions with sulfur.

One method is to bypass the gut altogether with a product called Multimin 90, which is an injectable trace mineral that has copper, zinc, manganese and selenium in it. Researchers at ISU have done research with Multimin 90 in the past and found it quickly increases the trace mineral status of the animal. However, this will be the first time they will be using it in connection with high-sulfur diets.

"We want to see if that would be a way cattle producers or feedlot managers could overcome high sulfur in their diets and increase the animal's trace mineral status so the effect of sulfur won't be as dramatic on them," she said. "We're just going to put it straight into the bloodstream so it gets stored in the liver. Then whatever they don't need they just excrete."

The other method to be studied is using a source of trace minerals called hydroxy minerals produced by Micronutrients that don't go into the solution at the pH normally found in the rumen. These products don't release their trace minerals in the rumen, but do so later in the low pH of the abomasum, so they may not interact with the sulfur.

"If they don't go into the solution in the rumen, they still can be available for absorption in the intestine. It's like the injectable route, except we're still feeding it in the diet," she said.

Hansen said she has just gotten some funding for this line of research and will be continuing in the future.

Although the research has not been published yet, anyone interested can go to the Iowa Beef Center's website (, which has a wealth of information on research, as well as a fact sheet about dealing with sulfur that specifically relates to distillers grains.

Cheryl Anderson can be reached at


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