Agronomist Notes

I spent most of last week at the FarmTech conference and it was great to catch up with many of you. A highlight for me was the two hour debate on row spacing with the SeedMaster rep over a few cold ones. I baited him by saying we should all go back to 6-inch row spacing on cereals and out to 18-inch rows on canola. The 232 bu/ac world record wheat producer says 6-inch rows aren’t so bad after all. You should have seen the puzzled look on his face. Priceless! 

In this issue of Beyond Agronomy News, we’re mostly outside the agronomy box. We’ll start by looking at a new revenue insurance program that looks very promising in Western Canada. I’ll discuss a profitable crop rotation that includes malt barley, canola and wheat in a three-year rotation and then I’ll dive into a clever land lease agreement to help you stay competitive through rental land bidding wars. We’ll finish with fundamental and technical grain market news.

Agronomy

A new multi-peril revenue insurance program offers a great alternative to crop insurance

A new multi-peril revenue insurance product has hit the Western Canadian marketplace recently. What’s unique about this product is the fact that it insures you for revenue and not production and I believe it’s the first of its kind. The company behind the offering is Global Ag Risk Solutions of Moose Jaw. The founders are financial planner Grant Kosior, Dean Klippenstein of Meyers Norris Penny and insurance specialist Clark Coulson.  

The Production Cost Solution is a revenue based multi-peril insurance that provides guaranteed revenue above input costs (fertilizer, seed, chemical).

• As costs (fertilizer, seed, chemical) rise so does coverage, therefore rewarding strong agronomy.
• Decrease in commodity prices does not affect coverage.
• Coverage is based upon your actual sales results (no regard for area average).
• Independent from all government programs.
• Costs are competitive with hail insurance but covers full spectrum of perils including price.

Here are the nuts and bolts of how it works. A producer can purchase margins over and above variable inputs (seed, fertilizer, chemical) of $25, $50, $75 or $100 an acre. Should your revenue fall below the cost of inputs plus your margin, you receive a claim for the difference. Should you have a production failure or a severe drop in the price (#1 HRS to a CW Feed) you can claim the difference and still cover your inputs. Of course, the higher the margin you choose, the higher the premium will be.

With this program every producer will be accessed based on 4 years of historical farm financial results (accrual basis), Grant Kosior expects premiums for most producers will be around the same range as what hail insurance costs. Not every producer will qualify. This is a private offering and they’re going to pick producers who have a good history of generating strong revenue per acre. No more than 400 producers will be accepted in this first year.
 
If you want to find out more, contact information is available through www.agrisksolutions.ca. SL

A look at a successful rotation for malt barley growers

I’ve looked at a number crop rotation options for clients who consistently produce malt barley. The biggest challenge we face is maintaining a one in three rotation for canola, which pays the bills, while still fitting in HRS wheat and malt barley. In a three-year rotation, the producer is forced to choose 1) canola-wheat-wheat, 2) canola-barley-barley, 3) canola-wheat-barley, or 4) canola-barley-wheat. Here are those options and challenges:

• Can-wht-wht: Second year wheat takes a hit on yield, typically upwards of 10%.
• Can-bly-bly: Second year barley takes a hit on yield plus the additional cost of fungicide.
• Can-wht-bly: Volunteer wheat pops up and downgrades your malt barley to feed.
• Can-bly-wht: Volunteer barley pops up in your wheat and your No.1 HRS turns into No.2 or No.3.

The best option as I see it is option 4 with canola-barley-wheat. The key to addressing the main problem in this rotation, volunteer barley, is choosing the right wheat variety. I’ve had a few clients switch to Clearfield wheat varieties like CDC Imagine for shorter growing seasons and CDC Abound in longer growing seasons with great success. We’ve managed to produce malt barley, maintain the one in three canola rotation and keep the volunteer barley out of the wheat. That’s a home run in my books!

Here are the considerations with Clearfield wheat in a canola-barley-wheat rotation:

• It offers a Group 2 wild oat herbicide option which also does a tremendous job on volunteer barley. I prefer the herbicide Altitude FX rather than Adrenaline in the Clearfield system. The Altitude FX gives you imazamox to control the volunteer barley, fluroxypyr to boost kochia, cleavers and chickweed control as well as MCPA to help suppress perennials like Canada thistle. 
• Your wild oat herbicide rotation becomes a Group 10-1-2 or 9-1-2. You could add a Group 3 like Edge before canola for wild oat control and save your Group 1 for Liberty Link canola.
• Re-cropping restrictions are minimal. You can plant peas, canola, lentils, barley or conventional wheat after Clearfield wheat.
• CDC Abound yields 8% higher than the popular variety AC Harvest with 0.1% higher protein. CDC Abound is a few days later than AC Harvest but CDC Imagine is right in line with AC Harvest for maturity.
• CDC Imagine yields 1% higher than AC Harvest but has 0.2% less protein on average.
• CDC Imagine and Abound are the same height as AC Harvest and CDC Go.
• CDC Abound is rated as fair for lodging compared to a good rating with popular CDC Go and AC Harvest. Clearfield wheat is not great on manured land. There aren’t many barley growers using manured land due to protein issues so it shouldn’t be an issue. 
• Clearfield wheat will not weather or hold its colour like AC Harvest should it rain during harvest. Then again, what other variety can?
• You have to buy certified seed every two years at a premium over and above regular certified seed. This adds up to roughly $8 acre extra every two years. The upside is you’re replenishing your seed stock every two years.
• One drawback could be that you can only buy it through Viterra. This may not be true, depending on your relationship with the local facility.
• Clearfield herbicides are great on volunteer barley but won’t perform miracles on hailed out volunteer barley. If the population density is low than Clearfield herbicides work well.

This rotation can be quite profitable when you can produce malt barley, canola, and HRS wheat without any volunteer barley issues within three years. I like the herbicide rotation potential, even in a short three-year rotation both for broadleaves and wild oats. The additional cost of the seed is minimal when it allows you to grow wheat on barley stubble successfully. SL

FAQ’s on BASF Clearfield wheat: https://agro.basf.ca/basf/agprocan/agsolutions/webasclprod.nsf/WebCommonQWheat?OpenNavigator#Requirements

Land rental agreement

I came across another clever land rental agreement put together by provincial tax specialist Merle Good. Rental land is hard to come by so creating clever alternatives may be the difference between expanding and going nowhere. 

Here’s how it works:

Set the cash rent as a percentage of the area average crop insurance coverage. This rate is determined by calculating the $/ac coverage on a typical rotation and then determining the percentage to equal cash rent. For example, in area A, coverage is $220 per acre. The cash rent in this area is $55 per acre so our rate would be 25% ($220 x 25% = $55/ac).

Now, as crop prices increase the coverage rate will increase and so will the cash rent. Example: Area A coverage increases from $220/ac to $240/ac so cash rent becomes $60/ac ($240 x 25%) an increase of $5/ac. I like using area average and not individual average as this eliminates crop failures and hail damage that may occur on a single farmers land. Also, a farmer’s ability to increase yields and market wisely should be awarded to him, not the landlord. 

To initiate this concept most landlords will still want a base rate. If this is agreed to then there should also be a cap. In my area I think $45 would be the floor and $75 the cap (i.e.  $10 dollars downside and $20 dollars upside from the $55 market rate).

This rental agreement is clever in the way it allows the land lord to share in upside potential but only when crop insurance coverage increases, which is reflective of increasing commodity prices. The worst case scenario with paying straight cash rent is that it doesn’t reflect changes in commodity prices. You could be stuck paying top dollar for land rent while commodity prices tumble to unprofitable levels. I like the way this rental agreement reduces exposure during times of low commodity prices and provides additional crop insurance coverage to reduce the risk of paying higher cash rent during market rallies. Good luck with your bids this year. SL

Reader comments on application of liquid urea to boost protein

In wheat, applying liquid urea in heat, drought stress and high evaporation would be a real concern. Anything over 20 degrees C is too hot. Even straight water can scorch at 30 degrees C. Ideally you want damp and humid conditions. Add more water to the mix if you if you find leaf burn. I have seen a bit of leaf scorch in canola when done at 26-28 degrees. Just gives speckling of the waxy cuticle on the stems and pods. There are no leaves by that stage, which is why it is less susceptible. Nick Ward, UK

We’ve found excess burning applying liquid urea on wheat. We like to apply in 18-30 degrees C and try to apply late in the afternoon on cloudy overcast days, with water rates around 10 US gal/ac. We try to apply it prior to flag leaf to reduce the effect from the leaf burn that does occur. We have some difficulty dissolving urea into water, finding it gets very cold? Our mixing method is to drop water and urea into a tank and bubble air up from the bottom to mix and agitate. Mark Modra, South Australia

In the past we have used between 21 and 32 US gal/ac of a 20% liquid urea solution, sprayed onto the crop at the flowering to milky dough stage. The application must be done when it's cool (i.e. early morning or in the evening to avoid scorch). The product can be watered down which also helps reduce any risk of crop damage. We do spray it on with a standard flat fan to get good coverage of the ears, whereas we normally use dribble bars for putting liquid 37% urea/an mix on earlier in the season. We have also been experimenting with using Nufol (trade name for 20% liquid urea) after flowering in canola. Research shows that N stops being translocated in the plant up to the pods at around this time, and therefore the argument goes, don't put so much into the stem but apply it directly to the pods. I'm sure there is sound reasoning behind this but we have yet to be convinced. Andrew Scoley, UK

Agronomy Update proceedings and online presentations

The following is link is to the Agronomy Update Proceedings, which are posted on the Government of Alberta website.  If you require further information or wish more information on a particular session, the speaker contact list is also included.

http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/crop13462