Agronomist Notes

Another banner year for the FarmTech conference! It was great catching up with so many of you and throwing around upcoming challenges and opportunities. My presentation on the Developing Trends in Agronomy went well- no one threw rotten tomatoes anyways. Take a look at my session summary if you like on the FarmTech website http://www.farmtechshownews.com/News/Fine-tuning-management-can-add-$50-ac.aspx .

This will be my last newsletter on Canadian soil so from now on you’ll be receiving agriculture profiles from around the world as I travel to six countries on my Nuffield Global Focus Tour. I plan to share as much of my experience with my readers as possible.

This week we’ll look at the final process in my variable rate journey by taking a look from start to finish and focus on the agro and economics of it all. We’ll talk briefly about hail insurance and what kind of coverage many producers are looking at and then finish with market news. Have a great week and expect to read a profile or two on top producers from New South Wales, Australia in the next few issues. Cheers mate!

Steve

Agronomy

Farm Tech Proceedings
If you didn’t get a chance to go to FarmTech this year, I have included a link to the summaries of each day’s concurrent sessions here http://www.farmtechshownews.com/ .

Nuffield Global Focus Tour
The list below is my itinerary for the upcoming two months so you’ll know where I am in the world at any given time.
Feb 3rd - Mar 1st: Queensland, Victoria and New South Wales, AU
Mar 2nd - Mar 8th: San Francisco, Fresno, Salinas Valley, Sacramento, Durham, Yosemite Nat. Park
Mar 9th - Mar 13th: Mexico City and rural areas
Mar 13th - Mar 18th: Ontario, Toronto and surrounding areas
Mar 19th - Mar 22nd: Washington DC, Virginia
Mar 23rd - Apr 2nd: Sao Paulo, Brasilia, Ribeirao Preto, Rio de Janeiro, BR
Apr 2nd - Apr 6th: London, UK
April 7th: Fly home…

Hail Insurance: What are you budgeting?
After working through a few costs of production budgets and staring at the potential for $400 to $600 per acre returns, I wonder how many producers have budgeted for the increased cost of hail insurance. At FarmTech I asked a number of producers what they were budgeting for and their responses actually surprised me. Most said they were budgeting for the normal $200 or $250 per acre coverage. Only a few were looking at increasing coverage levels, some up to $600 an acre. One producer said he was prepared to write a $100,000 cheque this year, a 50% increase in normal insurance coverage. He said there is too much to lose this year and I think he’s right.

I’m not saying that everyone should run out and grab $600 worth of insurance but it’s something we’ll have to look seriously at this spring. Determining the proper level of coverage has become more difficult as we learn to adapt to the additional zeros on the end of our crop input bills and grain cheques. I caution producers to farm for today and not for the past because the typical $200 acre coverage will only allow you to get by another year. To me, that’s not a best practice. SL

Variable Rate Fertilizer: Bringing it Together
After three decades, variable rate technology has made yet another comeback. The difference this time is the cost of equipment has decreased, the cost of inputs has increased and the level of technical knowledge and resources has increased. The number of crop consultants spending the time to investigate this technology has increased as well. Let’s take a look from start to finish on one of the fields I am working with.

Selecting the Field
To start off, I chose this field because I knew that it had variability in it. It had a history of manure, chronic lodging areas, rolling topography and many differences in soil texture like sandy knolls with very little organic matter down to low spots with high organic matter.

Building the Zone Map
The NDVI satellite imagery we used was from the year 2004, which was a wet year but still represented what the field normally looked like four out of five years. The NDVI imagery was visually confirmed once again as we drove around the field during soil sampling and looked at the soil texture and colour of each soil core. The poor areas would be light coloured with a sandy texture while the high yielding areas had a darker colour and loamy texture. The yield zones range from lowest to highest starting with zone one coloured purple, zone 2 is red, zone 3 is burgundy, zone 4 is yellow and zone 5 is olive green.   

Soil Sampling the Zones
Once the zones were selected we soil sampled five cores from 0 to 6” and 6 to 24” in each zone. When setting up your initial GPS benchmark points take a soil core first and make sure the sample looks representative, like the same colour and texture, then mark your point. For example, zone 5 is typically dark coloured with a loamy texture. If your NDVI map shows a high yielding area and you pull a core that is light coloured and sandy, make a note of that area and throw away that core sample. For whatever reason the imagery does not always match up. That’s why the farmer must be part of the process.

Analyzing the Soil Data
You know how I harp on about the importance of organic matter, well here’s why. When you look at the organic matter levels in the table below starting from zone 1 down to zone 5, you will see the %OM goes from 1.3% to a high of 6.9%. When I calculate nitrogen rates, I always factor in the approximate nitrogen released from the soil based on organic matter levels. I will use a value of 6 lbs of nitrogen released for each percent of organic matter. For example, a field with 5% organic matter will release approximately 30 lbs of nitrogen in a growing season. That number can vary a lot but it‘s a conservative starting point. The difference in nitrogen mineralization from zone 1 and zone 5 would be roughly 50 lbs per year. Looking at the N levels in each zone you will see that zone 5 has 249 lbs of nitrogen verses 42 lbs of N in zone 1. Coincidentally this field lodges in certain areas each year. Can you guess what zone I find lodging in?

I will not apply phosphate to this field because our main goal is to draw down the P levels so we can safely apply manure again. I have recommended 30 lbs of potassium although soil test levels are high, to help prevent lodging. The area’s most prone to lodging are zones 3, 4 and 5 so I’ll increase my potassium recommendation to 30, 40 and 45 lbs/ac, respectively, and drop the potassium application in zones 1 and 2.

We’ve decided to reclaim zone 1 with five tonnes of compost per acre in 2008, three tonnes in 2009 and three more tonnes in 2010. If we can get some organic matter added to the soil, it will help improve its moisture holding capacity, nutrient holding capacity and help build yield potential. Some philosophies choose to ignore the low yielding areas but I seek to find the limiting factors in each zone and see what amendments are possible to help reclaim them.   

Setting Yield Targets
Now comes the tricky part. The NDVI imagery will show you differences in yield potential but it does not assign a specific yield value to each zone. We must use our best educated guess to come up with the yield targets for each zone. A yield map is invaluable in this process because you can overlay the map on the NDVI image and pick out the yield results from each zone. Remember, this is a process. The yield values we make today are based on many years of average fertilizing and not necessarily fertilizing to each zone potential. So, the yield map may show a value of 50 bu/ac in zone 4 but we’ve only been applying 70 lbs of nitrogen in that area. What if we begin to apply 100 lbs of N in that area with a balance of P, K and S? 

When you attach yield targets to each zone, I’ve found that zones 3 and zone 4 hold the greatest yield potential across the field. If you are going to set yield targets, don’t be too conservative in zone 3 and 4. These two zones will have good drainage, organic matter and are found along the midslopes. They usually result in the highest yield. However, the yield potential in these zones is immense when you factor in higher seeding rates and fertility to help push these areas further. Pushing zone 1 and zone 5 too hard will net you very little in zone 1 and a lodged crop in zone 5.

Building Nutrient Prescriptions
The nutrient recommendations listed below are based on the experience I’ve had in my particular region from Drumheller to Calgary and up to Three Hills. They are over simplified for this summary because it would take days of writing and hundreds of pages of text to go through each variable, limiting factor, field and management history and what-if scenarios.

The recommendations are for wheat in this example.

Nitrogen: I build nitrogen recommendations by analyzing organic matter, residual soil nitrogen in the top 24 inches and yield targets. For example:

5% Organic Matter: 5 x 6 lbs/ac of N released = 30 lbs of N/ac
Soil Nitrogen top 24 inches = 40 lbs of N/ac
Wheat yield target = 2.3 lbs of N/bu x 65 bu/ac = 149 lbs/ac based on 13.5% protein

Nitrogen Recommendation: 149 lbs/N/ac – 30 lbs/N/ac – 40 lbs/N/ac = 79.5 lbs N/ac
Therefore my nitrogen recommendation for this example is 80 lbs of N, rounding off 79.5 to 80 lbs/ac.

Phosphorus: I recommend phosphorus based on the sufficiency model whether its wheat, barley or canola. If soil test levels show less than 20 lbs of phosphorous per acre, I will typically recommend 40 lbs of P205 per acre. If the soil test results show levels between 20 and 35 lbs/ac I will recommend 30 lbs P205 an acre. If soil test levels are between 35 and 50 lbs/ac, then I apply 20 to 25 lbs of P205 an acre. If soil test levels are over 80 lbs an acre I will not apply any phosphorus at all. However, April 20th seeding dates could see starter P in soils with high P levels.

Potassium: I will typically apply 20 to 30 lbs of K20 on soils with less than 250 lbs of potassium in the top 6 inches. Cool soils with high potassium levels may receive a starter application of 15 lbs/ac depending on the width of the opener. If your seedbed utilization is greater than 40% then I will place 20 to 30 lbs of K20 per acre to give seedlings an early season boost of potassium. If the seedbed utilization is less than 30% than I can reduce my application to 15 or 20 lbs of K20 as a starter because the closer the seeds are to the fertilizer, the greater the opportunity for uptake. Soils with 700 to 1,200 lbs of potassium in the top 6 inches will rarely see additions of potassium.   

Sulphur: I don’t typically apply sulphur to wheat when the yield targets are 50 bushels per acre or less. If yield targets are bumped to 60 or 75 bushels per acre then I may add 8 to 12 lbs of S04 per acre. I have seen positive results from applying sulphur on high pH soils because the ammonium in ammonium sulphate can drop the pH around the fertilizer band causing phosphorus, iron, zinc, copper, manganese and boron to become more available.

Discovering the Numbers
The table below displays the comparative results between my conventional fertilizer recommendation verses the zone management VRT recommendation. At the top of the chart you will see I had a recommendation of 75-0-30-0 with a yield target of 65 bu/ac. Each zone has been given a yield target of anywhere from 35 bu/ac in zone 1 to 85 bu/ac in zone 5. The VRT yield target is 2 bu/ac higher at 67 bu/ac.

The VRT fertilizer recommendation projects it will use 6 less pounds of nitrogen per acre at 69 lbs/N/ac. The potassium recommendation has been eliminated in zones 1 and 2 and increased to 40 and 45 lbs/ac in zone 4 and 5. The VRT recommendation for potassium will use 9 less lbs/ac at a rate of 21 lbs/K20/ac.

The cost of the VRT process is $8.00 per acre and that includes soil sampling, soil analysis, fertilizer recommendations and a prescription map that is copied on to your memory card to slip into you variable rate controller in the air drill. So, in the end we’ve ended up with a projected $8.84 net return on our investment. The future will tell us the reality but at this point it looks promising.

Market News

Massive Snowstorms Hit China
China’s worst snowstorms in nearly 50 years have brought rain, sleet, wet snow and sharply colder temperatures to most of eastern and central China’s winter wheat and rapeseed production areas. Unusually harsh winter had dealt a serious blow to the country's crops and warned that damage could rise because of continued cold temperatures. The crops affected included rapeseed and wheat, although no specific damage amounts by crop were given. Traders and industry officials appear to be most nervous about the damage to rapeseed, an oilseed grown mainly along the Yangtze River that is harvested after March.
An estimated 526,316 hectares of rapeseed were affected in the southern provinces of Guizhou, Hunan and Hubei. The hardest hit province was Jiangsu, where an estimated 64 percent of planted area was damaged by freezing rain, which can destroy leaves, young plants and shallow roots. However, the full impact of the current wintry weather will not be known until the snow melts and the crop starts flowering in March. Analysts suggest that lower rapeseed production in 2008 may force China to import more palm oil and soybeans and increase the prices for all oilseeds.
Source: USDA

Hello La Niña - Drought In The Corn Belt?
It could be a dry year for growing crops in the Midwest, says Elwynn Taylor, Iowa State University Extension climatologist. According to Taylor, La Niña weather patterns and more than 19 years since the last major drought in that part of the world (1988), suggest a drought is likely this year.

Full story: http://enews.penton.com/enews/beef/beef_stocker_trends/2008_01_29_beef_stocker_trends/display

Local Feed Barley and Feed Wheat Prices
The price for feed wheat in the Calgary and Red Deer area has increased from $225 to 235 a tonne for February delivery. Feed barley prices range from $205 to $216 a tonne for Feb delivery. There was 80 tonnes of corn brought into Red Deer for $244 a tonne. It’s only a matter of time until feed barley prices start to climb higher. In my opinion, corn and barley are extremely undervalued at this time compared to soybeans and wheat. SL
Source: Cash Market Value Newsletter

World Wheat News
Ukraine is considering raising grain export quotas, the proposed increase is from 1.2mmt to 2.4 mmt. Australian farmers, boosted by plentiful rains/soaring prices are expecting bumper wheat crops in 2008. Old crop wheat prices remain volatile as massive swings in Chicago are caused by economic, financial and energy concerns. Tightness in supply of high-quality protein wheat continues to support prices, with Minneapolis Grain Exchange- Hard US Milling Wheat achieving record levels in recent trading days.

Full story: http://www.gleadell.co.uk/MarketReport.htm

Bullish Oilseed Futures
The US Soy futures in Chicago have ended higher in three out of the four trading sessions highlighting the volatility in this market at the moment, especially when you consider that at one point in the middle of last week soy beans were down 75c/bu and oil was down US$77/mt but have since recovered about two thirds of these loses.

Full story: http://www.gleadell.co.uk/MarketReport.htm

China’s Says Grain Supply is Adequate
China's grain supply and demand are basically balanced while the grain stock is sufficient, despite a slight decline in 2007 grain ending stocks. The country's grain stock-consumption ratio is far above the international safe line, and it can fully guarantee the domestic supply, said the State Administration of Grain over the weekend. Surging international grain prices and domestic high inflation contributed to the rise in domestic grain prices last year. To stabilize the prices, the government increased its state sales of reserved grain, and the sales amount exceeded the purchase amount, said the administration in a question and answer published on its web site.

Full story: http://www.fxstreet.com/futures/news/article.aspx?StoryId=a69b5588-8763-44e0-99ef-7941579719d5