Agronomist Notes

Its FarmTech week and coincidentally, it’s minus forty! I’ll be speaking on Wednesday at 2:30 pm so feel free to stop by and heckle. This is my last week in the country before I head off on my Nuffield Scholarship adventure February 3rd. I won’t be back until April 7th so the newsletters from now on will focus on agricultural topics from around the world. I’m really excited to share my experiences with you each week as I travel abroad.

This week I’ll discuss the sexy topic of organic matter and the fundamentals of attaining high yields. I have also included a research summary discussing the benefits of cool soil temperatures in zero-till production. We’ll finish with market news. Have a great week.

Agronomy

 

Making the Best of a Limited Resource: Moisture
To maximize the impact of moisture, soil needs to capture the rainwater that falls on it, store as much as possible for future plant use, and allow plant roots to penetrate and proliferate. These conditions can be achieved through management of organic matter, which can increase water storage by 16,000 gallons per acre foot for each 1% organic matter. Organic matter also increases the soil's ability to take in water during rainfall events, assuring that more water will be stored. Residue cover also increases the water infiltration rate while lowering soil water evaporation. When all these factors are taken together, the soil’s ability to produce higher yields with less moisture is possible.

Let’s run the numbers. We know that 1 inch of water over an acre is equal to 27,154 gallons. A 1% increase in organic matter OM raises the soils moisture storage capacity by 16,000 gallons and 1inch of rain produces 4 bushels of canola, 6 bushels of wheat and 8 bushels of barley.

Each additional 1% increase in OM will hold X amount of water producing X amount of bushels per acre.

1% OM: 16,000 gal ÷ 27,154 gal = 0.59 in of water or 59%
Canola: 4 bu/in x 59% = 2.36 bu/ac
Wheat: 6 bu/in x 59% = 3.54 bu/ac
Barley: 8 bu/in x 59% = 4.72 bu/ac

So, by increasing organic matter by 1% we can store an extra 2.36 bu/ac of canola, 3.54 bu/ac of wheat and 4.72 bu/ac of barley. In this example, we can theoretically produce another $15 to $20 per acre in revenue each year by increasing our soils capacity to hold moisture.

I believe it’s time to develop management plans that focus on increasing organic matter. We’re just scratching the surface with our understanding of organic matter and the significant impact it has on crop production. For too long we’ve wrote this process off as something lengthy and uncontrollable. We conventional farmers have belittled it down to something the organic guys do. There is a shining star of hope, however. Thankfully, the business of carbon credit trading has created a new demand for storing higher levels of organic carbon (organic matter) in our soil. I’ll be personally involved in some soil modeling this year that may help us find ways to increase organic matter at a faster rate and the research is being driven by the carbon credit sector. SL

Adapted from: http://attra.ncat.org/attra-pub/drought.html

The Fundamentals of Attaining High Yields
Outside of farming, most manufactures have a research and development plan designed to increase production while reducing costs. It’s a strategy that’s been somewhat overlooked in farming due to the complex nature and natural uncertainty in our system. For instance, how do you measure progress when the variables change each year, like rainfall? It would be difficult to do, measure and replicate, but not impossible.

In our journey towards increased profitability it seems we’ve missed a few steps. We focus on the tangible items like machinery, seed and fertilizer to help us maximize profits. We develop business and marketing plans to help project where we need to be in three, five and ten year’s time. In any of those plans, have you ever seen a soil improvement plan, a plan that takes a look at the limiting factors in our crop production system? A plan ultimately leading to higher production per unit of rain over time?

The process of attaining high yields takes time, planning and the ability to measure progress. Below, you’ll find the top five fundamental practices to attaining higher yields. The list was gathered from a group of the world’s highest yield record holders.

1. A planning process that estimates what the actual attainable yield levels might be within each field, recognizing existing controllable limiting factors and their interactions for the cropping system.
2. A focus on timeliness of all operations and a record keeping system that allows quantification of what works and what doesn't work.
3. The use of technologies such as genetically enhanced varieties and site-specific management to control risk.
4. Long-term dedication to soil improvement, including physical, chemical, and biological properties.
5. A constant watch for yield limiting factors and dedication to the removal of those that can be controlled.

I’ll finish with this- what does your plan look like? SL

Cool Soil Temperatures in Direct Seeding Reduces Crop Stress and Improves Yield
Growers throughout Alberta have often raised concerns about cooler soil temperatures at seeding time under no-till systems, and this is often one of the reasons cited for using conventional tillage. The extent to which these cooler soil temperatures influence crop emergence and establishment and its subsequent growth is not fully understood. Therefore, the focus of this fact-sheet is to summarize all the current information on the effect of cool soil temperature on crop emergence, establishment, growth and yield in direct seeding systems.

Full report: http://www.reducedtillage.ca/docs/Coolsoiltemperaturesin%20directseedingJan08.PDF

Market News

Wheat Prices to Soar
Last August I had a client attend a round table discussion in Chicago with many influential grain traders and ag businessmen from around the world. A grain trader from London predicted then that wheat would climb to $14 a bushel. Looking now, he’s not far off. His prediction now is for wheat to climb to $24 a bushel! It sounds farfetched until you look at the fundamentals of wheat production around the world. It’s hard to find any knights in shining armour. The majority of the Canadian Prairies were dry last fall along with the US Great Plains wheat belt. Russia and the Ukraine were very dry last year with the potential for dry weather once again. India’s monsoon rains are 50% of normal in their wheat growing region. That leaves China who is now in a position to buy grain and not sell onto the world market adding an extra demand source into the equation. The EU is typically wet during periods of La Nina so harvested area may be down and Argentina has high export tariffs in place. I ask again, where will the wheat come from? SL

Report on Key Drivers of Food Price Inflation
There has been intense public debate during the last year about the impact of the growing US ethanol industry on consumer food prices. That debate has been fueled mainly by anecdotal information and speculation. The statistical analysis released by Informa Economics finds little connection between corn ethanol production and consumers food.

The Informa report identifies the so-called “marketing bill”—the portion of final food costs that excludes grains or other raw materials—as a key driver of the consumer price index (CPI) for food, largely due to rising energy and transportation costs.  Another significant factor in consumers’ food bills is surging global demand for commodities.

Full report: http://www.informaecon.com/Consumer_Price_Inflation_Study.htm

Farmers Paid to Store Wheat for Top Customers
Prairie farmers will be paid up to $15 a tonne to store their best wheat in reserve for their top customers. In its second year, the CWB's Wheat Storage Program (WSP) has been expanded to more delivery points across Western Canada. Producers can safeguard their highest-quality wheat on their own farms and receive extra payments and special delivery opportunities. This way, farmers can help ensure that a supply of Western Canada's highest-quality wheat is preserved for their best customers in valuable, long-term markets.
Full story: http://www.cwb.ca/public/en/newsroom/releases/2008/012208.jsp

What Does a La Niña Look Like
La Niña is defined as cooler than normal sea-surface temperatures in the central and eastern tropical Pacific Ocean that impact global weather patterns. La Niña conditions recur every few years and can persist for as long as two years. The map below shows sea surface temperatures. The blue colour indicates cooler ocean surface temperatures while the yellow and red areas indicate warmer temperatures.

A La Niña often features drier than normal conditions in the Southwest US in late summer through the subsequent winter. Drier than normal conditions typically occur on the Central Plains in the fall and in the Southeast during the winter. In contrast, the Pacific Northwest is more likely to be wetter than normal in the late fall and early winter with the presence of a well-established La Niña. Coincidentally, Washington, Oregon and Western BC have seen record rainfall events this winter. Additionally, La Niña winters are typically warmer than normal in the Southeast and colder than normal in the Northwest US.

Expected La Niña impacts during January-March for the contiguous United States include above-average precipitation in the Northern Rockies, the Pacific Northwest, the Ohio and Tennessee Valleys, and parts of the Great Lakes region. Below-average precipitation is expected across the South, particularly in the southeastern states.
El Nino/ La Niña map: National Environmental Satellite, Data, and Information Service http://www.osdpd.noaa.gov/PSB/EPS/SST/climo.html

US Drought Monitor Map
There are many areas in the US in dire need of moisture, especially throughout the southeast. I’ve heard some climatologists in the US say that droughts in the corn and soybean belt are usually precluded by a drought in the southeast. The drought conditions move their way northward during the summer. After four years of record high yields in the corn and soybean belt, I don’t know if a fifth year is in the cards. I can’t imagine what that would do to corn, bean, canola and barley prices. SL 

Map source: http://www.drought.unl.edu/dm/monitor.html

  
Informa Predicts 2008 Corn Acres to Hold Near 2007 Levels
The overall expectation seems to be leaning toward a fairly sizable increase in wheat and soybean area, while corn acres may hold near 2007 levels. Private analyst Informa, in its January estimates for 2008, called for a 4 percent increase in world wheat area, with the biggest increase in US acres, and a 6.5 percent increase in soybean area, mostly in the US and Brazil.
Source: Informa Economics

Local Feed Barley and Feed Wheat Prices
The price for feed wheat in the Calgary and Red Deer area is steady at $220 to $225 a tonne for Jan-Feb delivery. Feed barley prices range from $200 to $205 a tonne for Jan-Feb. There was 1,270 tonnes of No. 2 corn brought into Lethbridge and Edmonton for $225 and $232 for Jan-Feb and March-April delivery. In my opinion, corn and barley are extremely undervalued at this time compared to soybeans and wheat. SL
Source: Cash Market Value Newsletter

CWB Pool Returns Outlook for January: Durum and Wheat Show Biggest Gains
The CWB today released its latest Pool Return Outlook (PRO) for the 2007-08 crop year. Wheat is up $16 to $33 from the December PRO, with durum up $20 to $25. Feed barley is up $5 for Pool A and $4 for Pool B, while malting barley is up $3 per tonne from the December PRO.
CWB PRO: http://www.cwb.ca/public/en/newsletter/updater/012408.html

International Grain Council Wheat Estimates
US wheat carryovers could be the smallest since the 1940s at under 8 MMT. World trade in 2007/08 remains at 104 MMT. Changes since November include a reduction in India’s imports to 2 MMT as its end-season stocks are expected to be adequate, but Pakistan’s purchases are rated higher as local food prices rise. Kenya and Sudan are among countries in sub-Saharan Africa whose import estimates are trimmed, but the forecasts for Egypt and Tunisia are raised. In the EU, the suspension of import duties may further boost purchases. Among small changes to the export forecasts are increases for the US and Russia and declines in the EU, Ukraine and China.
Full story: http://www.agweb.com/get_article.aspx?src=gennews&pageid=140826