Agronomist Notes
The past week was full of more soil sampling, fertility analysis, and a carbon credit trading workshop. From the soil test results so far, I can see a trend in lower nitrogen levels compared to last year and increased sulphur levels. We can attribute these results to an abnormally wet May/June which caused significant nitrogen loss through denitrification and a hot and dry July/August which tends to wick up salts in the form of sulphur towards the soil surface through evaporation. To date, there is about 1.25 feet of moisture in the soil profile which will give us a great start for next year.
There are a few producers still looking to lockup canola seed, sign fixed price contracts before expiration October 31 and secure fertilizer deals. I have three clients moving forward with variable rate nutrient application this fall. After checking on equipment compatibility in a few weeks, we’ll begin the process of analyzing satellite NDVI imagery, GPSing field boundaries and identifying soil management zones. I’ll keep you informed of the opportunities and challenges we face.
Agronomy
What will it take to produce 150 bushel canola?
I’ve included the article below, even though it’s about a soybean grower in Missouri, because it features an unwavering commitment to push crop yields beyond levels even dreamed of. What if I told you this farmer from Missouri now wants to achieve 200 bu/ac soybeans after he achieved 154.7 bu/ac this year, which broke his 2006 record of 139 bu/ac. The average US soybean yield this year is predicted to be around 41 bu/ac. So his goal is to achieve a yield that is five times the US average. In Canada, the equivalent would be to ask if anyone is chasing 150 bu/ac canola.
What if I want to achieve 100 bu/ac canola, 130 bu/ac spring wheat and 200 bu/ac barley on dry land? I wouldn’t be the first one to ask this question, but I would truly like to know what it would take. What areas of crop production would I have to manage differently to achieve such a lofty goal? First we need to understand which areas of crop production influence yield. Take a look at the nearby yield chart and we’ll tackle these issues starting with water management next week.
World Soybean Yield Record Broken Again in 2008
Kip Cullers from Purdy, Missouri set the new world soybean yield record. I called him to get his reaction. Kip said was excited about his results but says he has to revamp his thinking to get to 200 bushels. I asked Cullers to list the top five points he wanted to share with other producers: 1) chose the very best genetics, 2) practice good foundation agronomy, 3) water frequently to keep pods on the plant, 4) use a seed treatment and inoculants to enhance root development and nodulation and 5) use a fungicide to protect the green leaf area.
The Effect of One-Time Tillage on No-Till Fields
While many farmers use continuous no-till when growing crops year to year, research from the University of Nebraska shows it’s possible to conduct a one-time tillage operation for problems such as controlling difficult weeds, breaking a compacted soil layer or reducing the risk of phosphorus loss and not destroy the soil quality gained by using no-till farming. Nebraska soil scientists found a one-time tillage pass did not destroy the agronomic and environmental benefits gained by continuous no-till, or the absence of tillage, which is counter to some in the industry who thought a one-time tillage pass could destroy the soil quality gained after many years of no-till. Researchers found one tillage pass in 10 years or more did not reduce soil organic matter, soil physical properties or yield.
Variable Rate Cuts Costs, Pushes Plants Towards Once-over Harvest
Combining variable rates, productivity zones can save producers money. Making variable rate applications of inputs based on the infrared reflectance of the crop can save producers a good chunk of money. But integrating three or four permanent productivity zones into the formula could save even more, according to Tim Sharp, precision agriculture professor, Jackson State Community College.
Source: http://deltafarmpress.com/news/variable-rate-zones/index.html
Super Powering Profits
The article link below examines how managerial accounting can superpower profits. In addition to future magazine coverage and additional online resources, a series of educational workshops is being planned for after fall harvest.
See article: http://www.agriculture.com/ag/category.jhtml?categoryid=/templatedata/ag/category/data/1190524748383.xml
Market News
Canola Prices
The recent weakness in canola is attributed to spill over selling from soy and crude oil, continued concern about soft export demand, growing canola supply in visible positions in western Canada, and technical selling. The losses were curbed by weakness in the Canadian dollar, reluctant farmer selling, and the pricing of routine export business with Mexico and Japan. The long term forecast for canola remains bullish. SL
Reference: DTN Canada
2007-08 CWB Fixed Price Contract (FPC)
The 2007-08 fixed price contract expires October 31, so if you plan to use the FPC to hedge this year’s production, you have seven days left.
Link to FPC listing: http://www.cwb.ca/db/contracts/ppo/ppo_prices.nsf/fixed_price/2007_index.html
2008-09 CWB Fixed Price Contract
As of yesterday, the 2008-09 December FPC through the CWB was $255.91 a tonne. Historically, that’s an excellent price, and with increased wheat acreage around the world it may not be a bad idea to price some wheat for next year. I realize that most of us who priced wheat last April at $5.30 a bushel, canola at $8.00 and barley at $3.10 aren’t in a hurry to lock in prices. However, I’ve locked in 80 tonnes of feed wheat a month ago for October ‘08 delivery at $220/tonne or $5.98 a bushel. Feed wheat now sits at $173/tonne. Even though forward contracting didn’t work out as well this year, it doesn’t mean we should ignore the possibility for next year. SL
2008-09 FPC: http://www.cwb.ca/db/contracts/ppo/ppo_prices.nsf/fixed_price/2008_index.html
Feed Barley & Feed Wheat Prices
The delivered price for feed wheat in the Calgary area is hovering around $220 a tonne or $5.98 bushel for October and November. Feed barley prices are hovering at the $190 a tonne or $4.13 bushel for November delivery. The feed market may continue to soften with the number of cattle moving south to US feedlots where corn is more affordable than barley. Corn has become very difficult to source into Canada with logistical issues popping up. Many hog and cattle producers are better off selling their feed barley into this market and importing corn at $190 a tonne, however, it’s proving difficult to do. SL
CWB Online Variety Survey Results
An innovative new online tool has been introduced to help farmers easily view the Variety Survey results. Using the computer mouse to “hover” over an area on a map of Western Canada, boxes instantly pop up listing the top varieties of various grain classes in each crop district. Increased regional differences make this a particularly useful detail. Another new tool allows quick viewing of charts and graphs showing province-by-province trends in seeded varieties.
2007-08 Variety Survey: http://www.cwb.ca/public/en/farmers/surveys/variety/2008/#tool
Australia’s Parched Wheat Crops Well below Average
Predictions for Australian wheat yields by state and federal agencies are generally well below average to average because of dry weather, underscoring the precarious nature of the wheat crop. Crops have already failed across huge areas. The northern and eastern parts of Western Australia’s wheat belt, the west of South Australia, parts of central and eastern Victoria, most of New South Wales and parts of southern Queensland “are all indicating forecasts of well below average yields,” according to the monthly update.
Source: CBOT News
Drier Winter Predicted in the US
The ongoing La Niña should lead to below-normal rainfall in the US during November-January, resulting in drought continuing or re-intensifying. The outlook even indicates a good chance for drought to redevelop in parts of Florida. Drought is forecast to persist from north-eastern Alabama to the Mid-Atlantic States. There is a chance that drought will develop by the end of January in New Mexico, south-eastern Colorado, the western Oklahoma Panhandle, and the northern Panhandle of Texas.
Source: http://www.agweb.com/images/content/season_drought101807.gif
Importing Corn and Exporting Feed Barley
More American corn than usual is coming into Western Canada. Meanwhile, feed barley exports out of Western Canada will be much higher than usual. On the surface, it doesn’t make much sense. Feed barley faces a steep rail transportation bill to get it to port position. Then it faces record high ocean freight costs to reach customers in Japan and Saudi Arabia. Even after all these costs, the export market is currently competitive with what feed barley is worth on the domestic market. Some countries want feed barley and when supplies are short in the other exporting countries - Australia, Ukraine, Europe and Russia - they’ll pay enough to draw it out of Western Canada even though the transportation costs are huge.
Source: http://www.hursh.ca/default.asp
EU Looking to Drop Biofuel Subsidy
European Union subsidies that encouraged farmers to grow biofuel crops have reached their annual limit. The payment “subsidy” has been very useful in stimulating the European biofuel sector. However, the EU Agriculture Commissioner questioned if the subsidy was still needed. Next month, they will have to decide whether it is still necessary. They now have a binding target for biofuels and a blossoming marketplace. To encourage farmers to grow these crops, the EU agreed four years ago to pay subsidies for up to 2 million hectares (5 million acres) of European farmland- or 45 Euros ($25.80) per acre. But farmers asked for more this year- 2.8 million hectares (7 million acres). This will mean the EU will spend its entire biofuel subsidy budget of 90 million Euros ($128 million) this year for the first time. Because the total applications are over the limit, farmers will only get payments for 70% of the land they applied for.
Source: http://www.boston.com/news/world/europe/articles/2007/10/17/eu_biofuel_grants_hit_limit/
Russia to Implement 30- 50% Export Tariff on Wheat
News from the Russian Economic Ministry that they may implement a 30% export tariff helped support the solid gains and a limit-up move last Friday. The president of the Russian Grain Union even indicated that the tariff could be as high as 50%, which added to the positive tone. Traders and economists feel the new 30% tariff (if implemented) could quickly boost world wheat prices. Some traders believe that a tariff of 30% could mean 1.2-2.0 million tonnes "less" in Russia exports per month if the tariff goes into effect by December 1st. Importing countries have very few options from whom they can purchase wheat. Canada and the US stand to gain an advantage with this recent news.
Source: Inside Futures
Global Oilseed Stocks Lowest in 5 Years
World oilseed stocks of are expected to plunge to 64.8MT, down 18MT from last year, taking ending stocks to the lowest level in 5 years. Plantings throughout Europe will be down 5-10%. The UK is now expected to be at least 10% lower with some farmers on heavy land ripping up poorly established crops and replacing them with wheat. In short, the world needs good yields next year, and any problems with oilseed crops anywhere around the world could be potentially explosive to prices.
Source: Gleadell
