January 21, 2014

Agronomist Notes

Hello Reader

It was great to catch up with everyone at Agronomy Update last week. I took off my conference hat for a day to load grain. We sent six loads of wheat and a load of canola and are now 100% delivered for the 2013 crop year. I feel for all those who haven’t been as fortunate with sales and delivery. There is a serious situation brewing on the Prairies as land and machinery payments are due but grain is not moving.

In this issue of Beyond Agronomy News, we’ll take a second look at a unique crop revenue insurance program. Then we’ll delve deeper into the newest plant growth regulator in Western Canada that will change wheat production. Last, we’ll take a look at the use of drones (UAV’s) to capture imagery. We’ll finish with technical grain market news.

Have a great week.

Pictured above: Wheat trickles out of the grain bag after a wheel ripped it open. We spent four hours clearing snow before we could start hauling. On the bright side, we have a full moisture profile for this year’s crop. Photo credit: S. Larocque

A second look at crop revenue insurance

For the past three years, Global Ag Risk Solutions, of Moose Jaw, SK, has been offering unique revenue-based insurance plans to farms in Western Canada. I had them present at our client meeting last year. Although the idea was well received, farm margins did not look to be in jeopardy so no deals were signed. Fast forward to 2014 and the outlook for farm margins look tight so it’s time to take a second look at this unique crop revenue insurance program.

The insurance product covers the cost of seed, fertilizer and chemical, plus up to $100.00 per acre coverage over and above the cost of the inputs. What’s unique is that coverage is not based on yield or price like crop insurance; it’s based strictly on revenue.

The folks at Global Ag Risk (GAR) recommend a combination of multiple insurance products to generate the highest net coverage. This would include revenue insurance, combined with hail and crop insurance. The three products together work well. To give you an example, I’ve used my own 2013 numbers to look at the costs and coverage levels covered with multiple products. This will change when new insurance prices come forward in 2014.

Steve’s quick math

GAR program: $11.00/ac for $175.00/ac + $75.00/ac above seed, fert, chem = $250.00/ac

AFSC crop insurance: 60% coverage canola = $7.66/ac for $205.20 but only if yield falls below my crop insurance area average of 18.1 bu/ac. I haven’t been farming long enough to have personal crop insurance yield averages.

Line company hail with 25% deductible is 3.5% = $7.00/ac for $200.00/ac hail coverage

Total coverage: $250.00/ac revenue, $200/ac in hail and up to $205.20/ac if yield was zero.

Video on how it works

When I look at this program, I expect the jack-in-the-box to pop up and say, Ha ha! Just kidding! I will mention that GAR’s premiums are low because they only pick the top producers by reviewing 5 years of accrual-based accounting records. If you qualify, then you can be insured. If you think about it, it’s kind of like selling insurance to people who don’t need it. Then again, the same can be said about AFSC crop insurance. We rarely collect crop insurance and many of us take it for the cheaper hail premiums offered through AFSC.

In the end, a bundle of insurance products are a good strategy and Global Ag Risk has even gone so far to say you can leverage against the revenue insurance. If you can guarantee a minimum revenue, like $250 an acre in this example, the banks may be more inclined to lend money to help you expand. However you look at it, with shrinking margins and the outlook for breakeven revenue at best in 2014, Global Ag Risk’s revenue insurance program makes a lot more sense today than it did last year. SL

If you want to find out more, contact Claus Toerper claustoerper@agrisksolutions.ca or Ilene Gellings at ilenegellings@agrisksolutions.ca

Plant Growth Regulator tailored to Western Canada

Manipulator release hopeful for 2015

I’ve been using plant growth regulators on large-scale trials for the last four years with some excellent results in wheat, barley and field peas. For products, we’ve just used what’s available, like Cycocel Extra and Ethrel. There are a couple of limitations to these products: 1) they’re not optimized to perform well in our climate or 2), they require very specific crop staging. I recently had a chat with Phil Bernardin, of Engage Agro who is launching a PGR called Manipulator in 2015 that is tailored for Western Canada’s cool climate. I believe Manipulator will be a game changer in lodging resistance and straw management in wheat.

The initial product results from 52 locations across three provinces over three years in wheat are listed in the table you see here. There was a 94% chance of seeing a 5% reduction in height down to a 28% chance you’ll see a 20% reduction in plant height. There was an 86% chance of seeing a 5%+ yield increase and a 67% chance of seeing a 10%+ increase in yield. Often times the yield advantage would occur in the absence of lodging which tells me the product is generating added moisture and nitrogen use efficiency.

Here are some key points about Manipulator:

The active ingredient is chlormequat chloride 620 g/L with low temperature activators and safeners.
The application rate used in trials has been 700 ml/ac.
Designed to work as low as 1C.
Optimal timing from trials: 3 to 4 leaf, 1 tiller GS 21-29 (herbicide timing) and 5 to 6 leaf GS 30-32.
Trials with early applications at herbicide timing had significant height reductions and yield benefits.
In the absence of height reduction, treated crop still prevented lodging and had thicker stems.

As we try to push wheat yields with higher plant densities and higher nitrogen rates, one of our biggest risks is lodging and harvestability. Manipulator is designed to address both of those issues and the results so far have been very positive. As far as I can tell through some detective-like questioning, Manipulator will be priced somewhere between $10.00 and $15.00 an acre. If you’re interested, it may be possible to participate in a PMRA trial with the product contact Phil Bernardin from Engage Agro, philbernardin@engageagro.com. SL

Unmanned Aerial Vehicles

A look at the use of UAV's to capture imagery

The hottest thing in precision agriculture today is the use of unmanned aerial vehicles, called UAV’s or drones, to capture imagery. Fixed wing planes or helicopters equipped with a GPS and a camera gather normal light, infrared, thermal, NDVI, still photos or video. These images are digitized, geo-referenced and mapped. From there you can use the imagery to scout fields, find nutrient deficiencies, emergence issues, measure flood damage or build prescription maps like VR fungicide or VR nitrogen.

There is a wide price range for UAV’s that start from $1,200 and go up to $35,000. I’m sure you can go much higher depending on the number of cameras and payload you want to carry. The UAV’s can operate from 20 minutes to an hour and can fly up to 15 miles away from the base at an altitude of 400 ft. The two UAV’s I’ve looked at are the senseFly by eBee and the AutoCopter by CIC Autocopter. The AutoCopter comes fully equipped, field ready with training for about $19,000.00 USD. See senseFly in action here.

In 2013, I had a field demo at my place to see first hand how the fixed wing UAV mapping process worked. My first impression was that this process has a great deal of refining to go through before it becomes a scalable tool. Here is the process in a nutshell:

1) Set up base station, laptop, prep UAV flight pattern: 30 minutes
2) Launch UAV, proceed with flight pattern and landing: 20 minutes
3) Pick up UAV, grab memory card from camera, begin processing: 10 minutes
4) Process 1 gigabyte of data and turn into usable map: 60 minutes to 2 days
5) Upload imagery into field scout software: 10 minutes
6) Begin scouting

The numbers will vary depending on how refined the process is but in this example you’re looking at 2 hours and 10 minutes to map a 160 field. The labour alone will cost $320.00 for a precision ag consultant. The processing, ground-truthing, analysis and possible prescription map would be another $300.00-ish for a total of $3.87 an acre cost before a profit margin is added. That on top of mapping a possible 1,000 to 1,500 acres a day would mean a few days to map and process an entire farm. That’s if the wind stays below 15km/hr each day so you can fly a consistent flight pattern. Bottom line, the tool is great but the process has to be seriously refined to be scalable.

There is no doubt there is a need for real-time imagery to help us pint point problem areas in the field and address them accordingly. We are at the beginning of the learning curve with UAV’s and it will be steep, expensive and time consuming. In a few years we should have a well-refined process to map and process data quickly so this tool becomes a viable scouting tool in the future. For now, we’ll just watch the field demos. SL

Travel Schedule & Speaking Engagements

My winter speaking schedule is below. Maybe we’ll have a chance to catch up if you’re attending one of these events.

FarmTech: Edmonton, AB, Jan 28-30
GRDC Update: Ballarat, Victoria, Feb 5
GRDC Update: Lake Bolac, Victoria, Feb 6, 7
ORM Meeting: Lake Bolac, Victoria, Feb 7
GRDC Advisor Update: Temora, New South Wales, Feb 11
GRDC Update: Corowa, New South Wales, Feb 12, 13