Red River Farm Network News

Cattle Guys in a Good Position — Mitch Bartels with Perham Livestock Auction sees both the cow-calf guys and the feedlot guys in a good position right now. “If the cow-calf guy has the ground, grass and hay, he’s in the driver’s seat. But, if you’re feeding corn at $3-something a bushel and you’re feeding cattle that are worth $2 per pound plus, there’s probably never been a better time to feed cattle.” Bartels sees a lot of obstacles to getting the US cattle herd built back up. “The fences that came out for crops to go in, aren’t going to be put back up. If you have to borrow money to buy land and cows, the bank probably isn’t going to go along with you. So, it’s the guys that are established that will have to do it. Some of them probably have a few gray hairs and with cows worth $2,000 to $3,000 each, they might be thinking about selling instead of adding on.”

ADM Sells Chocolate Business — Archer Daniels Midland has announced an agreement to sell its chocolate business to Cargill for $440 million. The proposed sale is expected to close during the first half of 2015 and is subject to regulatory approval. The transaction includes ADM’s three North American chocolate plants and three in Europe. Cargill Cocoa and Chocolate North America president Bryan Wurscher says the acquisition will help Cargill better serve its customers in North America and Europe and is a major milestone in Cargill’s growth strategy.

Novak Named NGCA Head — The National Corn Growers Association has announced that Chris Novak will become its next chief executive officer, succeeding Rick Tolman, who has announced his retirement from NCGA. Novak’s first day with the Corn Growers on October 13. He’s been the CEO of the National Pork Board since October 2008. Prior to that, Novak worked for the Indiana Corn Marketing Council, the Indiana Corn Growers Association, and the Indiana Soybean Alliance. He’s also worked for Syngenta and the American Soybean Association, and worked on Capitol Hill.  

GMO Ballot Measure Bringing in the Dollars — Groups for and against Oregon’s GMO ballot measure are drumming up support for their causes. Politico reports that in July, Oregon Right to Know, the group supporting the initiative, brought in more than $265,000, a quarter of the $1.4 million raised by the group so far. Meanwhile, No on 92, which is leading opposition to the labeling campaign, has so far raised $327,000.

Late Blight Moving Around in MN — Late blight has been confirmed in Benton County, Minnesota, in commercial potatoes and it has been moving into additional fields as a result of rains, high dew points and cool weather. Growers in Central Minnesota are being advised to scout fields, apply fungicides to reduce tuber infection and kill fields to prevent further movement. Late blight continues to move in southeastern Idaho and in Wisconsin and Michigan. 

UM Alumni Awards to be Presented in October — The University of Minnesota Alumni Association will honor outstanding alumni volunteers during its annual awards celebration October 16. At that event, Minnesota FFA Foundation executive director Val Aarsvold and former Federal Reserve Bank of Minneapolis corporate secretary James Hammill will receive the CFANS Alumni Service Award.

Continued Frustration With CongressThe US Custom Harvesters continue to lobby Congress for immigration reform and several other items that are important to the custom harvesters. USCHI executive Tracy Zeorian says immigration has been a frustration for the industry. “The harvesters had such a hard time getting American employees and keeping employees. If the H-2A program changes and becomes worse than it already is, we’re going to be a hurting industry.” Zeorian says the fuel tank rules also remain a big concern for custom harvesters. “The fuel thing has been going on since 1991.” Zeorian is fairly certain nothing will get done before the November elections.

ND and ID Last States to Wrap Up Winter Wheat Harvest — The hard red winter wheat harvest is virtually complete in every state with the exception of North Dakota, which is 45 percent done, and Idaho, which is 85 percent complete. US Wheat Associates reports many of the remaining hard red winter wheat acres in North Dakota may never be harvested due to heavy rain leaving standing water in the fields. While another 43 samples were collected and shipped to the lab last week, only eight samples were added to the weekly report. Approximately eight percent of the spring wheat samples have been collected and analyzed for quality. Average protein content is 13.6 percent, equal to last year’s final average and just above the average hard red winter wheat protein of 13.3 percent. Test weight average for the spring wheat is 61.5 pounds per bushel, down from last year’s final average of 62.3 pounds. Falling number average is over 400 seconds, indicating a sound crop at this time. The average grade of the spring wheat samples collected so far is No. 1 Dark Northern Spring.

Break-even Year — After three years of profits, analysts are calling this year a break-even year for crop producers, at best. Mark Greenwood, senior vice president of AgStar Financial, says it’s the absolute flip of where farmers were 12 months ago, referring to corn prices that have fallen from over $6 a bushel to $3.60 on the Chicago Board of Trade. While most farmers should have built up some reserve capital and reduced some debt to weather a down year, costs have risen rapidly, Dale Nordquist, with the University of Minnesota’s Center for Farm Financial Management, says costs of production are way out of balance with expected revenue. If costs stay the same as last year, and if corn prices stay below $4, Wells Fargo ag economist Michael Swanson says farmers could lose about $1.25 per bushel this year. 

USDA Getting Better at Forecasting Yield — There has been a widespread view that the final yield estimate of this year’s national average corn yield will be above the USDA’s August estimate of 167.4 bushels per acre. Much of the expected yield increase is based on the idea that big crops get bigger, with support also coming from relatively high crop condition ratings. University of Illinois ag economists Scott Irwin and Darrel Good have analyzed USDA corn yield forecasts since 1990 and say there is no evidence of bias in August, September, October, or November. Irwin and Good say there is compelling evidence that the accuracy of USDA corn yield forecasts has improved over time, particularly since 2011.

Brazil Increasing Soybean Acres — Soybean and Corn Advisor President Michael Cordonnier says as Brazilian farmers prepare to plant their 2014/15 crop it is becoming apparent that they will be increasing soybean acreage and reducing their full season corn acres. Cordonnier says in northern Parana, Cooperatives report 90 percent of the inputs purchased by their members are for soybeans and only 10 percent is for full season corn. The cooperatives are reporting more than half of the soybean seed purchased is early maturing soybeans that will be harvested in January or early February, allowing enough time to plant second crop or safrinha corn. The Parana secretary of agriculture is estimating soybean production to increase 10 to 20 percent while full season corn production will decline as much as 50 percent.

Divide Between Break-even and Current Land Rents — There will likely be a large divide between break-even rental rates and the current market for land rents. That’s the word from University of Minnesota Center for Farm Financial Management economist Dale Nordquist. The center has released a new web-based tool called FairRent. Nordquist says FairRent will provide useful information as farmers and landowners begin negotiations this fall. 

Economist Expects Winter Wheat Exports to be Lower — Oklahoma State University Extension economist Kim Anderson says hard red winter wheat exports are projected to be 20 percent lower than last year. With 22 percent of the marketing year complete, hard red winter wheat exports are 33 percent below the same time last year. For hard red winter wheat prices to increase, Anderson says export demand must increase. World wheat production is projected to be a record 26.3 billion bushels. Russia may be harvesting a near record wheat crop as is the European Union. However, quality problems have been reported in France and Germany. Anderson thinks the odds are against the wheat crop getting bigger, so he thinks there is more upside price potential than downside price risk.

China Stops Alfalfa Imports — China has stopped imports of US alfalfa after shipments tested positive for the Roundup Ready trait. The biotech crop is approved in the US, but not China. At one point, China would accept alfalfa with a five percent threshold for the biotech trait. Now, China has a zero tolerance for Roundup Ready trait and has implemented new testing procedures. 

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Boehringer Ingelheim Sponsoring BQA CertificationBoehringer Ingelheim Vetmedica, Inc. has again offered to pay the Beef Quality Assurance online certification fee for producers who enroll from now through October 31. The offer is open to beef or dairy producers who want to become certified or recertified. More information is available at

Join RRFN at Big Iron Once again, the Red River Farm Network is hosting seminars in our tent during the Big Iron Farm Show. Industry-leading market analysts are on the schedule each day. Seminars on farm bill implementation, weather and data technology are also planned. Go online to see the schedule.

NFU Adds to Communications Staff — Dave Ray has joined the National Farmers Union staff as a communications consultant. Most recently, Ray has been with North Bridge Communications. Previously, Ray was the vice president of public affairs for the American Meat Institute. Andrew Jerome has also joined NFU as a communications coordinator. Jerome is a recent graduate of West Virginia University.