A Weekly Update from the Red River Farm Network
Monday, December 13, 2021
Reporting Agriculture’s Business-Information is an important commodity. For farmers, timely and relevant information can determine whether the business is profitable or not. The Red River Farm Network’s focus is on the dollar-and-cents issues that impact agriculture. That may be market trends, the weather in South America or what’s happening with farmland values. RRFN is here to tell that story. Your feedback is always welcome. Contact don@rrfn.com, randy@rrfn.com, carah@rrfn.com or cierra@rrfn.com with your comments and story ideas.
Inflation Surges – The Consumer Price Index has reached its highest level in nearly 40 years for the second time in three months. At 6.8 percent, the CPI is an indication of inflation. Federal officials have blamed the rapid increase on factors connected to the pandemic and the supply chain crisis. Analysts expect the Federal Reserve to begin increasing interest rates by spring.
White House Links Packer Consolidation to Inflation – In a White House blog post, the Biden Administration has cited meat prices as a key factor for the higher rate of inflation. The blog says the increase in meat prices goes beyond supply and demand factors and is due to the lack of competition in the meatpacking industry. The North American Meat Institute responded, saying the White House is trying to shift blame for rising inflation.
Trade Deficit Tightens – Thanks to an increase in agricultural and energy exports, the U.S. trade deficit narrowed in October. The Commerce Department said the deficit in October totaled $67 billion, down from a record $81 billion in September. Imports have been put at a disadvantage due to the backlog at U.S. ports.
White House Continues to Push for Build Back Better Plan – President Joe Biden is expected to meet with West Virginia Senator Joe Manchin early this week to urge his support for the $2 trillion Build Back Better plan. The administration needs Manchin’s vote due to the 50-50 split in the Senate and the lawmaker is concerned about the cost of the bill. The Congressional Budget Office is estimating the current proposal would add $3 trillion to the federal deficit over the next ten years.
Gridlock Continues – AgCountry Farm Credit Services Vice President of Governmental and Public Affairs Howard Olson spoke at the Minnesota Canola Symposium, saying he expects the impasse to continue on Capitol Hill. “There are a lot of things going on in Washington D.C., but at the same time, not much happening it seems.” The Senate and House are evenly divided. Congress passed the continuing resolution and infrastructure bill, but the fate of the Build Back Better Act remains uncertain. Olson said tidal waves are still coming for agriculture. “It’s mostly climate initiatives, renewable diesel and there’s a number of other things to get ready for as well.”
A Shift in the Majority – Farm bill field hearings are expected to begin in the second half of next year. With it being an election year, agriculture committee leadership could change midstream. With the current margins in Congress, agricultural lobbyist James Callan anticipates a change in the majority. “Of course, we’re 11 months away, but historically, in the midterm election of a president’s first term, his party loses seats,” said Callan. “Some times it goes the other way, but very infrequently. With more retirements from Democrats than Republicans and other numbers I’ve seen, it appears the Republicans are poised to retake the House.” Callan, who participated in the Prairie Grains Conference, said input costs and supply chain issues are the biggest concerns he’s hearing from farmers.
Farm Bill Debate on the Horizon – National Association of Wheat Growers CEO Chandler Goule says the farm bill will be a priority when wheat growers meet at the Commodity Classic in March. “Between the WHIP+ program being passed and the big reconciliation package, how do we pull that together to make sure we are able to implement and get good programs out to wheat growers across the country?” Goule thinks it’s important to work with the Congressional Budget Office to figure out how to add the conservation money from the Build Back Better Act to the baseline of the next farm bill. “I think there’s a major lift protecting what we currently have, but having that additional money would help increase reference prices and add to the climate priorities of the current administration.”
Wiesemeyer: Farm Bill Extension Anticipated – Pro Farmer analyst Jim Wiesemeyer anticipates an extension of the current farm bill when the older policy expires in 2023. “The House is likely going to be controlled by Republicans in 2023, so why would the Republicans on the House Ag Committee want to go too far in coming up with a new farm bill?” Secretary Tom Vilsack increased food stamp funding by a quarter trillion dollars in August. Democrats are trying to add another $70 billion for climate and debt relief in the Build Back Better plan. That would make the new farm bill more than $1 trillion. “An extension is even likely if the Democrats keep control. Up to 90 percent of the farm bill is already nutrition spending. Farm groups are also beginning to tell me they want to improve the farm safety net due to the high costs of production outstripping support levels.”
EPA Proposes Blending Requirements, Denies 65 Small Refinery Exemptions – The EPA released their proposed draft rule for 2020, 2021 and 2022 blending requirements. EPA’s proposed 2020 volumes are at 17.1 billion gallons. This includes 4.63 billion gallons of advanced biofuels and leaves more than 12 billion gallons for conventional biofuels, like ethanol. The EPA increased 2021 volumes at 18.5 billion gallons, with 5.2 billion gallons of advanced biofuels and more than 13 billion gallons of conventional biofuels. The 2022 volumes boost the total, advanced and conventional targets with more than 20.7 billion gallons total. There’s 5.7 billion gallons of advanced biofuels required to blend into the fuel supply for 2022. The EPA will also deny 65 pending Small Refinery Exemption applications. In a statement, EPA Administrator Michael Regan said this package will allow the agency to get the RFS program back in growth mode. This announcement is getting mixed feedback from the biofuels industry.
One Step Forward, Two Steps Back – Biofuel groups say EPA took a positive step forward in addressing small refinery exemptions with this past week’s announcement, but there’s disappointment in the reduction of blending requirements. “First of all, 2020 blending requirements were already adjusted, because of the way the law is written. The EPA went in and further reduced that,” says Ron Lamberty, senior vice president, American Coalition for Ethanol. “That essentially says what we’ve already lost and what’s part of the law isn’t enough and we need to take another hit. The EPA also changed the 2021 number, starting it lower than what we’re projected to sell this year.” Lamberty expects a 90-day public comment period to follow. “Now, the devil’s in the details. We have an opportunity to try and change those details.”
USDA Unveils More Details of COVID Biofuel Relief – At the same time the EPA announced its blending requirements, the USDA released more details about their COVID relief plan for the biofuels industry. USDA is providing $800 million to support biofuels producers and infrastructure. The majority of that money will be used for pandemic relief and the application window will open in the next week. The remaining $100 million will be used to increase the sales and use of higher blends of bioethanol and biodiesel by expanding infrastructure for renewable fuels. Read more.
Supreme Court Asked to Review E15 Usage – In a legal brief filed with the Supreme Court, the Environmental Protection Agency has asked the High Court not to intervene in the battle over 15 per cent ethanol blends. Growth Energy is petitioning the court to review a lower court ruling and allow year-round sales of E15.
WOTUS Definition Published in Federal Register – The Biden Administration has published its rule defining the Waters of the United States rule in the Federal Register. Last month, the EPA and Army Corps of Engineers said it planned to repeal the Navigable Waters Protection Rule established during the Trump presidency. This latest action kicks off a 60-day comment period about the controversial rule.
Double Check NRCS Wetland Determination Maps – Last year, USDA adjusted the wetland determination process. Minnesota-based Rinke Noonan Law attorney Kale Van Bruggen says famers can recertify wetland determinations or request changes. NRCS wetland determination maps are also connected to the EPA’s Waters of the United States Rule. In 1993, the EPA and Army Corps of Engineers added a prior converted cropland exemption to their WOTUS definition. Under the WOTUS jurisdiction, acres determined to be prior converted cropland could not be wetlands. “The current administration released its pre-publication version of the rule that it’s going to be an issue. That draft will retain the prior converted cropland exemption. It’s important for farmers to determine if that applies to them and get those maps corrected now. If they are prior converted cropland acres, farmers can use that to prove to the agencies those aren’t subject to WOTUS.”
No Timeline for Dicamba Registration Decision – A meeting this past week in Alexandria, Virginia brought together the EPA, state pesticide regulatory officials and the agriculture industry. The fate of dicamba was discussed. A senior EPA official said the agency has not made any decision regarding the registration of XtendiMax, Engenia or Tavium. A representative from the Office of Pesticide Programs said EPA understands farmers want to know the dicamba rules for next year, but there is no timeline for that decision. Meanwhile, EPA is still reviewing reports of off-target dicamba injury from this past growing season.
MDA Announces State-Specific Dicamba Regs – The Minnesota Department of Agriculture is working with EPA and registrants to set new dicamba application cutoff dates for 2022. Below Interstate 94, there will be a June 12 cutoff date and above that line, there will be a June 30 cutoff date. Minnesota Ag Commissioner Thom Petersen made the announcement at the Prairie Grains Conference and joined RRFN for the Agriculture Today broadcast to offer more details.
S/D Estimates Updated – USDA left corn ending stocks unchanged at just under 1.5 billion bushels. The trade was expecting increased corn usage, due to ethanol, but that may have to wait until the January report. The soybean carryout was also left unchanged at 340 million bushels. A reduction in exports resulted in a small increase in the U.S. wheat stocks situation. South American production estimates also saw minimal change.
December USDA Report “As Expected” – Summit Commodities market analyst Tim Marsh says the December USDA report was as expected. “It’s not unusual for the USDA to hit reprint for the supply and demand report on corn and soybeans. We don’t have an updated crop production report for U.S. corn and soybeans in December, only updated demand numbers.” Taking a closer look at the wheat supply story, Marsh says the world carryover on wheat went up about 2.4 million tons from what was reported in November. “U.S. prices are high enough where export sales of U.S. wheat for this time of the year is the worst it’s been in 40 years.”
What’s Hot, What’s Not in the Markets – Advance Trading Risk Management Advisor Tommy Grisafi offers his thoughts on the corn market, exports and supply chain issues in this week’s edition of What’s Hot, What’s Not in the Markets.
Uncommon Partnerships Support Soybean Crush – Numerous soybean crush plants are being proposed nationwide, including the proposed plants in Spiritwood and Casselton, North Dakota. During a U.S. Soybean Export Council market outlook briefing, USSEC Vice President of Market Intelligence Mac Marshall credits the development of the renewable diesel market. Marshall is excited to see the “uncommon partnerships between the petroleum fossil fuel-based energy space and the crush world of the oilseed processing space.” That includes the collaboration between ADM and Marathon Oil in Spiritwood. Policy changes have favored the development of the renewable diesel market, but Marshall is more excited to see the private sector investment in soybean crushing.
House Passes Ocean Shipping Reform – The House has overwhelmingly passed a major overhaul of federal regulations for the shipping industry. This bill requires ocean carriers to certify that demurrage charges meet federal standards and prevents them from unreasonably declining U.S. exports. South Dakota Congressman Dusty Johnson is the lead sponsor of this bill, which is designed to address the current supply chain crisis.
Rural America Disadvantaged by Supply Chain Logjam – During a Commerce Committee hearing, Minnesota Senator Amy Klobuchar detailed the impact supply chain disruptions are having on agriculture. Klobuchar said Minnesota farmers have seen a 47 percent decline in exports since the pandemic began. At the same time, ocean carriers have reported record profits. The cost and availability of containers for export is one issue. “It currently costs seven times more to ship an export from California to China than to ship that same product from China to California.” Klobuchar said rural businesses are often located far from transportation hubs, making it difficult to access international markets. Klobuchar and North Dakota Senator John Hoeven have introduced the Promoting Rural Exports Act to assist rural businesses in pursuing the export market.
Rising Production Costs Add to Decline in Ag Economy Barometer – The sharp increase in production costs combined with fluctuating crop and livestock prices, changing environmental and tax policies along with COVID uncertainties are impacting a farmer’s outlook on the economy. The November Purdue University/CME Group’s Ag Economy Barometer declined by five points from the previous month due to pessimism from farmers in the near and long-term. Forty-three percent of farmers taking the monthly survey expect farm input prices to increase by more than 16 percent in 2022. In addition to rising fertilizer costs, farmers also face price increases for farm machinery, seed and fuel prices.
Ag Alliance Asks for DOJ Investigation – The Family Farm Action Alliance is asking the Justice Department to investigate the current upswing in fertilizer prices to determine if it is due to market manipulation by fertilizer companies. There are four companies that dominate the North American nitrogen fertilizer business, CF Industries, Nutrien, Koch and Yara. The Family Farm Action Alliance says these four companies control 75 percent of market.
A Critical Time for Fertilizer – The next six weeks will be critical for fertilizer. AgResource Company President Dan Basse made those comments during the American Seed Trade Association’s Seed Expo on Tuesday. “As we turn the calendar to 2022, it’s important to see an elevated flow of potash, nitrogen or DAP heading to ag storage facilities and distributed to the interior. If that doesn’t happen in this timeframe, it puts us in a position where I don’t think we can move enough inputs to cover our needs for spring planting.” Basse says it’s too early to know if there will be shortages, but the next month-and-a-half will determine overall fertilizer supplies.
Many Dynamics At Play in the Fertilizer Market – Fertilizer prices are driven by global supply and demand factors. The Mosaic Company Senior Vice President of Government and Public Affairs Ben Pratt says that’s especially true for phosphate. “Most notably, with a shortage of supply to meet demand, some countries have stopped letting producers export phosphates. China is an example and that’s put a crimp on supply, driving prices everywhere.” U.S. farmers are concerned about possible fertilizer shortages. The National Corn Growers Association would like the Mosaic Company to lift their tariffs on phosphorous fertilizer imported from outside of the United States. Pratt says the countervailing duties imposed on Morocco and Russian fertilizer producers earlier this year aren’t impacting U.S. phosphate prices at this point.
MN Wheat Minute – Minnesota Wheat CEO Charlie Vogel talks about the Prairie Grains Conference in this week’s Minnesota Wheat Minute. Hear the update.
FCA: Loan Quality is ‘Very Good’ – The Farm Credit Administration has received its quarterly report on the farm financial situation. Farmland sales remain strong with bankers reporting double-digit gains for cropland. Loan quality is described as ‘very good,’ but challenges continue for certain areas. Export demand is strong, but that is being offset by high input costs. In addition to fertilizer and certain chemistries, farm equipment and parts have been difficult to secure. The report said the supply chain bottlenecks may not fully recover until 2023.
CoBank Looks at the Year Ahead – CoBank has released a comprehensive forecast for the year ahead. A dysfunctional supply chain and inflation will continue to be an issue. CoBank economists do not expect any significant pull-back in farm-level costs until the third quarter, at the earliest. Direct government farm payments are expected to drop off next year, which will further squeeze the balance sheet. CoBank says exports to China will be the wildcard for U.S. agriculture.
Action Taken on the Cattle Contract Library Bill – A bill designed to bring transparency to the cattle market is on the way to the U.S. Senate. The Cattle Contract Library bill passed Wednesday in the House with a 411-to-13 vote. Cattlemen currently do not have access to the contract terms offered by packers, leading to less leverage for small producers.
Ensuring Fair and Competitive Markets – National Farmers Union President Rob Larew says a campaign focused on competitive markets will continue to get attention on the national level in 2022. “We continue to see a culmination of efforts from states on the Fairness to Farmers campaign. We expect that to be a topic as our members meet at the national convention in Denver next year.” Larew talked about competitive markets and supply chain issues with North Dakota Farmers Union members on Saturday. “Not only are we talking about supply chain problems, but the fact that we have near-monopolies in so many parts of agriculture. This has a huge impact on producer’s costs. We need to make sure markets are functioning and farmers are getting a fair price.”
Red Angus Eligible for Angus Branded Beef Programs – The Red Angus Association of America completed negotiations with the USDA for the breed’s Live Animals Specification Form that would allow them to be included in Angus-labeled beef programs. Cattle can qualify for the breed influence specifications by meeting genotype or phenotype requirements. Red Angus Association of America CEO Tom Brink says it’s a huge step for the breed. “I think it’s a good development for the industry because the industry really needs to move beyond superficial value estimates and that is what hide color is. It really doesn’t tell us much about cattle anymore. Maybe there was a day 20 years ago where it meant something more than what it means today, but we have a lot better tools at our fingertips in terms of objectively valuing groups of feeder cattle, whether that is genetic history, health information, the program that they’re involved in, or genomic information.” Red Angus Association of America President Steve Koester says it should help increase demand for Red Angus genetics. “Tom Brink and the USDA did a fantastic job at negotiating the wording on the form for officially recognizing Red Angus as Angus now phenotypically as well as genotypically. As more and more Angus brands start accepting Red Angus cattle, it gives the breed the opportunity to showcase their superior genetics, whether that’s through feedlots, packers, and ultimately the consumers.
MN Beef Update – In this week’s Minnesota Beef Update, Minnesota Beef Council Director of Industry Relations Royalee Rhoads looks back at the Minnesota Cattle Industry and Trade Show.
Dairy Margin Coverage Sign-Up Begins Today – Sign-up for the 2022 Dairy Margin Coverage Program begins today. The USDA expanded the program, allowing farmers to enroll supplemental production. There are also updates to feed costs. “One of the changes we were able to make is to allow 100 percent of the costs of premium alfalfa hay for producers starting now, going forward,” said Zach Ducheneaux, administrator, Farm Service Agency. “There’s also a retroactive component that goes back to January 2020 to accommodate producers going through challenges.” In an interview, Ducheneaux told the Red River Farm Network the USDA should be able to reach more dairy farmers with these changes. The FSA paid out more than $1 billion in 2021’s DMC program. The sign-up period runs through February 18.
Pleased with 2022 DMC Changes – Minnesota Milk Producers Association is glad to see changes made to the 2022 Dairy Margin Coverage program. Executive Director Lucas Sjostrom says Minnesota farmers pushed for these changes. “We’ve been pushing for supplemental changes for years. If you built a new farm from scratch after you’re fully enrolled in the DMC program, but if you add another partner to the farm or you double the herd, you got no credit for that. It was a disparity that hurt family farms. In the final days of 2020, Congress finally granted a DMC supplemental base increase, giving those who’ve grown incrementally 75 percent of their base increase since 2014.” The USDA also updated their feed cost formula. “Dairy farmers use premium hay, so it allows the feed cost adjuster to be raised. We’re glad to see this finally be implemented.”
A Time of Growth for North Dakota Farmers Union – North Dakota Farmers Union President Mark Watne says NDFU doubled its assets in the last eight years. That growth is due, in part, to insurance and the Founding Farmer restaurants, but also the demand for protein. “Farmers Union Industries, the group of five states including North Dakota, Minnesota and South Dakota, all share in those earnings. We have equal ownership of the vast majority of the company and the Central Bi-Products rendering plant.” NDFU is also tracking value-added agriculture opportunities in North Dakota. At this time, Watne says there are five soybean crush facilities being considered in the Dakotas and Minnesota. He believes renewable diesel will be an important market in the future. “Soybeans will lead and then, canola and sunflower products can be used. This will be the next demand carrier.”
NDFU Adopts Three Special Orders of Business – The North Dakota Farmers Union met over the weekend to set policy priorities and adopt three special orders of business for 2022. The special orders of business will be the legislative priorities for NDFU in 2022. “The three big issues we heard from our policy and action committee are market competition, the challenges we have with supply chains and then, the conversation around climate change and where farmers and ranchers fit into that,” said Matt Perdue, government relations director, NDFU. At the annual convention, NDFU also elected 42 delegates to attend the National Farmers Union Convention in February.
Bonnie Talks Disaster Aid, Climate Change with NDFU – USDA Under Secretary of Farm Production and Conservation Robert Bonnie joined the North Dakota Farmers Union Convention virtually last week. Bonnie talked about climate change and drought. “We are trying to improve current programs to help farmers, but there’s more work to do. Congress provided $10 billion for drought assistance. We’re looking for ways to move those resources quickly in the coming weeks.” Bonnie outlined USDA’s approach to promoting climate smart agriculture. “The overriding principle is this must work for agriculture. We have to build tools folks can integrate into their operations that work for them and we have to do that by providing incentives, market opportunities and de-risking the decisions to adopt those practices. Whatever we do on climate must be voluntary and collaborative.” Bonnie said USDA will also tap into existing programs. The USDA is building in a soil carbon monitoring program into the Conservation Reserve Program.
South Dakota Farmers Union Meets This Week – The South Dakota Farmers Union will hold their 106th state convention on Thursday and Friday. “We have a great line-up of speakers coming,” says Karla Hofhenke, executive director. “We have FSA Administrator Zach Ducheneaux, Risk Management Agency Administrator Marsha Bunger and we’re also having a panel discussion on hemp.” The 2021 drought may also get attention. “It wasn’t good in 2021. We got a few inches of rain in the fall, but we’re not over the drought yet. Heading into 2022, farmers and ranchers are concerned drought could linger. We need more moisture,” says Hofhenke. “Navigating dry conditions will be a challenging in the new year. We’re trying to help farmers make the best decisions possible by giving them much-needed resources.” The South Dakota Farmers Union Convention will be on Thursday and Friday in Huron, South Dakota.
Noem Outlines Budget Plan – Fiscal responsibility was an ongoing theme in South Dakota Governor Kristi Noem’s annual budget address. Noem said South Dakota has the strongest economy in America and said there will be no tax increases. “Remember, there isn’t a dollar the government spends that doesn’t come from somewhere. It’s money that’s taken from a paycheck or a small business or from a family farm. It’s money that didn’t get saved, that didn’t get invested, that didn’t create a new job.” Investments will be made in infrastructure, workforce training and a pay bump for state employees.
MFBF Minute – Minnesota Farm Bureau Federation was part of the Prairie Grains Conference last week. Hear more from board member Shayne Isane in the latest MFBF Minute.
Budget Surplus in MN Economic Outlook – The Minnesota Office of Management and Budget is projecting a $7.7 billion budget surplus for the 2022-2023 biennium. Governor Tim Walz said this is an opportunity. “I heard it throughout our trade mission to the UK and Finland that they want to invest in states that are working and building to the future,” said Walz. “Companies in both the UK and Finland said they will not invest in states that are not moving toward providing renewable energies and a sustainable economy for the future.” Read more.
Drought Aid for MN Ag Worth Pursuing in 2022 – The odds of a special session for the Minnesota Legislature are dwindling as the regular session approaches. Representative John Burkel says special sessions are special for a reason. “There are many moving parts. I’m hoping we could put something together for front-line workers and agriculture ahead of Christmas, but I’m not holding my breath.” Special session or not, Burkel says pursuing drought relief for Minnesota farmers is worthwhile, especially for livestock producers. “Catching timely rains this fall helped crop growers, but there are still pockets of the state really dry. The CRP situation didn’t get resolved in a timely manner and there are still issues getting hay. Whether it’s $10 million or not, there’s still a conversation to be had for a drought package.”
Redistricting Discussions Happening in MN – State lawmakers are working on redistricting in Minnesota. East Grand Forks, Minnesota-based Senator Mark Johnson is involved in the process. “The House and Senate have been having hearings on redistricting across the state. The court is also doing a parallel process, because for the past 50 years, the court determines the final lines with input from the Legislature. We have until February 15 to do this and it will be interesting to see the impact on rural Minnesota.” As rural Minnesota’s population gets smaller, that means bigger districts and smaller representation in Saint Paul. “The proposals are all over the board right now and nothing is official. Our redistricting will be determined in 2022.”
Playing Defense in St. Paul – The governor and members of the state House and Senate will all be on the ballot in Minnesota in 2022. Agricultural lobbyist Bruce Kleven says that will have an effect on the work done in the legislative session.”I don’t think it will be a productive session because of that and redistricting will loom large.” Redistricting will likely reflect population loss in western Minnesota and growth in the urban area, primarily in the third-ring suburbs. Regarding farm policy, Kleven expects agriculture to be playing defense. “There may be a drought package, but it is getting late for that since we needed it in July. Policy-wise, we always keep a close eye on chemical attacks and the use of our products, treated seed was a big discussion last year.”
The Drought Will Leave a Scar – North Dakota farmers and ranchers will remember 2021 as a year of widespread drought. NDSU Extension State Climatologist Adnan Akyuz says the drought will leave a scar. It set records in North Dakota. “It’s comparable to 1936 and 1988, but in terms of the drought intensity, it’s the highest since 2000. In terms of that, it’s a record. It also broke a record in terms of the highest drought level, D4, starting in May. It was also the largest extension of exceptional and extreme drought.” The latest U.S. Drought Monitor still shows areas of extreme drought in North Dakota, but Akyuz says most of the state received good soil moisture this fall. Heading into winter, there’s a good start, but there’s still a lot of winter left. “I’m cautiously optimistic that the winter is unfolding how it’s supposed to. We are in a La Nina and we could have above normal precipitation.”
Soil Moisture Improved in Last Quarter for North Dakota – Soil moisture is above average in much of the Dakotas and Minnesota heading into 2022. “We had a lot of rain in early September, took a bit of a break and then, had incredible rains in October. Many folks had an autumn’s worth of rain in October,” says Daryl Ritchison, director, North Dakota Agricultural Weather Network. “Then, we had another good rain in November before the ground froze. We’re sitting pretty good right now with one exception in northwestern North Dakota. The rest of the region will start 2022 really well.”
Dry Conditions Remain a Concern in Western ND – Rains came through western North Dakota in late October, but Syngenta Agronomy Services Representative Nathan Popiel doesn’t think it was enough to alleviate the dry conditions. More moisture is needed in the west. “We’re still seeing extreme dryness. There are many concerns that come with dryness. I always tell farmers to plan for the best. Snow always helps improve morale, but I think it will take a fair amount of snow to replenish the lakes, potholes and things like that. Hopefully, we can get some subsoil moisture.” Popiel says several farmers are waiting to make acreage decisions. “There’s good commodity prices, but high fertilizer prices. Then, we’ve got the dry situation. There may be different carryover concerns from what there would be normally.”
Focus on Hybrid and Variety Selection – Positive returns in crop production begin with the seed. Channel Agronomist Morgan Schmidt wants growers to spend time focusing on hybrid and variety selection. “Products that perform under stress, products that perform well when it rains or products that fit broad acres, that’s part of our risk management plan.” Agronomic management practices should also be considered “to help conserve soil moisture or give us more ear flex. That will push yields at the end of the year.”
An Advantage for Regional Seed Companies – There are plenty of choices as farmers finalize their crop mix for the year ahead. “It’s going to be corn and soybeans in a lot of areas, but we’re seeing more interest in wheat, canola and sunflowers,” said Jeff Hamre, sales manager, Proseed. Hamre says there are advantages to being a regional seed company. “We raise the seed ourselves so we know what we’ve got. It was a good crop for seed production and we have ample seed in our warehouse right now.”
Corn Matters – The MN Ag Expo is coming up in January. Hear more from Minnesota Corn Growers Association Northwest District Field Manager Marlene Dufault as she previews the event in this week’s Corn Matters.
Be Alert for SDS and SCN – Sudden Death Syndrome was confirmed in Minnesota in 2002 and in North Dakota in 2018. By 2020, it was found as far north as Cavalier, North Dakota. BASF Seed Treatment Representative Tracy Hillenbrand says there are two phases to the disease. There is a root rot phase that is often confused with brown stem rot. “If you cut the plant open, you’ll see with SDS the pith is still tan and healthy looking while with brown stem rot it is mushy,” said Hillenbrand. “The plant will move from root rot phase to the foliar phase in late August and appear that the soybeans are turning and getting ripe.” A key indication of SDS is yellow spots on the leaves. As it progresses, the leaf will turn yellow with green veins. BASF’s ILEVO Seed Treatment protects soybeans from SDS and soybean cyst nematode.
Drought Adds to Wheat Research Findings – In 2021, the moisture stress highlighted how seeding rates can affect plant-to-plant competition. “We saw the lower seeding rate did better this year, because it wasn’t competing with other wheat plants for soil moisture,” says Missy Carlson, vice president of research, Minnesota Wheat. “That’s something to think about. If you’re seeding at a higher rate, you could be competing with yourself for available soil moisture.” Carlson recommends growers stay within 1.3 to 1.4 million plants per acre when seeding spring wheat in 2022. “We don’t know what the season will be like, but if you’re seeding at a higher rate, around two million plants per acre, you should be safe knocking that back down to the university recommendations.” Carlson was part of the On-Farm Research Summit.
More Barley Needed in 2022 – Barley supplies are tight following the dry growing season in North Dakota and Minnesota. Anheuser Busch Agronomy Manager Nikki Zahradka says there will be enough barley to get through the year for brewing, but rebuilding inventory will be a priority for 2022. Grower contracts are out for next year and farmers are interested. “With fertilizer prices the way they are, barley doesn’t use as much as other crops like wheat and corn. Barley is also more drought tolerant,” says Zahradka. “We are trying to spread ourselves out as geographically as we can to make sure we cover all corners of the state. Mother Nature likes to throw curve balls.” Seed supplies will be tight for next year. Seed should be locked in early. “There are rumors in other regions of the state, they’re already sold out.”
Pet Food: A Growing Market for Barley – The majority of the barley produced in North Dakota goes toward malting and brewing, but 20 to 30 percent of the state’s barley is going to another market: pet food. “It’s been a surprise to see the growth in the sector for the past three to four years.” North Dakota Barley Council Executive Administrator Steve Edwardson says manufacturers are starting to revitalize the use of barley in their pet food recipes. MGI Grain Processing Senior Vice President of Sales and Business Development Kevin Pray says barley offers a nutritional value, a health-halo ingredient, for cat and dog food. Local barley growers are willing to explore the market. “For us to see the interest we’ve seen so far, we’re relatively small in the overall space, but we’ve had strong interest. This option allows farmers to diversify their crop base and can offset their cost of production issues. Feed and pearling can be more flexible and we can work with different varieties.”
Canola Minute – The 24th annual Canola Expo is happening this week. Learn more from Northern Canola Growers Association Executive Director Barry Coleman in the latest Canola Minute.
Winter Canola for the Northern Plains – Winter canola is a hot topic for canola growers in the Northern Plains. Minnesota Canola Council board member Rob Rynning says this has been years in the making. “Our board’s funded research efforts on this for years and now, varieties are getting to a point where we may actually get winter canola.” Winter canola can benefit farms. “It takes off earlier and you can get two to three weeks more growing season on the front end, because it starts growing much earlier than spring canola. It beats the summer heat so you can have nice, cool weather to set pods and flowering. There are also real yield advantages.”
Canola Expo is Tomorrow – The Northern Canola Growers Association will host the annual Canola Expo on Tuesday in Langdon, North Dakota. NCGA Executive Director Barry Coleman says new canola planting innovations will be discussed. “In the last few years, the growers planting corn and soybeans have been experimenting with planting canola with those planters, not just drills. We’re going to hear success stories from people using planters, different row widths and different seeding rates. It will be an interesting panel from growers across North Dakota.” The keynote speaker is market consultant Mike Krueger. “We’ll be talking about the renewable fuel revolution happening and how that affects oilseed markets.”
Dry Bean Scene – During the Prairie Grains Conference, there was a focus on white mold management. Find out more in this edition of the Dry Bean Scene, sponsored by Northarvest Bean Growers Association.
The 2022 Potato Expo is Coming Up in January – The 2022 Potato Expo will be in person. National Potato Council Vice President of Industry Relations and Events Hollee Alexander says relationships are important in the potato industry. This year’s expo is all about making the potato industry’s business more vibrant and re-engaging with others. The schedule is similar to previous years with a trade show, potato talks and breakout sessions. “It will be an experience attendees are familiar with with the exception of a few modifications.” That includes no keynote lunch speaker. The National Potato Council will also not be meeting in conjunction with the Potato Expo. CEO Kam Quarles says the annual meeting is now connected to a Washington D.C. Summit held in February/March. That doesn’t mean there won’t be breakout sessions on farm policy and how that affects business. “We’ve been working closely with Potatoes USA to have an economics team look at all of the issues surrounding inflation and the supply chain. They’ll roll out a study on what the potato industry can expect for input pricing and availability in 2022.” The 2022 Potato Expo will be held on January 5 and 6 in Anaheim. Hear more.
Beet Stock Snapshot – Last week, there was one brokered American Crystal Sugar Company beet stock sale for 50 shares at $4,300 per share. “The market has been quiet the past few weeks with minimal activity,” said Jayson Menke, broker, Acres and Shares.
Correction – American Crystal Sugar Company’s final 2020 crop/fiscal year 2021 shareholder payment is $60.58 per ton.
Minn-Dak Recaps ’21 Campaign – The Minn-Dak Farmers Cooperative forecast an initial net payment of $44 per ton for the 2021 sugarbeet crop. That’s 15 percent higher than the final payment of last year. The crop averaged just over 31 tons per acre with a sugar content of 17.6 percent.
Fielding Questions – In the Fielding Questions podcast, AgCountry Insurance Specialist Joel Lysne talks about managing risk through multi-peril crop insurance. Every farmer has a different tolerance for risk. Coverage levels have changed in recent years and Lysne discusses that and more in this week’s podcast.
RIPE Program Offers Climate Solution for Farmers – The North Dakota Grain Growers Association recently joined the Rural Investment to Protect Our Environment. First Vice President Ed Kessel says the non-profit program pays farmers to grow cover crops. “Some of the conservation programs out there penalize early adapters. If you already plant cover crops or are implementing conservation practices, you don’t qualify for it. This is a program that allows farmers to plant a cover crop, certify that cover crop and submit for payment through the FSA office. There’s currently $100 an acre proposed.” Kessel says this is a flexible option for farmers. “You just sign up for acres. With rotations in my area of North Dakota, we can’t plant cover crops on every acre, it just doesn’t work. Being able to have flexibility to cover more than your costs is important.”
Explore the Carbon Markets – Land O’ Lakes Truterra LLC paid out $4 million to farmers for 200,000 tons of carbon stored during the first year of its carbon program. Field Team Leader Mariah Murphy says signup for the 2022 program is open. “Farmers can go to the Truterra website and they’ll find a quick survey. If you qualify, you’ll know within 48-hours what the next steps may be or you can reach out to a participating retailer.” Participating farmers are eligible for a one-time payment of $2 per acre. “These farmers were probably already making that transition. This is more of an incentive for them to continue on that path or explore the path of a carbon program. This is a way for them to get baseline data in the system and take a look at soil samples we would capture.” Hear the story.
Industry’s First Digital Carbon Footprint Measurement Program for Agriculture Announced – Bayer, Amazon Web Services and Fargo-based Bushel are working together to help farmers capture value from the carbon market. While there has been a focus on climate solutions, the ability to have metrics that trace back to the farm have been a hurdle. Bushel CEO Jake Joraanstad says Project Carbonview now digitizes this process. “Now, all we have to do is show the field where they did that work and the output of that grain is delivered to the facility; we’re basically tying a scale ticket to a field record.” Initially, this effort will help ethanol producers track carbon emissions from planting through production. This initiative may expand to soybean crush plants, grain milling operations and similar businesses in the future. “These plants spend millions of dollars per year to get a small, small quarter-of-a-percent efficiency gains that they can take to California Carbon and say here’s what we’ve done, but it’s all in the processing side. Nobody has looked hard at tracking inbound grain and if the farmer is doing a great job and there should be benefits if they are.” Eligible farmers who enroll in the pilot project will be paid for their participation. Ultimately, the goal is to incentivize the adoption of climate-friendly practices, such as low-till or no-till farming, creating new revenue streams through the emerging climate market.
Support for Smart Integrated Multi-Product Prescription Application System – AMVAC offers an after-market system that can be added to the planter, giving the farmer the ability to prescriptively apply multiple dry or liquid products while planting. Jim Lappin oversees the SIMPAS portfolio and uses iron chlorosis in soybeans as an example. “Those areas don’t move a lot from year-to-year, but they don’t affect the whole field,” said Lappin. “Does it make sense to spread incremental iron across the whole field when it only affects certain zones within the field?” Lappin sees an opportunity for growers to save input costs or invest in other yield-limiting agronomic issues within the field.
CME Group in Court With Former Traders – A legal battle between the CME Group and thousands of traders is continuing. This lawsuit claims the move to the electronic trading platform in 2012 negatively impacted the value of CME membership. The CME Group unsuccessfully tried to have the case dismissed and now the case may be certified as a class action lawsuit. If the plaintiffs are successful, it is estimated the damages could be in the hundreds of millions of dollars.
Jennie-O Turkey Store Closes One Plant – Hormel Foods will close its Jennie-O Turkey Store plant in Willmar, Minnesota during the first half of 2022. According to Hormel, the plant is an older, inefficient facility that produces products the company is shifting away from. Employees will transition to a newer and larger facility in Willmar that’s better aligned to meet company and consumer needs.
CNH Industrial and MacDon Partnership – Manitoba-based MacDon Industries has entered into a partnership with Case IH and New Holland for a line of co-branded draper headers. Case IH will have the draper headers available for order by early 2022. The New Holland brand will have the draper headers for 2023.
Cooperative Ventures Invest in New Ag Technologies – CHS and Growmark are working together on a separate entity called Cooperative Ventures. Each company has committed $25 million over ten years to invest in breakthrough technologies for agriculture. CHS Senior Vice President of Enterprise Transformation David Black says this is a massive undertaking. “For so many of these innovators, they may have a great idea but it has to be tested. Will that work in the field? Will that work at scale? Will that work as well in North Dakota as it does in southern Illinois? We can ground-truth or test those technologies in real-life conditions. It can be a real win.” Cooperative Ventures has identified three areas for investment: crop production, the supply chain and sustainability.
New USDA Staff Have Ties to Minnesota – USDA has announced the addition of four new staff members and two of them have Minnesota connections. Anne Knapke is the new deputy chief of staff for policy and Bidisha Bhattacharyya is the senior advisor for climate and conservation. Knapke has spent time as a legislative director for Minnesota Senator Amy Klobuchar. Bhattacharyya has been working as a policy advisor at the Farm Service Agency, but also worked on the staff of Minnesota Senator Al Franken and Minnesota Representative Betty McCullum.
Barbre Takes on Role With RISE – Former Risk Management Agency Administrator Martin Barbre is the new vice president of engagement and government relations for Rural Investment to Protect our Environment. Most recently, Barbre has been the CEO of MyAgData.
SD Corn Comments – It’s important farmers stay connected with consumers. South Dakota Corn has a new campaign with a goal to educate consumers about farming. Learn more about the new campaign in the latest Corn Comments, a production of the South Dakota Corn Utilization Council.
New to the Hoeven Staff – John Altendorf is a new legislative correspondent in North Dakota Senator John Hoeven’s office. Previously, Altendorf was a staff assistant for Iowa Representative Ashley Hinson.
Gast Elected to USB Board – The United Soybean Board has elected its new leadership team. New York farmer Ralph Lott will serve as chairman. Matt Gast of Valley City, North Dakota was elected to the ten-member executive committee.
American Soybean Association Elects New Leadership – Arkansas Farmer Brad Doyle is the new president of the American Soybean Association, succeeding Kevin Scott of South Dakota. Josh Gackle of North Dakota was elected treasurer. George Goblish of Minnesota was also elected as an at-large member of the executive committee. Nine new directors began their terms, including three from Minnesota. That’s Jamie Beyer, Adam Guetter and Michael Petefish.
NSA Officers Reelected – The National Sunflower Association has reelected three members of its officer team. Lance Hourigan of Lemmon, South Dakota will continue to service NSA president. Colorado farmer Tom Kirkmeyer is the first vice president and Chuck Todd from Onida, South Dakota is the second vice president. ADM’s David Douglas is the newly-elected secretary-treasurer.
MMPA Installs Officer Team – During the Minnesota Milk Producers Association annual meeting, board members affirmed the current slate of officers. Shelly DePestel is president and Garrett Luthens is vice president. The MMPA secretary is Bob Dombeck and Rick Smith is the treasurer.
Bogue Joins SD Farm Bureau – Beresford, South Dakota native Matthew Bogue is the new State Public Policy Director for the South Dakota Farm Bureau. Bogue will represent legislative priorities of Farm Bureau in Pierre and throughout South Dakota. He interned at the South Dakota Legislature and for Governor Kristi Noem.
New Office Manager at Northern Plains Potato Growers – The Northern Plains Potato Growers Association hired a new office manager, Erin VanCamp. VanCamp is from Drayton, North Dakota and was the office manager at MarKit County Grain LLC in Argyle. VanCamp replaces former finance director Diane Peycke who recently retired.
Former CattleFax CEO Passes – Former CattleFax general manager and CEO Topper Thorpe has passed away. Thorpe was one of the first two employees of the startup company in 1968 and led CattleFax for more than 30 years.
Awards Presented to NDSU Extension Faculty and Staff – North Dakota State University faculty and staff have been recognized during an annual awards ceremony. The Larson/Yaggie Excellence in Research Award went to Plant Pathology Assistant Professor Guiping Yan. Plant Scientist Marisol Berti was awarded the Eugene Dahl Excellence in Research honor. Lamoure County Extension agent Julianne Racine was recognized for excellence in her early Extension career. The AGSCO Excellence in Extension Award was given to 4-H youth development specialist Dean Aakre.
NDGGA Awards Handed Out at Prairie Grains Banquet – The North Dakota Grain Growers Association has presented its Kernel Award to North Dakota Wheat Commission Administrator Neal Fisher and NDGGA Past President John Weinand of Hazen.
Last Week’s Trivia- Octagon is the shape of the STOP sign. Jared Oaches of AgCountry Farm Credit Services wins our weekly trivia challenge. Congratulations, Jared. Runner-up honors go to Harvey farmer Bill Ongstad, Anna Kemmer of Southeast Regional Career and Technical Center, Paul Sproule of Sproule Farms and Kevin Praska of Stone’s Mobile Radio. The ‘first 20’ rounds out with Karlstad farmer Kurt Aakre, retired feedlot officer Al Langseth, Christine Schmidt of Central Valley Bean Cooperative, Kent Braathen of Braathen Harvesting, Jim Altringer of CHS Dakota Plains, Bob Lebacken of RML Trading, Mike Trosen of Meadowland Farmers Cooperative, Dave Gehrtz of Proseed, Todd Good of AgCountry Farm Credit Services, Mark Bernard of AgroEconomics, Keith Rekow of Dairyland Seed, Nick Sinner of Northern Crops Institute, Sara O’Toole of O’Toole Seed, Peter Carson of Carson Farms, Brad Farber of Anglo American Crop Nutrients and Twyla Wulf of Clear Springs Cattle Company.
This Week’s Trivia- What is the first name of the character, Scrooge, in the novel ‘A Christmas Carol?’ Send your answer to don@rrfn.com.
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FarmNetNews is a production of the Red River Farm Network. RRFN is based in Grand Forks, North Dakota and provides news to farmers and ranchers across Minnesota, North Dakota and South Dakota.