June 13, 2008

Extension Update - from Stu Ellis

• Many reasons for a market downturn can be counted says IL Extension economist Darrel Good. Among them: CRP grazing allowed, declining crude oil prices, efforts by the US to strengthen the dollar, wheat prices becoming competitive with corn for livestock feed, and CFTC's announcement about speculative trading being investigated.
• None of those reasons could overcome the bullish strength of heavy Midwest rains and a sudden rise in crude oil prices, and Darrel Good says those altered the fundamentals for corn and soybeans. Particularly, the weather delays in finishing planting and the need for replanting reduces the potential size of both the 2008 corn and soybean crops he says. Read his newsletter: http://www.farmdoc.uiuc.edu/marketing/weekly/html/060908.html .
• The market will be watching the potential crop size over the next few weeks, but the strength of demand will determine price and the need for rationing. While Good doubts any US market intervention like other nations, he says beware of two possibilities:
  1) Initiatives to use the CRP for more forage for livestock or expand 2009 crop acreage.
  2) Change the Renewable Fuels Standard to reduce corn demand by ethanol refineries.
• USDA's Supply-Demand Report this week cut the corn yield projection by 5 bu. per acre to 148.9, but did not change the planted acreage estimates, despite extensive flooding. The Planted Acreage Report at the end of the month will provide USDA's perspective on the impact heavy rains. Corn prices were estimated at $5.30 to $6.30.
• USDA retained its yield and acreage projections for soybeans, despite the planting delays, but the June 30 acreage report will refine the numbers. Mike Woolverton at Kansas State says old crop bean stocks are projected at a 15 day supply, but that will rise only to a 21 day supply for the new crop, still based on earlier production estimates. The tight supplies are the reason USDA raised the farmgate price range to $11.00 to $12.50.
• Wheat yield projections were raised to 43.2 bu. per acre based on improved prospects for winter wheat says Woolverton, but ending stocks are still relatively low because of the demand for feed wheat and export demand. Farm prices will be $6.75 to $8.25. Read his newsletter at: http://www.agmanager.info/marketing/outlook/newletters/default.asp .
• Continued adverse weather will offer 3 choices to farmers with crop insurance, says Purdue economist George Patrick, who says agents need to be consulted about them:
  1) Replant the original crop, even though the yield will likely be reduced.
  2) Plant an alternative crop after the final planting date and late planting period.
  3) Abandon the acreage and take a prevented planting payment.
• Shorter maturity hybrids are becoming more popular because they would require fewer growing degree days, but when you are cut 300 GDD off your hybrid the trade off is a decrease in the higher yield typical for later planted corn says IL Extension Specialist Emerson Nafziger. He advises short season hybrids untested in your area may suffer disease and drought stress. Read: http://www.ipm.uiuc.edu/bulletin/article.php?id=957 .
• Nafziger is concerned about the biochemical needs of soybeans which trigger flowering. The length of darkness is key, but will be counter to what soybeans need when planted late. The biochemical process also has to occur at the V-3 stage in beans, which is the earliest that flowering can occur, and those two events may be mismatched this year.
• If soybeans flower early, the flowering period is much shorter and their height is shorter. A wet July or August can extend the growth and flowering period. Read more in Emerson Nafziger's newsletter at: http://www.ipm.uiuc.edu/bulletin/article.php?id=957 .
• Cut corn and bean yield projections in half if planting is not accomplished by late June, says Nafziger. "Even with high costs, the yield needed to cover costs is relatively low when corn is more than $6 a bushel. We're looking at some real disappointment at having so much income potential not realized this year due to weather-related crop problems."
• Seed beans are available for replanting say Iowa State agronomists. Plenty of group 2 is available, but lesser amounts of groups 1 & 3. Additional seed can be conditioned by seed companies to meet demand, but germination will still vary in the 80% to 90% range.
• Seed corn is also available, and companies are moving shorter maturity corn into areas where replanting will be necessary. Yields will only be 50% to 70% of normal, despite the maturity length of the hybrid. Crop insurance policies may expect replanting to be attempted to meet the "good farming practice" requirement, along with pesticides.
• Has your nitrogen washed away? Fertility specialist John Sawyer at Iowa State says the late spring moisture and warm soils increased the chance for loss. He uses the IL research of: 4-5% loss of nitrate-N by denitrification per day of saturated soil. He says more N is lost by tile flow, and would total about twice the typical annual loss. Read more: http://www.extension.iastate.edu/CropNews/2008/0611JohnSawyer.htm .
• If you are replacing failed corn with soybeans, Purdue agronomist Bob Nielsen says, "That while the choice to replant damaged cornfields back to soybeans is the prerogative of the grower, the risk of damage to the soybean crop from previously applied corn herbicides is borne solely by the grower because most soil-applied corn herbicides have more than a few months' crop rotation restriction on their labels." And he says soybean seed may be either in short supply or you may not get your first choice of seed beans. Visit: http://www.agry.purdue.edu/ext/corn/news/articles.08/FloodingReplant-0611.html
• Evaluate your possible damage from ponding by assessing debris, silt, and residue from other fields that enters the whorl of the corn plant suggests Ohio State's Peter Thomison. Even if water is not standing, saturated and soupy soils can injure the plant, along with:
  1) Stage of development, duration of ponding, plus soil and air temperature.
  2) If it does not kill the plant, ponding will retard root growth, and cause nitrogen loss.
  3) If ponding in corn lasts less than 48 hours, crop injury should be limited.
  4) Ponding will contribute to disease risks of pythium, corn smut, and crazy top.
• Keep your fingers crossed about reduced insect pressure on crops this spring:
  1) Armyworms in wheat are concerns in OH & IN, with some in southern IL.
  2) Only a few cases of significant bean leaf beetles in the earliest planted fields.
  3) Replanted corn will probably be more susceptible to black cutworm feeding.
  4) Corn borers are laying eggs in the tallest corn, but larvae won't survive in short corn.
  5) Japanese beetles are emerging but can't find pollinating corn or flowering beans.
  6) Soybean aphids have been found in uncommonly small colonies in MI, IN, OH, & IL.
• Ducks in cornfields probably indicate reduced populations of corn rootworm. The hatch is two weeks behind last year, with ponds and saturated soils contributing to their demise. IL entomologist Mike Gray doubts any high densities because of starvation from lack of corn roots, which may help you make insecticide decisions for fields needed replanting.
• However! Research over the past few years has indicated that standing water does not spell an end to corn rootworm. They can survive a pond lasting only a few days and grow up to inflict severe damage. A 1991 study at Urbana, IL, indicated enough corn rootworms survived a severely flooded research plot "to inflict impressive damage."
• On the other hand, corn nematodes which like sandy soils, are surviving quite well, thank you. If you have stunted oval patches of corn, it may warrant you to take soil samples and have them tested by a nematode lab, which is the only way to diagnose that problem. More: http://www.farmdoc.uiuc.edu/marketing/weekly/html/060908.html .
• In the physics of rain, drops range from 1 to 7 millimeters and hit the ground as fast as 20 miles per hour. When millions hit bare ground, soil particles are dislodged and may land 3 to 5 feet away. A heavy rainstorm may splash 90 tons of soil per acre, but most of it remains in the field and fills up pores in the soil preventing moisture absorption. More is at: http://www.ipm.iastate.edu/ipm/icm/2005/5-2-2005/reducespringerosion.html .
• Missouri's 30+ inches of rain from December to May turns out to be the wettest such period ever. MO climatologist Pat Guinan said the average is under 19 inches. Also, 60 tornadoes have hit, which is twice the yearly average. Guinan said the culprit is the above normal temperatures in the southern US and below normal temperatures in the northern US, and the large contrast in air masses results in more unstable weather.

Posted by John Fulton at 11:26 AM |