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Weekly outlook

Crop production

[SEPT. 10, 2002]  URBANA — The pattern of large crops, low prices and expanding consumption in the past three years has given way to small crops and reduced inventories, said a University of Illinois Extension marketing specialist.

"That shift suggests that the volatile prices of the past few years will continue but that prices may continue to trade at a higher level, at least for several months," said Darrel Good. "This price pattern will likely provide attractive prices for the 2002 crop and perhaps the 2003 crops.

"A conservative approach to pricing 2003 crops should be considered, given the uncertainty about crop size next year."

Good’s comments came as he reviewed continued uncertainty about crop production. The USDA will release the September forecast of U.S. corn and soybean crops, as well as the monthly updates of projections of world crop production and consumption, on Sept. 12. The projections of U.S. crop size will be of most immediate interest to the market.

Corn prices rallied sharply following the USDA’s August production report. On a closing basis, December futures moved from $2.615 to $2.8475. Late-August precipitation pushed that contract 18 cents lower by the end of August. By the close on Sept. 6, however, December futures had recovered to $2.8325. A new contract high of $2.96 was reached on Sept. 9.

"The latest rally was fueled by sharply higher wheat prices and some concern that late-season weather conditions may have trimmed yield potential in some areas," said Good.

"For the third consecutive year, the Midwest growing season has finished on a warm, dry note. While the market will react to the September production forecast, considerable uncertainty about crop size may persist into October and November."

In 2000, both the corn yield and production forecasts were nearly unchanged in September but declined in October and again in November. The November production forecast was 315 million bushels, or 3 percent, smaller than the August forecast. In 2001, the yield and production forecasts declined marginally in September but increased in October and again in November. The November production forecast was 280 million bushels, or 3 percent, larger than the August forecast.

Soybean prices also rallied following the USDA’s surprisingly small August production forecast. On a closing basis, November futures moved from $5.2525 to $5.73.

"As in the case of corn, late August rainfall pushed November futures to a close of $5.39 on Aug. 29," said Good. "By the close on Sept. 6, November futures were back up to $5.60, and that contract traded to $5.80 on Sept. 9.

"Late-season weather conditions, along with relatively large exports of soybeans and higher wheat prices, contributed to the higher prices of last week."

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The soybean yield and production forecasts in 2000 and 2001 followed a pattern similar to that of corn forecasts. In 2000, the yield and production forecasts declined each month from September through November. The November production forecast was 219 million bushels, or 7.3 percent, below the August forecast. In 2001, both the yield and production forecasts declined from August to September but increased in October and again in November. The November forecast was 56 million bushels, or 2 percent, larger than the August forecast.

"In addition to U.S. corn and soybean production forecasts, the market will also be interested in projections for spring wheat production in the United States, total wheat production in the rest of the world, corn production in China and soybean production in South America," said Good. "Last month, the USDA’s wheat production estimates revealed larger crops than in 2001-02 in Western Europe, India and Turkey. Smaller crops were expected in Canada, Australia, Argentina and Eastern Europe.

"For corn, the August projections revealed prospects for a much larger — nearly 10 percent — crop in China due to higher average yields than in 2001. Some observers expect that the projection will increase this month. The USDA has projected a 7.4 percent increase in South American soybean production in 2001, reflecting a 6.5 percent increase in acreage and an 0.8 percent increase in average yields. The size of both the Chinese corn crop and the South American soybean crop will influence the export demand for U.S. crops during the 2002-03 marketing year."

Good noted that unless U.S. and world crop projections are much larger than now expected, supplies will be relatively tight during the 2002-03 marketing year. U.S. and world stocks of coarse grains, wheat and soybeans are expected to decline significantly by the end of the 2002-03 marketing year.

"At this juncture, however, supplies are expected to be large enough to sustain world consumption at current, or even higher, levels," he said. "While consumption of U.S. soybeans, and perhaps feed grains and wheat, will have to be reduced, it now appears that world consumption will not have to decline.

"That scenario could change, depending on how crops in the Southern Hemisphere develop. In addition, the expected low level of inventories means that prices will be very sensitive to the prospective size of the 2003 crops in the Northern Hemisphere."

[U of I news release]

When is it fall?

[SEPT. 9, 2002]  Fall doesn’t officially start for another week and a half or so, but several of the signs tell us that fall is here. We have had some geese flying south, the woolly bear caterpillars are crossing the road, the cicadas have been singing for six weeks now, and the combines are starting to pick around in some cornfields. Fall is when harvest comes about in my mind.

Now the producers out with the combines are looking for a patch of drier corn to start on, taking out some corn that has blown flat in a windstorm or is at high risk for going flat or losing ears from European corn borer damage.

Let’s face it. Most people wouldn’t want to give away much of their product value in drying costs. Corn is still valued at "mediocre" values, around $2.50 per bushel. Most commercial elevators are charging about 2 cents per bushel per point of moisture. With 30 percent moisture corn needing to be dried to 15 percent moisture for fall sale, this means 30 cents per bushel drying charges.

The kicker is finding the happy medium, when corn is easily harvested (standing up) and ears are not falling off the plants, along with finding a drying cost you can live with. Most producers like to wait to get started until corn is around 20 percent to 24 percent, and by the time they finish, the corn may be down in the 17 percent range. It makes the cost a little more bearable.

Fall traffic will greatly increase on rural roads as harvesting starts and hauling machinery begins to move. Keep your eyes open because large, slow-moving machinery can be a recipe for disaster for the unaware. Farmers need to make sure they use the lights and slow-moving vehicle signs on equipment to help other drivers recognize farm machinery from a distance. Be aware and have a safe fall.

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Farm program computer analysis

There are several farm program computer analysis programs available online. These include programs offered by the Texas A&M site, the Iowa State/University of Illinois site, the Corn Growers Association and the Farm Bureau, among others. That is all well and good if you have some time, a good computer connection and understand the information needed to plug into the formulas. If not, there is an upcoming opportunity for you.

Terry Griffin, Extension educator in farm business management, will be in the Logan County Extension office on Sept. 17 from 1 to 3 p.m. with his mobile computer lab. This will allow producers to input information in the University of Illinois program to determine the "best" option to use when signing up for the farm program.

Interested individuals should pick up or request worksheets to complete before the workshop. There will be approximately 10 computers available that day. If you would like to make a reservation, call the office at 732-8289 to book half-hour time blocks for computer usage.

[John Fulton]

[SEPT. 7, 2002]  When the lights are dimmed and a hush descends upon an audience of more than 46,000 at the nation’s largest annual youth convention, Oct. 30 through Nov. 2, Natalie Coers and Jeffrey Potthoff will share the spotlight in a musical performance that will inspire the crowd and provide memories to last a lifetime.

Natalie Coers of the Hartsburg-Emden FFA chapter and Jeffrey Potthoff of the Williamsville FFA have been selected to play the flute and percussion in the National FFA Band. The band will perform several times at the 75th National FFA Convention, adding excitement and motivation to the sessions through their music.

National FFA Band members were nominated by their state associations and chosen from a pool of more than 250 applications. The young musicians are to arrive in Louisville three days before the convention begins, in order to rehearse.

The National FFA Band is directed by Joe LaJoye of Hastings, Mich. The band is sponsored by Ford Trucks as a special project of the National FFA Foundation.

FFA strives to make a positive difference in the lives of its students by developing their potential for leadership, personal growth and career success through agricultural education. Visit www.ffa.org for more information.

[FFA news release]

Understanding your horse—horse sense!

[SEPT. 7, 2002]  URBANA — Dr. Dean Scoggins, an Extension service equine veterinarian at the University of Illinois College of Veterinary Medicine, has many secrets to reveal about the nature of our equine friends. During his 50 years of handling horses, his ideas on horse training have come full circle. He recently shared some of his wisdom, on the eve of his retirement from the university.

"I have known some tremendous horses in my time," says Scoggins. "My first horse was a 3-year-old mare that I bought when I was 15 years old. I bought her and a saddle for $75. She was spoiled and would initially buck me off when I tried to ride her. She eventually became a great horse. She just needed some time, patience, and training. Since then I have noticed that all of the really good horses are strong-willed."

Horses have a strong sense of fairness, and they will take discipline and training but will not stand to be abused. "I once knew a horse that would buck you off in a heartbeat if you were too aggressive or did something that he didn’t think was right, even though he was a national champion performance horse," says Scoggins. "When training a horse, you must strike a balance between being aggressive and being lenient."

In Scoggins’ opinion, there are two directions in which training can go wrong. One way is using too much force to get the horse to do what you want. The horse may obey but may become afraid of you. The horse may also rebel and become difficult or even dangerous.

The other extreme occurs when the owner thinks that the horse is a big poodle and tries to make a pet out of him. The horse may love this because that means that he doesn’t have to do any work, but at the same time, the horse may become disrespectful and start taking advantage of the owner.

"Before you know it, that 1,000-pound horse may be walking all over the poor owner," says Scoggins. "Some people want their horses to be their pets or surrogate children. They want to pet them and love them, but horses don’t really understand that type of behavior. They do not behave that way with other horses, and they are not going to behave that way with humans."

Scoggins finds that the disrespectful horses are the most difficult to work with. As he puts it, when these horses are sent away for training, they think that they have been sent to boot camp because they are expected to do work for the first time.

"Sometimes after correcting this type of problem, these horses become your best buddy because distinct expectations of behavior have been set," says Scoggins. "Horses need and respect boundaries, but owners must be consistent."

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He also believes that the best teacher is the horse himself. "Horses will let you know what methods are the best for training them," he says. "In many cases the horses are of the headstrong variety and may force you to adapt your teaching style. Training is really more of a partnership than anything else."

Scoggins’ beliefs about training have changed over the years. "As a kid I was using many of the same techniques that I do today," he says, "but when I started showing horses I got a lot of advice based on the idea of forcing the horse to do what you want him to do. It was not all brutality, but there was a lot of force involved. Today, I give owners some tongue-in-cheek advice: Throw away the training manuals and instruction books because, for the most part, they were meant to train humans and not horses."

The method that Scoggins prefers is often called natural horsemanship. "This method is all about getting into the horse’s mind and helping him understand what it is that you want him to do," he says. "This style of teaching is especially good for children and people who have never had any experience with horse training.

"I like to make my trainees do calisthenics: stop, turn, roll over their hocks, back up, step forward. What you are trying to do is to get the horse’s brain in gear to do the job, even if that job is just to go out and get the mail. You control the horse’s feet in order to control the horse’s mind by asking for increasingly precise movement."

If you are looking for someone to help you with this style of training, you should spend time with the prospective trainer to make sure this person is a good match with you. "This method sometimes seems as though it takes longer than training by force," says Scoggins, "but by laying the groundwork you can expect a higher level of obedience and respect from your horse in the long run."

[Jennifer Stone, information specialist,
University of Illinois College of Veterinary Medicine]

[SEPT. 6, 2002]  The FFA prides itself in the many activities provided for members to participate in. Summertime brings many trips and conferences, as well as camps. Section 14 FFA members have been very busy over the summer with all of these activities and more.

Shane Westen and Anthony Jones, both from the Hartsburg-Emden FFA chapter, had the opportunity to attend the Washington Leadership Conference in late June. They attended many workshops on leadership and also saw the historic sights of our nation’s capital.

In mid-July, KC Fritzsche of the Athens FFA traveled with other Illinois FFA members to Washington, D.C. on the Heritage Tour. Krista Ubbenga, of the Hartem FFA also traveled to Washington, D.C., as well as to Virginia and Maryland on the Cooperatives Tour. The two tours are a part of the youth education program sponsored by local farm cooperatives, such as the Illinois Farm Bureau and FS.

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Five Section 14 FFA members attended the Illinois Agriculture Youth Institute, sponsored by the Department of Agriculture. Students traveled to agriculture companies across Illinois, as well as gaining teamwork and leadership skills through many activities.

Section 14 had five representatives at the Illinois FFA Leadership Camp in Monticello this year. Students stay on the 4-H Memorial Campgrounds in Monticello. They learn about teamwork and leadership through activities such as the Challenge Course.

For more information about the Illinois FFA, visit www.illinoisffa.org or www.ffa.org.

[FFA news release]

[SEPT. 4, 2002]  URBANA — The "end of the line" has been reached for the few truly independent hog producers left, according to a Purdue University Extension marketing specialist commenting in the wake of what he termed a "panic attack" in the hog market.

"The financial risks of not being aligned in some way in the pork marketing chain are just too extreme," said Chris Hurt. "While many families and hog corporations will not get through this period of low prices, those who stick with it, or counter-cyclical investors who buy at the bottom, can expect handsome returns in late 2003 and 2004."

Hurt termed recent events in the hog market a flashback.

"Say it isn’t so! How can 1998 be happening again? Wasn’t it supposed to be a once-in-a-lifetime event? How can hog producers get through this one? Is this the end of the line for the independent hog producer?" Hurt asked in the wake of a market collapse.

"Panic attack is the only way to describe the past two weeks in the hog market. Those producers who survived 1998 have been determined to not have it happen again. Nearly everyone thought that the worst of the financial crunch would not come until this fall, providing time to move animals to market by late summer. However, a much more aggressive liquidation of sows, advanced marketing of market hogs, and drought which sent feed prices unacceptably higher have set the panic in motion."

Prices were low in early August and conditions grew worse. Terminal hog prices started the month in the mid-$20s and ended the month in the $15-to-$18 range per live hundredweight. However, terminal prices are not currently reflecting base values producers are receiving at packers.

"The national base price for 51-52 percent lean animals on a live-weight equivalent basis ended the month at about $27," said Hurt. "The range of price quotes by market and type of contractual arrangement has been extreme. On Aug. 28, for example, Midwest hog purchase base prices were quoted from $24 to $37 per live hundredweight, with a weighted average of $28.

"The lowest prices were for hogs without contracts, where the producer negotiates the price of each load with the packer. The highest prices were for those in a category known as ‘other purchase agreements,’ which is a non-formula agreement. In general, values of formula hogs were in the $27-to-$32 range on a live-weight equivalent."

Supplies of hogs surged in July and August, increasing by about 7 percent over the same period last year. USDA inventory estimates suggested about 2 percent more hogs for this time period. So, how can the additional 5 percent greater supplies be explained?

"First, sows began to flood the market," said Hurt. "For the two months, sow slaughter was up about 20 percent over the slaughter during the same period last year. Secondly, the increases in Canadian live hog imports accounted for nearly 1 percent additional slaughter. These two factors combined account for about 2 percent of the unexplained 5 percent greater slaughter.

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"A third factor is advanced marketings of market hogs. By the last half of August, producers pressed the panic button and began selling market hogs at lighter weights. At the start of August, weights were running nearly 1 percent higher than weights during the same period last year, but by the last week of August they were down fractionally. All these factors still do not fully account for the large number of hogs. USDA may still have underestimated hog numbers by about 2 percent in their June inventory."

The demand problems for pork have been negative as well, he added. The trade restrictions on broiler exports to Russia, the slowly recovering U.S. economy, a 5 percent decrease in pork exports with a 17 percent increase in imports for this year, and large supplies of competitive meats have left cold storage pork stocks currently up 40 percent.

"The best news for the industry is that sows are being liquidated fairly rapidly," said Hurt. "Sows not bred in August will not have pigs in December, and pigs will not reach market in June of 2003.

"The bad news is that we are still nine months away from seeing the impact of sow liquidation on smaller pork supplies."

Heavy sow slaughter can be expected through much of the fall. Producers will also continue to market lighter-weight pigs. In the short run, these will keep pressure on the already-depressed markets.

The USDA’s September Hogs and Pigs report, to be released on Sept. 27, will likely show a breeding herd not much changed from last year, with the market herd up about 3 percent.

"This will not be sufficient to turn prices higher," said Hurt. "So it appears that fall prices are set for a continuation of the current rugged period. It appears that 51 to 52 percent lean hog prices, on a live equivalent, will be in the $26-to-$28 range. Prices may improve to $28 to $31 for the winter and to near the mid-$30s for the spring. By summer, prices could be back into the low $40s, with mid- to higher-$40s in the last summer and into the fall of 2003."

Costs, he noted, will be near $40. "This means that losses could average about $13 per live hundredweight, or $34 per head, this fall," Hurt said. "Losses would be somewhat less in the winter and only about $5 per hundredweight in the spring.

"In comparison, estimated losses during the fourth quarter of 1998 were $45 per head."

[U of I news release]

Agritourism in Action field trip Oct. 11

[SEPT. 4, 2002]  URBANA — Agritourism, a combination of the words agriculture and tourism, is the focus of the sixth in a series of sustainable agriculture tours. The tour will take place at Apple Basket Farms in Barry from 9 a.m. to noon on Friday, Oct. 11.

Located on the bluffs of the Mississippi, across the river from Tom Sawyer’s old stomping ground, the Pike County, Ill., area once produced more apples than anywhere else in the United States. Most of the orchards are gone now, but nestled in those scenic hills is Apple Basket Farms, one of the area’s last remaining commercial fruit orchards and an example of agritourism in action.

In addition to growing apples, peaches and pumpkins, owners Jack and Karen Cruttenden have transformed their farm into a destination for tourists and school field trips. A listing of the activities available for visitors to Apple Basket reads more like a cross between a theme park and a petting zoo. There’s everything from potbelly pigs to rheas, which are South American ostriches; a cider-making operation; the "a-maize-ing maze" carved out of a cornfield; a miniature village built especially for bunnies; educational school tours; and a gift and food store — in addition to over 80 acres of apples, peaches and pumpkins.

People interested in adding agritourism components to their current farm operation will benefit from hearing how the Cruttendens built their successful and popular farm business.

"Agritourism enabled us to remain on our farm and make a living," said Jack Cruttenden. "We also enjoy sharing our farm with others. You must love people to do what we’re doing."

"Agritourism provides an opportunity for farm operations to engage in ag enterprises that enhance revenue opportunities and overall farm income," said Deborah Cavanaugh-Grant, research specialist at the University of Illinois in the College of Agricultural, Consumer and Environmental Sciences. "It also provides an opportunity for people who are looking for day trips and weekend activities to visit unique and interesting attractions and destinations." She said that combining agriculture and tourism results in enhanced farm profitability (a major component of sustainable agriculture) and a reconnection of the public to agriculture.

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The field trip is free and registration is not required. Apple Basket Farms is located just off Interstate 72 at the Barry exit. The farm is two blocks north of Wendy’s. For more information, including a map of the area, visit http://www.applebasketfarms.com.

The Apple Basket Farms field trip is part of the 2002 Sustainable Agriculture Tours, sponsored by the Agroecology/Sustainable Agriculture Program at the University of Illinois, the North Central Region Sustainable Agriculture Research and Education Professional Development Program, and the Illinois Small Farm Task Force.

"The tours give people a chance to see a variety of sustainable agriculture operations in action," said Cavanaugh-Grant. "Then, in November, we’ll be offering two identical workshops, on the 13th in Effingham and on the 14th in Peoria, that will look at the big picture and try to assimilate the practices presented on the summer tours."

Visit http://www.aces.uiuc.edu/asap/ for more information or contact Deborah Cavanaugh-Grant at (217) 968-5512 or cvnghgrn@uiuc.edu.

[U of I press release]

Honors & Awards

[AUG. 19, 2002]  Directors and staff of the Logan County Soil and Water Conservation District were recognized July 28 at the three-day Land & Water Resources Conference at the Crowne Plaza in Springfield. Terry Davis, chairman of the State Soil and Water Advisory Board, presented a plaque to the group in recognition of 50 years of dedicated public service, in the name of soil and water conservation and natural resource enhancement, to the residents of Logan County.

[Photo provided by SWCD]

Pictured are Zane Downing, soil conservationist; Emily Allspach, summer intern; Bill Dickerson, district conservationist; Carolyn Seitzer, administrative coordinator; Steve Bracey, resource conservationist; and directors Mike Boyer of Middletown, Doug Thompson of Atlanta, Doug Martin of Mount Pulaski, Duane Wibben of Hartsburg and Terry David of the state SWCD.

Ag Announcements

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