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Weekly outlook

Corn and soybean markets

[SEPT. 24, 2002]  URBANA — In spite of strong market signals to the contrary, reports suggest that producers are not rushing to sell corn at harvest time, said a University of Illinois Extension marketing specialist.

"If the crop size forecast does increase, higher prices will have to be generated by demand or concerns about next year’s crop," said Darrel Good. "If consumption unfolds as projected, it will be difficult for prices to move a lot higher before next spring. With use as projected, higher prices in the near term may require an unchanged or smaller crop forecast in October."

Good’s comments came as he reviewed recent action in the corn and soybean markets. December 2002 corn futures established a contract high of $2.96 on Sept. 9. The USDA reports released on Sept. 12 contained a smaller forecast of the 2002 U.S. corn crop (down 37 million bushels from the August forecast), a smaller forecast of foreign coarse grain production and a smaller forecast of U.S. and world grain inventories at the end of the current marketing year. Since those smaller forecasts were released, December corn futures have declined 31 cents.

"A number of factors may have contributed to the decline, but liquidation of long positions held by speculative traders has been one of the dominant factors pressuring prices," said Good. "The liquidation appears to have been triggered by reports of ‘better than expected’ yields.

"It is never clear whose expectations have been exceeded, but the reports have resulted in ideas that the USDA’s October production forecast may exceed the September forecast, as was the case last year."

In addition to thoughts that the U.S. crop could exceed the current projection, the slow start to the 2002-03 export program raises concerns about corn demand. As of Sept. 12, the USDA reported 2002-03 marketing year export commitments at 303 million bushels. That figure is about 8 percent smaller than export commitments on the same date last year. The USDA has projected that exports during the current marketing year will be 100 million bushels larger than exports of last year. Compared with last year, smaller sales have been registered to Egypt, Taiwan, South Korea and China. Prospects for a larger Chinese corn harvest create concerns about Asian demand for U.S. corn.

"Recent price behavior in the corn market is a reminder that U.S. and world feed grain supplies are smaller than a year ago, but little, if any, rationing of use may be required," said Good. "Current new crop price relationships are slightly in favor of additional corn acreage in the United States in 2003."

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November 2002 soybean futures reached a high of $5.91 on Sept. 11. The USDA’s Sept. 12 reports contained larger forecasts (compared with the August forecasts) of U.S. and world soybean production and stocks for the 2002-03 marketing year. Since the forecasts were released, November futures have declined about 24 cents.

"While the forecasts suggest that use of U.S. soybeans will have to decline during the current marketing year, world supplies are expected to be adequate to allow for increased consumption," Good noted. "The USDA currently projects a 3.3 percent increase in world soybean consumption. The increase is expected to come primarily in South America and China.

"The South American increase reflects expectations of a larger crush, primarily to meet export demand for soybean meal. China is expected to import 36 percent more soybeans than last year in order to expand the domestic crush to support increases in domestic meal and oil consumption."

U.S. soybean exports during 2002-03 are projected to be 215 million bushels (20 percent) less than exports during the past marketing year. As of Sept. 12, the USDA reported that export commitments for the current marketing year totaled 240 million bushels. Commitments are nearly 5 percent larger than on the same date last year and account for slightly over 28 percent of the USDA’s projection for the year.

New sales need to average only 12 million bushel per week for the next 50 weeks to reach the USDA’s projected level of exports. At 62 million bushels, current outstanding sales to China are nearly double the level of sales of a year ago. On the other hand, sales to the European Union, the largest buyer of U.S. soybeans, total only 19 million bushels. Sales to the EU are down by two-thirds from sales of a year ago. The EU is currently buying larger quantities of South American soybeans.

"Early season reports on U.S. soybean yields have not been as numerous as corn yield reports," said Good. "Early results apparently do not differ significantly from expectations."

Soybean prices will be influenced by a wide range of factors, including subsequent U.S. crop forecast, rate of use and prospects for the South American crop.

"The most important factor near term will be the USDA’s October production forecast for the United States," said Good.

[U of I news release]

[SEPT. 24, 2002]  Brittney Kavanaugh from the Hartsburg-Emden FFA attended the FFA Reporter’s Workshop at Lincoln Land Community College in Springfield recently.

The workshop was presented by Emilee Bocker, the state FFA reporter for Illinois. "She did a great job," Brittney said, adding that it was "a great learning experience for everyone who attended the workshop."

[FFA news release]

[Photo provided by FFA]

[SEPT. 24, 2002]  The FFA Leadership Camp 2002 was a great success and a lot of fun for Hartsburg-Emden students who attended.

Robin Niehaus gave a presentation on "Get Fired Up," and the FFA alumni also gave a presentation. The state officer team conducted mixers, and members were involved in a talent show, quiz bowl team, volleyball team, challenge course, "good morning" radio show and flag committee. Participants at the camp learned more about community development, student development, chapter development and much more.

Thanks to those who support the FFA so that individuals can attend events like this.

[Brittney Kavanaugh,
Hartsburg-Emden FFA reporter]

[Photo provided by FFA]
[Pictured, left to right, are Jeff Evers, Brittney Kavanaugh, Ryan Fleck, Bruce Frank and Justin Brown.]

Harvest progress

[SEPT. 23, 2002]  As of today, the harvest progress stands at about 15 percent completed for corn harvest and virtually 0 percent for soybeans. Corn progress varies widely by local area as farmers have been searching for dry corn to start in. Many area cornfields have been "opened up," meaning that end rows have been harvested.

Moisture percentages have ranged from the upper 20s down to the upper teens. Due to the cost of drying, most producers don’t want to start harvest unless moisture is in the lower 20s, unless there are problems with corn standing upright. Once again there are pockets of corn that are lying flat on the ground due to windstorms, corn borer damage and stalk rots.

[Photos provided by John Fulton]

Preliminary results from the county corn borer survey indicate heavy corn borer pressure, especially on the east side of the county. The average survey found almost four borers per plant on the east side of the county in 24 of 25 plants. These numbers will give us over a 10 percent yield loss due to European corn borer this year. This is in addition to fields that may be prone to stalk breakage in windstorms. Another factor is possible dropping of ears due to corn borers weakening the shank that attaches ears to the stalk.

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Early yield reports have been as expected — highly variable. Many yields reported have not been from entire fields but from combine yield monitors and weigh wagons. The low-end yields have been just over 100 bushels on some corn after corn, and the high yields have been over 200 bushels per acre in areas that received timely rainfall.

Where will yield averages fall? Somewhere between those two numbers. As yields reports have not come from whole field averages, take them with a grain of salt. Individual field variation has been greater than the yield reports. In another month or so, we’ll have a good handle on what yields were.

[John Fulton]

[SEPT. 23, 2002]  For National Farm Safety Week the Hartsburg-Emden Intro to Ag class put up a window display at the Hartsburg State Bank.  [Photos provided by ag class.]

Other countries are using it for energy production

What is Miscanthus?

[SEPT. 21, 2002]  URBANA — In their search for a crop that would yield greater biomass for fuel production, European farmers chose Miscanthus. In fact, grassy biomass crops such as Miscanthus are being used for energy production in Europe; power stations fueled solely by plant biomass have been built and are operational in Britain and Denmark; and most European countries are using plant biomass to some extent and experiencing rapid growth. Researchers at the University of Illinois in the College of Agricultural, Consumer and Environmental Sciences are using computer models to predict what Miscanthus yields would be when grown on farms in the Midwest.

"This model, based on the European experience with Miscanthus," said Steve Long, U of I plant biologist, "predicts that no matter where the crop is grown in Illinois, it will yield as good as or better than it does in Europe — that is, yields of 11 to 17 dry tons per acre per year. Now, with the support of C-FAR (Illinois Council on Food and Agricultural Research) we are testing these model predictions with trials of the crop across the state."

The potential for growing Miscanthus, the benefits of grassland systems, management strategies and applications for biofuel are some of the topics that will be covered at the Sustainable Grassland Systems Field Day, from 8 a.m. to 3:30 p.m. Thursday, Oct. 17, at a field location just north of Monticello.

Long said that crops such as Miscanthus would add to the diversity of options for farmers, increasing stability of farm incomes. "Once established, Miscanthus is a low-input crop which adds large amounts of carbon to the soil, will help to decrease errant nitrogen from entering our water supplies and improve the quality of our soils."

Emily Heaton, who is conducting the Illinois trials with Long and Tom Voigt at the university, added, "Recent events in the United States and abroad have highlighted the crucial need for energy sources that are not only clean and renewable, but also domestically abundant. The federal government has recognized the vital role agriculture can play in satisfying U.S. energy demand. Biofuels, specifically energy crops, were included in the new 2002 farm bill, reflecting the increasing importance of these crops in the U.S. energy and agricultural portfolios."

Long said that green energy from perennial, grassy energy crops, particularly Miscanthus, provides an opportunity for the agricultural and energy industries to work together by growing profitable and sustainable new crops while simultaneously providing clean, renewable fuel.

At the field day, morning speakers will present information on topics relating to grazing, including the economics of grazing, legislation and managing intensive grazing. After a field tour, demonstration and lunch, there will be a presentation by the Illinois Department of Agriculture’s AgriFIRST program, followed by several experts speaking on topics related to using plants as fuel, including Long’s presentation on Miscanthus and a presentation from crop sciences graduate student Emily Heaton, who works with Long. Attendees will have a chance to see firsthand the largest field plot of Miscanthus for fuel production in the United States.

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The field location is just north of Monticello and south of Lodge. Interstate 72, take Exit 166 at Monticello’s Market Street. At the stop sign turn north. The Rick Ridings auto dealership will be on your right. Continue on old Route 47 about 1.25 miles until you come to the end of Lodge Park. At this point turn north onto Cry Baby Bridge Road, cross the Sangamon River, and continue to the "Y." Turn west and continue for about one-half mile until you come to the railroad tracks. Cross the tracks, turn north and continue about one-half mile.

The Sustainable Grassland Field Day is hosted by John Caveny, president of Environmentally Correct Concepts in Monticello. "I believe that producing grassy bioenergy crops will be a core enterprise on farms in Illinois in the near future," states Caveny. "Renewable base-load electric energy from grass is one ag product that is not in surplus."

Other partners include Illinois AgriFIRST, Dynegy Midwest Generation, Illinois Extension, NRCS and the Dudley Smith Initiative. The field day 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 and field days we’ve sponsored this summer and fall have given people a chance to see a variety of sustainable agriculture operations in action," said Deborah Cavanaugh-Grant, Extension specialist for the University of Illinois’ Agroecology/Sustainable Agriculture Program.

The entire Sustainable Grassland Systems Field Day is free, including lunch. However please make a reservation by Oct. 10. For more information and to register, please contact John Caveny at (217) 762-7767 or by e-mail to soilsteward@prairieinet.net.

The U of I Miscanthus project is funded by C-FAR.

[U of I news release]

New Zealand dairy trip open

[SEPT. 20, 2002]  URBANA — A University of Illinois Department of Animal Sciences field study trip to New Zealand focusing on that nation’s dairy industry has openings for a number of non-students, said Gene McCoy, U of I dairy science research specialist and organizer of the tour. The group will leave Chicago on Jan 6 and return there on Jan. 18.

"This is a great opportunity to observe the New Zealand dairy industry, its practices and research first-hand," said McCoy, who will be leading the trip with Richard Wallace, U of I Extension dairy veterinarian.

"We'll tour a number of dairy farms, observe grazing practices and visit a research center. One of our stops will be at a commercial deer ranch. Deer ranching is becoming very popular in that country."

Transportation and lodging costs are approximately $2,800 per person, not including spending money.

McCoy said those interested should contact him by Sept. 23 at (217) 333-2625, (217) 351-9106, or g-mccoy@uiuc.edu.

[U of I news release]

Aflatoxin problems in corn
isolated to southern Illinois

[SEPT. 19, 2002]  URBANA — Recent reports indicate that elevators in southern Illinois have rejected some truckloads of corn because of the presence of aflatoxin as indicated by a black-light test. In some cases, levels have been reported as high as 200 or 300 parts per billion. That compares to the cutoff point of only 20 parts per billion for interstate commerce.

But according to Don White, professor of fungal diseases of corn in the Department of Crop Sciences at the University of Illinois, the pro blem appears limited only to a small area in the southern part of the state.

"There certainly is no reason for the markets to be panicked over this development," White said. "The situation so far is restricted to a small geographical area. The growers who need to watch out are those who are harvesting a drought-stressed corn crop that is low in yield. I would be really surprised if we have enough aflatoxin in the other areas of the state to cause any real concerns."

White notes that it usually takes two consecutive years of dry weather to produce widespread problems from aflatoxin, which has not been the case in Illinois.

"The fungus that produces the toxin normally does not do well when conditions are wet," he said. "It just cannot compete well with other bacteria and fungi in such an environment. Normally, however, you need two straight dry years before the innoculum builds up to the high levels that can cause a problem."

White points out that even those growers who have their corn rejected at the elevator still have several options open to them.

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"High levels of aflatoxin are usually found only in the broken and cracked kernels," White said. "Those can often be screened out using a grain cleaner, leaving the remaining corn below the threshold for aflatoxin contamination. The loss in this process is usually only about 1 or 2 percent."

He adds that even corn with low to moderate levels of aflatoxin can also be safely fed to finishing steers.

"It is important, however, that corn with aflatoxin should never be used to feed dairy cows, because it metabolizes into an aflatoxin-like product in the milk," he said. "Chickens also are very susceptible to problems from aflatoxin. But certainly, finishing steers can handle it quite well."

White also warns against feeding any of the corn screenings, which contain the cracked and broken kernels, to any kind of animal. He further advises growers to be careful in storing drought-stressed corn, because aflatoxin can be produced in stored corn that has not been dried to at least 14.5 percent moisture content.

"At this point, there is no reason for major concern," he said. "We appear to have a problem only in drought-stressed corn from a relatively small area. We will continue to remain vigilant for any further problems as harvest continues."

[U of I news release]

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