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Farm Credit Head: System Safe, Sound

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) — Though agriculture is experiencing pressures on a number of fronts, the head of the Farm Credit Administration told federal lawmakers on Tuesday the overall credit system remains in good shape.

Glen R. Smith, chairman and chief executive officer of the FCA, said during a hearing before the House Subcommittee on Commodity Exchanges, Energy and Credit that, despite all the challenges in the industry, most farms are holding their own.

Because the general economy in the United States is good, Smith said farm families are seeing the benefits.

“Although overall farm finances have declined in recent years, most farms remain financially strong,” he said.

“A strong economy and labor market are helping support the incomes of these producers as well as larger producers. Many producers continue to find ways to cut costs and make the most of the marketing opportunities when prices rise temporarily.

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More Green From Beans – 6

By Pamela Smith
DTN Progressive Farmer Crops Technology Editor

Throw a crop-production question at Brad and Jacob Wade, and it can quickly escalate into a debate.

When asked to rank the top things that determine soybean yield success, Jacob immediately countered: “Volume yield or economic yield?”

“Are they the same thing?” his father, Brad, challenged. That comment lights the fuse. Suddenly, the two are bantering back and forth about every aspect of the soybean-production system and what equates to yield — and to Jacob’s point — profitability?

The Wades, who farm near McLean, Illinois, nearly always come to a hearty consensus.

“We do this a lot,” Brad said. “We’re always asking questions.”

“We’re always looking for the next thing to push us to the next level,” Jacob added.

Some would say yields come naturally in this part of the soybean belt. McLean County, Illinois (where the town of McLean is also located), led the state and nation in total production of corn (71.9 million bushels) and soybeans (21.5 mb) in 2018.

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Problems Purchasing Propane

By Russ Quinn
DTN Staff Reporter

OMAHA (DTN) — As if the 2019 growing season didn’t have enough weather challenges, corn harvest has come to a complete halt for some farmers as propane for crop drying has been hard to secure. Increased demand nationwide due to extremely cold weather is limiting supplies available for drying crops.

While extremely frustrating for these who have seen corn harvest stifled, the good news is more-seasonable temperatures are expected to return to most of the country. This, in turn, should lower demand for propane and make more available to the market; but it will take some time.

A BAD COMBINATION

DTN Oil Markets Reporter Alton Wallace said, “A bad combination of crop drying and extremely low temperatures over a good portion of the nation in recent weeks has caused propane demand to outstrip supply.” DTN wrote about this last week as these issues first emerged.

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Liquidity Concerns Grow

By Katie Dehlinger
DTN Farm Business Editor

DALLAS (DTN) — A majority of farms remain profitable. However, their profit margins are smaller than in recent years, and bankers are growing more concerned about their customers’ liquidity.

According to a survey by the American Bankers Association and the Federal Agricultural Mortgage Corporation, more commonly known as Farmer Mac, agricultural lenders reported that more than 57% of their borrowers made a profit 2019. They expect 56% to remain profitable through 2020.

However, 82.5% of all respondents noted that those profits were declining.

“Liquidity and working capital have just slowly eroded away with those lower profits,” said Bill Gray, market president of Hawthorn Bank in Harrisonville, Missouri. “Most of my producers, when things were good, didn’t go out and overspend on equipment. They reduced some debt. Now, they’re replacing equipment as they need it. They’re making tough decisions and doing a good job of it.”

Bankers from across the country shared Gray’s sentiments at the 2019 ABA Agricultural Bankers Conference this week, with liquidity topping the ABA/Farmer Mac survey as lenders’ top concern.

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Ohio Plan Targets Phosphorous Runoff

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) — Five years after a toxic algae bloom in Lake Erie contaminated drinking water in Toledo, Ohio, the state’s governor this week announced a plan to expand conservation efforts.

In August 2014, Toledo residents were warned not to drink water during a three-day period due to the algae bloom. Questions were raised about the cause of the bloom in Lake Erie, and the finger was pointed at nutrient runoff from farms as a culprit.

Republican Gov. Mike DeWine on Wednesday unveiled the voluntary “H2Ohio” initiative to invest in a number of steps to address phosphorous runoff.

In a news conference on Friday, Scott Higgins, co-chair of the Ohio Agriculture Conservation Initiative and CEO of the Ohio Dairy Producers Association, said the governor’s plan likely will bring more farmers to the table in implementing best practices.

“Farmers truly do understand the value of conservation,” he said.

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MFP Payments Coming Before Thanksgiving

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) — The Trump administration announced a second tranche of 2019 Market Facilitation Program payments on Friday. According to a USDA news release, payments will begin the week before Thanksgiving.

MFP for 2019 is providing $14.5 billion in direct payments to producers, meaning the second tranche will be for about $7.8 billion.

Under MFP2, USDA so far has paid out $6.69 billion to 564,181 producers. USDA reports the top five states for payments are Illinois, Iowa, Kansas, Nebraska, and Minnesota. The 2018 MFP paid out $8.6 billion to more than 1 million farmers.

Producers of MFP-eligible commodities will now be eligible to receive 25% of the total payment expected, in addition to the 50% they have already received from the 2019 MFP.

“This second tranche of 2019 MFP payments, along with already provided disaster assistance, will give farmers, who have had a tough year due to unfair trade retaliation and natural disasters, much needed funds in time for Thanksgiving,” U.S.

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China Lifts Ban on US Poultry Imports

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) — Poultry exports from the United States to China will resume after the Chinese government lifted a four-year ban on Thursday, as the nation struggles to meet protein demands in light of the African swine fever outbreak.

The lifting of the ban is effective immediately. China imposed the ban in 2015, responding to avian influenza outbreaks in the U.S.; the U.S. has been free of avian influenza since 2017.

The news was welcome relief for U.S. poultry producers. The National Chicken Council, National Turkey Federation and the USA Poultry and Egg Export Council released a joint statement following the announcement.

“Lifting the ban has been a top priority of the U.S. poultry industry for the past four years,” the groups said. “We thank President Trump, Agriculture Secretary (Sonny) Perdue, U.S. Trade Representative (Robert) Lighthizer, Treasury Secretary (Steve) Mnuchin, congressional leaders and their staffs, all of whom have worked tirelessly to reach an agreement with China and ensure the poultry industry has access to this market.”

At its peak, annual poultry exports from the U.S.

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Brazilians Defend Ag Policies

By Chris Clayton
DTN Ag Policy Editor

WASHINGTON (DTN) — Brazil’s political and agricultural leaders are incensed over global criticism of Amazon fires and deforestation and they are pushing back.

At a conference Wednesday in downtown Washington, D.C., Brazilian agribusiness groups sought to shift the narrative by highlighting “sustainable food” and a “science-based model” for agriculture. They also strongly criticized the view that fires in the Amazon are due to illegal expansion of ranches and crop production.

Nestor Forster Jr., Brazil’s Charge of Affairs in Washington, D.C., or top diplomat, didn’t mince words about Brazil’s changing views about the economy and environment under President Jair Bolsonaro. Protectionism in the country “is being demolished, being destroyed.” The country is undergoing an economic reform, which includes more private sector land investment to spur growth. Gross domestic product is projected at 0.9% for 2019, but the government has its sights set on 2% growth for 2020, Forster said.

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More Green From Beans – 5

By Emily Unglesbee
DTN Staff Reporter

When John Werries and his son Dean started using cover crops, their primary goal was to prevent soil erosion on their Illinois farm. Seven years later, they’ve discovered their cover crop of choice, cereal rye, which hates weeds as much as they do.

Illinois is home to some challenging herbicide-resistant weeds, including waterhemp populations that can survive six different herbicide modes of action. But, on the Werries’ farm, near Chapin, the chemicals get an assist. The Werries plant soybeans directly into thick stands of cereal rye and then terminate the growing cover crop.

“As all of the cover melts down — and it takes a long time — there is a mat that makes it tough for weeds to grow,” Werries explained. The suppression allowed them to cut back on their herbicide use in soybeans this year, and their fields stayed clean through the end of the season.

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Call the Market

By ShayLe Stewart
DTN Livestock Analyst

This may be a year simply characterized by the John Wayne quote, “All battles are fought by scared men who’d rather be someplace else.” Cattlemen wanting to be somewhere else? I think most would say, “You betcha,” as they hand you their worn-out muck boots, a list of calves to doctor, an operating note that has a lofty total underlined, circled and highlighted at the bottom of the page, and calves still left to sell for the year. Today’s cattlemen are a tough bunch of tenacious souls who all know that working an 8 a.m.-to-5 p.m. job would be much easier given that this year has presented challenges unlike ever before.

Fall calf prices in 2018 didn’t send any ranchers speeding home from the scales to kiss their wives and dance happily on the kitchen floor because they finally made it big. Instead, ranchers collected their calf checks, paid off their operating notes and prayed that 2019 would bring another skiff of 2014 luck.

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2020 House Election Forecast

By Jerry Hagstrom
DTN Political Correspondent

WASHINGTON (DTN) — One year from the 2020 general election, more than half of the Democrats on the House Agriculture Committee are facing less-than-“solid” chances of retaining their seats, but the Democrats appear on the path to retain their majority in the House, according to David Wasserman, the House analyst for The Cook Political Report.

Of the committee’s 25 Democratic members representing districts in the 50 states, 14 are facing races that the Cook Report ranks as less than “solid,” and nine of those races could favor the Republican, per the Cook Partisan Voter Index (PVI). The index measures how each district performs at the presidential level compared to the nation as a whole.

Stacey Plaskett, the Democratic delegate from the U.S. Virgin Islands, is also a member of the committee, but the Cook Political Report does not rank the delegates from the U.S. territories.

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The Wonder of Wheat

By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) — It was another record-setting year for the National Wheat Yield Contest, which announced its 2019 winners Tuesday. Three winners topped 200 bushels per acre (bpa), with Rick Pearson of Buhl, Idaho, gleaning top yield honors with a 211.59-bpa irrigated winter wheat entry.

Close behind him was Marc Arnusch of Keenesburg, Colorado, whose irrigated winter wheat field reached 210.52 bpa, and Phillip Gross, whose irrigated winter wheat field in Warden, Washington, hit 200.48 bpa.

DTN/Progressive Farmer is the official media outlet of the contest, which is sponsored by the National Wheat Foundation.

This year, the results of the annual competition cast a spotlight on the widely varying wheat-growing regions of the U.S.

First, there is Pearson, who, from the rich, river-fed soils of his southern Idaho farm, grew a field of densely packed, soft white winter wheat bursting with nearly 212 bushels per acre.

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Trade Aid Disparity Claims

By Chris Clayton
DTN Ag Policy Editor

WASHINGTON (DTN) — A group of Senate Democrats released a report Tuesday on the Trump administration’s agricultural trade aid program, charging USDA “is picking winners and losers in their attempt to aid farmers affected by President Trump’s turbulent trade agenda.”

Led by Senate Agriculture Committee ranking member Debbie Stabenow, D-Mich., and Senate Minority Leader Chuck Schumer, D-N.Y., the report stated Market Facilitation Program payments were unevenly distributed across the country.

The report states USDA’s MFP “has treated farmers unfairly by, among other things, sending 95% of the top payment rates to Southern farmers, who have been harmed less than other regions, and helping farms owned by billionaires as well as foreign-owned companies, including awarding $90 million in purchase contracts to a Brazilian company.”

The MFP was set up last year after the Trump administration vowed farmers would not be hurt by trade disputes with China and other countries that had sparked retaliatory tariffs.

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More Green From Beans – 4

By Matthew Wilde
DTNProgressive Farmer Crops Editor

Corn takes a back seat to soybeans on Joshua Rausch’s farm at planting.

The Paullina, Iowa, farmer is part of a growing trend of producers who plant soybeans before or at the same time as corn to maximize yields and profit potential.

Soybeans are traditionally planted after corn nationwide, primarily because of risk. Corn costs more to plant and needs time to take advantage of higher-yielding, long-season hybrids. Soybeans are more forgiving than corn and have a better chance to produce a crop if planted well into June or July. Plus, a late-spring frost can kill soybean plants after emergence since the growing point is already out of the ground, unlike corn.

Rausch used to plant corn first, too, which meant soybeans usually got in by mid- to late May. That changed when soybean yields plateaued a few years ago at 65 to 75 bushels per acre.

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SCN Does the Backstroke

By Pamela Smith
DTN Progressive Farmer Crops Technology Editor

DECATUR, Ill. (DTN) — Extremely wet weather didn’t wash away worries for soybean cyst nematode (SCN). In fact, flood waters may have moved the pest to new areas, according to Greg Tylka, Iowa State University nematologist and one of The SCN Coalition leaders.

“That’s one reason we’re recommending soil sampling for SCN during fall fertility testing,” said Tylka. The only way to know if a field has SCN problems is to soil test, he detailed in a recent news release.

Flooding isn’t the only thing responsible for SCN’s expanding range. Soil moved by wind, birds and other animals and farm equipment has been spreading SCN in all directions since it was first discovered in New Hanover County, North Carolina, in 1954.

“As of 2019, SCN has been confirmed in every county in Illinois and Iowa, and all but two Indiana counties (Monroe and Brown),” Tylka added.

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Republicans Push EPA on RFS

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) — Seven Midwest senators and Iowa’s governor, all Republicans, are pushing back on EPA’s supplemental plan for the Renewable Fuel Standard, stating in comments that EPA’s latest plan continues to kowtow to petroleum industry profits.

EPA is in the middle of a comment period for a plan that would add to 2020 RFS volumes by accounting for small-refinery exemptions and ideally achieve at least 15 billion gallons of renewable fuel volumes in 2020. EPA wants to use a Department of Energy recommendation on waived gallons from 2015 to 2017, or an average of roughly 770 million gallons.

Yet, biofuel advocates maintain the deal struck at the White House back in September calls for factoring in a three-year average of biofuel gallons exempted from 2016 to this year, which comes in closer to 1.35 billion gallons a year.

Iowa Gov. Kim Reynolds submitted public comments in a letter to EPA Administrator Andrew Wheeler, along with fellow Iowa Republicans, Sens.

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NPPC Campaigns for USMCA

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) — The National Pork Producer Council is starting another campaign to get Congress to pass the U.S. Mexico Canada Agreement before the end of the year.

Nick Giordano, NPPC’s vice president and counsel for global government affairs, told DTN NPPC made a judgement last summer to push hard for Congress to complete the trade deal before the end of 2019. Right now, hog farmers “are getting antsy” that negotiations between House Democrats and the Trump administration could carry into 2020.

“Our best judgement was the deal would come up around Thanksgiving or in December,” Giordano said. “We’re still very hopeful we get that vote before the end of the year.” He added, “Our producers want the certainty of continued North American trade,” Giordano said. “They saw the impact of punitive tariffs. It really tied them in knots and it was a huge financial problem for the industry.

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The 5thWave Forum

By Tregg Cronin
DTN Contributing Analyst

There’s an old market adage that says, “There is always a bull market somewhere.” Corn, soybean and wheat bulls have had opportunities during the 2019-20 marketing year, and some of that story is still being written as harvest continues to plod along across the Midwest. One market that hasn’t gotten a lot of attention until combines began to roll, however, is the sunflower market.

For obvious reasons, the sunflower market doesn’t garner the interest other grain and oilseed markets do given the largest number of planted acres over the last 10 years was 2 million. The sunflower market is taking on added importance this year given the tightening U.S. and global vegetable oil markets, as some DTN authors have written about recently.

South and North Dakota rank No. 1 and No. 2, respectively, in sunflower production in the United States. It is no secret to anyone that these two states were inundated with rain throughout the summer growing season with both running 150% to 600% above normal precipitation over the last 90 days.

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Corn Belt Propane Crunch

By Todd Neeley
DTN Staff Reporter

OMAHA (DTN) — As of Wednesday morning, Harmony, Minnesota, farmers Jeff and Roxi Thompson were having no problem finding enough propane to dry their corn crop.

That all changed by Wednesday evening.

“We are down to 800 gallons and our supplier called tonight and said he’s out of gas and can’t tell us when he’ll have more,” Roxi said. “This means harvest is over until gas is delivered.”

The Thompsons are not alone as farmers across the Corn Belt are running into supply bottlenecks at a time when they can ill afford to wait. The Federal Motor Carrier Safety Administration declared a regional emergency in Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, South Dakota and Wisconsin.

At the end of last week, governors in Iowa, Minnesota, Missouri and Wisconsin issued emergency declarations to lift restrictions on carriers for the transportation of heating fuel, including propane. This is expected to help alleviate supply issues in the region.

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More Green From Beans – 3

By Darcy Maulsby
Progressive Farmer Contributing Editor

As he looks across his fields spanning the flat terrain of northern Iowa, Mike Riggert isn’t just seeing rows of soybeans. He’s thinking about ways to adjust his seeding rates.

“For years, we planted a flat rate of 150,000 seeds per acre, but we’ve definitely cut back on seeding rates in the last two or three years,” said Riggert, who farms with his brother, Brian, near Whittemore.

It’s a targeted process for Riggert, who plants soybeans in 30-inch rows and has been experimenting with variable-rate seeding. In some cases, he has dropped rates as low as 80,000 or 90,000 seeds per acre. In other places, like high-pH areas that tend to stunt the plants, Riggert has planted 175,000 seeds per acre. In fields with neutral soil pH and adequate fertility, he typically plants 120,000 seeds per acre.

“You can get good yields with lower planting populations if you pay attention to detail,” said Dan Bjorklund, seed team leader for MaxYield Cooperative, which serves the Riggert farm.

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