There are many tasks that go into making a successful crop. Planting and harvesting are by far the most glorified, but other tasks may have greater impact on the crops growth. The video below was filmed by Robert Frye, showing fungicide application in Buchanan County, Iowa. Fungicide is used to kill fungi that can grow on the crops and cause it to rot. This crop year was a very important year for fungicide application due to all of the early season wetness.
(Bloomberg) The El Nino weather pattern sweeping the globe for the first time in five years risks setting off the next great surge in world food prices after they rose to records in 2008 and 2011, according to Nomura International Ltd.
Forecasters are predicting that El Nino, characterized by ocean warming in the equatorial Pacific, may be the strongest since records began in 1950. It has already brought torrential rains to parts of South America and dryness to Southeast Asia. The Philippines said on Thursday it plans to boost rice imports to prepare for potential shortages, while Rabobank International warned that wheat crops in Australia may beunder threat.
Corn sales reported a net reduction of 131,700 metric tons (MT) this week, the largest reduction in corn sales since August 2011. Soybean sales reported a reduction of 131,600 MT, the third largest reduction this year. Depressed crop prices and a strong U.S. Dollar incentivized buyers of 2014/15 corn to cancel their purchases. Wheat sales increased nearly 70% after declining for the past two weeks. Corn, soybean, and wheat exports all reported double digit decreases this week.
Weekly net corn sales for the 2014/15 marketing year were a reduction of 131,700 MT, the second reduction reported in the past four weeks. Increases were reported from Japan, Mexico, and Panama. Decreases were reported from unknown destinations, Colombia, Canada, Venezuela, Costa Rica, and the Leeward and Windward Islands. Exports were 820,600 MT, an 11% decrease from last week and a 20% decrease from the prior 10-week average. The primary destinations were Japan, Mexico, Venezuela, Colombia, and South Korea. ...continue reading →
(AP) Land in Central California's agricultural region is sinking so quickly because of the state's historic drought that it is forcing farmers to spend millions of dollars upgrading irrigation canals and putting roads, bridges and other infrastructure at risk.
The Central California Irrigation District recently spent $4.5 million to raise the walls of a canal, and the district's manager, Christopher White, says they're about to invest another $2.5 million to replace a bridge that's now below the canal's water line.
"It's a vivid picture of what subsidence can do," said White, who serves 1,900 farmers on the San Joaquin Valley's west side that grow crops such as tomatoes, cotton, fruit and almonds in three counties. Subsidence is the gradual caving in or sinking of an area of land. ...continue reading →
(Bloomberg) Syngenta AG rose the most in more than three months in Zurich trading as people familiar with the matter said U.S. rival Monsanto Co. has made an increased takeover offer, seeking to draw the Swiss agro-chemical producer to the negotiating table after its earlier approach was rejected.
The recent offer values Syngenta at about 470 Swiss francs per share in cash and stock, compared with the 449 francs the U.S. firm offered earlier this year, the people said, asking not to be identified discussing a private situation. That would translate to a market capitalization of about 43.7 billion francs ($47 billion), data compiled by Bloomberg show.
The proposal contains a higher proportion of cash than the prior bid, which envisioned a split of 45 percent cash to 55 percent Monsanto shares, the people said. Syngenta jumped as much as 8.6 percent to 388.3 francs at 10:06 a.m. in Zurich on Tuesday, the biggest gain since May 8, giving the company a market value equal to $38 billion and making the stock the best performer in the Stoxx 600 chemicals index. ...continue reading →
The rural economy was unchanged in August as declining grain prices stunted the economic progress made in July. Farmland prices continued to vary across the surveyed area, but overall farmland prices declined for the 21st consecutive month. Marginal farmland continues to make up the majority of properties for sale in August, negatively impacting the view of the overall market. Respondents were asked, “What is the average annual rent per acre for cropland?” the average response was $263, up from $258 in 2014.
The Rural Mainstreet Index (RMI), an index which ranges from 0 to 100 with 50.0 representing growth neutral, decreased in the August report to 50.0, from 53.4 in July. Ernie Goss, Ph.D, Economics Professor at Creighton University stated, “This is the first decline in the overall index since March of this year. Weaker conditions among businesses tied directly to agriculture and energy accounted for the downturn in the reading." ...continue reading →
Soybean conditions remained below average in the eastern Corn Belt, as farmers remain hopeful good weather through the end of August can partially offset a dismal growing season. Soybean maturity is slightly behind schedule across the Corn Belt except in Minnesota, where pod setting is reportedly 7% above the five-year average. Corn conditions are favorable in the western Corn Belt, but overall were unchanged from last week. The spring wheat harvest is nearing completion with farmers 28% ahead of the five-year average.
The USDA estimated corn crop conditions in the U.S. as of August 23rd, at 69% as “Excellent” or “Good,” unchanged from last week, and a 4% decrease from last year. 21% of the crop was reported as “Fair,” unchanged from last week, but a 1% increase from last year. 10% was rated as “Poor” or “Very Poor”, unchanged from last week, but a 3% increase from last year.
Corn doughing was estimated by the USDA at 85%, a 14% increase from last week and a 4% increase from the five-year average. Of the five largest corn producing states, Illinois reported the most corn doughing at 91%, followed by Iowa at 89%, and Minnesota at 88%. ...continue reading →
(WSJ) Deere & Co.’s profit fell 40% in the latest quarter as weak crop prices continued to curb farmers’ appetite for new equipment, leaving U.S. dealers with a glut of used models.
Deere, the world’s largest seller of tractors and harvesting combines, also trimmed its profit and sales forecasts for the year despite topping profit expectations for its July-ended fiscal third quarter.
The company predicted Friday that cash receipts from farming in the U.S., which is a key driver for equipment sales, will fall 7% this year and will likely slip again in 2016, suggesting another year of weak equipment sales. Lower crop prices brought on by record harvests in the U.S. and softening demand from overseas have cut into farmers’ incomes over the past year, reducing their interest in buying new equipment. ...continue reading →
The Pro Farmer Crop Tour began Monday with crop scouts reviewing fields across the Corn Belt. Many crop tours are released in August, but the Pro Farmer Crop Tour has grown to be the most reputable. Crop scouts survey corn and soybean fields recording data used to make estimates on area yield expectations.
As expected, reports coming out of the eastern Corn Belt were poor with many areas showing nitrogen deficiency following all of the rain those areas received throughout the growing season. Reports improved as the crop scouts moved west. Overall, the reported yield expectations were below USDA predictions. It will be interesting to see how the USDA will react in the September WASDE.
Clockwise starting from the top left; Bureau County, Ill Soybeans by Katie Micik (@KatieMDTN), South Dakota Corn Field by Chad Johnson (@TheChadMovement), Paulding County, Ohio Corn by Katie Micik (@KatieMDTN), and Lake County, South Dakota Corn by Pam Smith (@PamSmithDTN)
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(Granular) Land costs typically represent more than one third of a farm’s operational costs. The mix of owned vs. rented land has a significant impact on profitability, risk and the ability to scale. As an operation grows, there can be important differences resulting from expanding through rental or through acquisition of additional land. What are the considerations when deciding to rent vs. buy more land? While not an exhaustive list, a few of the key differences are highlighted below:
1. Return: In a rental scenario, returns on ownership (appreciation of the asset) accrue entirely to the owner, while operational returns (farming profits) accrue to the operator, or are shared between owner and operator. In a purchase scenario, the operator captures both the ownership and operational returns. And the two types of returns are not necessarily correlated. So one question to ask is: do you want to be in the farming business or the real estate business?...continue reading →