Senators Write RMA on Crop Insurance SRA Process

Ten Senators wrote the head of the Risk Management Agency last week, urging cooperation as the Agency seeks to renegotiate the contract between the government and private companies that administer the federal crop insurance program.

The Standard Reinsurance Agreement (SRA), as the contract is known, is set to be rewritten under new rules laid out in the 2008 Farm Bill. Specifically at stake in the process is the handling of administrative and operating reimbursement rates that, if cut inappropriately, could affect the level of coverage and service producers experience.

The Senators emphasized the importance of the program to producers, many of whom rely on it as the centerpiece of their farm safety net, and urged RMA to seek improvements to the process that benefit both producers and their insurance agents.

They also communicated the expectation that the SRA renegotiation process be collaborative between insurers and their representatives, saying: Congress envisions the renegotiation process as a genuine back-and-forth negotiation rather than one which is in effect a rulemaking by RMA and the Federal Crop Insurance Corporation. The letter was signed by Senate Agriculture Committee Chairman Tom Harkin (D-Iowa) and Ranking Member Saxby Chambliss (R-Ga.) as well as Finance Committee Chairman Max Baucus (D-Mont.) and Ranking Member Chuck Grassley (D-Iowa); Budget Committee Chairman Kent Conrad (D-N.D.); and Sens. Pat Roberts (R-Kan.), John Thune (R-S.D.), Ben Nelson (D-Neb.), Kay Bailey Hutchison (R-Texas) and Michael Bennett (D-Colo.).



FAPRI: Farm Prices Depend on General Economy Recovery

Uncertainty in the general economy continues to drive the agricultural market outlook in a midyear baseline from the University of Missouri Food and Agricultural Policy Research Institute (FAPRI).  “For most U.S. crops, market prices have declined from last year’s peaks but remain well above pre-2007 levels,” said Pat Westhoff, senior economist and co-director of FAPRI.  “On the livestock side, the baseline shows recovery in 2010 for meat and dairy prices but depends on general economic recovery and continued reduction of supplies,” said Scott Brown, FAPRI livestock economist.  “Lower petroleum prices have reduced production costs,” Westhoff said. Those lower prices also reduce demand for biofuel. This lowers demand for corn and soybeans, major sources of those fuels.  The mid-August FAPRI baseline is a limited updating of the 10-year baseline released in March 2009. The agricultural commodities outlook changed markedly since the completion of the FAPRI long-term baseline, Westhoff said.
 
A worldwide recession led to weak domestic and international demand for many U.S. agricultural products. That weak demand occurred at the same time the farm sector faced production costs exceeding historical averages.  “Hog farmers and dairy producers are enduring a prolonged price squeeze,” Brown said. “Some have used all of their equity and have tapped all of their credit.” Price recovery for meat and milk requires continued growth in consumer demand. In response to low prices, both sectors are reducing what was record production.
 
In the updated FAPRI baseline, prices for barrows and gilts average $57.59 per hundredweight in 2011, up from $42.82 projected for 2009.  In dairy, the all-milk price average goes from $12.47 per 100 pounds in 2009 to $16.37 by 2011.
 
Brown gave a word of caution. As the economy recovers, demand for agricultural products increases, raising prices. At the same time, demand and prices for oil also increase. Oil prices, which hit $145 per barrel leading into the recession, are projected for 2009-10 to average $61.31 per barrel. By 2015, the end of the baseline, the price rises to $94 for West Texas intermediate crude.  For outlook on petroleum prices and macroeconomic assumptions, FAPRI economists rely on IHS Global Insight Inc. a private group.  Based on the oil price rise, ethanol prices at Omaha, Neb., are projected to increase from $1.65 per gallon this marketing year to $1.76 in 2010-11 and to $2.09 by 2015.
 
Corn prices for this marketing year are projected at $3.47 per bushel, down from $4.05 last year. By the end of the shortened baseline, prices are back at $3.98.  Corn plantings continue to rise through the baseline from 88.5 million acres next year to 90.4 million acres in 2014. Added acres come largely from cotton and sorghum plantings.
 
Soybean acres remain stable, going from 77.9 million acres next year to 78 million acres in 2014.  Soybean prices, projected at $9.44 per bushel for this marketing year, decline to $9.12 next year, then rise steadily to $9.74 by 2014.
 
In the cattle sector, Brown said the outlook depends on where you are in the supply chain. Unlike hogs, where production is often coordinated, the cow-calf, backgrounding and feedlot operations remain separate.  “Feedlots have been bleeding red ink for a long time,” he said.  The baseline projects price recovery for fed cattle based on a declining to steady supply. Fed cattle projected at $85 per hundred this year will rise to $93 in 2010 and $98 in 2011. All are based on Nebraska direct sales.  Feeder steers at Oklahoma City are projected at $103 per hundred this year, followed by $115 in 2010 and $123 in 2011.
 
The 11-page 2009 baseline update is available at www.fapri.missouri.edu .
 
The FAPRI baseline serves as reference for comparing what-if scenarios of proposed legislation before the U.S. Congress, including “cap and trade” or “climate change.”  “This update should not be confused with a full FAPRI baseline,” Westhoff said. “This review is less exhaustive and covers only U.S. markets.”  The economists assume that weather remains average and that current policies remain in effect. The baseline does include the policy change allowing USDA to buy dairy products to support prices.  Also, the update recognizes export restrictions on U.S. pork because of the H1N1 virus. Current crop production levels are based on the August 2009 USDA report. Commodity supply, utilization and prices are based on USDA 2008-09 market-year reports.



Soybean Stem Borer Active in Nebraska
Bob Wright, Extension Entomologist, Lincoln
Tom Hunt, Extension Entomologist
Haskell Ag Lab, Concord

Soybean stem borers in a field near Plymouth in southeast Nebraska this week and the resulting damage to leaves.

Damage from soybean stem borer
Injury from soybean stem borer can be found now in some south central Nebraska soybean fields. This beetle (Dectes texanus texanus) has been moving into Nebraska from north central Kansas over the last several years. The last few years soybeans damaged by soybean stem borer have been reported in Fillmore and Clay counties and surrounding areas.

Description
The adult is a gray, elongate beetle about 0.5 inch long with antennae that are longer than the body. Females lay eggs from late June through summer on various plants, including cocklebur, giant ragweed, sunflower, and soybean. On soybean, eggs are primarily laid in the leaf petioles. Larvae feed on the pith and tunnel down into the main stem. Each of four larval stages tunnels up and down the stem.

Damage
Initial damage is seen when larvae tunnel down the leaf petiole and enter the stem. The leaf tissue above this point wilts and dies. If you split the leaf petiole you can see the tunneling and may still see the larva. Economic damage is caused primarily by lodging and subsequent harvest difficulties. Girdling is most severe in earlier maturing varieties, and lodging is most severe in earlier planted soybean. Chemical treatment of larvae is ineffective because the larvae are in the stem; effective chemical control of the adults is difficult due to the extended adult emergence period. Research found that burying borer-infested stubble after harvest can reduce Dectes populations.

Control
Entomologists at Kansas State University have been studying this insect as a pest on soybeans for several years. They have not identified resistance in any commercially available soybean cultivars, and labeled planting time and foliar insecticide applications were not effective. KSU has conducted a great deal of research on this insect. Its reports and extension publications can be found online at Soybean Stem Borer.
Fields with a history of injury or with symptoms this year should be carefully watched during August and September. Fields with extensive stalk tunneling by Dectes stem borer are at risk for lodging and harvest losses, depending on weather conditions. Those fields should be targeted for harvest first to minimize harvest losses due to stem borer injury. In the absence of lodging losses, this insect does not usually cause noticeable yield reductions.



Syngenta stands behind the safety of atrazine

Crop protection products play a crucial role in bringing abundant and affordable food to our dinner tables. Forty percent of the world's food supply would not exist without products like atrazine, a herbicide that helps farmers fight weeds in their corn, sorghum and sugar cane crops.  After 50 years of use, growers have come to rely on atrazine. It is a mainstay of American agriculture. And it is one of the best studied herbicides available today. Safety reviews around the world by the US Environmental Protection Agency (EPA), World Health Organization, Canada, Australia and the UK have all come to the same science-based conclusion—atrazine, as labeled, can and has been used safely.

Atrazine is a critical tool for use in conservation tillage and no-till systems—farming methods that eliminate plowing and/or reduce tillage. Conservation tillage makes cropland much less vulnerable to soil erosion, which is reduced by as much as 90 percent when compared to intensive tillage. When soil erosion is prevented, so is the runoff into our waterways of sediment—identified by EPA as the top pollutant in US streams and rivers.  Farmers would not use a product that puts their own families and communities at risk, and after half a century, who would know better? Today, in part because of atrazine, farmers are able to grow more corn than ever, using environmentally sustainable methods. That means more food to feed a growing population.

Syngenta is a responsible company which takes the stewardship of all our products seriously—and atrazine is no exception. We've gone above and beyond the extensive studies required to register this product to ensure its safe and effective use. And as with all crop protection products, wide margins of safety exist with atrazine.  It's easy to believe fear-provoking claims about our nation's water when all the data and facts aren't presented. Let's be clear - water systems in the U.S. are safe where atrazine is concerned. Over the last three years, no water systems in the U.S. had atrazine levels in their drinking water that exceeded legal limits.

Syngenta is doing its part to ensure agriculture's sustainable use of our water supplies. Agriculture cannot exist without water, and Syngenta is at the forefront of research in drought-tolerant crops and inputs. Examples include drought-resistant maize and sunflower and a variety of sugar beet that can grow in tropical climates. We educate farmers and landowners across the globe on the use of best management practices to improve land management and protect water quality. To learn more about what Syngenta is doing in the critical area of water protection, please visit: http://www.syngenta.com/en/corporate_responsibility/water.html

With 7,000 employees and their families living in communities across the United States, all of us at Syngenta are interested in seeing that atrazine is properly regulated in the water we drink. We are convinced that it is. We stand firmly behind the safety of atrazine.



National Dairy FARM Program Demonstrates High Standards in Animal Care and Quality Assurance

An animal well-being program designed to bolster consumer confidence in the U.S. dairy industry is being launched by the National Milk Producers Federation (NMPF) and Dairy Management Inc.™ (DMI). The new National Dairy FARM Program: Farmers Assuring Responsible Management will demonstrate producers’ commitment to the highest level of animal care and quality assurance.

“The dairy industry has an excellent track record of responsible management practices,” said Jerry Kozak, president and chief executive officer of NMPF. “The National Dairy FARM Program will enhance current operations and instill a sense of confidence in consumers who, more now than ever, want to know that animals are well cared for and that the dairy products they consume are safe, wholesome and nutritious.”

The program, which will become available in the fall of 2009, is voluntary and available to all producers. NMPF is managing the production and dissemination of technical animal care manuals, producer education and training, on-farm evaluation, and third-party verification.

DMI is assisting with producer and industry outreach, and market chain and consumer relations.

“Dairy farmers have been committed to caring for their cows for generations. It’s important for consumers to understand that commitment so they can continue to have confidence that dairy farmers are doing the right thing in their animal care practices,” said Tom Gallagher, DMI chief executive officer.

At the heart of the program is NMPF’s revised “Caring for Dairy Animals” manual, which details best management practices for a variety of animal care issues, including animal health, facilities and housing, animal nutrition, equipment and milking procedures, and transportation and handling. The content of the manual is consistent with the principles and guidelines of the National Dairy Animal Well-Being Initiative, which was introduced in 2008. NMPF is working with dairy animal care experts to assure that the document reflects current practices, animal health concerns, innovations and advances in technology.

Training and informational DVDs will be made available to producers, co-ops and others interested in dairy animal care. A National Dairy FARM Program Web site will include producer education and training.

Once producers have completed the educational component, the next step is an on-farm evaluation by a trained veterinarian, extension agent or co-op field staff member, Kozak said. The producer then receives a status report and, if necessary, an action plan for improvement.

“To protect the integrity of Dairy FARM, we are also developing a third-party verification program,” Kozak said. “We want quantifiable, objective verification that the dairy industry is providing appropriate care for animals. It’s important to remember that the goal of verification is to validate the program, not judge individual producers.”

On-farm evaluations will begin in 2010 and third-party verification will start in 2011. Co-ops and processors may choose to participate in the program to bring consistency to dairy animal care nationwide.

Additional Dairy FARM modules designed to assure the quality, safety and wholesomeness of dairy products will be introduced in the future.

“Our organization whole-heartedly supports Dairy FARM,” said M. Gatz Riddell, Jr., DVM, executive vice president of the American Association of Bovine Practitioners. “The program demonstrates that producers consider proper care for dairy animals a moral imperative. It also provides a credible, verifiable framework for producers to demonstrate that commitment to consumers.”

NMPF has assembled an advisory panel to provide guidance on Dairy FARM. The panel is comprised of dairy experts and industry professionals representing many facets of the industry. Members  include Stan Andre, California Milk Advisory Board; Marguerite Copel, Dean Foods; John Frey, Pennsylvania Center for Dairy Excellence; Virginia Littlefield, Safeway Inc.; John Kennedy, Kraft Foods; Shelly Mayer, Professional Dairy Producers of Wisconsin; Dr. M. Gatz Riddell, American Association of Bovine Practitioners; Allen Sayler, International Dairy Foods Association; and Lynne Schmoe, Washington Dairy Products Commission.



Five Records Fall at 2009 Iowa State Fair Sale of Champions

With a final swing of the gavel, the Iowa Foundation for Agricultural Advancement (IFAA) raised $230,650 for the 14 exhibitors of 4-H and FFA Grand Champions in the Sale of Champions Saturday at the 2009 Iowa State Fair.  Five champion records were broken during the Sale. The Reserve Champion 4-H Market Lamb sold for a record $21,250, besting the previous mark of $13,000. Other new price records included: the Grand Champion 4-H Market Heifer, $28,900; the Reserve Champion 4-H Market Heifer, $21,300; the Grand Champion 4-H Market Hog, $21,100; and the Grand Champion 4-H Broiler Pen, $5,400.

Participants in the Sale of Champions were asked to find hometown supporters to set a floor price for bidding. The purchaser in the auction paid the difference between the floor price and the final sale price. Each participant in the Sale takes home a check for 80 percent of the animal's sale price. The IFAA keeps 20 percent to fund the scholarship program and cover Sale expenses. In addition to their sale earnings, the exhibitors of the Grand Champion 4-H Market Steer, Grand Champion 4-H Market Hog and Grand Champion FFA Market Lamb earn the use of a new aluminum livestock trailer for one year courtesy of Featherlite, Inc., of Cresco.



Iowa Youth Earn $141,850 in Scholarships/Awards at State Fair

The Iowa Foundation for Agricultural Advancement (IFAA) presented $141,850 in scholarships and awards to youth who participated in 4-H and FFA beef, swine, sheep and poultry projects Saturday prior to the Sale of Champions at the 2009 Iowa State Fair.

The ceremony included the presentation of 97 scholarships with a value of $125,750, as well as 88 performance and carcass awards valued at $16,100. When tallied with the Sale of Champions receipts, the IFAA provided $372,500 to young livestock and poultry producers to sustain their interest in agriculture and encourage related careers.