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Monday, November 1, 2010 Two sections Volume 38, No. 44

FarmWeek on the web: FarmWeekNow.com Illinois Farm Bureau®on the web: www.ilfb.org

A NOV. 10 DEADLINE tocomply with U.S. EPA Spill Preven-tion, Control, and Countermeasuresrules faces certain farmers. .............2

PRAIRIE FARMS recentlyl aunched a “Far mer Owned”campaign to highlight the farmfamilies who supply all its milk. ....4

STATE SENATORS this weekare to deal with part of the statebudget deficit that stems from bil-lions in state pension payments. ...3

Ideal harvest conditions interrupted by powerful stormBY DANIEL GRANTFarmWeek

The nearly ideal harvestconditions that persisted formuch of the past two monthswere interrupted last week bya powerful storm that pum-meled much of the CentralU.S.

Wind gusts of 60-plus mphwere recorded over much ofIllinois on Tuesday and thestorm spawned three torna-does in the state, according toJim Angel, state climatologistwith the Illinois State WaterSurvey.

“This is the first time in along time we’ve seen one thatstrong (in the fall),” Angelsaid of the storm. “It wasfueled by warm air to thesouth (that clashed with) coldair to the north. In some cas-es, it set a record for low pres-sure.”

The storm reportedly pro-duced barometric pressurereadings (which are a measureof the downward force the

beans were in the bin as of thefirst of last week.

Farmers in the state hada quick harvest due to sum-mer temperatures that were2 to 3 degrees above nor-mal, a dry August that spedup crop maturity, and nearlyideal fall conditions,

according to Angel.Preliminary numbers on

Friday showed Illinois receivedonly about 1.4 inches, half itsnormal rainfall, for the monthof October while the averagetemperature for the monthwas about 2.5 degrees abovenormal, Angel reported.

atmosphere exerts per unit ofa certain area) similar to a Cat-egory 3 hurricane.

Fortunately, no seriousinjuries or fatalities werereported in Illinois, althoughthere was significant winddamage, and about 75,000electricity customers werewithout power from NorthernIllinois and the Chicago sub-urbs down to southern partsof the state.

Angel compared thestrength of last week’s stormto a powerful system that onNov. 11, 1940 surprised manyresidents of the Upper Mid-west and took the lives of anumber of stranded hunters.

That event is known as theArmistice Day storm, havingoccurred on the anniversary ofthe end of World War I.

Some market analysts pre-dicted the storm last weekcould cut deeper into finalcorn yields.

USDA last month alreadyhad cut its corn productionestimate by about half a billionbushels due to disappointingyields in some areas.

Corn harvest as of the firstof last week was 68 percent

complete nationwide, wellabove the average of 49 per-cent.

However, about 13.8 mil-lion acres of corn remained tobe picked prior to the storm.

There wasn’t much concernabout crops in Illinois, though,as 97 percent of corn and soy-

FOUR-LEGGED GLEANERS

Ag consultant advises:Don’t turn back the clockBY MARTIN ROSSFarmWeek

John Eckley is an ag businessconsultant whose familyacquired its farm in 1946. Hetakes estate tax concerns per-sonally as well as professionally.

Eckley, a Bloomington mar-keting specialist, sees “extreme”worry about impending estatetax requirements among theCentral Illinois producers withwhom he interacts daily.

If Congress fails to act, the

FarmWeekNow.com

Listen to Jim Angel’s commentsabout October’s weather atFarmWeekNow.com.

basic estate tax exemption willdrop back to a pre-2002 $1 mil-lion on Jan. 1, exposing manyIllinois families to increasedfinancial vulnerability.

The exemption reached $3.5million in 2009 before the estatetax was eliminated in 2010;Farm Bureau seeks a $5 millionexemption when the estate taxreturns in 2011.

In an October letter to U.S.senators, the Family BusinessEstate Tax Coalition, whichincludes groups ranging fromthe American Farm Bureau Fed-eration to the National Newspa-per Association, chided Con-gress for failing to pass “mean-ingful estate tax relief ” prior toNovember elections.

The coalition warned that“without a permanent solution,there are no assurances thatthese businesses and familyfarms will continue to operate infuture generations.”

“Our family’s been luckyenough not to hit any of the real-ly major (estate tax) cycles,” Eck-ley told FarmWeek.

“I remember in 1980 mygrandfather was hoping to seeRonald Reagan change theexemption from $60,000 to$600,000.

In his mind, that was huge. Togo backward is absolutely to gothe wrong way.

“I definitely hear farmers talkabout two things. One is estateplanning; the other’s the day-to-day taxation issues, which arepretty significant, as well.”

Beyond estate tax reversion,taxes on dividends are due to

rise to the taxpayer’s top mar-ginal rate — 39.6 percent forcouples making $250,000-plus ayear — from a current 15 per-cent on Jan. 1. And taxes oncapital gains are set to bumpfrom 15 percent to 20 percent.

Amid the administration’scontinued push for what itdeems “middle-class” tax relief,Eckley suggests President Oba-ma and congressional leaders are“very conflicted and confusedabout who is the middle class.”

Because higher-income tax-payers have the resources to cre-ate their own tax “shelter sys-tem,” he argued “it’s the truemiddle-class who gets affected”by the return of the estate tax.

‘I definitely hearfarmers talk abouttwo things. One isestate planning.’

— John EckleyAg business consultant

For more thoughts,see page 16

Angus cattle owned by Rick and Bob Ackerman of Freeport grazelazily in a harvested cornfield owned by the Ackermans’ father, Earl.There was a little ice on the stubble last week as the state experiencedits first hard freeze. Does that mean Indian summer is not far behind?(Photo by Ken Kashian)

POST-ELECTION CONCERNS — Sen.Richard Lugar (R-Ind.) believes a potential powershift in Congress after Tuesday’s election will have amajor impact on U.S. farm policy. “We are likely tohave curtailment of farm subsidies and other incomesupport programs,” Lugar warned.

He noted 70 percent of the USDA’s budget goes tofood and nutrition programs, and those programswill not be touched. But he expects the cuts willcome from farm programs.

Because of this, Lugar believes writing the 2012farm bill will be very contentious. “The South willwant to protect the subsidy programs for cotton, rice,and sugar. My guess is that at the end of the day thesubsidies will be curtailed,” Lugar said.

CNH REOPENS DAMAGED TRACTORPLANT – CNH resumed operations today (Monday)at its tractor plant, training center, and North Ameri-ca parts operation facility in Racine, Wis.

Operations were halted there last week when a tor-nado, part of a massive storm that pummeled theCentral U.S., struck the facility.

The twister damaged the roof, garage doors, andaccess doors and caused significant water damage tointernal ceilings after it triggered the sprinkler sys-tem.

The plant produces Case IH’s latest models ofMagnum tractors.

WATER WORRIES? — Farmers would faceburdensome federal regulatory control if provisionsof a restrictive Senate water bill make it through the“lame duck” session of Congress, according to theAmerican Farm Bureau Federation (AFBF).

AFBF and a coalition of other groups are vowingto oppose any effort to attach the Chesapeake CleanWater and Ecosystem Restoration Act to any bill thatmight be addressed during the post-election session.

“While carrying a title that suggests it is limited inscope, provisions of this bill would have drastic neg-ative impacts on agriculture,” AFBF President BobStallman said. “The bill makes sweeping changes tothe Clean Water Act and sets adverse water policyprecedents that would impact watersheds throughoutthe nation.”

According to Stallman, the bill strips state andlocal governments within the Chesapeake Bay Water-shed of their authority under the Clean Water Actand grants it instead to the Environmental ProtectionAgency.

FarmWeek Page 2 Monday, November 1, 2010

(ISSN0197-6680)

Vol. 38 No. 44 November 1, 2010

Dedicated to improving the profitability of farm-ing, and a higher quality of life for Illinois farmers.FarmWeek is produced by the Illinois FarmBureau.

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© 2010 Illinois Agricultural Association

STAFFEditor

Dave McClelland ([email protected])Legislative Affairs Editor

Kay Shipman ([email protected])Agricultural Affairs Editor

Martin Ross ([email protected])Senior Commodities Editor

Daniel Grant ([email protected])Editorial Assistant

Linda Goltz ([email protected])Business Production Manager

Bob StandardAdvertising Sales Manager

Richard VerderyClassified sales coordinator

Nan FanninDirector of News and Communications

Dennis VerclerAdvertising Sales RepresentativesHurst and Associates, Inc.P.O. Box 6011, Vernon Hills, IL 600611-800-397-8908 (advertising inquiries only)

Gary White - Northern IllinoisDoug McDaniel - Southern IllinoisEditorial phone number: 309-557-2239Classified advertising: 309-557-3155Display advertising: 1-800-676-2353

Quick TakesCOMPLIANCE

USDA-notified producershave compliance optionsBY MARTIN ROSSFarmWeek

When nearly 36,000 Illinois farm programrecipients receive letters seeking U.S. Inter-nal Revenue Service (IRS) documentationand raising the possibility of losing or hav-ing to repay program payments, concernscan arise.

But Derek Struebing, program specialistwith Illinois’ state Farm Service Agency(FSA) office, told FarmWeek producerswho’ve failed to submit or incorrectly filedUSDA-required adjusted gross income (AGI)tax review consent forms will have multipleoptions to restore their program eligibility.

FSA has alerted some 520,000 programparticipants nationwide of the need to sub-mit CCC-927 individual or CCC-928 entityconsent forms within 30 days “to avoid anydelay or interruption in the receipt of pro-gram or payment benefits.” The formsacknowledge USDA can use federal tax datato ensure compliance with 2009/2010 pay-ment eligibility.

The 2008 farm bill required producers toprove AGI compliance every three years,starting with program year 2009. Under anew interagency review procedure, IRS pro-vides names to FSA for further inquiry with-out supplying tax records or specific incomefigures, and FSA gives program recipientsidentified by IRS 30 days to provide third-party verification that they haven’t exceededincome limits.

Program recipients who do not submit927-928 forms receive an initial notice of

non-compliance before incurring any pro-gram penalties.

Producers who received an October letteralready had submitted a CCC-926 AGI certifica-tion form during the 2009 or 2010 programyears. Struebing told FarmWeek IRS will run asecond compliance “cross-reference” with FSAinformation, tentatively in December, beforeUSDA re-notifies producers.

“When we run this second cross-refer-ence, if someone comes back up on this list,they will receive a letter saying they’re ineli-gible for ’09 and ’10 FSA or (NaturalResources Conservation Service) programpayments,” he advised. “At that time, theyare going to owe that money back (toUSDA).

“At some point after that letter, they canregain AGI compliance and eligibility byproviding FSA with a copy of their taxreturns for the previous three applicableyears for ’09 (2005-07) or ’10 (2006-08) andor a certified statement from their CPA orattorney.”

Struebing noted the possibility in somecases that the IRS may have lost or rejectedquestionable consent forms. Producers whoreceived an October letter and who believethey have submitted proper forms to IRSshould consult FSA and resubmit a new 927or 928 form to the IRS as soon as possible.

Producers may find CCC-927/298 formsat {www.fsa.usda.gov/ccc297} or{www.fsa.usda.gov/ccc298} and mail com-pleted documents to the IRS at Box 24033,Fresno, Calif., 93779.

Farmers reminded storageplan deadline is Nov. 10BY KAY SHIPMANFarmWeek

Farmers whose on-farmfuel storage meets certainthresholds must meet theNov. 10 deadline to complywith U.S. Environmental Pro-tection Agency (EPA) SpillPrevention, Control, andCountermeasures (SPCC)rules.

Recently EPA extendedthe deadline for one year,but only for farms that start-ed operation after August2002.

The deadline has beenextended — but the exactdate has not been specified —for facilities that must addressmilk and milk product con-tainers, associated piping andaccessories constructedaccording to currently applic-able 3-A Sanitary Standards,and that are subject to thecurrently applicable Grade“A” Pasteurized Milk Ordi-nance (PMO) or the equiva-lent state regulatory require-ment.

For those facilities, thedeadline will be one year from

the effective date of a finalrelated rule, but that date hasnot been finalized.

While EPA changed thecompliance date for certain“new” farms and dairy farms,farms in operation before2002 already were under therequirements and should havea plan in place or updated byNov. 10.

The SPCC rule pertains tofacilities, including farms,which have above-ground oilstorage with an aggregatecapacity greater than 1,320 gal-lons or completely buried oilstorage capacity greater than42,000 gallons.

Residential home oil con-tainers and oil tanks smallerthan 55 gallons are exempt.

Farms that meet the thresh-old must prepare and imple-ment a plan to be kept at thefarm and have a secondarycontainment structure aroundtheir tanks or use double-walled tanks.

Information needed to pre-pare a plan include:

• A list of the oil containersat the farm, including the con-tents and location of each con-tainer;

• Brief descriptions of theprocedures that will be used toprevent oil spills, the measuresinstalled to prevent oil fromreaching water, and the measuresthat will be used to contain andclean up an oil spill to water; and

• A list of emergency con-tacts and first responders.

For information, the SPCCrules are online at{www.epa.gov/-emergen-cies/spcc}, and a plan templatefor smaller-capacity facilities isonline at {www.epa.gov/ emer-gencies/content/spcc/-tier1temp.htm}.

STATE


BY KAY SHIPMANFarmWeek

The State of Illinois and Illinois Farm ServiceAgency (FSA) are expanding the ConservationReserve Enhancement Program (CREP) toinclude the Kaskaskia River Watershed.

The state will contribute $45 million in capitalfunds over three years for its portion of the vol-untary conservation program. Illinois FSA Exec-utive Director Scherrie Giamanco and IllinoisDepartment of Natural Resources (IDNR)Director Marc Miller announcedthe expansion last week.

Under CREP, participatinglandowners receive rent paymentsand other financial incentives toremove farmland from produc-tion. Since 1998, the program hadbeen limited to the Illinois River watershed. Thelast reopening of the Illinois CREP programoccurred in late 2005.

Signup tentatively will start Dec. 1, accordingto Don King, FSA chief program specialist.FarmWeek will publish additional informationwhen it becomes available.

A total of 105,500 acres in all or parts of 68counties (see map) may be enrolled during thenew signup. The original goal was to enroll232,000 acres, of which 126,500 acres alreadyhave been signed up.

Signup will be continuous and will start simul-taneously in the eligible counties, King said.

The state’s goals are to address water qualityissues and habitat needs, according to DebbieBruce, resource conservation program supportadministrator with IDNR.

IDNR will attempt to target watershed areasthat may have impaired water quality because ofsedimentation and areas that would complete

habitat corridors of bottomland forest, Bruceadded.

Under the program, a landowner signs a 14-to 15-year Conservation Reserve Program(CRP) contract with the federal government.Once enrolled in the federal program, he or shemay sign a 15- or 35-year contract extension or apermanent conservation easement with thestate.

Eligible land must fall into one of two cate-gories:

• Highly erodible riparian areasimmediately adjacent to the 100-year floodplain of the Illinois orKaskaskia rivers or

• Flooded or wetland riparianareas within the 100-year flood-

plain of the Illinois and Kaskaskiarivers and their tributaries,

• If it is to be wetland restored, it must belocated in the watershed and either a farmedwetland, a prior converted wetland, or a wetlandfarmed under natural conditions.

Conservation practices that are availableinclude planting of permanent native grasses,trees, filter strips, riparian buffers, wildlife foodplots, and permanent wildlife habitat. Wetlandrestoration is another available practice.

CREP participants receive incentive pay-ments, annual rent payments, and cost-shareassistance from FSA. Participants in the stateconservation option receive additional cost-share assistance and a one-time lump sum pay-ment based on soil rental rates and the easementduration.

For more information, contact the local FSAoffice or Soil and Water Conservation District.Additional information also will be availableonline at {www.fsa.usda.gov}.

State, USDA expanding CREP to Kaskaskia watershed

FarmWeekNow.com

This weekIllinois Senate plans session on pensionTwo days after the election, state senators

this week are scheduled to deal with part ofthe state budget deficit which stems frombillions in state pension payments.

“The Senate is coming back to con-sider the pension hole in the currentbudget,” said Kevin Semlow, Illi-nois Farm Bureau director ofstate legislation.

“By law, annual pensionpayments have to be, andare being, made. But that istaking general revenuefunds away from otherbills the state has,”Semlow added.

The pension holeis $4.1 billion. Law-makers started dig-ging that hole whenthey passed a budgetbut didn’t appropriateall the necessary fund-ing to cover obliga-tions.

With a one-vote margin, the House had passed SB3514 thatallowed short-term borrowing by issuing bonds. The cost ofissuing the bonds is $1 billion. However, the Senate didn’t takeup the bill, and the matter remained unresolved. They plan toconsider the borrowing plan’s fate on Thursday.

Senators may find the choices remain as difficult in Novem-ber as they did in May. The borrowing measure will require asuper-majority, or 36 votes, to pass, Semlow noted.

If the measure passes, it would be forwarded to Gov. PatQuinn for his consideration. — Kay Shipman

Illinois developing new voluntary programfor recreation access on private property

The Illinois Departmentof Natural Resources(IDNR) will use a $525,250USDA grant to work withlandowners on providingpublic access for huntingand fishing on their proper-ty.

IDNR is planning to workwith landowners in theKaskaskia River and IllinoisRiver watersheds but is stilldeveloping the IllinoisRecreational Access Pro-gram (IRAP), Debbie Bruce,IDNR’s resource conserva-tion program supportadministrator, toldFarmWeek.

Those watersheds are inthe newly expanded Con-servation ReserveEnhancement Program(CREP), which includes astate conservation con-tract. However, IRAP willnot be limited only tolandowners enrolled inCREP, Bruce noted.

Landowners who partici-pate in IRAP will receiveannual payments for accessleases and technical andfinancial assistance toimprove wildlife habitat. In

return, they will provide freeaccess on enrolled propertyto hunters, fishermen, andboaters.

The agency is consideringlegislation that would focuson addressing landowner lia-bility on IRAP-leased land,Bruce explained. IDNR alsois working on liabilitywaivers for participatinglandowners, she added.

At first, IDNR plans tofocus on providing access forfishermen and canoers on theKankakee and Iroquois riversand for youth turkey hunters

and youth deer hunters.IDNR’s goals include pro-

viding access for 100 youthturkey hunters, access on 500acres for youth deer hunters,and walk-in fishing access on200 acres of impoundedwater and five miles of non-navigable streams.

Bruce was not sure whenlandowners will be able tostart enrolling in IRAP.

The state must first com-plete an environmental landassessment, and that maytake four months, she said.— Kay Shipman

Buffer demonstration applicants soughtTwenty Illinois sites are being sought for buffer demonstra-

tions in 2011. Trees Forever and the Illinois Buffer Partnership,which includes the Illinois Farm Bureau and GROWMARK,promotes and showcases the voluntary efforts of farmers andlandowners to develop conservation buffers.

Selected participants will be reimbursed up to $2,000 for halfof the expenses that remain after funding through the Conser-vation Reserve Program or other federal, state, or local fundinghas been applied to the project.

Field days for farmers, landowners, and others will be heldon the sites.

Applications are being accepted through Dec. 31.For more information or an application, contact Debbie

Fluegel, a Trees Forever coordinator, at 309-925-9925 [email protected].

For additional informa-tion on CREP, go toFarmWeekNow.com.

DAIRY


Prairie Farms campaign highlights company’s rootsBY DANIEL GRANTFarmWeek

A new campaign and prod-uct logo recently launched byPrairie Farms Dairy willemphasize the strength of theCarlinville-based cooperative— the farm families who sup-ply all its milk.

Prairie Farms recentlylaunched a “FarmerOwned” campaign toheighten awareness of thecompany’s quality line ofproducts, put a spotlight onits farmer members, andemphasize the fact thatPrairie Farms products are

home state of Illinois.The broad reach allows

Prairie Farms to convert freshmilk into a variety of dairyproducts and have them onstore shelves as quickly as twoto three days after the milkleaves each farm.

Retail dairy products fromPrairie Farms generally areproduced within a 200-mileradius of each store’s location.

“Reducing food miles (thedistance food is transportedfrom farm to fork) benefitsproducers, Prairie Farms, theenvironment, and consumers,”Leinenbach said.

The “Farmer Owned” cam-paign also included thelaunch of television commer-cials, billboard advertising,and trade and web-based pro-motions.

Prairie Farms Dairy wasfounded in Illinois in 1938.The cooperative has grownover the years and last yearposted sales of $2.3 billion.

produced near each areawhere they are sold.

“The new direction empha-sizes the values of ourfarm fami-lies andour com-mitmentto beinggood citi-zens inthe com-munity,”said Ed Mullins,CEO of PrairieFarms.

The new logo has the tradi-tional red lettering for the

company name with a gold“Farmer Owned” bannerabove it.

“It (the new logo) wasdesigned to honor all our

(800-plus)producers,”RebeccaLeinenbach,

sales programdirector for PrairieFarms, told the

RFD Radio Net-work last week during

National Cooperatives Month.Prairie Farms operates 36

manufacturing plants in 11states, including nine in its

Dairy plan fresh farm bill ‘go-to concept’? BY MARTIN ROSSFarmWeek

With farm bill debateapproaching and farm subsi-dies under the budget/policymicroscope, National MilkProducers Federation (NMPF)has devised what it calls a “go-to concept” aimed at bufferingvolatility in dairy production.

NMPF’s “Foundation forthe Future” plan, the productof a cross-regional planningprocess that began in spring2009, would replace currentMilk Income Loss Contract(MILC) and Dairy ProductSupport programs with theDairy Producer Margin Pro-tection Program (DPMPP), amargin “insurance” approach.

Federal support would kickin when a national margin tiedto U.S.-average feed costs andall-milk prices dropped belowa predetermined level. Pro-ducers could buy added “cov-

An accompanying DairyMarket Stabilization Program(DMSP) would reduce milksupplies when producers expe-rience tight margins. NMPF

erage” to protect a higher feedcost-milk price margin.

“The purpose here is notnecessarily to boost farm-levelprices,” NMPF spokesmanChris Galen told FarmWeek.“It’s really to help reduce volatil-ity and protect farmer margins.

“Certainly, the cost of feedhas gotten more variable, andso has the cost of energy. But Ithink a lot of this problem hasjust been volatility in demand.

“We’re much more reliantthan we ever have been in thepast on export markets. Buttwo years ago, the global creditcrunch, the onset of the reces-sion, kicked dairy in the teeth.We saw an important source ofdemand go away for awhile.”

American Farm BureauFederation senior economistBob Young noted the currentdairy program targets a setprice level “that has meant lessas production-cost inflation

continues to work.” The plan has received a

favorable reaction from U.S.House Ag Committee Chair-man Collin Peterson (D-Minn.), who Galen said sees“the value in focusing on mar-gins, and not just pricingassurances.”

But budget will be a key fac-tor in farm bill development,and Young stressed the poten-tial cost of the margin protec-tion plan would depend onfuture nationwide productionand dairy consumption trends.

Galen noted the predomi-nantly domestic fluid milkmarket has remained fairly sta-ble. Foundation for the Futurewould restructure the farmer-funded, voluntary Coopera-tives Working Together pro-gram, currently aimed atreducing milk production andincreasing demand, as anexport assistance program.

OUTSTANDING DIRECTOR

Chenoa dairyman Myron Erdman has been recognized by the Illinois Cooperative Council as its out-standing member director for 2010, the first dairyman to receive the award in more than 20 years.Erdman has served on the boards of directors of the Corn Belt Electrical Cooperative, Associated MilkProducers Inc., and Foremost Farms USA. Erdman and his wife, Neta, operate a dairy with their son,Mark, near Chenoa in McLean County. The Erdman Dairy is a member of the Prairie Farms Dairy co-operative. (Photo by Ken Kashian)

Downs dairyman: NMPFplan seems ‘good move’

Richard Streutker, who milks 90 cows at his McLean Countyoperation near Downs, suggests the National Milk ProducerFederation’s margin protection plan is “probably a good moveforward.”

Streutker, who raises 120 acres of corn entirely to feed on-farm or use for silage, feels any policy shift that would help dairy-men deal with fluctuating feed prices “will be a huge benefit.”

“Say I have to expand or replace some buildings: I can tellmy banker I’m going to have a much more stable price for milkand it will be much easier to forecast profits in the future,”Streutker told FarmWeek.

“All commodities seem to follow corn. When the prices arenot very stable, it’s not a good thing for a guy in my positionwho buys a lot of feed.

“I’d like to see a more stable milk price and a more stablecommodity price. Foundation for the Future is not going tocontrol feed prices, but it would protect us if the price goes up.”

He is skeptical the plan will survive farm bill debate, thoughhe’s buoyed by support among “large herd” interests. Thoseproducers traditionally have addressed low prices by addingcows, but he noted small and larger operators alike sufferedwhen California prices “tanked” last year. — Martin Ross

Scientists make biodegradable plastic from milk protein, clay

Scientists are reporting development of a new ultra-lightbiodegradable plastic foam material made from two unlikelyingredients — milk protein and ordinary clay.

The new material could be used in furniture cushions, insula-tion, packaging, and other products, according to a recentreport in the American Chemical Society journal “Biomacro-molecules.”

David Schiraldi, a professor at Case Western Reserve Univer-sity in Cleveland, Ohio, and his colleagues explained that 80 per-cent of the protein in milk is casein, which is used to make adhe-sives and paper coatings.

However, casein is not very strong and can be washed away.To strengthen casein and boost its water resistance, the scientistsblended in a small amount of clay and a reactive molecule to linethe casein protein molecules together.

The researchers freeze-dried the mixture, removing the waterto produce a light, spongy substance. Then they cured it in anoven and tested its sturdiness.

The scientists concluded the substance is strong enough forcommercial uses, and it is biodegradable, with almost a third ofthe material breaking down within 30 days.

recommends changes in feder-al milk marketing ordersreportedly to create a “com-petitive” milk price and main-tain Class I differentials.

FarmWeekNow.comView Prairie Farms’ latest TVad and listen to our interviewwith a company spokesman atFarmWeekNow.com.

ENERGY


Illinois primed to be producer of next-gen fuels?BY MARTIN ROSSFarmWeek

With public/private energycrop research well under way,blueprints for biomass conver-sion on the boards, and a posi-tive policy/finance foundationalready laid, Illinois appearswell-positioned to help meetU.S. biofuels needs.

So said federal and state offi-cials, ag researchers, and energyentrepreneurs at one of a seriesof nationwide USDA-spon-sored Biofuels Forums lastweek in Bloomington.

The federal renewable fuelsstandard (RFS2) mandates 36billion gallons of annual U.S.biofuels use by 2022, including21 billion gallons of non-cornethanol and other renewables.

According to USDA’s RFS2“regional roadmap,” the U.S.central-eastern region, whichincludes Illinois, is in line tosupply 43.3 percent of that“advanced” biofuels volume,second only to the Southeast.

Participants in the IllinoisFarm Bureau-hosted forumnoted numerous challenges forprospective biomass producersand processors.

switchgrass, prairie grasses, andtropical maize (an outsized cornvariant) at the Dudley SmithFarm in Christian County.

The U of I-supportedEnergy Biosciences Institute isgauging the economic andenvironmental impacts of var-ious energy crops.

Goodfield-based ChipEnergy Inc. hopes soon tobring on-line the first in aseries of local biomass conver-sion facilities that could serveas a platform for future cellu-losic ethanol production.

Further, Illinois FinanceAuthority Director ChristopherMeister, whose agency overseesbeginning farmer and other for-mer Illinois Farm DevelopmentAuthority loan/grant programssees strong state interagencysupport for biofuels develop-ment and bright prospects forfinancing of Illinois biomassfuel plants through loan guaran-tees and grants.

Promising developmenttools include Midwestern Disas-ter Area Bonds, which offerfederally tax-exempt financingto biofuels facilities in 18 Illinoiscounties through 2012.

According to Meister, Illi-nois’ ethanol-biodiesel fuel taxexemption, which encouragessale of higher allowable biofuelsblends, “sets this state apart,”generating $1.1 billion to date in“taxpayer incentives and invest-ment in this industry.”

Danville’s Renewable Ener-gy Group biodiesel facility“continues to be viable” amidwidespread plant closings,thanks largely to the stateexemption, he said.

Industry downsizing hascontinued with congressionalfailure to extend the recentlyexpired $1-per-gallon biodieselblenders credit — “one of thepolicy premises of this plant,”Meister noted. The 45-cent-per-gallon ethanol blenders creditalso is set to expire on Dec. 31.

Meister said he is “discon-certed” by a July CongressionalBudget Office report that“seems to argue for a ratherdramatic drop off in the pro-duction subsidies.”

“Policy uncertainty, policyambiguity probably causedbanks not to lend you money,”he told biofuels interests.“This may ultimately be theright policy, but you’re goingto have to do something thatwill ease this transition from along-established set of subsi-dies to what is a rather dramat-ic upsurge in (biofuels) useand production mandates.

“When those mandatestake effect, we want to haveIllinois producers producingthe feedstock and giving thatfeedstock to Illinois produc-tion facilities — not havingBrazilian ethanol and biodieselcome up the Mississippi (Riv-er) on tanker barges.”

Those include evaluationand development of candidatecrops; sourcing of biofuelsfeedstock “rootstock”; biomassharvest, storage, and trans-portation logistics; infrastruc-ture improvements crucial tomoving biomass to the biore-finery and fuel to key bicoastalmarkets; and producer adop-tion of crops with currentlyuncertain market potential.

That’s on top of a USDA-estimated $168 billion cost tobuild the equivalent of 527 40-million-gallon-per-year biore-fineries needed to convert bio-mass into fuel nationwide.

But USDA Rural Develop-ment State Director ColleenCallahan said Ag Secretary TomVilsack was “very direct aboutthe opportunities” in unveilingnew USDA biofuels initiativesrecently.

She argued a USDA “trifec-ta” — Rural Development, theFarm Service Agency (FSA),and the Natural Resource Con-servation Service (NRCS) — is“here to help.”

Callahan noted USDA fundsare available to help financefund biorefinery startups and

installation of “blender pumps”that offer consumers a choice ofethanol fuels and thus shouldspur increased biofuels demand.

FSA is potentially at theforefront of securing invest-ment needed to encouragefarm biomass production: Itoversees the 2008 farm bill’snewly retailored Biomass CropAssistance Program (BCAP).

“Hopefully, what we can dohere is make matches — intro-duce one kind of person toanother kind of person,” FSAState Executive Director Scher-rie Giamanco related. “There’smoney out here we can borrow.There’s a wealth of technologyavailable that we can put togeth-er and move on.”

USDA’s strategic biofuelsplan ranks the central-easternregion as second only to theU.S. Southeast in advanced bio-fuels production potential.

However, William Bailey,Western Illinois University‘sbiofuels specialist and directorof the university’s school ofagriculture, noted the central-eastern region has received onlyabout 7 percent of the $240-some million in BCAP fundsallocated to date — “about halfof what California hasreceived.”

But biomass progress is beingmade, from long-term miscant-hus trials conducted by Pesotumproducer Eric Rund to USDAtrial production of miscanthus,

Farm bill conservation title key to Illinois fuel biomass?

The next farm bill could offer important inroads for Illinoisbiomass producers, according to Bill Gradle, state conserva-tionist with USDA’s Natural Resources Conservation Service(NRCS).

Producer adoption of biomass crops such as switchgrass,miscanthus, and prairie grasses, as well as collection of cropresidues for biofuels conversion, could depend heavily onevolving conservation policies and practices, Gradle toldFarmWeek at last week’s USDA biofuels forum in Bloomington.

Eric Rund, a Pesotum farmer who began experimentingwith miscanthus production after visiting German and Austri-an energy crop producers, notes the perennial grass “can dowell on poor ground.” That suggests Conservation ReserveProgram (CRP) acres as fertile ground for miscanthus, but henoted growers currently can’t plant it in CRP filter strips.

Rund argues “we need to change that,” possibly allowinggrowers to forfeit CRP payments in exchange for periodicallyharvesting energy grasses. He sees energy crop profits as afair tradeoff for keeping important conservation practices inplace, warning that “if you see $6 corn, you’re going to see alot of land come out of the CRP.”

Gradle sees opportunity for biofuels-friendly changes inconservation programs coming in 2012.

“The House and Senate Ag Committees are both startingto have hearings for our next farm bill,” he said at the USDAforum. “If anything’s going to happen, by law, that’s where it’sgoing to happen. Folks in this room will have a chance tomake a difference in those hearings.”

Gradle noted NRCS’ plant material center in Elsberry, Mo.,has been conducting switchgrass and miscanthus trials toidentify “the best varieties and the best vegetative stock.”

NRCS will monitor plans to harvest corn and other cropresidues for biofuels production. Farm conservation compli-ance requires leaving at least 30 percent of residues on high-ly erodible soils, but Gradle sees “plenty of leeway” in remain-ing stalks and stover and believes that if growers coordinateresidue harvest with their district conservationist, “things willwork out just fine.”

NRCS officials also are eyeing woody biomass speciesthat could provide dual economic and environmental benefits.

“Illinois does have a pretty good, sizable forest in thesouthern part of the state, where I think there’d be an awfullot of potential for biomass — poplar, willow,” he said.

“We’re not going to do anything with the Shawnee NationalForest, but we do have a lot of private forest land in the south-ern and western parts of the state.” — Martin Ross

Bernie Walsh, Durand, Winnebago County: The 2010 har-vest is nearly complete here inWinnebago County. We finallygot some welcome rain lastweekend (Oct. 23-24) for the firsttime in more than a month, butthat has all soaked in, and field-work has resumed. About 10percent of the corn is left, but

that will be done as soon as there is room inthe elevators to get rid of it. It has been avery good year for us, and we know we arethe lucky ones this year. There was someflooding near the Pecatonica River in earlyAugust from heavy rains, but other than that,we had excellent crops. The beans were thebest we’ve had in 10 years and the corn wasvery good also. It should be a very goodThanksgiving this year, and I look forward toreporting to you again next year.

Pete Tekampe, Grayslake, Lake County: Got a little morethan 1 inch of rain for the week.It sure helped the wheat. Thefields looked really greenThursday, but with the tempera-tures in mid-20s this Fridaymorning, it doesn’t look quite asgreen. It was a very good year inLake County for corn and

beans. Some great yields, but some verypoor yields in the low areas. Personally, Iwould take a year like this every year.Thanks again for the opportunity to be aCropwatcher for this year. Have a safe andhappy holiday season.

Leroy Getz, Savanna, Carroll County: The dry weatherended with 3.9 inches of rainfrom Oct. 23 to 26. Fifty mphwinds flattened most of the final1 percent of the corn left infields. Temperatures Fridaymorning were in the low 20-degree range, giving us a hint ofwhat is yet to come. Summingup the year, corn yields were

good to excellent; bean yields were on theexcellent side. Hay quality was down withJuly rains and much flooding. Milk priceshave been up for the year, and grain pricesmoved up rapidly at harvest time. It was ayear marked with tragic accidents. Hope2011 is better.

Ron Frieders, Waterman, DeKalb County: Harvest ispretty much complete. Anunusually large amount of limewas applied this fall. Tillage andanhydrous applications contin-ue but are winding down. Afterskimming 16 years of myCropwatcher notes, it’s clearevery year is different. Different

weather, different yields, different prices,and different world events that affect U.S.farmers. If you visit with senior farmers, yourealize there have always been challengesin farming, and you will always find a way topersevere.

Larry Hummel, Dixon, Lee County: It’s time to put thewraps on another season ofCropwatchers. Looking backover the past growing season,several things stand out. With theexcessive rains we had this sum-mer, the hills of NorthwesternIllinois were a true blessing.Excess water was channeled

into the rivers and sent on its way, allowingthe soils to breathe a little between down-bursts. That advantage showed up in the binwith 200-bushel corn and 60-plus bushelsoybeans. Corn yields were fairly consistentbetween varieties and cultural practices.Soybeans, on the other hand, had huge dif-ferences of up to 25 percent between vari-eties and in side-by-side comparisons. Asthis season starts to wind down, I amalready looking forward to next year. Seeyou then.

Ken Reinhardt, Seaton, Mercer County: This is the lastreport of the season. It is fittingthat as I write this the growingseason is ending with the firsthard freeze. Even July replantedcorn was able to make it this year.Just a few late-planted beans anda few cornfields remain to be har-vested. Some have left corn to fill

November sales contracts. The high windsdidn’t seem to hurt the standing corn much.Two to three inches of rain really helped soft-en the ground for tillage.

Joe Zumwalt, Warsaw, Hancock County: The harvestof 2010 is nearly in the recordbooks and so is the growingseason … thank the Lord!What a year! Several produc-ers are wrapping up harvestand tillage and many are toy-ing with the idea of beginningto apply fall ammonia. Rainfall

totals for the county ranged from 30 to 40inches above the normal 34 inches for theyear, and we still have two months of 2010yet to go. Mother Nature sure presentedsome challenges this year, but for themost part, we have withstood the punchesand will be here to take whatever shethrows at us next year. It has been a plea-sure for me to bring you the crop newsfrom western Hancock County (easternMissouri) and I thank you for reading myshort, sometimes weekly crop report. Ilook forward to the 2011 crop season.Have a safe and happy winter and holidayseason.

Ron Moore, Roseville, Warren County: We had 1.5 inchesof rain last weekend (Oct. 23-24)and it was very welcome. Afterthe rain, lots of anhydrous wasbeing applied. We are almostdone with tillage now and thenwe can get ready for winter. Wemight even have time to dosome of the projects that we

planned to do in August that got delayedbecause of the earlier-than-expected har-vest. We are getting a good start on a morenormal season for next year with the abilityto eliminate some compaction and fill in rut-ted areas in many of the fields that had watererosion. Have a great holiday season andgood luck next year.

Jacob Streitmatter, Princeville, Peoria County: I finishedharvest last week, which isaround the same time I startedharvest last year. This year, cornhad moisture readings around 20percent as we started harvest.Last year, I started corn withmoistures around 36 percent. Ifinished harvest with the moisture

at 11.7 percent. There are a few fields of cornstanding, a lot of fall tillage is in progress,and some had started to apply nitrogen lastweek. Have a safe fall and we all shall seehow next spring goes. Hopefully, when I writemy next article, I will have a lot of corn in theground.

Tim Green, Wyoming, Stark County: Harvest is pretty wellcomplete. Fertilizer availability isstarting to get on the tighterside. Some of the fertilizer peo-ple have to wait on certainfields, bean fields mostly, toapply fertilizer mostly becauseof a lack of potash. Nitrogenapplication started in the middle

of the week after the rain that we greatlyneeded. We ended up with about 1.3 inches,which is the most rain we’ve had in a longtime. Overall the crop was a little disappoint-ing, but it could have been worse. At least itwas dry. We had a pretty decent year. Ienjoyed being a Cropwatcher. Everyonehave a safe winter and spring and I’ll talk toyou later.

Mark Kerber, Chatsworth, Livingston County: As Ireport this last Cropwatchers‘report, we can look back athow 2010 was different. First,we planted the corn timely.Then it rained. Then camesoybean planting. Then a lotmore rain. Then summerapproached with heat and

drought setting in, leading us to an earlyharvest. Yields were lower, but stillrespectable with these higher prices.Farm work is pretty much completedexcept for waterway and tiling projects. Isee a small amount of NH3 going on, butnot as much as other years. This tells usthat 28 percent is just as cheap. The sup-ply of corn is down, as there are fewercorn piles around the elevators. Also, freedelayed pricing is starting soon. Be pre-pared to pay even higher taxes if the Bushtax cuts aren’t reinstated. Also, one hadbetter stay healthy after Jan. 1, or the“death tax“ will take the farm that tooklifetimes to pay for. Have a great winter,and we will see you at the Peoria FarmShow this year.

Ron Haase, Gilman, Iroquois County: Technology is greatwhen it works, but our tractor isnow down waiting for a softwareupgrade. This software problemand the strong winds of the pastweek delayed our tillageprogress. We are waiting on dryfertilizer to be applied on morefields and the return of our

largest tractor. The year 2010 was almostcompletely opposite of 2009 as far as cropdevelopment and weather are concerned.This year was a record early harvest follow-ing a record late harvest in 2009. What willthe 2011 crop year be like? The local closingprices for Oct. 28 were: $5.55 for nearbycorn, $5.64 for January corn, $4.97 for fall2011 corn, $11.98 for nearby soybeans,$12.15 for January soybeans, and $11.30 forfall 2011 soybeans. Where will these bids bewhen the Cropwatcher reports return nextspring?

Steve Ayers, Champaign, Champaign County: A wildweather week with a whole lotof huffing and puffing going on!Storms rumbled throughSunday and Monday nights(Oct. 24-25) into the windyTuesday with 60 mph gusts. Notmuch moisture with 0.15 of aninch of rain Sunday and 0.45 of

an inch of rain Monday night. Wind down-bursts snapped power poles like twigs, tookoff roofs, and damaged trees as the coldfront moved through. We had a hard freezeThursday night with temperature at 26degrees at 4 a.m. Soil temperatures are at50 and tool bars and tanks are being deliv-ered. Farmers are tilling, tiling, fertilizing, lim-ing, doing conservation work, mowing, soiltesting, and prepping equipment for storage.Happy trails to you, until we meet again!

Wilfred Dittmer, Quincy, Adams County: It looks likeanother growing season hascome and gone, and since thereis hardly any crop left in the fieldto watch, I guess we will justhave to watch the crops in thebins. And that is pretty importantas the temperatures get colderlike they were Friday morning

with the thermometer at 28 degrees. Rainfallsince our last visit totaled about one inchover last weekend and into Monday (Oct. 24-25). Total precipitation for the summer comesin at 31.35 inches with a high of 5.5 inchesfor June, 10.1 inches for July, and 5.6 inchesfor September. So overall, I guess the sea-son was pretty good with all the rainfall, lateplanting, and numerous replanting. The fallwas nearly perfect to get it all gathered in,and the prices are good. We really do have alot to be thankful for. So here is wishingeveryone well for reading my comments, andperhaps we will visit again next season.Happy holidays to all.

Tom Ritter, Blue Mound, Macon County: It was a wonderfulfall season with a lot of fieldworkdone. Corn yields were all overthe board depending upondrainage and nitrogen, but for themost part, farmers seem verypleased. Soybeans were thepleasant surprise, with a lot farm-ers saying this was the best soy-

bean crop they have ever raised. The commonword was 70 bushels per acre. A lot of tillagework has been done partly because of timeand partly for compaction and tillage that didnot get done last year. Anhydrous ammoniatanks are just starting to roll. Soil temperaturethe last two days on my thermometer hasbeen stuck at 63. Farmers feel that the fore-cast is for a cooling trend and are starting thatoperation. Overall, it has been a great season.

Jimmy Ayers, Rochester, Sangamon County: We receivedno rain for the week. Fridaymorning was our first real freezeas the temperature dipped downto 27 degrees and frost coveredeverything. As we finish up our2010 production year, we are stillon a mighty roller coaster ride forour pricing. Our thoughts go with

those people who had injuries and sickness-es this fall. Most of the ground work has beencompleted in Sangamon County and sur-rounding areas. There is still a little moreanhydrous being applied. I haven’t seen a lotof wheat that is up yet, but there was someplanted. Hope everyone has an excellentremainder of 2010.


CROPWATCHERSFinal report of the season

Dan Meinhart, Montrose, Jasper County: It was 26degrees Friday morning withheavy Jack Frost. For most, thegrowing season has ended. Thevast majority of harvest is com-plete. Tuesday morning a halfinch of rain fell accompanied bystrong winds blowing downsilos, damaging buildings,

uprooting trees, blowing a grain leg down ata local elevator, and damaging the roof of anearby school. There was a large area with-out power for several hours. Farmers arebusy spreading fertilizer and lime, workingon waterways, cleaning out ditches, and fix-ing washouts, along with fall tillage.Temperatures this week are expected torange from the 30s to the 60s. Everyonehave a safe and enjoyable winter.

Kevin Raber, Browns, Wabash County: We finally receivedrain this past week. Amountswere varied widely because thewind blew so hard. I don’t knowif it went in the gauge or blewover the top of it. Hopefully, it willbe enough to germinate thewheat crop. I find it hard to sum-marize this past growing sea-

son. Let’s just say it is one that will beremembered for a long time. But, as always,I feel blessed with what has been given tous.

Dean Shields, Murphysboro, Jackson County: We final-ly got 0.5 of an inch of rain orso. First rain we have had in along, long time. It helped thewheat crop – it seemed to perkup right away. Harvest is prettywell done. There is still somegoing on, but not much. Overallthe corn is down in yield and

the beans, too. So, we will have try a littleharder next year. Since the rain, the wheatcrop is looking pretty decent, and I wouldsay we have about the normal number ofacres of wheat — not any more than nor-mal. One interesting thing: One farmer triedsome sunflowers. He planted late becauseof how many other crops flooded out andthen the storm the other night camethrough and blew half the sunflowers down.It was a tough year for him. Hope everybodyhad a safe harvest.

Ken Taake, Ullin, Pulaski County: It’s my final report ofour 2010 crop year. It was achallenging year that went fromwet early with a lot of replant-ing, to hot and dry from Julythrough harvest. At least har-vest was early and there wasno mud to fight. Corn and soy-bean yields were probably 20

to 25 percent below our average. Wheat isstill struggling to emerge from the dry soils.After a challenging year, I’m really ready towrite off 2010 and look forward to 2011.Please have a good winter and enjoy sometime off.

Doug Uphoff, Shelbyville, Shelby County: Our lastFarmWeek report. I really appreci-ate comments (good and bad) fromgrowers across the county andsometimes neighboring counties.We really haven’t done much sincelast week. We are wanting to applyanhydrous and may try today(Monday). The only thing that will

possibly work is disked bean stubble. There is noway it can go on the flat black chiseled groundbecause of the lack of moisture. We received 0.2of an inch of rain last week, but with the wind thatwas gone before it got here. Wheat stands arepatchy. Some are good; some need a rain. Yieldswere down in corn and up in soybeans, accord-ing to 5-year average anyway. Values in the fer-tilizer industry are climbing dramatically. I thinkthe managers of that industry can’t wait untilgrain prices go up so they can jack prices up.The only price to come down from last year isseed cost. Farm diesel, $2.675; soy diesel,$2.62; truck diesel, $3.151; truck soy, $3.079;gas, $2.82; town, $2.79; cash corn, $5.60;Decatur, $5.65; December corn, $5.64; Januarycash, $5.70; Decatur, $5.75; beans cash,$11.97; Decatur, $12.07; November cash,$12.03; Decatur, $12.13; December cash,$12.08; December Decatur, $12.18; Januarycash, $12.08; January Decatur, $12.18. Decaturbids have had trucking taken off. Shake a veter-an‘s hand. Veterans Day is coming up andbecause of them we enjoy the freedoms we takefor granted.

Bob Biehl, Belleville, St. Clair County: It’s the last report-ing date, and for once in ourcounty, harvest is done and fer-tilizer and fieldwork are on thedownhill slide. After last year’slate harvest and this year’s earlyplanting spring, this winter willbe a good time to catch up onthe unfinished jobs, equipment

repair, etc. In summary, bean yields through-out the county and area were pretty decent— upper 40s to low 60s — and most every-one was pleased, especially after figuring therise in prices. On the corn front, yields didvary quite a bit — 100 to 200 bushels peracre because of a prolonged dry spell in Juneand July in the southeastern part of the coun-ty. There was a fair amount of wheat sowed inthe county, but limited wheat supply, risingcorn and bean prices, and wheat’s uncertain-ty on final yield and especially quality, put adamper on the acres sowed. Have a safe andjoyous fall, winter, and holiday season.

Rick Corners, Centralia, Jefferson County: Hope youbrought in the brass monkeysFriday morning. Had some rainearly Tuesday morning and alsosome strong wind gusts. The rainvaried from 0.8 of an inch tonothing in just a few miles. Hopeit brings the wheat up. Sure don’tsee anything peeping through

yet. Haven’t seen one wheat field that isdecent enough to make a stand. Harvest ispretty much like the Yankees — over untilnext year. See ya all in the funny papers.

Todd Easton, Charleston, Coles County: Finally, ourlong lost friend rainfall cameback into the area for a briefvisit Tuesday morning calmingthe dust and putting a halfinch in the rain gauge. It wasgreat to get something, but wecould sure take at least anoth-er inch. Area producers are

caught up and looking for things to do.Who would have imagined that at this timelast year? Everyone is extremely anxiousto begin fall ammonia application and afew, as always, have jumped the gun andgone over a few fields already. I hope thecooler weather, promised by forecasters,comes in to help them keep most of theirinvestment in the root zone where itbelongs. One thing that cannot be stressedenough is to use extreme caution whenyou are around anhydrous ammonia. Giveit the fear and respect it deserves. It hasbeen a pleasure to report a much lessstressful Cropwatcher season this year,and best wishes for everyone in the com-ing year. See you again next May.

David Schaal, St. Peter, Fayette County: It’s chilly hereon this Friday morning with lotsof Jack Frost around and thetemperature sitting on 30degrees. Can’t say it wasanother totally dry week aroundhere because we received 0.5of an inch of rain earlier in theweek that came in two different

showers. This is the final report for 2010.It’s been another interesting and differenttype of year, from a lot of rain in the springand early summer, to real hot and dry hereat the end of the fall going into winter.Everyone have a happy holiday and rest of2010, and best wishes for the 2011 grow-ing season.

Ted Kuebrich, Jerseyville, Jersey County: This hasbeen a harvest for the recordbooks weatherwise, that is.We had the driest weather forharvest that anybody canremember. I think there mayhave been one little rain show-er that stopped the combinesfor a day, but for the most part

it was perfect. The corn yields on mostfarms were from 150 to 240 bushels peracre. In fields that had poor drainage, theyields were not as good. The beans yieldswere from 40 to 75 bushels per acre, someof the best yields the county has seen. Thewheat is up and needing rain. TemperatureFriday morning was 31 degrees. Prices atJersey County Grain, Hardin: cash corn,$5.62; January 2011 corn, $5.70; cashbeans, $12.02; January 2011 beans,$12.39.

Page 7 Monday, November 1, 2010 FarmWeek

CROPWATCHERS

Reports received Friday morning.Expanded crop information available at FarmWeekNow.com

Harvest winds down

ICGA leader: Corn supply adequate; more acres neededBY DANIEL GRANTFarmWeek

Farmers in Illinois com-pleted harvest in record ornear-record time and havebeen able to get a good deal

of fieldpreparationwork donefor next sea-son.

Andthat’s agood thing,according toTim Lenz,

president ofthe Illinois Corn GrowersAssociation. Farmers nextyear may need to plantmore corn to keep up with

“The heat (in August) did-n’t help, either,” he contin-ued. “It took away kerneldepth.”

On the plus side, rapiddry-down of the crops andnearly ideal weather condi-tions allowed farmers tocomplete one of the fastestharvests in years.

Corn and soybean harvestin the state as of the first oflast week was 97 percentcomplete compared to thefive-year averages of 63 per-cent for corn and 75 percentfor beans.

Now, it’s up to the cropmarkets to help farmersdecide what mix of crops toplant next year.

“Combined acreage ofcorn and soybeans may needto increase by 4 million to 5million acres or more in2011, depending on the mar-ket’s assessment of yieldrisk,” said Darrel Good, Uni-versity of Illinois ag econo-mist. “High prices of othercrops suggest there will becompetition for acres in2011.”

U.S. corn plantings thisyear totaled 88.2 millionacres, 1.74 million more than2009 but 5.3 million fewerthan in 2007. U.S. soybeanplantings this year were arecord-high 77.71 millionacres, up 263,000 acres com-pared to 2009.

demand growth.The International Grains

Council (IGC) last weekincreased its world corn con-sumption forecast for2010/11 by 3 percent com-pared to 2009/10. IGC alsoprojected ending stocks ofcorn could fall to a four-yearlow.

“It is looking like we’llneed a few (million) moreacres of corn next year,”Lenz said. “If we have aver-age weather, the yield trend isstill up.”

The possible need formore corn acres next yearcropped up due to strongerdemand (the U.S. Environ-mental Protection Agency

recently raised the amount ofethanol that can be blendedinto gasoline for some vehi-cles, and cattle and poultryinventories posted recentgains) and lower-than-expected yields this year inthe U.S.

USDA last month cut itsU.S. corn production forecastfrom 13.2 billion bushels to12.7 billion bushels.

“In my area (Shelby Coun-ty), it was more the wet June(that took the top end offcorn yields),” Lenz said.“Plants in low areas lostnitrogen, (excessive mois-ture) restricted roots, orplants got behind and nevercaught up.

Tim Lenz

MARKETS


No clue on farm energy improvements? SEDAC has the answers BY KAY SHIPMANFarmWeek

Farmers and rural busi-nesses seeking ways to cuttheir energy bills andbecome more energy effi-cient can find answers at theSmart Energy Design Assis-tance Center (SEDAC) atthe University of Illinois,Champaign.

The savings will startwith the first phone call –all SEDAC services are free.

“Many people don’t havea clue where to start withenergy efficiency (ques-tions),” said Ron Fournier,SEDAC managing director.“There are tremendousopportunities out there.These are the glory days ofenergy efficiency.” Fournierspoke at the 2010 IllinoisEnergy Expo last week inNormal.

“Energy prices will con-tinue to be volatile,”Fournier warned. “Don’t belulled to sleep. We’ve gotsteady oil prices, but assoon as the world recovers

from the recession, you’llsee oil prices go up.

“Natural gas looks like itmight be fairly stable(prices) for awhile,” he not-ed.

SEDAC offers four levelsof services, ranging fromquick answers to simplequestions to an in-depthbuilding energy analysis anddetailed recommendationscompiled in a writtenreport.

Since September, SEDAChas launched and/or com-pleted more than 3,700 ser-vices on all types. If all ofthe SEDAC specialists’ rec-

ommendations were imple-mented more than 1.8 mil-lion British thermal units inenergy usage would besaved, reducing energy costsby $28 million, Fourniersaid.

After working withSEDAC, an owner of a typi-cal building can reduce ener-gy use by 31 percent andenergy expenses by 30 per-cent. The average annualsavings is $50,442.

SEDAC also will assessnew building designs forenergy efficiency. On aver-age, the design recommen-dations reduce energy usage

by 38 percent and energycosts by 37 percent. Theaverage annual saving is$50,627, he said.

Fournier noted the dollarsavings is similar to an olderbuilding because a newbuilding design initiallywould use less energy com-pared to older structures.

Although SEDAC isinterested in working withthe agriculture sector, it sofar has assessed mostly graindryers.

“We would assess live-stock buildings, but we

haven’t done any yet,”Fournier said.

In addition to providingone-on-one assistance,SEDAC also publishes ener-gy-conservation fact sheetsfor different sectors andprovides outreach programs.

“We want to help thebusiness and the public sec-tors identify opportunitiesto save money,” Fourniersaid.

For information, goonline to {www.sedac.org},call 800-214-7954, or [email protected].

‘We want to help the busi-ness and the public sectorsidentify opportunities to savemoney.’

— Ron FournierSEDAC managing director

Foglesong: GIPSA rule could create generic beef market in U.S.BY DANIEL GRANTFarmWeek

Cattle producers aren’t the only ones who could take aneconomic hit if new regulations proposed by USDA’s GrainInspection, Packers, and Stockyard Administration (GIPSA)

are added to the Packers and StockyardsAct of 1921.

Consumers could end up paying higherprices for fewer beef selections if the newGIPSA rules take effect, according to SteveFoglesong, president of the National Cat-tlemen’s Beef Association and a producerfrom Fulton County.

The new rules seem to take aim at packerownership of livestock in an effort toaddress concerns about a lack of competi-

tion among packers.The GIPSA rule infers all cattle will be valued on an

average or standard price, regardless of quality. Any devia-tion from the standard price must be justified to the gov-ernment, which could lead to litigation that livestock buyersseek to avoid, according to the NCBA president.

“This will lead to a generic market and generic product,”Foglesong said. “Where would the incentive be for produc-ers to make investments in higher-quality products?”

Foglesong said packers have indicated to NCBA the newGIPSA rule will make it tougher to offer premiums to pro-ducers, the NCBA president said.

Cattle producers under the regulations would have tofocus their business models squarely on feed efficiency andrate-of-gain in their herds, which are sound strategies tomake money, the NCBA president said.

“But we’ll be giving up quality grades to get to thatpoint,” Foglesong said. “That’s where it really comes backto the consumer.”

A recent study commissioned by the American MeatInstitute concluded the new regulations would increaseretail meat prices nationwide by about 3.3 percent.

Higher meat prices could lead to about a 2 percentreduction in consumption, which then could lead to theelimination of about 104,000 jobs in the meat production,processing, and food industry, the study suggested.

Meanwhile, the regulations, which are aimed at competi-tion issues, actually could make the situation worse bypushing some small producers and packers out of businessdue to higher costs and reduced returns, according toFoglesong.

“It will drive further consolidation in the packing indus-try,” he said.

Foglesong again called on USDA to conduct a morethorough economic review of the new regulations beforeimplementing them. USDA last month ignored a similarrequest from 115 members of Congress.

“Ultimately, (the new GIPSA rules) would turn the clockback 50 years,” Foglesong said. “We deserve a full-blowncost-benefit analysis.”

Steve Foglesong

RURAL ISSUES


SOYBEANP R E M I U M S . O R G

Growing Specialty Soybeans Makes More “Cents!”

Increasing your profit doesn’t always mean increasing the amount of land devoted to soybeans. By selling differentiated soybeans, you can bring in extra revenue without having to expand acres. Customers are looking for quality soybeans, and farmers choosing to grow unique varieties can receive a higher return price. Isn’t it time you looked into getting more per bushel?

Visit soybeanpremiums.orgto see what premium programs are in your area.

Funded by the soybean checkoff.

Stover bale project raises biomass storage issuesBY KAY SHIPMANFarmWeek

Current technology andmanagement practices do notprevent moisture problems incorn stover intended for use inthe biomass industry, anArcher Daniels Midland(ADM) researcher reportedrecently.

Mike Cecava, director ofADM’s feed technology

research, discussed the resultsof a two-year project to testtechnology and practices toharvest, store, and processcorn stover in Iowa.

ADM, Deere & Co., andMonsanto Co. have workedcooperatively on the project.

Cecava spoke at a recentforum at the University of Illi-nois’ Center for AdvancedBioEnergy Research.

Moisture levels in the stoverbales proved to be one of thebiggest problems, according toCecava,

Stover with moisture levelsbetween 21 and 35 percentcaused problems for the grind-ing equipment.

The slimy material cloggedthe grinding screens and thenoozed onto the facility floor,he explained.

Researchers tried differentcombinations of plastic andnet wraps and multiple layersof wraps.

They wrapped bales individ-ually and as a group. Somebales were stored under a tarpin a barn.

Tests were conducted onboth round and square bales.

“Bale moisture varied with-in and across cornfields,”

Cecava said. Moisture levelsalso varied within single bales,he added.

The project has shownpractical storing and processissues remain, Cecava said.

“If you put stover under abarn or a tarp, you can main-tain moisture content.

However bales in the netwrap will gain moisture —even (plastic) tube-wrappedbales were not significantlyprotected,” Cecava explained.

Biomass processors won’thave problems processingstover at 20 percent or lowermoisture levels, he said. Like-wise, processors could useanaerobic methods to processstover with moisture levelshigher than 35 percent, hesaid.

But stover with moisturelevels between 21 and 35 per-cent cause significant process-ing problems, and researchersare still searching for the mostefficient and economic storagemethods.

“My conclusion is thatdamp stover is going to be areality for us (biomass proces-sors),” Cecava said.

USDA loans, awards to boost business lending, provide off-farm incomeUSDA Deputy Secretary

Kathleen Merrigan last weekannounced four Illinoisgroups were among recipientsin 36 states to receive funds tomake loans to boost smallbusiness development, createjobs, and provide more off-farm income opportunities.

The money is providedthrough the Rural Microentre-preneur Assistance Program(RMAP) that was authorizedin the 2008 farm bill.

“This program createsopportunities for small busi-nesses to prosper by givingthem access to capital and italso helps to create new off-farm income opportunitiesthat help to support owners ofsmall and mid-sized farmoperations,” Merrigan said.

Four Illinois recipients will

receive a total of $1.45 millionfor revolving micro-loan pro-grams and $272,500 in grantsto provide training and techni-cal assistance for micro-enter-prises.

The funding will affectAlexander, Clay, Effingham,Fayette, Franklin, Gallatin,Hamilton, Hardin, Jackson,Jasper, Jefferson Johnson,Marion, Massac, Perry, Pope,Pulaski, Randolph, Stark, andUnion counties.

Southern Illinois Coal BeltChampion Community Inc.will receive a $500,000 loanand $105,000 grant.

It will partner with South-ern Illinois University‘s officeof economic and regionaldevelopment to provide tech-nical assistance to rural smallbusinesses. The economic

development organizationserves 12 counties in South-Central and Southeastern Illi-nois.

Stark Co. Economic Devel-opment Partnership will use a$150,000 loan and $37,500grant to retain, expand, andattract businesses to StarkCounty.

Southern Five Develop-ment Corp. will use a$500,000 loan and $105,000grant to encourage businessstart-up and expansion in itsservice area’s retail, commer-cial and manufacturing sec-tors.

It will offer prospectiveborrowers free access to edu-

cators and/or one-on-oneconsulting.

South Central IllinoisRegional Planning and Devel-opment Commission will usea $300,000 loan and $25,000grant to support micro-entre-preneurship in its five-countyservice area.

It will partner with PostOak Flats Resource Conserva-tion and Development and theUniversity of Illinois Exten-sion in Effingham County tohelp micro-borrowers andmicro-enterprises.

For more information,go online to {www.rur-dev.usda.gov/BCP_RMAP.html}.

Farmers may donate to localnon-profits via Monsanto fund

Illinois farmers in 96 coun-ties may be able to designatedonations to local non-profitorganizations by participatingin Monsanto Fund’s America’sFarmers Grow Communities.

The program offers farmersthe opportunity to designate a$2,500 donation to theirfavorite local nonprofit orga-nization.

“I signed up to support thelocal FFA chapter and to helpthem prosper,” said SteveRogge, a Roanoke farmer. “Ibelieve in anything that helpssupport youth in agriculture.”

The program benefits non-profit community groups, suchas ag youth organizations,schools, and other civicgroups. In Illinois, the Mon-santo Fund expects to donate$240,000 in 96 counties. TheMonsanto Fund is the philan-thropic arm of the MonsantoCo.

Farmers may apply online at{www.growcommunities.com}or by calling 877-267-3332.Eligible farmers must be atleast 21, actively engaged infarming a minimum of 250acres of corn or soybeans, or40 acres of open-field vegeta-bles or at least 10 acres oftomatoes, peppers and/orcucumbers grown in protectedculture. The application periodcontinues through Dec. 31.

No purchase is necessary toenter or win. In Illinois, onewinner will be drawn fromeach of the state’s 96 partici-pating counties. MonsantoFund will announce winningfarmers and recipient organi-zations in February.

For a copy of the programofficial rules, go online to{www.growcommunities.com}or send a written request toEileen Jensen, 914 Spruce St.,St. Louis, MO 63102.

MARKETS


Order #

Amount

ordered Cost Total

91-0 $31.00

91-1 $32.00

91-2 $31.00

91-3 $31.00

60 $34.50

80 $36.90

2113$27.95

Name:_____________________________________________________

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FFrom Wisconsin

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Provided Below (Allow 10-14 days for delivery)

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Korean FTA key piece in dairy’s Asian questBY MARTIN ROSSFarmWeek

With up to 12 percent ofU.S. milk production nowflowing overseas, NationalMilk Producers Federationtrade analyst Jaime Castenadastresses the sector today is“not your grandfather’s dairy.”

Castenada attributes exportgrowth over the past decadeto bilateral and regional freetrade agreements (FTAs) thathave lifted barriers to U.S.milk powder, butter, cheese,and evolving new ingredientsand products.

Congressional approval ofFTAs with Panama, Colom-bia, and especially South

The U.S. is negotiating to jointhe Trans-Pacific Partnership(TPP), a multilateral trade pactthat would include NewZealand, Chile, and Singapore.

Australia, Vietnam, andMalaysia also seek TPP mem-bership, and with NewZealand dominating globaldairy sales, Castenada sees U.S.participation as vital to com-peting within the region.

He noted China already isconsuming “huge quantities”of whole milk powder. While

Chinese dairy producers havebegun to recover from shakypublic confidence in domesticmilk safety, Castenada sees itbeing “many, many, manyyears before they can supplytheir own demand.”

Meanwhile, he noted whey,once a dairy byproduct fedlargely to livestock, is garner-ing demand among increasing-ly health-conscious Asians.“Whey now has a high level ofprotein — it’s a very sophisti-cated product,” he said.

Korea is crucial to maintainingmomentum, he toldFarmWeek.

Chile and Peru are two ofthe U.S.’ top South Americandairy markets thanks largely toFTAs approved in 2003 and2007, respectively, Castenadasaid. The Central American FreeTrade Agreement, signed in2005, added several small mar-kets that nonetheless “are con-tributing to our overall success.”

“Now, we have Korea,which would give a signifi-cant boost to our exports,”Castenada said. “We’re justwaiting on that. The problemis, the more we wait, themore we not only aren’t

going to increase marketshare — the more we’regoing to lose it to the EU(European Union), NewZealand, and Australia. TheEU already has negotiated anagreement with Korea; theothers are in the process.

“Definitely, Asia is a veryimportant market. It’s a grow-ing market: The Asians werenot really very much into dairyproducts, and this is a changefor them. They started from avery low level of consump-tion, so the growth is expo-nential.”

Korean FTA approval isbut one key piece in efforts tocapture Asian market share:

The Chicago Farmers will discuss ruraldevelopment and hear success stories Nov. 8 inthe Illini Center, 200 S. Wacker, Chicago.

Registration will start at 11:30 a.m. withthe lunch and program starting at noon.The advance registration deadline is Fri-day.

John and Jordan Rocke of RMH Foods,Morton, will discuss their family food pro-cessing company. Donna Lehrer of Esther’s

Place, Big Rock, will discuss her fiber art stu-dio and identity-preserved wool. Jenna Kilgusof Kilgus Farmstead, Fairbury, will talk aboutthe family’s dairy and milk-bottling enter-prise.

Advance registration is $25 for members.Registrations at the door are $35 for membersand $50 for non-members. For more informa-tion or to register, call 312-388-3276 or goonline to {www.chicagofarmers.org}.

Chicago Farmers plan rural development meeting

Anaerobic digester workshopoffered for pork producers

A workshop on anaerobic digesters for pork operations willbe offered Tuesday, Nov. 23, at the University of Illinois Exten-sion Ford-Iroquois office, 912 W. Seminary Ave., Onarga. Theearly registration deadline is Nov. 10.

The workshop will start at 9 a.m. and will conclude at 2 p.m.Topics will include anaerobic digesters and biogas energy

recovery technology concepts, steps to develop a biogas-to-ener-gy project, connecting to the power grid, a pork producer’sanaerobic digester tips, and available technology assistance andresources.

The registration fee is $15 on or before Nov. 10 and$25 after that date. To register online, go to{www.chpcentermw.org/easternillinibiogas2010/index.html}. For more information, call Sam Rinaldi with the U ofI Chicago at 312-996-2554 or e-mail him at [email protected].

Program sponsors include USDA Rural Development, East-ern Illini Electric Cooperative, U.S. Department of Energy Mid-west Clean Energy Application Center, the Association of Illi-nois Electric Cooperatives, the Illinois Pork Producers Associa-tion, and the Illinois Department of Commerce and EconomicOpportunities.

PRODUCTION


Study: Land price declines unlikely in near futureBY DANIEL GRANTFarmWeek

U.S. farmland values haveincreased 58 percent since2000, creating some concernsabout the bubble possiblybursting similar to what hap-pened in recent years to thehousing and stock markets.

Sheila Bair, chairman of theFederal Deposit InsuranceCorp., last month told atten-dees of a risk managementconference in Baltimore it isimportant to monitor farmlandvalues for signs of instability,Reuters news service reported.

“A sharp decline in farm-land prices similar to the early1980s could have a severeadverse impact on the nation’s1,579 farm banks,” Bair said.

Fortunately, the farm econ-omy and factors affectingfarmland values currently aremore supportive than in the1980s, according to a Univer-sity of Illinois study.

In fact, an economist with

The full U of I report onland and cash rent values is

available at the website{www.farmdoc.illinois.edu}.

the American Farm BureauFederation (AFBF) questionedwhether the term “bubble”even applies to the currentstate of the farmland market,despite its high values.

“I think it makes sense todefine a bubble as prices for anasset that are just too high andnot really justified by marketfundamentals,” said JohnAnderson, AFBF economist.“There are some pretty strongfundamentals in the farm realestate market. Commodityprices are historically quite highand interest rates are very low.”

A U of I study came to asimilar conclusion. It notedfarmland prices in the statefrom 1987 to 2004 averaged ayearly increase of 4.8 percentbefore the high-growth periodwhen annual land pricesjumped by an average of 15percent from 2004 to 2008.

“Before a large farmlandprice decline will occur, farm-land returns likely will have to

decrease or interest rates willhave to increase,” said GarySchnitkey, author of the studyand a farm management spe-cialist at the U of I. “Neitherseems likely in the near future.”

Schnitkey noted farmlandprices and cash rents appear to beunder no downward pressure forthe next several years. High com-modity prices in recent monthsactually could push cash rentalrates to higher levels, he said.

However, a major drop infarm income or a rise in interestrates could change the situation.

“In my opinion, the longer-run risk for a large decrease infarmland prices comes morefrom interest rate increasesthan from farmland returndeclines,” Schnitkey said.

It will not take much of anincrease in interest rates to putdownward pressure on landprices, according to the farmmanagement specialist.

For example, a 1 percentincrease in interest rates (from3.33 percent to 4.33 percent)could reduce the capitalizedvalue of farmland (valued at$5,075 per acre in 2010) by$961 per acre to a new capital-ized value of $4,112.

Grain bin safety: age, size factors?BY MARTIN ROSSFarmWeek

The advanced age of many farm grain bins and the largerscale of new grain storage facilities may contribute to the seem-ingly growing frequency of farm and elevator fatalities.

Safety in the modern grain-handling environment thus remainslargely a matter of mind over mass, Grain and Feed Association ofIllinois (GFAI) Executive Director Jeff Adkisson warns.

Last week, Adkisson joined Illinois Farm Bureau, federal andstate officials, and university safety specialists from Illinois, Indi-ana, and Iowa in setting goals and strategies for a new GrainHandling Safety Coalition.

The coalition is looking initially at raising farmer/handlerawareness through public service announcements and mediaoutreach statewide.

The nationwide death toll related to grain engulfment, elec-trocutions, and falls in and around bins continues to climb. A 13-year-old Indiana boy and a 77-year-old Minnesotan were addedto the list over a single late October weekend.

Coalition participants noted many farm bins have reached orsurpassed their reasonable life expectancy. Older bins mayinclude missing outside rungs that increase risks of a fatal fall orrust or leaks that could allow moisture to build inside and causebridging (fragile zones of grain that offer the illusion of solidfooting) or other hazardous grain-quality conditions.

Meanwhile, at roughly a $2-per-bushel average cost to buildnew grain storage, economies of scale have driven increased bincapacity, Adkisson reported.

Amid continued high grain production, new constructionshould continue, he said.

While “it wasn’t that long ago that a half-million-bushel binwas a pretty good bin,” Adkisson cites at least one 1.3-million-bushel Western Illinois bin that spans 130 feet in diameter.

That kind of size can hamper access to trapped workers, andincreased capacity can slow efforts to empty grain from binsbefore workers submerge and “drown.”

Further, Adkisson notes larger bins are equipped with largeraugers to extract grain, potentially raising odds of entanglementor other mechanical hazards.

Whatever the size or age of the bin, he argues the human fac-tor — personal safeguards and sound grain management — iskey to reducing fatalities.

“It all comes back to behavior — somebody making the rightdecision,” Adkisson said. “If you go into flowing grain, does itmatter if you’re engulfed within three seconds or seven seconds?”

FROM THE COUNTIES


three Thursday evenings inNovember. The sessions arefree for 4-H members, FFAmembers, and Black HawkEast students. Cost for oth-ers is $9 or three sessionsfor $20. Call the Henry-Stark Extension office at309-853-1533 or the FarmBureau office at 309-937-2411 for reservations ormore information.

• Darin Newsom, DTNsenior analyst, will be thespeaker at a meeting at 6:15p.m. Thursday, Nov. 18, atthe Moline Viking Club.Following dinner, updatesfrom Mike Schaver, GoldStar FS grain merchandiser,and a WQAD meteorologistwill be given. Cost for theseries is $60 or a single ses-sion for $18. Call the HenryCounty Farm Bureau office

at 309-937-2411 or the RockIsland County Farm Bureauoffice at 309-736-7432 forreservations or more infor-mation.

KENDALL — Theannual meeting will

be at 5:30 p.m. Monday,Nov. 15, at the YorkvilleLegion. A Foundation silentauction will be held. Cost is$15. The Young Leaders arerequesting those who attendto bring non-perishable fooditems to be donated to theKendall County FoodPantry. Call the FarmBureau office at 630-553-7403 by Wednesday, Nov. 10,for reservations or moreinformation.

• The Young Leader andNewark FFA annual farmtoy show will be from 9 a.m.to 2 p.m. Sunday, Nov. 21, at

the Newark High School. Ifyou would like to rent atable or have questions, callthe Farm Bureau office at630-553-7403.

LEE — A harvest cropmarketing workshop

will be at 7 p.m. Tuesday,Nov. 23, at the Rock RiverGolf and Pool, Rock Falls.Steve Johnson, Iowa StateUniversity Extension farmmanagement specialist, willbe the speaker. The pro-gram is sponsored by Lee,Ogle, and Whiteside CountyFarm Bureaus and Sauk Val-ley Bank. Call the FarmBureau office by Monday,Nov. 15, for reservations ormore information.

PEORIA — Theannual meeting will be

at 5 p.m. Saturday, Nov. 13,at the Dunlap High School.

Andy Wiesenhofer, a cow-boy poet, will provide theentertainment. Tickets are$10. Call the Farm Bureauoffice by Wednesday forreservations or more infor-mation.

STARK — Bureau,Henry, and Stark

County Farm Bureaus, andMike Taylor and RonBehrends, Country Financialagents, will sponsor a defen-sive driving course from 10a.m. to 3 p.m. Tuesday andWednesday, Nov. 9-10, at theBlack Hawk College Com-munity Education Center,Kewanee. Both days mustbe attended to receive certi-fication. Cost is $30, whichincludes materials and lunch.Call the Farm Bureau officeat 286-7481 by Friday forreservations or more infor-mation.

VERMILION — Theannual meeting will

be at 5 p.m. (Illinois time)Monday, Nov. 22, at the BeefHouse Banquet Center, Cov-ington, Ind. Tickets are $10for “M” members and $20for “A” members and may bepurchased at the FarmBureau office or from aFarm Bureau director. StateRep. Bill Black (R-Danville)will be the speaker. Deadlinefor purchasing the tickets isThursday, Nov. 18. The Ver-milion County Farm BureauFoundation will hold itssilent auction during regis-tration.

WARREN-HEN-DERSON — The

annual meeting will be at 6p.m. Thursday, Nov. 18, atSt. Pat’s Center, Raritan. Asilent auction will be heldwith proceeds going to thescholarship program and Agin the Classroom. Call theFarm Bureau office at 309-734-9401 or [email protected] reservations or moreinformation.

“From the counties” items aresubmitted by county FarmBureau managers. If you havean event or activity open to allmembers, contact your countyFarm Bureau manager.

CHAMPAIGN — TheChampaign County

Farm Bureau Foundation willsponsor its annual “Harvestour Youth” scholarship gala at4 p.m. Sunday, Nov. 14, atFarm Credit Services,Mahomet. A silent and liveauction will be held, alongwith a meal and games. Tick-ets are $25 and are available atthe Farm Bureau office. Con-tact Debby Rehn, foundationdirector, at 352-5235 for moreinformation. Visit{www.ccfbfoundation.com}for more information on theFoundation.

HENRY — Bureau,Henry, Knox, and

Stark County Farm Bureausand the University of Illi-nois Extension will sponsora fall equine seminar from6:30 to 8:30 p.m. the first

For safe and effi cient heating.MAINTAIN YOUR PROPANE

Learn more by touring a virtual propane farm at

agpropane.com

IFB IN ACTION


Auction CalendarMon., Nov. 1. 10 a.m. 239.61 Ac. WoodfordCo. Jones Family Farm, EL PASO, IL. Terry

Wilkey Auction Service.www.terrywilkey.com

Mon., Nov. 1. 10:30 a.m. 137.54 Ac.Vermilion Co. Womacks Estate, ROYAL, IL.

Gordon Hannagan Auction Co.www.gordyvilleusa.com

Wed., Nov. 3. 960 +/- Ac. Lee Co. SoyCapital Ag Services.

www.soycapitalag.comWed., Nov. 3. 10 a.m. 40 Ac. Moultrie Co. Trust

of John E. Reuss, c/o Scott State BankTrustee, BETHANY, IL. biddersandbuyers.com-keyword-lamendola. autionzip.com-ID #5614Wed., Nov. 3. 960 Ac. Lee Co. Soy Capital

Ag Services. www.soycapitalag.comFri., Nov. 5. 10 a.m. Farmland Auction.

Suzanne Pennington, DELAVAN, IL.Nehmelman Auction Co.

Fri., Nov. 5. 10 a.m. 157.5 Ac. Stark Co.Merwin Burhorn Trust, LAFAYETTE, IL. Van

Adkisson Auction Service, LLC.www.biddersandbuyers.com

Mon., Nov. 8. 10:30 a.m. 80.27 Ac.Champaign Co. Atkins Bros., URBANA, IL.

Gordon Hannagan Auction Co.www.gordyvilleusa.com

Tues., Nov. 9. 7 p.m. 80 Ac. Clay Co. TheFamily of Arthur Phillips, CLAY CITY, IL.Carson Auction, Realty & Appraisal Co.

www.carsonauctionandrealty.comTues., Nov. 9. 223.86 Ac. Carroll Co. Soy

Capital Ag Services.www.soycapitalag.com

Tues., Nov. 9. 10 a.m. 300 Ac. LaSalle Co.John Kuhn Farms, Inc., KERNAN, IL.Bradleys’ and Immke Auction Service.

www.bradleyauctionsinc.comTues. Nov. 9. 6 p.m. 29.86 Ac. near

Mascoutah, IL. The Gustav and Irene LanterTrusts, MASCOUTAH, IL. Mark Krausz

Auction Service.Wed., Nov. 10. 6 p.m. Mega Real EstateAuction. UNION, MO. Adam’s Auction &

Real Estate Services Inc.www.adamsauctions.com

Wed., Nov. 10. 10 a.m. 80 Ac. Warren Co.Margaret Bricker Heirs, BUSHNELL, IL. Van


Wed., Nov. 10. 551 Ac. Ogle Co. RussellJohnson. Soy Capital Ag Services.

www.soycapitalag.comWed., Nov. 10. 551 Ac. Ogle Co. Soy Capital

Ag Services. www.soycapitalag.comThurs., Nov. 11. 6 p.m. 147.8 Ac. Coles Co.Charles Bailey Estate, CHARLESTON, IL.

Stanfield Auction Co.www.stanfieldauction.com

Fri., Nov. 12. 10 a.m. Public Auction. Ronand Rose Ann Moore, SIBLEY, IL. Bill Kruse,

Auctioneer. www.billkruse.netFri., Nov. 12. 9:30 a.m. 80 Ac. LaSalle Co.

Anne M. Brennan, WENONA, IL. LaufAuction Service.

Fri., Nov. 12. 10 a.m. 191.73 Ac. Warrenand Henderson Co. Helen G. (Eileen)Flanagan Trust, MONMOUTH, IL. Van


CCFB Foundation exposes students to urban agBY HALEY LOY-SIERGIEJ

Under the auspices of theCook County Farm Bureau(CCFB) Foundation Agricul-ture Leadership Academy, 29Chicago-area high school stu-dents recently were exposedto urban agriculture.

The students, from theChicago High School for AgSciences and John Marshalland Hubbard high schools,learned of leadership and col-lege opportunities at varioussites in the Chicago area.

farming operations and farmlife and had a wiener andmarshmallow roast, a first formany of the students.

Coordinators for the pro-gram were Haley Loy-Siergiej,director of ag literacy andpublic relations for CCFB, andSarah Song, Facilitating Coor-dination in Agricultural Edu-cation urban program adviser.

Through the leadershipacademy, “Students get toexperience agricultural careersin their own neighborhoodsthat they never even dreamedof,” said Song.

Haley Loy-Siergiej is director ofag literacy and public relations forCook County Farm Bureau. Here-mail address is [email protected].

“The Cook County FarmBureau Foundation is givingstudents a wonderful opportu-nity to not only see agriculturein Cook County, but attendingthis one-of-a-kind event alsoexposes the students to newlife experiences,” said HarryStuenkel, CCFB board memberand a farmer from Matteson.

The students heard pre-

sentations by Illinois StateFFA President John Edgarand Laura West, a Universityof Illinois recruiter.

They learned about home-land security and agriculturesafety at O’Hare InternationalAirport, the distribution of foodat Jewel-Osco distribution centerin Melrose Park, and horticultureand the green industry at Ted’sGreenhouse in Tinley Park.

They concluded their daywith a visit to Stuenkel’s farm,where they learned about

Mike Rauch, a Cook County Farm Bureau (CCFB) board member andcommittee chairman of the county’s ag literacy/public relations team,tells students from three Chicago high schools about corn and soybeanproduction at one of three stations set up on the Harry Stuenkel farm atMatteson. The stop was one of several for the students sponsored re-cently by the CCFB Foundation Agriculture Leadership Academy. (Photoby Haley Loy-Siergiej)

Dairy, technology highlights for ‘adopted’ legislator

McHenry County dairy farmer Lin-nea Kooistra, right, discussed milkproduction with state Rep. DebMell (D-Chicago) during Mell’s re-cent visit. (Photo by ChristinaNour ie , I l l ino i s Farm Bureaunortheast legislative coordinator)

An “adopted” state repre-sentative recently gained a newperspective on how farmerscare for their dairy cattle andhow technology is used incrop production.

State Rep. Deb Mell (D-Chicago) and her staff mem-ber, Melissa Poulos, recentlytoured three McHenry farms.Mell was “adopted” by theMcHenry County FarmBureau earlier this year andhosted several Farm Bureauleaders for a summer tour ofher district.

Dan Volkers, McHenry

County Farm Bureau manager;Bona Heinsohn, Cook CountyFarm Bureau public policydirector; and Christina Nourie,Illinois Farm Bureau northeastlegislative coordinator, accom-panied the Chicago visitors ontheir farm tour.

At the Kooistra Dairy inWoodstock, dairymen Joel andLinnea Kooistra showed thevisitors around their farm,which has 250 milk cows and250 calves.

“Representative Mell gainedan understanding of the hardwork it takes to operate a dairyand how livestock farmers goto great lengths to ensure theiranimals are healthy and receiveproper care,” Nourie said.

The Kooistras also dis-cussed legislative issues facingthe dairy industry and offeredto be an information resourcefor Mell on livestock issues.

Mell and Poulos also visitedMcHenry County FarmBureau President BruceMeier’s grain farm and rode inhis combine. “Like many‘adopted’ legislators, Repre-sentative Mell was surprised bythe amount of technologyused today to grow and har-vest crops,” Nourie said.

The third stop was

Hebron’s Von Bergen CountryMarket, a family-operated veg-etable farm and agri-tourismbusiness. In addition to grow-ing several kinds of vegeta-bles, the farm/market alsooffers a corn maze and pettingzoo. Tracie and Bobette VonBergen provided Mell anoverview of their business.

Mell and the McHenryCounty Farm Bureau are con-sidering future Adopt-a-Legis-lator events, including a possi-ble field trip for students fromher district.

PROFITABILITY


Feeder pig prices reported to USDA*Weight Range Per Head Weighted Ave. Price10 lbs. $29.00-$42.90 $36.0040 lbs. $43.00-$55.40 $51.2550 lbs. n/a n/aReceipts This Week Last Week

26,724 26,663*Eastern Corn Belt prices picked up at seller’s farm

MARKET FACTS

Eastern Corn Belt direct hogs (plant delivered)(Prices $ per hundredweight)

This week Prev. week ChangeCarcass $58.27 $61.07 -2.80Live $43.12 $45.19 -2.07

Export inspections

(Million bushels)Week ending Soybeans Wheat Corn10-21-10 68.3 21.5 19.810-14-10 64.9 21.2 29.7Last year 52.2 14.5 25.7Season total 251.7 451.9 253.8Previous season total 158.7 350.5 274.3USDA projected total 1520 1250 2100Crop marketing year began June 1 for wheat and Sept. 1 for corn and soybeans.

(Thursday’s price)This week Prv. week Change

Steers $99.97 $102.00 -2.03 Heifers $99.79 $102.00 -2.21

USDA five-state area slaughter cattle price

This is a composite price of feeder cattle transactions in 27 states.(Prices $ per hundredweight)

This week Prev. week Change111.07 110.07 1.00

CME feeder cattle index — 600-800 Lbs.

Slaughter Prices - Negotiated, Live, wooled and shorn 120-165 lbs. for 120-149.84 $/cwt., dressed, no sales reported.

Lamb prices

A refresher offered for crop basis fundamentalsBY DARREL GOODAND SCOTT IRWIN

Editors’ note: There have beensome wide swings and unusual sea-sonal patterns in crop basis in Illi-nois in recent years. There alsohave been concerns with lack ofconvergence of cash and futuresprices at futures delivery markets attimes since late 2006. These con-ditions have raised concerns amongIllinois Farm Bureau members, soFarmWeek has decided to re-exam-ine factors that influence the basisas part of its ongoing market cover-age. This installment was producedby Darrel Good and Scott Irwin ofthe University of Illinois’ depart-ment of agricultural and consumereconomics.

In commodity markets,basis is defined as the differ-ence between cash and futuresprices (usually calculated ascash minus futures). The cashprice of grain typically isbelow the futures price in sur-plus (production) areas andabove futures prices in deficitareas, such as export loadingfacilities.

Since more than one futurescontract is traded simultane-ously and cash prices vary bylocation and time of delivery,basis is specified by marketlocation, time of delivery, andfutures contract deliverymonth. Most commonly, basisis quoted as the spot cashprice relative to the nearest-to-maturity futures contract.

Assume that the cash bid

for immediate delivery of cornat Anytown, Ill., elevator was$5.47 on Oct. 20, 2010. TheDecember 2010 futures con-tract settled at $5.74, so the

basis wasminus 27cents or “27under.”

July 2011futures settledat $5.94,$0.20 higherthan Decem-ber futures,

reflecting the market’s pay-ment for storage. Basis onOct. 20 was “47 under” July2011 futures.

Anytown elevator was bid-ding $4.87, or “45 under” theprice of December 2011futures for corn delivered atharvest in 2011.

For each location, the histo-ry of basis behavior results ina notion of a typical orexpected basis at various timesduring the year. Basis isreferred to as “strong”(“weak”) when cash prices arehigher and “weak” when cashprices are lower than expectedrelative to futures.

Of special interest is thebasis at markets deliverable forfutures contracts. Cash andfutures prices are expected to“converge” (basis to approachzero) at futures contract matu-rity since cash and futuresbecome nearly identical com-modities.

Some general observationscan be made about crop basisbehavior in Illinois:

1. New-crop basis tends tovary erratically around a his-torical average during the pre-harvest period. There is nostorage cost incurred for agrowing crop. Basis duringthe growing season is the basisthat is expected to prevail atharvest, often influenced bythe magnitude of harvest basisthe previous year and expecta-tions about the size of theupcoming harvest.

2. The cash price of graintypically gains on futuresprices, or strengthens, as thestorage season progresses.Cash prices tend to go upmore or down less thanfutures prices because it iscostly to store grain and lessexpensive to hold futures con-tracts.

3. Typically, basis strength-ens most rapidly in the imme-diate post harvest period sincethe bulk of storage costs areincurred in providing storagespace.

4. Deferred futures con-tracts are typically higherpriced than nearby contracts,with the “carry” reflecting the

market payment for storage.Occasionally, futures become“inverted,” with deferred con-tracts priced lower than nearbycontracts.

5. Basispatterns areerratic, withconsiderableyear-to-yearvariation intheir magni-tude andbehavior. Inaddition to

the cost of storing grain, basisis influenced by the supply ofand demand for storage.

Large crops may result in aweaker-than-expected basis atharvest and a large strengthen-ing of basis during the storageperiod.

Conversely, a small cropand reduced demand for stor-age may result in a stronger-than-expected basis at harvestand less strengthening duringthe storage period.

The strength of graindemand, the pace of farmerselling, and transportationlogistics also can influencebasis behavior.

Corn basis for the 2010crop has followed the general-

ly expected pattern — verystable during the pre-harvestperiod at typical levels andstrengthening in the immedi-ate post-harvest period.

The soybean basis followeda typical pre-harvest pattern,weakened some at harvestunder the influence of a largecrop, but slow to strengthenfollowing harvest.

Wheat basis behavior hasbeen very erratic in recentyears and that has continuedfor the 2010 crop. Pre-har-vest basis was relatively con-stant at 50 to 55 cents underin Southwest Illinois, muchstronger than the harvestbasis of the previous threeyears.

Basis was even stronger atharvest, with cash pricesequaling futures prices attimes, as a small crop washarvested. Basis becameextremely weak in the post-harvest period with cashprices 90 cents or moreunder December futures onOct. 20.

Periods of non-conver-gence of cash and futuresprices at delivery markets per-sist. Most concern is centeredon the wheat market.

Darrel Good Scott Irwin

BY JOE DILLIERFertilizer prices have been on a one-way ride

higher. The big driver is an explosion in falldemand. The biggest increase in demandappears to be happening right here at home.

Wholesale fertilizer prices domestically fornitrogen and phosphate are up anywhere from40 to 75 percent above summer lows.

Potash is up less, closer to 15 percent, but afterfalling continuously for 18 months right throughspring, and finally bottoming last summer, eventhat’s been a surprisingly strong turnaround.

In many cases, wholesale prices for these

products are running higher than retail-to-the-farm price levels. It’s been a crazy, “one-sur-prise-leads-to-the-next” kind of market for fer-tilizers since July.

What we knew at the end of spring was thatU.S. inventories had been pretty well depletedat the producer-manufacturer, wholesaler, andretailer levels. This was for most all products,and maybe most acutely for phosphate andpotash.

There are no statistics on this (some for theproducer level, but nothing beyond that) but it“felt” pretty dry in early July for inventoriesoverall, and coming off the fertilizer priceimplosion of 2008/09, targeting zero inventorypost-spring season seemed smart.

What we didn’t foresee was how much of an

increase in corn prices was in store for us.And, of course, prices for wheat, cotton, sugar,coffee, and a host of other commodities haverisen, too.

The impact of higher ag commodity priceshas driven up buying interest globally and, ofcourse, world prices for fertilizers. U.S. prices,especially for phosphate and potash, have goneup even more because of the immediacy of ourdemand and the volume of demand we are wit-nessing this fall.

Something to note: The U.S. is generally alarge exporter of phosphates, but this fall we

are importing large quantities from Russia,North Africa, and even China, and we are stillfalling short of meeting demand.

Where are fertilizer prices heading? Theyare tied at the hip right now to grain markets as“demand-pull” will continue to be the driver.

If grain markets fall, fertilizers likely willdecline, too. If grain continues to spiral up, fer-tilizer values will rise. The value of the dollarwill have a direct impact, too.

None of this is very satisfying answer to thequestion of which way are fertilizer pricesheaded, right? One thing is certain: Thevolatility in fertilizer prices will continue.

Joe Dillier is GROWMARK’s director of plantfood. His e-mail address is [email protected].

Demand driving fertilizer prices higher

‘The impact of higher ag commodity prices hasdriven up buying interest globally and, of course,world prices for fertilizers.’

— Joe DillierGROWMARK

PROFITABILITY


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CASH STRATEGISTCorn Strategy

�2010 crop: The uptrendin corn remains intact. How-ever, to signal additional gains,the December contract needsto overcome its $5.88 contracthigh. Even though higherprices are possible, we believethe risk of ownership hasbecome too large to hold cornunpriced. Hedge to arrive(HTA) contractsfor win-ter/spring delivery may be thebest marketing tool, butbecause carry has diminished,check them against cost ofcarrying inventories.

�2011 crop: We continueto think initiating sales of the2011 crop is warranted basedon the income current pricesoffer. Once prices start toimpact demand, the changecould last into the new crop.

�Fundamentals: Thetrade expects USDA to reporta smaller crop in the Nov. 9report, with many expectingthe yield to be dropped anoth-er 1 to 3 bushels. Against this,corn export sales are accumu-lating slower than expected.That’s being countered by talkthat China could be buyer lat-er in the marketing year.Soybean Strategy

�2010 crop: Persistent Chi-nese soybean buying keeps theuptrend intact. If Januaryfutures can hold $12.10, thedoor will remain open for amove up to $12.60 to $12.90.But we believe the large specu-lative long positions have madethe risk too large to justifyholding significant unpricedinventory, if any at all.

�2011 crop: At theseprices, the gross income peracre is too large to justify notmaking a sale. We still believehaving 20 percent priced is agood marketing strategy.

�Fundamentals: Chinesesoybean purchases continue tobe accumulated at an aggressivepace but not one significantlydifferent from last year. Evengiving them an extra 2 millionmetric tons (73.5millionbushels) out of the U.S. becauseof a possible harvest lag inBrazil this year, their purchasesfrom us need only to average .3million metric tons the rest ofthe marketing year. Our crush

margins have gotten so poorthat some smaller plants alreadyare curtailing activity.Wheat Strategy

�2010 crop: Upsidemomentum returned to thewheat market, with the Chica-go December contract pene-trating the 50-day movingaverage and the psychological$7 level. The next resistancecomes at $7.39. Use the cur-rent strength to wrap up salesif you still have inventories.HTA contracts for winterdelivery still appear the bestmarketing tool.

�2011 crop: Use rallies to

$7.80 on Chicago July 2011futures for catch-up sales. If basisis wide compared to this pastsummer, consider HTA contract.

�Fundamentals: Renewedstrength in wheat prices hascome from persistent dry con-ditions in the western GreatPlains and western areas ofAustralia. Portions of the Mid-west soft red winter wheat areaare dry as well, but that is notof as much concern. Weeklyexport sales, 604,500 metrictons (22.2 million bushels),came in at the high end ofexpectations, but the there’sstill concern about the general-ly slower-than-expected pace.

Export activity among thegrains is like a “tale of two

Basis charts

cities.” Soybean sales, to Chinain particular, are accumulatingextremely fast.

But wheat sales havebeen slower than expected,and generally slow cornsales are starting to getattention.

The only feature keepingthe trade from responding tothe disappointing corn andwheat sales is talk they couldimprove later in the marketingyear.

Soybean sales have beengood, but the rapid early accu-mulation increases the riskthey could fall sharply at anytime.

Soybean meal sales are notnearly as robust as they werelast year, either, which couldlead to a slower U.S. crushpace this year.

Cents per bu.

Keep an eye on export sales

PERSPECTIVES


‘Death tax’ real threat for six-generation farm

Life’s two certainties may be death and taxes butwhat about the death tax? The Illinois Farm Bureau iscalling on Illinois farmers to spread the word to tellour story.

On Jan. 1, 2011, the second-highest death tax in theworld returns to plague not only farmers but otherbusiness owners and investors.

I will start “in medias res” (the mid-dle) with the Varner Farms story. Lastsummer a “For Sale” sign appeared onground contagious to 34 acres we ownon a ridge in northern Edgar County.Could we swing it?

Varner Farms began May 6, 1853,when my 3x great grandfather SarsfieldClark received a patent from the gov-ernment for 40 acres. That means weare the only family ever to own thatland. A dozen years later in 1865, then65-year-old Sarsfield bought the afore-

mentioned ridge ground. I long wondered what a guy that old was doing buy-

ing land. Wasn’t it time to sell things off and live? Dadtook over as a fifth generation owner in 1949. He builtup a run-down operation but never added ground.

When my turn came, I thought it was time to growand we have. Currently our share is 20 percent inherit-ed and 80 percent from our ownsweat, including earnings fromhundreds if not thousands ofclasses my wife and I have taughtat Illinois State University as wellas farm income. The labor hasbeen more love than sacrifice.

I am now 65 and Sarsfield isgetting his revenge. I went to thecemetery, rubbed his tombstone,and whispered, “Great, great,great grandpa, I need you to bewith me. Bring me luck andcourage at the auction.” He wasthere and the land is ours.

Well, sort of. The bank has aclaim on the majority. We willmake the final payment as I turn 85. Under current law,we then face a combined federal and state death taxesof 60 percent. No country except Japan does this to itscitizens.

So why on earth are we doing this in our later years?Reason says that we should spend away, have fun, andlive high rather than putting so much into an invest-

ment that will be mostly taken from the fami-ly when we die. Partly, of course, we hope thelaw will change.

Human motivation that defies reason cancome from deep within. My wife is a farm girlfrom the German Far East. In ethnic cleans-ing, the Russians took her family’s farm at theend of the war. This is as close as she cancome to getting it back.

What about me? Recall from the Bible thatthe worthless servant who buried the talentwas cast into the outer darkness where menweep and gnash their teeth. The Lord has giv-en me talent to put together a first-class oper-ation. I fear if the talent is unused, the outerdarkness awaits. Do I really believe that? Whyrisk it?

Death taxes began in 1916 but really cameinto their own at a maximum rate of 77 per-cent under President Franklin Roosevelt inthe 1930s.

By the end of the 1990s, the top rate was 55 per-cent, but a new era was dawning. It was the Internetand high tech. A lot of creative, hard-working peoplehad earned new wealth.

This business-crippling tax, which accounted forless than 1 percent of federal revenue, seemed unjust

and unnecessary. Congress with fairly strong bipartisan

support voted a nine-year phase-outwith the tax expiring Jan. 1, 2010. Thenin a devil’s pact — I believe — unlessCongress reaffirmed the phase-out oragreed upon a compromise, the old 55percent tax would return on Jan. 1,2011.

The pact allows conservatives toclaim liberals want to punish businessand liberals to say conservatives favorthe rich.

What are the arguments for the tax? Ihave seriously heard the argument thatthe privilege of living in America is sogreat that turning more than half of

what you have over to the government should not bethought of as a burden. The Russians took everything,so why complain about a 60 percent death tax?

Next is that few people pay the tax, and they aredead anyway. We put very few people to death, so whyshould anyone complain about capital punishment?

Next, the tax is necessary to prevent excess accumu-

lations of wealth and the attendant power going withthe money. Varner Farms is owned by six family units.We own 0.0034 of a percent of Edgar County farm-land. A dangerous plutocracy of wealth?

Next, even though it represents less than 1 percentof revenue, the government needs the money. Everystudy shows that the disincentives and time and moneyspent on tax avoidance actually cost more than is col-lected.

Imagine the benefits to our society if all thoselawyers, accountants, and financial planners could beput to more constructive tasks.

Most venal, cruel, and false is the zero sum-gameargument. If your business or investment has madeyou well off or rich, someone else must have less.Death tax is thus a just redistribution of often ill-got-ten gain. Investors and entrepreneurs create wealth,not take it from others.

Ironically socialist Sweden, Australia, New Zealand,Canada, and even Russia have abolished death taxes.Most others have rates of 20 percent or less.

In Australia, the death rates of those who wouldhave been liable went down significantly in the monthsbefore the tax expired. Many were able to hang on sotheir families, not the government, got their property.

Will we see the opposite here? Die now and thefarm stays in the family, but survive to January and it ison the block.

Carson Varner is a professor of finance, insurance, and law atIllinois State University, Normal.

CARSONVARNER

Riding agriculture’s econo-my roller coaster can be excit-ing, hopeful, and sometimesscary. Prices are up. Prices are

down and thenback up.

The weatheris completelyout of our con-trol. Too hot.Too cold. Toowet. Too dry.The level ofuncertaintyexceeds mostany other busi-ness.

However, right now the sit-uation looks good. The farmeconomy is on a roll. Net farm

income is projected to surge 24percent this year to $77 billion— the fourth highest onrecord.

The global demand forwhat we produce is strong.The Asian economies aregrowing three times as fast asour own, and they want ourpork, poultry, corn, cattle, andcotton.

The farm and rural econo-my is stronger than much ofthe rest of the country. Thefarm debt-to-asset ratio is anenviable 13 percent.

Recently I attended a lun-cheon and heard Dan Glick-man, former agriculture sec-retary for President Bill Clin-

ton. He reinforced the posi-tion for agriculture.

“We need to double foodproduction in the next 40years, and we need to do itwithout any big increase inacres,” Glickman said.

That’s our challenge.To further increase demand

for our production and acres,the Environmental ProtectionAgency is opening the door toallow 15 percent ethanol inour fuel for cars sold after2006. On top of that, USDAcut this year’s corn yield pro-jection for the second time,which is inflating corn prices.

The rising price of cornand other grains presents a

challenge as well as an oppor-tunity:

• The “food vs. fuel” con-flict may become an issue likeit was in 2008. In fact, youcan expect to hear from live-stock producers and foodprocessors about this addedcost.

• Food price inflation couldbecome a concern.

However, few economistsexpect us to experience the 5percent jump in food priceswe experienced in 2008. Mostare expecting a modest 1 or 2percent increase.

This year’s crop is worthmore than we had expected,and if the weather will coop-

erate, we are in a position toproduce a big crop next year.

And it is going to be wortha lot of money. The farmeconomy and rural economythat go hand in hand are posi-tioned to “let the good timesroll.”

We ride this roller coasteryear after year. We go up. Wego down. Hold on, becausenow we are ready to go up.

John Block of Gilson, a formerU.S. agriculture secretary in theReagan administration, is a seniorpolicy adviser with the Washing-ton, D.C., firm of Olsson, Frank,Weeda, and Terman. His e-mailaddress is [email protected].

JOHNBLOCK

U.S. farmers riding agriculture roller coaster

Under currentlaw, we thenface a com-

bined federal andstate death taxesof 60 percent. Nocountry exceptJapan does this toits cit izens.

Documents

FarmWeek November 1 2010