ADVERTISEMENT
|
|
|
|
Soybeans May
Have Higher Odds Of Price Increases!
The soybean market has outperformed corn during the
recent price collapse. Since grain prices went over the cliff after
Sept. 26, corn prices have fallen by 31%, but soybean prices by a more
modest 22%.
Soybeans just do not have as many negative fundamentals as corn. Several
negative factors are common to both, including the impacts of the
financial crisis and the increasing value of the U.S. dollar. But there
are two important differences as well. First, soybean export purchases
are at a strong pace, and soybeans do not have as much exposure to the
weak energy sector as corn.
In the Nov. 10 updates from USDA, production was lowered by 17 million
bushels and domestic crush was reduced a similar amount reflecting
smaller demand for domestic soybean meal as animal numbers decline.
These small changes left endings stocks for August 2009 unchanged at 205
million bushels which represents about the same stocks-to-use ratio as
the 2007 crop.
Exports are giving soybeans “star power” – at least compared to
corn. USDA estimates that soybean exports for the 2008 crop will be down
by 9% from last year’s high level. Currently export commitments are
actually 15% greater than last year at this time. The rapid pace of
purchases is of course led by our largest buyer, China, which has
purchased 24% more beans than this time last year (China purchased 41%
of all U.S. soybean exports last year). Also, Taiwan and Korea are about
10% ahead of last year’s purchases. Mexico and Japan, our second and
third largest customers, are about 30% behind on purchases. This seems
to indicate that various countries have much different strategies for
when to buy beans this year. If this export pace keeps up, USDA may
increase export volumes in its December updates.
More positive news is that China has a strong cash financial position
with nearly $2 trillion of foreign exchange – that’s like cash
buying power. Cash is king today and our big customer is in good shape.
Also, the Japanese yen has been appreciating relative to the U.S.
dollar, making U.S. soybeans less expensive to Japan.
To continue reading this article on the price outlook for soybeans,
click here: www.agecon.purdue.edu/extension/prices.
By Chris Hurt, Purdue University Extension
economist
|
Take Part In
Corn & Soybean Digest Poll
Please cast your ballot in the latest Corn &
Soybean Digest quick poll. The most recently posted question is:
What factor will most affect your acreage allocation this spring? Cast
your vote on CSD's home page at: cornandsoybeandigest.com/.
(The poll question is just above the commodity prices section of the Web
site.)
|
Expect $10/bu. Breakeven Prices For
Soybeans
U.S. soybean growers will likely find it difficult to
make a profit on next year’s crop, says Chad Hart, Iowa State
University (ISU) Extension economist.
“In 2009, we definitely have the potential for soybean breakeven
prices to average about $10/bu.,” explains Hart. “However, $8.25 is
the price quote around Fort Dodge, IA, that I saw recently for soybeans
to be delivered October 2009. So, it’s quite possible that growers
could lose money on soybeans next year.”
Breakeven prices will largely depend on land rental agreements, which
are highly variable right now, he points out. “In Iowa, the range is
anywhere from about $130 to $400/acre,” says Hart. “We’re still
carrying some old rental agreements at the low end of the scale, and
then we saw some auction rental agreements this summer that went as high
as $400/acre.”
Still, land prices are just one of many rising input costs that could
push soybean growers into the red this year. “Herbicide, seed,
fertilizer – almost any farm input category that you look at now is
significantly higher than last year,” says Hart. “You have to go
back to the early 1970s to see a similar situation where costs are
racing to catch up just as prices are sliding down. That kind of market
environment can put you in a breakeven situation pretty quickly.”
To stay profitable, soybean growers must first calculate their breakeven
costs, emphasizes Hart. “Next, you’ll need to develop a good
marketing plan and stick to it,” he advises. “It should take
advantage of marketing opportunities when they present themselves.”
In the next few months, there may be a battle for acreage between grain
crops that could boost prices higher, predicts Hart. “So, you should
plan to forward contract a portion of your 2009 crop when this occurs to
cover your higher input costs,” he says. “You’ll also need to
manage your risks by taking advantage of insurance and government
programs.”
Finding good prices for inputs and using only what’s necessary to
optimize production is another way to position your farm towards greater
profits, he adds. “For example, this may be a good time to do extra
soil fertility tests to find out exactly how much fertilizer you
absolutely need,” advises Hart.
Extra soil tests this year will pay profitable dividends, agrees
John Sawyer, ISU Extension soil fertility specialist. “Soil testing
has become much more cost effective with the high fertilizer prices
we’re now seeing,” says Sawyer. “In the past, we’ve typically
been recommending a soil test every four years. However, testing every
two years will give you a much better data base on where soil fertility
levels are trending: up, down or holding steady.”
Where phosphorus (P) and potassium (K) soil test levels register in the
high or very high categories (according to ISU Extension publications),
corn and soybean growers can make do this year without applying more, he
says. On the other hand, where P and K levels are low or very low,
farmers can expect yield reductions if they don’t apply nutrients at
recommended rates.
“Farmers have more fertilizer application choices – either none,
full or partial rates – when soils test in the optimum category,”
says Sawyer. “This is the category where we like to see soil tests
maintained over time.”
Yet right now, it may be difficult to take soil samples at the correct
depth to obtain accurate test results, he points out. “In much of
Iowa, soils are still high in moisture,” says Sawyer. “In
high-moisture soils, it can be tough to get a good, representative
sample. Shallow sampling, for example, will result in inflated soil
tests.”
Waiting to test soils until spring is another acceptable option if soils
are too moist now, adds Sawyer. “With an auger system, you can still
take samples in frozen soil, but it may be better to wait until spring
to get more representative samples,” he says. “However, getting a
quick turnaround time on your testing might be an issue if the weather
in early spring is wet, as well.”
For more information on calculating adequate P and K soil nutrient
levels during a time of volatile prices, click on the following PDF file
from ISU: www.agronext.iastate.edu/soilfertility.
To read more on this topic from Purdue University, click here: www.agry.purdue.edu.
By John Pocock
|
 |
ADVERTISEMENT
The health benefits of Vistive low-linolenic soybeans can even affect
your financial health. Earn a 60-cent per bushel premium. Vistive
low-linolenic soybeans. Better oil. Healthier food. Healthier bottom
line.
For more, visit us today at Vistive.com
|
|
Another
Record-Setting Year For Soy Exports
U.S. soybean farmers already have one reason to give
thanks this fall – 2008 exports of U.S. soy have set another all-time
record. This year over 1.5 billion bushels of soy were exported from the
United States, and these exports are valued at more than $12 billion.
Soybean checkoff-funded international marketing efforts helped achieve
these record-setting export numbers.
U.S. soybean farmers shipped out over 1.1 billion bushels of whole
beans. Also, increasing 11% from last year were exports of soybean meal
totaling 346 million bushels. Soybean oil weighed in at nearly 1.1
million metric tons with a whopping increase of 68% from last year’s
numbers.
“Checkoff-funded global demand-building programs have demonstrated
their success with another record-setting year,” says Terry Ecker,
soybean farmer from Elmo, MO, and United Soybean Board (USB)
international marketing chair. “The programs work diligently to make
sure that overseas customers prefer U.S. soy. The numbers prove our
checkoff farmer-leaders understand the importance of marketing U.S.
soybeans.”
China is again the top importer of U.S. soybeans with 490 million
bushels, which go toward human and animal consumption. China also
imported 171,000 metric tons of soy oil from the U.S., which is used as
a cooking oil and other food uses. With 131 million bushels of U.S.
soybeans, Mexico comes in as the second-largest importer, followed
closely by Japan with nearly 100 million bushels. U.S. soybeans also
maintained a strong foothold in the European Union with Germany
importing 45 million bushels, The Netherlands shipping in 43 million
bushels and Spain accepting 19 million bushels.
U.S. soybean farmers support the export of their products through their
soybean checkoff. It’s involved in programs to keep trade channels
open and develop new relationships. Checkoff funding used to support
international marketing is matched with funds from the USDA’s Foreign
Agricultural Service (FAS).
For more information about USB, click here: www.unitedsoybean.org.
Source: United Soybean Board
|
IP Soybean
Market Remains Hot
Demand for identity-preserved (IP) grains has never
been higher, especially for certain food-grade crops.
IP grain buyers are struggling to ensure they're offering an attractive
premium that will entice producers to sign contracts.
“Producer opportunities in the IP grains market have never been
better,” says Greg Lickteig, senior group manager at Scoular Company.
John Motter, a producer in Jenera, OH, has been producing low-linolenic
soybeans for four seasons. This season marks the first in which 100% of
his 400 soybean acres will be planted to the IP soybean. “There's a
demand for low-lin soybeans, and that demand will continue to grow,”
Motter says. And the premium offered is a payoff for his additional
management time. “I have to segregate the soybeans, plant the right
bean in the right field and deliver the bean to the processor. Asking me
to do these things means I have to be rewarded.”
Bob Utter, Louisa Gold Farms, in Columbus Junction, IA, says the added
premium is worth the effort, as long as producers clearly understand
their contract and what is required of them.
To continue reading this article about the outlook for IP grain markets,
click here: cornandsoybeandigest.com/soybeans.
By Mark Moore
|
Registration
Now Open For Commodity Classic 2009
The American Soybean Association (ASA), the National
Corn Growers Association (NCGA) and the National Association of Wheat
Growers (NAWG) will join forces again in 2009 in Grapevine, TX, and
welcome the National Sorghum Producers (NSP). Commodity Classic
participants will have a tremendous opportunity to network with other
growers and industry professionals, plus enjoy a dynamic general
session, a trade show featuring cutting-edge products and services and
technological demonstrations and association policy-making sessions.
The Grapevine Commodity Classic hotels are conveniently located six
minutes from Dallas-Fort Worth International Airport and centrally
located 20 minutes from downtown Dallas or Fort Worth. For more
information on Commodity Classic 2009, or to register, click here: www.commodityclassic.com.
Source: Commodity Classic
|
Ohio Soybean
Plant Found Resistant To Aphids
A soybean plant introduction (PI) has been found to
show resistance to soybean aphid in Ohio, paving the way to control the
insect through new resistant cultivars.
The soybean PI, labeled PI 243540, contains a single dominant gene that
allows the plant to resist soybean aphid feeding and aphid colonization.
These findings have been published in the September-October issue of
Crop Science.
The soybean aphid, first discovered in Ohio in 2001, is a sapsucker
whose voracious appetite can greatly damage untreated soybean fields. It
also has been known to transmit a host of viruses, including soybean
mosaic virus, soybean dwarf virus and alfalfa mosaic virus not only in
soybeans but also in a number of vegetable crops.
“We don't know what it is about PI 243540 and its gene, named Rag2,
but soybean aphids don't like it,” says Rouf Mian, a USDA-ARS
molecular geneticist and adjunct assistant professor with Ohio State
University's Ohio Agricultural Research and Development Center (OARDC).
“We are looking into the mechanism behind the resistance, but we think
it might be a chemical compound being produced by the plant.”
Mian is currently backcrossing PI 243540 with two OARDC-developed
food-grade soybean cultivars: Wyandot and FG5. The work is designed to
transfer the Rag2 gene into susceptible soybean varieties and test their
resistance to the aphid in both the greenhouse and in the field.
Researchers are seeing promising results and hope to have breeding lines
available for release by the end of 2010 if agronomic characteristics,
such as yield and resistance to major diseases, hold up.
“We chose to cross PI 243540 with food-grade soybean cultivars because
of the importance of food-grade soybeans in the industry, especially
when it comes to seed cosmetics and the potential economic impacts,”
says Mian. “This also opens up alternatives for producers looking to
grow organic soybean varieties.”
In addition to PI 243540, Mian has identified other soybean plant
introductions that show resistance to soybean aphid, albeit on a
moderate level. Mian hopes to use those findings to develop
partial-resistant soybean cultivars, whereby multiple genes rather than
a single, dominant gene define resistance.
“The good thing about single genes is that they are easy to transfer
into other plant cultivars,” says Mian. “The drawback is that their
resistance doesn't last long, maybe 10 years. Partial-resistant
varieties hold up much longer because it's more difficult to overcome
multiple resistant genes rather than just one.”
OARDC's work is the latest in a series of national research efforts to
more effectively manage soybean aphid. University of Illinois, Michigan
State University and Kansas State University have all identified their
own soybean plant lines that show resistance to soybean aphid.
To read more about the soybean aphid study, click here: crop.scijournals.org.
Source: Ohio State University
|
What's My Risk
For 2009?
Commodity markets over the past several months cause
me to be anxious. Undreamed of price levels, non-ag market makers and
systemic financial stress are not typically part of my market planning.
Additionally, commodity prices are falling while many expenses continue
to rise. The futures markets suggest tighter profit margins are
possible. At current prices and projected costs, it is difficult to
project a crop profit in 2009.
Adequate working capital is significant because the amount of capital
needed to farm has nearly tripled in two years. Meanwhile suppliers are
convincing producers to prepay for their supplies. Prepaying for inputs
at record high prices – months in advance – is a tough decision to
make. Farmers may now want to consider the liquidity and solvency of
input suppliers.
How can farmers manage in today's risk environment?
- When prepaying inputs, spread risk by buying inputs in increments
so, if prices decline, you're not wrong on the whole amount
purchased.
- Know who you are doing business with.
- Utilize revenue-based crop insurance.
- Build working capital to meet current and future obligations and to
take advantage of opportunities as they arise.
- Develop and follow a sound marketing plan.
- Make sure your lender understands your marketing plan. If you are a
do-it-yourself marketer, make sure you have an adequate marketing line
of credit to cover margin calls when needed.
- Invest time educating yourself and your employees to meet new
production and management challenges.
- Communicate regularly with your family, employees, landlords, banker
and others important to the success of your farming operation.
- When practical, make grain sales in increments. Take advantage of
profitable opportunities when they appear.
Many ag specialists believe combining a revenue-based crop insurance
policy with a preharvest marketing plan is still the best deal in town
for managing risk. (Bill Craig, agricultural business management
educator with University of Minnesota Extension, provided information
for this article.)
By John Berry, Penn State Cooperative Extension,
Lehigh County
|
Bidding Out The
Profit
Scott Irwin's colleagues cringed when the University
of Illinois ag economist stated, “The real winners with today's higher
prices are landowners. If history is any guide, we will see every ounce
of the operating margin bid into land and cash rents.” Or, said
another way, there isn't a farm program or price level that farmers
won't bid the profit out of.
It's not the sort of thing farmers like to hear. No matter how true it
might be.
But while his colleagues cringed, Irwin stands by the statement.
“Profits will ultimately dip back to historical levels of roughly
$50-60/acre as land and production costs rise to keep pace with new-era
prices,” he says. “Human psychology never changes.”
Easy money never lasts, according to Wells Fargo Ag Economist Michael
Swanson. “But there's always money to be made,” he says. “Last
year and 2008 were the years to make the easy profits. Next year and
beyond represent a return to the commodity world's typical approach.
You'll need to grind out a profit through superior management and
discipline.”
To continue reading this article on cash rents and profits, click here:
cornandsoybeandigest.com/ag-issues/bidding_profit_irwin_1108/.
By John Russnogle
|
Fall Nematode Sampling -- Especially For
Soybean Cyst Nematode
Fall can be a very good time to sample for soybean
cyst nematode (SCN), because the cyst protects the eggs and fairly
accurate counts can be obtained even after soil temperatures drop.
Soybean cyst nematode continues to be the most serious disease of
soybean in Missouri as well as much of the rest of the U.S.
Although Missouri soybean producers can help protect their crop against
SCN by planting soybean varieties that have some resistance to SCN and
by rotating soybean with corn, grain sorghum, wheat and other non-host
crops, the first step toward protecting against SCN is to test the soil
for SCN. Although soil samples for SCN may be collected at any time, a
convenient time to sample is immediately after soybean harvest. SCN
numbers tend to be highest when the plants are almost mature to shortly
after harvest.
Sampling after harvest is easier to do, because the plants have been
removed, making it easier to move through the field. And sampling in the
fall allows sufficient time for the University of Missouri plant
nematology laboratory to process samples and provide results so that
information can be used in making variety selections for the coming
season, planning field rotations or deciding which crop to plant in
which field.
To continue reading this article about SCN management in Missouri, click
on the following PDF file Web link: ppp.missouri.edu/newsletters.
For information about SCN management in Iowa, click here: www.extension.iastate.edu.
By Laura Sweets, University of
Missouri
|
Nebraska Soybean Day And Machinery Expo
Convenes Dec. 12
The 2008 Nebraska Soybean Day and Machinery Expo will
assist soybean producers in planning for next year's growing season. The
expo, which begins at 8:30 a.m. and concludes at 2:30 p.m. on Dec. 12,
will be in the pavilion at the Saunders County Fairgrounds in Wahoo,
according to Keith Glewen, University of Nebraska-Lincoln (UNL)
Extension educator. Presenters include UNL researchers and specialists,
Nebraska Soybean Board representatives, soybean growers and private
industry representatives.
“Grain Marketing Is Simple” will be presented by Ed Usset, a grain
marketing specialist at the University of Minnesota. Usset will discuss
how to simplify pre- and postharvest marketing.
Other topics on the program include: Soybean Aphids! When Did It Pay To
Spray?; On-Farm Soybean Production Research Results From Area Growers;
Early Soybean Planting Dates –
An Economic Analysis; Making Dollars and Decisions With The New Farm
Bill; Nebraska Soybean Checkoff Update; and Foliar Soybean Disease
Management! Do You Need It?
Registration is available the day of the expo at the door. For more
information about the program or exhibitor information, call
800-529-8030 or e-mail kglewen1@unl.edu.
This program is sponsored by UNL Extension in the university's Institute
of Agriculture and Natural Resources, the Nebraska Soybean Board,
Saunders County Soybean Growers Organization and private industry. There
is no registration fee.
Source: University of Nebraska-Lincoln
Extension
|
Diesel Fuel Possible From Patagonia
Fungus
A team led by a Montana State University (MSU)
professor has found a fungus that produces a new type of diesel fuel,
which they say holds great promise. The discovery may offer an
alternative to fossil fuels, says Gary Strobel, MSU professor of plant
sciences and plant pathology, who travels the world looking for exotic
plants that may contain beneficial microbes.
Strobel found the diesel-producing fungus in a Patagonia rainforest in
2002, when he collected a variety of specimens, including the branches
from an ancient family of trees known as “ulmo.” When he and his
collaborators examined the branches, they found fungus growing inside.
They continued to investigate and discovered that the fungus, called
Gliocladium roseum, was producing gases. Further testing showed that the
fungus – under limited oxygen – was producing a number of compounds
normally associated with diesel fuel, which is obtained from crude oil.
“These are the first organisms that have been found that make many of
the ingredients of diesel,” says Strobel. "This is a major
discovery.”
For more information about the diesel-producing fungus, click here: www.montana.edu/cpa/news/nwprint.php?article=6417
Source: Montana State University News
Service
|
AMA
Supports Trans Fat Ban
In an effort to help Americans maintain good health
and lower the risk of the nation's No. 1 killer – heart disease –
the American Medical Association (AMA) last week adopted policy that
supports legislation to ban the use of artificial trans fats in
restaurants and bakeries nationwide.
“Trans fats have been proven to raise LDL, the bad cholesterol, while
lowering HDL, the good cholesterol, which significantly increases the
risk for heart disease,” says Mary Anne McCaffree, AMA board member.
“By supporting a ban on the use of artificial trans fats in
restaurants and bakeries, we can help improve the quality of the food
Americans eat and may ultimately save lives.”
Major cities like Chicago and New York have already banned the use of
trans fats in restaurants and bakeries. California signed a law banning
trans fats earlier this year. Previous AMA policy on trans fats urged a
reduction in its use and encouraged replacing trans fats with healthier
fats and oils.
Trans fat comes from adding hydrogen to vegetable oil through a process
called hydrogenation. Hydrogenation gives foods a longer shelf life.
Commercial baked goods, like crackers, cookies and cakes, along with
many fried foods, like french fries and doughnuts, contain trans fats.
For more information on how soy food products help consumers to avoid
unhealthy oils and fats, click here: www.unitedsoybean.org.
Source: American Medical Association
|
Turkey For The Holidays Web
Site
Ready to “talk turkey?” Or do you have questions
about how to select, prepare, serve and store the popular holiday main
course? If so, University of Illinois Extension is ready to help. Turkey
for the Holidays (www.urbanext.uiuc.edu/turkey/)
features a broad array of information and helpful tips to make the
holiday meal a success.
The Web site, developed by Drusilla Banks, a U of I Extension food
science and nutrition specialist, includes cooking techniques,
selection, carving, side dishes, turkey facts, turkey safety, turkey
farms, nutrition information and how to deal with leftovers.
One important feature for the harried cook is “Turkey FAQs,” which
answers to many questions that can bedevil those caught in the midst of
cooking a large meal.
Source: University of Illinois
Extension
|
A Note From The Soybean E-Digest
Editor: Happy Thanksgiving!
A week from today is Thanksgiving, which ranks pretty
close to Christmas as my favorite holiday. Unlike Christmas, however,
Thanksgiving stands out as one of the least commercialized big holidays
around.
It’s the simplicity of the holiday that I find appealing: just plain
counting your blessings and giving thanks for the good things you’ve
got. Anyone can do it, and you can do any time or day of the year.
Of course, Thanksgiving is always better if you share it with somebody,
and people are generally more thankful if they realize there are others
less fortunate than themselves that they can help out.
Soybean growers have had a lot to be thankful for over the last couple
years. This year, the challenges are considerable, but there are more
resources than ever to help you get through the tough times.
In anticipation of the upcoming struggle, a couple new Web sites are now
available to assist you. The first is an online USDA risk management
tool, which is designed to help farmers focus on how to protect against
downside risks as well as take advantage of upside opportunities in the
market. It’s available at:
farm-risk-plans.usda.gov.
The second is a University of Illinois “Tough Times” Web site that
is geared to help consumers cope with the economic downturn. You can
find it at: ToughTimes.illinois.edu.
If you come across other avenues where struggling farmers can find help
in these tough economic times, or if you have specific questions on how
to make a profit in the current down market, I’d like to hear from
you.
When writing, please let me know your name, where you live, farm or
work, what your comment is and whether or not I have permission to use
your comment in a future Soybean E-Digest newsletter. You can
contact me (John Pocock) at: john.pocock@penton.com.
As always, you’re welcome to write to me if you have concerns or
questions about this issue. I look forward to hearing from you. Thanks
for your readership, enjoy the holiday – and farm on!
|
|
|
You are subscribed to this newsletter as #email#
To unsubscribe from this newsletter go to: Unsubscribe
To subscribe to this newsletter, go to: Subscribe
More About this Newsletter
To get this newsletter in a different format (Text or HTML),
or to change your e-mail address, please visit your profile
page to change your delivery preferences.
For questions concerning delivery of this newsletter, please contact our
Customer Service Department at:
Customer Service Department
Corn & Soybean Digest
A Penton Media publication
US Toll Free: 866-505-7173
International: 847-763-9504
Email:cornandsoybeandigest@pbinews.com
Penton Media | 249 W. 17th Street | New York, NY 10011
Copyright 2007, Penton Media. All rights reserved. This article is
protected by United States copyright and other intellectual property
laws and may not be reproduced, rewritten, distributed, re-disseminated,
transmitted,
displayed, published or broadcast, directly or indirectly, in any medium
without the prior written permission of Penton Media.
|
|
Subscribe
