Farmers Getting Triple the Investment Back with SOURCE

In a time when we hear so much about supply disruptions, one ag company has plenty of their product designed to activate your soil and make nutrients available for corn and soybean plants. Since it is foliar applied, you can still add this to your 2022 plans.

The product is SOURCE™ and it comes from Sound Agriculture.

“It’s really exciting in the times that we’re in with all the challenges going on with the fertilizer market to be able to offer a solution to help get around that and to activate soil, put microbes to work and actually create nutrients right there in that farmer’s field,”  says Jeff Divan, Director of Sales Agronomy for Sound Agriculture.

So, what is really happening when SOURCE™ is applied to a plant?

“It’s waking up and activating bacteria and microbes in the soil that can do things like take in atmospheric nitrogen. They can solubilize phosphorus into available forms for the plants, so really activating those microbes that can do all these great processes for us with a foliar application. So, we then activate and get those nutrients right in season when we need them and we’re able to increase yield and create an efficient environment for that crop to grow in.”

Divan says SOURCE™ offers grower options for application. For corn, they like to see it mixed with a herbicide that can go on V4 to V6 with your herbicide pass.

“Or you could mix it VT to R1 with your fungicide pass,” he said, “so the economics work out great. We can ride along with the trip that’s already happening across the field. Same thing on soybeans. We can go with the herbicide early or a fungicide pass about R3 on soybeans.”

Divan says farmers will like the return-on-investment opportunities, something their customers have experienced for several years.

“The ROI opportunity is very large, especially when you look at the chance to reduce a nitrogen application with SOURCE corn. So we typically target about a 3X ROI on the investment in the product, and if you’re able to reduce some high priced nitrogen, it could be even higher than that. So yeah, at least tripling your investments when we place this product on the best field it can win on.”

For more information on Sound Agriculture and SOURCE™ visit their website. https://www.sound.ag/

Falling Gasoline Demand is Not Good News for Renewable Fuels like Ethanol

The national average gas price has topped five dollars per gallon, an all-time high, but is gas demand dropping because of prices and what might that mean for ethanol demand?

David Widmar is an economist with Agricultural Economic Insights. He says gas usage is slumping when looking over data going back to March.

“We are below pre-pandemic normal. So, when you look at 2015 to 2019 for that as a normal range, we’re running about 91 percent of those levels. And so, we’re going to start to have another conversation here around gasoline usage, gasoline consumption, and all the implications that will have on the broader U.S. economy but also the ag economy.”

The ag economy has some reliance on biofuels, so as gasoline demand drops, it’s not a good sign for renewable fuel blending.

David Widmar, economist with Agricultural Economic Insights.

“We have to start to wonder about that relationship between renewable fuel and energy, and so we have a slowdown in the broader economy through less driving, less economic activity, is going to start to convert into how many gallons of renewable fuel can we physically blend. Ethanol can be a competitive alternative, but we still have this blending problem, and it’s all going to be about the number of gallons of gasoline we consume in the economy and how much can we blend. And in general, a lower amount of gasoline uses less ethanol for a potential blend.”

The longer the high gas prices push demand lower, the more agriculture will be watching what it means for corn demand.

“The longer it persists, the more changes in human behavior we might expect, the more attractive it might be to buy a more fuel-efficient vehicle or, just maybe, even consider changing how your daily routines are, so those behaviors start to become more appealing, more desirable. And then, the last piece to me, I think, we have to struggle with for the next three to six months is how does this ultimately impact corn usage or maybe even soybean oil usage as we start thinking about an economy that might just be using less oil in light of the high prices?”

Widmar says the overall economy, as well as the agricultural economy, are at a tipping point.

“We’ve kind of gotten to this $5 worth, and if we start to see it back away from this, the economic impacts broadly in the U.S. economy but also maybe the impacts in total gasoline consumption and renewable energy consumed from ag products, will have an impact, but it might just be a bit of a passing impact. If these high energy prices stick around and persist, yes, I think we have to start with re-calibrating and re-adjusting our assumptions. But these disruptions can take time to work through, and that’s going to create more uncertainty. I think that’s the key here. It’s going to create more uncertainty for ag markets moving forward.”

Widmar’s website at Agricultural Economic Insights is aei.ag.

House Passes H.R. 7606 Which Includes USDA Special Investigator Bill

U.S. Capitol Building, Washington, D.C.

House Republicans voiced opposition to the Lower Food and Fuel Costs Act which passed on Thursday. Part of the opposition was the creation of a USDA special investigator for meat industry competition. More popular Ag bills were included and the House passed the act to now send it to the Senate.

House Ag Republican leader Glenn ‘GT’ Thompson told the House Rules Committee, USDA doesn’t need a special investigator to police the meat packing industry, blaming Democrats for trying to shift blame for inflation.

“Industry consolidation in the meat processing sector hasn’t changed in decades…supply chain disruptions, historic inflation are happening now. They’ve been made worse by the war in Ukraine—absolutely—but these prices cannot be mitigated by unfunded mandates, duplicative authorities, politicized agencies and big government…and that’s exactly what this special investigator bill provides.”

Thompson says USDA already has a division to enforce the Packers and Stockyards Act, and he argues more bureaucracy and compliance costs will only make inflation worse.

But House Ag Chair David Scott expressed a different view in his panel’s hearings.

“We have farmers right now, and ranchers, that have not made a profit in five-years…and many of the next generation of these families, are refusing to go into this business. And we also found out that 17-thousand ranching businesses are going out of business every year.”

H.R. 7606 passed on a 221-204 vote. The American Soybean Association expressed support since the bill includes biofuels and precision agriculture provisions supported by soybean farmers.

National Corn Growers Association supports two biofuels provisions in the act, saying “The provisions offer a permanent solution for maintaining year-round market access to fuels with a 15% ethanol blend, called E15, and provide additional support for infrastructure for higher biofuels blends.”

NCGA also endorsed the PRECISE Act, which was included in the package.

Growth Energy CEO Emily Skor welcomed the passage saying, “The legislation includes key provisions that would permanently lift barriers to year-round sales of E15.”

Growth also made note of the $200 million authorized for infrastructure funding.

Source: NAFB News

Farm Bureau Seeking Input on Farmer Priorities in Next Farm Bill

Lawmakers have started the process of creating the 2023 Farm Bill and the American Farm Bureau Federation is working on gathering farmers’ priorities. Sam Kieffer, AFBF Vice President of Public Policy, says many lawmakers will be gathering information from farmers this summer.

“Back in April, the first farm bill hearing was held in Michigan, and in about two weeks later this month, the second hearing will be held in Arkansas,” he said. “We expect that throughout the summer and fall, individual members of the agriculture committees in both the House and Senate may host some informal conversations or roundtables in their districts. But from what we’re hearing, we expect farm bill proceedings to really ramp up in the new year.”

Kieffer outlines the early priorities Farm Bureau members want to see in the next farm bill.

“We’re focused on maintaining and strengthening the important risk management tools. We’re also focused on working lands conservation and other mechanisms that provide both environmental benefit and the ability for food production. We’re also going to make sure that rural America has the connectivity and the tools it needs to compete in a digital era. And lastly, but certainly not least, we’re going to be focused on making sure this farm bill is bipartisan.”

Farm Bureau started its internal Farm Bill Working Group process one year ago, and Kieffer encourages members to get involved.

“Right now, our team is generating resources and analyses to be unveiled in the coming weeks and that information will be available to state and county Farm Bureaus, as our state and county Farm Bureaus start holding their policy development discussions throughout the summer and the fall,” Kieffer explained. “And we welcome the thought and the input of members all across the country, on how current farm bill programs can be improved, replaced, or redeveloped.”

Contact your county Farm Bureau to get involved.

Source: AFBF and NAFB News

Southern Indiana Stands are Good but Prepare to Alter Growing Season Plans

The final full week of May allowed for more catch up in corn and soybean planting, but there weren’t as many good windows as the prior week. Southern Indiana DEKALB Asgrow Technical Agronomist Jordan Arndell says 70-80 percent of the seeds are now in the ground.

“We’ve made some really good progress over the last two weeks, and really glad for that,” he told HAT. “I feel like we’re sitting in a pretty good spot right now.”

Stands are looking good, according to Arndell. The late planting has proved beneficial to development of those strong stands.

“We planted into soils that had adequate moisture and had plenty of heat units to come out of the ground, so everything came out of the ground really quickly,” he explained. “Most stands look really good but what I have seen is some crops that have been planted, maybe we pushed it a little bit much and it was a little too we when we planted and then shortly thereafter we had a heavy rain. Now those stands still look good, but I have had calls asking why it leafed out underground or why do I have 29,000 plants instead of 32 to 34 thousand plants in my corn. The simple answer is we planted into a field that was a little wet, we got a heavy, pounding rain on it, and it just crusted over and not all of the plants were able to make it out.”

So far, he has not seen a situation where that required replant, and replanting doesn’t look to be a major issue this season. But disease is something to watch with the later planting. Arndell says be ready to alter your fungicide plans this year. He goes into more detail in the full HAT interview:

Planting is Late, But Nice Northern Indiana Stands Emerging

Even though corn and soybean planting has been behind schedule throughout the spring, emerged crops are showing promise. Jason Harmon is a DeKalb as grow technical agronomist covering northern Indiana who says certain geographies have better stands than others. Soil types are a primary factor.

“We had some progress toward the end of April and then heavy rains came about four days later. There was two inches that washed some things in and if we had much clay content, we had some crusting. But other soils were able to get through that and emergence has been good because of the heat rally that came seven days later.”

Harmon says insects are a concern, and he wants farmers to pay particular attention to bean leaf beetle in soybean fields.

“They were very prominent last year toward that R4, R5 timeframe, to the point where the populations were overwhelming,” he explained. “It was really due to them coming in later than normal and the insecticide didn’t have the residual to take them out. Then they overwintered and with the heat we had toward the beginning of May, they have emerged. I have seen high populations of adult beetles that are hungry for food. So, they will find that field of beans that is emerged.”

Harmon says scout for active feeding, and if you find it follow the Purdue handbook. If there is a higher economic threshold than what is recommended, then take action.

Black cutworm counts are prominent in northern Indiana. Fields that didn’t benefit from fall tillage and burndown are at risk of eggs being laid, and very much so in the  next week.

Click the audio player to hear more from Harmon in the full HAT interview:

New Corn Rootworm Tool to Be Put to the Test This Year

Both this year and next U.S. corn growers will be participating in on-farm testing of a new corn hybrid that will be another major player fighting corn rootworm. Bayer has received EPA approval to launch VT4PRO, although their expected commercial launch is 2024.

“Really what VT4PRO is, it’s our latest innovation corn technology,” says Sean Cohen, U.S. Corn Launch and Tailored Innovation Lead for Bayer. “It’s going to offer the widest spectrum of control for a Bayer product, both above and below ground. It has the innovative RANi Technology also to control corn rootworm. It’s going to unlock grower choice, giving them another choice for corn rootworm in low to moderate pressure areas, and it helps highlight our continued commitment to innovation in bringing solutions to farmers to face what they face on their farm.”

Cohen says this will be a nice complementary solution if your geography includes a wider range of corn rootworm pressure.

“It’s going to be a complimentary product with SmartStax PRO in medium to high pressure, and it represents our commitment to R&D to help growers solve the tough challenges they have on their farm.”

The R&D pipeline pulled VT4PRO from another country.

“How it came about is we really heard a need from growers that said I want a product that has really great above ground and below ground control,” Cohen explained. “So, in this case we were able to look at our global pipeline and we found a product in South America that we were using that would really meet those needs. So, that’s kind of helped us speed up the process.”

Cohen says the tests this year and next are for efficacy, yield, and for germ, to ultimately provide the best guidance for on-farm use. Learn more on Bayer’s new product offering the widest spectrum of insect defense at https://www.bayer.com/en/vt4pro.

Farm Bureau Wants Improvements in Future WOTUS Roundtables

The Environmental Protection Agency held the first of ten stakeholder meetings regarding changes to the Waters of the U.S. Rule, and the nation’s largest farmer organization is calling for more viewpoints in future roundtables.

EPA’s first WOTUS roundtable Monday didn’t address farmers need for clear rules, according to American Farm Bureau Federation’s Courtney Briggs, senior director of government affairs, and she also questioned the panel’s level of experience.

“In theory, these meetings are designed to bring folks with different perspectives together to talk about regionally specific implementation concerns pertaining to WOTUS. And the list of participants for this first roundtable was diverse on paper, but we are very concerned about the lack of diversity of experience on the panel. And few of these participants have actually navigated the regulatory process associated with Clean Water Act compliance.”

After round one, Briggs says Farm Bureau was disappointed in the results.

“We were very disappointed. First, I think the credibility of the roundtable was hurt by the lack of any mainstream agricultural representatives at the meeting. Additionally, there was really no meaningful discussion of the law. So, EPA can only make an informed decision if it seeks out and listens to all viewpoints, and we share the goal of clean water that was expressed by many of the participants, but farmers and ranchers need clear rules and this roundtable failed to address how both of those goals can be achieved.”

She says American Farm Bureau will stay engaged in the process with nine of the ten roundtables still to come. The next is May 23rd. The remaining meetings happen in June and they are all livestreamed. The schedule is here.

HAT Video Series Explores Farm Credit Mid-America and Farmer Relationship

Relationships are what make so many business and client pairings work. It is especially true in farming, and farmers rely on their marketing advisors, and trusted agronomic partners. In a new HAT video on our YouTube channel and Facebook page, our new video specialist Elise Koning has captured the special relationship between a northern Indiana farm family and their ag lender.

“At a time when things were stressful and tight, I woke up one night and couldn’t sleep real well, and I started putting numbers to some things, and I thought I have got to talk to Ashley,” says Indiana farmer Phil Huber from the White and Jasper County area. “And the next day I was able to call her, and she walked me through things, gave me options, and gave me a calming presence at a time when I felt anything but calm.”

She is Ashley Hopp with Farm Credit Mid-America. The company’s relationship with the Huber’s dates back fifty years, and Ashley makes it clear what a business-customer relationship should look like.

“When I first meet a farm family it’s important to me to get to know a little bit about them, their family, and a little bit about their operation, so I often have them show me around their farm before we ever dive into financials.” Hopp adds, “Once I get to know them, we sit down and look at the numbers, we go through balance sheets and taxes and I have them explain to me what their goals are and what they want to see out of the operation in the future.”

The video is one in a series we have this year with Farm Credit Mid-America that takes you to the farm and closer to the relationship that helps the Huber family and farmers like them grow the operation when it makes sense and work through the challenging cycles farmers inevitably face.

Add Interest Rates to List of Uncertainties for Farmers

In farming about the only thing that is certain is you know you will face uncertainties year in and year out. From the weather to your seed costs and fertilizer and other inputs, not to mention equipment and even farm labor, uncertainty is always lurking. There’s been too much of that to handle in the 2020’s.

“Certainly we hope that there’s more certainty down the road, but I think we all understand that there’s challenges ahead,” says Bill York of FarmOp Capital.

When we chatted with him in March at Commodity Classic, York said the current atmosphere also leads to challenges in determining where interest rates are headed.

“The dynamics of the current marketplace, not only from the commodity values, the input costs, the uncertainty in the general market place and the inflation that’s strong and shows no signs of abating, we would expect interest rates will continue to rise and probably accelerate.”

His company, FarmOp Capital says it has never been more important for farmers to manage their risk by planning ahead financially. A fixed rate loan for the farm operations can help.

“That’s one of the value propositions of our loan product,” he said. “Our loans are fixed so we’re locking in our loans now and that loan will stay fixed through the life of the loan. So, if that loan is 17 or 18 months, that rate will stay throughout the loan. But the speed at which rates go up is anybody’s guess although the added uncertainty is likely going to drive rates considerably higher.”

The company is now in its 4th crop year according to York.

“Our loan structure is based around the farmers ability to produce a crop, their crop insurance or risk management strategies, so our collateral is the crop itself. We’ve really focused on farmers that rent a significant amount of their land,” he added. “As we look at that segment, it is the largest growing segment and has been for some time.

Learn more in the full interview with York, the CEO since FarmOp Capital was founded in 2017, and now executive chairman and interim chief revenue officer.

Keir Renick, FarmOp Capital co-founder and former chief financial officer, has been appointed the company’s new chief executive officer.