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Articles from 2020 In February


This Week in Agribusiness, Feb. 29, 2020

Part 1

Max joins us from Commodity Classic in San Antonio, where he spoke with Kevin Ross, president, National Corn Growers Association, about his thoughts on the corn industry going forward.

Max also spoke with Bill Gordon, president, American Soybean Association, about the organization's outlook for 2020 and the soybean industry.

Part 2

Mike Pearson is also in San Antonio and spoke with Ted Seifred, Zaner Ag Hedge, about the impact of coronavirus, corn and soybean market outlook, planting intentions and the wheat market.

Chad Colby visits with Robert Saik, Dot Technology Corporation, about autonomous farm equipment and farmer reactions.

Part 3

Max spoke with Matt Lohr, chief, Natural Resources Conservation Service, about his connection with farmers and what the NRCS does for farmers.

Part 4

In the Plan Smart, Grow Smart series, Max visited with Corey Atley, Ohio farmer, and BASF innovation specialist Matt Cook, about fungicide trials and his farm operation.

Greg Soulje is in studio for the weather forecast.

Part 5

Greg Soulje is back with an extended weather outlook.

Part 6

There's a Farmall M in Max's Tractor Shed this week.

The FFA Chapter Tribute goes to Verona FFA in Missouri.

Time and financial limits for campaigns? That's what's on Orion's mind in Samuelson Sez.

Part 7

Max spoke with Bob Bowman, Commodity Classic co-chair, about the trade show and education at the show.

CME Group raising hog futures trading limit

Credit: FeelPic/iStock/Thinkstock Stock market
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To ease volatility that has stemmed from the spread of African swine fever and ongoing trade negotiations with China, CME Group announced in a Feb. 27 filing that it is increasing the daily trading limits for its lean hog futures to 3.75 cents/lb. from the previous 3 cents/lb. From there, the limit will expand temporarily to 5.5 cents/lb. if any of the front eight contract months settle at the initial limit.

The limits increase will be implemented April 13 but will be reset annually on the first trading day in September, the firm said.

Currently, limits temporarily expand to 4.5 cents if any of the front three contract months settle at the initial limit. However, CME Group said African swine fever and the ongoing U.S.-China trade war have produced “very high levels of volatility” in the lean hog market. As a result, CME Group reported that the contract settled at the daily price limit ($3.00 or $4.50/cwt.) 31 times —14% of trading days — in 2019. Of those days, there were three instances where the contract settled at the expanded limit of $4.50/cwt.

“This volatility trend has continued into 2020, with four days of limit settlement as of Feb. 7, 2020,” the firm said. “Limit settlements can inhibit price discovery and can hinder market participants when entering, exiting and/or rolling positions.”

CME Group referenced a 2014 decision by the Chicago Board of Trade (CBOT) in which it implemented a variable price limit mechanism in its grain and oilseed markets to avoid frequency in limit settlements. “Since its implementation in the CBOT grain and oilseed markets, there has been a significant reduction of the number of days those markets have settled at the limit price,” the firm noted.

Archived PorkBridge, SowBridge programs now available

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Since the initial program began in 2005, PorkBridge and companion program SowBridge have provided relevant, timely and accurate information to those respective segments of the swine industry, according to an announcement from the Iowa Pork Industry Center (IPIC).

PorkBridge is designed for those who own, manage or work in grow/finish operations, and SowBridge (which began in 2007) is directed toward those who work with sows, boars and piglets and with genetic and reproductive issues. Both programs are sponsored, planned and organized by representatives from a group of 11 universities — including Iowa State University — from the nation’s major swine producing states, IPIC said.

IPIC said both programs are offered on an annual basis and deliver content electronically to subscribers. Live teleconference sessions — 12 monthly sessions for SowBridge and six sessions on an every-other-month basis for PorkBridge — supply direct access to recognized industry experts who speak on defined topics.

To encourage participation in these programs through a look at past topics and speakers, the committee is offering limited access to informational materials from selected years, IPIC said, noting that the information was correct and appropriate as of the presentation date, and no guarantee is made of the accuracy of any of the information since that date.

To see these past PorkBridge presentations and learn about subscribing for the 2020-21 program year, visit www.ipic.iastate.edu/porkbridge.html. The past SowBridge presentations and subscription information are available at www.ipic.iastate.edu/sowbridge.html.

IPIC said registration for either program is accepted at any time.

Manage broiler litter stacks to reduce natural hormones

Image Source Pink/Image Source/Thinkstock aerial view of poultry farm barns

In the broiler chicken industry, an estimated 13.2 million tons of broiler litter is generated annually, and this byproduct must be properly managed, utilized and disposed of, researchers from the University of Georgia wrote in a recent issue of the journal Poultry Science.

While land application of broiler litter provides plant nutrients, it also has potential as an environmental contaminant because it contains the naturally excreted sex hormones testosterone, estrone and 17 beta-estradiol, according to University of Georgia researchers Kate Cassity-Duffey, Miguel Cabrera, Mussie Habteselassie, Sayed Hassan, John Rema and Brian Fairchild.

They noted that the concentrations of these sex hormones in broiler litter can be affected by the number of flocks, age, sex, type and housing/storage conditions that, in turn, drive hormone degradation rates, which are driven primarily by mineralization, with some dissipation.

Cassity-Duffey et al. said when broiler house cleanout does not coincide with appropriate land application times, excess litter must be stored, and stacking is the most common storage practice to manage poultry litter prior to land application.

Deep stacking is done under permanent storage structures, the researchers said, noting that stacks are recommended to be less then 2 m high to avoid fires. Under real-world conditions, stacks vary in litter composition, temperature, water content and height and, therefore, vary in potential hormone-mineralizing conditions.

Cassity-Duffey et al. conducted a study to better understand the dynamics of sex hormones in broiler litter after removal from the house and placed in stacks.

The researchers monitored stack temperatures and hormone concentrations at 15, 45, 75 and 105 cm (measured from the stack bottom) in six different on-farm stack houses for either four or eight weeks.

Significant differences in temperature were determined by height and by stack, Cassity-Duffey et al. said, noting that stack temperatures during the first four weeks ranged from 41.5°C to 54.5°C, and all stacks reached a maximum temperature by day 7. The highest temperatures were observed at the 45 cm or 75 cm height. Average stack temperatures correlated with the ambient temperature, the researchers said.

Hormone concentrations did not vary with height within each house, Cassity-Duffey et al. reported. In five of the six stack houses, the concentrations of 17 beta-estradiol and/or testosterone significantly decreased after stacking for four or eight weeks (35-64%), with only one house showing a significant decrease in estrone concentration (72% in four weeks).

The percent change of estrone and 17 beta-estradiol mineralization during the first four weeks was negatively correlated with the day 7 pile temperature, Cassity-Duffey et al. reported, noting that this indicates that the high temperatures observed during stacking may inhibit estrogen mineralization.

Cassity-Duffey et al. concluded that hormone degradation decreased with high temperatures. Therefore, they said stack management practices that favor at least a period of low temperatures may help promote mineralization of these hormones and reduce any potential for introduction into the surrounding environment.

Tyson hires digital technology service provider

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Tyson Foods Inc. recently announced that it has hired an outside service provider to accelerate the transformation of the company’s digital technology capabilities and reduce costs.

“The speed and scale of new technology presents a huge opportunity for us,” Tyson chief technology officer Scott Spradley said. “While we’ve made significant progress over the past two years enhancing our computing systems and digital capabilities, we need to drive more rapid improvements in our digital transformation to remain competitive.”

The company’s information technology (IT) leaders went through a year-long review that led to a decision -- supported by the company’s senior leadership -- that involves entering into a strategic relationship with a global digital services provider with offices across the U.S. and other parts of the world. This means Tyson will shift some of its current IT roles and responsibilities to the outside service provider.

“While it’s the right thing to do for the business, it’s a very difficult decision,” Spradley said. “That’s because it will result in organization changes in our information technology team, including some job loss.”

The transition to the service provider will take place over the next several months and will result in the displacement of about 330 IT team members, mostly in Springdale, Ark., and Chicago, Ill. This represents a large number of the positions the company previously disclosed it was eliminating through a restructuring program started late last year.

Some of the affected IT team members will be offered a position with the service provider. Others will be offered a severance and benefits package. Tyson is also bringing in a career transition services firm to help those being displaced find new jobs.

Dairy & specialty livestock markets, 2/28/2020

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New USDA Rural Development undersecretary named

iStock Thinkstock front of USDA building
The USDA has set aside $16 million in grants for pest detection and mitigation.

U.S. Agriculture Secretary Sonny Perdue announced that Bette Brand will serve as deputy undersecretary of the U.S. Department of Agriculture’s Rural Development (RD) following the retirement of Donald “DJ” LaVoy.

Brand most recently served as administrator of RD’s Rural Business Service agency. She came to USDA after 35 years with Farm Credit of the Virginias, where she served as chief advocate for the agriculture industry and rural businesses, supporting producers at the state and national levels and educating policy-makers and consumers on agriculture. Prior to that role, Brand served as chief sales officer, overseeing the business development of a $1.6 billion credit portfolio, managing a team of commercial agriculture and agribusiness lenders and supervising marketing and branding. She has wide-ranging experience promoting rural communities, having served on the Virginia Agribusiness Council, the Virginia Horse Council, the Virginia Cooperative Council and the Virginia Foundation for Agriculture in the Classroom.

Since her arrival to USDA in January 2018, Brand has prioritized increasing rural America’s access to capital, investing in innovative technology and helping businesses create jobs. She said she especially enjoys traveling across the country in her official capacity as administrator to better understand the specific needs of America’s diverse rural communities and to discuss with local leaders the best way to serve them. By focusing on infrastructure, partnerships and innovation, Brand said she looks forward to continuing her work to help revitalize America’s rural economy. Brand has a degree in animal science and a master's of business administration from Virginia Tech. She and her husband, David, live in Roanoke, Va., and have three grown sons.

“DJ LaVoy is a true public servant and brought decades of leadership in economic development and affordable housing. We are appreciative of his service here at USDA and wish him nothing but the best as he heads into retirement,” Perdue said. “The mission of Rural Development to improve the economy and quality of life in rural America will continue to advance with Bette at the helm. Like President [Donald] Trump, Bette’s drive and tenacity to fight for those living in rural areas and to increase rural prosperity is admirable. She is perfectly suited for this role.”

LaVoy has more than 22 years of experience working as a leader in affordable housing and economic development at the U.S. Department of Housing & Urban Development. He created the role of and served as deputy assistant secretary for the Real Estate Assessment Center, where he was responsible for driving agency innovation. LaVoy led the replacement of numerous, outdated information technology data collection systems with data streaming and web portals architecture in a cloud environment. He also partnered with members of the federal family and all 58 State Housing Finance Agencies to lead the way in establishing a universal inspection standard for federally subsidized properties. LaVoy started his career with the U.S. Marine Corps and is a marine aviator and combat veteran. He earned his bachelor degree from Old Dominion University and his master of industrial engineering from the U.S. Army War College.

Higher biofuel blending program gets $100m boost

Higher biofuel blending program gets $100m boost

U.S. Agriculture Secretary Sonny Perdue announced Friday while speaking at Commodity Classic that the U.S. Department of Agriculture is providing $100 million in competitive grants for infrastructure projects to facilitate increased sales of higher biofuel blends through the Higher Blends Infrastructure Incentive Program (HBIIP).

Through this program, transportation fueling and biodiesel distribution facilities will be able to apply for grants to help install, retrofit and/or upgrade fuel storage, dispenser pumps, related equipment and infrastructure to be able to sell ethanol and biodiesel. The department plans to publish application deadlines and other program information in the Federal Register this spring.

The drastic increase in the number of refinery exemptions from the Renewable Fuel Standard (RFS) granted by the Environmental Protection Agency over the last three years destroyed roughly 4 billion gal. of biofuel demand and caused a major uproar in farm country. On Oct. 4, 2019, EPA announced a number of steps the Trump Administration would take to repair the damage, including an infrastructure program by USDA.

USDA is exploring options to expand domestic ethanol and biodiesel availability and announced a request for information on opportunities to consider infrastructure projects to facilitate increased sales of higher biofuel blends (E15/B20 or higher).

This effort will build on biofuel infrastructure investments and experience gained through the Biofuels Infrastructure Partnership (BIP). USDA administered BIP from 2016 to 2019 through state and private partners to expand the availability of E15 and E85 infrastructure to make higher ethanol blends available at retail gas stations around the country.

“Both of these actions underscore USDA is putting our money where our mouth is when it comes to increased biofuels usage. Expanding nationwide infrastructure that offers biofuels and increasing the number of biofuel capable vehicles in our fleet will increase the use of environmentally friendly fuel with decreased emissions, driving demand for our farmers and improving the air we breathe,” Perdue said.

Growth Energy chief executive officer Emily Skor said the group is grateful to Perdue for this commitment to expanding infrastructure and access to higher blends of biofuels.

“Through the original Biofuels Infrastructure Partnership grants and private fundraising, Growth Energy and Prime the Pump have worked with 14 of the largest retailers to install more than 2,000 retail locations across the nation, expanding consumer access to Unleaded 88, a fuel blended with 15% ethanol. Secretary Perdue’s announcement today helps propel higher biofuel blends into the next decade, and Prime the Pump’s retail partners are ready to embrace this new wave of growth,” Skor said.

“We are excited to see Secretary Perdue and USDA move expeditiously to implement a key part of President [Donald] Trump’s plan to repair the damage caused by RFS refinery exemptions that was announced last October,” Iowa Renewable Fuels Assn. executive director Monte Shaw said. “This program is going to assist substantially in helping fuel stations and terminals across the country add the necessary infrastructure of offer higher blends of ethanol and biodiesel. We look forward to working alongside the Administration to ensure the successful implementation of the program.”

Shaw also said as the biofuel industry plans to work with USDA on infrastructure, it also stands ready to work with EPA to begin building on the President’s earlier decision to allow year-round sales of E15 by initiating a rule-making process to streamline labeling and remove other barriers to the sale of E15. “This action should move in concert with the infrastructure program to maximize the positive impact of President Trump’s commitments,” he said.

USDA, DEA reach deal on hemp lab requirements

Hemp Field 2019

The U.S. Department of Agriculture (USDA) and Drug Enforcement Administration (DEA) reached an agreement that drops the provision in USDA’s Interim Hemp Rule that required hemp growers to test the tetrahydrocannabinol (THC) levels of their crops at a DEA-certified laboratory. The requirement was one of a few major points of contention for the hemp industry in the Interim Hemp Rule because there were fewer than 50 such laboratories in the U.S., and growers were required to sample and harvest their crops in a tight, 15-day window. 

Under the new guidance, USDA will delay enforcement of the requirement for labs to be registered by DEA and the requirement that producers use a DEA-registered reverse distributor or law enforcement to dispose of non-compliant plants under certain circumstances. Enforcement will be delayed starting this crop year and until Oct. 31, 2021, or until the final rule is published, whichever comes first.

“Because currently there isn’t sufficient capacity in the United States for the testing and disposal of non-compliant hemp plants, USDA has worked hard to enable flexibility in the requirements in the interim final rule for those issues,” USDA undersecretary for marketing and regulatory programs Greg Ibach said.

Laboratory testing

Laboratory testing for the purposes of determining compliance under the U.S. Domestic Hemp Production Program can be conducted by labs that are not yet registered with DEA. The laboratories must still meet all the other requirements in the interim final rule.

Without the requirement to have the hemp tested at a DEA-certified laboratory, growers will now be able to use state and local labs, as they have done for previous crop years. States that already had their hemp plans approved by USDA often require that the labs be approved by a state agricultural agency, so some hurdles may still remain for laboratories that wish to begin testing hemp crops for THC content, but this is overall a boost for the hemp industry going into the 2020 growing season.

All laboratories engaged in the testing of hemp through this interim period will be subject to the same compliance requirements of the interim final rule. Specifically, labs must adhere to the standards of performance as outlined within the rule, including the requirement to test for total THC employing post-decarboxylation or other similarly reliable methods. All labs will have to make arrangements to be compliant with registration requirements before this period of delayed enforcement expires. DEA will evaluate all applications using the criteria required by the Controlled Substances Act (21 U.S.C. 823(f)).

Disposal

Based on feedback from states and tribes, and in consultation with DEA, USDA has identified additional options for the disposal of “hot” hemp plants. Some of these new options include, but are not limited to, plowing under non-compliant plants or composting into “green manure” for use on the same land. The new methods are intended to allow producers to apply common on-farm practices for the destruction of non-compliant plants.

Hemp that tests greater than 0.3% THC on a dry weight basis must be disposed of on site according to the disposal methods approved by USDA. The state, tribe or state department of agriculture will be responsible for establishing protocols and procedures to ensure that non-compliant hemp is appropriately destroyed or remediated in compliance with applicable state, tribal and federal laws.

A list of allowed disposal techniques and descriptions is available on the U.S. Domestic Hemp Production Program webpage.

“One of the top considerations in making these changes was the desire to provide additional options that minimize, to the extent possible, the resource impact to state and local law enforcement in handling hemp that is out of compliance,” Ibach said.

“We look forward to partnering with producers, states, tribes and other stakeholders to deliver regulations that work for everyone,” Ibach added.

USDA received thousands of comments about its Interim Hemp Rule, and certain provisions are likely to continue to cause difficulties for the industry, such as requiring THC testing to occur post-decarboxylation. Nevertheless, USDA has committed to opening another public comment session in the fall of 2020 to gather more input from the industry on the 2020 season.

APHIS publishes criteria for recognizing livestock compartments

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The U.S. Department of Agriculture’s Animal & Plant Health Inspection Service (APHIS) has published the final criteria the agency will use to evaluate and recognize livestock compartments in other countries.

According to APHIS, compartmentalization is "an important tool animal health officials can use to protect against disease spread and support continued trade during a disease outbreak."

The livestock or poultry within a compartment are managed using consistent, strict biosecurity and health practices and are kept separate from other populations of animals, which "reassures trading partners that there is a minimal risk of those compartmentalized animals spreading disease," APHIS explained.

When disease strikes, unaffected compartments are still eligible for international trade. More importantly, recognizing compartments in other countries makes it more likely that APHIS will be successful as it works with other countries to recognize compartments during an outbreak in the U.S., the agency said.

The evaluation criteria for compartmentalization are similar to what APHIS already uses for regionalization requests, with slight changes to account for the differences between regions and compartments, the agency said. The criteria are:

  • Scope of evaluation requested;
  • Veterinary control and oversight of the compartment;
  • Disease history and vaccination practices;
  • Livestock or poultry commodity movement and traceability;
  • Epidemiologic separation of the compartment from potential sources of infection;
  • Disease surveillance;
  • Diagnostic laboratory capabilities, and
  • Emergency preparedness and response capabilities.

Using this information, along with site visits from APHIS animal health experts, APHIS will determine whether the animals within the compartment are managed in a way that keeps them distinct and separate from other animal populations within the country, the announcement noted.

APHIS received seven comments on the proposed rule during the 60-day public comment period, all of which supported this rule. As a result, APHIS made no changes to the proposed rule.

The rule was published in the Feb. 28 Federal Register and becomes effective 30 days after publication, i.e., March 30.